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Guidelines for Requesting a Waiver from Competitive Bidding With some exceptions, all purchases, that represent a commitment of over the bid limit, per fiscal year, per supplier, must be bid. Bid limits: GOODS: $25,000, SERVICES: $50,000, CONSTRUCTION: $50,000. The Purchasing & Contracting Office often receives questions about the procedure for requesting a waiver from the competitive bidding requirement. Authorization limits for waivers: ALL REQUESTS: A buyer will review the request for his or her approval. The Director of Purchasing must also approve all waivers. REQUESTS OF $100,000 OR GREATER: The Director of Business Services must approve all waivers of $100,000 or greater. REQUESTS OF $250,000 OR GREATER: The Assistant or Associate Vice President for Finance must approve all waivers greater than $250,000. REQUESTS OF $500,000 OR GREATER: The Vice President for Administration & Finance must approve all waivers of $500,000 or greater.
1. When is my purchase a candidate for a waiver? Your purchase is a candidate for waiver if (and only if) all of the following circumstances apply: A. You are requesting a purchase greater than the bid limits. The dollar amount of the entire purchase should be considered, not the value of the individual items. A purchase may not be pyramided - i.e., it may not be split for the primary purpose of avoiding bidding requirements. NOTE: With some exceptions, all purchases, that represent a commitment of over the appropriate bid limit amount, per fiscal year, per supplier, must be bid. B. The vendor selected is not already on contract. If a vendor is already on contract (prior to this purchase), bidding is not required, regardless of dollar amount. To determine this, go to http://www.finance.ohiou.edu/. Select the Procurement Services link. At the Procurement website, select the Purchasing & Contracting link. At the Purchasing website, select “Existing Contracts and Price Agreements.” Check to see if your vendor appears as contracted to provide the type of item you require. Or call us at 593-1960 to check on the vendor. Return to FAQ's
2. Under what circumstances is a waiver granted? Whether or not the waiver request will be approved depends on how strong a case you make. Here are some common grounds under which a waiver will be granted: A. The vendor is obviously a sole source for the item. Examples: 1.) Artwork 2.) Unusual and not generally available used equipment 3.) A very specialized piece of scientific equipment 4.) Specialized service (e.g., lobbyists, consultants) when the supplier has a one-of-a-kind ability to provide the required service due to demonstrably unique circumstances (knowledge, contacts, experience, etc.). It helps if you provide backup to this sole source claim (article from a scientific journal, e.g.). Backup should be from an independent source (i.e., not from the vendor involved). B. There is an undeniable compatibility requirement. The item(s) will be hooked up to existing equipment, or the purchase is an upgrade to existing software, etc. C. There has been an unpredictable emergency, and there is no time for a bid. EXAMPLE: Equipment that provides a vital service to campus breaks down unexpectedly. Repair or replacement will cost more than the bid limit, but a waiver is needed to allow work to begin immediately to meet the emergency need. D. The purchase of this very particular item is part of an existing grant agreement, or joint agreement elsewhere. Conditions of a pre-existing, authorized agreement (with a granting agency or research partners outside the University) specify the use of a very specific item and vendor. Return to FAQ's
3. Under what circumstances is a waiver denied? Here are some common examples of what does not work: A. "We did some looking around, and this vendor is offering a very good deal.” This may be true - but a formal competitive bid process, conducted by the Purchasing & Contracting Office, is what is used at the University to document that claim, and to document the integrity of the process used to make the final vendor selection. The competitive bidding process demonstrates that due diligence was used in spending tax payer dollars, and that fair business practices were used. REMEMBER: Internal and external auditors, vendors unhappy with not being selected, the news media, or any interested person can (and do) request information on vendor selection processes. B. "I waited so long to work on this, that now I need it tomorrow." The Purchasing & Contracting Office will work with you to make the competitive selection process happen as quickly as possible - but it still has to happen. C. "I already promised the sales rep" - or - "I already have the item" - or "The company has already started work." Making such purchases or agreements at a departmental level is contrary to University policy. The promise must be taken back, the item must be returned, the company must stop work - and a competitive bidding event must take place. See this FAQ also: People in my department inadvertently violated University purchasing policy and a vendor has already started work that will cost over the bid limit. It’s too late to turn back. Now what? (below). D. “It would be so much more convenient if we could use this vendor” (or “if we could have this done a little sooner.”). Convenience isn’t a strong enough factor to allow the granting of a waiver from competitive bidding. An emergency situation must be present. Return to FAQ's
4. Can I split my purchase to avoid the bid limit? No. A purchase may not be pyramided - i.e., it may not be split for the primary purpose of avoiding bidding requirements. Return to FAQ's
5. How do I request a waiver? Follow these steps: A. A Request for Waiver form is available at www.finance.ohiou.edu/forms. Choose Purchasing and select the Request for Waiver form. B. Fill out the form as shown. C. Sign the form. D. Attach the signed, completed form to a Requisition (also available at www.finance.ohiou.edu/forms - choose Purchasing and select Requisition). E. Make a note in the body of the Requisition, stating: “Request for Waiver attached.” F. Attach written confirmation of the pricing. Take care to provide an accurate, thorough, explanation of the circumstances on your form. REMEMBER: Should auditors or a disgruntled vendor or a reporter or an unhappy taxpayer challenge this purchase, your explanation is the University’s first line of defense. Return to FAQ's
6. What happens to my request? Once it arrives in the Purchasing & Contracting Office, it is reviewed for approval as specified in the “Authorization limits for waivers” paragraph, at near the top of this screen. If the request is denied: The Requestor will be notified. If it is approved, the Purchase Order notification to the Requestor serves as notification. Legal Affairs arbitration: The University Legal Affairs Office will arbitrate disagreements as needed, and as a last resort (see Can I protest a denial?, below). The Legal Affairs director will prepare a memo detailing his or her decision, for inclusion with the Purchase Order and waiver or bid documents, as appropriate. The decision of the Legal Affairs director is final. Return to FAQ's
7. What happens next if I am denied? The purchase will be put out on competitive bid by the Purchasing & Contracting Office. You may be required to provide more information regarding specifications and needs. Once the bids are received, you (and others involved, as appropriate) will be asked to review the results and make a selection. If you wish to select a vendor other than the low bidder, you will be asked to supply a justification memo. This memo must provide solid, defensible reasoning for the selection. The buyer involved will guide you in this process. Return to FAQ's
8. Can I protest a denial? Yes. If you feel you were unfairly denied, talk first to the buyer involved. If misunderstandings were involved, and the buyer becomes convinced that a waiver should be granted, he or she can guide you in preparing a more successful request for a second try. If you become convinced that a waiver is indeed inappropriate, you will be asked to provide information and review for the bid procedure that must follow. If the problem cannot be resolved at the buyer level, ask the buyer for the name of the person at the next level. Voice your protest up the ladder. The University Legal Affairs Office will arbitrate disagreements as needed, and as a last resort. The Legal Affairs Director will prepare a memo detailing his or her decision, for inclusion with the Purchase Order and waiver or bid documents, as appropriate. The decision of the Legal Affairs Director is final. Return to FAQ's
9. My original purchase order to the vendor was under the bid limit, but I need to request a change that will put it over the limit. It’s highly impractical to change supplier midstream. What now? A waiver can be granted if an unforeseeable complication caused an unexpected cost overrun. Use the following procedure: A. Obtain a Request for Change Order form (www.finance.ohiou.edu/forms - link to form). B. Fill out the form as shown. C. Obtain a Request for Waiver form to request a waiver from competitive bidding, (www.finance.ohiou.edu/forms - link to form). D. In filling out the Request for Waiver form, describe the nature of the unforeseeable complication, and request a waiver due to the impracticality of switching suppliers mid-project (describe as needed). Return to FAQ's
10. People in my department inadvertently violated University purchasing policy and a vendor has already started work that will cost over the bid limit. It’s too late to turn back. Now what? This is a serious violation of University Purchasing policy. A Requisition for the entire purchase should be sent to the Purchasing & Contracting Office immediately. Attach a memo describing the circumstances to the best of your ability. The memo should explain why such an irregular route, contrary to University policy, was taken. It should also explain why the work or acquisition cannot be halted. It must indicate a current understanding of University purchasing policy, as well as clear intent to follow University Purchasing policy in the future. Depending on several factors - e.g., overall cost of the purchase, the Requestor’s history in regard to Purchasing policy violations - one of two things will happen: A. A one time exception will be made, allowing the vendor to be paid on University funds. B. An exception will not be made, and since the purchase was made absent any formal agreement by the University, the University is not obligated. Liability for the expense becomes a personal obligation to the Requestor. Return to FAQ's
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