Contract Administration Workshop Presented by: Lorie Messer NOTES; INTRODUCTION How many of you are involved with contracts in you dept.? How many of you are familiar with TAMU-CC contract forms? Hopefully this workshop will provide you with a firm understanding of the responsibilities associated with Contracts and the fundamental skills which can be used to improve contracting practices within our University.

Objectives of the Workshop Definition & basics of a contract Responsibilities of the Department Success & Challenges of Contract Administration How to review a contract Different types of contract forms Contract *Delegation of Signature Authority Notes: Feel free to ask any questions…. Cover Contract Planning – What is the Need? Procurements methods – PO or NON-PO Contract Formation- Proper Scope of Services Compensation Methods or no Compensation Different Forms to use Check list

Definition of Contract A binding agreement between two or more persons or parties; especially: One legally enforceable. A business arrangement for the supply of goods or services at a price. Contracts are agreements which create an obligation to do or not do a particular thing. Written contracts should be executed whenever TAMU-CC enters into a binding agreement with another party that involves any stated or implied consideration. Notes NO Oral Agreements – they are not binding – Unless under $500 the UCC (Uniform Commercial Code) does not require contracts under $500 but most dept. do it anyway because you have to have an invoice. Examples: Cooperative Agreements: a combination of a group of vendors, agencies or Universities – for the purpose to lower the cost based on volume purchase E&I, DIR, Buy Board, TXMAS

Definition of Contract Continuation Contracts are construed to include, but not be limited to, the following: Purchase Orders, Agreements, Cooperative agreements, Memorandums of Understanding, Interagency contracts, Grants, Loans, Easements, Licenses, Leases, Permits & Restrictions on acceptances of gifts, Stipends & Bequests (will). Other parties include, but are not limited to: Federal, state and local agencies, non-profit organizations, private businesses, partnerships & individuals. Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

“Contract Administration” Built Upon Six Questions What is to be accomplished by this agreement? Ensure the contract contains provisions that hold the contractor accountable for producing desired results. Stay within budget. Has to be clearly understood & defined. How is this project to be accomplished? Involvement must be present from the start. Does a certain sequence need to be performed in an orderly fashion? Yes, through the Procurement Cycle sequence needs to be identified. Notes The Primary duties of a Contract Administrator are monitoring vendor performance, approving payments, and managing contract changes.

“Contract Administration” Built Upon Six Questions When should these objectives or steps be satisfied? During the term of the Contract. Who are the responsible parties? The party responsible for delivering the goods. What is the cost & payment terms? Important: Know how the cost was calculated. Terms are net 30 days after receipt of goods. Notes The CA should also be involved throughout the procurement process so they are familiar with the contract requirements and the expectations of the end user.

6- Factors to create a Contract An offer & Acceptance Legal Purpose Mutuality of Obligation, also known as “meeting of the minds” Consideration Certainty of Competent Parties Subject matter Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Contract Administration Contract Administration is often one of the most neglected parts of the procurement process. Good Contract Administration requires dedication and persistence. The intensity and manner of contract administration will depend of the type of contract involved. Small dollar contracts with short durations or procurements for a one-time purchase may take less administration than those for large dollar projects of a lengthy duration. Contract Administration is a critical element in the procurement cycle, and must be carried out in all public purchasing operations. Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Contract Routing Cycle Read Contract and have a full understanding If it involves $$$ - Create a limited or Requisition in FAMIS & route for approval If no $$$ involved – Fill out Contract Transmittal form & have department head sign Route Contract to Purchasing Dept for review Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Cont… Contract Coordinator will review and/or modify, & contact the Company with any changes. Reviewed contract will be given to the Buyer if it is encumbered in a Requisition or send back to the Dept. if it’s on a Limited. If the Contract is encumbered on a Requisition, the Purchasing Dept. will mail out to the vendor for signature and provide the Dept. with a copy.

Contract Management Plan: Identify contracting objectives & contracting strategies Procurement: Fairly & objectively select the most qualified contractors Contract Formation: Ensure the contract contains provisions that hold the contractor accountable for producing desired results Rate/Price Establishment: Establish processes that are cost-effective & aligned with the cost of providing the goods & services Contract Oversight: Monitor & enforce the terms of the contract and completion of contract DON’T FORGET TO SET UP THE VENDOR IN FAMIS SYSTEM! Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

TAMU-CC Contract Addendum Form to Vendor’s Contract Used to expedite vendor’s Contracts Has all TAMU-CC Terms & Conditions Legally binding Can be found in our Website http://falcon.tamucc.edu/~purchase/ Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Determining TAMU-CC Employee or ‘Independent Contractor’ (20 Factor test form) Must fill out 20 Factor Test FORM to make the determination 20 Factor Test form needs to be routed through Purchasing Dept. Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

An Employee is An individual who performs a service for the University and is working under the direction & control of the University & its employees. Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Independent Contractor ☻Is an individual engaged by the University to perform a specific task & who is free to perform this task completely at the individual’s own discretion with regard to means & methods. Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Definition of Contract Workforce The State of Texas defines “Contract Workers” as: ▪ Independent Contractor’s ▪ Temporary workers (supplied by staffing company) ▪ Contract company workers ▪ Consultant (means the practice of studying & advising a University in a manner not involving the traditional employer/employee relationship). If a contract is over $10,000 & using “State funds”, a Contract Work force analysis form must be completed & sent to the Purchasing Department. Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Contract Workforce Requirements Continuation P-2 ●The contractor’s “Work force analysis form” could be audited & reviewed by the State Auditors Office in Austin. ●Must ensure that the contract worker fits into the Universities goals & objectives including: ● Compensation cost ● Productivity ● Nature of services to be provided ● The workload Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

TAMU-CC Contract/Agreement Short Form Used for Contracts under $50,000 Page -1- Must fill out All the information Page -2- to Enter Detail Costs if not lump sum Page -3- Instructions for completing the form Can be found in our website!!! Not in your bundle…added it at the last minute to go over the form.

Misc. Contract Information Dept. Heads can sign up to $5,000 ONLY if using “TAMU-CC Contract Form” Should not exceed Five (5) Years If Contract exceeds 5-years, must be approved by the “Board of Regents” If over $50,000 needs Legal Review Real Estate, regardless of $ needs to go through TAMUS for review Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Areas where Contract Administrators are involved: Meets Milestones Avoid “Risk” Regarding Liabilities Communicate Internally and Externally Maintain a Professional Relationship Ensuring Compliance of the Contract Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Ethics in Administering a Contract Integrity Fair Dealings Confidentiality Keep Favorable the Relationship Maintain Impartiality - Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Reasons for Problems in Contract Administration Lack of Effective Communication Inadequate Record keeping Improperly Developed Specifications “Fuzzy” Language Lack of Timely Notices Unable to Meet Terms Poor Selection of Contractors Improper Reimbursement Methods - Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Compensation Section Price set amount Fixed Price Contract Cost Plus Expenses Hourly Rate - Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Contract Termination Termination Conveniences Default - Failure to Meet Contractual Obligation Goes into Bankruptcy Upon Tender of Notice to Seller Conveniences Default - Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Satisfactory Completion Prepare Final Contract closeout and Inspection Properly Close File w/all required documents Notify Purchasing Department of Contractor’s Performance Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Delegated Authority TAMU-CC Sponsored Programs Services & Goods Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________ Certain Contracts Must be Approved by the Board of Regents Refer to TAMUS Policy 2507)

Delegation of Authority To determine who is “authorized” to sign any type of Contracts refer to the 2007 TAMU-CC Delegation of Authority for Contract Administration. This form can be found in our Website: http://falcon.tamucc.edu/%7Epurchase/ Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

ARAMARK CONTRACT Has “exclusive” rights for campus food & catering READ Food Services “Campus Food services Rules” for exemptions MUST fill out form – and be Approved before you can be exempt For more info Contact: Liz Atkinson X-5710

Texas A&M University-Corpus Christi “Contract/Agreement" Form Approved by the Office of General Counsel “Template” to use for TAMU-CC agreements- Fill in the blanks (i.e., Scope of Services) Make sure you select the correct information that applies (i.e., Reimbursement for travel, etc.) Has all TAMU-CC terms & conditions

TAMU-CC Contract Review Checklist Form This is suggested as a useful tool for your department. It is not mandatory. It is intended as a guide only.

TAMU-CC Contract Review Checklist Form This is suggested as a useful tool for your department. It is not mandatory. It is intended as a guide only. Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Texas A&M University Contract Administration Need Contact: Lorie Messer Contract Coordinator Lorie.messer@tamucc.edu Tel: 825-2166, Fax 825-2772 Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

The End Texas A&M University-Corpus Christi Purchasing Department Judy Harral, Purchasing Director 361-825-5936 Lorie Messer, Contract Coordinator 361-825-2166 Notes:_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________ http://falcon.tamucc.edu/~purchase/