Personal Services Contracts

• Policy

It is the policy of the University of Louisville to establish personal services contracts for professional services in accordance with the provisions of KRS 45A.690 – 45A.695.  Examples of services that must be provided through a personal services contract include but are not limited to consultants, doctors, employee search firms, nurses, lawyers, engineers and architects.

Commodities, equipment and non professional services are not to be procured via a personal services contract.

• Definitions 

Personal service contract is an agreement whereby an individual, firm, partnership, or corporation is to perform certain services requiring professional skill or professional judgment for a specified period of time at a price agreed upon.

Committee means the Government Contract Review Committee of the Legislative Research Commission. 

Contracting body means one of the following:  University of Louisville, University of Louisville Athletic Association, University of Louisville Research Foundation or University of Louisville Foundation, Inc. which must be specifically identified on each contract. 

Governmental emergency means an unforeseen event or set of circumstances that creates an emergency condition as determined by the committee by promulgation of an administrative regulation.

PROCEDURES FOR ESTABLISHMENT OF PERSONAL SERVICE CONTRACT

The following procedures must be utilized in order to establish a Personal Services Contract for the following funding sources:

• UofL State Appropriated Funds
• University of Louisville Research Foundation, Inc.
• University of Louisville Athletic Association, Inc.

Employee or Independent Contractor

When considering the establishment of a personal service contract with an individual, the first determination to be made is whether or not the individual should be added to payroll as a temporary employee or if the nature of the services required dictates that the  worker is an independent contractor.  In order to determine whether an individual shall be an employee or an independent contractor, the relationship of the worker and the business must be examined - all information that provides evidence of the degree of control and the degree of independence must be considered.  Facts relating to evidence of control and independence fall into three categories: behavioral control, financial control and the type of relationship of the parties. All departments seeking to establish a personal service contract with an individual must complete the document entitled Employee or Independent Contractor.  This document must be submitted to the Department of Purchasing at the time the contract is submitted. Please note this determination does not apply when contracting with a firm, partnership or corporation.

Request for Proposal (RFP):

KRS 45A.695 (3): Adequate notice of the need for a personal services contract shall be given by the authorized designee of the contracting body through a Request for Proposal (RFP) as specified in KRS 45A.695(3).  To access the RFP form and instructions, go to Personal Services Contract RFP Form and Instructions.  The Request for Proposal (RFP) shall describe the services required, list the type of information and data required of each offeror, and state the relative importance of particular qualifications.  Anyone acting in the role of evaluator/advisor must sign a Confidentiality/Conflict of Interest Statement.  Signed Confidentiality/Conflict of Interest forms must be kept in the official RFP file.  The originating department is required to submit a copy of all RFP's to the Department of Purchasing for review and approval.  Upon completion of the Department of Purchasing review and approval, the RFP will be posted on the Department of Purchasing website by emailing it to Purchasing, to satisfy the public advertising requirement.  The originating department may also choose to place an ad in a newspaper of general circulation. 

KRS 45A.695 (4): The head of the contracting body or the authorized designee may conduct discussions with any offeror who has submitted a proposal to determine the offeror’s qualifications for further consideration.  Discussions shall not disclose any information derived from proposals submitted by other offerors.

As per requirements set forth in KRS 45A.695 (5) an award shall be made to the offeror determined by the head of the contracting body, or the authorized designee, to be the best qualified of all offerors based on the evaluation factors set forth in the Request for Proposals and the negotiation of fair and reasonable compensation.  If compensation cannot be agreed upon with the best qualified offeror and if proposals were submitted by one (1) or more other offerors determined to be qualified, negotiations may be conducted with the other offeror or offerors in the order of their respective qualification ranking.  In this case, the contract may be awarded to the next best ranked offeror for a fair and reasonable compensation.  All determinations of the qualification rankings of offerors by the head of the contracting body or a designee of the offeror based on evaluation factors set forth in the Request for Proposals shall be made in writing.

Prior to contract award, a department initiating a Personal Service Contract of $100,000 or more, any amount of which is federally funded, shall ensure that the successful vendor is not debarred from doing business with federal agencies.  This policy shall be applicable to both contracts and sub-contracts.  A department may access the List of Parties Excluded from Federal Procurement and Non-procurement Programs on the U.S. General Services Administration (GSA) website to verify that the vendor is not debarred.  The department completing the contract document must complete the PSC Checklist, verifying that this was done and forward to the Department of Purchasing with contract documentation.  Complete info regarding federal debarment can also be found on the GSA website. 

The originating department must submit to the Department of Purchasing a fully completed original personal service contract, evaluation/summary, copy of Request for Proposal issued by the originating department, copy of response from selected vendor, and a copy of advertisement (copy of page from purchasing website).  As a part of the contract documentation a Conflict of Interest Certification form must be signed by the (Recommended by) Chair/Department Head and attached to the forms for submission to the Department of Purchasing.  This form will print as a part of the contract documents.  Written documentation shall be maintained by the originating department concerning the final results of negotiation with each vendor and reasoning as to why each vendor was chosen.  Upon completion of negotiations and award of contract, the current version of the appropriate Personal Services Contract Form is completed by the department and forwarded to the Department of Purchasing.  All forms must be typewritten and any changes made after signatures are affixed must be initialed by all parties.  In the event that health-protected information is to be dealt with, the originating department is responsible for contacting the University of Louisville Privacy Officer for assistance in compliance with applicable statutes.

FORMS:

• University of Louisville State Appropriated Funds
• University of Louisville Research Foundation/Athletic Association Funds

**Departments are required to obtain the appropriate form from the web since the documents are monitored and updated periodically.

SOLE SOURCE PERSONAL SERVICES CONTRACT

KRS 45A.095:  Provides for establishment of personal services contracts by noncompetitive negotiation only for sole source purchases or when competition is not feasible as determined by the Department of Purchasing in writing prior to award or when emergency conditions exist.  Emergency conditions are defined per KRS 45A.095(3): An emergency condition is a situation which creates a threat or impending threat to public health, welfare, or safety such as may arise by reason of fires, floods, tornadoes, other natural or man-caused disasters, epidemics, riots, enemy attack, sabotage, explosion, power failures, energy shortages, transportation emergencies, equipment failures, state or federal legislative mandates, or similar events.  The existence of the emergency condition creates an immediate and serious need for services, construction, or items of tangible personal property that cannot be met through normal procurement methods and the lack of which would seriously threaten the functioning of government, the preservation or protection of property, or health or safety of any person.  Sole source is a situation in which there is only one (1) known capable supplier of a service, occasioned by the unique nature of the requirement, the supplier, or market conditions.

Sole Source Personal Services Contract written justification must be signed by the Chair/Department Head.  Written justification must be submitted to the Department of Purchasing for approval prior to establishing a Personal Services Contract.

Personal service contract forms must be typewritten and any changes made after signatures are affixed must be initialed by all parties.  In the event that health-protected information is to be dealt with, it is the responsibility of the originating party to contact the University of Louisville Privacy Officer for assistance in compliance with all applicable statutes.

AMENDMENT/EXTENSION TO A PERSONAL SERVICE CONTRACT

An Amendment and/or an Extension to a Personal Service Contract shall be processed in the same manner as the original contract.  An Amendment/Extension form shall be used if the parties to an established Personal Service Contract agree to increase or decrease funds, revise the scope of work, extend the time for performance within the current biennium, or any other change. 

REVIEW AND APPROVAL PROCESS FOR PSC'S

1. All UofL State appropriated fund Personal Services and University of Louisville Research Foundation funds contracts will require signatures from the Second Party, Department Chair, and University Department of Purchasing, University Counsel, and Vice President for Business Affairs.  All UofL Athletic Association funds contracts will require signatures from Second Party, University of Louisville Athletic Director, University Department of Purchasing and University Counsel.
2. All University of Louisville State appropriated funded Personal Services contracts must abide by KRS 45A.695(1) which states; "Except as provided in subsection (8) of this section, no one shall begin work on a personal service contract entered into by any contracting body, until notification of the personal service contract is filed with the Government Contract Review Committee.  Each personal service contract shall have a cancellation clause not to exceed thirty (30) days notice to the contractee."
3. University of Louisville Research Foundation and University of Louisville Athletic Association Personal Services contracts will not be required to be submitted to the Government Contract Review Committee, however, no work on contracts shall begin until all required signatures are affixed.  Upon completion of all signatures, a completed copy of the approved personal service contract will be sent to the originating department and the awarded vendor.  It is the responsibility of the department to enter a requisition using the assigned personal service contract number and the vendor number of the firm the contract is awarded to.
4. The Government Contract Review Committee meets once per month to review State appropriated funded Personal Services Contracts.  The completed Personal Service contract must be submitted to the Government Contract Review Committee prior to the close of business of the last working day of the month.  The department must complete the Proof of Necessity form on any personal service contract that is charged to general funds.  It is the responsibility of the originating department to allow for adequate time to go through the entire University process to prepare for a completed personal services contract to be sent to the Government Contract Review Committee.
5. When the Personal Service contract is approved by the Government Contract Review Committee, the originating department will receive a copy of the approved personal service contract.  It is the responsibility of the originating department to enter requisitions using the assigned personal service contract number and the vendor number of the firm that the contract is awarded to.
6. It is the responsibility of the individual departments to keep current copies of completed PSC's on file and to Extend and/or Amend any contracts prior to the end date of the contract.  It is the responsibility of each department to maintain accurate and current start and expiration dates for each contract.
7. Contracts that have passed their established expiration date may not be amended/extended for any reason.

THE FOLLOWING PROCEDURE MUST BE UTILIZED TO ESTABLISH A PERSONAL SERVICE CONTRACT FOR UNIVERSITY OF LOUISVILLE FOUNDATION, INC. FUNDS:

While the University of Louisville Foundation, Inc. is exempt from the requirements of KRS 45A.690-695, it is recommended that all University of Louisville Foundation, Inc. Personal Services Contracts be established through a competitive procurement process.

1. The University of Louisville Foundation, Inc. is not required to follow the requirements of KRS 45A.690-695.
2. Upon completion of negotiations and award of contract the University of Louisville Foundation, Inc. Personal Services Contract form must be completed by the appropriate University of Louisville Foundation staff.
• UofL Foundation, Inc. form
3. All UofL Foundation, Inc. Personal Services Contracts require signatures from Second Party, Department Chair, Foundation Legal Services, and Vice President for Finance.  The Department of Purchasing shall only serve in an advisory capacity for all University of Louisville Foundation, Inc. personal services contracts.
4. All UofL Foundation, Inc. Personal Services Contracts shall be maintained and filed in UofL Foundation, Inc. office.