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Hospitality Guidelines
IntroductionIn accordance with Executive Order No. 761 (Hospitality, Payment or Reimbursement of Expenses), San José State University will procure and pay for allowable and reasonable hospitality expenses directly related to, or associated with, the active conduct of official university business. These university guidelines do not address auxiliary organization policy. These guidelines also do not pertain to food expenses of employees traveling on university business or when working in overtime status. (Refer to the campus Travel Guide for policy covering those types of expenses). Allowable Expenses and EventsWhen a university employee acts as an official host, the occasion must, in the best judgment of the approving authority, serve a clear business purpose, with no personal benefit derived by the official host or other university employees. The expenditure of funds for hospitality should be cost effective and in accordance with the best use of public funds. Hospitality expenses, including awards and gifts, must conform to IRS regulations. The following are examples of occasions when the provision of hospitality is permitted:
Prohibited Expenses and EventsThe following are examples of the types of events where food expenses and gifts are not allowed under the Executive Order:
Gifts of cash are prohibited. Approval of TransactionsThe head of the department requesting payment of hospitality expenses must signify approval by electronically approving or signing the direct payment request, petty cash request, procurement card statement, or requisition. The department head must maintain department records that clearly indicate the justification behind the expense (university hosted reception, development, etc.) and whether the event was attended by an official guest(s) of the university. These records are subject to internal and external audit. State regulations prohibit individuals from approving their own expense reimbursement and subordinates from approving expense reimbursements of their supervisor. Guidelines for approving officials: When determining whether expenses for hospitality are appropriate, the approving official must evaluate the following:
Caterers and Other Food ProvidersThe Purchasing Office maintains a list of Preferred Caterers that includes Spartan Shops Campus Dining. Caterers on this list have met all State and CSU requirements for caterers by providing Purchasing with a payee data record (Form 204), a copy of their current Santa Clara County Health Department license, proof of insurance coverage, and an agreement to accept payment by the SJSU Procurement Card. The Petty Cash reimbursement process will be used for expenses under $50. The SJSU Procurement Card is the preferred method of payment for business-related food expenses greater than $50. When the card is used, all relevant, itemized receipts are to be submitted to Accounts Payable along with the reconciled Procurement Card statement. Prior to rendering services, non-campus individuals or businesses not on the SJSU Preferred Caterers List must provide a payee data record (Form 204), a copy of a current Santa Clara County Department of Health license issued in their name, and proof of compliance with current campus insurance requirements as specified by the University Risk Management Department. Funding SourcesHospitality expenses may be paid from various university fund sources, subject to the rules outlined below and the restrictions identified in Table 1. It is the responsibility of the President's designees to ensure that all funds are used in accordance with this policy. There are two types of funds available for the payment of hospitality expenses, General Fund Appropriations and Special Funds. General Fund Appropriations: The following restrictions, as identified in Table 1, apply to the use of General Fund Appropriations:
Special Funds: The following restrictions, as identified in Table 1, apply to the use of Special Funds:
Table 1 : Funding Sources for Payment of Hospitality Expenses
Definitions
HelpIf you have questions regarding the Hospitality Guidelines, contact the Procurement Card Coordinator at 924-1568. Frequently Asked QuestionsThe following questions and answers are provided to assist departments in the use of the hospitality guidelines. They are consistent with the intent and spirit of Executive Order 761, but should not be construed as a strict interpretation. What paperwork is required by the Purchasing Office to procure or pay for hospitality expenses? At a minimum, each procurement pathway requires an itemized receipt or invoice including a description of services, items, sizes, quantities, unit prices and extended totals. Additional information regarding the use of petty cash, procurement cards, direct payment and requisition requests can be found on the Procurement & Support Services (PASS) website at http://www.sjsu.edu/pass. Do I have to provide a written justification to the Purchasing Office with my request to procure or pay for hospitality expenses? No. The approving officer signifies that the event or purchase meets the criteria for an allowable hospitality expense when he/she approves the transaction. The approving officer is also responsible for signifying that the correct funds were used. However, supportive documentation including a justification for the hospitality expense must be kept on file within the department. The justification is generally a short statement (one or two sentences) that describes the event purpose. It is also important to record whether the event was attended by an official guest(s) of the university. Are department files subject to audit or review? Yes. As necessary, files must be accessible to internal and external auditors. When is it appropriate to present a gift to a non-university individual or organization? It must be determined that the gift benefits SJSU or is clearly necessary to the fulfillment of SJSU’s mission. Examples of individuals or organizations that may be presented with a gift include the following:
Can a donor gift be given to a university employee who donates to the university? Yes. Gifts to any donor must follow IRS guidelines that specify that a gift may not exceed 2% of the donor’s contribution. Is there a dollar limit for gifts to non-university individuals or organizations? The level of contribution to SJSU determines the level of gift. Gifts to donors must follow IRS guidelines that specify that a gift may not exceed 2% of the donor’s contribution. Gifts to foreign dignitaries should thoughtfully reflect the culture of gift giving in the recipient’s home country. Under what circumstances can gifts be purchased with special university funds to recognize employees? Gifts of a non-promotional nature to employees are prohibited. Therefore, only promotional items and earned donor gifts can be given to employees. Under what circumstances can an award be purchased at the department level to recognize employees? Excluding certificates of award, awards at the department level are prohibited. Can nominal motivational or inspirational items be purchased for employees from Successories and other similar vendors? Yes, as long as the items are purchased for use or display in the office. Ordering office supplies with motivational or inspirational messages is allowed. If Office Max doesn’t carry the item, an alternate vendor can be selected using the procurement card for payment. How are promotional items procured? The Spartan Bookstore carries a variety of stocked promotional items. Purchases at the bookstore should be made with a campus procurement card. All other promotional items will involve new custom printing and, therefore, must be procured using the requisition/purchase order process. Submit completed web requisitions (including suggested vendors) to the Purchasing Office. The university’s Print Buyer will place the order with an appropriate vendor. Can promotional items be given to university employees? Yes. Can tickets be purchased with university funds for employees to attend university events like the College of Business Banquet? Yes, with department approval using the direct payment process. Tickets for staff and faculty may be purchased for fund raising, community relations and outreach events if attendance serves a promotional purpose (i.e., promoting the university by soliciting donations and scholarships, promoting legislation, enhancing visibility in the community, etc.). Can tickets be purchased with university funds for an employee’s spouse or partner to attend university events like the College of Business Banquet? Yes, with department approval as long as the employee’s spouse or partner has registered as a university volunteer and his/her attendance serves a promotional purpose. To register as a university volunteer, contact Human Resources. Are students considered official university guests? Students already enrolled at SJSU are not considered university guests. Potential students (elementary, middle school, high school and non-SJSU university students) can be considered official university guests. Can I use university funds from the Faculty Mentor Program to buy student gift certificates or event tickets? Yes, nominal non-cash gifts can be given to student participants. As a means to develop the mentor – student relationship, event tickets for the mentor and student may be purchased with special funds. A student assistant who has worked for our department is graduating, can we use university funds to pay for a farewell gathering and/or gift? No, university funds cannot be used to pay for farewell gatherings (excluding retirement receptions) or farewell gifts. Can I use university funds to pay for a retirement reception? Yes. The costs for food and room rental (if applicable) can be paid for with university funds. The appropriate cost fund is determined by attendance (will official guests attend?). Can I use university funds to pay for a retirement gift? No. Can I purchase paper plates, cups, plastic utensils and napkins in bulk quantities for future use? Yes, as long as the products will be used for approved hospitality events. The most effective way to pay for these products is through the Office Max web ordering system. Can I purchase decorations such as balloons and flower centerpieces for a reception? Yes. Balloons and other nominal, disposable decorations can be purchased for approved hospitality events using general funds or special funds. Because flower centerpieces can also be categorized as gifts (given to honorees or guests at the reception’s conclusion), they should be purchased for approved hospitality events using special funds. We are conducting an off-site office retreat. How do I proceed? Select a retreat location and submit a web requisition to the Purchasing Office. The requisition should detail the specifics of the event, indicate a per person charge or not to exceed amount, and identify a department point of contact. Do not sign any agreements directly with the hotel or conference site provider. The university’s Buyer will sign any necessary agreements and process any required deposits. The department point of contact has the responsibility of verifying satisfactory service and approving the final payment. Allowable expenses include meeting room and equipment rental, and food and light refreshments. Can my department hire an entertainer to perform at our staff retreat? Speakers can be compensated for attending a staff retreat. Any other form of entertainment cannot be paid for with university funds. Is paid entertainment allowed at any event? Generally, paid entertainment (excluding speakers) is allowed only at outreach and special university-wide events. Contact the Purchasing Office for additional assistance or information. What is the definition of a qualified business meeting? Qualified meetings should take place over an extended period of time, and the agenda should include a working meal to satisfy the requirement that the meal is part of a business function. The expenditure of state funds is not permitted when two or more employees choose to go to lunch together to continue their business as an incidental part of the meal, or when the meeting could have been scheduled during regular work hours. |
Norma Lorigo, C.P.M., Director San José State University Located in Clark Hall 500 |
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