TO:             Fiscal Policy Users

FROM:           William Aiken, Acting Vice Chancellor for Business and Finance

DATE:           August 30, 1999

RE:             Fiscal Policy Revisions


The latest revisions to the UT Fiscal Policy Statements are found in
Section 030 on Petty Cash, Section 050 on Purchasing, and Section 130 on
Contracting.  The changes are highlighted below:

SECTION 030 ON PETTY CASH:
Petty cash purchases may be made up to $2,000 for a single-item purchase.


SECTION 050 ON PURCHASING:
As a result of an internal audit of the University's contracting process,
the most significant revisions to this policy are as follows:

        Bidding Policy - Departments may now purchase goods and services for
        $2,000 or less without a purchase order.  Purchasing will make all
        other purchases above $2,000, informal bids will be solicited for
        purchases over $2,000 and under $10,000, and sealed bids will be
        required for purchases of $10,000 and higher.  Additional approvals
        may be required for construction contracts.

        Petty Cash - See above.

        Commercial Services - Commercial services were added to the
        procurement responsibilities of campus purchasing departments.

        Non-Competitive Purchases - The criteria for the non-competitive
        purchase of goods/services were revised to provide better guidance
        for reviewing such requisitions/contracts.  A required justification
        form was created for departments to use when requesting these
        requisitions and contracts.

        State Audit Concern - The wording in the policy was changed to
        "solicit" rather than "obtain" when referring to the bid process.


SECTION 130 ON CONTRACTING:
Several changes have been made as a result of comments from legal counsel
and internal audits.  The revisions are summarized below:

        A formal contract is not required for non-competitive services
        costing less than the bid limit established for department use.
        Verbal agreements are no longer allowed when contracting with
        individuals for short-term services.

        When the contract term exceeds three months, contractors must
        produce progress reports and departments must find the work
        adequate before authorizing the next payment.

        Negotiation principles were added to the discussion of verbal
        negotiation.

        New documentation requirements were added for contracts with
        corporations.

        The original, fully executed contract must now be sent to the
        Treasurer's Office for the official files.

        The criteria for the non-competitive purchase of goods/services
        were revised to provide better guidance for reviewing such
        requisitions/contracts.

        A required justification form was created for departments to
        use when requesting non-competitive purchases and contracts.

The above revisions are only summarized.  These fiscal policy revisions can
be found in their entirety at
http://solar.cini.utk.edu/ams/5030.htm,http://solar.cini.utk.edu/ams/5050.ht
m, and http://solar.cini.utk.edu/ams/5130.htm.

WA:smj


William C. Aiken
Acting Vice Chancellor for Administration and Finance
The University of Tennessee at Chattanooga
Phone: (423) 755-4393  FAX: (423) 755-5291
E-mail: [log in to unmask]