Navigate Up
Sign In
Click to show/hide contact information.

Procurement Services Spring Newsletter: April 2016

Director's Message

It is a pleasure to join the staff here at UC Santa Cruz. In my first couple of months I have been impressed with many things. I have found the people at UCSC to be hard working and very committed to the mission of this institution. This includes an experienced procurement team that works every day to acquire the goods and services our campus clients need. 

In the months ahead, Procurement Services will be establishing a new mission/vision statement along with our shared work place values. In our business, we have many regulations and policies to be concerned with, but nothing is more important than the people we serve; this includes our faculty, our staff, our students and our business community.

We will continue to play an active role in shaping UC procurement policies and practices, including the current P200 initiative, and also monitor pending legislation that can impact our contracts and purchases. I have had the opportunity to work with my counterparts at other UC campuses, and believe there is much we can achieve by working together. While I am impressed with the other UC schools, there is no place I would rather be than Santa Cruz.

Thank you for the opportunity to serve you.

Darin Matthews, CPPO, CPSM
Director, UCSC Procurement Services

UCOP System-Wide Agreements

Looking for greatest savings and service? Consider utilizing one of the existing UC Procurement System-Wide Procurement Agreements.

By consolidating system-wide spend with frequently contracted suppliers, the UC leverages the greatest savings in UC specific agreements that are available for use by all of the campuses. These strategically sourced agreements can often meet your department’s unique needs.

Procurement Services is striving to make University contracts more identifiable and the procure-to-pay (P2P) process easier. It is important that you get what you need efficiently, effectively, and from responsive and responsible suppliers.

UC Procurement is also concentrating on improving the contracts themselves, to ensure the best pricing and value. Suggestions for improvement or implementation of new agreements are welcome.

Join in the system-wide effort to achieve greatest savings for the UC by using UCOP Strategically Sourced Agreements whenever possible.

Procurement Services provides access to UC System-Wide Agreements on its website.

Employee or Independent Contractor: An Important Distinction

Ever wonder if an individual should be paid as an employee or as an independent contractor? What defines an employee? What defines an independent contractor? And more importantly, what impact can this distinction have on UCSC?

There are significant financial repercussions associated with certain worker classifications. Generally, employers (UCSC in this case) are legally required to withhold income taxes, withhold and pay Social Security and Medicare taxes, and pay unemployment tax on wages paid to employees. Conversely, an employer does not withhold or pay any taxes on payments to independent contractors. Independent contractors are solely responsible for their own tax liability and their own Social Security and Medicare contributions.

As a result, the IRS actively audits and screens employer records to certify they are performing due diligence in determining a worker's status. If the IRS determines an employer has misclassified an employee as an independent contractor, they can levy back taxes, penalties for late payment, penalties for filing incorrectly, and other significant penalties.

But how is a worker's classification determined? The IRS focuses on three areas when determining whether a worker is appropriately classified: behavioral control, financial control, and relationship of the parties' involved. These three areas are often termed the "right-to-control" tests, because each factor is designed to evaluate who controls how the work is performed. The more control an employer has over how, when, where, and by whom the work is performed; the more likely the worker is an employee, not an independent contractor.

Behavioral Control covers facts that show whether the business (UCSC) has a right to direct or control how the work is done, through instructions, training, or other means.

Financial Control covers facts that show whether the business (UCSC) has a right to direct or control the financial and business aspects of the worker's job. This includes:
  • The extent to which the worker has unreimbursed business expenses
  • The extent of the worker's investment in the facilities, equipment, and materials used in performing services
  • How the business pays the worker, and
  • The extent to which the worker can realize a profit or incur a financial loss outside of wages not earned
Relationship of the Parties covers facts that show how the parties perceive their relationship. This includes:
  • Written contracts describing the relationship the parties intend to create
  • The extent to which the worker is available to perform services for other, similar businesses
  • Whether the business provides the worker with employee-type benefits, such as insurance, a pension plan, vacation pay, or workman's compensation
  • The permanency of the work relationship, and
  • The extent to which services performed by the worker are a key aspect of the regular business of the company
As you can see there are many variables, and no one hard and fast definition; the determination is based on the facts and circumstances of each individual's situation. The UCSC Independent Contractor Pre-Hire Worksheet is a tool to assist departments with determining the correct classification.

Contact Paul Schell if you have any questions about the UCSC Independent Contractor Pre-Hire Worksheet or with questions about independent contractor classification.

Contract Signature Delegation

Stop - don’t sign that contract.

For contracts involving procurement of goods or services, only Procurement Services officials have the proper delegation of authority to sign contracts and legally bind the University. This includes zero-cost contracts and point-and-click agreements.

The link to the applicable delegation policy is found here.

If an unauthorized individual enters into an agreement on behalf of the University, they risk adverse consequences to themselves personally and to the University.

Attach only unsigned copies of the contract to the CruzBuy requisition. After receiving a Business Contracts approval, and ensuring all other policy requirements are met, Buyers will finalize contracts by signing any applicable documents and retrieving the supplier’s signature.

After all signatures have been finalized, an electronic Purchase Order (PO) will be issued to the Supplier.

A contract must be finalized in accordance with policy before services start or delivery of goods is initiated. Suppliers should not start performing services, or deliver goods to the University, before they receive a University PO with a fully-executed contract signed by a University Procurement Services official.

If you have questions about signing procurement contracts, contact Nikki Vamosi in Business Contracts for more information.

Sustainable Procurement

By making environmentally preferred products available at best pricing, UC Procurement is making great strides in supporting its environmentally preferable purchasing goals.

UC's environmentally preferable purchasing guidelines encourage the use of EPEAT™, ENERGY STAR™, and Green Seal™-certified products.

All office equipment requires an ENERGY STAR™ designation in UC systemwide contracts, this includes personal computers, copiers, and printers. Additionally, every computer and monitor that UC buys must achieve a minimum Bronze rating under the Electronics Products Environmental Assessment Tool (EPEAT™).

By leveraging its purchasing power, UC has also been able to successfully drive down the cost of environmentally preferable products (EPP) for the campuses. Under the UC's latest contract for office paper, the cost of paper with 100% post-consumer waste (PCW) content is lower than the price of 30% PCW or even virgin paper.

Note - there are countless other EPP options for office supplies, but not all of them are created equally.

Many of the products flagged “green” by manufacturers rely on immaterial, confusing or purposely vague claims about the use of virgin/recycled material in the product and its packaging, use of renewable resources in manufacturing and landfill impact.

Former UCSC Procurement Services’ 2013-14 sustainability intern, Sierra Ellison-Swabey, created a list of green office products validated by the University and classified as “Best” (These products listed have anywhere between 75% to 100% PCW or Post-Consumer Waste) and “Good” (These products have anywhere between 0% to 74% PCW or Post-Consumer waste. If it has 0% PCW, it has some form of Pre-Consumer waste, which also flagged it as an EPP product). This list is accessible in CruzBuy under Favorites in the “Environmentally Preferred Office Supplies” section.

So how is UCSC doing with EPP Office Supplies on its campus? The following matrix is from the 2014-15 Annual Sustainability Report:

While these numbers are optimistic, UCSC definitely has an opportunity to increase its EPP numbers. When making your next purchase, please consider EPP options.

Conflict of Interest in Procurement Transactions

As a best practice, conflict of interest issues need to be considered every time a purchase or contract is considered to ensure the transaction is in-line with applicable policy and law.

A conflict of interest exists when an employee’s personal, professional, commercial or financial interest or activities outside the University may have compromised the employee’s judgment, created bias, unduly influenced their decision or resulted in personal financial gain.

When a requisition is submitted, note on the requisition, either in the internal notes section or by placing a comment on the CruzBuy requisition, if the supplier is:

  • An existing University employee;
  • A former University employee;
  • An immediate family member of a current employee; or
  • A company owned in part by a current employee.

For services, additionally respond to the conflict of interest question on the CruzBuy Services form.

In general, University employees are not permitted to rent, sell or provide goods or services to the University because of a potential financial conflict of interest.

There are limited exceptions for employees with teaching or research responsibilities if they can certify that they were not involved, in any way, in making the decision to select themselves as the supplier. To request an exception in this area for teaching or research employees, fill out the University of California Santa Cruz Employee-Vendor Relationship Disclosure form found below, and attach to the CruzBuy requisition for review and approval by Business Contracts.

Employee Vendor Disclosure Form

A potential financial conflict of interest also exists when the supplier is an immediate family member. In this case, the University of California Santa Cruz Employee-Vendor Relationship Disclosure form also needs to be completed and attached to the CruzBuy requisition.

There are also conflict of interest restrictions on hiring former employees as a supplier. If you are submitting a services requisition for a supplier who is a former employee, notify Business Contracts via a comment on the CruzBuy requisition. Business Contracts will review the UCSC Independent Contractor Pre-Hire Worksheet and perform a conflict of interest evaluation to determine if the transaction can proceed.

Finally, suppliers who are consultants that have performed work for the University cannot participate on subsequent projects related to or implementing the consultant’s findings because it is a conflict of interest. This is often called a successor contract or follow on contract. It is essential that consultant agreements outline all of the necessary deliverables in the first engagement to avoid a successor contracting conflict of interest issue. If you are submitting a requisition for consultant work that is related to, or an extension of, a previous engagement, notify Business Contracts via a comment on the CruzBuy requisition to have a conflict of interest analysis performed.

Conflict of Interest questions related to a procurement should be directed to the Procurement Services Director, Darin Matthews or Business Contracts Manager, Nikki Vamosi. All other conflict of interest questions should be directed to the campus Conflict of Interest Coordinator, Gennevie Herbranson, located in the Office of Campus Counsel.

Using the Correct CruzBuy Form

Occasionally, a Buyer in Procurement Services may return a requisition to the requester indicating that the incorrect form was used for the purchase. So why does using the correct form matter?

Each form in CruzBuy has specific workflow rules behind the scenes. These rules route the requisition to the correct UCSC employees for approval or notification to review the requisition without the need to approve. Using the incorrect form for a purchase may bypass the required approvals or notifications.

In addition, several forms require answers to questions which assist with order processing and ensure campus compliance with both state and federal policy.

As an example, not only will the Food & Entertainment form route to different approval folders than, say, the Services form, but how the questions are answered may trigger additional workflow steps or indicate that supporting documentation is required for the purchase. Therefore, using the Services form rather than the Food & Entertainment form for an F&E purchase will result in missing approvals and possible liability risks.

Using the correct form and answering the questions presented on the forms correctly will minimize risk to the University and will assist with order processing efficiency.

The Resources section of the How to Buy Guide has a segment called Commodities and Associated CruzBuy Forms which provides a list of common purchases and the correct form to use.

Employee Corner

Darin Matthews, Director, Procurement Services Darin Matthews
Darin Matthews comes to Procurement from Portland State University (PSU) with over 20 years of experience in the public and private Procurement sectors. Darin was Contracting and Procurement Director as well as an Adjunct Faculty member at PSU. In addition, Darin has authored numerous publications including books, magazines, and technical journals and presented a variety of courses and presentations throughout the world. Darin has several certifications including Certified Public Procurement Officer (CPPO) and Certified Professional and Supply Management (CPSM). It is not all work and no play for Darin; he loves motorcycles and he is devoted to the King of Rock & Roll. Please join us in welcoming Darin to Procurement!

Procurement Services Metrics

The bar graph shows the total number of requisitions processed by Business Contracts out of the total processed by Procurement Services between July 1, 2015, and March 31, 2016.

The bar graph shows the total number of requisitions processed by month between July 1, 2015, and March 31, 2016, including those processed by Procurement Services.


The pie chart below highlights all requisitions processed between July 1, 2015, and March 31, 2016, with turn time breakdowns for Procurement Services staff. Turn times are based on time between final department approval and final Procurement approval.

As part of the system-wide P200 initiative, UCSC Procurement Services buyers set a goal to realize $1.8 million in benefit for Fiscal Year 2016. As of February 2016, UCSC buyers have negotiated direct savings of $636,188 for our campus plus an additional $428,528 for purchases made during this fiscal year based on legacy agreements established prior to Fiscal Year 2016, for a total of $1,064,762. The graph below breaks down the current fiscal year’s cost savings (not including legacy) by division/department groupings.
When planning a large dollar/volume purchase, please reach out to Procurement Services at the earliest opportunity. Engaging Buyers early in the process allows them to develop the most ideal cost-saving strategy.


uBuy Sourcing Director

When a procurement requirement is over $100,000 in total value, reasonable price is established through formal competition sufficient to ensure an adequate market test. The UC refers to this as a bid event.

California Public Contract Code Section 10507 et seq. requires that all purchase contracts and/or agreements involving an expenditure of more than $100,000 annually be awarded to the lowest responsible bidder meeting specifications, or all bids shall be rejected.

The lowest responsible bidder shall be determined on the basis of one of three bid evaluation methodologies: (1) Cost alone, (2) Cost Per Quality Point, or (3) Best Value.

At the beginning of November 2015, UC launched its newest e-procurement tool in uBuy (University of California Public Bid Site). The uBuy Sourcing Director (SD) module has replaced Supplier Registration and Sourcing (SRS) for all new bid events.

The improvements provided with the new system will allow UC Procurement Services to further enhance sourcing processes and drive savings to education and research. A better user interface, more reliable performance, multi-stage event capability and an enhanced reverse auction system are just some of the exciting new benefits the new application offers. Since the launch of SD in November, 143 events have gone live systemwide.

One of the many UC goals for this new platform was to apply best practices, standardization and transparency to all bid events for the entire UC system. With this approach, UC has the ability to leverage opportunities for collaboration with multiple campuses as well as speaking as one voice, not ten with our suppliers.

UC Santa Cruz currently has multiple events in the bid pipeline using Sourcing Director. The expected results locally are an enhanced process and faster results.

The most important element of bid event success, however, starts with early collaboration. To achieve optimal results and swifter outcomes, it is highly recommended that bid project teams assign a project manager, develop a comprehensive scope of work and involve Procurement Services early in the process.

Questions related to bid events or bid requirements should be sent to Kathleen Rogers, Strategic Sourcing Manager in Procurement Services.

Fiscal Year-End Purchase Requisition Processing

As we close in on the end of another fiscal year (June 30th) the Procurement Services Office is preparing for a smooth transition into the next fiscal year. There are a number of fiscal year-end considerations in regards to the procurement of materials and services that we would like to pass along.

For departments wishing to expense funds in the current fiscal year, the necessity to pre-plan for services, supplies and equipment needs cannot be over-emphasized. The time required by Procurement to process your requisition is in addition to the time it takes the requisition to process through the approval cycle within the university. Delivery, however, will always depend on the supplier's stock and any issues they have in securing delivery from their suppliers.

Also, remember buyers must comply with all identified policy requirements, including supplier non-standard contract review and approval from Business Contracts, additional competitive bidding that may be required, and/or any new supplier on-boarding to the supplier database. All of these may potentially lengthen the time needed to complete the requisition approval process. It is advisable to submit your requisition as soon as the requirements are known to insure department timelines are met for fiscal year end.

Submission of requisitions well in advance of the required delivery date is encouraged. Departments should anticipate their requirements to allow adequate lead time for goods and services orders to be processed and products to be delivered.
University of California Santa Cruz, 1156 High Street, Santa Cruz, Ca 95064
© 2018 Regents of the University of California. All Rights Reserved.

Site Feedback