Consulting Services Acquisition and Use Policy

Consulting Services Acquisition and Use Policy

Abstract:
This policy provides guidelines to UAB departments and units for acquiring consulting services and for monitoring the use of those consulting services.
Effective Date:
10/13/1998
Contacts:
None Assigned
Administrative Category:
Applies To:
Faculty, Staff
Material Original Source:

University of Alabama at Birmingham

CONSULTING SERVICES ACQUISITION AND USE POLICY

October 13, 1998

See also the following related documents:
  • UAB policy entitled "Execution and Review of Contracts for the University of Alabama at Birmingham"
  • UAB "Purchasing Policies and Guidelines"
  • UAB "Personal Services Approval and Payment Policy"
  • "Consulting Within UAB" in theUAB Faculty Handbook and Policies
  • "Internal Consulting" in the You & UAB Handbook for Faculty and Staff
  • UAB Health System Interdisciplinary Standard entitled "Obtaining and Monitoring Consulting Services"
  • Signature authority resolutions of the University of Alabama Board of Trustees
    Board of Trustees Rule 415 "Planning and Management of Facilities and Other Capital Assets"

Introduction

This policy provides guidelines to UAB departments and units for acquiring consulting services and for monitoring the use of those consulting services.

For purposes of this policy, "consulting services" are defined as work or tasks performed by independent contractors (individuals or businesses) who possess specialized knowledge, experience, expertise, and professional qualifications to investigate assigned problems or projects and to provide counsel, review, analysis, or advice in formulating or implementing improvements in programs or services. This includes, but is not limited to, the organization, planning, directing, control, evaluation, operation, and quality assurance of a program, center, department, or unit.

This policy does not apply to UAB employees (including faculty) who engage in consulting under the UAB or school consulting policies unless those employees are providing consulting services to UAB. The following are examples of services to which this policy does not apply: guest lecturers and speakers, health-care providers, legal services, or attestation services of certified public accountants.

This policy does not apply to consulting services which are defined, and specifically budgeted for, in a grant or contract for sponsored research, instruction, or other sponsored activity.

Any services by the Certified Public Accountant appointed by the Board of Trustees to conduct the University's audits must be approved by the General Auditor. Consulting services acquired as part of the following types of acquisitions must be approved by the Board of Trustees (see Board Rule 415): (1) facility construction, renovation, addition, and demolition equal to, or greater than, $750,000 and (2) individual pieces of equipment or computer software equal to, or greater than, $500,000.

Policy Statement

Consultants may be used at UAB only if there is a need for services which cannot be provided by UAB employees (1) due to lack of relevant expertise such as cases in which information from a firm with national/regional expertise is important (for example, in the development of standards to comply with federal regulations) or (2) because UAB employees are unable to perform the services in a timely manner. Requests for approval to use consulting services must ensure that the consulting services are necessary.

In many cases, requests for approval to use consulting services may require two review and approval processes: the first for initial approval to consider use of consulting services for solving a problem as indicated in the preceding paragraph and the second for approval to use a specific consultant or consulting service at a specific dollar amount. It is recognized that the specific monetary amount required for the consulting service acquisition may not be known at the time that the initial request to use consultants is made. Procedures of the specific UAB area will dictate whether, and at what levels, a review is required for the initial proposal to use consulting services before a specific dollar amount has been established.

Requests for approval of the monetary amount, the specific contractual arrangements, etc. for a consulting services acquisition must ensure that the fee is reasonable, that an objective method of selecting the recommended specific consultant or consulting firm has been followed, and that the request for sole source acquisition, if included, is justified. UAB officials or department/unit heads requesting acquisition of consulting services must be able to show the process they followed for determining the need for consulting services and for determining their recommendation of the specific consultant or consulting firm being requested.

Pre-authorization for Consulting Services Equal To, or Greater Than, $50,000:

Requests for consulting services equal to, or exceeding, an anticipated fee of $50,000 must be submitted for review and approval by the appropriate vice president/Provost/Director of the UAB Health System prior to soliciting proposals for services. If the anticipated fee did not equal, or exceed, $50,000 but the actual quoted fee does, the proposal to acquire the consulting services must then be submitted for review and approval by the appropriate vice president/Provost/Director of the UAB Health System prior to final submission for signature approval.

Justification for Consulting Services Equal To, or Greater Than, $50,000:

Justification for acquisition of consulting services which are equal to, or exceed, a fee of $50,000 must extend beyond the basic request and justification for consulting services. In addition to ensuring that the consulting services are necessary, that the fee is reasonable, and that the request for sole source acquisition, if included, is documented, a final request for acquisition of consulting services exceeding the threshold indicated above also must include a description of the specific, objective method used to select the recommended consultant or consulting firm.

Additional Conditions Relative to Consulting Service Acquisitions:

Documentation for Sole Source Acquisition of Consulting Services Equal To, or Greater Than, $25,000: Requests for sole source acquisition of consulting services which equal, or exceed, a fee of $25,000 must be documented, and the documentation must contain reasons for selection of the vendor being recommended. The sole source documentation and reasons for selection of the vendor should be included in the materials attached to the contract/agreement checklist required for contract/agreement approval.

Materials and Equipment Included in Consulting Services Contracts or Agreements: If the consulting service contract/agreement includes procurement of materials or equipment, the contract must be bid if the total amount of the materials or equipment exceeds the limits established for bidding UAB purchases.

All contracts or agreements for consulting services must be signed and executed in accordance with the UAB policy entitled "Execution and Review of Contracts for the University of Alabama at Birmingham." That policy and the Board of Trustees signature authority resolutions specify the only UAB officials who may legally sign a contract or agreement for UAB.

All contracts or agreements for consulting services at UAB must include at least the following:

  • The purpose of the consulting arrangement and the anticipated benefit to UAB or to the department/unit requesting the use of consulting services
  • Measurable anticipated outcomes during the period covered by the contract or agreement
  • The relationship of requests for payment or renewals to successful completion by the consultant(s) of measurable anticipated outcomes or milestones
  • Method(s) of requesting payment for services including the types of detail required (for example, documented hours worked if compensation is based on an hourly rate)
  • Method(s) of requesting payment for out-of-pocket expenses and the documentation required (for example, specific receipts documenting travel, lodging, meals, etc.)
  • Written report(s) to be provided by the consultant(s) to the department/unit requesting consulting services as part of milestone completions or as a final report at the end of the contract or agreement. If the nature of the consulting services is such that written reports are not appropriate to the situation, verbal reports will be allowed. Whenever practicable, this should be specified in the contract/agreement for the consulting services.

Any variance from these required components of a consulting services contract/agreement must be justified in writing in the proposal to use consulting services, and such justification must be approved as part of the contract/agreement approval process by the UAB official authorized to sign the consulting services contract/agreement.

The UAB official or the appropriate department/unit head receiving a consultant's report must be able to show how the department or unit implemented, or responded to, the findings of the consulting services report(s). Such UAB official or department/unit head also must be able to provide an evaluation of the performance of, and the continued need for, a consultant's services.

Retention of Consulting Services Documents

The original of all fully executed contracts or agreements for consulting services must be forwarded to the University Contracts Office. It is the responsibility of the originating department/unit head to ensure that this occurs. A copy of the contract/agreement for consulting services and all reports by the consultant(s) should be retained by the originating department/unit.

Consultant reports and descriptions of responses or implementations by the department/unit must be readily available for review and inspection by appropriate UAB officials and by the Office of Internal Audit - UAB. (See also the UAB policy entitled "Execution and Review of Contracts for the University of Alabama at Birmingham" for information concerning retention of original contracts/agreements and the accompanying contract/agreement approval checklists.) Based on record retention requirements of the State of Alabama, consultant reports must be retained for at least seven years after the terms of the document have been fulfilled. (See Schedule EG-2-5-4 of the State Records Commission "Alabama University General Records Schedules.") Note that these are minimum time periods for which these documents must be retained by the department/unit; administrative or programmatic needs may dictate longer periods of retention for some contracts/agreements and the accompanying reports. Any questions concerning longer retention periods should be directed to the University Contracts Office or to the appropriate vice president/Provost/Director of the UAB Health System.

Implementation

The Vice President for Financial Affairs and Administration is responsible for procedures to implement this policy. Included in such procedures must be the ability to account for consulting services expenditures in such a manner that UAB management officials are able to monitor the financial aspects of using consultants at UAB.

Additional consulting services acquisition and use policies may be created by major UAB units. Those policies may be more restrictive than this UAB-wide policy but may not be less restrictive.