Contract Approval, Signatory, and Reporting Policy

for

Indiana State University

INTRODUCTION

This approval, signatory, and reporting policy relating to contracts at ISU is designed to ensure the following:

1.       Greater continuity in the way contracts are handled,

2.       Greater control over contract negotiations,

3.       Greater safeguarding of the interests of ISU by assuring regulatory compliance and fiscal protection, and

4.       More efficient internal processes. 

In the table below is a list of contracts commonly entered into by ISU, listed by category, with approval and signatory assignment also indicated.  All contracts entered into that do not require Trustee approval are required to be reported at the Trustee meeting following the date upon which the contract is entered into, with the exception of contracts falling under the ISU Purchasing Policy, which contains other reporting requirements.

This document operates to delegate contract power vested in the Trustees by statute to others.  The ISU president and treasurer may further delegate any authority they may possess to approve or execute a contract, but such delegation must be in writing, and may only be made to a vice president or to the controller.

This Policy shall be construed in conjunction with the ISU Purchasing and Receiving Policies and Procedures.

STATUTORY FRAMEWORK

ISU, as a “state supported institution of higher education” is exempted from most of the purchasing requirements applicable to state agencies, with the exception of purchasing preferences relating to “equipment, goods, and materials.”  Therefore, with regard to the purchase of goods and supplies in the daily operation of the university, ISU is bound to follow the purchasing preferences set forth in the Indiana Code, and bound to adhere to its own purchasing policy.

Authority for ISU to contract for professional or expert services, for new construction projects, to rehabilitate or repair capital facilities of the university, and to bond such projects is covered under a variety of Indiana statutes, and special rules apply to these situations.  Special rules also apply to transactions relating to real estate, including leases, and to any transaction that would involve a sale of ISU assets.  Individuals with responsibility for these projects shall communicate and coordinate with University Counsel and the University Treasurer.  Individuals are strictly prohibited from altering State property without appropriate approval.

Indiana law vests authority in the ISU Board of Trustees to approve any student fees, other fees, bonding, and issues relating to compensation and benefits of university employees.  ISU employees are strictly prohibited from implementing any fees, bonding, or making any determinations relating to compensation and benefits that are not first expressly authorized by the ISU Board of Trustees.

Individuals representing ISU should remember that contracts to which ISU is a party can generate revenue for ISU, as well as bind ISU to an expenditure.  Institutional concerns include assurances that the contract is appropriately negotiated, fits within the academic mission of the university, and that ISU possesses the resources necessary to complete requirements under the contract.  All contracts must have an attached routing form that is completed before the signatory can execute the contract.  No routing form can be altered in the approval process; all comments in the approval process shall be reflected on the routing form for purposes of reference.  In any contract that binds ISU to an expenditure of funds, the ISU Treasurer, or the Treasurer’s delegate, must verify the funding source and sign the routing form prior to execution of the original contract or any change orders to the original contract.  A ‘notice to proceed’ is viewed as a contractual commitment.

SPONSORED PROGRAMS

Sponsored programs refers to the receipt of funds from an external sponsor to support the research, creative, training, and service activities of ISU faculty members, staff members, and students.  At ISU, the Office of Sponsored Programs (OSP), located in the Office of the Provost and Vice President for Academic Affairs, is the pre-award administrative office that is responsible for:  (a) activities in support of sponsored programs up to the notification and acceptance of the award by the sponsor, (b) activities related to reporting and renewal during the period of the award, and (c) non-financial activities related to closing out the project at the end of the period of the award.  The OSP plays a parallel role to purchasing, except that funds are revenue to the university and not expenditures.  The off ice that provides post-award administrative support (primarily financial) for ISU sponsored programs is the Office of Grants and Contracts (OGC), located in the Office of Planning and Budgets.

The Chief Research Officer (CRO) has approval and signatory authority for sponsored programs.  That is, the CRO is responsible for approving, on behalf of the university and the Principal Investigator (PI), all sponsored program applications and proposals submitted to external sponsors, and for accepting, in behalf of the university and the PI, all awards by external sponsors to the university for sponsored programs.

The main needs in the area of sponsored programs are  (a) to ensure that a proposed project is appropriate to the mission of ISU, (b) that there are facilities and sufficient resources to achieve the specified scope of work, and (c) that the operation of a sponsored program complies with all applicable state and federal laws, and with the regulations and policies of all external sponsors in areas such as research with human subjects, animal care and use in research, misconduct in science, conflict of interest, electronic research administration, nondiscrimination in research, laboratory safety, biohazard and radiation safety, research with recombinant DNA molecules, drug free workplace, procurement integrity, intellectual property, and technology transfer.  There exist procedural controls and the attendant skill and ability in the executive, administrative, and professional staffs of the OSP and the OGC to safeguard the interests of ISU during proposal development, award negotiation, project implementation, and project closeout, and to ensure compliance with all financial, legal, and ethical parameters of sponsored programs.

The primary criteria that would lead to an agreement being assigned to the OSP include:

·         An award instrument that binds ISU to a scope of work that is specified to a substantial level of detail

·         A stipulated period for performance of the scope of work

·         A line item budget with specific limitations, cost accounting standards, and financial controls

·         Specific billing requirements, such as fixed price or cost reimbursement

·         Financial reports that are required to be filed with the sponsor and expense records that are subject to audit

·         Recovery of the costs to ISU of the use of facilities and of administrative services to undertake the sponsored program

·         Stipulation of the disposition of tangible or intangible property used by or resulting from the sponsored program, including funds, equipment, records, data rights, copyrights, research-related materials, inventions, and other intellectual property

The primary types of program sponsorship agreements handled by the OSP and OGC are:

·         Grant.  A grant is the appropriate agreement to be used in a relationship between a sponsor and a recipient whenever:  (a) the principal purpose of the relationship is the transfer of money, property, services, or anything of value from the sponsor to the recipient to accomplish a public purpose; and (b) no substantial involvement is anticipated between the sponsor and the recipient during the accomplishment of the public purpose.

·         Contract.  A contact is the appropriate agreement to be used in a relationship between a sponsor and a recipient whenever the principal purpose of the relationship is the acquisition, by purchase, lease, or barter, of property or services for the direct benefit or use of the sponsor.

·         Cooperative Agreement.  A cooperative agreement is the appropriate agreement to be used in a relationship between a sponsor and a recipient whenever:  (a) the principal purpose of the relationship is the transfer of money, property, services, or anything of value from the sponsor to the recipient to accomplish a public purpose; and (b) substantial involvement is anticipated between an agency, acting for the sponsor, and the recipient during the accomplishment of the public purpose.

The primary sources of program sponsorship include:

·         Municipal, county, state, or federal governmental agencies

·         Foreign government agencies

·         International nongovernmental organizations and agencies

·         Local, state, regional, or national business and industry

·         Private foundations (This refers to grants made to ISU from foundations and not gifts received by ISU.  Grants from foundations are handled by the OSP, and gifts are handled by the ISU Foundation.)

·         Other, including other universities or research institutes as subcontracts

The primary purposes of program sponsorship include:

·         Research

·         Training, instruction, and education programs

·         Public service

·         Equipment purchase

 

CATEGORIES OF CONTRACTS

	APPROVAL	SIGNATORY
Professional and Expert Services
1.  Rehabilitation and Repair	If under $500,000, then Purchasing If $500,000 and up, then Trustees and State.	If under $500,000, then Purchasing If $500,000 and up, then Treasurer
2.  New Construction	If under $200,000, then Purchasing If $200,000 and up, then Trustees and State	If under $200,000, then Purchasing If $200,000 and up, then Treasurer
3.  Consultants	If under $50,000, then President If $50,000 and up, then Trustees	President
Other Services*	In accordance with the ISU Purchasing Policy	Purchasing, in accordance with the ISU Purchasing Policy
Employment Contracts	Trustees	President or Trustees
Legal Services	President	General Counsel
Performers, Speakers, and Entertainers	If under $50,000, then President If $50,000 and up, then Trustees	President
Goods	In accordance with ISU Purchasing Policy	Purchasing, in accordance with ISU Purchasing Policy
Financial**	Trustees	Treasurer
Third Party Payment of Student Costs	Treasurer	Treasurer
Affiliation Agreements	Provost or Treasurer	If no financial commitment, then Provost.  If financial commitment, then Treasurer
Internships
1.  Voluntary	Provost	Provost
2.  Student is paid	Student must also be a party to the contract; ISU approval, if any, is Provost.	Student must also sign the contract; ISU signatory, if any, is Provost.
3.  ISU is paid	If under $50,000, then Provost If $50,000 and up, then Trustees	Treasurer
New Construction	In accordance with statute	In accordance with statute
Sponsored Programs	Chief Research Officer	Chief Research Officer
Athletics
1.  Team play	Director of Athletics	Director of Athletics
2.  Advertising	Purchasing	Purchasing
3.  Referees	Director of Athletics	Director of Athletics
4.  Game Officials	Director of Athletics	Director of Athletics
Real Estate
1.  Lease of space (other than in conjunction with performers, speakers, and entertainers)	If term is 4 years or less, and no bonding, then President If term is greater than 4 years, then Trustees and State	President
2.  Purchase or Sale of Real Estate	Check with legal affairs for compliance with State law	Check with legal affairs for compliance with State law

*  “Other Services” might include collection services for the Office of the Controller.

** If an independent delegation of authority relating to a particular area or matter is vested in the Treasurer by the Trustees, then the Treasurer may act under such delegation of authority, reporting results to the Trustees at the next meeting following action taken by the Treasurer pursuant to such independent delegation of authority.

 

 

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