OFFICE OF THE GENERAL COUNSEL CONTRACT COMPLIANCE TRAINING

OFFICE OF THE GENERAL COUNSEL CONTRACT COMPLIANCE TRAINING

OFFICE OF THE GENERAL COUNSEL Department Personnel Mario K. Castillo Chief Operating Officer & General Counsel John R. Guest Deputy General Counsel Amy M. Benya Senior Assistant General Counsel

CONTRACT INTERPRETATION All questions regarding proper contract use or interpretation of contract terms and conditions must be directed to OGC.

TIME FRAMES FOR PROCESSING • Generally, all contracts should be submitted for processing to our office by a minimum of 30 calendar days prior to the effective date/start date of the contract. • Our goal is a turnaround not to exceed ten business days. • You can track the progress of your request in Service. Now.

LEGAL OPINIONS VS. CONTRACT COMPLIANCE • A request for a legal opinion must be made through Service. Now and be certified by your Vice Chancellor or college President. – Examples: Questions on College policy interpretations, laws, facility use, etc. • Questions regarding contract compliance may be directed to OGC. – Examples: When is a contract needed, which contract should be used, whether an amendment is needed, etc.

CONTRACT COMPLIANCE ON OGC’S WEBSITE http: //www. lonestar. edu/contract-compliance. htm

WHEN IS A CONTRACT REQUIRED? Goods vs. Services • Any time the College is receiving a service, a contract is required to govern that service. • Under most circumstances, if the College is purchasing goods only, a contract may not be required and a Purchase Order will be issued by the Purchasing Dept. Contact Purchasing for direction in this regard. • Under most circumstances, if the College is obtaining goods and services, a contract is required.

PROPER PROCUREMENT PROCEDURES • A Contract cannot be executed until proper procurement procedures have been performed and approved. • Work cannot begin prior to a contract being fully executed. • Invoices must not be back-dated to avoid personal & institutional liability issues.

TWO TYPES OF CONTRACTS The type of contract will determine how it will be processed and whether or not it requires legal review. • Standard Contracts: − Are agreements that have been created and pre-approved by OGC. − Can be obtained from our website: http: //www. lonestar. edu/11792. htm • Non-Standard Contracts: − Are provided by the Vendor, Contractor, or Other Party. − Require OGC review and approval.

OFFICE OF THE GENERAL COUNSEL PROCESS FOR STANDARD CONTRACTS

COMPLETING THE CONTRACT FORM • On the contract itself, please make sure all of the form fields are properly filled in. – This includes the Notice provisions, if included in the contract. • Read the Contract carefully and thoroughly. • Make sure it meets your business needs.

ACCURATELY DESCRIBING THE SERVICES • Statement of Services: – Vendor should provide a clear description of services to be rendered in the contract. • For example, the Statement of Services for a copier delivery should state: – The date and time of delivery – The building and room number that the copier will be delivered to – Any other key details, such as that the vendor will perform set-up or installation

PROCESSING THE STANDARD CONTRACT • Send two copies of the unsigned contract to the other party (unless a greater number is requested) and request signatures. • When both executed contracts are returned, if no changes have been made to the standard contract, have the proper signatory sign for the College. • Once all signatures are in place, forward one original to the other party, and keep the second original for your file. ! Note: If changes were made by the other party, you must send the contracts to our office for review. After our review, we will return the approved-as-modified contract to the originator to obtain proper signatures & continue with the above process.

BOARD CONTRACTS • A contract for an expense of $100, 000 or more must go to the Board for approval and the Chancellor’s signature. • Any purchase for more than $50, 000 requires an RFP. • The Purchasing department will forward the contract to our office for review, and if needed, to create the agreement. • Once our review is complete, we forward to Purchasing to obtain vendors signatures. • Once Purchasing has obtained signatures, they will forward the agreements back to our office for OGC approval.

OFFICE OF THE GENERAL COUNSEL PROCESS FOR NON-STANDARD CONTRACTS

THE DUTIES OF EACH DEPARTMENT • Carefully read and understand the obligations of the Contract. • OGC does not determine whether contracts are “good” business decisions; we only review contracts for compliance with the law and College policy. • The College signatory is accountable for the business terms. • Please let our office know if you have concerns about any terms in the Contract.

REQUIRED DOCUMENTS Documents to be submitted via Service. Now for a Non-Standard Contract: • The Contract itself − Submit a copy in Word format if you have one • All Exhibits and/or Attachments • Any additional supporting documentation

LEGAL REVIEW REQUIRED BEFORE EXECUTION • A non-standard contract should never be fully executed (with signatures in place) before it comes to OGC for review. • Asking OGC to review a fully executed agreement defeats the purpose of requiring legal review because the College has already committed to the terms.

WHAT TO LOOK FOR IN NON-STANDARD CONTRACTS • Payment Provisions should be specific. – For example, “This contract is not to exceed $10, 000. Payment will be made according to detailed and specific invoices submitted by Contractor. LSC will make payments within 45 days of receipt of such invoices. ” • Statement of Services: – Describes the goods and/or services the College is purchasing or providing. – Should be as detailed as possible. – Do not assume that the Vendor, Contractor, or the Other Party knows what is expected of them.

THE REVIEW PROCESS 1. Review the contract and any attachments for compliance. 2. Submit contract and comments to OGC via Service. Now. 3. OGC will review and approve the contract. 4. Once approved, we will route to the originator to forward to the proper College signatory for signature. 5. The originator will forward to the vendor for signature.

PROPER SIGNATURE AUTHORITY • Only certain designated individuals may bind the College: – The Chancellor has authority up to $100, 000. – The Vice Chancellors and Presidents have authority up to $50, 000. – Questions regarding the Delegation of Authority may be directed to OGC. • If you sign a contract without obtaining proper signature authority, you may be personally liable.

FINAL REVIEW AND RECORD KEEPING Upon receipt of the Fully Executed Contract: • We will make sure signatories have proper authority and that contracts are signed by both parties. • Our office will retain an electronic copy. • The Vendor, Contractor, or Other Party will retain one original. • The Requesting Department will retain the second original.

AMENDMENTS AND MODIFICATIONS • Once a contact has been fully executed by both parties, the only way to change the terms in the contract is by an amendment. • An amendment must be in writing and signed by both parties. • The amendment must be fully executed BEFORE the original contract expires. • If the total amount of the contract after the amendment exceeds $100, 000 or exceeds the prior Board approved amount, it must go to the Board for approval.

REQUESTING MODIFICATIONS OR AMENDMENTS • If your initial request is still open in Service. Now, you can request changes by adding customer comments. • If the contract has been executed and the matter is closed, you must submit a new request in Service. Now. – Include a detailed description of what needs to be modified, or attach a copy of the Amendment (as a Word document, if possible). – Attach a copy of the Original Agreement and, if applicable, any previous amendments. – Attach any additional supporting documentation.

GRANTS • A Grant Subcontract, or sub-grant, typically results from a grant proposal, SOW, MOU or Local Contract from another agency which has specifically identified the participation of the College. A Subcontract is sent after the granting institution has received their grant award funding. If the Contract is bound by terms of a grant award, then it is still considered a Grant Subcontract. • The Subcontract needs to be submitted to the Resource Development & Administration Office (RDA) for review.

OFFICE OF THE GENERAL COUNSEL QUESTIONS MAY BE SUBMITTED THROUGH SERVICE NOW HTTPS: //LONESTAR. SERVICE-NOW. COM/