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Procurement Card Policy Manual

Procurement Card Policy Manual (Word)

State of Maine Procurement Card Program
JP Morgan Chase -  MasterCard

  • The Division of Purchases is responsible for oversight of the statewide Procurement Card Program.  The Director of Purchases issues state policy, coordinates with participating state agencies and the Bank, and assists state agencies in establishing and carrying out the program.
  • The Division of Purchases is responsible for determining whether purchases under the Procurement Card Program comply with State procurement law, policies, and procedures.
  • The Commissioner of each using agency has the responsibility for designating authorized Custodians, Cardholders, and Designated Users.
  • The Site Coordinator is responsible for general supervision of the Procurement Card Program within the Agency.  The Program Administrator in the Division of Purchases will control the issuance of cards while the agency coordinator in conjunction with DAFS, Division of Financial and Personnel Services will ensure prompt reconciliation and payment of periodic statements.

Requesting and Obtaining a Procurement Card

  1. To request a Procurement Card as a Custodian (State Employee) or a Cardholder, an employee shall submit (1) a Bank Purchasing Card Application to their agency site coordinator.
  2. The Site Coordinator will either approve or deny the application for a Procurement Card.  If the application is denied, the Site Coordinator will notify the applicant of the denial and the reasons therefor.  If the application is approved, the Site Coordinator will sign the application, specify limits for the Card, and forward the application to the Division of Purchases, which, in turn, will forward the application to the Bank for issuance of the Card.
  3. The Bank will issue Procurement Cards to Custodians and Cardholders upon receipt of a signed written request from the Division of Purchases.  Upon issuance, the Bank sends the Card directly to the Program Administrator, who, in turn, forwards the Card to the Site Coordinator of each agency.
  4. Upon receipt of the Procurement Card, the Site Coordinator will contact the Custodian or Cardholder to schedule a meeting to receive and discuss the use of the Card.  At the meeting, the Site Coordinator will review with the Custodian or Cardholder instructions regarding record-keeping, authorized and unauthorized purchases, and emergency numbers for use if the card is lost or stolen.  When card is given to the cardholder they must sign an Acceptance Agreement.
  5. The employee may begin using the new Card as soon as the employee activates it as explained in the instructions.

Authorized Use of Procurement Cards

Custodians, Cardholders, and Designated Users may use a Procurement Card solely for transactions that further the interest of the State, as that phrase is defined in subparagraph B(6).

Unauthorized Use of Procurement Cards

  1. Unauthorized Use.  Procurement Cards may not be used for any of the following purposes:
    1. Personal purposes;
    2. Travel expenses (e.g., lodging, meals, car rentals, airline tickets) except with approval from the Director of the Division of Purchases and the agency’s  Travel Coordinator.
    3. Obtaining cash;
    4. Capital outlays;
    5. Services that are reported to the IRS via Form 1099;
    6. Purchases in excess of the limits authorized for the Card; and
    7. Any other purchases not authorized by the State or the Department.
  2. Consequences of Unauthorized Use
    1. If a Custodian or Cardholder engages in unauthorized use of the Procurement Card, as specified by subparagraph F(1), the Custodian or Cardholder will forfeit the Card, the Card will be cancelled, and the Custodian or Cardholder will be subject to disciplinary action up to and including dismissal.  If a Designated User engages in unauthorized use, the card will not be cancelled, but the Designated User will be subject to disciplinary action, up to and including dismissal, and will be ineligible for restoration of Procurement Card privileges.
    2. In addition to the sanctions prescribed in subparagraph 2(a), the State of Maine reserves the right to refer instances of unauthorized use that violate Maine or Federal law to the appropriate law enforcement agency.
    3. The State of Maine reserves the right to collect from an employee the cost of any purchases made by the employee with a Procurement Card that do not further the business of the State.  The State may collect those amounts through payroll deduction or any other collection process.

Procurement Card Limits

  • Each Procurement Card will have one or more monetary limits.  The Director of the Division of Purchases, in consultation with the Agency Coordinator, approves limits for all Procurement Cards.  The limits for a particular card will be based upon the anticipated requirements of the office, section, or division for which the Card is issued.
  • Each Procurement Card issued to an employee of the Agency will have a monthly limit, that is, a limit on the dollar amount of all purchases that may be made with the Card during a given month.  That limit shall not exceed $20,000, except with approval of the Director of the Division of Purchases.
  • No Procurement Card purchase of any single item and no single Procurement Card transaction involving multiple items may exceed $2,500, except with approval of the Director of the Division of Purchases.  A lower limit for single items and transactions may be imposed.
  • The Division of Purchases assigns Merchant Category Codes to each Procurement Card.  The Card cannot be used to purchase goods or services that fall within Codes that are not authorized for the Card.  The Program Administrator can inform Custodians and Cardholders as to the types of transactions that are not authorized for their particular Card.
  • The limitations imposed on the Procurement Card are imposed at the point of sale if the merchant requests authorization for the transaction.  If the merchant does not request authorization, the transaction will appear on the daily Cardholder Transaction Violations Report.

Procurement Card Security

  • Security Required.  Custodians, Cardholders, and Designated Users must secure and control the Procurement Card at all times.
  • Secure Location.  Whenever a Procurement Card is not in the personal possession of a Custodian, Cardholder, or Designated User, the Custodian, Cardholder, or Designated User must place the Card in a secure, locked location.  The Custodian, Cardholder, or Designated User must limit access to the secure location and regularly confirm that the Card is still stored in the location.
  • Transfers of Custody.  A Custodian shall document all transfers of custody of the Procurement Card to a Designated User, noting the name of the Designated User, the date of the transfer, and the time of return of the Card.  The Custodian shall retain such documentation for a period of one year following each transfer of custody of the Card.

Documenting Purchases

  1. Documentation Required.  Each authorized user of a Procurement Card – Custodian, Cardholder, or Designated User – must submit to the Agency Coordinator acceptable documentation for all purchases.  Such documentation shall be submitted immediately after each purchase, and in no case later than the end of the month.
  2. Acceptable Documentation.  Acceptable documentation for purchases consists of the original itemized credit card receipt and one of the following:
    1. Itemized sales slip;
    2. Itemized packing slip;
    3. Itemized cash register receipt; or
    4. Itemized repair order.
  3. Alternative Documentation.  If acceptable documentation is unavailable, the user of the Card must first make a reasonable attempt to obtain a copy of the acceptable documentation from the merchant.   If the user of the Card is unable to obtain acceptable documentation after making a reasonable attempt to do so, the Card user must substitute the following alternative documentation.
    1. When the credit card receipt is missing, submit a statement identifying the name and address of the merchant, the date of the purchase, the amount and a description of the item(s) purchased, together with one of the other items of documentation listed in subsection 2.
    2. When documentation other than the credit card receipt is missing, attach to the credit card receipt a statement identifying the date of purchase, the amount and description of the item(s) purchased, and the name and address of the vendor if that information does not appear on the credit card receipt.
  4. Pattern of Missing Documentation.  A pattern of missing documentation may result in the employee’s forfeiture of the Procurement Card and/or loss of Procurement Card privileges.

Processing Credit Card Payments

  1. The Agency Coordinator will establish procedures to ensure prompt payment of Procurement Card purchases.
  2. Upon receipt of the documentation of a Procurement Card purchase, the Agency Coordinator will review the documentation to ensure that it is acceptable under this Policy and that it will permit proper recording of expenditures by account, character, and object. 
  3. The Division of Financial and Personnel Services will submit a receivable (RE) to the Agency for payment of Procurement Card charges.  The Agency must process the payment within 5 days of receipt and make payment by a payment voucher (PV9) electronically loaded into MFASIS.
  4. Each Custodian or Cardholder is responsible for ensuring that the Agency or State of Maine receives any item purchased with the Procurement Card and for obtaining receipts and other documentation of transactions made with the Card.

Record-Keeping

  1. The Agency Coordinator shall:
    1. Maintain a current list of every active card issued to a Custodian or to a Cardholder; and
    2. Maintain for two years a permanent file containing the documentation for every purchase made with a Procurement Card issued by the Department.  This file is subject to periodic review by the State Controller, the Division of Purchases, and any duly authorized auditor.
    3. Ensure that employees who are authorized to use their procurement card for travel do not submit expense vouchers for expenses paid with the card.
  2. The Bank makes all Procurement Card transactions available on-line via the Internet for edits by Custodians and Cardholders or by Accounting.  Edits typically include entry of appropriation numbers and descriptions of items purchased.
  3. The Bank sends an e-mail weekly to the Custodian or Cardholder, and to the Director of Accounting, notifying them that information regarding transactions is available on line for editing.  Upon receipt of the e-mail, each Custodian or Cardholder shall match the receipt with the purchase and edit the accounting information as necessary in the Internet-based data system supplied by the Bank.  Custodians and Cardholders shall complete their edits to transactions within three days of their receipt of the e-mail from the Bank.

Lost or Stolen Cards

If a Procurement Card is lost or stolen, the Custodian or Cardholder to whom the Card was issued, or the Designated User who had custody of the Card when it was lost or stolen, must:

  • Call the credit card company immediately at 1-800-270-7760.  Someone is available at this number 24 hours a day, 7 days a week; and
  • Call the Program Administrator (207-624-7335) as soon as possible after calling the credit card company.

Disputing Transactions

If a cardholder has an item on their billing which they dispute, the cardholder should first call the vendor to get credit.  If the vendor cannot or will not help, the cardholder can call JP Morgan Chase customer service at 1-800-270-7760 or dispute directly online.  JP Morgan will provide the cardholder with an affidavit for their signature.  All disputes must be communicated to JP Morgan Chase within 60 days or charge.  After 60 days, the responsibility of the charge cannot be disputed.

Travel

Each Agency/Department will be responsible for a Primary Travel Coordinator and a back-up.  Only upon approval from the Agency Travel Coordinator will the procurement card be used for purchasing airline, registration fees, car rentals and lodging.  Meals, incidentals, etc. will still be reimbursed through the expense process.