«OTPS PURCHASES Last Updated: September 15, 2016 1|Page TABLE OF CONTENTS CHAPTER 1 4 1.1 RATIONALE 4 1.2 OVERVIEW 4 1.3 USING THE FAMIS PORTAL 8 1.4 ...»
Division of Financial Operations
STANDARD OPERATING PROCEDURES:
Last Updated: September 15, 2016
TABLE OF CONTENTS
CHAPTER 1 4
1.1 RATIONALE 4
1.2 OVERVIEW 4
1.3 USING THE FAMIS PORTAL 8
1.4 TOP AUDIT ITEMS 9 CHAPTER 2 11
2.1 AUTHORIZATION 11
2.2 REGULATIONS GOVERNING THE PURCHASING PROCESS 11
2.3 REGARDING PURCHASES FROM A CONTRACTED VENDOR 12
2.4 REGULATIONS RELATED TO COST 12
2.5 OTPS SPENDING – SERVING THE NEEDS OF EDUCATION 12
2.6 EXPENSES INCURRED BY A NON-NYC DEPARTMENT OF EDUCATION 16
EMPLOYEE FOR PARTICIPATION IN A PROGRAM
2.7 RESTRICTED PURCHASES 17
2.8 CHANCELLOR’S RIGHT TO WAIVE 23 CHAPTER 3 24
3.1 FORMS 24
3.2 HOW TO INSPECT DELIVERIES OF COMMODITIES 24
3.3 HOW TO CERTIFY FORMS FOR PAYMENT 25
3.4 HOW TO PURCHASE 26
3.5 HOW TO FILE A “CHANGE NOTICE” 28
3.6 VENDOR REFUNDS 29 CHAPTER 4 30
4.1 P-CARD ENROLLMENT 30
4.2 CARDHOLDER RESPONSIBILITIES 33
4.3 PURCHASING THRESHOLDS AND GUIDELINES 34
4.4 GUIDANCE ON P-CARD PURCHASES 36
4.5 TRANSACTION REVIEWS 40 2|Page CHAPTER 5 41
5.1 USE OF KITCHEN 41
5.2 ORDERING FOR USE OF KITCHEN 41
5.3 PAYMENT FOR USE OF KITCHEN SERVICES 42 CHAPTER 6 43
6.1 CHOOSING AN APPROVING OFFICER 43
6.2 SUBMITTING REIMBURSEMENT EXPENSES 43
6.3 ACCEPTABLE OUT-OF-POCKET EXPENSES 43 CHAPTER 7 44
7.1 RECORDKEEPING AND FILES 44
7.2 SECURITY MEASURES FOR POSTAGE AND METROCARDS 45
7.3 LIABILITIES FOR NON-COMPLIANCE WITH REGULATIONS 45
7.4 OTHER INTERNAL CONTROLS AREAS 45 CHAPTER 8 47
8.1 PAYMENT OF REFEREES AND OFFICIALS (PSAL) 47
1.1 Rationale The NYC Department of Education purchases instructional and non-instructional supplies and materials, textbooks, library books, equipment, school lunches, transportation, repairs, maintenance of equipment, professional services and hundreds of other goods and services necessary to running the school system. The budgetary term used to classify these services is called OTPS (Other Than Personal Service).
The major considerations in OTPS expenditures are quality, cost, and need. In order to get maximum value for each dollar spent, several rules and procedures that cover broad categories of items to be purchased, methods of ordering, and delivery and inspection procedures need to be followed. These regulations and procedures pertain to the entire NYC Department of Education.
The section of the NYS Education Law regarding mayoral control of the schools was renewed and amended during the summer of 2009. The amended law included, among other things, a requirement that most of DOE’s contracts be approved by the Panel for Educational Policy (PEP), as well as certain changes to our current policies and procedures. In order to comply with the new requirements, the DOE drafted a new Procurement Policy and Procedures manual. This manual has been approved by the Panel. It updates certain procurement-related sections of the Standard Operating Procedures (SOP) - OTPS to technically meet the new requirements of the law. Omitted from the Procurement Policy and Procedures are sections from the SOP-OTPS that did not pertain to procurement.
This chapter details regulations governing, and procedures for implementing, purchase orders, requisitions, change notices, and small dollar purchases using the Small Item Payment Process (SIPP). Guidelines for consultant approval forms, and proceed notices, which are used for Full Value Contracts are detailed in separate SOP chapters.
Small cash payments, which are directly related to student activities and which are funded from student and community-generated funds, are issued through the General School Fund. General School Funds are derived from student dues paid to a General Organization (GO) or any other school activity, fines for lost books, sales in a student-operated store and donations or trust funds. These funds may be spent only on the specific student activity for which they were intended. Refer to the SOP on General School Funds and Cash Transactions for additional regulations and procedures.
For all expenditures of OTPS funds, it is the responsibility of the authorizing official to approve only OTPS expenditures that support educational priorities or expenditures related to the “Business of Education.” The authorizing official is responsible for certifying that funds are both available and the expenditure conforms to purchasing regulations and procedures.
There are three areas of concern in making any OTPS purchase:
• The source of the money.
• The nature of the goods or services being purchased.
• The choice of purchasing method.
OTPS funds are categorized as either tax levy or reimbursable. Tax levy monies are provided from the City's General Fund revenues, while reimbursable funds are those provided from special federal, state, city or private grants and allotments. OTPS purchases from reimbursable funds may be further governed by individual program guidelines (i.e., terms and conditions).
1.2.2 The Nature of the Goods or Service Being Purchased The various classifications of OTPS expenditures are identified by the assignment of Object Codes.
Items that may be purchased with OTPS funds are classified in the FAMIS Portal as e-catalog, non-list, and non-contract items. E-catalog items are those for which the Division of Contracts and Purchasing (DCP) has established a contract and have item numbers in the FAMIS Portal under e-catalog. Non-list items are contracted items, but do not have e-catalog item numbers.
To process any purchase efficiently, there are three major considerations:
What is being purchased - is it regulated and controlled?
Is the commodity item contracted or non-contracted?
What is the anticipated cost?
See Purchasing Thresholds for additional information.
Purchasing methods include contracted purchases, non-contracted purchases, P-Cards, and SIPPs.
Contracted purchases consist of E-Catalog, Non-List, Professional Services and Listing Applications.
P-Cards are useful for small emergency purchases, admissions to venues (e.g. museums, conferences, college applications, etc.), postage and other smaller purchases where a purchase order (PO) is impractical.
SIPP (Small Item Payment Process) and formerly referred to as an IMPREST, is an electronic payment mechanism processed through the FAMIS Portal.
A SIPP is used to process payments for non-recurring purchases and should only be used when encumbering
a purchase order is not feasible or practical. A SIPP is generally used for:
Travel and Conference expenditures for NYC DOE employees attending a non-NYC DOE conference or meeting Postage Conference registration Emergency purchases Admission fees Metro cards for public transportation Considerations The maximum amount allowed for a SIPP purchase at the school level is $250. Where appropriate, a transaction a b o v e $250, not to exceed $2500 may be processed (i.e., emergencies), but must be approved by the (FSC).
The maximum allowable amount for a single P-Card transaction is $2,500.
The maximum amount that may be encumbered (spending limit) per P-card at any one time is $15,000.
To purchase non-contracted items costing more than $250, the purchaser must follow bidding procedures.
It is impermissible to attempt to circumvent the purchasing thresholds by making multiple awards to the same vendor within the same fiscal year (also referred to as “split purchase orders”).
A non-recurring purchase does not require bidding if under $250. From $250.01 and above single and/or cumulative purchases to a vendor within a fiscal year bids are required for each transaction, except when purchasing
items under an established system wide contract or for:
Postage, Conference Registration; (subject to pre-approval by direct supervisor) Emergency Purchases PLEASE NOTE: SIPP Rules Were Modified in FY 2016 Beginning in FY 2016, SIPPs greater than $250 require final approval by the FSC Invoices, receipts, agendas, class rosters, etc. must be uploaded in order to initiate a SIPP and a TRAC New sub object codes for 451,452 and 489 See SIPP FY 16 Updates for complete information.
1.2.4 Purchasing/Supporting Documents
The FAMIS Portal is the DOE’s accounting system available through the web. It enables the user to access all financial accounting transactions, related to budget/accounting procurement, and payables.
By using the FAMIS Portal, the user will gain access to budget and expenditure data, and entry of financial transactions.
To enter the FAMIS Portal, the user must first have a FAMIS user ID and password (if you do not have a user ID, please contact your FSC or Head of Office. Based upon your approved user ID, you may have
access to the following applications:
In general, all equipment, supplies, and services purchased with NYC Department of Education funds must serve the Department of Education’s educational and or administrative programs while complying with legal bidding and administrative contractual requirements.
2.1 Authorization To ensure that funds are spent responsibly, all OTPS purchase documents must be authorized by at least one, possibly more Department of Education officials.
The Authorizing Official is responsible for certifying that goods and services being ordered for a school/site are needed to conduct the educational or administrative program, and is in accordance with all NYC Department of Education rules and regulations including bidding and contracts. In a school, the authorizing official is usually the principal or his/her designee. For a program, the director or his/her designee is usually the authorizing official.
Before authorizing a proposed expenditure, the authorizing official must check that the terms and conditions of the agreement, including the exact nature of the items or services to be provided, are specified on the appropriate purchasing document.
The authorized official should be thoroughly familiar with applicable rules, regulations and procedures.
If clarification is needed regarding expenditure or procurement, please contact the Division of Financial Operations (DFO) for expense type (Object Code) or the Division of Contracts and Purchasing (DCP).
2.2 Regulations Governing the Purchasing Process
Consider the following questions before planning a purchase:
• Are funds available in the appropriate codes to make this purchase?
• Does the funding source allow for this purchase?
• Are all Purchasing Guidelines being followed?
• Will the goods or services being purchased further the educational and/or administrative goals of the school or site?
• Will the goods be delivered or services completed within the fiscal year?
In most instances, if an item is available from a contracted vendor, then the purchasing official should order from that vendor. When purchasing from a contracted vendor bidding procedures need not be used. There are instances when it is in the best interest of the Department to use a non-contracted vendor. For instance, if an item can be obtained from a non-contracted vendor for less than the price listed under the Division of Contracts and Purchasing (DCP). Contact DCP when use of a non- contracted vendor is believed warranted. DCP shall review the basis for the request and may exercise discretion in authorizing use of said non-contracted vendor.
2.4 Regulations Related to Cost 2.4.1 Bidding Regulations: New York State Education Law requires that bidding procedures be observed for any purchase of goods excess of $250 and for professional services in excess of $5000. Current regulations specify that a formal contract be established for any purchase in excess of $100,000.
2.5 OTPS Spending – Serving the Needs of Education The following partial listing of expenses is ordinarily NOT permissible. If an exception is made, details regarding this exception are outlined in the respective section.
Note: Before determining that a contracted vendor’s price for an item is more than what it can purchased for from a non-contracted vendor, make certain that all of the “terms and conditions” of your purchase are equivalent (e.g., delivery, installation, warranties, etc.).
2.5.1 Cars Long-term rentals of automobiles are not permitted unless approved by the Chief Operating Officer or his/her designee. However, occasional rental of a car to meet a specific trip or program objective may be permitted. Justification for such a rental must be attached to the expenditure. See SOP “Travel and Conferences” for details.
Fines for moving violations by employees when performing DOE business will not be reimbursed under any circumstances. In most circumstances, parking violations will also not be reimbursed, as well. The operator of the vehicle to whom the parking summons was issued may protest this violation using a NYC Department of Traffic form for this purpose, or appeal to his/her supervisor for payment because of special circumstances related to the illegal parking.