Contracts, Purchase Orders, & Vendor Agreements
A contract or purchase order (called a commitment document in the fiscal rules) is required to encumber funds for any purchase exceeding $5,000 Generally, there are three types of commitment documents used in state procurement: purchase orders, contracts and vendor agreements. For some purchase orders, the requirement for a commitment document is exempted in fiscal rule 2-2, section 4.2.
Some general considerations for all purchase orders and contracts include fair and reasonable pricing, the risk to the State and the special requirements when federal dollars are being expended.