Effective July 1, 2005
Amended April 1, 2009
Pursuant to Section 24-101-105 of the C.R.S., on January 20, 2005, the Board of Regents adopted a resolution exempting the University of Colorado from the State of Colorado Procurement Code and Rules to be effective July 1, 2005.
The Constitution and statutes of the State of Colorado vest the supervision of the University in the Board of Regents, which includes the authority for Procurement. The Board of Regents has delegated to the President the administration of the University pursuant to its policies, including the authority for Procurement, and to delegate that authority to other University officials. Upon the effective date of these Procurement Rules (Rules), all Procurement authority of the President of the University shall be delegated to the University Assistant Vice President/Chief Procurement Officer. The Assistant Vice President/Chief Procurement Officer may further delegate his/her authority to persons in University departments for the efficient operation of the University. The Assistant Vice President/Chief Procurement Officer is the only person authorized to purchase Goods and Services for the University, unless such specific delegation of authority is made to another employee. Since no rules can cover all eventualities, exceptional cases will be resolved as circumstances and prudent business practices warrant. No employee of the University is empowered to incur any obligation or make any commitment on behalf of the University for the Procurement of Goods or Services, except as provided under these Rules.
Consistent with the provisions of these Rules, the Assistant Vice President/Chief Procurement Officer may adopt operational procedures governing the internal purchasing functions of the University, including purchases at the department level using the University's procurement card and department purchase orders.
Under these Rules, the Purchasing Department is the final authority at the University for the selection of vendors and the sole authority for the commitment of University funds with respect to the Procurement of Goods and Services.
The Assistant Vice President/Chief Procurement Officer may, from time to time, amend these Rules.
These Rules are designed to support and facilitate the educational, research, and public service missions of the University through the acquisitions of Goods and Services by applying best methods and business practices that provide for public confidence in the University.
Within the context of the University environment, these Rules ensure a Procurement process of quality and integrity, broad based competition, fair and equal treatment of the business community, increased economy in the Procurement process, and uniform Procurement procedures.
These Rules apply to all purchases of Goods and Services regardless of funding source.
These Rules do not apply to the following situations:
The University of Colorado Administrative Policy Statement "Conflict of Interest and Commitment Policy" defines the processes to be followed in articulating and resolving conflicts of interest at the University. When the Purchasing Department has reason to believe that a conflict of interest may exist in the Procurement of Goods or Services, it will direct the affected department to comply with the procedures described in this policy.
All parties involved in the negotiation, performance, or administration of University Contracts are bound to act in good faith. Any person employed by the University who purchases Goods and Services, or is involved in the Procurement process for the University, shall be held to the highest degree of trust and shall be bound to the University of Colorado Procurement Code of Ethics included with these Rules as Appendix A.
Vendor shows, which include open houses, product exhibits, or product demonstrations, must be approved in advance by the Assistant Vice President/Chief Procurement Officer in order to:
The sponsoring University department shall notify the Assistant Vice President/Chief Procurement Officer as far in advance as possible but at least ten (10) business days prior to the vendor show. A vendor show is a product demonstration or exhibit to which more than one University department is invited by a vendor for the purposes of marketing Goods or Services. A product or equipment demonstration to a single University department is not a vendor show. The Assistant Vice President/Chief Procurement Officer has the final authority to determine what constitutes a vendor show.
It shall be the policy of the University to purchase Goods and Services in a manner that affords vendors a fair and equal opportunity to compete. Solicitations should only be issued when there is a valid Procurement need. Solicitations should not be issued to obtain estimates or to "test the water."
An electronic Solicitation notification system is the required method for advertising competitive Solicitations for Goods and Services made through Documented Quotes (DQ), Invitation for Bids (IFB), and Request for Proposals (RFP). Other methods of notification may also be used at the discretion of the Purchasing Agent.
Purchasing Agents shall issue Goods or Service Specifications which are not unduly restrictive. Brand Name Specifications, Brand Name or Equal Specifications, or Qualified Products Lists may be used in competitive Solicitations. Furthermore, Brand Name Specifications shall only be used in accordance with Section VI.E.1. on Sole Source Procurements. When appropriate, Specifications issued and/or used by the Federal government, other Public Entities, or professional organizations may be referenced by the University. Vendors may be required to certify that these standardized Specifications have been met.
Solicitation conferences may be conducted to explain Procurement requirements. They shall be announced in the Solicitation. The conference should be held long enough after the Solicitation has been issued to allow vendors to become familiar with it but with adequate time before the Solicitation due date to allow vendors consideration of the conference results in preparing their Quotes/Bids/Proposals. Nothing stated at the conference shall change the Solicitation unless a change is made by written amendment, posted on the electronic Solicitation notification system.
Amendments to Solicitations shall be identified as such and may require that the vendors acknowledge receipt of all amendments issued. Amendments shall be posted on the electronic Solicitation notification system with sufficient time to allow vendors to consider them in preparing their Quotes/Bids/Proposals. If the due date set will not permit such preparation, the due date shall be extended.
Each response shall show the date and time of receipt. Responses to competitive Sealed Solicitations shall be stored in a secure place until due date and time and shall not be opened upon receipt, except that unidentified responses may be opened for identification purposes. Upon verification of a Solicitation response, the response will immediately be resealed and the reason for opening will be noted.
Competitive Sealed Solicitation openings shall be open to the public. Responses shall be opened, in the presence of one or more witnesses, as soon as possible after the time, and at the place, designated in the competitive Solicitation.
Confidential information includes, but is not limited to, trade secrets, privileged information, and confidential commercial and financial information furnished by the vendor and which may be withheld from inspection by the University pursuant to the Colorado Open Records Act, C.R.S. § 24-72-2043(3)(A)(IV). The vendor may submit written requests for confidentiality to the Purchasing Agent pursuant to the Solicitation terms and conditions. Neither a response in its entirety nor price information will be considered confidential information.
Any responses may be withdrawn prior to the specified due date and time upon written request from the offeror.
The Assistant Vice President/Chief Procurement Officer may allow a response to be withdrawn after the specified due date and time but prior to Award, provided:
When it appears from a review of the response that a mistake has been made, the vendor will be asked to confirm the response. Situations in which confirmation should be requested include apparent errors or a price unreasonably lower than other submitted prices. Upon acknowledgment that an error was made, the vendor may have its response considered as-is or may withdraw its response if the conditions set forth in this section are met.
Minor informalities are matters of form rather than substance evident from the response or insignificant mistakes that can be waived or corrected without prejudice to other vendors; that is, the effect on price, quantity, quality, delivery, or contractual conditions is negligible. The Purchasing Agent may waive such informalities or allow the vendor to correct them depending on which is in the best interest of the University.
Any decision to permit or deny correction or withdrawal of a response under this section shall be supported by a written Determination prepared by the Purchasing Agent.
All responses shall be evaluated as outlined in the Solicitation. The Purchasing Agent shall ensure that the Award decision treats all vendors equitably.
Any Solicitation may be cancelled in whole or in part at any point in the process when it is in the best interest of the University as determined by the Assistant Vice President/Chief Procurement Officer. Approval to cancel will be obtained from the Assistant Vice President/Chief Procurement Officer prior to cancellation. The reason(s) for doing so shall be made part of the file and may include the following:
When a Solicitation is cancelled, notice of cancellation shall be posted on the electronic Solicitation notification system.
When Bids or Proposals are rejected, or a Solicitation is cancelled after Bids or Proposals are received, the Bids or Proposals which have been opened shall be retained in the procurement file. Bids and Proposals which have not been opened, shall either be returned to the vendors (upon request), or shall be disposed of.
Procurements shall not be artificially divided so as to constitute small-dollar purchases as defined under this section. All purchases, including small-dollar purchases, are subject to the requirement that prices paid be fair and reasonable (C.R.S. §24-30-202(2)).
The University has developed mechanisms for the purchase of most Goods and Services totaling $5,000 or less.
The University procurement card is the preferred mechanism for purchases totaling $5,000 or less.
University departments may issue department purchase orders for purchases totaling $5,000 or less where the procurement card is not an option.
Purchases of Goods totaling more than $5,000 through $10,000 are processed at the discretion of the Purchasing Agent; for federally funded purchases, competition is required for purchases of Goods totaling more than $5,000 through $10,000.
Purchases of Services totaling more than $5,000 through $25,000 are processed at the discretion of the Purchasing Agent; for federally funded purchases, competition is required for purchases of Services totaling more than $5,000 through $25,000.
Invitation for Bids is a method of Procurement which results in a Contract being Awarded to the lowest Responsive Bid from a Responsible bidder based on the Specifications set forth in the Solicitation. Typical reasons why an IFB may be used include:
The minimum time for the IFB opening date shall be not less than fourteen (14) calendar days after posting Solicitations on the electronic Solicitation notification system. When special requirements or conditions exist, the Assistant Vice President/Chief Procurement Officer may shorten the IFB time but in no case shall the time be shortened in order to reduce competition. Solicitation periods of less than fourteen (14) calendar days shall be documented as to why a reduced IFB period was required.
IFBs must be advertised in accordance with Section VI.A.3.
Responses received after the due date and time shall not be opened and shall be rejected as late.
The name of each bidder, the Bid price(s) (unless otherwise provided in the Invitation for Bids), and other information deemed appropriate by the Purchasing Agent shall be read aloud at the time of the IFB opening. Reading of all Bid item prices may not be reasonable or desired (e.g., in the case of lengthy or complex IFBs). The decision not to read all Bid prices shall be made by the Purchasing Agent. The name of each bidder, amount of Bid, delivery, name(s) of witness(es) and other relevant information shall be entered into the record and the record shall be available for public inspection. Prior to Award, copies of pricing information not read aloud at the IFB opening shall be made reasonably available for inspection, if requested. Other information related to a Bid, or a bidder's Responsiveness, may be withheld from inspection until questions concerning such information are resolved. After Award, all IFB/Bid documents, and a complete Bid analysis, shall be open to public inspection except to the extent the University has approved a bidder's request that information be held confidential as set forth in Section VI.A.7.c.
All Goods and Services shall be evaluated for Acceptability against the Specifications and/or brand names used as a reference and other evaluation criteria as set forth in the IFB. Following determination of Acceptability, Bids shall be evaluated to determine which bidder offers the lowest costs to the University in accordance with the Specifications, taking into account any life-cycle cost formulas stated in the IFB.
A multi-step Sealed IFB is a two-phase process. The technical first phase is composed of one or more steps in which bidders submit unpriced technical offers to be evaluated by the University. The second phase considers only those bidders whose technical offers were determined to be Acceptable during the first phase. At this time, their price Bids will be opened and considered. The process is designed to obtain the benefits of competitive Sealed bidding by Award of a Contract to the lowest Responsive, Responsible bidder, and at the same time obtain the benefits of the Request for Proposals procedure through the Solicitation of technical offers and the conduct of discussions to evaluate and determine the Acceptability of technical offers.
A Best Value IFB is used where the IFB specifically allows for Enhancements, Options, and/or Alternatives. A Best Value IFB must include a Base Bid statement.
The Purchasing Agent shall provide a written Determination for approval to the Assistant Vice President/Chief Procurement Officer prior to the use of a Best Value IFB. The written Determination must explain why the Best Value IFB is appropriate for the Good or Service being solicited.
The criteria or formula for evaluation must include objective consideration of the costs and savings and/or benefits associated with the Enhancements, Options, or Alternatives. Based on the evaluation of the cost of the Base Bid, the dollar value of Enhancements, Options, or Alternatives, and the Determination of which best meet the needs of the University, an Award shall be made to the bidder providing the Best Value to the University.
Contracts for Goods and Services may be Awarded by Competitive Reverse Auctions if the Purchasing Agent determines that Adequate Competition can be achieved.
Request for Proposals (RFP) will be used for the Solicitation of competitive Sealed Proposals over $500,000 which are evaluated on the basis of factors that include but are not limited to price. Evaluations shall be based on the factors set forth in the RFP in order to determine which Proposal(s) best meet(s) the needs of the University.
The Purchasing Agent must provide a written Determination for approval to the Assistant Vice President/Chief Procurement Officer prior to the use of an RFP. The written Determination must explain why the RFP is the proper method of Solicitation.
A committee of no less than three individuals shall evaluate all Responsive Proposals.
RFPs will be open for a minimum of thirty (30) calendar days unless a shortened time frame is approved in writing by the Assistant Vice President/Chief Procurement Officer.
RFPs will be advertised in accordance with Section VI.A.3.
Responses received after the due date and time shall not be opened and shall be rejected as late.
There shall be a public opening at the date and time specified in the RFP. The Purchasing Agent shall read the name of all proposers submitting responses. A witness shall be present. All information other than the proposers' names remains confidential until posting of the notice of intent to Award.
Contracts may be awarded by Competitive Negotiation
Procurement without competition is authorized under limited conditions and subject to written justification documenting the conditions which preclude the use of a competitive process. A Sole Source Procurement is justified when there is only one Good or Service that can reasonably meet the need and there is only one vendor who can provide the Good or Service. A requirement for a particular proprietary item (i.e., a Brand Name Specification) does not justify a Sole Source Procurement if there is more than one potential vendor for that Good or Service. Price is not a consideration to justify a Sole Source Procurement. In cases of reasonable doubt, competition will be solicited.
The Purchasing Department shall take reasonable steps to avoid using Sole Source Procurement except in circumstances where it is both necessary and in the best interests of the University. The Purchasing Department shall take action, whenever possible, to avoid the need to continue to procure the same Goods and/or Services without competition.
When an emergency condition exists that prevents the use of a competitive Procurement method, the University may conduct a Procurement on an emergency basis. Emergency Procurements may be negotiated on a Sole Source or limited competition basis as dictated by the circumstances surrounding the emergency.
An emergency condition justifies the use of an emergency Procurement when that condition threatens one (1) or more of the following:
Emergency Procurements do not include:
The University may make emergency Procurements when an emergency condition arises and the need cannot be met through normal Procurement methods, provided that whenever Practicable, approval by the Assistant Vice President/Chief Procurement Officer shall be obtained prior to the Procurement. In the event an emergency arises after normal working hours, the University department shall notify the Assistant Vice President/Chief Procurement Officer on the next working day. If the Assistant Vice President/Chief Procurement Officer determines that all criteria for an emergency Procurement were not met, then the Procurement will be processed as an "After-the-Fact" Procurement as set forth in Section VIII.
The emergency Procurement shall be limited to the Procurement of only the types of items and quantities or time period sufficient to meet the immediate threat and shall not be used to meet long-term requirements.
As soon as Practicable, the University department shall prepare a written justification, to be approved by the Assistant Vice President/Chief Procurement Officer, that sets forth the justification for the emergency Procurement. The justification shall include the following:
Equipment requested by University departments from vendors, or offered by vendors to University departments, on a trial, loan, demonstration, or evaluation basis does not constitute a commitment to purchase said equipment. The University department shall be responsible for advising the vendor that, for purchases totaling over $5,000, a purchase order will be issued at the discretion of the Purchasing Agent, and that competitive purchasing procedures shall be used as required by University policies and procedures. If the vendor who loaned the equipment is the successful vendor, new equipment must be supplied unless otherwise specified.
All moving, handling, transportation, and applicable installation costs associated with the equipment of this nature are the sole responsibility of the vendor unless otherwise specified. The University will not incur any costs associated with equipment that is on trial, loaned, demonstrated, tested, or evaluated unless otherwise specified.
Any agreement which is required by the vendor shall be signed by the appropriate Purchasing Agent, regardless of the dollar value of the equipment.
Subject to the limitations of this section, any type of Contract which will promote the best interests of the University may be used; except that the use of a cost-plus-a-percentage-of-cost Contract is prohibited. A Cost-Reimbursement Contract may be used only when a written Determination is made that such Contract is likely to be less costly to the University than any other type of Contract or that it is impracticable to obtain the Goods or Services required unless the Cost Reimbursement Contract is used. The minimum requirements for Contract formation and content are contained in Chapters 2 and 3 of the State of Colorado Fiscal Rules.
The Purchasing Department may enter into multi-year Contracts for Goods or Services subject to funding availability. Contracts for periods in excess of five years require the written approval of the Assistant Vice President/Chief Procurement Officer.
All After-the-Fact purchases must be processed in accordance with the University of Colorado Fiscal Procedures 2-2, 5. After-The-Fact Purchases.
The Assistant Vice President/Chief Procurement Officer is authorized to settle and resolve any questions regarding:
All costs associated with filing and prosecuting a protest or Contract dispute shall be borne by the Protestor/Contractor.
Protestors may file a protest on any phase of a Solicitation or Award including, but not limited to, Specifications, Award, or disclosure of information marked confidential in a Solicitation offer. Protests shall be submitted in writing within seven (7) working days after such aggrieved person knows or should have known of the facts giving rise thereto.
The written protest shall include, at a minimum:
The protest shall be addressed to the Assistant Vice President/Chief Procurement Officer and sent to the Purchasing Department in the Procurement Service Center.
Any additional information regarding the protest should be submitted within the time period requested in order to expedite resolution of the protest. If any party fails to comply expeditiously with any request for information by the Assistant Vice President/Chief Procurement Officer, the protest may be resolved without such information.
The Assistant Vice President/Chief Procurement Officer shall render a written decision regarding the protest within seven (7) working days after the protest is received. The decision shall be based on and limited to a review of the issues raised by the Protestor and shall set forth each factor taken into account in reaching the decision. The Assistant Vice President/Chief Procurement Officer shall furnish a copy of the decision to the Protestor in writing.
In the case of protested RFPs only, there shall be a stay of Procurement until the decision of the Assistant Vice President/Chief Procurement Officer is rendered, unless the Assistant Vice President/Chief Procurement Officer determines that execution of a Contract without delay is necessary to protect substantial University interests.
If a Protestor has filed a complaint in court which complaint is also the subject of a protest filed with the Assistant Vice President/Chief Procurement Officer, the Assistant Vice President/Chief Procurement Officer will not review the protest.
When a protest is sustained by the Assistant Vice President/Chief Procurement Officer and the Protestor should have been Awarded the Contract under the Solicitation but, due to a defect in the Solicitation, was not, the Protestor shall be entitled to the reasonable costs incurred in connection with responding to the Solicitation. No other costs shall be permitted, and reasonable costs shall not include attorney fees.
The terms and conditions of University Contracts establish procedures and remedies to resolve Contract and breach of Contract controversies between the University and a Contractor. It is the University's policy to try to resolve all controversies by mutual agreement through informal discussions without litigation. As used in these Rules, the word "controversy" is meant to be broad and all-encompassing, including the full spectrum of disagreements from pricing of routine Contract changes to claims of breach of Contract.
When a controversy cannot be resolved by mutual agreement, the Assistant Vice President/Chief Procurement Officer shall review the matter within twenty (20) working days after receiving a written request by the Contractor for a final decision and shall issue a written decision.
The Assistant Vice President/Chief Procurement Officer shall furnish a written copy of the decision to the Contractor. The decision shall include:
If a Contractor has filed a complaint in court which complaint is also the subject of a protest filed with the Assistant Vice President/Chief Procurement Officer, the Assistant Vice President/Chief Procurement Officer will not review the protest.
This section of the Rules contains cost principles and procedures to be used as guidance in:
Cost principles in this section of the Rules are not applicable to:
Any Contract cost proposed for estimating purposes or invoiced for cost-reimbursement purposes are permitted as provided in the Contract. The Contract shall provide that the total permitted cost of a Contract is the sum of the permitted direct costs actually incurred (or, in the case of forward pricing, the amount estimated to be incurred) in the performance of the Contract in accordance with its terms, plus the properly allocable portion of the allowable indirect costs, less any applicable credits (such as discounts, rebates, refunds, and property disposal income).
All costs shall be accounted for in accordance with generally accepted accounting principles and in a manner that is consistent with the Contractor's usual accounting practices in charging costs to other activities. In pricing a proposal, a Contractor shall estimate costs consistently with cost accounting practices used in accumulating and reporting costs.
The Contract shall provide that costs are permitted to the extent they are:
Any cost is reasonable if, in its nature or amount, it does not exceed that which would be incurred by an ordinarily prudent person in the conduct of competitive business. In determining the reasonableness of a given cost, consideration shall be given to:
A cost is allocable if it is assignable or chargeable to one or more cost objectives in accordance with relative benefits received and if it:
Costs are allocable as direct or indirect costs. Similar costs (those incurred for the same purpose, in like circumstances) shall be treated consistently either as direct costs or indirect costs except as set forth herein. When a cost is treated as a direct cost in respect to one cost objective, it and all similar costs shall be treated as a direct cost for all cost objectives. Further, all costs similar to those included in any indirect pool shall be treated as indirect costs. All distributions to cost objectives from a cost pool shall be on the same basis.
A direct cost is any cost which can be identified specifically with a particular cost objective. A direct cost shall be allocated only to its specific cost objective. To be allowable, a direct cost must be incurred in accordance with the terms of the Contract.
An indirect cost is one identified with more than one cost objective. Indirect costs are those remaining to be allocated to the several cost objectives after direct costs have been determined and charged directly to the Contract or other work as appropriate. Any direct costs of minor dollar amounts may be treated as indirect costs, provided that such treatment produces substantially the same results as treating the cost as a direct cost.
Indirect costs shall be accumulated into logical cost groups with consideration of the reasons for incurring the costs. Each group should be distributed to cost objectives benefiting from the costs in the group. Each indirect cost group shall be distributed to the cost objectives substantially in proportion to the benefits received by the cost objectives. The number and composition of the groups and the method of distribution should not unduly complicate indirect cost allocation where substantially the same result could be achieved through less precise methods.
The Contractor's method of distribution may require examination when:
The base period for indirect cost allocation is the one in which such costs are incurred and accumulated for distribution to work performed in that period. Normally, the base period is the Contractor's fiscal year. A different base period may be appropriate under unusual circumstances. In such cases, an appropriate period should be agreed to in advance.
The only permitted advertising costs are those for:
Bad debts include losses arising from uncollectible accounts and other claims, such as dishonored checks, employee advances, and related collection and legal costs. All bad debt costs are prohibited.
Contingency costs are contributions to a reserve account for unforeseen costs. Such contingency costs are unallowable except as provided in Section X.E.3.b.
For the purpose of establishing a Contract cost estimate or price in advance of performance of the Contract, recognition of uncertainties within a reasonably anticipated range of costs may be required and is not prohibited by this subsection. However, where Contract clauses are present which serve to remove risks from the Contractor, there shall not be included in the Contract price a contingency factor for such risks. Further, contributions to a reserve for self-insurance in lieu of, and not in excess of, commercially available liability insurance premiums, are allowable as an indirect charge.
Depreciation and use allowances are permitted to compensate Contractors for the use of buildings, capital improvements and equipment. Depreciation is a method of allocating the acquisition cost of an asset to periods of its useful life. Useful life refers to the asset's period of economic usefulness in the particular Contractor's operation as distinguished from its physical life. Use allowances provide compensation in lieu of depreciation or other equivalent costs. Consequently, these two methods may not be combined to compensate Contractors for the use of any one type of property.
The computation of depreciation or use allowances shall be based on acquisition costs. When the acquisition costs are unknown, reasonable estimates may be used.
Depreciation shall be computed using any generally accepted method, provided that the method is consistently applied and results in equitable charges considering the use of the property. The straight-line method of depreciation is preferred unless the circumstances warrant some other method. However, the University will accept any method which is accepted by the Internal Revenue Service.
In order to compensate the Contractor for use of depreciated, Contractor-owned property which has been fully depreciated on the Contractor's books and records and is being used in the performance of a Contract, use allowances are permitted, provided that they are computed in accordance with an established industry or government schedule or other method mutually agreed upon by the parties. If a schedule is not used, factors to consider in establishing through-allowance are the original cost, remaining estimated useful life, the reasonable fair market value, the effect of any increased maintenance or decreased efficiency.
Entertainment costs include costs of amusements, social activities and incidental costs relating thereto, such as meals, beverages, lodging, transportation and gratuities. Entertainment costs are unallowable.
Nothing herein shall prohibit a legitimate expense for employee morale, health, welfare, food service, or lodging cost; except that, where a net profit is generated by such employer related services, it shall be treated as a credit as provided in Section X.G (Applicable Credits). This section shall not prohibit costs incurred for meetings or conferences, including, but not limited to, costs of food, rental facilities, and transportation where the primary purpose of incurring such cost is the dissemination of technical information or the stimulation of production.
Fines and penalties include all costs incurred as the result of violations of or failure to comply with Federal, state and local laws and regulations. Fines and penalties are prohibited costs unless incurred as a direct result of compliance with specific provisions of the Contract or written instructions of the University's authorized representative. To the extent that workers' compensation is considered by state law to constitute a fine or penalty, it shall not be an allowable cost under this subsection.
A gift is property transferred to another person without the other person providing return consideration of equivalent value. Reasonable costs for employee morale, health, welfare, food services, or lodging are not gifts and are permitted. Contributions and donations are property transferred to a nonprofit institution which are transferred in exchange for supplies or services of equivalent fair market value rendered by a nonprofit institution. Gifts, contributions and donations are prohibited.
Interest is a cost of borrowing. Interest is not permitted except as provided in Section X.E.8.b. Interest costs on Contractor claims for payments due under University Contracts are permitted.
A loss is the excess of costs over income earned under a particular contract. Losses may include both direct and indirect costs. A loss incurred under one contract may not be charged to any other contract.
Material costs are the costs of all supplies, including raw material, parts and components (whether acquired by purchase from an outside source or acquired by transfer from any division, subsidiary, or affiliate under the common control of the Contractor), which are acquired in order to perform the Contract. Material costs are permitted, subject to Section X.E.10.b and Section X.E.10.c. In determining material costs, consideration shall be given to reasonable spoilage, reasonable inventory losses and reasonable overages.
Material costs shall include adjustments for all available discounts, refunds, rebates and allowances which the Contractor reasonably should take under the circumstances, and for credits for proceeds the Contractor received or reasonably should receive from salvage and material returned to suppliers.
Allowance for all materials transferred from any division (including the division performing the Contract), subsidiary, or affiliate under the common control of the Contractor shall be made on the basis of costs incurred by the transferrer (determined in accordance with these cost principle regulations, except that double charging of indirect costs is unallowable), except the transfer may be made at the established price provided that the price of materials is not determined to be unreasonable by the University's Purchasing Agent and the price is not higher than the transferrer's current sales price to its most favored customer for a like quantity under similar payment and delivery conditions and:
Except as limited in Section X.E.11.b, all taxes which the Contractor is required to pay and which are paid and accrued in accordance with generally accepted accounting principles are permitted.
The following costs are not permitted:
Any refund of taxes which were permitted as a direct cost under the Contract shall be credited to the Contract. Any refund of taxes which were permitted as an indirect cost under the Contract shall be credited to the indirect cost group applicable to contracts being priced or costs being reimbursed during the period in which the refund is made.
Direct government charges for services such as water, or capital improvements such as sidewalks, are not considered taxes and are permitted costs.
The costs described in Sections X.F.2, 3, 4, and 5 are permitted as direct costs to cost-reimbursement type Contracts to the extent that they have been approved in advance by the University's Purchasing Agent. In other situations those costs are negotiable in accordance with general standards set out herein.
Pre-Contract costs are those incurred prior to the effective date of the Contract directly pursuant to, and in anticipation of, the Award of the Contract. Such costs are permitted to the extent that they would have been permitted if incurred after the beginning date of the Contract; provided that, in the case of a cost-reimbursement type Contract, a special provision must be inserted in the Contract setting forth the period of time and maximum amount of cost which will be covered as permitted pre-Contract costs.
Bid and proposal costs are the costs incurred in preparing, submitting and supporting bids and proposals. Reasonable ordinary bid and proposal costs are permitted as direct costs only to the extent that they are specifically permitted by a provision of the Contract or Solicitation document. Where bid and proposal costs are permitted as direct costs, to avoid double accounting, the same bid and proposal costs shall not be charged as indirect costs.
Insurance costs are the costs of obtaining insurance in connection with performance of the Contract or contributions to a reserve account for the purpose of self-insurance. Ordinary and necessary insurance costs are permitted in accordance with these cost principles. Self-insurance contributions are permitted only to the extent of the cost to the Contractor to obtain similar insurance.
Insurance costs may be approved as a direct cost only if the insurance is specifically required for the performance of the Contract.
Actual losses which should reasonably have been covered by permissible insurance or were expressly covered by self-insurance are prohibited unless the parties expressly agree otherwise in the terms of the Contract.
Litigation costs include all filing fees, legal fees, expert witness fees, and all other costs involved in litigating claims in court or before an administrative agency. Costs incurred in litigation against the University are not permitted.
Applicable credits are receipts or price reductions which offset or reduce expenditures allocable to Contracts as direct or indirect costs. Examples include purchase discounts, rebates, allowances, recoveries or indemnification for losses, sale of scraps and surplus equipment and materials, adjustments for overpayments or erroneous charges, and income from employee recreational, incidental, or services and food sales.
Credits shall be applied to reduce related direct or indirect costs.
The University shall be entitled to a cash refund if the related expenditures have been paid to the Contractor under a cost-reimbursement type Contract.
Both the University and the Contractor should seek to avoid disputes and litigation arising from potential problems by providing in the terms of the Contract the treatment to be accorded special or unusual costs.
In dealing with Contractors operating according to Federal cost principles, such as Defense Acquisition Regulation, Section 15, or Federal Acquisition Regulations (FAR), Part 1-15, the University's Purchasing Agent, after notifying the Contractor, may use the Federal cost principles as guidance in Contract negotiations, subject to Section X.I.2.
In Contracts not Awarded under a program which is funded by Federal assistance funds, the University may explicitly incorporate Federal cost principles into a Solicitation and thus into any Contract Awarded pursuant to that Solicitation. The University Purchasing Agent and the Contractor may by mutual agreement incorporate Federal cost principles into a Contract during negotiation or after Award. In either instance, the language incorporating the Federal cost principles shall clearly state that to the extent Federal cost principles conflict with these Rules, these Rules shall control.
In Contracts Awarded under a program which is financed in whole or in part by Federal assistance funds, all requirements set forth in the assistance document including specified Federal cost principles, must be satisfied. Therefore, to the extent that the cost principles specified in the grant document conflict with the cost principles in these Rules, the cost principles specified in the grant shall control.
If the University's Purchasing Agent desires to deviate from the cost principles set forth in these Rules, a Determination shall be made by such Purchasing Agent specifying the reasons for the deviation.
After meeting with the affected University department(s) and, where Practicable, the vendor who is to be suspended, the Assistant Vice President/Chief Procurement Officer may issue a written Determination to suspend a vendor from doing business with the University pending an investigation to determine whether cause exists for debarment. The suspension shall not exceed three (3) months unless a criminal indictment has been issued for an offense which would be cause for debarment. In such cases, the suspension may remain in effect until after the trial of the suspended vendor.
A written notice of the suspension, including a copy of the Determination, shall be sent to the suspended vendor. The notice shall:
The suspension period will be effective upon issuance of the notice of suspension.
A vendor may be debarred for any of the following reasons:
Following completion of the investigation to determine whether a vendor has engaged in activities which are cause for debarment, the Assistant Vice President/Chief Procurement Officer may debar the vendor. A vendor may be debarred for a period of time commensurate with the seriousness of the offense.
A written notice of debarment shall be sent to the suspended vendor. The notice shall:
The debarment period will be effective fourteen (14) days after the notice of debarment is sent to the debarred vendor.
After the debarment period begins, the vendor shall remain debarred until the debarment period specified expires unless a court or the Assistant Vice President/Chief Procurement Officer orders otherwise.
The Purchasing Department shall maintain a master list of all suspensions and debarments. The master list will contain information concerning suspensions and debarments as public records.
Successful Businesses have a positive impact on the University community and it is important that the University promote a strong diverse Business community. Therefore, the University has established a Small Business Program whose mission is to maximize the opportunities for small Business concerns, including small disadvantaged Businesses, woman-owned Businesses, HUBZone Businesses, historically black colleges/universities and minority institutions, veteran-owned and service-disabled veteran-owned Businesses, to participate in the University's business of procuring Goods and Services at all dollar levels. Other than in Tie Quotes/Bids situations as described in Section VI.A.7.e.(ii)(a), no provision is made in these Rules for preferences or set asides for small or disadvantaged businesses.
Procurement records are subject to disclosure pursuant to the provisions of the Colorado Open Records Act, C.R.S. §§ 24-72-101 et seq.
Procurement records shall be retained and disposed of in accordance with applicable records retention policies.