This procedure sets forth guidelines to assist state-operated State University of New York (University) campuses in establishing contracts under which the university provides consideration other than money (Revenue Contracts).  It outlines procedures necessary to enter into valid, binding Revenue Contracts on behalf of the University, describes the steps appropriate for internal and external review, where required,  and identifies those officers authorized to execute Revenue Contracts and other documents on behalf of the University.  

Questions regarding this procedure should be directed to your campus counsel.

1. General Considerations
   
   
   1. A Revenue Contract involves the University giving consideration, other than the payment of money, e.g., where the University receives money for goods, services rendered, or use of SUNY assets.
      
      
   2. Agreements involving the University giving consideration other than the payment of money, or receiving money, include repayment agreements, barter agreements, and revocable permits.
      
      
   3. Similar to procurements involving the expenditure of funds, University should maintain a procurement record documenting the decisions made and the approaches taken in selecting the contractor.
      
      
   4. All revenue contracts shall be executed by an authorized campus officer.
      
      
2. Solicitation Process
   
   
   1. While State Finance Law does not expressly require a formal competitive bidding process, it is a best practice to seek competition.  Conducting a formal competition demonstrates that an award is fair, reasonable, and in the best interest of the University.
      
      
   2. The solicitation process should begin with a clear statement of need, a description of the required specifications governing performance and related factors, a reasonable process for ensuring a competitive field, a fair and equal opportunity for offerors to submit responsive offers, and a balanced and fair method of award.
      
      
   3. In instances where the campus determines that competition is appropriate, the following process should be considered by the campus:
   1. The campus:
   1. should attempt to solicit three (3) responses, when practicable, by placing an advertisement describing the contracting opportunity in:
      1. the New York State Contract Reporter (NYSCR);
      2. appropriate local publications (if applicable); and
      3. notifying vendors, if known, who may have the interest and ability to enter into such a contract;
   2. establish scoring criteria for determining the offer is in the best interests and meets the needs of the University and New York State; and,
   3. identify person(s) qualified to independently evaluate offers received.

   Using the pre-determined scoring criteria and revenue offer in each response, determine the offer that best meets the needs of the University and New York State.

   4. In instances where the campus determines that competition is not practicable or feasible, the campus should document why the agreement is justified as non-competitive.  
      Include in the procurement record:
   1. the material and substantive reasons:
   1. why competition is not practicable or feasible;
   2. why the specific vendor was selected;
   2. the alternatives considered; and
   3. the reasonableness of the expected revenue.
      
      
3. Vendor Selection
   
   
   1. State agencies use the Statewide Financial System (SFS) Customer Contracts Module to record these types of State contracts (including repayment agreements) and amendments thereto and to submit such transactions to OSC for approval. NYS OSC Guide to Financial Operations (See sections 7A through 7C for more information).
      
      
   2. The contracting party must be registered in the Statewide Vendor File and have a valid Vendor ID. In addition, they must be registered in the New York State Customer File and assigned a Customer ID. It is the responsibility of the University to initiate the registration process for all Vendors/Customers they do business with, who are not already registered in the New York State Vendor and/or the New York State Customer File.
      
      
4. Revenue Contract Requirements
   
   
   1. SUNY Exhibit A must be incorporated and attached to all Revenue Contracts.
      
      
   2. Prior to submission for vendor signature, send contract to campus counsel for review as to form.
      
      
   3. NYS Vendor Responsibility Questionnaire: VRQ must be filed for Revenue contracts exceeding $100K. However, campus may require the counterparty to fill out a NYS VRQ for all revenue contracts, regardless of estimated dollar amount.
      
      
5. Oversight Approval
   
   
   1. Revenue contracts, including repayment agreements and other types of revenue contracts (e.g., barter agreements) where the consideration given by the University does not involve the transfer of money, but the reasonable value of such consideration over the entire term of the agreement exceeds $25,000, require prior approval by the NYS Office of the Attorney General (OAG) and the Office of the State Comptroller (OSC) in order to be a valid, enforceable contract.
      
      
   2. In circumstances where the consideration flowing from the University cannot be readily determined in terms of current market value, value must be determined in terms of intrinsic value, by measuring an asset¿s value based on qualities in addition to its useful purpose. Tangible and intangible factors are considered to arrive at intrinsic value, which may or may not be the same as the current market value.
      
      
   3. Approval by OSC of revenue contracts, including barter agreements, requires that the University demonstrate a reasonable process has been followed to secure fair and reasonable contract terms. Typically, that process should involve competition to the maximum extent possible.
      
      
   4. Where OAG and OSC approval is required, services should not commence or any obligations under a contract assumed until approval is received.  
   
   
6. Accounting of Receipts
   
   
   1. The University must establish internal control and accounting procedures to ensure revenue receipts are properly accounted for and reported in the SFS.

There are no forms relevant to this procedure.

Purchasing and Contracting - Procurement

New York OSC Guide to Financial Operations Section XI.7 Revenue and Repayment Agreements

8 NYCRR 316

NY State Finance Law § 112(3) 

There is no history relevant to this procedure.

There are no appendices relevant to this procedure.