PS-05.A.06 - Contract Administration

a. Contracts for the procurement of goods, materials and supplies that are normally procured by the University Purchasing Departments, or

b. Contracts pertaining to Sponsored Research and/or intellectual property which are funded by grants or other external funding sources (these are processed by the University of Houston-Downtown Office of Research and Sponsored Programs.)

a. In accordance with the UH System Chancellor/President's Delegation of Authority and

b. Made in writing and on file with UHD Contract Administration Office.

c. Individuals approved as a signatory in accordance with paragraphs a. and b. above may delegate contract signatory approval in writing during periods they are temporarily off campus (e.g. vacation, sick leave, etc.), or for relatively lower value contracts and/or specific types of contracts.

a. The description of the goods and services to be provided to the University (e.g. warranties, delivery terms, acceptance period, and maintenance terms),

b. The description of the University’s obligations (e.g. scope of work, payment due dates, late charges, tax, charges, insurance, and confidentiality requirements) and all other provisions of the contract,

c. Ensuring that all good faith efforts are employed to meet all terms, conditions and responsibilities of the contract, and

d. Ensuring the contract terms are met prior to payment for the defined scope of work.

3.1.1 Subsequent to the Chancellor’s delegation, the President may negotiate, execute and administer all contracts and related necessary legal documents and instruments not requiring Board approval as designated in this PS.

3.1.2 Prior to the beginning of each fiscal year, the President may delegate to the Vice Presidents and other individuals the authority to negotiate, execute, and administer contracts and related necessary legal documents and instruments not requiring Board of Regents approval. This delegation will be kept on file in the President’s Office, Business Office and Board of Regents System Office. A copy will be forwarded to the Vice Presidents and the UHD Contract Administration Office.

3.1.3 Each President, Vice President and other individuals to whom authority has been delegated in section 3.1.2 may negotiate, execute, and administer all contracts and procurement of equipment, goods, and services, or extension, modification or renewal of existing contracts, up to and including the amount specified in writing, but not expected to exceed $300,000 as follows:

3.1.4 All contracts from $300,000 to $500,000 shall be approved by the Senior Vice Chancellor/Vice President for Administration and Finance. Contracts greater than $500,000 require the approval of the Chancellor; Senior Vice Chancellor/Vice President for Administration and Finance; component university President (if appropriate); component university Chief Financial Officer (if appropriate); and (in the case of construction contracts) the Associate Vice Chancellor for Facilities/Construction Management. Furthermore, all contracts greater than $500,000 must be signed by the Chancellor or his or her designee.

3.1.5 Contracts greater than $1 million must be approved by the Chancellor, following approval by the Board.

3.1.6 When total project costs of a new construction and/or renovation project are $300,000 or less, each component university shall ensure that all plans, specifications and bidding documents are reviewed for compliance with applicable state laws prior to being released for bidding. When total project costs are greater than $300,000, the System Facilities Planning & Construction Department shall manage the projects. This includes the review of all plans, specifications and bidding documents for compliance with applicable state laws prior to being released for bidding.

The Component may request authority to manage a specific project over $300,000 up to $1M by submitting a request in writing detailing the scope of the project for the approval of the Vice Chancellor on a project by project basis. Evaluation and approval of requests will be based upon the Components expertise and ability to negotiate, review, and administer such contracts. Requests for authority to manage a project over $300,000 up to $1M by the Component must be received and approved before proceeding with the project.

3.1.7 The following contracts must be routed through the Office of Contract Administration for Contract Compliance for the Chancellor’s approval and execution. Delegated authority is not given to the component university Presidents for the following:

3.2.1 All contracts must be reviewed and approved by OGC before execution.

3.2.2 Standard form agreements less than $50,000with no substantive change may be used without additional review and approval by the Office of the General Counsel.

3.2.3 Non-standard agreements with an unaltered standard addendum attached, that are less than $50,000 and not within any of the special contracting requirements set forth elsewhere in this PS, do not require approval by the Office of General Counsel.

3.2.4 Any substantive change that modifies the legal terms of a contract or agreement will render the document non-standard and require OGC review and approval.

3.2.5 All standard revenue form agreements $50,000 and under with no substantive change may be used without additional review and approval by the Office of the General Counsel. All standard revenue contracts over $50,000 must be reviewed by OGC. All non-standard revenue contracts must be reviewed by OGC.

3.2.6 All contracts valued at $50,000 or more must be reviewed by OGC.

3.3.1 Submission of a contract amendment must include the proposed amendment and a copy of the original contract together with any prior amendments.

3.3.2 Contract amendments must follow the same review and approval process that applied to the original contract, or the higher review, approval process and signatory as required by the dollar value of the amended contract.

3.3.3 Contract amendments must be signed by the same individuals who signed the original contract or the individuals currently in the same organizational position designated on the original contract.

3.3.4 Proper signature authority for an amendment is determined by adding the total value of the original agreement plus all subsequent amendments. If the total value increases the delegated level of signature authority, the higher level signatory must be added to the amendment document along with the original contract signatories.

3.3.5 In instances where the original contract was approved by the Board and the aggregate revised contract amount does not exceed 25% of the original contract, the Chancellor is authorized to execute the amendment, change, extension or renewal without further action by the Board.

3.3.6 In instances where the original contract was not approved by the Board and the aggregate revised contract amount will exceed $1,000,000, the Board must approve the amendment, change, extension or renewal.

3.4.1 Contracts for the purchase, gift or acquisition of real property.

3.4.2 Contracts for the sale of real property or conveyance of any interest in real property; expressly excluded are utility easements to serve one or more component universities.

3.4.3 Real estate leases and lease renewals and extensions, as lessee, if the obligation of the lease is equal to or greater than $1,000,000

3.4.4 Oil and gas leases with an expected bonus exceeding $100,000.

3.4.5 Banking agreements.

3.4.6 Any single procurement or revenue contract for construction, equipment, goods, and/or services, not specified above, that is expected to exceed $1,000,000.

3.4.7 Any extension, modification, or renewal of an existing contract that would cause the revised aggregate contract amount to exceed $1,000,000, or that increases the value of a contract already approved by the Board by over 25%.

3.4.8 Any series of contracts that are initiated in the same department for the same goods or services with the same party within a fiscal year, that if combined in one contract, would require Board approval.

3.4.9 Any other contract the Board might designate as having significant importance to require Board approval.

3.5.1 All contracts requiring Board approval must be reviewed and approved by OGC before execution.

3.5.2 The Chancellor is a required signatory on all contracts approved by the Board.

3.5.3 The department and/or the Responsible Party for the contract is responsible for continuously monitoring all procurement contracts over $1,000,000 executed on or after September 1, 2015, which are considered contracts that require enhanced performance monitoring for compliance during the term for the contract. Any serious risks or issues related to the contract (such as delivery schedules will not be met or other breach of contract terms) shall be reported to UHD’s Vice President for Administration and Finance and the Contract Administration Office, for reporting to the UH Controller.

3.7.1 State law requires that selection and award of contracts for Professional Services be based on the professional’s demonstrated competence, the professional’s qualifications for the type of services to be performed and a fair and reasonable price, rather than on the basis of competitive bids (Texas Government Code §2254.003). Failure to comply with these requirements will render the associated contract(s) void.

3.7.2 All consulting contracts that can reasonably be expected to or will exceed $25,000 must be reviewed by OGC to ensure compliance with the numerous state requirements that must be met before and after entering into consulting contracts (including contract renewals, amendments and extensions for such services). Failure to comply with the state requirements will render the associated contract(s) void.

These contracts must be submitted to OGC at least six (6) weeks prior to the start date for services. The additional time is needed to request approvals from the Governor's Budget & Planning Office and the Legislative Budget Board (LBB). A request for proposals for the consulting services must be published in the Texas Register.

3.7.3 Following the end of each fiscal year, a report shall be submitted to the Board of Regents listing all professional service or consulting contracts where total compensation from System-wide sources to a single entity exceeded $250,000 during the fiscal year.

3.8.1 Except as otherwise directed by the System Tax Department, all contracts that generate revenue for the University, regardless of amount, must be reviewed by OGC, which will notify the Tax Department about the contract and ensure the contract is executed by the appropriate individual. The University is authorized to enter into contracts that generate revenue if the transaction does not create adverse tax implications for the System and is directly related to furthering UHD’s educational mission, research, extension, public service or campus support functions.

3.8.2 All revenue generating contracts and all contracts where payment by the University is contingent upon records processed and maintained by another party to the contract must contain an audit clause. This clause must give the System and/or University the right to access and audit any and all documents pertaining to the contractual relationship held by any party to the contract.

a. The vendor does not require a contract, and

b. The transaction involves no terms and conditions outside of the defined scope of work (i.e., cost of purchase, time frame and description of work), and

c. The purchase is made with local (as opposed to state) funds.

a. For an individual purchase less than $5,000, pay the invoice, or

b. For an individual purchase of $5,000 or more, and a total fiscal year expenditure to the vendor of less than $25,000, use a purchase order issued by the Purchasing Department.

3.12.1 Contract Management - The Responsible Party (RP) assumes primary responsibility for the contract from inception to completion of the transaction. The Contract Administrator will assist with non-standard contracts or agreements.

3.12.2 Contract Payment – Payments subject to this PS require a fully executed contract before payment can be issued by Accounts Payable, regardless of payment amount. All payments or reimbursements for contractor expenses must be authorized by the contract. The Originating Department/Responsible Party is responsible for providing all pertinent documents and information required by the Accounts Payable Department.

3.12.3 Retention of Contracts and Related Documents – In accordance with Senate Bill 20 Section 441.1855, UHD is required to retain each contract entered into and all contract solicitation documents related to the contract and may destroy the contract and documents only after the seventh anniversary of the date:

3.13.1 The Contract Administration Office will:

3.13.2 The Contract Administrator will:

Provide required notices and reports on a timely basis to the Legislative Budget Board (“LBB”) and other required state reporting offices

4.3.1 The top half of the Information Security Hosted Services Contract Checklist (“General Contract Information” and “Summary of Contract Terms”) must be completed and forwarded to the Director of UHS Information Security for assessment.

4.3.2 The completed Checklist will be returned to the department, and must be included in the contract package forwarded to the Contract Administration Office.

4.5.1 All revenue-generating contracts over $50,000 require OGC review and approval. (Reference paragraph 3.2 including subparagraphs.)

4.5.2 Contracts on the “Contract Compliance and Administration” website have been approved by OGC as indicated in the footnote of the contract document.

4.5.3 Non-standard agreements with a standard addendum attached, that are less than $50,000 and not within any of the special contracting requirements set forth elsewhere in this PS should be administered by the Originating Unit in accordance with this PS. Review of such contracts by OGC is not required. (Reference paragraph 3.2 including subparagraphs.)

4.5.4 All other vendor and contractual documents without the OGC approval can be forwarded to the Contract Administrator for processing through OGC and execution of the contract package.

4.6.1 All applicable administrative and legal reviews must be completed prior to execution of a contract.

4.6.2 The contract must be fully executed by authorized contract signatories prior to commencement of any duties/actions by the parties pursuant to the contract.

4.7.1. Processing Time – Contracts should be processed as far in advance as possible before the effective date/start date of the contract or before the start date for rendition of services, delivery of goods, or occupancy of leased space. An originating unit should be cognizant of the time periods required for processing different kinds of contracts.

For example, a contract for consulting services as explained in paragraph 3.7.2 must be processed far enough in advance of the effective date/start date of the contract to effect compliance with state rules and regulations, and/or Texas Government Code requirements (Chapter 2254).

4.7.2. Rush Request – Rush requests for contracts that require OGC review and approval must be in writing and signed by a Vice President.

4.7.3. Effective Date/Start Date – The effective date/start date of the contract and/or the start date for rendition of services, for delivery of goods, for occupancy of leased space, or for use of leased equipment should be specified with a specific effective date (which is the preferred method), or as follows: “upon execution by the authorized representatives of the parties.” In the alternative, the effective date/start date should be no sooner than the date on which all applicable administrative and legal reviews have been completed and signed by all parties.

4.7.4. Standard Form Agreements - Standard form agreements that require no OGC review are to be fully executed least five (5) business days before the effective date/start date of the contract.

4.7.5. Agreements that Require OGC Review - Agreements that require OGC Review should be received by OGC at least twenty (20) business days prior to the effective date/start date of the contract to allow for negotiations of revised contract language (reference paragraph 3.2 and 3.3).

4.7.6. Additional Processing Time - Certain specialized agreements and those requiring public bidding may require longer processing times.