NCCCS EQUIPMENT MANUAL
2. Lease-Purchase and Installment-Purchase Contracts
Community Colleges, under G.S. 115D-58.15, are authorized to enter into lease-purchase and installment-purchase contracts. As with any purchase of goods, you must follow the purchasing procedures prescribed by P&C or ITS. For installment purchases, it is recommended that you seek a separate contract for the financing in order to secure the best financing rate.
It is important to remember that your local board of trustees must approve all contracts, and if the contract exceeds $100,000 or three years, the following rules also apply:
If the contract is for $100,000 or less, or for three years or less, approval is not required from the State Board of Community Colleges (State Board) or your county commissioners.
If state funds are used and the contract exceeds $100,000 or three years, it must be approved by the State Board.
If local funds are used and the contract exceeds $100,000 or three years, it must be approved by your county commissioners in the form of a resolution. The commissioners must also acknowledge in writing that the college may require appropriations from them in order for the college to meet the obligations of the contract.
If local funds are used and the contract is for $500,000 or more, and for five years or more, it must be approved by both your county commissioners and the Department of State Treasurer, Local Government Commission.
A college may not have in effect at any time more than five state- funded contracts that exceed $100,000 or three years in length. A college may have any number of “smaller contracts” for $100,000 or less, or for three years or less, at any time.
No contract may contain a non-substitution clause that restricts the right of the trustees to:
Continue to provide a service or activity, or
Replace or provide a substitute for any property financed or
purchased by the contract.