3.0 To ensure that the University is entitled to all protections under the Uniform Commercial Code, all procurement commitments in excess of $5,000.00 should be evidenced by a written document (purchase order, agreement, independent contractor agreement, license, or other University document of standard terms and conditions for conducting business). Some commitments, even for less than $5,000.00, may involve serious legal or financial risks, and in those cases, the responsible person of procurement authority should also require a written contract. Recurring purchases, even for less than $5,000.00, should be evidenced by a University agreement even though the individual releases under the agreement may fall under the $5,000.00 exemption.
The University, through the offices of Procurement Services, will from time to time establish contracts, agreements, business relationships, and affiliations with business entities and others which will constitute the University's Preferred Contract Listing (UPCL) for the exclusive benefit and use of the University and its affiliations. The nature of the contracts, the announcement of their application, use and limits, is the responsibility of the Executive Director and the Associate Vice President for Finance. All University faculty, staff, and employees are required to review the UPCL prior to seeking market research, acquiring goods or services under individual authority, or preparing requests for procurement of goods or services. The efficient and responsible conduct of business necessitates cooperation in the procurement activity of goods and services from firms which have contracted with the University for its needs and requirements. Contracts are established to be the recommended source of goods or services. Contracts and written agreements include specific conduct of business whereby the University is legally bound in both its understanding and actions with suppliers. Some contracts and agreements may have restrictive conditions, limits on the goods or services entitled to the University, and dollar or volume threshold limits contained within the understandings of the contract or agreement and shall therefore be explained or clarified in the published preferred supplier contract or the directives issued for its use. All procurement and engagement of services of the University are subject to existing contracts and agreements which therefore necessitate employee involvement and knowledgeable behavior in business matters.
3.0.1 Preferred Agreements are University contracts with special or unique benefits to both the University and the supplier whereby the University agrees to exercise direction, discretion, and control to make all best efforts to rely on the contracted supplier for all of its acquisition requirements. All procurement dollar thresholds for acquisitions are allowed; however, central review will occur on non-catalog orders between the values of $10,000 - $250,000 to ensure contract pricing has been quoted and for catalog orders totaling $250,000 to validate that the goods or services are best sourced through that preferred supplier.
3.0.2 Exclusive Agreements are University contracts that restrict the source of supply to the named supplier for all procurement or engagement of services. All procurement dollar thresholds for acquisitions are allowed.
3.0.3 Revenue Agreements are University contracts which involve a revenue source to the University, offset pricing by returned commissions or rebates, or involve the development of a product or service which may ultimately cause the University to benefit in payments, royalties, provisions for no-cost goods or services, or have a significant financial funding relationship to the University. Revenue Agreements include any supplier agreement which allows for the resale of products or services to the University, its students, and the general public. If a Revenue Agreement is a resale agreement that anticipates taxable sales to students or the public, the operation of such agreement will be allowed only if the University has an established relationship with the State of Illinois and the City of Chicago permitting the conduct of business as a commercial enterprise of the University. No revenue or value relationship revenue agreement or contract for trial, evaluation, testing, or analysis may be issued or executed unless reviewed and authorized by Procurement Services. Any contract for trial, evaluation, testing, or analysis not related to procurement or the engagement of services authorized by policy of the University or powers authorized elsewhere in University policies, by-laws, actions of the Board of Trustees, the President, the Provost, and others as authorized by the University are hereby excluded from this paragraph of this POLICY. All payments of revenue to the University are to be made payable to the Associate Vice President for Finance, The University of Chicago. No employee, department, or division of the University may establish operations, understandings, agreements, or contracts which permit revenue or credits to be generated for budget purposes between budget centers of the University in exchange for goods or services, including inventory and resale operations using recharge methods, without the prior written permission of the Associate Vice President for Finance.
3.0.4 Contracts or agreements for construction, renovation, design, engineering, remodeling, or trade labor services require signature review and approval of the Associate Vice President for Facilities Services prior to the authorization of work to proceed. The Associate Vice President for Facilities Services may assign representative supervision to project managers and other individuals employed under the direct supervision of the Executive Director, Capital Project Delivery, Facilities Services. The standard form of contracts or agreements under this paragraph shall be issued for use by the Executive Director and the Associate Vice President for Finance. No standard form shall be modified or replaced unless changes, modifications, additions to form, content, or purpose are approved by the Risk Management Department and the Office of Legal Counsel.
3.0.4 Exclusive Agreements are University contracts that restrict the source of supply to the named supplier for all procurement or engagement of services. All procurement dollar thresholds for acquisitions are allowed.
3.0.5 Independent Contractor Agreements are University contracts for the engagement of services from an independent contractor whose services are subject to the standard terms and conditions in a business relationship with the University. No independent contractor may be engaged at any dollar level unless an agreement of independent contractor services has been jointly executed by the independent contractor and an authorized procurement agent of the University. See statement 10.6 of this POLICY for requirements and payments of this engagement of services.
3.0.6 Maintenance Agreements are University contracts with an outside agency to maintain service or upgrade a system over a period of time
3.0.7 Lease Agreements (Equipment) are University contracts covering the lease or rental of equipment such as vehicles, computers, or scientific equipment.
3.0.8 Lease Agreements (Space) are University contracts for the lease or rental of office, storage, garage, land, or other space. All procurement dollar thresholds for acquisitions are allowed. Agreements and/or purchase order activity are processed according to Policy 1213 and Procedure 1.072.
3.0.9 License Agreements are University contracts relating to the licensing of a product.
3.0.10 Professional Services Agreements are University contracts relating to consulting, presenters, entertainers, or other professional service relationships.
3.1 All contracts and agreements of any kind pursuant to which the University agrees in any way to insure or indemnify any individual, association, corporation, or other organization or to release any individual, association, corporation, or organization from liability to the University must be in accordance with the policies, practices, and procedures established and published by the Risk Management department and the Office of Legal Counsel. Any contract that does not include the standard terms and conditions which insure and indemnify the University must have its terms reviewed by the Office of Legal Counsel. Any contract for any amount for goods or services which is not in accordance with the University standard terms and conditions such that the University is to indemnify the supplier must be approved for the University by the signature authorization of the CFO.
3.2 Contract modifications may pertain to initial contracts or modifications to existing contracts. Since modifications of contracts often produce disputes, it is required of all University procurement authorities to evidence all modifications by appropriate documentation which will be recorded with the Executive Director, the Associate Vice President for Finance, or the Office of Legal Counsel. All University employees are specifically requested to avoid oral commitments, changes to commitments, and cancellation or termination of commitments that are not evidenced by a written document either in the initial contract with the supplier or in any modification thereof.