THE UNIVERSITY OF MEMPHIS OPERATING PROCEDURES
SUBJECT: Contracts and Agreements
PROCEDURE NO.: 2D:03:07A DATE: January 1, 1990
SUPERSEDES PROCEDURE NO.: 2D:03:07A DATED: October 1, 1986
Contents
I. Purpose. . . . . . . . . . . . . . . . . . . . . . . . . 1
II. General. . . . . . . . . . . . . . . . . . . . . . . . . 1
III. Procedures . . . . . . . . . . . . . . . . . . . . . . . 1
IV. Guidelines and RequIrements. . . . . . . . . . . . . . . 2
I. Purpose
To outline requirements and procedures for processing contractual
documents other than employment contracts.
II. General
Only the President and those individuals who are specifically
authorized in writing by the President through published policies/
procedures or other authorizing documents (including, but not
limited to, the Vice President for Business and Finance and the
purchasing agent) have the authority to enter into contracts and/or
agreements as the agents of the University.
III. Procedures
All proposed contractual documents requiring the President, the
Vice President for Business and Finance, and/or the Purchasing
Agent's signature must be reviewed and concurred in by the
department/activity chairman or head, the dean of the college or
school (if applicable), the vice provost/vice president or
University official to whom the chairman or activity head is
responsible, and the Vice President for Business and Finance, who
will forward the document to the President or Purchasing Agent
for signature when he does not execute the same. (Copy of routing
form attached.) Along with the contract document and routing
form, the department must include a memorandum of explanation and
justification.
IV. Guidelines and Requirements
1. All agreements and contracts involving or related to the
following areas shall require the approval of the President of
the University and the Chancellor of the Tennessee Board of
Regents:
a. The purchase of real property;
b. The lease of real property where the University is the
lessee;
c. The leasing of University property for more than five (5)
years or more than $15,000 per year;
d. Purchases related to capital outlay projects;
e. The purchase of insurance or agreements providing insurance
or other benefits for employees (with the exception of
tax-deferred annuity salary reduction agreements);
f. All professional, personal or consultant service agree-
ments required to be submitted to the Board for approval
in accordance with The University of Memphis Operating
Procedure No. 2D:03:07B, "Agreements for Personal, Pro-
fessional, and Consultant Services."
g. All agreements and contracts involving or related to the
purchase of data processing equipment required to be
submitted to the Board for approval in accordance with
The University of Memphis Operating Procedure No.
2D:03:05C, "Contracts for Acquisition of Hardware,
Software and Related Services."
2. No agreements of any nature which require the expenditure of
funds by the University shall extend beyond the end of the
fiscal year in which they are entered into unless expressly
subject to the condition that the University shall have the
right to terminate such agreements at the end of any fiscal
year in the event that sufficient funds are not appropriated
by the General Assembly and/or budgeted for continuation of
the agreement.
3. No agreement of any nature shall be entered into which:
a. Provides that the University shall purchase liability
insurance or performance bonds, or indemnify or hold
harmless any other party;
b. Provides that the University shall pay taxes from which
the University is exempt by law;
c. Provides for the payment of interest, late charges,
liquidated damages or penalties of any nature by the
University (with the exception of restocking charged on
items returned for credit and forfeiture provided under
athletic game contracts);
d. Contains any provision concerning default by the
University, consent to arbitration, commencement of any
legal proceedings, or payment of attorneys' fees;
e. Provides for advance deposit or prepayment for any goods or
services, except for books and publications, conferences,
and other small items or services for which prepayment is
necessary in the ordinary course of business, provided the
amount does not exceed $1,000.00;
f. Provides for a disclaimer of vendors' liability for inci-
dental, exemplary, consequential damages, or limitations
on dollar amount of damages recoverable by State from ven-
dor; or
g. Provides for a disclaimer by vendor of express or implied
warranties of merchantability and fitness for a particular
purpose, unless the agreement is expressly subject to
approval of the Chancellor of the Tennessee Board of Regents.
4. The President shall approve all applications for grants from
agencies or organizations, provided that for where matching
funds or services in lieu of funds are required by the
University, no application shall be made unless the operating
budget provides the funds and/or resources necessary for the
project. The President shall accept the award of a grant, and
enter into agreements confirming grants, provided that the
acceptance of grants and agreements confirming the award of
grants shall be subject to sections 2 and 3, supra.
5. Any agreement between the University and any other institution
or school, agency, organization, or entity which involves
programs relating to matters of System-wide interest, or any
agreement which provides for the coordinated or cooperative
offering of any credit or non-credit programs or activities or
in which certificate or degree requirements are met or credit
is given for coursework or activities offered by another
institution or school, shall be approved by the President and
the Chancellor. Examples of such agreements include provisions
for either credit or non-credit academic programs or public
service activities to private or state agencies and institu-
tions or schools in the fulfillment of that agency's respons-
ibility for State-wide services or governmental training, and
agreements which require consortia or cooperative arrangements
with other institutions or schools, agencies, or associations.
This section does not apply to agreements concerning informal,
locally arranged activities generally considered to be in the
purview of the University in the fulfillment of its role in
community services or in providing student learning experiences
as are seen in arrangements to provide student teaching experi-
ences in the local public school systems.
6. In any agreement which requires participation by an applicant,
student or employee of the University in an education program
or activity conducted in whole or in part by any other person
or organization, or which facilitates, permits or considers
participation by such persons as part of or equivalent to an
education program or activity of the University, the
University shall require the person or organization to agree
that no person shall, on the basis of race, religion, creed,
color, sex, age, handicap, or national origin, be excluded
from participation in, be denied the benefits of, or be
subject to discrimination under the education program or
activity. Breach of this provision shall be cause for
termination of the agreement.
7. For all agreements, contracts, and subcontracts concerning
Clinical Affiliation, Personal and Professional Services, Dual
Services, Use of Facilities, Computer Hardware and Software,
and Banking, please refer to specific procedures in the
Procedures Manual.
8. All agreements, contracts, and subcontracts shall contain all
necessary nondiscrimination requirements provided by Federal
or State laws and regulations.
9. All contracts and agreements requiring the approval of the
Chancellor shall contain the following provision:
"This agreement shall not be binding upon the parties
until it is approved by the Tennessee Board of Regents."
10. In accordance with the Tennessee Small Business and Minority
Owned Business Purchasing and Contracting Act, T.C.A. Section
12-3-801 et seq, the University is required to actively
solicit bids from small businesses and minority owned
businesses whenever possible in order to purchase a fair
proportion of purchases from small businesses and minority
owned businesses. A small business in the service industry
is a business which is independently owned and operated, is
not dominant in its field of operation, has gross annual
sales of $500,000 or less, and has nine (9) or less
employees. A minority owned business is a business which is
solely owned, or at least fifty-one percent (51%) of the
assets of outstanding stock of which is owned, by an
individual who personally manages and controls the daily
operations of such business and who is impeded form normal
entry into the economic mainstream because of past practices
of discrimination based on race, religion, ethnic background,
or sex.
11. Questions relating to the legal aspects of contracts should
be referred to the Office of University Legal Counsel. A
legal review will be completed, however, at the time proposed
contracts are processed by the Office of the Vice President
for Business and Finance.
ATTACHMENT I
COORDINATION/ROUTING FORM FOR
CONTRACTUAL DOCUMENTS
DATE: ___________________
TO: (IN TURN)
*___________________________________ _____________________________________
Initials/Remarks Date
___________________________________ _____________________________________
Department Chairman/Activity Head Initials/Remarks Date
___________________________________ _____________________________________
Dean/Director Initials/Remarks Date
___________________________________ _____________________________________
Concerned Vice Provost/Vice Initials/Remarks Date
President
Mr. John W. Cothern
___________________________________ _____________________________________
Administrative and Business Initials/Remarks Date
Services
Dr. R. Eugene Smith
___________________________________ _____________________________________
Vice President for Business and Initials/Remarks Date
Finance
Attach hereto is a copy of a proposed contract between The University of
Memphis and _____________________________________ which has been requested
by ___________________________________.
Prior to final execution of this contract, please indicate your concurrence
or nonconcurrence and forward to the next listed official.
* A memorandum of explanation and justification detailing why and how this
contractor was selected and how the fee to be paid, if any, was calculated
must be routed with the contract.