The University of Chicago

Financial Services


User Guide for Local Business Center (LBC)

The business functions of purchasing and payable activity up to the dollar threshold of $25,000 have been incorporated into the Local Business Center (LBC). Procurement and accounts payable assistance will be provided to you by your Faculty Service Representative (FSR). The FSR is your first contact for obtaining information on sourcing references and identifying those suppliers now under contract with the University.

The LBC may also staff a full-time Buyer/Contract Specialist (Buyer) to assist the FSR with planning and procurement. The Buyer is responsible for compliance issues related to procurement and will assist with planning, preparation, sourcing or pricing on purchases up to $25,000.

Purchases which are anticipated to be $25,000 or more are managed by Procurement and Payment Services (the combined operations of the former University Purchasing Department and Accounts Payable Department of the Comptroller's Office) in conjunction with FSR/Buyer and initiator.

The University encourages the initiator to use information about sources of products and services and competitive pricing agreements available through your LBC.

The University recognizes that many purchases may be improved by the involvement and expertise of the initiator. The flexibility to acquire goods and services quickly, more efficiently, and with full utilization of the information previously gathered by the initiator are a few of the benefits the LBC will provide to the initiator. Your participation is recommended in these transactions, but not required.

University Guidelines

The University is required by outside entities (such as the federal government) and its own Trustees to conduct purchasing and payment activities prudently and in accordance with all laws and compliance mandates. The policies and procedures established by the administration reflect these requirements. Each employee (both faculty and staff) is responsible for his or her own actions in the procurement process. The LBC procurement staff is responsible for ensuring that transactions are properly managed and appropriately documented. Work with your LBC staff to take advantage of their guidance and support in your procurement needs.

Procurement Principles

All procurement activity is an exercise of delegated authority at various levels by which goods and services are obtained in the best interests of the University. The following principles form the backbone of the University's procurement policy and allow the initiator to act in confidence during his or her relationship with a vendor:

  • Each initiator of a procurement request is recognized as the decision maker of the transaction.
  • Subsequent reviews, approvals, support assistance and special authorities are designed to document the appropriateness of the procurement.
  • The initiator's actions and the subsequent actions of others complete the procurement and certify by signature approval that the procurement met process requirements.


All purchasing documents and related correspondence including quoted prices, specifications, terms and conditions of purchase are confidential and may not be revealed to parties outside the University.

Purchase Orders of $25,000 and Above

All products and services purchased having a total cost of $25,000 or more MUST be cost justified through price competition. A minimum of (2) quotations preferably (3), is required to meet competition. Purchasing and Payment Services will solicit price quotations, bids or proposals on behalf of the University initiator. No individual or department other than Purchasing and Payment Services is authorized to solicit price competition for purchases at this level. Departments requesting purchases at this dollar value are to submit a PURCHASE REQUEST (Form 100) to Purchasing and Payment Services for the goods and services needed. Include an attachment of the specifications required, recommended vendors to be solicited, if known, and any special instructions or limiting factors of material evaluation to be considered with this purchase. Also submit any market research material obtained by the department from prospective vendors. Identified by a "U" designation, followed by a six digit number. These orders ENCUMBER funds. They are not paid until both invoice and receiving information match the order information. Any commitment made by a department prior to authorization by Purchasing and Payment Services may not be acknowledged and purchases made may be non-binding upon the University.

Purchases of $25,000 and above are subject to critical audits during reviews of the University's procurement practices. Regardless of the source of funding for any given transaction, the University must follow stringent procedures at this dollar level to avoid penalties and possible funding loss or restriction. Therefore, if the amount of your purchase is likely to be $25,000 or more, YOU MUST CONTACT YOUR LBC FSR before beginning product or price research. He or she will contact Purchasing and Payment Services to ensure that the transaction proceeds with appropriate process review, documentation, and award evaluation.

The LBC will assist you in preparation of the University Request (Form 100). It should include an attachment of the specifications required, recommended vendors to be solicited, and any special instructions or limiting factors of material evaluation to be considered with this purchase. Also submit any market research material obtained by the initiator from prospective vendors. Purchasing and Payment Services will issue the order and instructions to the vendor after conducting required price competition, contracting arrangements and initiator acceptance of the purchase arrangements.

If you proceed without Purchasing and Payment Services involvement, you may be asked to provide additional information or your order may be held up while proper documentation is assembled. Please inform us immediately of your intentions to purchase so that we can avoid this occurrence and expedite your order.

Purchase Orders Less than $25,000

The LBC staff will manage procurements up to $25,000. They will use one of the following methods to place your orders:

  • Reference an existing University contract or purchase agreement. (These orders can exceed the $25,000 threshold and are the fastest to complete.)
  • Issue a BuySite Order following the dollar thresholds listed below:
  • Purchases up to $5,000: Considered as small dollar purchases. Place your order directly with the vendor.
  • Purchases of $5,000 to $24,999: LBC may solicit by phone or in writing for these products and indicate on the BuySite Price Reasonableness Form the results of their market research. A minimum of (2) quotations preferably (3), is required to meet competition.

Standing Purchase Orders

Standing orders can be established when multiple purchases are expected from the same vendor over a period of time. They allow the initiator to order directly from the vendor those materials and services described in the purchase order. Complete a University Request (Form 100) indicating the vendor, the type of items, the estimated dollar value and the effective time period. The LBC will forward the Request to Purchasing and Payment Services, which will issue the order. As a general rule of thumb, we ask that you reserve standing orders for those situations where you expect to use the order at least twenty times during the effective period. Standing orders DO NOT encumber funds.

Optional Initiator Participation

If you wish to take a more active role in the procurement process, follow these steps:

  • Document the price reasonableness of your purchase decision by completing the Record of Purchase worksheet as you gather price information. Be sure to include the individual you talked with and a phone number for each vendor contacted
  • Complete the LBC Requisition with items requested, suggested vendor, account and your name, phone and address
  • Bring the Requisition and Record of Purchase worksheet to the LBC. Your FSR or Buyer will issue an order number after reviewing the documentation
  • If you wish, you may phone your order to the vendor. The LBC will follow your phone order with a faxed confirmation copy. If the order changes during placement, call your LBC immediately!
  • After you obtain the goods, acknowledge your acceptance by signature on the invoice or packing slip and forward it for payment to the LBC.

Vendor Complaints

If a vendor has failed to perform as promised, it should be reported to the LBC. This is best done by submitting a Vendor Complaint Report. [For help in filling out the Vendor Complaint Report, see this page. The Vendor Complaint Report is a written record of problems that have arisen with a vendor. If a company repeatedly fails to meet its obligations, that vendor can be suspended from doing business with the University. If you are dissatisfied, please file the Report. You may be able to save yourself and other user departments aggravation in later purchases.

Overshipments: If more material is received than ordered, a second purchase request should be submitted to the LBC if you wish to keep the extra goods so that your authorization is recorded. If a vendor error resulted in the overshipment, then the vendor should bear all costs associated with returning the overage. For assistance with returning the material, please contact your LBC.

Damaged goods: Receiving and inspecting material is one of the most important elements of procurement. Please verify complete shipment contents and condition upon delivery. Contact the LBC if you have any problems. Before signing, always note on the receiving slip or invoice if a carton is damaged. Save the carton until claim is settled.

Justification for Sole Source Purchase

Definition: A purchase of $25,000 and greater to be made from only one responsible source when no other equipment, supplies or services are available to satisfy the initiator requirements, or, emergency circumstances which necessitate an unusual and compelling urgency in order to avoid a threat to health, welfare or safety.

Documentation: The University of Chicago Justification for Sole Source form has been developed to provide an acceptable level of documentation to demonstrate why the standard policy of encouraging free and open competition could not be followed for a particular purchase. For all such purchases expected to have a dollar value of $25,000, or more, this form must be completed by the initiator before the order can be issued. Forms are available at your LBC.