FINANCIAL MANAGEMENT
This chapter examines the financial management functions of the Water Valley Independent School District (WVISD) in six subsections:
- A. Fiscal Operations
- B. Budget
- C. Risk Management
- D. Cash and Investments
- E. Fixed Assets
- F. Purchasing
F. PURCHASING
An efficient purchasing function should ensure that a district purchases supplies, equipment and services vital to its educational mission from appropriate sources, in the correct quantity, at the lowest prices and in accordance with federal, state and local laws and policies.
In 1995, the Texas Education Code (TEC) was revised to include changes in state purchasing regulations designed to provide the best value to school districts through a competitive bidding process. Generally, when a district purchases items valued at $25,000 or more in aggregate (or multiple like items with a cumulative value of more than $25,000 in a twelve-month period), it must follow one of the following competitive bid processes:
- Competitive sealed proposals: vendors submit a written bid, and the district opens all submitted bids publicly to ensure fairness in the bidding process;
- Requests for proposals: vendors submit a written bid, and the district opens submitted bids as they come in;
- Purchases from the state catalogue: vendors that have completed competitive bid requirements at the state level and can sell products directly to districts;
- Procurements through an interlocal contract: board-approved agreements with a local entity that allows the district to purchase specific items from that entity's bid; or
- Design/build contracts: a district selects a vendor through a competitive bid to complete an entire project; it is the vendor's responsibility to obtain merchandise for the project.
In 1999, the Office of the Attorney General issued an opinion (Op. JC-37) stating that school district procurement through an interlocal agreement or a cooperative purchasing arrangement satisfies competitive bidding requirements.
School districts must advertise bids worth more than $25,000, at least once a week, for two weeks in any newspaper published in the county in which the district is located. Districts must advertise bids worth between $10,000 and $25,000 in two successive issues of any newspaper in the district's county. The TEC requires advertisements to specify the categories of property to be purchased and to solicit vendors that are interested in supplying them.
WVISD does not have a great deal of storage capacity available. For this reason, it is unable to participate in the Region 15 purchasing cooperative. Region 15 orders supplies in bulk that WVISD does not have room to store. Therefore, the district keeps a limited amount of office supplies on hand and uses a garage to store the majority of these supplies. The elementary school and the high school also store a small amount of supplies.
The review team determined that the district's bid process is in compliance with state regulations. WVISD places an advertisement in the San Angelo Standard Times for the items that must be bid each year, including propane and fuel. The Food Services manager handles all food services purchases, and the district bids out all large quantities of food items.
FINDING
The purchasing process at WVISD is relatively simple. When an item is required, a requisition order is completed and the Business manager is contacted to ensure that there is money available in the budget for the purchase. Once the budget has been verified, a purchase order is created. The superintendent then reviews the purchase order and verifies it against the budget again. If the superintendent determines that the purchase is justified and sufficient funds exist, the order is processed. If sufficient funds do not exist or if the superintendent determines that the purchase is not acceptable, the request is denied. The majority of all staff members interviewed felt that the purchasing process at WVISD was effective and that the turnaround time was relatively short.
COMMENDATION
The district ensures that all purchases are verified against the budget and completed in a timely fashion.
FINDING
WVISD provides each teacher with $100 per year to use for classroom supplies. The teachers must fill out purchase requisitions for the expenditures but have some discretion to purchase items that will best enhance their individual classrooms. The supply allowance provides the teachers with a small degree of freedom in their classrooms. Many use this money for incentive items to reward their students for certain achievements. In focus groups, each teacher commented on the value of this policy.
COMMENDATION
The $100 classroom fund provides teachers with the opportunity to make purchases that fit their unique teaching methods.