University of Washington
Administrative Policy Statements		 Rev/December 1981 59.1

Table of Contents

1. Outside Service Contracts

2. Purchase of Outside Services from Employees or Relatives of Employees

3. Advance Filing Required for Personal Services Contracts

4. Forms to be Completed When Requesting Outside Services
      

Contracting for Outside Services

(Approved by the Executive Vice President by authority of Executive Order No. 5)


1.   Outside Service Contracts

When specialized skills, knowledge, resources and experience are needed which cannot be provided reasonably by existing departmental staff or University service departments, such services may be obtained from firms or individuals outside the University on a fee for service or contract basis. A request must be made and appropriate approval(s) obtained as described in this policy statement.

a.   Checklist for Determining Whether the Required Services Should Be Performed by Someone Hired as a University Employee or Under an Outside Services Contract

Under no circumstances should a personal services contract be used to bypass competitive employment procedures or to accomplish a job that:

  • A present employee can do;

  • Could be accomplished by resources available within another University department; or

  • Calls for full-time, continuous employment.

In order to assist departments in determining whether an individual should properly be treated as an employee and placed on the payroll as opposed to hiring an outside services contract, the following checklist should be consulted. The existence of any one or more of the listed conditions will indicate that the prospective hiree should probably be treated as an employee:

  • The individual is already a University employee.

  • There is no limited time frame for the employment, i.e., the work for which the individual is being hired is of a continuing nature and not a single transaction.

  • The individual will be under the supervision of University personnel.

  • University personnel will have the right to control the procedures by which the results of the work for which the individual is to be hired are obtained.

  • The work for which the person is to be hired requires the use of University equipment and will be performed in University facilities.

  • The individual is not an independent business person performing services for hire on the same basis for others as for the University.

  • The type of work for which the person is hired is not unique, but is the type of work for which personnel are normally hired at the University.

If it is found, after reviewing the above criteria in light of the circumstances surrounding the proposed employment situation, that the work the individual is to be hired to perform falls outside the criteria, then it may be appropriate to retain the individual on an outside services contract.

b.   Requests for Outside Services Contracts

All requests for outside services contracts, regardless of source of funding, must be submitted to the Purchasing Department for processing.

2.   Purchase of Outside Services from Employees or Relatives of Employees—(Conflict of Interest as Applied to Purchasing Transactions)

Under the Employee Conflict of Interest policy (University Handbook, Volume 4, Part V, Chapter 2), University employees may not participate in purchasing transactions which involve economic benefit to themselves, their immediate families, or businesses with which they are directly associated. Questions relating to specific transactions should be directed to the Director of Purchasing, 206–543–5828.

3.   Advance Filing Required for Personal Services Contracts

a.   Definitions

The term outside services contract refers to those contracts entered into by the University for services to be provided by an organization or person external to the University. Some types of outside services are considered to be personal services. This refers to an agreement with an independent contractor for the rendering of specific types of services; included within the scope of personal services are:

  • An individual or organization performing a specific study, project or task where the criteria for performance is dependent upon the professional and technical expertise of the individual or organization.

  • Individuals not performing a specific study, project or task but who are retained on a contract basis because of the individual's particular expertise.

  • Those contracts let for a specific study, project or task that are not normally handled through an open competitive bidding process due to the particular professional or technical expertise required.

A personal services contract should require the rendering of an opinion, judgment or recommendation, within a given time frame. In a relationship with an independent contractor, the state has no right to supervise or control how the work required by the contract is done. The independent contractor is solely responsible for the results called for by the contract.

The Purchasing Department ensures that state of Washington filing requirements, as described below, are satisfactorily met before any work may commence under the contract.

b.   Personal Services Contracts Subject to Ten-Day Advance Filing

Whenever the total cost for all services from an outside contractor exceeds $2500 within a 12-month period, state law requires the contract to be filed in Olympia at least ten days in advance of the day that work will begin under the contract.

Note:  This total cost is accumulated for all University departments as a whole, not for each department individually. This means that the requesting department may have much less than $2500 worth of business with a contractor; however, if the accumulated total for the University with that same contractor exceeds $2500 then the requesting department's contract for service must be filed in advance.

Failure to comply with the ten-day advance filing requirement may result in a $300 civil penalty levied against the person who authorized the work to commence without proper filing.

The Purchasing Department files outside service contracts with the Office of Financial Management (OFM) and the Legislative Budget Committee as required by state law. The Purchasing Department must submit a state of Washington Personal Services Contract Filing Face Sheet for each outside service contract filing.

The department requesting the outside services must complete the Personal Services Contract Filing Face Sheet when a single contract exceeds $2500 (including contract renewals and amendments) and forward it, along with a Request for Purchase form to the Purchasing Department for review and filing with the state.

When the contract cost is less than $2500, only the Request for Purchase form is required. Instructions for completing these forms are given in section 4 of this policy statement.

c.   Requesting a Waiver for Genuine Emergencies

If a genuine emergency requires immediate outside services, a waiver from the ten-day advance filing requirement may be requested. In such cases, immediately notify your buyer in the Purchasing Department so that expedited arrangements can be attempted. The Personal Services Contract Filing Face Sheet form must be completed as rapidly as possible and this form, along with a copy of the contract/proposal must be provided to the Purchasing Department which in turn will file it with the Office of Financial Management (OFM). The director of OFM, after consultation with the Legislative Auditor, will either approve or disapprove the waiver from the ten-day advance filing requirement. The request for a waiver must be made prior to actual commencement of the contract work and adequate justification must be provided.

d.   Outside Services Contracts Exempt from Advance Filing Requirement

Some outside service contracts are exempt from the advance filing requirement under a limited number of circumstances; these include:

  • Intergovernmental agreements awarded to any federal, state, or local governmental entity or any department, division, or subdivision thereof. This exclusion does not apply to private nonprofit or quasi-governmental organizations.

  • Contracts awarded through competitive bids if the bidding follows a formal, documented bid procedure and if the request for bids is advertised through the media normally used by the particular service being sought.

  • Contracts awarded to companies that furnish a service where the tariff is established by the Utilities and Transportation Commission or other public entity.

4.   Forms to be Completed When Requesting Outside Services

Important note:  The forms described below must be received by the Purchasing Department at least 15 working days in advance of the date on which the outside service is needed. This will allow the Purchasing Department the minimum time necessary for:

  • The execution of any contractual agreement required; and

  • The preparation and/or mailing, receipt, and filing of the Personal Services Contract Filing Face Sheet form with the Office of Financial Management and the Legislative Budget Committee at least ten calendar days prior to commencement of any work under the contract as required by law.

State regulations stipulate that any contract filed late must be justified in detail as to the circumstances surrounding the late filing. Any request for outside services that is not submitted to the Purchasing Department 15 days in advance will require a letter of justification from the department before the filing will be made and a contract issued.

a.   Completing the Request for Purchase for Outside Services

Prior to making a commitment to an outside contractor, the department requesting the service should prepare and submit to the Purchasing Department a Request for Purchase form giving as much of the following information as possible:

#1   Description of the service required; specify the end product, measurable result or primary benefit to be gained.
#2   Brief explanation describing why the service cannot be performed by existing University personnel or by someone who could be hired as a University employee. (For further information, see Section 1.a.)
#3   Projected time schedule for award of contract, starting date (be sure to allow 15 working days for filing the form as described in Section 3), progress report due dates (if applicable) and completion date.
#4   Selection process to be used. If a single source (i.e., one particular contractor) must be used because of unique qualifications or background experience, indicate the circumstances which justify using that source and provide the following information:

  • Name and business address of the contractor.

  • State of Washington Business License Number or the individual's social security number.
#5  

Estimate of the maximum fee involved and travel or other related costs.

Note:  A continuation sheet may be attached to the Request for Purchase form if more space is needed; type "continued" at the bottom of the description section of the form and use plain white paper for the attached sheet. Be sure to type the requisition number at the top of the continuation sheet.

b.   Completing the Advance Filing Form

If the total contract services to be performed by an outside contractor for a University department is estimated to be greater than $2500 including the original contract plus any amendments or renewals, the requesting department must also complete the state of Washington Personal Services Contract Filing Face Sheet form. Copies of this form are available from University Stores.

Note:  Even though the requesting department's contract is less than $2500, an advance filing is required if the total of all University contracts exceeds $2500 in a 12-month period. The Purchasing Department is responsible for accumulating the total dollars spent for services from outside contractors. For this reason all contracts for outside services must be submitted in advance to the Purchasing Department, regardless of the dollar amount for each individual contract.

The Personal Services Contract Filing Face Sheet form should be completed as fully as possible and submitted with the Request for Purchase form.

Reminder: These forms must be received by the Purchasing Department at least 15 working days in advance of the date on which service is needed.

c.   No Work May Commence Under Any Outside Services Contract Until the Department is Notified by the Purchasing Department

For contracts requiring submittal of the Personal Services Contract Filing Face Sheet form, the notification will be accomplished by return of a copy of the form, indicating that the filing requirements have been met. For other types of outside services contracts, the notification will usually be made by phone.

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