The UNC Policy Manual
600.3.1
Adopted 09/13/91
Amended
09/09/94
Amended
09/08/95
Amended
09/13/96
Amended
05/22/97
Amended
11/13/98
Amended
08/13/99
Amended
02/13/04
Amended
11/12/04
Amended
05/11/07
Amended
10/12/07
Amended
09/09/11
Amended
06/14/13
Amended
05/22/19
I. Achieving and Retaining Status as a
Special Responsibility Constituent Institution.
Management staffing standards and internal controls and safeguards.
A. Responsibilities
of Special Responsibility Constituent Institutions. The following standards and safeguards must
be met and maintained in order to receive and retain the designation as a
special responsibility constituent institution:
1. The chancellor/executive director
must assume personal responsibility and also establish the appropriate
administrative and internal control procedures for carrying out the special
delegations of authority. In this
regard, the chancellor/executive director must certify that the administrative
capability on campus in the areas of budgeting and accounting, personnel, and
purchasing, as noted in 2., 3., and 4., below, are sufficient to carry out the
increased flexibility being granted.
2. The capability of the staff and the
system of budgeting, accounting and internal controls must be sufficient to
administer the increased budget flexibility given to the designated
institutions.
3. The personnel capacity, which must
be exercised under the direction of appropriate administrative officials, must
be available on campus to evaluate jobs, classify positions appropriately, set
compensation properly, and carry out the related functions of position
management at the level of authority provided by the delegation.
4. The on-campus expertise must be
available to purchase properly the equipment, supplies, and other goods and
services for the institution up to the benchmark level established by the Board
of Governors for the institution pursuant to N.C. Gen. Stat. § 116-31.10
(hereinafter G.S.).
5. The institution must maintain its
financial records in such a manner that there are no significant findings in
the annual financial audit reports, special reports, electronic data the State
Auditor's Office.
6. Chancellors/executive directors may
delegate the authority for approving departmental plans for expenditures
authorized under budget flexibility, but may not delegate the authority below
the level of the appropriate vice chancellor.
7. The chancellors/executive directors
shall review an annual internal audit report on expenditures authorized under
budget flexibility, if that audit is deemed necessary based on the annual risk
assessment performed by the internal auditor.
8. The chancellor shall ensure that
procedures and support systems are in place to provide for the effective
operation and maintenance of all existing campus buildings and
infrastructure. Procedures shall also
be in place to assure proper accountability and safeguarding of all fixed
assets and other items purchased by the University.
B. Responsibilities of the President and
the Board of Governors. The president is
directed to establish the administrative procedures necessary to carry out the
following rules:
1. The president and the president’s
staff shall review the annual financial audit reports, special reports,
electronic data processing reports, performance reports, management letters, or
any other report issued by the State Auditor's Office for each special
responsibility constituent institution.
2. The president shall take immediate
action regarding reported weaknesses in the internal control structure,
deficiencies in the accounting records, and noncompliance with rules and regulations. In any instance where significant findings
are identified, the president shall notify the chancellor/executive director of
the particular special responsibility constituent institution that the institution
must make satisfactory progress in resolving the findings, as determined by the
president of the University, after consultation with the State Auditor, within
a three-month period commencing with the date of receipt of the published
financial audit report, any other audit report, or management letter.
3. If satisfactory progress is not made
within a three-month period, the president shall recommend to the Board of
Governors at its next meeting that the designation of the particular
institution as a special responsibility constituent institution be terminated
until such time as the exceptions are resolved to the satisfaction of the
president of the University of North Carolina, after consultation with the
State Auditor. However, once the
designation as a special responsibility constituent institution has been
withdrawn by the Board of Governors, reinstatement may not be effective until
the beginning of the following fiscal year at the earliest.
4. Any actions taken by the Board of
Governors with respect to withdrawal or reinstatement of an institution's
status as a special responsibility constituent institution shall be reported
immediately to the Joint Legislative Education Oversight Committee.
5. The president and the president’s
staff, after consultation with the State Auditor, shall review and consult with
the director of the Office of State Personnel and the director of the Division
of State Purchasing and Contracts in ascertaining whether or not a constituent
institution has the management staff and internal financial controls to
administer the additional authorities authorized under G.S. 116‑30.2, 116‑30.4,
and 116‑31.10. Such review and
consultation must take place no less frequently than once each biennium.
II. Budget
Administration
A. Appropriations
to Special Responsibility Constituent Institutions
1. All General Fund appropriations made
by the General Assembly for continuing operations of a special responsibility
constituent institution of the University of North Carolina System shall be
made in the form of a single sum to each budget code of the institution for
each year of the fiscal period for which the appropriations are being made.
2. Notwithstanding G.S. 143C-6-4, each
special responsibility constituent institution may expend the General Fund
monies so appropriated to it in the manner deemed by the chancellor/executive
director to be calculated to maintain and advance the programs and services of
the institutions, consistent with the directives and policies of the Board of
Governors including but not limited to the following:
a. A current institutional expenditure
plan for each budget code must be established and maintained under the
direction of the chancellor/executive director.
b. No action shall be taken that would
materially change the capability of the institution to carry out its
educational mission as defined by the Board of Governors. The Board of Governors will retain program
responsibility. No actions taken should
have the effect of either establishing a new academic, research, or public
service program or closing such a program without the specific approval by the
Board. Reallocation of academic program
resources should not be made to the extent that a particular existing program
is seriously weakened or effectively discontinued, or a new activity not
expressly authorized by the Board of Governors is initiated.
c. Reallocations of interinstitutional
program resources should not be made to the extent that campus participation in
a particular program is materially weakened without specific approval by the
Board.
d. No action should be taken which
would have the effect of establishing a new community service or student
financial aid program without specific approval by the Board of Governors.
e. Appropriations providing support for
distance education/extension degree credit instruction at off-campus locations
cannot be reallocated for other purposes without specific approval by the Board
of Governors.
3. The quarterly allotment procedure
established pursuant to G.S. 143C-6-3 shall apply to the General Fund
appropriations made for the current operations of each special responsibility
constituent institution.
4. All General Fund monies so
appropriated to each special responsibility constituent institution shall be
recorded, reported, and audited in the same manner as are General Fund
appropriations to other constituent institutions.
5. The preparation, presentation, and
review of General Fund budget requests of special responsibility constituent
institutions shall be conducted in the same manner as are requests of other
constituent institutions.
B. Reversions and Carry-Forward of
Appropriations. Of the General Fund current operations appropriations credit
balance remaining in each budget code of a special responsibility constituent
institution, at the close of a fiscal year, any amount of the General Fund
appropriations for that budget code, may be carried forward by the institution
to the next fiscal year and may be used for one–time expenditures that will not
impose additional financial obligations on the State. However, the amount carried forward under
this section shall not exceed two and one–half percent (2½%) of the General Fund appropriation. The director of the budget, under the
authority set forth in G.S. 143-25, shall establish the General Fund current
operations credit balance remaining in each budget code of each institution
III. Personnel
Administration. The chancellor of a
special responsibility constituent institution, when the chancellor finds that
to do so would help to maintain and advance the programs and services of the
institution, may establish and abolish positions, acting in accordance with:
A. State personnel policies and
procedures if these positions are subject to the and if the institution is
operating under the terms of a Performance Agreement or a Decentralization
Agreement authorized under Chapter 126 of the General Statutes; or
B. Policies and procedures of the Board
of Governors if these positions are exempt from the State Human Resources Act.
C. The results achieved by establishing
and abolishing positions pursuant to the conditions set forth in subsection A.,
of this section, shall be subject to postauditing by the Office of State Human
Resources.
D. With respect to personnel actions
taken under subsection B., of this section, no action should have the effect of
either establishing a new academic program or administrative unit or closing an
existing academic or inter–institutional program or administrative unit. No action should be taken which permanently
reduces the number or amount of Regular Term budgeted teaching positions
supported by General Fund appropriations thereby changing the student–faculty
ratio or the budgeted average teaching salary established by the Board of
Governors.
E. Implementation of all personnel
actions shall be subject to the availability of funds within the institution's
current budget to fund the full annualized costs of these actions.
IV. Purchasing
A. Notwithstanding G.S. 143-53.1 or G.S.
143-53(a)(2), the expenditure benchmark for a special responsibility
constituent institution with regard to competitive bid procedures and the bid
value benchmark shall be an amount not greater than $500,000. The Board shall set the benchmark for each
institution from time to time. In
setting an institution’s benchmark, the Board shall consider the institution’s
overall capabilities including staff resources, purchasing compliance reviews,
and audit reports. The Board shall also
consult with the director of the Division of Purchase and Contract and the director
of the Budget prior to setting the benchmark.
B. Institutions with an expenditure
benchmark greater than $250,000 but not greater than $500,000 shall submit to
the Division of Purchase and Contract for that Division’s approval, or other
action deemed necessary by the Division, a copy of all offers received and the
institution’s recommendation of award or other action. Notice of the Division’s decision shall be
sent to that institution. The
institution shall then proceed with the award of contract or other action
recommended by the Division.
C. The power and authority granted to
the Board of Governors with regard to the acquisition, operation, maintenance
and disposition of real and personal property and services shall be subject to,
and exercised in accordance with, the provisions of Chapters 143 and 146 of the
North Carolina General Statutes and related sections of the North Carolina
Administrative Code, except when a purchase is being made that is not covered
by a State term contract and either:
1. The funds used to procure personal
property or services are not moneys appropriated from the General Fund or
received as tuition or, in the case of multiple fund sources, moneys
appropriated from the General Fund or received as tuition do not exceed 30
percent of the total funds; or
2. The funds used to procure personal
property or services are contract and grant funds or, in the case of multiple
fund sources, the contract and grant funds exceed 50 percent of the total
funds.
D. When a special responsibility
constituent institution procures personal property or services under condition
A. or B., above, the special responsibility constituent institution is
delegated the authority to procure the property or services without approval by
the Board of Governors, and the requirements of Chapter 143, Article 3 shall
apply, except the approval or oversight of the Secretary of Administration, the
State purchasing officer, or the Board of Awards shall not be required,
regardless of dollar value.
E. Special responsibility constituent
institutions shall have the authority to purchase equipment, materials,
supplies, and services from sources other than those certified by the Secretary
of Administration on term contracts, subject to the following conditions:
1. The purchase price, including the
cost of delivery, is less than the cost under the State term contract;
2. The items are the same or
substantially similar in quality, service, and performance as items available
under State term contracts;
3. The cost of the purchase shall not
exceed the benchmark established under G. S. 116-31.10; and
4. The special responsibility
constituent institution notifies the Department of Administration of purchases
consistently being made under this provision so that State term contracts may
be improved.
F. All special responsibility
constituent institutions are authorized to contract with service providers under
arrangements that provide for the receipt of funds electronically pursuant to
the provisions in G.S. 116-40.22(e).
V. Impact on
Education. Each special responsibility
constituent institution shall include in its institutional effectiveness plan
those assessment measures that are determined by the Board to be measures that
will assure some standard measure of student learning and development in
general undergraduate education. The
intent of this requirement is to measure the impact of G.S. 116–30.1 through
G.S. 116–30.5, establishing and administering special responsibility
constituent institutions, and their implementation on undergraduate student
learning and development. The measures
shall be taken from accountability reports to the Board and any other
performance measures developed for this purpose by the Board.
VI. Reporting
Requirements; Monthly Report. Each
designated institution must prepare a monthly operating report for each budget
code in the format of the current BD–701 report. The "Authorized Budget" included in
this report, which may be changed under the direction of the chancellor/executive
director, will show the institution's current expenditure plan. The current
Chart of Accounts will be used for reporting purposes.
VII. Other Matters
A. Effective
Date. The requirements of this policy
shall be effective on the date of its adoption the Board of Governors.
B. Relation
to State Laws. The foregoing policies as
adopted by the Board of Governors are meant to supplement, and do not purport
to supplant or modify, those statutory enactments which may govern the
activities of public officials.
C. Regulations
and Guidelines. These policies shall be
implemented and applied in accordance with such regulations and guidelines as
may be adopted from time to time by the president.