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Human Resources

College Policies I Purchasing Policy

Procurement Policy


The following guidelines have been established to assure fairness, efficiency, and effectiveness of procurement activities associated with the operations of Washington College.

Washington College procurements should be conducted in support of the mission and goals of the college in a manner that assures that goods and services provide the best value for the expenditure of college resources.

Socio-Economic Statement

Washington College reaffirms its support for disadvantaged businesses whose socio-economic

characteristics may require such support and include minority and women owned businesses, small businesses and environmentally conscious firms. Organizations with such characteristics are encouraged to contact the Business Office for and introduction to Washington College’s procurement structure and obtain pertinent materials.


Washington College has decentralized procurement system in which the College’s Business Office assists all authorized budget managers in overseeing purchases for the college. Certain procurements, however, are the responsibility of specific college units; (e.g. construction, Building and Grounds, College Relations). For other procurements, each senior staff member is responsible for the procurement process but may delegate one or more employees (the Dept Budget Managers) day to day responsibility for assuring that all goods and services are provided, in working and/or acceptable manner, at a purchase price that is competitive in the open market and that meets standard technical specifications generally accepted in the applicable field.

Purchase Orders

Generally purchase of all capital goods and services and non-capital goods and services of

$5,000 or more require an official purchase order prior to making any commitment to a vendor. Purchase orders give the vendor official notification that the college has committed financial resources towards the purchase and may be required by the vendor. Internally, purchase orders allow the college to assure the proper procurement policies have been satisfied, the necessary approvals have been obtained and sufficient operating funds exist prior to making a commitment to a vendor.

In addition to purchase orders less than $5,000, purchase orders are not required for travel and entertainment expenses over $5,000 that cannot be pre-paid and are incurred off campus.


The competitive procurement of goods and services is the preferred method of procurement. There are, however, instances in which competitive procurement may not be required.

Emergency Procurements

To ensure the operations of the essential services during non-business hours, authorized budget managers may proceed with necessary expenditures to maintain or restore essential services to the college without seeking a purchase order prior to a commitment to a vendor. The Budget

Manager should make all reasonable attempts to obtain a purchase price that is competitive in the open market and that meets standard technical specifications generally acceptable in the applicable field. At the next reasonable opportunity, the Budget Manger should submit the standard paperwork for approval explaining the emergency and related essential services that precluded the use of the normal purchasing procedures.

Sole Source Procurements

Purchases of $5,000 or more may be made, without a competitive process, with the prior written approval or appropriate senior staff, when there is a single viable source of the good or services ( e.g. Town of Chestertown water, a guest lecturer), compatibility with existing equipment or processes, or similar circumstances. Written documentation should be maintained in the unit’s procurement files providing the justification for the sole source selection.

Procurements using Federal Funds

Purchases made using federal grant funds must be vetted by the PI through to determine if a vendor has been suspended or debarred.  Any vendor suspended or debarred may not be used under any circumstances.

Competitive Procurements

Purchases less than $5,000

The purchase of goods and/or services (other than capital goods) from a single vendor for a single project or event which, cumulatively, amount to less than $5,000 do not require comparative quotes from multiple vendors and do not require a purchase order unless the vendor requires it. Securing a price comparison, however, is strongly encouraged when beneficial to the college.

The authorized Budget Manager can approve such purchases to the extent they are routine and they can be funded by the department’s remaining operating budget.

It is strongly urged that the credit card be used for these purchases (other than services) whenever possible.

Purchases in excess of $5,000 but less than $25,000

The purchase of goods and/or services (other than capital goods) from a single vendor for a single project or event which, cumulatively, amount to $5,000 or more but less than $25,000 generally requires obtaining comparative quotes or pricing, written or verbal, from at least two vendors, if multiple sources of pricing are available. If pricing from more than two vendors is readily available, additional comparisons should be sought, if reasonable.

Purchases of $25,000 or more

The purchase of goods and/or services (other than capital) from a single vendor or for a single project or event which, cumulatively, amount to $25,000 require an official request for proposal/bid process prior to making a commitment to a vendor. As in the case of purchases under $25,000, if pricing from two vendors is not feasible or if goods or services is only available from a single source because it is unique, product/service compatibility with existing equipment or processes, or similar circumstance, the procurement file should include a written statement why competitive quotes were not solicited.

If using the WC Corporate Visa card, the normal request for proposal/bid process must be followed;

Capital Purchases

Purchases of capital goods and services follow the same guidelines as non capital goods; however, a Washington College requisition must be properly completed and authorized before the purchase is made.

Employees should be specifically familiar with the OIT Technology Purchasing Policy prior to making any technology or technology related purchases, capital or non-capital.

Procurement Approvals

The college requires each purchase be approved by the appropriate authority level. This policy applies to all employees who initiate or approve a purchase for the college.

Purchases less the $5,000- Non Capital Goods- Departmental Budget Manager

Purchases of $5,000 or more- Non Capital Goods- Budget Director and appropriate Senior Staff Purchases of Capital Goods- Departmental Budget Managers, Budget Director and Vice President for Finance & Administration.

Information Privacy

As a privately operated institution, Washington College is not required to publish publicly or

announce any vendor pricing or information, or the results of a competitive bidding process. Employees are asked to keep all specific information relative to College procurement activities confidential.


Discounts to the college are to be utilized whenever available and should be considered in the final pricing of a vendor. All college employees should inquire about discounts even if such discounts are not advertised.

Tax Exempt Organization

Washington College is a tax exempt organization in the State of Maryland. Employees will not

be reimbursed for business related sales tax expense incurred within the State of Maryland. A copy of the College’s State of Maryland tax exempt certificate, is available from the Business Office and at

Log in to secure downloads.  Any other state tax exemption certificates will also be located here.

Unauthorized Procurements

Employees who make unauthorized commitments to vendors may be subject to disciplinary

actions including but not limited to reimbursement to the college, demotion, suspension and/or termination.

Conflict of Interest

Employees must avoid actual or apparent conflicts of interest, defined as using their position at

the college for personal or financial gain, accepting employment or payment from a customer or vendor, accepting gifts other than those of nominal value, and/or requesting personal favors, discounts, or services.

Donations or Gifts

As a non-profit organization Washington College does not give donations or gifts to other

organizations or individuals. The College may provide financial resources to organizations that provide services to the college on a voluntary basis (e.g. Kent County Fire and Rescue Squad, Chestertown Volunteer Fire Department), if deemed vital to the operation of the college and approved by the President.  Additionally, clubs of the College may designate donations on behalf of their fund raising efforts to support other non-profit organizations.

Improper Procurement Activities

Employees who believe that a college vendor or a vendor’s employee has acted in an unethical manner should report such activity to the Vice President for Finance and Administration or the Chief of Staff.

Individuals, including vendors and college employees, who view the procurement activities of any college employee to be unethical or contrary to college policies, should report such activities to the Vice President for Finance and Administration or the  Chief of Staff

College employees who have been ask by a supervisor or fellow employee to conduct procurement activities deemed unethical or contrary to college policies should report such activities to the Vice President of Finance and Administration or the Chief of Staff.

No employee should experience any retaliation by his or her supervisor or by any other employee at the college for contributing information about improper procurement activities.

Payment Distribution

Checks will generally be mailed via campus mail on the Friday following the week your request is received. However, due to the volume of requests, this one-week turnaround is not automatically guaranteed.  Please allow the Business Office staff as much lead time as possible.

If you have an immediate request that is time critical, please contact the Accounts Payable office personnel directly regarding the request.

All checks to outside vendors are mailed directly from the Business Office, unless there is a genuine need for special handling. This is done to facilitate tracking payments and responding to vendor inquiries.  Reimbursement checks to employees are mailed on Friday via campus mail. Student reimbursement checks are placed in student mailboxes unless otherwise directed.

The process as indicated above is necessary in order to maintain the integrity of our accounting system and allow us to maintain a reasonable workflow.


Section I:

Definition of a Fixed Asset:

A Fixed Asset is any tangible asset purchased for use in the day-to-day operations of the College from which an economic benefit will be derived over a period greater than one year and has a value of $2,000 or more. Fixed Assets include items of property and equipment such as buildings, office furniture, fixtures, computers and other related technology equipment.

Bulk purchases of similar items that have an aggregate value of $5,000 or more are captured as a fixed asset regardless of individual price of item. For example, the College purchases 100 desks at $50 each. The total purchase of $5,000 will be considered a fixed asset purchase.

Items that are routinely purchased as a set and have a value of $2,000 or more will be capitalized and depreciated. For example, if a table and four chairs were purchased from the “same vendor” as a set, and the cost of the table was $1,000.00 and the cost of each chair was $250.00 for a complete total of $2,000.00, then this purchase would be considered a capital expenditure. The total costs will be depreciated over the life of the asset.

At the time a fixed asset is acquired, its cost is capitalized and subsequently depreciated utilizing the straight-line method over the asset’s estimated useful life. Fixed assets with a value of less than $2,000 are expensed in the period acquired.

There are several types of capital assets. Specifically:

  • Moveable equipment, such as furniture
  • Fixed equipment, such as fixtures
  • Buildings and their components
  • Building Improvements, including department renovations
  • Land (not depreciated)
  • Land Improvements
  • Infrastructure
  • Software
  • Computer Hardware, peripheral equipment and other electronics

Moveable Equipment:

These items are not permanently affixed to a part of the building. Examples include chairs, desks, filing cabinets, bookcases, etc. Some moveable equipment consists of more than one component. For example, a computer, keyboard etc. The assembled components may be considered one time and recorded as a single capital asset. 

Fixed Equipment:

These items are permanently affixed to a building but is separate from the building itself. Examples are light fixtures, water fountains, fire control apparatus, etc.

Buildings and their Components:

Buildings are roofed structures used for permanent shelter of persons, furniture and equipment. Examples of building components are plumbing, electrical system, elevators, and HVAC systems.

Building Improvements and Department Renovations:

Major improvement projects that will extend the useful life of the asset, increase the efficiency, or add new capabilities will be capitalized. An example of this would be adding a new roof.  All costs including parts and labor will be included in the total cost of the project.

Parts and labor utilized to perform minor repairs on an existing asset of the College are considered period costs and expensed in the period incurred. This type of work is considered routine maintenance. Examples of this type of maintenance would be painting an office, replacing a faucet on a sink, or replacing carpet in an office.


Land is defined as the solid part of the earth’s surface whether improved or unimproved. Land does not get depreciated over time. The acquired value is recorded for the cost of the land.  Demolition costs are considered land costs.

Land Improvements:

Land improvements are modifications to outside areas. Examples include, installing sidewalks, parking lots, fences, and yard lighting.


Infrastructure is defined as an underlying base or foundation. For example, sewer lines, fiber optic, and steam lines.


Computer software includes all programs designed to cause a computer to

perform a desired function. It includes the database or similar items that are in the public domain. If the software can be purchased “off the shelf”, it may be expensed in the year purchased.

Hardware, Peripheral and Electronics:

Computer hardware includes all parts designed in order for the computer to function as intended.  It includes but is not limited to hard drives, monitors, key boards, printers and scanners.  Other electronics include backup peripherals, cameras, cellular phones, etc.

Purchasing  a Fixed Assets:

Purchasing a fixed asset is done in the same manner as any other purchase of goods if it has been approved through the capital budget process.  The department prepares a Purchase Requisition (attaching the packing slip and invoice), acquires approvals of the Budget Manager and the Budget Director and forwards to the Business Office for processing.

See the Procurement Policy or Requisition Instructions for further clarification. The following general ledger object codes are to be used for purchasing all Fixed


1701010         Land

1702010         Land improvements

1702030         Roads/Walkways/Lots

1703010         Buildings

1703020         Building improvement

1704030         Equipment

1704020         Transportation Equipment

1704010         Boats

1704040         Computer Hardware

1717050         Computer Software

1704060          Furniture and Fixtures

1704080          Donated Assets

****Technology purchases (including related items and supplies) must be ordered and/or approved by the Office of Information Technology.  Please review this policy at:

All purchases through and approved by OIT are tagged for inventory purposes without regard to price.****

Note:  New Construction and Capital Improvement Projects are addressed in Section II of this Policy.

Tagging of Fixed Assets:

Currently, there is no central Receiving Department for goods.  Therefore, the department ordering the goods will be the responsible party to receive the items ordered and ensure that what was ordered was received in good condition and correct. Generally, all orders are received with a packing slip. This packing slip. 

will be compared against the items received. Proper receipt of goods will be acknowledged by signing and dating the packing slip for attachment to the invoice and purchase requisition.

Upon receipt of the documents, the Business Office will process the Purchase Requisition. The proper object coding of the asset will allow the Datatel system to process the item(s) to the depreciation module, whereby, depreciation is calculated.

Capital purchases made with federal funds MUST be coded properly and  appropriate boxes checked on the purchase requisition so they may be  properly inventoried.  The Business Office will inventory all capital items purchased with federal funds at least every other year, if not annually.

****Technology purchases (including related items and supplies) must be ordered and/or approved by the Office of Information Technology.  Please review this policy at:

All purchases through and approved by OIT are tagged for inventory purposes without regard to price.****

OIT is responsible for preparing an inventory of items at least every other year, if not annually.

Movement of Assets:

Often it is necessary for departments to move fixed assets from one location to another. Only members of the Facilities staff should move capital assets. Movement of the asset will be completed after obtaining proper authorization by the requesting and receiving departments.  All computer equipment shall be moved only with the express written consent of OIT.

Disposal of Fixed Assets:

A department may have fixed assets that are no longer required due to:

A.  Excess of useful life

B.  Lack of need

C.  Obsolescence

D.  Wear, damage or deterioration

E.  Excess cost of maintenance

In all of the above, the asset is considered to be surplus property to the department.  The Department Head must ascertain the status of the asset. In some cases, the Department Head will consider the asset junk. These items are usually damaged items judged unsafe or too costly to repair. These items will be thrown away. Metal assets, such as bookshelves, metal desks etc. are recycled to a scrap iron company coordinated by the Facilities Department. Finally, some assets can be recycled or disassembled for parts or components for further use at the discretion of the Facilities Director.

The Facilities Department will notify the Business Office of the disposal for the appropriate change in the Fixed Asset System. Any residual value will be expensed in the period the item is being disposed and charged against the department’s budget.    It is the department’s responsibility to make arrangements with the Facilities Department to pick up and dispose of the asset.

Note: Disposal of computers and all technology related equipment is to be in accordance with OIT policies.

Section II:

New Construction and Capital Projects

In addition to new construction, major improvement projects that will extend the useful life of the asset, increase the efficiency, or add new capabilities, such as a new roof will be capitalized. All costs including parts and labor will be included in the total cost of the project.

Coding an Invoice with Retention

New construction projects and capital improvement projects often have a requirement to hold as retention a certain amount based on an agreed upon percentage of the invoiced amount. This acts as an insurance policy for the College in order to have the punch list items corrected after the construction project is completed by the contractor. The percentage is calculated based on the percentage of completion and/or milestones of the project. This retention is a liability to the College. The liability will be cleared out when final payment of the retention or partial payments of the retention are made to the contractor.

Placing Project into Service

Notification by the Facilities Department will be sent to the Business Office upon completion of the capital improvement project or new construction project. Upon receipt of the notification, the Business Office will transfer the improvement project or new construction project from the Construction in Progress general ledger account to the appropriate fixed asset general ledger account as determined by the Business Office. The project will then be added to the Fixed Asset System and depreciation will be calculated.

Section III:

Purchased Assets

The value of the asset is determined by including the purchase price of the item, transportation costs, installation costs, and any other direct expenses incurred by the College in obtaining the asset. Subsequent items purchased, which fall under the $2,000 threshold are expensed immediately and not capitalized. 

Donated Assets

The value recorded by the College for a donated asset is market value on the date the gift was acquired. To determine the market value of the asset, the Department may use the appraisal price, the selling price to educational institutions of an equivalent item, and/or information on IRS from 8283.  If there are any questions regarding the valuation, the Department should contact the Business Office for assistance.

Leased Assets

The lessee records a capital lease as an asset and a corresponding liability. The initial recording value of the leased asset is fair value or present value of the minimum lease payments, excluding any executory costs such as interest.

New Construction

When the University constructs a depreciable asset for its own use, all direct costs are included in the total cost of the asset.  This includes items such as

architectural, engineering, legal, consulting, project management from outside sources, etc.  Fixed overhead costs are not included unless they are increased by the construction of the asset. If there are any questions regarding what should be included in the cost of the new construction, contact the Business Office for assistance.

Capitalized Interest

Interest cost incurred from tax-exempt borrowings to finance construction of assets is capitalized. The value is based on the total interest expense less total interest income earned on the related interest- bearing investments. Capitalized interest is calculated from the date of the borrowing to the date the asset is placed into service.