1. Department of Administrative Services 1 Welcome to the Purchasing Card Policy Changes Webinar The meeting will begin promptly at 10:00 AM Instructions: Dial into the conference call to hear the audio. The number is 712-580-0380 Enter the passcode: 818179# If you have technical difficulty, call the Meeting HelpDesk at 404-561-4671 After you announce yourself, you will be placed on hold until the Meeting Organizer addresses you During the Presentation: All callers, except the presenter, will be muted You can ask questions by using the Question and Answer or Chat messaging feature on the Webinar Panel Your questions will be answered at the end of the presentation

2. Department of Administrative Services 2 GoToMeeting Control Panel During the presentation, you will probably want to keep the Question and Answer box minimized unless you are asking a question. When you have finished typing a question, click Send. Your question should appear in the Questions/Asker box. Click this arrow to minimize or maximize the panel.

3. July 21, 2008 Purchasing Card Policy Changes An Overview of Statewide Purchasing Card Policy and HB 1113 State of Georgia Department of Administrative Services

4. Department of Administrative Services 4 Webinar Guidelines Questions Responses to Questions Follow Up Use the Question and Answer or Chat messaging feature on the Webinar Panel Questions will be answered at the end of the presentation A recording of the Webinar will be posted on the State Purchasing Division website Additional Questions You can mail additional questions through the Purchasing@doas.ga.gov email address Purchasing@doas.ga.gov

5. Department of Administrative Services 5 Your Presenter Title: State Cards Program Manager Accomplishments: Over 16 years of bankcard experience Contact: Paul.Kurtz@doas.ga.gov Phone: 404.656.5344 Paul Kurtz

6. Department of Administrative Services 6 Agenda Overview of HB 1113 Statewide Purchasing Card Policy Local Program Roles and Responsibilities About the P-Card Links and Resources Questions

7. Department of Administrative Services 7 Overview of HB 1113

8. Department of Administrative Services 8 State Code: §50-5-83 What the new law does: ▪Defines unlawful use of the purchasing card and other forms of payment “so as to prohibit the use of state funds by purchase orders, government contracts, credits cards, charge cards, or debit cards, or other such payment vehicles for personal benefit or gain” ▪Provides requirements for the State Purchasing Card Program ▪Defines penalties for violators ▪Authorizes the communication of rules and regulations

9. Department of Administrative Services 9 State Code: §50-5-83 (Continued) What the new law doesn’t do: ▪Make it harder or less beneficial to use the purchasing card ▪Change the intended use of the card ▪Present a reason not to use the card in a proper and legal manner

10. Department of Administrative Services 10 State Code: §50-5-80 (Continued) Use of the Purchasing Card for unauthorized or personal purchases is prohibited ▪Any person who obtains goods or services in an amount less than $500 will be guilty of a misdemeanor of a high and aggravated nature ▪Purchases equal to or greater than $500 shall constitute a felony In addition to criminal consequences, there are also employment and restitution repercussions ▪Immediate termination of state employment ▪Restitution of the purchase amount plus interest Any person (including supervisors or other approving officials) who knowingly or through willful neglect assists are subject to the same penalties

11. Department of Administrative Services 11 State Code: §50-5-83 O.C.G.A. §50-5-83(b)(12) requires criminal background checks on all employees hired for positions that are eligible for purchasing card ▪Existing Cardholders as of July 1, 2008 Background checks required prior to the next renewal date of the individual P-card Discovery of “any misdemeanors or felonies related to financial wrongdoing, theft, or other act of dishonesty” requires cardholder’s privileges immediately terminated and notification of State Cards Program Manager ▪New cardholders after July 1, 2008 Criminal background check require prior to issuing card Discovery of “any misdemeanors or felonies related to financial wrongdoing, theft, or other act of dishonesty” eliminates employees eligibility to have a card

12. Department of Administrative Services 12 State Code: §50-5-83 (Continued) O.C.G.A. §50-5-83(b)(12) also requires credit checks on all employees issued a purchasing card after July 1, 2008 prior to issue ▪Obtaining and interpreting the credit checks has been left to the discretion of the agency or institution ▪DOAS can not advise on the law requiring the credit check ▪Agencies and institutions should work internally and with their HR departments to create internal policies regarding credit checks

13. Department of Administrative Services 13 Statewide Purchasing Card Policy

14. Department of Administrative Services 14 Overview of Policy Changes Use of the purchasing card for personal purchases prohibited ▪Misdemeanor and Felony violations defined ▪Consequences for Cardholder and Approver Revision of statewide program administration – two sections ▪Statewide Program ▪Local Program roles and responsibilities Use of Card Program Compliance Legal Issues

15. Department of Administrative Services 15 State Policy Update DOAS administers the contract SPD personnel are resources regarding policy and implementation State Purchasing Card Policy establishes minimum standards of usage Official Policy is posted on the State Purchasing website http://statepurchasing.doas.georgia.gov/vgn/images/portal/cit_1210/9/51/116137225P- cardPolicyNews.pdf

16. Department of Administrative Services 16 State Cards Program Manager Duties and responsibilities: ▪Develop the State Purchasing Card Policy ▪Review Policy at least annually ▪Communicate policy changes to program users ▪Serve as the central point of contact on all issues of policy and procedures ▪Official liaison between the Bank and all program users ▪Review all requests for exceptions to the Policy ▪Work with program users to determine new ways to use the p-card within legal and policy requirements ▪Develop & maintain statewide training materials and manuals

17. Department of Administrative Services 17 DOAS Process Improvement & Audits Duties and responsibilities: ▪Conduct periodic reviews of the programs at entities under the authority of SPD purchasing ▪Issue reports providing an assessment of the program making recommendations for improvement when warranted ▪Require policy improvements and/or place other restrictions on card programs in cases where it is determined that internal controls are not adequate

18. Department of Administrative Services 18 Local Program Roles & Responsibilities

19. Department of Administrative Services 19 Card Program Administration Agency Procurement Officer (APO) or College/University Procurement Officer (CUPO) ▪Serves as official liaison between entity and State Cards Program Manager Roles and responsibilities (can be delegated): ▪Card Program Administrator Program Administration Program Compliance Set appropriate limits on program in order to ensure adequate review Develop training Establish procedures, monitor use Manage account requirements

20. Department of Administrative Services 20 Card Program Administration (continued) Roles and responsibilities (continued): ▪Supervisors/Approving Officials Maintain knowledge of State Purchasing Card Policy as well as internal policies and procedures Request p-cards for users Notify Program Administrator when a cardholder resigns, is terminated or reassigned Monitor transactions and card activity Review all documentation All signatures must be original signatures – rubber stamps are prohibited

21. Department of Administrative Services 21 Card Program Administration (continued) Roles and responsibilities (continued): ▪Cardholder Maintain security of card and all related information Maintain knowledge of State Purchasing Card Policy Ensure all purchases are allowable under State and internal policies Ensure all purchases comply with Georgia Procurement Manual Obtain “best value” for State Maintain all required documentation Sign transaction log and monthly billing statement Ensure timely payment

22. Department of Administrative Services 22 Internal Controls Each entity must have their own policy that ensures compliance with State laws, rules and policies Internal policies may be stricter, but can not be less strict than State policy Internal controls must include: ▪Separation of duties ▪Weekly independent review ▪Appropriate hierarchical review and approval of purchases ▪Prevention of self-approval ▪Appropriate limits on the number of cardholders under one supervisor ▪Provision for an annual independent audit

23. Department of Administrative Services 23 About the P-card

24. Department of Administrative Services 24 Use of the P-card General Policies ▪Purchases must be for official State business ▪Only the employee whose name appears on the card is authorized to use that card ▪Use of the card for personal purchases is strictly prohibited

25. Department of Administrative Services 25 Allowed Purchases Can be used for small value purchases not otherwise prohibited or restricted ▪Supplies ▪Materials ▪Equipment ▪Services Must be within cardholder assigned spending limits Card Program Administrators can manage spending limits up to $5,000 Transactions ≥$5,000 for Open Market Purchases must receive prior written approval from State Cards Program Manager ▪Special Approval Request Form SPD-PC003

26. Department of Administrative Services 26 Allowed Purchases (continued) Allowable Purchases ▪Equipment Single units under $1,000 for State Agencies, Commissions or Boards Single units under $3,000 for colleges and universities under the authority of the Board of Regents ▪Supplies or materials up to the cardholder’s Single Transaction Limit (STL) and/or approved cycle limit ▪Single purchases of supplies and materials over $5,000 provided: Open-Market Purchases have been competitively bid using eQuote, the Georgia Procurement Registry or other electronic solicitation tools: and Prior, written approval is obtained from the local Program Administrator, the purchaser’s supervisor and the SCPM –Use Form SPD-PC003, Purchasing Card Special Approval Request Documentation must include solicitation number ▪No prior approval is needed for purchases exceeding $5,000 from statewide contracts, agency contracts, or mandatory sources ▪Documentation must include reference to Statewide Contract or agency contract number

27. Department of Administrative Services 27 Allowed Purchases (continued) Allowable Purchases (continued) ▪Airline tickets and vehicle rentals for State personnel (refer to State Travel Regulations) ▪For colleges, universities and technical schools: No special approval needed for: –Food and lodging for student activities (see Policy for conditions) –Food for research, laboratory animals or instructional use

28. Department of Administrative Services 28 Prohibited Purchases x Personal purchases of any kind x Cash advances x Gift Cards x Employee travel expenses (except those listed in Allowed Purchases) x Entertainment x Alcohol x Tobacco products x Fuel, repair and maintenance of State-owned or rental vehicles (exceptions with proof of Maximo utilization) x Professional services [as defined by O.C.G.A. §14-7-2(2)] x Food (except for “group meals” according to State Accounting Office Group Meal Policy and allowed purchases for schools)

29. Department of Administrative Services 29 Emergency Purchases In emergencies, Program Administrators are allowed to obtain after-the-fact approval “Emergencies” defined as: ▪Cases involving welfare of the general public ▪Extreme weather conditions ▪Official declared emergencies Program Administrators must submit Form SPD-PC003, Special Approval Request within 72 hours Must follow guidelines for emergency purchases in Georgia Procurement Manual ▪Include Form SPD-NI005, Emergency Justification Form available on SPD website

30. Department of Administrative Services 30 Sole Source/Sole Brand Purchases Guidelines found in Georgia Procurement Manual Any request for a Single Transaction Limit of $5,000 or more qualifying as a Sole Source and/or Sole Brand must include From SPD-NI003a (Sole Brand Justification) or Form SPD- NI003b (Sole Source Justification) or both Forms must be attached to the transaction log and/or monthly billing statement

31. Department of Administrative Services 31 Links & Resources

32. Department of Administrative Services 32 Link to State Code (HB 1113) http://www.legis.ga.gov/legis/2007_08/sum/hb1113.htm DOAS Website http://doas.georgia.gov/02/doas/home/0,2451,21917123,00.html State Purchasing Website http://statepurchasing.doas.georgia.gov/02/doas/osp/home/0,2469,35226973,00.html State Purchasing Card Policy http://statepurchasing.doas.georgia.gov/vgn/images/portal/cit_1210/9/51/116137225P- cardPolicyNews.pdf SPD Official Forms Website http://statepurchasing.doas.georgia.gov/00/channel_title/0,2094,35226973_76322813,00. html

33. Department of Administrative Services 33 Questions?

34. Department of Administrative Services 34 Thank you!