MEMORANDUM
To: Distribution
From: Scot M. Faulkner
Chief Administrative Officer
Subject: Revised Purchase Order Procedures
Date: [June 4, 1996]
As I indicated in my Purchase Order Procedures Memorandum of April 23, 1996, revisions will be necessary as we implement the Federal Financial System (FFS). This Memorandum makes the first set of those revisions, to be utilized for at least the month of June during the start-up phase of the Purchasing Subsystem implementation, for each purchase order (PO) dated June 1, 1996, or later. Purchase orders dated prior to June 1st will continue to be processed in accordance with the April 23rd Memorandum, until such time as all such PO=s have cleared the system.
During the start-up phase of the Purchasing Subsystem, PO=s will be entered into the system by program office personnel utilizing computers in Rm. 204, O=Neill HOB. After June, and when the system is certified and we are satisfied it is functioning properly, it is anticipated that CAO units will begin entering purchase order data directly into the system at the point of origination. At that time, appropriate additional procedural revisions will be issued as needed.
I have also delegated purchase order approval authority to designated individuals, based on the following categories. First, value. Authorized approval levels for those individuals are:
(1) up to a maximum of $500, (2) up to a maximum of $2,500, (3) up to a maximum of $10,000, and (4) those exceeding $10,000. Secondly, purchase orders of whatever dollar value must be approved by the CAO or Administrative Counsel, if the purchases are for goods and/or services for offices of the CAO. Additional delegations to designated individuals in program offices are anticipated as the system matures.
Finally, to implement audit recommendations, a set of standard terms and conditions has been developed which must be attached to the vendor copy of all purchase orders. A copy of the standard terms and conditions is attached, and they may also be accessed from the CAO server under f:data/common/procdocs/trmscond.wpd.
Subject: Purchase Order Procedures
Page Two
Accordingly, effective this date, my Memorandum of April 23rd is superseded and replaced in its entirety by this Memorandum for those purchase orders dated June 1, 1996, or later, and the following procedures must be followed for each such PO initiated in your office:
1. Prepare PO=s following the process established in your office to assure the purchase is appropriate and done in accord with House rules and policies, including the Procurement Guidelines. Attach a copy of the purchase order Standard Terms and Conditions to the vendor copy of each PO.
2. Include on the face of each PO the following information under the disclaimer AFor CAO use only@:
(a) Payment Plan. For applicable PO=s (e.g., equipment), cite whether the purchase is a one time or three year purchase, or a two year purchase for District Office telephone equipment.
(b) Fiscal Year. Cite the appropriate fiscal year against which funds are to be obligated.
Example: AFor CAO use only: 3 yr. purchase. FY= 96.@
3. Also include on the face of each PO:
(a) Contract number. If the PO is being issued pursuant to a House, GSA or other Federal agency contractual agreement, cite the applicable contract number (or bid number, where appropriate). Example: Contract #CAO-HIR-95-0000-L. If the PO is not being issued pursuant to a contractual agreement, please note words to the effect of ANo parent contract.@
(b) The Delivery Date or A30 Day AOR@ (After Order is Received). The Delivery Date is a key element of performance criteria and indicates the date by which goods are to be delivered or performance of service is to begin. When there is not a specific delivery date required or desired, the Adefault@ delivery date becomes A30 Day AOR,@ i.e., delivery is expected to occur within 30 days of receipt of the order by the vendor.
4. The signature block on all PO=s shall read AContracting Officer@ in lieu of AChief Administrative Officer,@ and not have any name printed with the signature block.
5. The Associate Administrator of the initiating CAO office must initial each PO as the originating official.
Subject: Purchase Order Procedures
Page Three
6. Purchase orders must be separated into two primary signature type batches:
(a) PO=s exceeding $10,000, as well as those for CAO offices. Place in BLUE file folders.
(b) PO=s not exceeding $10,000, excluding those for CAO offices. Place in GREEN file folders.
7. GREEN batch purchase orders must be further subdivided along dollar approval level lines, i.e., PO=s which do not exceed $10,000 and are for non-CAO offices, must be placed in separate GREEN file folders as follows: (a) those not exceeding $500, (b) those exceeding $500, but not exceeding $2,500, and (c) those exceeding $2,500, but not exceeding $10,000.
8. Program offices will bring PO=s to Rm. 204 O=Neill for entry into the purchasing subsystem by their personnel in accordance with scheduled times developed in conjunction with OPP. After PO=s are entered, they will be transferred to OPP custody for further
processing, tracking and compliance review. PO=s which cannot be entered, for whatever the reason may be, remain the responsibility of the program office until such time as the problem is resolved.
9. When GREEN folder PO=s are approved and signed (or rejected), they will be returned to the originating offices. BLUE folder PO=s will be sent to the CAO=s office for approval. After the latter PO=s are approved and signed (or rejected), the CAO=s office will return them to OPP. OPP shall make final distribution of all PO=s to the originating offices.
I realize that these new procedures include additional requirements. They will, however, be worth it in that they will, in combination with delegated approval levels, expedite the purchase order approval process. At the same time we will be taking another step forward in building a sound, auditable procurement process for the House. And when Procurement Desktop is fully implemented, most of these paperwork requirements will be history.
The points of contact for purchase order processing are Grant Graessle, x60842, and Diane Hill, x52921, in the Office of Procurement and Purchasing.
Distribution: Associate Administrators Gloria Wright-Simmonds
Mike Dorsey Gail Henkin
Tom Simon Procurement Broadcast System
U.S. House of Representatives - Standard Terms and Conditions
1. This order expressly limits acceptance to terms and conditions stated herein. Any additional or different terms and conditions proposed by the Vendor are rejected unless expressly agreed to by the House in writing. If Vendor commences shipment pursuant to this order, then Vendor shall be deemed to have agreed to and accepted this order in its entirety, including its terms and conditions as set forth herein.
2. Vendor warrants free and clear title to all products delivered hereunder and further warrants that such products shall be merchantable, free from defects in workmanship, material or design (other than the House=s design) and shall conform either to the description and specifications herein set forth or consistent with the sample of said product provided to the House.
3. Items purchased hereunder are subject to inspection and approval at the House=s destination. The House reserves the right to reject and refuse acceptance of items which are not in accordance with any instructions, specifications, drawing and data or Vendor=s warranties (express or implied). Products not accepted will be held for Vendor=s instruction at Vendor=s risk and, if Vendor so instructs, will be returned to Vendor at Vendor=s expense. Payment for any items hereunder shall not be deemed an acceptance thereof and is without prejudice to any and all claims that the House may have against Vendor.
4. Unless otherwise specified in this order, items are to be of the growth and manufacture of the United States, provided such items are upon as good of terms regarding quality and price as like items of foreign growth and manufacture.
5. If the Vendor cannot deliver the items in this order in the time specified, the Vendor should notify the House prior to the delivery date. Failure to meet delivery dates shall, at the option of the House, without liability, in addition to other rights and remedies of the House, relieve the House of any obligation to accept and pay for any such items.
6. Except as otherwise provided in this order, no variation in the quantity of an item, nor any extra items or charges will be accepted unless agreed to by the House.
7. Vendor shall not be liable for failure to deliver products when prevented by any cause beyond its control, and the House shall not be liable for failure to accept products when prevented from receiving or using them in its customary manner by any cause beyond its control. A party who is prevented from performing for any reason provided for herein shall immediately notify the other party of the cause of such non-performance and the anticipated extent of the delay.
8. The House is exempt from all taxes, including any sales and use taxes.
9. Invoices shall be mailed at time of shipment and any cash discount period will be computed from the date invoice is received. Terms shall be net thirty days unless otherwise stated herein.
10. All freight charges shall be invoiced, unless otherwise stated. Risk of loss and title to the product shall pass at delivery points specified herein - on loading where delivery is at shipping point and on unloading where delivery is at destination.
11. Vendor warrants that the products, in the form delivered to the House, are free from any valid claim for patent infringement and that any labels or trademarks affixed thereto by or on behalf of Vendor are free from any valid claim for copyright or trademark infringement and agrees to save and hold harmless and indemnify the House against such infringement liability based upon the House's possession thereof without alteration.
12. Vendor warrants that the products sold or services furnished under this order have been produced or furnished in full and complete compliance with all applicable laws and regulations. Vendor agrees to execute, upon the House=s request, the House=s standard form of Certification of Compliance covering any law or regulation, which Certification of Compliance form, upon execution by Vendor, shall become a part hereof without further reference thereto. Vendor further agrees to hold the House harmless from any and all liabilities, claims, fines, penalties, including reasonable costs and settlements, which may arise out of the delivery by Vendor of items which do not meet the requirements of any applicable laws or regulations.
13. The House shall not be liable for any injury to the Vendor=s personnel or damage to the Vendor=s property unless such injury or damage is due to gross negligence on the part of the House.
14. Vendor assumes all risk of loss of or damage to any property of the House entrusted to Vendor while in Vendor=s possession or otherwise under Vendor=s control. In the event of loss or irreparable damage, Vendor shall promptly reimburse the House for the value of the article. Any other damage shall be promptly repaired by Vendor at Vendor=s expense.
15. The House has the right to terminate this order in whole or in part at any time by written notice to Vendor. In such event, Vendor may claim only properly supported out-of-pocket costs plus a reasonable amount of demonstrable related charges for the work already performed, all to be determined in accordance with generally accepted accounting procedures. For specially prepared products, unique to the House=s order, any partially completed work or raw materials whose full costs are included in the termination charges shall be identified in writing and held by Vendor for disposition in accordance with the House=s written instructions. Notwithstanding the foregoing, the House reserves the right to cancel all or any part of the undelivered portion of this order, without liability, in addition to the House=s other rights and remedies, if Vendor breaches any of the terms and conditions herein.
16. This order may be terminated if it is determined by the House that a gratuity (e.g., an entertainment or gift) was offered or given to any Member, officer, or employee of the House with the intention of obtaining this order or gaining favorable treatment under this order. No Member, officer, or employee of the House shall share any personal benefit of this order.
17. Neither this order nor the obligation of Vendor to perform hereunder shall be assigned or delegated by Vendor without the House=s consent. Waiver by either party of any default by the other hereunder shall not be deemed a waiver by such party of any other, subsequent default. None of the provisions, terms and conditions contained in this order may be added to, modified, superseded or otherwise altered except by a written instrument signed by the authorized representative of the party against whom its enforcement is sought, and each shipment received by the House from Vendor shall be deemed to be only upon the terms and conditions contained herein regardless of any contrary or additional provisions contained in any acknowledgement, invoice or other form of Vendor and not withstanding the House=s act of accepting or paying for any shipment or similar act of the House.
18. This contract may be terminated in whole or in part by the House upon two (2) months written notice to the other party.
19. No news releases, press conferences, or advertisements pertaining to the award of this order will be made without prior written approval of the House.
20. If this order is given pursuant to any existing contract, it is also subject to the terms of such contract, and such terms shall control in the case of any conflict with the provisions hereof.
21. This contract shall be governed in accordance with House Rules and regulations and all applicable statutes regarding performance and any dispute arising therefrom.
22. Availability of Funds - The House=s obligation under this contract is contingent upon an appropriation of funds from which payment for this contract can be made. No legal liability on the part of the House for any payment may arise until the funds are appropriated to the Contracting Officer for this purpose.
June, 1996
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