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Contracting Guidelines and Procedures

> Contracting Guidelines
> Standard Contracts
> Unique Contracts
> Contracting Procedures

Contracting Guidelines

University of Minnesota contracts covered by these guidelines include, among others:

• Agreements to buy or sell goods;
• Agreements to provide or obtain services;
• Volunteer agreements;
• Memoranda of Understanding with government agencies and other organizations for the accomplishment of a particular purpose;
• Promissory notes and other instruments for the payment of money;
• Grants and subgrants awarded by government agencies and private organizations;
• Affiliation agreements;
• Leases of movable property, such as tools, equipment, vehicles, etc.;
• Leases, deeds, and other conveyances affecting interests in real property;
• Employment contracts;
• Waivers and releases;
• Debt instruments and related documents;
• Maintenance agreements; and
• Software license agreements.

Standard Contracts:

Most University of Minnesota contracts can be entered into using Standard Contracts that have been pre-approved by the Office of the General Counsel (OGC), and are available on-line in the University's Standard Contracts Library. Standard Contracts adequately protect the University's interests, are written in clear language, expedite the contracting process, and are intended to be fair to all parties. Contractual transactions entered into using a Standard Contract do not require additional OGC review and approval. However, if a Substantive Change is made to the Standard Contract, OGC must review and approve the contract before it can be signed. See Regents' Legal Review of Contracts and Agreements policy. Substantive changes do not include inserting the description of the goods or services, the price, and other requirements provided in the PDF-fillable areas.

Unique Contracts:

Unique Contracts are prepared by OGC when a Standard Contract will not adequately satisfy the parties' needs and University policies.

Be aware that a University of Minnesota official without prior OGC approval cannot sign another party's contract. To have OGC review another party's contract, please call the Transactional Law Services Group at 612-624-4100 or by emailing contracts@mail.ogc.umn.edu.

Contracting Procedures

The following procedures apply to all contracts, contract modifications, and amendments:

Step One - Determine Who Has Authority to Sign

If you need a contract, determine who has the authority to sign the type of contract you need. Make sure that the individual will take responsibility for the transaction and sign the contract. Make sure that you comply with requirements established by the vice president, dean, director, or department head in whose organization the unit is located. These unit-based procedures are in addition to requirements established by the President's Delegations of Authority. They ensure that the contract fulfills compact and mission obligations, that funds are available and have been properly encumbered, and that other resources necessary to complete the contract are available.

No University college, department, center, institute, or other entity has authority to contract in its own name or independent of the University.

Step Two - Obtain Approvals

A. Subject Matter Approvers (SMAs)

The President's Delegations of Authority require that Purchasing Services, Real Estate Office, Sponsored Projects Administration, Office of External Sales, and Patents and Technology Marketing approval contracts involving their respective subjects. Initiate the approval and contracting process for transactions requiring subject matter approval by using the request form available at the website of the respective SMA or attached to a Standard Contract in the Standard Contracts Library.

If you need a contract that does not require approval by a SMA and for which a Standard Contract will be used, then access the Standard Contract from the Standard Contracts Library, complete the business terms in accordance with the instructions, and have the individual authorized to sign the contract sign it.

If you have questions about which Standard Contract to use or how to use it, or if changes to the terms and conditions are required, notify the OGC's Transactional Law Services Group at 612-624-4100 or email contracts@mail.ogc.umn.edu.

Compliance requirements applicable to contracts including but not limited to EOAA, IACUC, and IBC must also be satisfied in addition to Delegation of Authority Approvals.

B. Funding Approval

If the Board of Regents has reserved approval of the contract because of the amount of money involve, then the Chief Financial Officer or his designee must approve the contract before it can be submitted to the Board of Regents. Where required, Signature Authority is invalid without Funding Approval.

C. General Counsel's Approval

The Board of Regents (BOR) requires that the Office of the General Counsel (OGC) assure that contracts comply with the requirements of the BOR's Legal Review of Contracts and Agreements policy. Specifically, the contract must not violate law or policy, the individual signing it must have authority to do so, and any unique legal risk must have been considered by the individual who signs the agreement.

If a Standard Contract cannot be used for the transaction, then OGC will help you prepare a Unique Contract or modify either a Standard Contract or a contract proposed by the vendor or other party with which you desire to contract. If the contract is one that requires Subject Matter Approval, the Subject Matter Approver (e.g., Purchasing Services, etc.) will involve OGC. If there is no SMA approval, then email a General Request Form to OGC at . You may also call the Transactional Law Services Group at 612-624-4100.

Legal Review of Contracts and Agreements provides that OGC "may exempt from individualized legal review certain routine contracts provided that an appropriate legal framework exists with respect to such contracts." OGC and Human Resources (HR) have created an appropriate legal framework for employment contracts and certain other employment issues. These transactions require OGC approval only if HR requests OGC's advice.

Where required, Signature Authority is invalid without Legal Approval.

Step Three - Contract Signing

The individual identified in Step One may sign a Standard Contract for purchase of goods and services under $10,000 and for real estate use agreements and leases under $10,000.

The individual identified in Step One shall authorize the Director of Purchasing Services to sign contracts for purchases of $10,000 or more by signing an internal document that authorizes the transaction. See Purchasing.

The individual identified in Step One may authorize the Director of Real Estate to sign use agreements and leases of $10,000 or more or may sign them after obtaining all required approvals. See Real Estate.

The individual identified in Step One may sign a Standard Contract that requires no approvals or that has been approved as required by the President's Delegations of Authority.

The individual identified in Step One may sign a Unique Contract that has been approved as required by the President's Delegations of Authority.

Step Four - Contract Retention

The Records and Information Management Coordinator, who may be reached at 612-625-3497, administers the University's records retention rules and policies that apply to contracts. In addition, any provision of the contract requiring retention by the parties must be satisfied.

Step Five - Contract Administration

Unless otherwise provided by University policy, the individual who signs the contract is responsible for properly carrying out the terms of the contract for the University. It may be advisable to establish a matrix or database that will reflect the contract including, but not limited to, performance dates, payments to or from the University, receipt of certificates of insurance, performance bonds or letters of credit, etc. Failure to monitor these requirements can expose the unit and the University to financial loss, legal actions, and potential claims of breach of contract or default. If the individual who signs has any questions regarding these matters, she/he should either call the Transactional Law Services Group at 612-624-4100 or email contracts@mail.ogc.umn.edu.

These guidelines and procedures are subject to periodic revision and review. We invite you to forward your comments and suggestions to OGC at contracts@mail.ogc.umn.edu.

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