Acting under a state law that was passed in 2006 and takes effect on June 1 this year, Dr. Edward H. Hammond, president of Fort Hays State University, announced this morning that the university would open its purchasing of goods and services to local and area businesses.
He said FHSU spent roughly $15 million last year under the old system, which required the university to purchase from state-contracted vendors.
FHSU and the Hays Area Chamber of Commerce conducted a joint news conference this morning to announce the change in state purchasing rules that creates millions of dollars in potential sales for businesses in Hays and the surrounding communities. As a symbolic gesture of this new university-community initiative, the news conference took place in an empty storefront at 112 W. Eleventh in downtown Hays. The storefront is an available property of Liberty Group, Inc., in the historic Chestnut Street District.
"The infusion of millions of dollars into the local economy could very well lead to the creation of new businesses that could fill some of the available commercial space in the community, such as the building we're meeting in today," the president said.
Gina Riedel, executive director of the chamber, said she was pleased to participate in the joint news conference. "The Hays Area Chamber of Commerce understands that FHSU plays a huge role in the local economy, and we appreciate everything Dr. Hammond and the university do to partner with local and area businesses," she said. "I understand that FHSU's impact on the community was calculated most recently at nearly $177 million, and this new purchasing policy will pump even more dollars into the local economy."
President Hammond said the university was establishing a three-tier purchasing policy with the authority granted under the new state law:
-- For purchases up to $4,999, university personnel will make inquiries locally and regionally to find the lowest price. If a business can beat the price of the state-contracted vendors, the university will make the purchase from that business.
-- For purchases from $5,000 to $24,999, the university will use an informal bid process, gathering information on lowest prices from at least three businesses and comparing the prices to the state-contractor list. The university will purchase from the local or area business if it can beat the state price.
-- For purchases of $25,000 or greater, the university will continue to use a formal bid process in which qualified vendors must meet specifications and the university will accept the lowest of the quality bids after a formal bid opening.
"If a local vendor can do better than the state price contract, we're going to do business with them," President Hammond said. "Under the old rules, the university had to make purchases from state-contracted vendors even if local vendors could provide the same goods or services at a lower cost. Our goal should be to find the lowest price so that we can be good stewards of the taxpayers' dollars and tuition dollars. With this new purchasing system, we will be able to meet that goal while also supporting businesses in the city, area and region."
The new policy will create a range of opportunities. Of the approximately $15 million that the university spends annually, the president said nearly $1 million was spent on relatively inexpensive items that are available locally. He noted that under the current system there are only three state-approved vendors for computers, but such big-ticket items will also now be open to any business that wishes to compete.
The university has scheduled a luncheon for noon on Monday, April 30, at the Sternberg Museum of Natural History to explain its new purchasing policy in detail. Any businessperson in Hays or the surrounding area who is interested in learning more about the new guidelines and how to participate in the program is welcome to attend the lunch. There is no cost for the lunch, but seating is limited. To reserve a seat, call (785) 628-4232 or send an e-mail to email@example.com by Monday, April 23.
"This is our first run at it," President Hammond said of the new purchasing policy. "We will make improvements in the policy as we learn what works and what doesn't work."
He said the university's purchasing department would soon be announcing training sessions for FHSU personnel so that they also know what procedures to follow under the new policy.