News Release from AASCU

FOR IMMEDIATE RELEASE 2010-04-14

Contact: Jennifer Herrera (202) 478-4665

NEW REPORT ON PROCUREMENT REFORM SHOWS POTENTIAL GAINS IN PUBLIC COLLEGE COST SAVINGS AND PRODUCTIVITY

 Washington, D.C.—A new report released today by the American Association of State Colleges and Universities (AASCU) and the National Association of Educational Procurement (NAEP) reveals that significant opportunity exists to increase cost savings, efficiency and productivity through the reform of state and institutional policies in public higher education procurement.
Based on a survey of procurement officials at the nation’s public four-year universities, the report looks at the impact of state policies on institutional efforts to better control costs in campuses’ purchasing operations.

According to the report, some state procurement policies—such as the mandated use of state contracts—inhibit colleges’ and universities’ ability to fully maximize purchasing power, generate cost savings, enhance product/service quality and improve procurement efficiency and productivity.  Data shows that there is a general sense that some state policies limit institutions’ ability to appropriately tailor their purchasing needs.

 

 “At a time when federal and state lawmakers are calling on higher education leaders to do more with less, attention must also be paid to the role that state regulatory reform can play in reducing costs and improving efficiency,” says AASCU President Muriel A. Howard.  “Such reform in the multibillion-dollar higher education procurement enterprise offers great opportunity for individual campuses and university systems to streamline purchasing operations to save time and money, and to increase product and service quality. But most importantly, it would enable the redirecting of critical resources toward universities’ core missions of teaching and learning,” she says.
 

 

 The survey reveals that although U.S. public colleges and universities frequently use technologies that facilitate smart purchase expenditures, further improvements can be realized through the use of additional e-procurement tools that can help institutions better assess, control and leverage procurement expenditures. The study also notes that institutions authorized by state policy to participate in cooperative purchasing arrangements are making broad use of such compacts.

 

 “This study affirms that, while institutions are making gains in boosting cost savings and productivity in their procurement operations, much more can be done, in partnership with states, to streamline the procurement process,” said Doreen Murner, CEO of NAEP. “The purchasing function on college campuses can often go unnoticed. Yet this study illustrates its pervasiveness and underscores the opportunity for reform, while maintaining accountability for taxpayer-provided appropriations and students’ tuition dollars.”
Included in the study are recent examples of effective state procurement policy reforms.  The report offers several key recommendations for states, systems and institutions.  Among them:

 

 Key Recommendations for States 

  1. Provide greater autonomy to systems and institutions regarding procurement policy;
  2. Review and, if warranted, increase the minimum dollar threshold for purchases requiring state approval, as well as adjust minimum thresholds involving formal competitive (sealed) bids;
  3. Make participation in state purchasing contracts voluntary; and
  4. Allow institutions to participate in group-purchasing consortia.

Key Recommendations for Systems and Institutions

  1. Where state policy allows, seek to fully utilize opportunities to participate in group purchasing consortia;
  2. To the extent that institutional resources permit, further analyze institutional procurement expenditures through greater utilization of e-procurement tools;
  3. Review current system/institutional procurement rules with the goal of developing a cohesive and comprehensive policy;
  4. Build a campus culture of procurement accountability; implement institutional policies to ensure that administrative purchases are made through established contracts.

The report is available online at http://www.aascu.org/media/policy/procurement10 

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AASCU is the leadership association of 430 public colleges and universities Delivering America’s Promise through their common commitments to access, affordability and educational opportunity. Enrolling more than 3 million students, these institutions fulfill the expectations of a public university by working for the public good through education, stewardship and engagement, thereby improving the lives of people in their community, their region and their state.

 

The National Association of Educational Procurement (NAEP) has since the 1920s served as the non-profit professional association primarily dedicated to serving higher education purchasing officers in the U.S. and Canada. NAEP’s mission is to facilitate the development, exchange and practice of effective and ethical procurement principles and techniques within higher education and associated communities, through continuing education, networking, public information and advocacy. Serving over 1,500 member colleges and universities, the association provides progressive knowledge management in strategic sourcing, supply chain, materials and logistics for procurement professionals.