Frequently Asked Questions
The Business Services & Purchasing Departments receive questions every day regarding contracts, purchasing, Oracle Cloud, insurance, and other general business-related matters. Below is a list of and responses to the most frequently asked questions.
1. What is the difference between a purchase requisition and a purchase order?
A purchase requisition (PR) is an internal document submitted by a department for the purchase of goods and/or services. As its name implies, it is a request of the responsibility center manager to approve the purchase as necessary. A purchase order (PO) is a legal document binding a supplier to provide goods and/or services and the district to provide payment to the supplier. Only the purchasing department may issue a purchase order. In fiscal year 2018-2019, purchase requisitions start with PR91xxxxx, and purchase orders start with the numbers 19xxxxx.
2. What is considered a contract that would require going to Board for approval?
In short, a contract is any document that binds together the district with another agency, person or contractor and requires a signature. Contracts either obligate district funds, resources, and services or they provide the district with additional funds, resources, and services. Contracts don’t necessarily have a monetary value; some may simply share resources and create educational partnerships. Administrative Procedure 6340 states that all contracts are required to go before the Board of Trustees for action. Routine contracts can be processed and signed by Business Services prior to Board approval allowing services to begin immediately upon signature; these are known as ratified contracts. Contracts for professional services must be Board approved prior to signature; therefore, services cannot begin until Board action.
3. Can you provide examples of typical contracts?
Here’s a list of some of the names contracts go by: Contract, Grant, Sub-grant, Contract Education, Memorandum of Understanding (MOU), Confirmation Order, Quote (with an accepting signature), Agreement, Clinical Agreement, Affiliation Agreement, Maintenance Agreement, Service Agreement, License Agreement, Professional Services Agreement, Independent Contractor Agreement, Speaker Agreement, Performance Agreement, etc. Be sure to check out our Types of Contracts document on the Business Services wiki for additional descriptions of these various contracts.
4. Who has the authority to sign purchase orders?
The Board of Trustees annually designates to certain officers of the district the authority to sign purchase orders. This year, the Board has designated to the Business Manager, the Director of Fiscal Services, and the Executive Vice Chancellor the authority to sign purchase orders. No other individual has the ability to sign a purchase order or in any other way obligate the district to a purchase; any individual who makes such an obligation could be held legally liable for resulting costs.
5. Who is authorized to sign a contract?
Only a Board Authorized Signatory may sign a contract on behalf of the district. Any contracts signed by an employee or person other than an authorized signatory are not valid or binding on the district. The Board of Trustees annually delegates signature authority. The current authorized signatories are Business Manager, Executive Vice Chancellor, Director of Fiscal Services, and Chancellor. Please keep in mind that if you sign a contract or authorize a service without the Board’s authorization, you become personally responsible for the cost of the contract and/or services. An easy way to remember this rule: If you sign the contract, you get to pay the bill.
6. How many original copies of a contract must be submitted?
The district requests two original copies of a contract—one for the district to keep and one to return to the supplier after they are signed. The district previously required three contracts—one for the district office, one for the department, and one for the supplier; however, with the implementation of the ImageNow document retention software and Oracle Cloud, departments are able to view an electronic copy of the contract documents.
7. Are original signatures required on all copies of contracts?
Yes. At this time, the district has been advised to maintain original signatures on all contracts for the protection of district assets. Electronic, scanned or faxed signatures cannot be accepted.
8. Does the district provide any contract templates?
Yes, we do. District-provided templates are made available on the Business Services wiki page. Most suppliers and contractors supply their boilerplate contracts; however, the district is just as happy to provide our own terms and conditions. Even if you decide to use a supplier/contractor-provided contract, don’t be shy about negotiating terms that conflict with the district’s terms and conditions. There are some terms and conditions that are not negotiable in order to protect District assets. For more information and assistance, please call Virginia Diggle at extension 4085.
9. When do we need to send quotes to purchasing?
Administrative Procedure 6330 requires three quotes from three different suppliers for the purchase of equipment and services exceeding $20,000 per unit cost. Your department is responsible for securing the three quotes and forwarding the quotes to the purchasing department by attaching them electronically to the requisition.
10. What is the bid threshold and how is it established?
The current (calendar year 2018) bid threshold for goods, materials, equipment, and non-public works services is $90,200. This threshold is established annually by the California Community Colleges Chancellor’s Office and is published in January throughout the district. The district participates in the Uniform Construction Cost Accounting Program for its public works projects. The threshold is established in California Public Contract Code. The threshold for informal bidding processes is $45,000, and the threshold for formal bidding processes is $175,000. If you have additional questions regarding public works projects, please contact the purchasing department directly.
11. What is the general process for conducting a formal bid?
The department should contact the purchasing agent immediately when a bid is required. The purchasing agent will work with the department to identify and compose a thorough bid scope. This process may require multiple meetings and a few weeks. Once the bid documents are drafted and approved by the department and the Business Manager, the bid can be advertised. Bids are required to be advertised for a minimum of two weeks. Depending on the complexity of the bid scope, additional public advertisement may be recommended. At the conclusion of the bid, the purchasing agent will receive and compile the bid results. If additional evaluation is required, a committee will meet to more thoroughly evaluate the bids. The district will recommend a bid award to the Board of Trustees who will consider the award at a regularly scheduled meeting. The process in total may be as little as one month but could be as long as six months for complex purchases.
12. Is there anything I should keep in mind when developing my budget for my department’s purchasing needs?
Most departments do an excellent job of budgeting for their supply, equipment and general services needs for the year. The business services division recommends that departments review the Object Code Guidelines manual before submitting their developmental budgets in the spring. Some of the most commonly overlooked object codes are reference books (4220), in-house printing services jobs (4551), postage and freight (5350), and software licensing (5621).
13. What is the Cal-Card program? Can it benefit my department?
Cal-Cards are a state-approved credit card program that extends access district credit to approved employees. The program allows for expanded flexibility for everyday operating expenses; the program also requires heightened personal organization, responsibility and business ethics. The program is often times misperceived to relieve your department of internal processes; however, it is important for departments to know that the public still demands proper accountability over purchases, and the program has a comprehensive reconciliation process in the Oracle Expenses Module.
14. How do open purchase orders work?
Open purchase orders (a.k.a. blanket purchase orders) are a form of purchase where a set dollar amount is encumbered for purchases throughout an entire year to be made with a specific supplier. This method of purchasing is common for maintenance and police departments through local brick and mortar stores. If you believe this is a good option for your department, contact the purchasing agent to discuss this and other options open to you.
15. With which suppliers do we have special ordering processes?
The district is constantly attempting to improve its business processes in order to streamline ordering, reduce paper, and make purchasing simpler for your department. We currently have special ordering relationships with Staples Business Advantage, The Home Depot, Costco, Grainger, Apple Computer, and Dell Computer. If you would like to know more about these suppliers, contact the purchasing agent.
16. What is a Certificate of Insurance, and when is one required?
A Certificate of Insurance (COI) is proof of a supplier’s or contractor’s coverage of insurance. The district requires the supplier or contractor to show proof of specific insurance and list the district as an additional insured party. Being an additional insured party allows for the district to be reimbursed
for any damages to district property or to transfer liability to a supplier when there is risk arising out of a service, event or rental of district property. A COI must also show proof of workers compensation and liability in required amounts listed in the contract. A COI is required by the district for persons, suppliers, other districts, or agencies using our facilities or working on any of our sites.
17. What do I do when an agency or contractor is requiring a Certificate of Insurance from the district?
When a Certificate of Insurance (COI) is requested by an agency or contractor, a COI request from will need to be completed. This form is available on our wiki page. Simply complete the form and send a copy to the Business Services Department. If this request is part of a contract, please include the completed form with the contract packet being submitted. A copy of the contract needs to be submitted to our insurance administrator in order to facilitate the request for the COI. Sometimes this insurance industry form can get confusing and needs some further explanation. If you have questions while completing the COI request form, please call Virginia Diggle in Business Services at extension 4085. She will walk you through the process and guide you around common pitfalls.