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Virginia Economic Development Partnership Purchasing Policies & Procedures Manual

Summary

Purchasing Policies & Procedures Manual of the Virginia Economic Development Partnership, with dates revised of 01/14/2021 and 10/22/24. Its table of contents lists sections on ethics in public procurement, general procurement policies, specific rules and authorizations, standard procurement and payment methods, internal controls and record keeping, and other considerations. Listed methods include electronic procurement through eVA, corporate purchasing cards, state contracts and emergency purchases, with formal bids listed for $50,000 and above. Policy 6.6 provides that property no longer needed by VEDP is to be considered surplus property, that the Controller makes that determination, and that the Facilities Manager coordinates transfer or disposal.

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Full text

                 Virginia Economic Development Partnership
                         Purchasing Policies & Procedures Manual


INTRODUCTION .............................................................................................................. 1
SECTION 1: ETHICS IN PUBLIC PROCUREMENT .................................................... 3
SECTION 2: GENERAL PROCUREMENT POLICIES ................................................. 5
  2.1 VEDP Procurement Office (Central) ............................................................ 5
  2.2 VEDP Purchasing Agents (Divisions) .......................................................... 7
  2.3 VEDP Management Responsibility.............................................................. 9
SECTION 3: SPECIFIC RULES AND AUTHORIZATIONS ....................................... 10
  VEDP Procurement Levels.............................................................................. 10
  3.1 Advertising, Marketing and Promotional Items ......................................... 13
  3.2 Air and Rail Tickets ................................................................................... 14
  3.3 Business Cards and Stationery ................................................................. 15
  3.4 Computer Hardware, Software and Related Services ............................... 16
  3.5 Conferences, Trade Shows, Sponsorships, and “Master Bills” ................. 17
  3.6 Cooperatives and Joint Ventures ............................................................. 18
  3.7 Express Mail ............................................................................................. 19
  3.8 Maintenance Services ............................................................................... 20
  3.9 Office Supplies, Furniture, Equipment (except Computers), and Other
       Goods ..................................................................................................... 21
  3.10 Real Estate and Construction .................................................................. 22
  3.11 Research Services .................................................................................. 23
  3.12 Services (Professional and non-Professional) ......................................... 24
  3.13 Telecommunications (Office Phones, Mobile Phones, Calling Cards,
       Voice Mail, Data Lines) ........................................................................... 25
SECTION 4: STANDARD PROCUREMENT AND PAYMENT METHODS ............. 26
  4.1 Electronic Procurement – eVA .................................................................. 26
  4.2 Corporate Purchasing Cards .................................................................... 28
  4.3 State Contracts.......................................................................................... 35
  4.4 Emergency Purchases .............................................................................. 36
  4.5 Sole Source ............................................................................................... 38
  4.6 Non-Compete Determination ..................................................................... 40
  4.7 Proprietary Products.................................................................................. 41
  4.8 Informal Bids (Authorized for purchases up to and under $50,000) ......... 43
  4.9 Formal Bids - $50,000 and above (IFB's and Sealed Bids) ....................... 45
  4.10 Competitive Negotiations - Request for Proposals (RFP) ....................... 47
  4.11 Contracts ................................................................................................. 49
SECTION 5: INTERNAL CONTROLS AND RECORD KEEPING ............................ 50
  5.1 Budgetary Controls.................................................................................... 50
  5.2 Procurement Documentation ..................................................................... 52
  5.3 Expenditure Coding ................................................................................... 53
  5.4 Receipt of Goods and Services ................................................................. 54
  5.5 Vendor Invoices, Payments, and Lease Purchases .................................. 56
  5.6 Audit Reviews............................................................................................ 58

TABLE OF CONTENTS
Date Issued: 7/1/96; Date Revised: 01/14/2021; 10/22/24
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   5.7 Freedom of Information Act ....................................................................... 59
SECTION 6: OTHER CONSIDERATIONS................................................................... 60
  6.1 Preferred Vendors ..................................................................................... 60
  6.2 Debarred Vendors ..................................................................................... 61
  6.3 Vendor Insurance, Performance Bonds, Bid Bonds ................................. 62
  6.4 Vendor Performance Monitoring................................................................ 63
  6.5 Vendor Appeals, Disputes, and Remedies ................................................ 64
  6.6 Surplus/Unclaimed Property ..................................................................... 66




TABLE OF
CONTENTS

Date Issued: 7/1/96; Date Revised: 01/14/2021; 10/22/24
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INTRODUCTION

This Purchasing Policies & Procedures Manual establishes the policies and procedures to
be followed by VEDP employees fulfilling procurement and related logistical
responsibilities within their delegated limits. VEDP employees shall utilize sound,
prudent, and generally accepted purchasing practices when purchasing goods and services.
All purchasing will support VEDP’s mission and will be in the best interest of the
Commonwealth of Virginia.

As an independent authority, the Virginia Economic Development Partnership is exempt
from the provisions of the Virginia Public Procurement Act (VPPA). VEDP will consider
the benefits of established State contracts to procure certain goods and services. Such
sources are not deemed “mandatory”, and VEDP management is responsible for
determining the appropriate and most desirable source for each procurement. All
procurement policies and procedures are established by VEDP’s President and CEO within
the authorization granted by VEDP’s Board of Directors.

VEDP Procurement Policies and Procedures do not apply to contractors with which
VEDP, or any of its subsidiaries, may engage.

VEDP’s Board of Directors has adopted these policies for the procurement of goods and
services. Such policies shall: guide all VEDP procurements and ensure that VEDP:

•   Seeks competition to the maximum practical degree.
•   Prohibits discrimination against a bidder or offeror based on race, religion, color, sex,
    sexual orientation, gender identity, national origin, ae, disability, status as a service
    disabled veteran, or any other basis prohibited by federal or state law relating to
    discrimination in employment.
•   Practices prompt payment principles for goods and services. Obtains high quality goods
    and services at a reasonable cost.
•   Conducts all procurements in a fair and impartial manner, avoiding any impropriety or
    appearance of impropriety.
•   Provides all qualified vendors reasonable access to public business and neither
    arbitrarily nor capriciously excludes or discriminates against any viable offeror.
•   Practices openness and administrative efficiency.
•   Allows flexibility in fashioning details of such competition.
•   Provides clear rules, in advance of competition, governing contract awards.
•   Draws specifications that reflect VEDP’s procurement needs, rather than being drawn
    to favor a particular vendor.
•   Freely exchanges information between purchasers and vendors, inasmuch as such
    exchange does not negatively affect VEDP’s business objectives or violate associated
    confidentiality requirements.

INTRODUCTION                                                                         1

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This manual provides instruction to all VEDP employees as they identify and pursue goods
and services procurements to fulfill VEDP’s business needs. However, as indicated herein,
specific responsibilities and authorities have been defined for purchasing goods and
services on VEDP’s behalf. All employees are therefore directed to the VEDP responsible
party, prior to pursuing any procurement.

Certain procedures and forms referenced in this manual are subject to change, as VEDP
continues to evolve its procurement operations and systems. In cases where this manual
appears to contradict instructions on forms or other materials, these policies and
procedures will take precedence.

The Controller and Procurement Manager are available to assist in any purchasing activity
and to interpret and apply these policies and procedures. The provisions of this manual
have been developed at the discretion of management and may be amended or canceled at
any time at VEDP’s sole discretion. These provisions supersede all previously issued
procurement policies and procedures and may not be amended or added to without the
express written approval of VEDP’s President and CEO within the authorization granted
by VEDP’s Board of Directors.

No member of VEDP management or representative has any authority to enter into any
agreement contrary to these policies and procedures relative to contracts, purchases or other
areas included in this manual.




INTRODUCTION                                                                          2
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SECTION 1: ETHICS IN PUBLIC PROCUREMENT

 POLICY:                     It is important that VEDP employees making procurements avoid
                             improprieties as well as the appearance of such improprieties. The
                             integrity and credibility of the procurement program requires VEDP
                             employees to be impartial, fair, and free of any relationships that may
                             cause them to be unduly partial to any vendor or product. It is up to
                             each individual to ensure they do not violate the spirit of procurement
                             ethics.

 PROCEDURES:                 Procurement ethics will always include but may not be limited
                             (depending on the circumstances) to the following considerations.

                                  1. Legitimate Business Need. The procurement of goods and
                                     services will be limited to those necessary to the operation
                                     and mission of VEDP, and its business interests.
                                     Purchasing of goods and services through VEDP’s
                                     procurement process
                                     for non-VEDP use is prohibited.

                                  2. Conflicts of Interest. A VEDP employee is prohibited from
                                     participating in a procurement transaction if they (or in
                                     some cases their spouse or family) have an interest in the
                                     potential vendor’s business.

                                  3. Gifts. No VEDP employee having official responsibility
                                     for a procurement transaction shall solicit, demand, accept,
                                     or agree to accept from a bidder, offeror, contractor, or
                                     subcontractor any payment, loan, subscription, advance,
                                     deposit of money, services or anything of more than
                                     nominal value, present or promised.

                                  4. Disclosure of Subsequent Employment. Any VEDP
                                     employee having official responsibility for a procurement
                                     transaction who accepts employment with a bidder, offeror,
                                     or contractor with whom he/she has dealt in any official
                                     capacity, must provide written notice to VEDP of their
                                     intention to accept such employment.

                                  5. Kickbacks. Kickbacks involve getting something of
                                     value from a bidder, offeror, contractor, or subcontractor in
                                     an attempt to influence the award of business and are



Section 1: ETHICS IN PUBLIC PROCUREMENT                                                     3
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                                       prohibited.

                                  6. Order Splitting.      The placement of multiple orders
                                     within other than a reasonable time period to one or more
                                     vendors for the same, like, or related goods and services to
                                     avoid using the appropriate method of procurement or to
                                     remain within the delegated purchasing authority is
                                     prohibited.

                                  7. Misrepresentations. Any VEDP employee having official
                                     responsibility for a procurement transaction is prohibited
                                     from knowingly falsifying, concealing or misrepresenting
                                     material facts concerning procurement.

                                  8. Insufficient Authorization. No employee shall obligate
                                     VEDP without having received prior written authorization
                                     from an approved official. To do so is a misrepresentation of
                                     authority.

                             Any questions regarding the above or other procurement ethics
                             issues, or the interpretation thereof, should be directed to the
                             Controller, or the Procurement Manager.

                             The willful violation of any of the above provisions may lead to
                             disciplinary and/or legal actions.




Section 1: ETHICS IN PUBLIC PROCUREMENT                                                   4
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SECTION 2: GENERAL PROCUREMENT POLICIES

2.1 VEDP Procurement Office (Central)

 POLICY:                     VEDP will establish and maintain a central Procurement Office,
                             reporting to the Controller, which will have overall responsibility for
                             developing, interpreting, and enforcing all VEDP purchasing
                             policies and procedures. In some cases (as specified herein),
                             approval from the Procurement Office will be required prior to
                             pursuing the purchase of goods and services on VEDP’s behalf.
                             Otherwise, the Procurement Office may delegate procurement
                             authority to Division Senior Vice Presidents and Vice Presidents, or
                             their designated Purchasing Agents, as long as such delegated
                             procurements are conducted in accordance with all applicable VEDP
                             policies and procedures.

 PROCEDURES:                 1. The Controller will maintain VEDP’s Purchasing Policies and
                                Procedures Manual, issuing updates or amendments as
                                necessary and approved by the President and CEO, and will
                                provide copies of the Manual to VEDP’s Procurement Manager,
                                Division Senior Vice Presidents and Vice Presidents,
                                Purchasing Agents, and other parties as appropriate and
                                necessary.

                             2. The Controller will designate a Procurement Manager as head
                                of the Procurement Office who will support the Director, and
                                VEDP in general, as regards purchasing activity, and will
                                maintain purchasing documentation and related files, as
                                specified herein, in good order. Although the Procurement
                                Manager will work closely with the Controller on a day-to-day
                                basis, the Procurement Manager is not authorized to approve
                                procurements which specifically require authorization of the
                                Controller.

                             3. The Controller may from time-to-time designate Purchasing
                                Agents, who typically will report to Division Senior Vice
                                Presidents and Vice Presidents, who will have certain
                                authorities to process and approve procurements within the
                                guidelines provided herein. If such guidelines or other policies
                                and procedures are not followed, the Controller may rescind
                                such authorizations.



Section 2: OVERVIEW OF VEDP PURCHASING                                                      5

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                             4. The Procurement Manager will maintain a record of all
                                Purchasing Agent designations or rescissions for all persons
                                who are capable of authorizing procurements, as prescribed
                                herein. The Fiscal Office will keep a record of all delegated
                                authorities and ensure that the appropriate staff is aware of such
                                delegations.

                             5. VEDP’s Procurement Office will provide and/or coordinate
                                training to Division Senior Vice Presidents and Vice Presidents,
                                managers, and Purchasing Agents as necessary to ensure
                                continued compliance with VEDP policies and adherence to
                                sound procurement practices.

                             6. VEDP’s Procurement Office will coordinate with the Fiscal
                                Office to ensure that payments for goods and services (or
                                credits due) are processed timely, and in accordance with all
                                VEDP policies and procedures.

                             7. VEDP’s Procurement Office will coordinate any inquiries,
                                reviews, or audits which may be requested and conducted from
                                time to time by the Board of Directors, or other State entities.

                             8. VEDP’s Procurement Office must be advised of, and will
                                coordinate, all vendor disputes, appeals and resolutions.




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2.2 VEDP Purchasing Agents (Divisions)

 POLICY:                     The Division Senior Vice Presidents and Vice Presidents will, with
                             the concurrence of the Controller, designate certain individual(s) in
                             each Division as being authorized Purchasing Agent(s). Such Agents
                             may be delegated the authority to procure items on behalf of their
                             Division (within designated limits), as long as they comply with all
                             VEDP purchasing policies and procedures.

 PROCEDURES:                 1. Each designated Purchasing Agent will review and understand
                                this Purchasing Policies and Procedures Manual and will
                                contact the Procurement Manager (see Section 2.1) with
                                questions, or if clarifications and samples are needed.

                             2. The Purchasing Agent shall coordinate all purchases made by
                                their division, obtaining additional authorizations as necessary,
                                and maintaining documentation as specified herein. No
                                purchases shall be made by any other division employee unless
                                specifically coordinated and authorized by their Purchasing
                                Agent.

                             3. The Purchasing Agent will review the division’s needs and
                                determine the possible sources and procurement methods
                                available to fulfill those needs (see Section 4). It is up to the
                                Agent, under the direction of the Procurement Office, to
                                evaluate and select which sources/methods should be evaluated
                                for a given purchase.

                             4. The Purchasing Agents may be issued a corporate purchasing
                                card to purchase items directly, within the limits and guidelines
                                established herein. The Agent shall be responsible for the
                                safekeeping of the card, ensuring it is used only for purchases
                                which are necessary to the operation and promotion of VEDP’s
                                business interests.

                             5. The Purchasing Agent will coordinate with their Division
                                Director and managers prior to any procurement to ensure that
                                adequate funding is available, and if any questions arise as to
                                the business need or appropriateness of the procurement.

                             6. The Purchasing Agent shall ensure that all goods and services
                                which were ordered are indeed received and acceptable prior to
                                authorizing or requesting payment.




Section 2: OVERVIEW OF VEDP PURCHASING                                                    7
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                             7. The Purchasing Agent will be responsible for producing and
                                maintaining certain procurement documentation, as prescribed
                                herein. Depending on the specific item and/or dollar amount,
                                this may require only the corporate card receipt, or could
                                require more extensive specifications, bids, purchase orders,
                                contracts and the like (See Section 3). All such documentation
                                shall be made available for review or retention as directed by
                                the Procurement Manager.




Section 2: OVERVIEW OF VEDP PURCHASING                                                  8
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2.3 VEDP Management Responsibility

 POLICY:                     Although VEDP has established a Procurement Office and Division
                             Purchasing Agents to facilitate the procurement process, Division
                             Senior Vice Presidents and Vice Presidents will have primary
                             responsibility for ensuring that all procurements are appropriate,
                             adequately funded, and in VEDP’s best interest.

 PROCEDURES:                 1. Division Senior Vice Presidents and Vice Presidents will
                                identify a capable individual within their division as a
                                designated Purchasing Agent. The Purchasing Agent will report
                                directly to the Division Director regarding all procurement
                                activity.

                             2. The Division Director will manage the division’s fiscal budget
                                and will notify their Purchasing Agent of funds allocated for
                                procurements, or changes thereto, during the course of the fiscal
                                year.

                             3. Division Senior Vice Presidents and Vice Presidents and/or
                                Cost Center Managers will be required to authorize certain
                                procurements which exceed the Purchasing Agent’s limits of
                                authorization, as defined herein, and/or assist the Purchasing
                                Agents to obtain additional authorizations as required for a
                                given procurement.

                             4. Division Senior Vice Presidents and Vice Presidents will be
                                responsible for ensuring that all division procurements are
                                coordinated through their Purchasing Agent (if one so
                                designated) or through the Procurement Office (if an Agent has
                                not been designated for the division).

                             5. Division Senior Vice Presidents and Vice Presidents and Cost
                                Center Managers are responsible for immediately notifying their
                                Purchasing Agent and/or the Procurement Office (depending on
                                the circumstances) if they identify or suspect that a violation of
                                VEDP’s procurement policies have occurred or are about to
                                occur.




Section 2: OVERVIEW OF VEDP PURCHASING                                                    9

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         SECTION 3: SPECIFIC RULES AND AUTHORIZATIONS

         VEDP Procurement Levels

           POLICY:                    VEDP’s standard procurement methods should first be evaluated by
                                      using the Procurement Levels Guide. This Guide is established by
                                      procurement value and delineates the authorized procurement
                                      method, authorized approver, documentation, and SWAM
                                      requirements.

                                      Certain international procurements are exempt from VEDP’s
                                      standard informal and formal bid processes. These international
                                      services are usually unique in nature and are only provided by a
                                      single or limited number of vendors. An example is consulting
                                      services provided in a foreign country, requiring specific foreign
                                      marketing expertise or a business presence in that country. When
                                      such procurement is made, the procurement method will be deemed
                                      an International Procurement and will be noted on the Accounting
                                      Transmittal Form (ATF) payment request and will include a Non-
                                      Compete Determination Form and other available supporting
                                      documentation.


           PROCEDURES:                Reference the following Procurement Levels Guide for the
                                      procurement of goods and services.




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                                                  VEDP Procurement Levels Guide
        If Total             Authorized                   Authorized           Payment Method/            Bid Requirement (SWAM
     Expenditure Is     Procurement Methods               Approver            ATF Documentation               Domestic Only) 1

    Under $10,000           State Contract or             Procurement         Corporate Purchasing        Procurement Manager will
    For goods or               eVA Portal                   Manager                  Card                 solicit SWAM vendors for
    non-professional                                                                                        office and technology
    services                 Vendor Quote             Division Purchasing   Purchase Order or Invoice              supply bids
                                                             Agent
    $10,000 to Under         State Contract                 SVP/VP            eVA Purchase Order                         --
         $50,000             Informal Bid                   SVP/VP            3 Bids and Purchase         Solicit a minimum of 3 bids,
      For goods or                                                             Order or Contract          to include 1 SWAM vendor,
    non-professional                                                                                                if available
        services          Emergency Purchase               SVP/VP           Emergency Determination                      --
                                                                            Form and Purchase Order
                                                                                   or Contract
                               Sole Source                 SVP/VP            Sole Source Justification                 --
                                                                            Form and Purchase Order
                                                                                   or Contract
                             Non-Compete                   SVP/VP            Non-Compete Form and
                                                                                Purchase Order or                      --
                                                                                    Contract
    $50,000 to Under         State Contract                SVP/VP             eVA Purchase Order                       --
        $100,000
                            Invitation for Bid             SVP/VP              3 Bids and Purchase        Solicit a minimum of 3 bids
                                                                                Order or Contract         to include 1 SWAM vendor,
                                                                                                                   if available
                          Request for Proposal             SVP/VP           3 Proposals and Purchase         Solicit a minimum of 3
                                                                                Order or Contract             proposals to include 1
                                                                                                          SWAM vendor, if available
                          Emergency Purchase               SVP/VP           Emergency Determination
                                                                            Form and Purchase Order                    --
                                                                                  or Contract
                               Sole Source                   CAO
                                                                            Sole Source Justification                  --
                             Non-Compete                     CAO            Form and Purchase Order
                                                                                  or Contract
                                                                            Non-Compete Form and                       --
                                                                               Purchase Order or
                                                                                   Contract
    $100,000 and Up          State Contract          President and CEO or     eVA Purchase Order                       --
                                                           Designee
                            Invitation for Bid       President and CEO or      4 Bids and Purchase        Solicit a minimum of 4 bids,
                                                           Designee             Order or Contract             to include 2 SWAM
                                                                                                              vendors, if available
                          Request for Proposal       President and CEO or   4 Proposals and Purchase        Solicit a minimum of 4
                                                           Designee             Order or Contract            proposals, to include 2
                                                                                                          SWAM vendors, if available

    $100,000 and Up       Emergency Purchase         President and CEO or                                              --
       (Cont’d)                                            Designee

1
 E-mail Procurement Manager for available SWAM vendors or search www.dbsd.virginia.gov. Additional guidance for vendor
searches is available from VEDP’s Procurement Office.
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                                                  VEDP Procurement Levels Guide
      If Total               Authorized                   Authorized           Payment Method/           Bid Requirement (SWAM
   Expenditure Is       Procurement Methods               Approver            ATF Documentation              Domestic Only) 1

                                                                            Emergency Determination
                               Sole Source           President and CEO or   Form and Purchase Order               --
                                                      Designee and CAO             or Contract
                                                                             Sole Source Justification
                             Non-Compete             President and CEO or   Form and Purchase Order               --
                                                      Designee and CAO             or Contract
                                                                             Non-Compete Form and
                                                                                Purchase Order or
                                                                                    Contract




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3.1 Advertising, Marketing and Promotional Items

 POLICY:                     Advertising, marketing and promotion are central to VEDP’s
                             mission. As such, goods and services procurements to support such
                             functions can vary widely, and are often obtained in combination
                             with specific projects, events, cooperative agreements, and/or joint
                             ventures. Obtaining advertising, marketing and promotional items is
                             often included as a line item in the divisional budgets, or as part of a
                             more comprehensive agreement, and is managed as such (also see
                             Sections 3.5 and 3.6).

                             VEDP intends to promote and utilize competition to its advantage,
                             and will strive to obtain bids for such goods and services through
                             alternative sources and methods wherever possible and practical. In
                             cases where advertising, marketing and promotional items can be
                             obtained directly (i.e., not as an integral part of a larger cooperative
                             agreement, event, or joint venture) standard procurement guidelines
                             will apply.

 PROCEDURES:                 Contact VEDP’s Communications & Promotions division for
                             VEDP’s branding guidelines for the procurement of advertising,
                             marketing, and promotional items.

                             Contact VEDP’s International Trade division for VEDP’s branding
                             guidelines for the procurement of international advertising,
                             marketing, and promotional items.

                             Reference the Procurement Levels Guide, Section 3, for the
                             procurement of goods and services.




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3.2 Air and Rail Tickets

 POLICY:                     Policies and procedures for arranging and purchasing airline and rail
                             tickets for business purposes by VEDP employees is described in the
                             VEDP Travel Policies and Procedures Manual. In some cases,
                             airline travel may be arranged by VEDP and “blocks” of tickets
                             purchased in combination with specific projects, events, cooperative
                             agreements, and/or joint ventures.

                             In all cases where multiple tickets are being purchased as a “block”,
                             the purchase must be authorized by the Division Director, who will
                             be responsible for ensuring the arrangements and total cost of the
                             tickets are reasonable, appropriate, and documented as part of the
                             overall cost of the specific project, event, cooperative agreement,
                             and/or joint venture. (Also see sections 3.5 and 3.6).

 PROCEDURES:                 Air and rail tickets may be purchased using the Agency Travel Card,
                             the Small Purchase Charge Card, or the Travel Charge Card issued
                             to individuals.




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3.3 Business Cards and Stationery

 POLICY:                     Business cards and stationery may be purchased and supplied to
                             employees, as necessary, to promote and support VEDP’s business
                             needs. In some cases (e.g., international trips) several business cards
                             may be appropriate, and significant lead time may be needed to write,
                             translate, proof, and print the materials.

                             While each division will be responsible for identifying their needs,
                             business cards and stationery orders are placed through the
                             Procurement Office. The Procurement Office coordinates artwork
                             with the Communications and Promotions division, and in
                             accordance with VEDP’s Graphic Marketing Standards. The
                             Procurement Office also ensures master business card stock is
                             available for orders as they are requested.

 PROCEDURES:                 Contact the Procurement Office with order request. Include quantity
                             (500 per box), an electronic markup of the new card information or
                             desired changes, and translation artwork for international cards.
                             Cards can usually be received within seven business days.




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3.4 Computer Hardware, Software and Related Services

 POLICY:                     Due to the technical nature and need to standardize where possible,
                             procurement of all computer hardware, software and related services
                             (such as delivery, installation, programming, testing, maintenance,
                             training and the like) will be conducted by VEDP’s Information
                             Technology (IT) division. This includes any personal computers or
                             software, modems, printers, cables, memory chips, ink/toner
                             cartridges, ribbons, cd’s, tapes, component upgrades, or other items
                             which are used within the Divisions, as well as items located and
                             operated centrally on behalf of the entire VEDP.

                             On-line services are considered computer-related, and as such will
                             be procured following the guidelines established in this section.

                             If a division identifies a need for computer hardware, software,
                             and/or related service they must contact the IT division. The IT
                             division will evaluate the need, identify the potential
                             products/sources, and select the appropriate procurement method.

                             Due to the highly technical nature of rapidly evolving information
                             technologies, VEDP recognizes the value of establishing ongoing
                             business relationships with vendors and manufacturers. As a result,
                             VEDP will seek to establish term contracts to provide consistent and
                             reliable sources of computer products and services.

 PROCEDURES:                 In addition to the expenditure authorizations in Section 3, the
                             Director of Information Technology must also authorize all
                             technology procurements regardless of expenditure level or
                             procurement method.

                             Reference the Procurement Levels Guide, Section 3, for the
                             procurement of goods and services.




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3.5 Conferences, Trade Shows, Sponsorships, and “Master Bills”

 POLICY:                     Expenditures related to conferences, trade shows, and “master bills”
                             will typically have two components: 1) the travel expenses incurred
                             as a result of VEDP employee participation; and 2) sponsorship of
                             various forums, exhibit space, and materials to be provided at the
                             event, and in some cases sponsoring VEDP prospects and guests.
                             Policies and procedures regarding travel expenses (item 1) are
                             provided in the VEDP Travel Policies and Procedures Manual. This
                             section covers all other procurements (item 2).

                             Conferences, trade shows, and sponsorships, by their very nature, are
                             unique. They typically cannot be compared directly with each other,
                             and the same event can seldom be obtained from “multiple vendor
                             sources”. VEDP sponsorship of conferences and trade shows is often
                             done in combination with cooperative agreements and/or joint
                             ventures.

                             Trade shows, conferences, and sponsorships may be exempt from
                             VEDP’s standard informal and formal bid processes. These
                             procurements are usually unique in nature and are only provided by
                             a single vendor. When such procurement is made, the procurement
                             method will be deemed a Sole Source procurement.

 PROCEDURES:                 Conferences, trade shows, and sponsorships are most often vendor
                             specific and not a competitively bid procurement. This type of
                             procurement may be deemed a Sole Source and requires a Sole
                             Source Determination Form, notation as a Sole Source on the
                             Accounting Transmittal Form (ATF) payment request, and other
                             available supporting documentation.

                             Contact VEDP’s Communications & Promotions and International
                             Trade divisions for VEDP guidelines for the procurement of
                             conference, trade show and sponsorship participation.

                             Reference the Procurement Levels Guide, Section 3, for the
                             procurement of goods and services.




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3.6 Cooperatives and Joint Ventures

 POLICY:                     VEDP will often work with commercial enterprises, private
                             organizations, or other public entities to advertise, market, and
                             promote business in the State. These arrangements, which are
                             referred to as cooperatives or joint ventures, require substantial
                             evaluation, planning, and negotiation before any VEDP funds are
                             committed or expenditures are made.


 PROCEDURES:                 VEDP management, and in particular The Division Senior Vice
                             Presidents and Vice Presidents and Cost Center Managers, should,
                             wherever appropriate, strive to introduce competition during the
                             evaluation, planning and negotiation process before entering into a
                             cooperative/joint venture agreement, as well as during the
                             procurement of goods and services to support the agreement (also
                             refer to sections 3.1 and 3.5).

                             All such cooperatives and joint ventures will be documented as a
                             multi-party written agreement, with specific line-item budgets
                             prepared and authorized in advance by the Division Director in all
                             cases. If VEDP expects to be reimbursed by any other party for
                             expenditures incurred by VEDP on behalf of the cooperative/joint
                             venture, the written agreement must include a schedule for all such
                             reimbursements. The agreement must be produced by the Division.
                             The original agreement must be forwarded to the Procurement
                             Office, with a copy maintained in the Division’s files.

                             If the budget for expenditures associated with the agreement is
                             $100,000 or greater, authorization is required from the President and
                             CEO or designee.




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3.7 Express Mail

 POLICY:                     Express mail should be utilized to mail materials which are
                             essential to “next day business”, and which could not be transmitted
                             electronically. Priority service (e.g., guaranteed delivery by 10:00
                             am) should only be used on an exceptional basis, since it is
                             significantly more expensive and may not necessarily arrive earlier
                             than standard overnight service. It is up to each manager to ensure
                             that such abuses do not occur in their area of responsibility.

                             VEDP utilizes the State contract for express deliveries, currently
                             with United Parcel Service (UPS).


 PROCEDURES:                 Shipment requests are created at the UPS website www.ups.com.
                             Each division has a separate account number for invoicing purposes
                             and the appropriate division account should be added and selected
                             when creating an online shipping request. Detailed contract
                             information is available at
                             http://dps.dgs.virginia.gov/dps/contracts/CovaContractDetail.aspx?
                             ContractNumber=91026-09.

                             Contact Information:
                             United Parcel Service (UPS)
                             8701 Park Central Dr., Suite 240
                             Richmond, VA 23227

                             Contact: Patty Fallin, Business Development
                             Local Phone No. (804) 261-3590
                             Virginia District Toll Free No. (888) 461-5046
                             Email: pcfallin@ups.com
                             Fax No. (804) 261-3523

                             Virginia Account Manager
                             Contact: Michael Kiefer Phone No. (804) 743-4301
                             Email: mkiefer@ups.com




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3.8 Maintenance Services

 POLICY:                     VEDP’s Procurement Office will be responsible for establishing all
                             contracts with providers of maintenance services, to include office
                             facilities/furniture, office equipment, State and VEDP-owned
                             vehicles, and other maintenance services as deemed necessary. In
                             the case of computer hardware/software, all maintenance contracts
                             will be authorized and managed by the Director of Information
                             Technology. No other maintenance contracts or services should be
                             established or ordered directly by any division or cost center.

                             Maintenance contracts may include scheduled/preventative
                             maintenance, fixed periodic fees for on-call repair services, or time-
                             and-materials rates for on-call repair services. Services may include
                             diagnostics, cleaning, refilling/supplying, scheduled upgrades,
                             “temporary loaners,” or “total replacements (swaps).”

                             In most cases, the purchase of items subject to maintenance will
                             include a warranty period, which should be evaluated prior to
                             purchasing the items and before establishing a contract for additional
                             maintenance periods and services. If such items are being procured,
                             the division purchasing agent or division manager must coordinate
                             with the Procurement Office to ensure warranty and maintenance
                             needs are properly analyzed.


 PROCEDURES:                 If maintenance (repair) is required, the Procurement Office should be
                             contacted before requesting or dispatching maintenance services. In
                             the case of computer hardware/software maintenance, Information
                             Technology should be contacted through a Help Desk request.




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3.9 Office Supplies, Furniture, Equipment (except Computers), and Other Goods

 POLICY:                     Other than those items otherwise addressed in Sections 3.1 through
                             3.13 of this manual, procurement of office supplies, furniture,
                             equipment (other than computers), printing and other goods will be
                             purchased in accordance with the rules established in this section.
                             For procurements involving both goods and services, it will be
                             considered a “goods” procurement if the estimated cost of goods is
                             more than 50% of the total purchase price.

                             In order to ensure the consistency and quality of all furnishings, the
                             Procurement Office will be responsible for procurement of all
                             furniture. If a division identifies a need for furniture and/or related
                             service, they must contact the Procurement Office. The Procurement
                             Office will evaluate the need, identify the potential products/sources,
                             and select the appropriate procurement method.

                             For purchases of (a) goods or nonprofessional services for $200,000
                             or more or (b) professional services or non-transportation-related
                             construction of $80,000 or more, VEDP shall post notice on the
                             Department of General Services’ central electronic procurement
                             website or VEDP’s website on the day of award or announcement of
                             decision to award such contract, whichever occurs first.

                             Procurement of any fixed assets requires special processing and
                             accounting by the Fiscal Office. If tangible products are being
                             ordered which are greater than $5,000 and have an expected “life”
                             greater than one year, contact the Procurement Office (see Section
                             5.3).

 PROCEDURES:                 Reference the Procurement Levels Guide, Section 3, for the
                             procurement of goods and services. In addition to the expenditure
                             authorizations in the Procurement Levels Guide, the Procurement
                             Office must also authorize all procurements of furniture, including
                             modular systems, regardless of expenditure level or procurement
                             method.




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3.10 Real Estate and Construction

 POLICY:                     VEDP’s Procurement Office will be responsible for establishing all
                             contracts for real estate or construction services. No other contracts
                             or services shall be established or ordered directly by any division or
                             cost center.

                             For purchases of (a) goods or nonprofessional services for $200,000
                             or more or (b) professional services or non-transportation-related
                             construction of $80,000 or more, VEDP shall post notice on the
                             Department of General Services’ central electronic procurement
                             website or VEDP’s website on the day of award or announcement of
                             decision to award such contract, whichever occurs first.




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3.11 Research Services

 POLICY:                     Research services are unique and typically cannot be compared
                             directly with each other. The same research can seldom be obtained
                             from “multiple vendor sources” and are often a sole source
                             procurement. VEDP’s needs for research services are often based on
                             specific marketing projects, and can be of a consulting nature, basic
                             research, or data services. Research services may be included as a
                             line item in the divisional budgets, or as part of a more
                             comprehensive agreement, and are managed as such.

 PROCEDURES:                 Seek guidance from your Division Vice President identifying the
                             need for a specific research service. The Research division may also
                             be a resource to prevent duplicate research service subscriptions.

                             Reference the Procurement Levels Guide, Section 3, for the
                             procurement of goods and services.




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3.12 Services (Professional and non-Professional)

 POLICY:                     Other than those items otherwise addressed in Sections 3.1 through
                             3.13 of this manual, procurement of services will be purchased in
                             accordance with the rules established in this section. For
                             procurements involving both goods and services, it will be
                             considered a “service” procurement if the estimated cost of labor is
                             more than 50% of the total purchase price. In addition to the
                             expenditure authorizations shown below, Human Resources must
                             authorize all staff augmentation (“temporary staff”) services
                             regardless of expenditure level or procurement method.

                             Professional services include work which must be performed by an
                             entity licensed in the practice of accounting, actuarial, architecture,
                             land survey, landscape architecture, law, medicine, optometry,
                             pharmacy or engineering. For procurements involving both goods
                             and services, it will be considered a "service” procurement if the
                             estimated cost of labor is more than 50% of the total purchase price.

                             All legal service needs will be referred to VEDP’s in-house counsel.

                             Soliciting professional services differs from other services, in that
                             costs or man-hour estimates should not be obtained during the initial
                             solicitation, and negotiations may be conducted with more than one
                             entity at the same time.

                             All other services are deemed non-professional and VEDP’s standard
                             procurement guidelines will apply.

                             For purchases of (a) goods or nonprofessional services for $200,000
                             or more or (b) professional services or non-transportation-related
                             construction of $80,000 or more, VEDP shall post notice on the
                             Department of General Services’ central electronic procurement
                             website or VEDP’s website on the day of award or announcement of
                             decision to award such contract, whichever occurs first.


 PROCEDURES:                 Reference the Procurement Levels Guide, Section 3, for the
                             procurement of goods and services.




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3.13 Telecommunications (Office Phones, Mobile Phones, Calling Cards, Voice Mail,
Data Lines)

 POLICY:                     Due to the technical nature and need to standardize where possible,
                             procurement of all telecommunications products and related services
                             (such as delivery, installation, programming, testing, maintenance,
                             training, local/long distance service, and the like) will be conducted
                             by the Information Technology division.

                             On-line services are considered computer-related, and as such will
                             be procured following the guidelines established in this section.

 PROCEDURES:                 If a division identifies a need for telecommunications equipment
                             and/or related service they must enter a Help Desk request to the
                             Information Technology division. They will evaluate the need,
                             identify the potential products/sources, and follow VEDP’s standard
                             procurement procedures for procurement of item(s).

                             Reference the Procurement Levels Guide in Section 3. In addition to
                             these expenditure authorizations, the Information Technology
                             Director must also authorize all technology procurements regardless
                             of expenditure level or procurement method.




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SECTION 4: STANDARD PROCUREMENT AND PAYMENT METHODS

4.1 Electronic Procurement – eVA

 POLICY:                     VEDP utilizes eVA as the procurement method for Procurement
                             Office and technology supplies and equipment, and other products
                             that can be obtained in a cost effective, timely and efficient manner.

 PROCEDURES:                 1. VEDP utilizes eVA to research State-registered vendors and
                                products and services, solicit bids and proposals, and create
                                requisitions and purchase orders. VEDP’s Procurement
                                Manager and some division purchasing agents are registered
                                eVA users, but for the most part, all eVA orders are generated
                                from the Procurement Office.

                             2. VEDP Divisions will follow current procurement policies when
                                purchasing goods and services through eVA. For example,
                                office supplies and information systems hardware/software
                                procurements will be centralized through VEDP’s Procurement
                                Manager. Other products and services not available through an
                                eVA vendor may be purchased at the Division level on a case-
                                by-case basis.

                             3. To comply with Virginia’s efforts to increase small, women-
                                owned and minority business procurements, VEDP has
                                implemented the following procedures for Procurement Office
                                and technology equipment and supplies, and other types of
                                procurements as applicable:

                                  •   When products or services are needed, the Division will
                                      contact the Procurement Office by e-mail with their product
                                      or service needs. Item numbers should be provided if
                                      known.
                                  •   The Procurement Manager will obtain pricing from the
                                      State’s office supply contract vendors through the eVA
                                      procurement system to include pricing from available
                                      SWAM vendors.
                                  •   The Procurement Manager will notify the requestor of
                                      product availability and delivery date and, if acceptable,
                                      place the order.
                                  •   Once the products are received, the requestor will forward
                                      packing slips and invoices to the Procurement Manager for
                                      payment processing, and all invoices and costs will be

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                               charged to the ordering Division.

                       4. The Procurement Manager will certify monthly eVA purchases
                          through the eVA Dashboard by the 5th day of the following
                          month.
                       5. VEDP follows eVA’s security guidelines, including designating
                          a Security Officer to maintain user information and perform
                          annual certification of users. The Procurement Manager
                          approves all eVA purchases and delegates approval authority
                          during the Procurement Manager’s absences. VEDP currently
                          utilizes eVA as a purchase order tool and efficient use of State
                          contracts. No eVA interfacing with other systems is currently
                          active. If eVA is unavailable, purchases will be made by
                          approving written quotes or verbal phone orders.




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4.2 Corporate Purchasing Cards

 POLICY:                             VEDP is a political subdivision participant of the
                                     Commonwealth’s Bank of America VISA purchasing
                                     charge card program, which enables streamlined procedures
                                     for procuring and paying for small dollar goods and services.
                                     The purchasing card program reduces the volume of
                                     accounts payable transactions and the associated
                                     administrative costs by eliminating vendor invoices and
                                     consolidating multiple vendor payments into one monthly
                                     payment to the charge card vendor. Suppliers are paid
                                     directly by the purchasing card contractor, currently Bank of
                                     America VISA. In addition, the purchasing card contractor
                                     provides a variety of management information reports to
                                     assist in maintaining control over purchases and payments
                                     via Works, Bank of America’s online program management
                                     system.

                                     While the use of a purchasing card leads to accounting
                                     efficiencies, VEDP maintains strict internal control over the
                                     use of cards and ensures that relevant procurement
                                     guidelines are observed. The purchasing card should be
                                     viewed at all times as an efficient means of payment, not a
                                     substitute for VEDP’s procurement guidelines and
                                     procedures.

 Roles                               The Program Administrator and Back-up Program
                                     Administrator are registered with Bank of America as the
                                     only persons authorized to make changes (e.g., add or cancel
                                     cards, change card controls, etc.) for the purchase card at the
                                     corporate account level. The Program Administrator and
                                     Back-up Program Administrator are designated by VEDP’s
                                     Controller.

 Card Issuance                       Purchasing cards are issued to only those individuals who
                                     have appropriate purchasing authority. When requesting a
                                     card for an employee, the applicant’s supervisor must
                                     provide the Program Administrator with documentation
                                     supporting the issuance of the card, including an analysis of
                                     the potential type and level of activity and justification for
                                     per transaction and monthly limits. The employee will
                                     complete a Purchasing Card Request form and submit it to
                                     their supervisor for signature.           VEDP’s Program

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                              Administrator will apply for purchase cards directly online
                              using the Bank of America Works system.

                              Cards are issued with the name of the cardholder and the
                              cardholder's organization name embossed on the front.
                              Cardholders must receive training and sign a Purchasing
                              Card Employee Agreement form prior to obtaining the
                              purchasing card.

 Purchase Limits              The Program Administrator sets the limits on each
                              purchasing card to appropriate levels based on the
                              cardholder’s buying needs and card usage. Written
                              authorization from the cardholder’s supervisor is required
                              for all limit settings and changes. A cardholder may not,
                              under any circumstances, authorize any charge in excess of
                              the transaction limit set by the Program Administrator.
                              Violation of this policy could result in the loss of charge
                              privileges for a minimum of three months or permanently.
                              The Program Administrator maintains documentation on
                              justification for all limit changes.

                              Temporary purchase limits may be requested for a one-time
                              or unusual charge (in these circumstances, a return date to
                              the cardholder’s original purchase limits is entered in
                              Works).

                              The cycle limit designates the total amount a cardholder can
                              spend during the monthly billing cycle. This is typically
                              referred to as the cycle or credit limit. A running balance is
                              maintained in Bank of America’s database that increases
                              with each authorized charge until the cardholder reaches the
                              assigned cycle limit. If the limit is reached before the end of
                              the billing cycle, new attempts for authorization are denied.

                              The single transaction limit designates the maximum dollar
                              amount allowed for cardholders to spend on each purchase
                              or transaction. At the point-of-sale, Bank of America’s
                              system verifies the purchase amount falls within the
                              approved transaction limit. If the amount requested for
                              authorization exceeds the limit set by the Program
                              Administrator, the authorization is denied. If a cardholder
                              authorizes a charge in excess of the per transaction limit
                              established for that card, whether by splitting the invoice,
                              encouraging the vendor to circumvent the Bank of America
                              denial, or any other means, this may result in the suspension

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                              of card privileges for a minimum of three months.
                              Therefore, cardholders shall be mindful of transaction and
                              monthly limits prior to making purchases on the purchasing
                              card.

                              Program Administrators are permitted to obtain a purchasing
                              card. However, they are not allowed to perform maintenance
                              on their own card. Requests for limit increases, restriction
                              removals, and other such changes, must be completed by the
                              backup Program Administrator.


 Purchase Card Use            Purchasing cards may be issued to full or part-time
                              employees, but not to contract workers.

                              Purchasing cards must be used for official VEDP purchases
                              only and all purchases must comply with VEDP’s
                              Procurement Policy.

                              Use of the purchasing card for personal items or cash
                              advances is prohibited.

                              If a cardholder authorizes a charge in excess of the per
                              transaction limit established for that card, whether by
                              splitting the invoice, encouraging the vendor to circumvent
                              the Bank of America denial, or any other means, the card
                              may be suspended for a minimum of three months.

                              The purchase of airline tickets, mass transit tickets, car
                              rentals on the State Car Rental Contract and
                              accommodations is permissible for VEDP employees. The
                              purchasing cardholder should       never present their
                              purchasing card at check-in for their own travel
                              arrangements.

                              The purchasing card may be used to reserve/pay for blocks
                              of rooms for VEDP-sponsored meetings or to make a deposit
                              on a traveling employee reservation. Once the traveling
                              employee checks in, the accommodation charges must be
                              made on the traveler’s personal or corporate travel card and
                              submitted as an expense reimbursement to the Fiscal Office.

                              A traveler who has a purchasing card cannot use their own
                              purchasing card to check in or check out at a hotel, unless


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                              the traveler is making a VEDP-sponsored group reservation
                              and the purchase cardholder is part of the group.

                              Note that some new airline travel regulations require that
                              passengers who purchase electronic tickets with a charge
                              card must produce the card at check-in. It is recommended
                              that verification be performed with the airline of choice to
                              determine the airline’s practices.
 Gift Card/Certificate        Purchase of gift cards and/or gift certificates using the
 Purchases                    purchasing card is permissible for employee recognition and
                              for speaker appreciations, attendance awards, or raffle
                              awards at VEDP-sponsored events. Since gift cards and gift
                              certificates are in essence cash, and generally do not have
                              the employee’s name on them, they pose a very high risk for
                              possible abuse. Therefore, each card/certificate must
                              contain a unique number for tracking purposes and a log
                              must be maintained itemizing each card’s unique number,
                              card value, and recipient name.

 Cardholder,           All new cardholders, supervisors, reviewers, and approvers
 Supervisor, Reviewer, will receive purchase card training. Additional refresher
 and Approver Training training and card program updates will be provided as
                       needed by the Program Administrator.

 Purchase Card Security Authorized use of the purchasing card is limited to the
                        person whose name appears on the face of the card. The
                        purchasing card or its number must not be shared with
                        another person who is not a vendor with whom they are
                        conducting business. A cardholder must not share their card
                        number with another person or the named cardholder’s
                        privileges may be suspended.

                              All cardholders are prohibited from sending the account
                              number via email (even if it is included in an attachment),
                              faxing the account number, mailing card information, or
                              sharing card information with anyone to make a purchase.
                              The purchasing card must be maintained in an accessible but
                              secure location.

                              If the purchasing card is lost or stolen, the cardholder must
                              immediately notify Bank of America and VEDP’s Program
                              Administrator.

                              Bank of America Cardholder Customer Service
                              Toll Free #: 888-449-2273

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                              Collect #: 509-353-6656 outside the U.S.

                              VEDP’s terminated employee checklists require that
                              terminated employees must turn in all purchase cards and
                              contact the Program Administrator in a timely manner.
 Billing Options              Enterprise Rental Car offers a direct bill option, which
                              allows travelers who are renting an Enterprise Rental Car
                              through the State contract in Virginia to check in without the
                              need for a credit card. Contact Enterprise at 804-358-2388
                              to get the needed information to set up a purchasing card
                              account to be charged for Enterprise charges.

 Enhanced Management Cardholders have access to Works’ Payment Center to
 Features            access their monthly statement.
                     https://www.centresuite.com/Centre/Public/Logon/.
                     All cardholders are required to register their card in Works’
                     Payment Center for access to their charges online. This will
                     facilitate a timely reconciliation due to the cardholder’s
                     ability to check their charges at any time during the month.

 Purchase Logs                Each cardholder is required to maintain a monthly Purchase
                              Log and must update it as each purchase is made so spending
                              limits can be monitored and purchasing activity can be
                              reconciled to the monthly charge card statement. A
                              Purchasing Log Excel template is available from VEDP’s
                              Program Administrator.

 Charge Card Statement VEDP’s Fiscal Office is responsible for processing
 Payment Procedures    payments to Bank of America no later than the 7th of each
                       month. Cardholder monthly log data is uploaded into
                       VEDP’s accounting system and a check is processed for the
                       total monthly amount due to Bank of America.

                              Reconciled statements are reviewed and approved in writing
                              by the cardholder’s supervisor or reviewer, then reconciled
                              with the corresponding Bank of America VISA Card
                              statement prior to receipt of the next Bank of America VISA
                              Card statement.

                              Original payment processing documents are maintained in
                              VEDP’s accounts payable file for audit purposes.

                              Supporting documentation is maintained by the Program
                              Administrator regarding limit changes for audit purposes.


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 Program Administrator Daily:
 Responsibilities      • Entering cardholder data, reviewing, and approving
                           card applications;
                       • Setting appropriate transaction and credit limits on each
                           card based on the cardholder’s buying needs;
                       • Issuing cards;
                       • Ensuring that Virginia Sales tax has not been charged
                           on purchases;
                       • Ensuring that if a card ordered is not received in 7
                           business days, it is cancelled for security reasons, and
                           requesting a new one to protect against possible mail
                           theft.

                              Monthly:
                              • Monitoring on a regular basis the transactional data for
                                 the purchasing card to ensure compliance to policy (e.g.,
                                 split orders, VEDP’s procurement policy).

                              Annually:
                               • Ensuring that an annual analysis of each cardholder’s
                                  card usage and card limits is performed and
                                  documented;
                               • Monitoring and canceling inactive cards;
                               • Educating cardholders in proper card usage, security,
                                  and procurement guidelines;
                               • Performing an annual audit of the WORKS system to
                                  identify and confirm that each users’ WORKS system
                                  access is still appropriate and required and deleting all
                                  identified unnecessary user profiles immediately.

                              As Needed:
                              • Promptly canceling cards as appropriate;
                              • Ensuring agency and cardholder compliance with all
                                 purchasing card policies and procedures presented in
                                 this policy, including proper processing of monthly
                                 payments;
                              • Promptly notifying Bank of America of any potential or
                                 confirmed fraudulent use of the purchasing card and
                                 steps that are being taken to address the issue (e.g., card
                                 cancellation, communication with the vendor and/or
                                 Bank of America, notification of law enforcement
                                 officials as appropriate);
                              • Managing vendor issues pertaining to not receiving
                                 ordered goods/services or incorrect charges.             If
                                 resolution cannot be made at the Program Administrator

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                                  level, notify Bank of America, providing the necessary
                                  information referenced on the monthly bill.

 PROCEDURES:           1. Cardholder orders approved product or service directly from
                          participating suppliers.

                       2. Supplier processes order.

                       3. Corporate card company automatically checks for compliance
                          with applicable card limits.

                       4. Supplier delivers product or service; Cardholder verifies all
                          items received.

                       5. Cardholder enters the transaction onto the Corporate Purchasing
                          Card Log and includes expenditure coding and receipts.

                       6. Corporate card company arranges payment to supplier in as few
                          as three business days.

                       7. Cardholders receive a monthly statement to verify purchases.

                       8. Cardholder verifies the corporate card statement, provides
                          signature authorization on Corporate Purchasing Card Log and
                          forwards to Procurement Office for payment processing.

                       9. VEDP’s Procurement Office reviews consolidated bill,
                          compares to Corporate Purchasing Card Log and forwards to
                          the Fiscal Office for payment.




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4.3 State Contracts

 POLICY:                     VEDP utilizes State contracts when goods or services can be readily
                             obtained through a contract in a cost effective, timely, and efficient
                             manner. Available contracts may be researched at
                             www.eva.virginia.gov.

                             1. Check with the Procurement Office to determine if the desired
 PROCEDURES:                    item is on a State contract.

                             2. If the item is not on State Contract, refer to the appropriate
                                purchasing section and Procurement Levels Guide. If the item
                                is found to be on State Contract and is cost-competitive, request
                                that the Procurement Manager order from the State Contract
                                through eVA.

                             3. An eVA purchase order is electronically forwarded to the
                                vendor.

                             4. When the order arrives, match the packing ticket to the purchase
                                order. Notify vendor immediately if there are any
                                discrepancies.

                             5. When the invoice arrives, match the invoice to the packing
                                ticket and purchase order. Notify vendor immediately if there
                                are any discrepancies.

                             6. Prepare an Accounting Transmittal Form (ATF), providing all
                                expenditure coding information, and attach invoice, packing
                                slip, and copy of purchase order.

                             7. Forward receipt to Procurement Manager for eVA orders placed
                                on the Procurement Manager’s corporate purchasing card.

                             8. Forward the ATF and attachments to the Fiscal Office for
                                payment processing.

                             9. ATF’s $10,000 or greater are reviewed by the Procurement
                                Office for proper procurement method and documentation
                                before payment is generated.




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4.4 Emergency Purchases

 POLICY:                     To be considered an emergency for purchasing reasons, a situation
                             must exist which is likely to:

                             •    Endanger life or property
                             •    Cause injury to any person or property
                             •    Cause cessation of essential services, operations, or functions of
                                  VEDP
                             •    Cause financial loss or risk of loss to VEDP
                             •    Cause non-performance of any duty or obligation of VEDP
                                  imposed by law or contract
                             •    Any other event which may be detrimental to VEDP and its
                                  programs and policies.

                             VEDP shall not be required to seek competition or engage in
                             competitive negotiation if it determines in writing that an
                             emergency exists and makes the purchase needed with such
                             competition as is practicable under the circumstances. VEDP shall
                             state in such writing 1. That the contract is being awarded on an
                             emergency basis, 2 that which is being purchased, 3 the contractor
                             selected for such purchase, 4 the date of the award of such contract,
                             and 5 the relationship of such purchase to the public purpose and
                             mission of VEDP. Such notice shall be posted on the Department
                             of General Services’ central electronic procurement website or
                             VEDP’s website on the day VEDP awards or announces its
                             decision to awards or announces its decision to award such contract,
                             whichever occurs first.

                             Emergency purchases require justification and authorization by a
                             Division SVP or VP ($10,000 to under $50,000), the CAO ($50,000
                             to under $100,000) or the President and CEO and CAO ($100,000
                             and above). (See Section 3.) Authorization of an Emergency
                             Purchase indicates that in management’s judgment, the benefits of
                             an immediate and direct purchase of goods or services outweigh the
                             drawbacks of limited competition.

 PROCEDURES:                 1. If an emergency purchase is deemed necessary, complete the
                                Emergency Determination form (for purchases $10,000 and
                                above), and obtain required authorizing signatures. If the
                                emergency is likely to endanger life or property, cause injury to
                                any person or property, or cause cessation of essential services,
                                operations, or functions of VEDP, the Emergency
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                           Determination form may be completed after the fact.

                       2. If practical, competition should be solicited through informal
                          bids or otherwise before issuing a purchase order. If
                          competition is not practical, utilize the most direct and least
                          time-consuming method to procure the goods or services.
                          Typically this will be issuance of a purchase order or contract.

                       3. Depending on the method of procurement selected in step two,
                          all subsequent steps in the applicable process should be
                          completed (See sections 4.1 through 4.10). Declaring an
                          Emergency Purchase does not relieve the purchaser from
                          completing all necessary procurement documentation or
                          obtaining necessary authorization signatures.

                       4. Refer to VEDP’s Continuity of Operations Plan (COOP) for
                          emergency purchasing procedures during a COOP event.




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4.5 Sole Source

 POLICY:                     A purchase of goods or services may be considered sole source if
                             there is only one source practicably available. A contract may be
                             negotiated and awarded to that source without competitive
                             negotiation. VEDP’s Sole Source Form documents the basis for this
                             determination. VEDP shall issue a written notice stating that only
                             one source was determined to be practicably available and
                             identifying that which is procured, the contractor selected, and the
                             date on which the contract was or will be awarded. This notice shall
                             be posted on the Department of General Services’ central electronic
                             procurement website or VEDP’s website on the day VEDP awards
                             or announces its decision to award such contract, whichever occurs
                             first.

                             Note: Sole source must not be confused with proprietary purchases,
                             the latter being one where only a specific brand, make or model is
                             acceptable, but it can be obtained from several sources (e.g., dealers,
                             resellers, distributors).

                             Sole source purchases require justification and authorization by a
                             Division Director ($10,000 to under $50,000) or the Controller
                             ($50,000 to under $100,000) or the President and CEO ($100,000
                             and above). (See Section 3.) Authorization of a sole source indicates
                             that in management’s judgment no other viable sources are
                             practicably available who can supply the required good or service in
                             a timely manner.

                             Sole source documentation will not be required for any procurement
                             that, in the normal course of business, would ordinarily not be
                             competitively bid, such as postal replenishment; marketing and trade
                             shows and conventions (which are held at specific locations out of
                             VEDP’s control and not subject to alternatives); sales, marketing
                             and advertising sponsorships (which by their very nature are sole
                             source because they are associated with specific shows, events, or
                             advertorial programs with specific providers of those programs and
                             cannot be completed otherwise).

                             VEDP shall post notice on its website on the day of award or
                             announcement of decision to award such contract, whichever occurs
                             first.



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 PROCEDURES:           1. If a sole source is deemed necessary, complete the Sole Source
                          Justification form (for purchases $10,000 and above), and
                          request an eVA order from the Procurement Office.

                       2. The purchase order is forwarded to the vendor.

                       3. When the order arrives, match the packing ticket to the purchase
                          order. Notify vendor immediately if there are any
                          discrepancies.

                       4. When the invoice arrives, match the invoice to the packing
                          ticket and purchase order. Notify vendor immediately if there
                          are any discrepancies.

                       5. Prepare an Accounting Transmittal Form (ATF), providing all
                          expenditure coding information, and attach Sole Source
                          Justification form, invoice, packing slip, and copy of purchase
                          order, or forward receipt to Procurement Manager for eVA
                          orders placed on the Procurement Manager’s corporate
                          purchasing card.

                       6. Forward the ATF and attachments to the Fiscal Office for
                          payment processing.

                       7. ATF’s $10,000 or greater are reviewed by the Procurement
                          Office for proper procurement method and documentation
                          before payment is generated.




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4.6 Non-Compete Determination

 POLICY:                     A purchase of goods or services may be considered Non-Compete if
                             there is only one source practicably available.

                             Note: Non-Compete must not be confused with proprietary
                             purchases, the latter being one where only a specific brand, make or
                             model is acceptable, but it can be obtained from several sources
                             (e.g., dealers, resellers, distributors).

                             Authorization of a Non-Competitive Award indicates that in
                             management’s judgment, no other viable sources are practicably
                             available to supply the required good or service in a timely manner.

                             Non-Compete purchases require justification and authorization by a
                             Division Director ($10,000 to under $50,000) or the Controller
                             ($50,000 to under $100,000) or the President and CEO ($100,000
                             and above). (See Section 3).

                             Non-Compete procurements may include marketing and trade shows
                             and conventions (which are held at specific locations out of VEDP’s
                             control and not subject to alternatives); sales, marketing and
                             advertising sponsorships (which by their very nature are non-
                             competitive because they are associated with specific shows, events,
                             or advertorial programs with specific providers of those programs
                             and cannot be completed otherwise).

 PROCEDURES:                 8. If a Non-Compete determination is deemed necessary, complete
                                the Non-Compete Determination form (for purchases $10,000
                                and above), and request an eVA order from the Procurement
                                Office.

                             9. The purchase order is forwarded to the vendor.

                             10. When the order arrives, match the packing ticket to the purchase
                                 order. Notify vendor immediately if there are any
                                 discrepancies.

                             11. When the invoice arrives, match the invoice to the packing
                                 ticket and purchase order. Notify vendor immediately if there
                                 are any discrepancies.



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                       12. Prepare an Accounting Transmittal Form (ATF), providing all
                           expenditure coding information, and attach Non-Compete
                           Determination form, invoice, packing slip, and copy of purchase
                           order, or forward receipt to Procurement Manager for eVA
                           orders placed on the Procurement Manager’s corporate
                           purchasing card.

                       13. Forward the ATF and attachments to the Fiscal Office for
                           payment processing.

                       14. ATF’s $10,000 or greater are reviewed by the Procurement
                           Office for proper procurement method and documentation
                           before payment is generated.




4.7 Proprietary Products

 POLICY:               Proprietary purchases involve goods where only specific brands,
                       makes or models are acceptable, but they can be obtained from
                       several sources (e.g., dealers, resellers, distributors). Rarely do
                       proprietary purchases involve services. If only one source is
                       available, it is considered a Sole Source Purchase (see Section 4.5).

                       VEDP will strive to define its needs in a non-proprietary fashion,
                       where multiple brands, makes and models can be considered.
                       However, in the case where only one is practicable (e.g., computer
                       software upgrades), VEDP may specify manufacturer, make and
                       model.

                       By definition, some level of competition is available for procuring
                       proprietary products, and VEDP will strive to utilize such
                       competition to its advantage when procuring proprietary products.

 PROCEDURES:           1. If a proprietary product is deemed necessary, clearly and
                          completely document the specifications for all potential
                          suppliers. Contact the Procurement Office for approval.

                       2. Competition should be solicited through informal bids, formal
                          bids, RFP’s or otherwise before issuing a Purchase Order. The
                          procurement levels, methods, and authorizations outlined in
                          Section 3 define the appropriate methods and authorizations.



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                       3. Depending on the method of procurement selected in step 2, all
                          subsequent steps in the applicable process should be completed
                          (See sections 4.1 through 4.10). Declaring a proprietary
                          product does not relieve the purchaser from completing all
                          necessary procurement documentation or obtaining necessary
                          authorization signatures.




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4.8 Informal Bids (Authorized for purchases up to and under $50,000)

 POLICY:                     Informal bids, which include “Telephone Quotations” and “Written
                             Quotes” are an efficient method for introducing limited competition
                             into the procurement process. They are typically used when the
                             goods or services are readily definable, and the total expenditure
                             level is relatively low. They are likely the quickest way to obtain
                             goods and services competitively but cannot be utilized in every case
                             (See Section 3 to determine when/if informal bids are allowed).

 PROCEDURES:                 1. Define the goods or services in sufficient detail to be able to
                                communicate the need verbally or in brief written form to
                                potential suppliers. If specifications are too detailed or complex
                                to be communicated verbally or on a few written pages, it is
                                likely that a more formal process should be followed (See
                                Sections 4.8 and 4.9).

                             2. Forward the specifications, either verbally, by e-mail, by
                                facsimile, or by mail, to at least three (3) potential suppliers, to
                                include one SWAM vendor. Provide all suppliers a reasonable
                                and identical period of time (e.g., by C.O.B Friday) to provide a
                                verbal or written quote. A Bid Sheet is available on VEDP’s
                                Intranet site.

                             3. Document the supplier quotes. Additional information provided
                                by the suppliers (if any) should be attached. This includes
                                determining if the bid will indeed fulfill the specifications and if
                                the vendor is reasonably capable of delivering (“responsive and
                                responsible”).

                             4.    Award will be made to the lowest-cost, responsive and
                                  responsible bidder. The other bidders may be notified, but
                                  public “bid openings” are not required.

                             5. A purchase order may be requested from the Procurement
                                Office.

                             6. Purchase order is forwarded to vendor.

                             7. When the order arrives, match the packing ticket to the purchase
                                order. Notify vendor immediately if there are any
                                discrepancies.


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                       8. When the invoice arrives, match the invoice to the packing
                          ticket and purchase order. Notify vendor immediately if there
                          are any discrepancies.

                       9. Prepare an Accounting Transmittal Form (ATF), providing all
                          expenditure coding information, and attach bid documentation,
                          invoice, packing slip, and copy of purchase order.

                       10. Forward the ATF and attachments to the Fiscal Office for
                           payment processing.

                       11. ATF’s $10,000 or greater are reviewed by the Procurement
                           Office for proper procurement method and documentation
                           before payment is generated.




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4.9 Formal Bids - $50,000 and above (IFB's and Sealed Bids)

 POLICY:                     Formal bids also referred to as “Invitations For Bid” (IFB) and
                             “Sealed Bids” are used to introduce open competition into the
                             procurement process. Specifications (or Scope of Work) form the
                             backbone of good formal bid procurements. Specifications must be:

                             •    Sufficiently complete to ensure VEDP’s needs are adequately
                                  met.
                             •    Broad enough to ensure competition.
                             •    Drawn to reflect VEDP’s procurement needs rather than favor a
                                  particular vendor.

                             If specifications or scope of work cannot be written to: (i) completely
                             define the needs; (ii) permit open competition; or (iii) if quality and
                             concept factors outweigh price factors, the competitive negotiation
                             procurement method should be used (see Section 4.9).

 PROCEDURES:                 1. Define the goods or services in sufficient detail to be able to
                                communicate the need in written form (IFB) to potential
                                suppliers. The IFB shall include a copy of VEDP’s standard
                                General Terms and Conditions for multi-party contracts.

                             2. Forward the IFB to at least three potential suppliers to include
                                one small, woman owned, and/or minority owned (SWAM)
                                potential supplier, when available, for contract values between
                                $50,000 and under $100,000; and to four potential suppliers to
                                include two SWAM potential suppliers, when available, for
                                contract values $100,000 and higher, and advertise as prudent
                                and applicable (see Section 5.5). Contact the Procurement
                                Office for assistance in identifying potential suppliers. Provide
                                all suppliers a reasonable and identical period of time (e.g., by
                                C.O.B July 15) to provide a written quote.

                             3. Optionally, the Procurement Manager is available to assist with
                                scheduling and conducting a bidder’s conference for all
                                interested suppliers if the bid is unusually large and/or complex.

                             4. Any changes or clarifications which are identified subsequent to
                                issuance of the IFB must be made in writing and forwarded to
                                all interested suppliers.



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                       5. Receive the vendor responses, and begin the evaluation process.
                          This includes determining if the bid will indeed fulfill the
                          specifications and if the vendor is reasonably capable of
                          delivering (“responsive and responsible”). Vendor references
                          may also be requested and contacted.

                       6. Award will be made to the lowest-cost, responsive and
                          responsible bidder. The other bidders may be notified, but
                          public “bid openings” are not required.

                       7. A purchase order or contract may be requested from the
                          Procurement Office. Forward the purchase order /contract to
                          vendor. For contracts, obtain vendor’s counter-signature.

                       8. When the order arrives or services are received, match the
                          packing ticket or other documentation to the purchase order or
                          contract. Notify vendor immediately if there are any
                          discrepancies.

                       9. When the invoice arrives, match the invoice to the packing
                          ticket and purchasing order or contract. Notify vendor
                          immediately if there are any discrepancies.

                       10. Prepare an Accounting Transmittal Form (ATF), providing all
                           expenditure coding information, and attach invoice, packing
                           slip, and copy of purchase order.

                       11. Forward the ATF and attachments to the Fiscal Office for
                           payment processing.

                       12. ATF’s $10,000 or greater are reviewed by the Procurement
                           Office for proper procurement method and documentation
                           before payment is generated.




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4.10 Competitive Negotiations - Request for Proposals (RFP)

 POLICY:                     If specifications or scope of work cannot be written to: (i) completely
                             define the needs; (ii) permit open competition; or (iii) if quality and
                             concept factors outweigh price factors, the competitive negotiation
                             procurement method should be used to procure needed goods and
                             services. While written specifications must be developed, additional
                             discussions, clarifications, and negotiations are usually expected as a
                             result of RFP's.

 PROCEDURES:                 1. Requests for Proposal are created, distributed, and awarded
                                from the Procurement Office. Division staff shall provide the
                                Procurement Manager with defined goods or services in
                                sufficient detail to be able to communicate the need in written
                                form (RFP) to potential suppliers. The RFP should include a
                                copy of VEDP’s standard General Terms and Conditions for
                                multi-party contracts.

                             2. Forward the RFP to as at least three potential suppliers to
                                include one small, woman owned, and/or minority owned
                                (SWAM) potential suppliers, when available, for contract
                                values between $50,000 and under $100,000; and four potential
                                supplies to include two SWAM potential suppliers, when
                                available, for contract values $100,000 and higher, and
                                advertise as prudent and applicable (see Section 5.5). Contact
                                the Procurement Office for assistance in identifying potential
                                suppliers. Provide all suppliers a reasonable and identical
                                period of time (e.g., by C.O.B July 15) to provide a written
                                response.

                             3. Optionally, schedule and conduct a proposal conference for all
                                interested suppliers if the RFP is unusually large and/or
                                complex.

                             4. Any changes or clarifications which are identified subsequent to
                                issuance of the RFP must be made in writing and forwarded to
                                all interested suppliers.

                             5. Prior to receiving proposals, the criteria to be used to evaluate
                                the responses and select a vendor must be agreed to by the
                                procurement selection team (committee), and published by the
                                Procurement Office. Typically this will involve specific
                                categories, weighted to reflect the selection team’s priorities,

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                           such as; (i) proposed solution/approach for meeting VEDP’s
                           needs; (ii) qualifications of vendor/staff; (iii) plan and schedule;
                           (iv) prior experience and references; and (v) cost.

                       6. Receive the vendor responses and begin the evaluation process.
                          This includes analyzing vendor proposals relative to the
                          published evaluation/award criteria. Award will not necessarily
                          be made to the lowest-cost, responsive and responsible bidder.
                          Negotiation of price is allowed and should be considered along
                          with more qualitative criteria. The other bidders may be
                          notified, but public “bid openings” are not required.

                       7. The Procurement Office will complete a purchase order or
                          contract for the selected vendor and obtain required authorizing
                          signatures.

                       8. The purchase order/contract is forwarded to vendor. For
                          contracts, obtain vendor’s counter-signature.

                       9. When the order arrives or services are received, match the
                          packing ticket or other documentation to the purchase order or
                          contract. Notify vendor immediately if there are any
                          discrepancies.

                       10. When the invoice arrives, match the invoice to the packing
                           ticket and purchase order or contract. Notify vendor
                           immediately if there are any discrepancies.

                       11. Prepare an Accounting Transmittal Form (ATF), providing all
                           expenditure coding information, and attach invoice, packing
                           ticket, and copy of purchase order.

                       12. Forward the ATF and attachments to the Fiscal Office for
                           payment processing.

                       13. ATF’s $10,000 and greater are reviewed by the Procurement
                           Office for proper procurement method and documentation
                           before payment is generated.




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4.11 Contracts

 POLICY:                     A multi-party contract (typically two party – vendor and VEDP) may
                             be established for procurements, usually as a result of an informal or
                             formal bid process.

                             The contract will include VEDP’s General Terms and Conditions,
                             and will include all specifications, RFP's/IFB’s, vendor proposals
                             and the like, when appropriate. The actual expenditure of funds
                             against the contract will be authorized by the issuance of purchase
                             order(s) and related vendor invoices, and a properly authorized
                             Accounting Transmittal Form.

 PROCEDURES:                 1. Contact the Procurement Office before entering into a contract.

                             2. If the Procurement Office determines a contract will be
                                required, assistance will be provided to ensure the solicitation
                                documents and procurement process provides the necessary
                                information
                                and steps.

                             3. Order splitting is prohibited. Order splitting is the placement of
                                multiple orders within other than a reasonable time period to one
                                or more vendors for the same, like, or related goods and services
                                to avoid using the appropriate method of procurement or to
                                remain within the delegated purchasing authority. Order splitting
                                results in higher administrative costs and is a highly inefficient
                                practice. Requirements should be combined when practical to
                                obtain quantity discounts and other administrative efficiencies.




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SECTION 5: INTERNAL CONTROLS AND RECORD KEEPING

5.1 Budgetary Controls

 POLICY:                  Budgetary control is essential to VEDP’s procurement process. All
                          divisions and cost centers must prepare and submit a budget request
                          each fiscal year which includes, among other items, the projected
                          expenditure levels for procurement of goods and services. The
                          operating plan should further define major procurements that are to
                          be obtained during the course of the year. The operating plan will be
                          approved by the President and CEO and the VEDP Board.

                          Before any division or cost center processes an order for goods and
                          services, management must ensure that proper funds are available
                          (based on the available budget) to support the payment for such
                          items.     Currently, VEDP accounting records reflect the
                          “expenditure” of those funds once the items are received, to ensure
                          subsequent purchases do not result in an over-expenditure of the
                          budget.

 PROCEDURES:              1. The Division Senior Vice Presidents and Vice Presidents, Cost
                             Center Managers, and Purchasing Agents should participate in
                             the preparation of the overall division budget, and submit to the
                             Fiscal Office for review, revision, approval and potential
                             amendment during the year.

                          2. The Fiscal Office will establish the approved budget in VEDP’s
                             financial systems, and will produce monthly reports showing
                             the budget, less expenditures (payments), and remaining
                             (unexpended) funds.

                          3. Before authorizing any purchase, the responsible person
                             (depending on the expenditure level and procurement method,
                             see Section 3) must ensure that budget funds are available.

                          4. If funds are available, and all other purchasing procedures have
                             been complied with, the procurement may be authorized and
                             forwarded to the supplier. This results in the “encumbrance” of
                             division funds, although the current VEDP systems do not track
                             the encumbrance. The divisions/Purchasing Agents are
                             responsible for tracking the order and the associated
                             “encumbrance” until received.



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                           Once the goods/services are received, and the associated invoice is
                           processed for payment by the Fiscal Office, the subsequent monthly
                           expenditure and budget reports will reflect a decrease in level of
                           remaining (unexpended) funds.




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5.2 Procurement Documentation

 POLICY:                  Producing and maintaining adequate documentation of all
                          purchasing activity is another essential element of internal controls
                          within VEDP. The documentation prescribed by this manual will be
                          maintained in all instances. Sections 3 and 4 specify the
                          documentation to be produced, depending on the type of goods or
                          services being procured, level of the expenditure, and the
                          procurement method utilized.

 PROCEDURES:              The divisions will be responsible for developing, organizing and
                          submitting the majority of such documentation. Unless specified
                          otherwise, the original of all key procurement documents will be
                          forwarded to the Procurement Office (Fiscal Office for ATF's and
                          Invoices), as prescribed herein (see Section 4). The original copies
                          of such documentation will be retained by the Procurement Office
                          for an appropriate period of time.




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5.3 Expenditure Coding

 POLICY:                  All VEDP purchasing transactions will be coded to ensure the
                          appropriate division and cost center budgets are reduced accordingly.


 PROCEDURES:              Division management shall designate the applicable expenditure
                          code for the purchase, which indicates the type of goods or services
                          being acquired.

                          The Fiscal Office shall maintain the list of all valid division and cost
                          center codes and expenditure codes, and provide copies of such lists
                          to all division Purchasing Agents. Each Division Purchasing Agent
                          will be responsible for assigning the appropriate code from the
                          standard code tables, and entering them on the applicable Accounting
                          Transmittal Forms and corporate card logs.

                          The Procurement Office will ensure that any purchases of Fixed
                          Assets are identified, and the Fiscal Office will record the transaction
                          on VEDP’s financial records. A Fixed Asset is defined as:

                          A tangible or intangible item with a cost of $5,000 or more and a life
                          expectancy of more than one (1) year. All costs directly related to the
                          acquisition of a fixed asset (i.e., freight, installation) should be
                          included in the computation of the total costs.
      .




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5.4 Receipt of Goods and Services

 POLICY:                  The procurement process does not end when the purchase order or
                          contract is issued. The division that purchases any goods or services
                          is responsible for ensuring that such goods and services are received
                          in a timely manner and in good order, relative to the procurement
                          specifications and contracts.

                          In addition, the receipt of goods will be acknowledged by both the
                          individual who originally authorized the purchase, as well as a
                          division Purchasing Agent or manager who is independent of the
                          original procurement decision.

                          Finally, payment for all items ordered and received will be done by
                          the Fiscal Office only, based, in part, on their receipt of all necessary
                          procurement documentation and authorizing signatures.

 PROCEDURES:              1. The receiving division will inspect all goods and services
                             immediately upon delivery, and compare them to the
                             procurement specifications.

                          2. If discrepancies are found, notify the supplier immediately and
                             describe the problem in detail.

                          3. If the discrepancy goes uncorrected for five (5) days, again
                             notify the vendor, this time in writing, attaching any
                             specifications or other documentation which clarifies the
                             problem, and copy the Procurement Office on the
                             correspondence. This notification is an “informal notification
                             of discrepancy”, which should be so stated in the
                             correspondence.

                          4. If the receipt of goods and services is not corrected by the above
                             steps within ten (10) business days, notify the Procurement
                             Office (a total of fifteen (15) business days after initial receipt).
                             The Procurement Office is responsible for all subsequent
                             actions, including processing of potential vendor appeals,
                             disputes, resolutions, and defaults.

                          5. Once all goods and services are received in good order, the
                             Accounting Transmittal Form (ATF) will be completed. This
                             includes obtaining signatures from the individual who originally


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                               authorized the procurement (Purchasing Agent or VEDP
                               management), as well as the signature of someone independent
                               of the original decision (Purchasing Agent or VEDP manager).
                               The latter should be the individual who actually receives and
                               inspects the delivered items, and enters the receiving
                               information on the ATF.




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5.5 Vendor Invoices, Payments, and Lease Purchases

 POLICY:                   VEDP will only issue payments to vendors if:

                           •   Goods or services are received in accordance with the
                               procurement specifications (see Section 5.5).
                           •   Expenditure coding and authorizations are evident (see Sections
                               3 and 5.3)
                           •   Appropriate documentation is available (see Sections 3 and 4).

                           If the above criteria are met, VEDP’s Fiscal Office will process the
                           transaction, and the vendor will receive payment in accordance with
                           VEDP’s payment policy.

                           If no terms have been negotiated but the vendor invoice specifies
                           terms, VEDP may, in its sole discretion, accept such terms if they are
                           favorable to VEDP, or otherwise elect to pay on a “Net 30” basis.

                           VEDP shall promptly pay for the completely delivered goods or
                           services by the required payment date. Partial payments will be
                           allowed only if the receipt of the partial shipment/delivery can be
                           confirmed, and if the vendor invoice reflects the partial
                           shipment/delivery (i.e., the vendor should invoice only the amount
                           delivered, with subsequent shipments/delivery being invoiced
                           separately).

                           Any items which VEDP intends to acquire through a lease
                           arrangement, regardless of expenditure level or procurement
                           method, must be approved by the Controller prior to issuing a
                           purchase order or contract.

                           All Sales and Use Taxes will be the responsibility of the vendor. If
                           an exemption is requested, only the Procurement Office is allowed to
                           issue a Sales and Use Tax, Certificate of Exemption.

 PROCEDURES:               1. When the order arrives (or services are delivered), match the
                              packing ticket or other materials to the purchase order and/or
                              contract, if applicable. Notify vendor immediately if there are
                              any discrepancies.

                           2. When the invoice arrives, match the invoice to the packing
                              ticket, purchase order, and/or contract. Notify vendor
                              immediately if there are any discrepancies.


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                           3. Prepare an Accounting Transmittal Form (ATF), providing all
                              expenditure coding information, and attach invoice, packing
                              slip, and copy of purchase order.

                           4. Forward the ATF and attachments to the Fiscal Office for
                              payment processing.

                           5. ATF’s $10,000 or greater are reviewed by the Procurement
                              Office for proper procurement method and documentation
                              before payment is generated.




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5.6 Audit Reviews

 POLICY:                   VEDP’s purchasing process will be subject to audit and other
                           reviews, as directed by the following:

                           •   VEDP Fiscal Office
                           •   VEDP Board of Directors
                           •   Auditor of Public Accounts
                           •   State Attorney General’s Office
                           •   Legislative Boards and Commissions

                           The basis for such reviews will be VEDP’s Purchasing Policies and
                           Procedures, as approved by the VEDP Board and as documented
                           herein. All audits or other such reviews will be coordinated by the
                           Procurement Office and the Controller.

 PROCEDURES:               The participation in such audits or reviews by other members of
                           VEDP management and staff, and the release of materials to support
                           those audits/reviews, must be coordinated and authorized by the
                           Controller.




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5.7 Freedom of Information Act

 POLICY:                   Under the Freedom Of Information Act (FOIA), information relating
                           to the procurement of goods and services which are funded, in whole
                           or in part, by public moneys is available for inspection by the public.
                           The latter includes any citizen or interested person, firm, corporation,
                           research organization, or other public entity.

                           While VEDP will fully comply with valid FOIA requests, certain
                           information is exempt from disclosure. This typically includes
                           proprietary information, trade secrets, and the like submitted by
                           vendors as part of their bids/proposals.

 PROCEDURES:               If a request for information relating to any previous or ongoing
                           VEDP procurement is made under the FOIA or otherwise, the request
                           should be immediately referred to the Controller and VEDP’s
                           counsel.




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SECTION 6: OTHER CONSIDERATIONS

6.1 Preferred Vendors

 POLICY:                     All VEDP procurements will provide qualified vendors reasonable
                             access to participate in the process, and no vendor will be arbitrarily
                             or capriciously excluded or discriminated against.

                             Notwithstanding the foregoing, public procurement policy in general
                             and VEDP’s policy in particular allows for reasonable preferences to
                             be included in the bid specifications and selection criteria which
                             favor:

                             •    Small, women-owned, and minority businesses.
                             •    Products or services produced in Virginia.
                             •    Products which utilize recycled goods or “less toxic”
                                  manufacturing methods.

                             Regarding the first preference, VEDP does not have a “set aside”
                             program for participation of small, women-owned, and minority-
                             owned business. However, VEDP’s Procurement Office encourages
                             participation of such businesses by obtaining lists of firms from the
                             Department of Minority Business Enterprise and other sources;
                             referring to the list as procurement needs are identified; and actively
                             soliciting the participation of such firms in applicable procurements.

 PROCEDURES:                 Contact the Procurement Office for available and preferred vendors
                             for your particular procurement.




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6.2 Debarred Vendors

 POLICY:                     An individual or firm may be debarred (not allowed to do business
                             with VEDP) for any of the following reasons:

                             •    Breach (default) of contract.
                             •    Stating an unwillingness or inability to honor a binding bid.
                             •    Falsifying or misrepresenting their abilities relative to the
                                  procurement specifications and bids in order to appear
                                  responsive.
                             •    Conferring or offering to confer upon any VEDP employee
                                  participating in a procurement (which the entity has bid on or
                                  intends to submit a bid) any gift, gratuity, favor, or advantage,
                                  present or future.
                             •    Any cause indicating the entity is not a responsible vendor.
                             •    A determination by VEDP’s President and CEO that the entity
                                  has used abusive language, threats, or other conduct deemed
                                  unprofessional or inappropriate during the conduct of business.
                             •    Conviction of any criminal offense, antitrust law violations, or
                                  convictions indicating lack of moral or business integrity (in
                                  which cases debarment may be for three years).

                             The President and CEO or designee will make the final determination
                             as to debarment, and will notify the Purchase Office, who will
                             maintain a list of such debarred vendors. Vendors debarred by other
                             State entities will also be considered debarred from doing business
                             with VEDP.




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6.3 Vendor Insurance, Performance Bonds, Bid Bonds

 POLICY:                     Vendors providing services to VEDP are required to maintain the
                             insurance coverage noted below. VEDP may waive this requirement
                             on a case-by-case basis.

                             •    Workers Compensation: Statutory requirements and benefits.
                             •    Employer’s Liability: $100,000
                             •    Commercial General Liability: $500,000 combined single unit,
                                  with VEDP named as an additional insured with respect to the
                                  services being provided.     This coverage is to include
                                  Premise/Operations liability, Products and Completed
                                  Operations Coverage, Independent Contractor’s Liability,
                                  Owner’s and Contractor’s Protective Liability, and Personal
                                  Injury Liability.
                             •    Automobile Liability: $500,000.

                             If a contract for goods or services is expected to exceed $50,000 in
                             total annual expenditures, the Controller must determine if a bid
                             and/or performance bond will be requested prior to issuing the
                             solicitation documents, and if such bonds will be maintained once
                             the bids/proposals are received.




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6.4 Vendor Performance Monitoring

 POLICY:                     The procurement process does not end when the purchase order or
                             contract is issued. Monitoring vendor performance is a critical part
                             of the process, to ensure the proposed goods or services are delivered
                             in a timely manner, in accordance with the bid/proposal
                             specifications, and without substitution or partial completion (unless
                             previously approved).

                             A contract administrator may be assigned to monitor the contract.
                             This person may or may not be the individual who performed the
                             procurement function, but must keep that person informed of any
                             problems or potential problems regarding any contract or purchase
                             order so action may be taken before such problems become critical.

                             Regardless of expenditure level, if a vendor fails to deliver as
                             specified or fails to deliver in a timely manner, the vendor should be
                             notified immediately, and given a reasonable period of time to cure
                             the failure (“cure period”). This is usually five (5) days after the first
                             verbal notice, and an additional ten (10) days after written notice is
                             provided.

                             If the failure persists after a reasonable cure period is allowed
                             (usually 15 days), the Procurement Office must be notified so that
                             additional actions can be initiated as appropriate (see Section 6.5).




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6.5 Vendor Appeals, Disputes, and Remedies

 POLICY:                     All actions taken to respond to a vendor appeal or dispute, or any
                             action initiated by VEDP to deny withdrawal of a binding bid or to
                             terminate a vendor contract for non-performance, must be
                             coordinated by VEDP’s Procurement Office, regardless of the goods
                             or services being procured, the expenditure level, or the procurement
                             method utilized. This is to help ensure that VEDP does not expose
                             itself to unwarranted liability or misperceptions regarding its
                             procurement policies and procedures.

                             VEDP will provide an “internal administrative appeals procedure”
                             for resolution of the dispute, but has not established any independent
                             administrative appeals process, such as binding arbitration.

                             If a vendor appeal has been filed (verbally or in writing), it should be
                             immediately forwarded to the Procurement Office. Similarly, if a
                             vendor has failed to perform in accordance with the contract
                             specifications and such failure has not been corrected after a
                             reasonable “cure period” (see Section 6.4), the Procurement Office
                             must be notified immediately.

                             In any case, the appeal/dispute process will be coordinated by the
                             Procurement Office, with final decisions being made by the President
                             and CEO or Designee.

 PROCEDURES:                 1. If a vendor appeal has been filed (verbally or in writing)
                                regarding its delivery of goods or services to VEDP or its
                                failure to receive an award of business (i.e., non-selection as a
                                result of a VEDP procurement process), it should be
                                immediately referred to the Procurement Office.

                             2. Similarly, if VEDP believes a vendor has attempted to withdraw
                                a binding quotation or failed to perform in accordance with the
                                procurement/contract specifications, and such failure has not
                                been corrected after a reasonable “cure period” (see Section
                                6.4), the Procurement Office should be notified immediately.

                             3. In either case (1 or 2 above), the appeal/dispute process will be
                                conducted by the Procurement Office, which will work with the
                                vendor to assemble and review all facts and circumstances, and
                                will present them to the Controller within 10 days after
                                notification is received/issued.



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                             4. The Controller will review the facts and circumstances as
                                presented, and will issue a written decision to the vendor within
                                10 days after receiving all facts.

                             5. If the vendor is not satisfied with the decision, they have 10
                                days to request a review by VEDP’s President and CEO. If the
                                President and CEO or Designee agrees to review the decision,
                                they must do so and issue their written decision to the vendor
                                within 10 days after receiving the request.




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6.6 Surplus/Unclaimed Property

 POLICY:                     Property no longer needed by VEDP is to be considered surplus
                             property. The Controller will make such determination, and the
                             Facilities Manager will coordinate the transfer or disposal of such
                             items.

                             Nothing in this policy shall be construed to mean that VEDP, at its
                             sole discretion, may not amend its policies, or choose on a case by
                             case basis to dispose of surplus property as it deems necessary and in
                             the best interest of VEDP and the Commonwealth.




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