Suppliers & Contracts Policy

EFFECTIVE DATE: January 18, 1995 |LAST UPDATED: December 21, 2016 | Policy Section: buying-paying

Responsible Executive

Carolyn Ainslie, vice president for finance and treasurer

Responsible Office

Purchasing

Contact

Jason Knoch, executive director of financial services and strategic initiatives, (609) 258-9181

I. Policy StatementBACK TO TOP

Supplier contracts have been negotiated, structured and leveraged by the Purchasing Department to identify preferred sources of supply that offer the best possible pricing to all University departments. All University departments are encouraged to order goods and services from preferred contract suppliers for the University.

II. Who is Affected by this PolicyBACK TO TOP

All faculty, staff, researchers, graduate students, undergraduate students, and independent contractors.

III. Definitions

Asset

A purchase, whether a physical good or intangible property, that has monetary value and is accounted for in the owner's balance sheet.

Department

An operating unit of the University. See Home Department, Initiating Department, Owning Department, and Reporting Department.

Goods

A physical item other than money, real estate, or services.

Supplier

An external party that maintains an ongoing relationship with the customer to provide relatively common or standard goods, or services.

IV. PolicyBACK TO TOP

CONTRACT SUPPLIERS
The use of preferred contract suppliers allows University departments to:

  • Identify the optimal sources of supply.
  • Secure the best prices.
  • Develop process efficiencies.
  • Deliver high quality products and services.
  • Ensure that small/minority/woman-owned and disadvantaged businesses are included.
  • Make these agreements available to all University departments.
  • Provide timely and accurate customer service.

Contract suppliers are preferred suppliers. Departments should first try to use an existing Purchasing contract supplier before entering into an agreement with another supplier. Competitive bids are not required when purchasing directly from a Purchasing contract. The Purchasing Department manages over 450 contracts with suppliers or service providers that have been leveraged into cost savings.

If a department identifies a potential supplier or need for specific goods or services, or if they purchase goods or services repeatedly from the same supplier, contact the Purchasing Department to explore a contract. The Purchasing Department will analyze this information to determine if it is the best interest of the University to establish a contract pricing agreement with this supplier. Interested suppliers can bid on contracts that are available by contacting the Purchasing Department.

When not utilizing an existing contract supplier, an agreement that includes provisions that adequately protect the University must be negotiated. These written contracts clarify each party’s obligations and include provisions that protect the University.

NEW SUPPLIER CONTRACTS
It is critical to formalize an agreement with the other party in a written contract that clarifies each party’s obligations and includes provisions that comply with University contracting requirements.

The Purchasing Department can help navigate the University’s contracting requirements, provide University-approved contract forms that can be adapted to your purposes, and assist in negotiating specific contract terms. Purchasing can also advise when a contract or certain provisions require further review or approval by other University departments, such as Environmental Health and Safety, Risk Management, or the Office of the General Counsel. Purchasing has put together a checklist of basic terms and conditions to be aware of when reviewing supplier agreements. Purchasing has also put together a checklist of basic hotel agreement provisions to be aware of when reviewing hotel agreements.

For additional information and guidance on written contracts, please refer to the Contracting Website.

DEBARRED, SUSPENDED OR EXCLUDED SUPPLIERS
When acquiring goods and services under federally sponsored programs, the University will not contract with a supplier who is debarred or suspended from doing business with the Federal government. Prior to awarding a contract, and in accordance with Federal requirements, Purchasing will check the Federal Excluded Parties List System to ensure that the prospective supplier is not found in the EPLS.

SURPLUS PROGRAM
Prior to contacting a supplier to purchase commonly used equipment, departments should review the Surplus Program web listing to manage demand, avoid unnecessary purchases and to limit quantities ordered. Federally funded project contracts require that the Surplus Program be considered prior to acquiring new equipment. The Surplus Program provides an inventory of and access to underutilized equipment that is available for repurposing within the University. The Surplus Program is an excellent source for common equipment such as filing cabinets and office furniture.

ON-CAMPUS SOURCES
The University provides many goods and services on campus for less than an individual order placed off-campus would cost - for example: restaurant services, communications, and media services. University services should be considered as a first source for the purchase of goods and services. If the Purchasing Department receives a requisition for an item available through University services, the buyer may forward to requisition to the appropriate service organization or require the department to place an order that can be processed.

SUSTAINABLE GOODS AND SERVICES
When purchasing any good or service, keep the University’s sustainability efforts in mind by seeking recycled and environment friendly products. A “green” catalog of environmentally friendly and energy-efficient products maintained in the PeopleSoft purchasing system. Recycled office supplies are available from the University's preferred contract supplier for office paper and supplies.

The Purchasing Department is a member of the Princeton Sustainability Committee (PSC) and has been working to ensure that the University’s goals are being met in this arena in accordance with Federal Acquisition Regulations. The University is also the lead organization with the NJHEPS environmental purchasing co-op.

100% Recycled Paper
The Princeton Environmental Oversight Committee (PEOC), established by President Tilghman in 2002, received approval to implement a University-wide policy on the use of 100% recycled paper. Refer to the article published in the March 22, 2004 issue of the Princeton Weekly Bulletin.

It is Princeton University policy to purchase and use 100% post consumer paper for all general office needs, in accordance with the following guidelines:

  1. All printing, copying, and writing grade papers shall be made with 100% recycled materials. Electronic mail use is encouraged, whenever possible.
  2. When ordering from OfficeMax, the product to be ordered is Aspen 100, part number P1054922, or P1054922CTN. Accordingly, OfficeMax will ship Aspen 100, (Part #P1054922) in lieu of all other general purpose office paper, except colored paper.

The Purchasing Department will work with the PEOC to respond to requests for paper that does not meet these criteria.

SMALL AND DISADVANTAGED BUSINESSES
The University is committed to providing opportunities to small businesses of all types (small, disadvantaged, women-owned, veteran-owned, service disabled veteran-owned, and small businesses located in historically underutilized business zones). The University includes the maximum practical number of small businesses in the competitive bidding process in an effort to comply with Executive Order 11246 and Public Law 95-507 reporting requirements. Please click here for the list of small and disadvantaged businesses.

The Purchasing Department will make every attempt to identify a Small, Disadvantaged Business Concern on all quoted requirements using the RFP Depot bidding system. Individual buyers are required to meet the minimum bid requirements on any RFQs they are working on, while also ensuring that the Public Law 95-507 governmental reporting requirements are met. Small business concerns will be included in the RFP when they have shown the ability to service the University and have the expertise and buying power to be competitive for the selected commodities. These suppliers will be given every opportunity and afforded the information required to bid on all requirements, such as everyday buys, contracts, etc. The US Small Business Administration's ProNet small business network can be used to identify potential suppliers. Another source is www.DiversityBusiness.com, which is a database of Women and Minority Business Enterprises (W/MBE's) that can be used to identify potential suppliers.

A minimum of three suppliers, plus at least one "opportunity" supplier, will be selected for each commodity from the Small, Disadvantaged Business resources whenever possible. They will be judged on the same criteria, and adhere to the same parameters as all other suppliers. It is the University's intent that by using this bid process, the Small, Disadvantaged Business Concerns will be able to establish themselves at the level of pricing and service required by the University to be awarded orders and/or contracts. If a Small, Disadvantaged Business Concern is not able to meet the minimum insurance requirements, a request for waiver or reduction may be considered (in accordance with the Princeton University Standard Terms and Conditions) by the Office of Risk Management. In addition, staff will invest additional time and effort in meeting with Small, Disadvantaged Business Concerns in an effort to cultivate a relationship which is mutually beneficial.

INTERNET AUCTION PURCHASES (Example: ebay)
Internet auction sites are an approved method for acquiring new or used equipment and supplies. However, purchases must be coordinated through Purchasing in order to be eligible for reimbursement.

Buyers must first contact the Purchasing Department so that the Buyer for that product commodity can 1) check if the product is already available in the Central Surplus Program 2) perform a cost/price analysis of the internet auction and 3) check if the product is available through a University contract supplier.

Purchasing new or used equipment via Internet auctions often has potential trade-offs with product performance (i.e., guarantees, returns, warrantees, added shipping costs, etc.). Auction suppliers may have specific requirements for participation that do not comply with University purchasing policy. The following issues must be considered before a department attempts to purchase any item through an Internet auction:

  • The auction must comply with your Direct Order limits, with respect to the purchase total dollar amount and your level of approval authority.
  • The purchaser must ensure the following for all auctions:
    • The requirements for competition have been satisfied.
    • All negotiations are conducted according to established purchasing policies.
    • No conflict of interest is present.
    • The items are for University business purposes.
    • Other University purchasing policies are followed.
  • Transactions for all items that individually cost more than $5,000 and have a useful life of one year or more must be reported to the Purchasing Department for capital reporting purposes.
  • Equipment purchased on a 4XXX or 6XXX project grant must be pre-approved by the Office of Research and Project Administration.

If the Purchasing Department determines that participation in an Internet auction is appropriate, a Buyer will participate in the auction on your behalf using a Purchasing auction account, after which the charges will be reallocated. If participation is not appropriate, the Buyer will assist you in finding other alternative sources of supply.

Since Internet auctions are typically transacted via personal accounts, any transaction that is not coordinated with the Purchasing Department will be considered a personal transaction and therefore it will not be reimbursable. Documentation that the Purchasing Department assisted with the transaction will be essential in establishing that the transaction was for official University business and thus may be either claimed for reimbursement or paid via the Purchasing Department account.

FORMALIZING CONTRACTS
When the University accepts an obligation to another party, a written document records the terms of the agreement and can prevent misunderstandings. The University’s Contracting Website was created by the Office of the General Counsel in consultation with the Purchasing Department. The website provides information about the University requirements. It is a resource for employees while negotiating and formalizing written contracts. The Purchasing Department is available to assist departments in formalizing the contract.

An agreement may be embodied in a variety of formats, including preprinted contract forms, terms and conditions, purchase orders, letters containing the terms of an agreement, leases, and waivers. The University has its own standard contracts for certain transactions, which provide the University with the greatest protection. Whatever the format, the agreement should comply with University contracting requirements to protect the University’s interests and ensure that the University does not assume inappropriate risks.

REQUIRED SUPPLIER INSURANCE
All suppliers must be in compliance with University insurance requirements set out in the University Insurance Requirements Policy and on the Contracting Website. The Purchasing Department is responsible for obtaining valid Certificates of Insurance for all supplier contracts. The Purchasing Department will ensure that appropriate insurance clause will be included on the individual purchase order for orders over $2,500 requiring on-site work. Purchasing Department will work with the Office of Risk Management to ensure compliance with University insurance requirements.

Departments will forward a copy of the valid certificate of insurance to the Office of Risk Management for confirmation of insurance requirements and to be kept on file.

Vehicles - Purchased and Long Term Lease
All vehicles purchased or leased by Princeton University will be registered to "The Trustees of Princeton University" by the Purchasing Department in compliance with New Jersey regulations. The Purchasing Department will add all purchased and leased vehicles to the University’s automobile liability policy via the Princeton University Report of Automotive Equipment Change.

In-Transit Insurance
Princeton University’s property insurance policy provides in-transit coverage for property owned or leased by the University. The University’s fine arts insurance policy provides in-transit coverage for fine arts owned by the University, and fine arts on loan to the University under a loan agreement. In general, the shipper will provide coverage FOB point of origin and the carrier is responsible for coverage as required by SEC regulations. In the event of a loss, departments will be charged a $1,000 deductible. The Purchasing Department is responsible for notifying the Office of Risk Management when the total value of a shipment exceeds the property insurance in-transit sublimit coverage of $5 million or the fine arts in-transit sublimit of $100 million. The Office of Risk Management will determine whether additional coverage would need to be purchased.

SUPPLIER PASSES
The supplier pass program controls supplier access to departments by reducing interruptions caused by unannounced sales calls or visits. Supplier passes also eliminate "back-door" selling and reduce the University's liability regarding safety violations.

Suppliers soliciting business will be directed by the departments to apply for a supplier pass with the Purchasing Department. Passes will not be required by repair persons who have been summoned to work on existing equipment in a specific department. Suppliers who do not wish to conform, or otherwise abuse any of the privileges granted by this policy will jeopardize future business with the University.

V. Procedures BACK TO TOP

VI. Forms BACK TO TOP

VII. Contact Roles and Responsibilities BACK TO TOP

VIII. Update Log BACK TO TOP

6/26/13

Updated link to contract suppliers.

2/25/11

No change to policy or substance; revised organization and language for web-based policy library.

1/18/95

Approved


 

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