1.10 Introduction to the Manual

 

PURPOSE:	The Financial Services Property Management Manual (PMM) provides direction for the management and control of property owned by or in the custody of the Arizona Board of Regents (ABOR) for the University of Arizona and to satisfy the requirements of the Federal Government regarding control over Government Property for which the University is responsible and accountable.
AUTHORITY:	Powers and duties of the University President, ABOR Policy 3-801 and 3-802 Authority below applies ONLY to Federal Property (acquisition dollars or title): 41 Code of Federal Regulations (CFR) Part 102 48 Code of Federal Regulations (CFR) Part 2 and Part 45 2 Code of Federal Regulations (CFR) Part 200 (“Uniform Guidance”)

I. INTRODUCTION

Property management is an essential University function, as a large portion of the University’s assets are comprised of equipment and other property. Sound and prudent property management practices at the department level must be guided by consistent and articulated property management policies and procedures.  In addition, the University must maintain compliance with Federal property standards as well as the requirements of other sponsors when the acquisition of equipment is authorized under a sponsored award.

II. TITLE

Unless retained by a sponsor, title to or ownership of all University property is vested in the Arizona Board of Regents.

III. RESPONSIBILITY

1. ABOR is responsible for all property to which it holds title. Custodial responsibility for other property rests with ABOR to the extent that it has explicitly agreed to accept responsibility therefor.
2. The Senior Vice President – Business Affairs has assigned responsibility for the management and control of inventorial equipment to the Vice President.
3. Financial Services Financial Management is responsible for the implementation and monitoring of property management policies and procedures.
4. Sponsored Projects Services (SPS) is responsible for providing sponsor titleholder information to the Property Management team and preparing required property reports to Government agencies and other sponsors.
5. The University property management system is audited regularly by ABOR and the Federal Office of Naval Research (ONR). These property audits are coordinated and supported by the Vice President in consultation with SPS, as appropriate.
6. The head of the department that has custody of the equipment (custodial department) and the Principal Investigator (PI) have the primary responsibility for the care, maintenance, record keeping, physical inventory, and control of equipment and other property. They must maintain up-to-date departmental records and, if Government or other sponsor-owned equipment or property is provided, initiate a Property Management Equipment Receipt Form as necessary to fully inform Financial Services and SPS of the receipt of the equipment. Additionally, they are responsible for notifying SPS when Government or other sponsor-owned equipment, property and deliverables are returned/shipped to the sponsor. Appropriate documentation (e.g., delivery receipts, shipping documents, etc.) must be provided so that SPS and Financial Services may properly carry out their functions regarding equipment and other property.
7. Financial Services and the custodial department are responsible for identifying, marking and recording property in the custody, possession or control of the University. In general, all inventorial equipment is marked with a property number, and a property record is created in the Capital Asset Management (CAM) module. It shall remain so identified as long as it is in the custody, possession, or control of the University. Assigned property numbers are recorded on all applicable receiving, shipping, and retirement documents, and any other records that may be a part of the CAM module. Such markings and identification are removed or obliterated from the equipment only when it is sold, scrapped, cannibalized or otherwise retired.
8. Custodial departments are to take physical inventories at least every two years (biennially). The Department Head or Principal Investigator should verify the existence, current utilization, and continued need for the equipment inventoried. These physical inventories are to be completed within 60 days (per policy 12.30). Property Management will verify the departmental inventories on the basis of statistical sampling, with all departments being sampled at least once every two years. Physical inventories are also performed by the custodial department and the Principal Investigator, upon termination or completion of a Government contract. Disposition instructions are requested from the agency by SPS, as required under the contract. If the equipment used on a terminating contract has been authorized for use in a follow-on contract, the requirement for a final inventory may be waived by the Government Property Administrator. The Arizona Board of Regents is responsible for all property to which it holds title. Custodial responsibility for other property rests with The Arizona Board of Regents to the extent that it has explicitly agreed to accept responsibility therefor.

IV. SCOPE

The Property Management Manual applies to property acquisitions belonging to or in the custody of ABOR for The University of Arizona, including property acquired/provided through sponsor funded contracts and grants for research, training, and public service. The Federal regulations and requirements cited in the PMM apply to property acquired with Government funds and to equipment furnished by the Government in support of contract performance or of a grant or cooperative agreement research program.

V. DEFINITIONS

Accessory Item - An item which facilitates or enhances the operation of equipment, but is not essential for its operation  (e.g., extra lenses for cameras or microscopes, keyboards and mice for computers, etc.).

Acquisition Cost - The total value of resources expended and committed to bring an asset up to intended and useful condition. Acquisition costs may include, but are not limited to, the cost of an item, shipping and handling, freight, sales or use taxes, in-transit insurance, installation/modification costs, training and consultant services related to acquiring an item, the fair market value of University assets given in exchange, and the present value of liabilities incurred or assumed. For donated capital assets, acquisition cost is its fair market value at the time of the donation (plus any acquisition related expenses such as freight and installation).

Acquisition Date - See In-Service Date.

Agency - An entity (i.e., organization, corporation, foundation, person) from which the University derives sponsor support through contracts or grants.

Auxiliary Item - An item without which the basic unit of equipment cannot operate (e.g., operating systems, batteries, etc.).

Award - Defined in 2 CFR 215.2 as - Financial assistance that provides support or stimulation to accomplish a public purpose.  Awards include grants and other agreements in the form of money or other property in lieu of money, by the Federal Government to an eligible recipient.  The term does not include: technical assistance, which provides services instead of money; other assistance in the form of loans, loan guarantees, interest subsidies, or insurance; direct payments of any kind to individuals; and, contracts which are required to be entered into and administered under procurement laws and regulations.

Cannibalization - The act of disassembling or dismantling equipment to the point of making the equipment unable to perform its intended use.  For Government property it is defined in 48 CFR 45.101 as - remov[ing] parts from Government property for use or for installation on other Government property.

Centrally Reportable Equipment (CRE) - Plant equipment, special test equipment (including components), special tooling, and non-flight space property (including ground support equipment) which is (a) generally commercially available and used as a separate item or component of a system, (b) valued at $1,000 or more (unless a lower threshold is specified elsewhere in the contract), and (c) identifiable by a manufacturer and model number. [This term applies only to equipment acquired on NASA and JPL contracts.]  NASA and JPL require sponsor approval for the acquisition of CRE.  All CRE must be issued an N- or A- property tag.

Component Parts - Items which are not complete in themselves and thus are not separately inventoried.

Contract - Defined in 2 CFR 215.2 as - A procurement contract under an award  or subaward, and a procurement subcontract under a recipient’s or subrecipient’s contract.

Contractor - The Arizona Board of Regents.

Contracting Office - Defined in 48 CFR 2.101 as - An office that awards or executes a contract for supplies or services and performs post-award functions not assigned to a contract administration office (except for use in Part 48, see also 48.001).  This definition relates only to the sponsor’s contracting office.

Contracting Officer - The duly authorized individual delegated by appropriate sponsor authority to enter into a contract, and thereafter, administer the contract, on behalf of the Federal Government or other sponsors. Defined in 48 CFR 2.101 as - A person with the authority to enter into, administer, and/or terminate contracts and make related determinations and findings. 

Custodial Department - A department or unit of the University having physical control of equipment (i.e., the using department, owning department or sponsoring department for a contract).

Deliverable - Equipment that is purchased, assembled or fabricated by the University for delivery to a sponsor or third party designated by the sponsor.

Discrepancies Incident to Shipment - Defined in 48 CFR 45.101 as – Any differences (e.g., count or condition) between the items documented to have been shipped and items actually received. Such deficiencies include loss, damage, destruction, improper status and condition coding, errors in identity or classification, and improper consignment.  For University titled equipment, please refer to the Procurement and Contracting Services (PACS) Policy (http://pacs.arizona.edu/manual_page06)

Equipment:

1. Federal - Defined in 48 CFR 45.101 as - A tangible item that is functionally complete for its intended purpose, durable, nonexpendable, and needed for the performance of a contract.  Equipment is not intended for sale, and does not ordinarily lose its identity or become a component part of another article when put into use.  Equipment does not include material, real property, special test equipment or special tooling. 
2. University:
   1. Capital - An item of non-expendable, tangible, personal property which has an aggregate acquisition cost or fair market value of $5,000.00 or more, is free standing, movable, complete in itself, does not lose its identity when affixed to or installed in other property and has a useful life greater than one year
   2. Non-Capital - CRE and other equipment are items of non-expendable, tangible, personal property which have an aggregate acquisition cost or fair market value between $1,000.00 and $4,999.99, are free standing, movable, are complete in themselves does not lose its identity when affixed to or installed in other property and have a useful life greater than one year.
   3. Exceptions:
      1. All vehicles must be tagged in order to track for insurance purposes.
      2. All weapons must be tagged.
      3. All computers must be tagged with an acquisition cost greater than $1,000.00.
3. Found Equipment - Equipment located and identified by either Property Management or a custodial department, with no record in UAccess Financials CAM module as capital or non-capital equipment, or was formerly reported as lost and unlocated.

Fabrication - See policy 5.10.   

Fair Market Value - The price at which a willing buyer and a willing seller settle a sale for a piece of equipment. Recent transactions or advertisements can be used as an estimate of fair market value. Defined in 41 CFR 102-36.40 as - The best estimate of the gross sales proceeds if the property were to be sold in a public sale.

General Purpose Equipment - Equipment which is not limited only to research, medical, scientific, or other technical purposes (e.g., computers, automobiles, etc.).

Government - United States of America, Federal Government, unless otherwise specified, as in "State Government".

Government-Furnished Equipment (GFE) - Equipment provided to the university by the Federal Government or Government contractor with title vested in the Federal Government.

Government Property - Defined in 48 CFR 45.101 as - All property owned or leased by the Government. Government property includes both Government-furnished property and contractor-acquired property. Government property includes material, equipment, special tooling, special test equipment, and real property.  Government property does not include intellectual property and software.  Such property acquired under grants and contracts with the University includes:

1. Government-Furnished Property (GFP) - Defined in 48 CFR 45.101 as - Property in the possession of, or directly acquired by, the Government and subsequently furnished to the contractor for performance of a contract.  Government-furnished property includes, but is not limited to, spares and property furnished for repair, maintenance, overhaul, or modification.  Government-furnished property also includes contractor-acquired property if the contractor-acquired property is a deliverable under a cost contract when accepted by the Government for continued use under the contract.
2. Contractor-Acquired Property - Defined in 48 CFR 45.101 as - Property acquired, fabricated, or otherwise provided by the contractor for performing a contract and to which the Government has title.
3. Excess Personal Property - Defined in 48 CFR 2.101 as - Any personal property under the control of a Federal agency that the agency head determines is not required for its needs or for the discharge or its responsibilities.
4. Surplus Property - Defined in 48 CFR 2.101 as - Excess personal property not required by any Federal agency as determined by the General Services Administration (GSA). (See 41 CFR 102-36.40)

Grant - Defined in 41 CFR 102-36.40 as - A type of assistance award and a legal instrument which permits a Federal agency to transfer money, property, services or other things of value to a grantee when no substantial involvement is anticipated between the agency and the recipient during the performance of the contemplated activity.

Grantee - The Arizona Board of Regents for the University of Arizona.

Idle Equipment - Equipment that currently has no known use for the department, contract, or grant.

In-Service Date - For Federal and Government titled assets, it is the date the equipment or material is received by the University.  For University and other titled assets, it is the payment date.

Loan Equipment - Equipment which is:

1. Borrowed by the University from an external agency
2. Loaned out by one University department to another
3. Loaned out by the University to an external agency or individual

Material - Defined in 48 CFR 45.101 as - Property that may be consumed or expended during the performance of a contract, component parts of a higher assembly, or items that lose their individual identity through incorporation into an end-item. Material does not include equipment, special tooling, special test equipment or real property. Note: Material does include assemblies, components, parts, raw and processed materials, and small tools and supplies that may be consumed in normal use.

Personal Property - Any movable item subject to ownership; material but not real property.

Personally Owned Equipment - Equipment that is not owned or in the custody of the University and is owned by a University employee or other private party.

Principal Investigator (PI) - The academic or administrative staff member responsible for initiating and conducting a sponsor funded research, training, or Public Health Service (PHS) project. The individual may also be known as the Project Director or Project Administrator.

Property - Defined in 2 CFR 215.2 as - Means, unless otherwise stated, real property, equipment, intangible property, and debt instruments.
Note: Property also includes intangible property.

Property Administrator - Defined in 48 CFR 45.101 as - An authorized representative of the contracting officer appointed in accordance with agency procedures, responsible for administering the contract requirements and obligations relative to Government property in the possession of a contractor.

Property Records - CAM

Real Property - Defined in 41 CFR 102-71.20.

Salvage Value - Defined by GASB as the estimated fair value of a capital asset, infrastructure or otherwise, remaining at the conclusion of its estimated useful life.

Scrap - Consists of recyclable material left over from product manufacturing and consumption, such as parts of vehicles, building supplies, and surplus materials.

Special Purpose Equipment - Equipment which is used only for research, medical, scientific, or other technical purposes, as contrasted with General Purpose Equipment. Equipment that is specifically designed for scientific purposes is special purpose equipment. Equipment that is not specifically designed for scientific purposes still may qualify as special purpose equipment if its use for scientific purposes makes it unusable for general purposes (e.g., a refrigerator used for storing radioactive or hazardous materials).

Special Test Equipment - Defined in 48 CFR 2.101 as - Either single or multipurpose integrated test units engineered, designed, fabricated, or modified to accomplish special purpose testing in performing a contract. It consists of items or assemblies of equipment including foundations and similar improvements necessary for installing special test equipment, and standard or general purpose items or components that are interconnected and interdependent so as to become a new functional entity for special testing purposes. Special test equipment does not include material, special tooling, real property, and equipment items used for general testing purposes or property that with relatively minor expense can be made suitable for general purpose use.

Special Tooling - Defined in 48 CFR 2.101 as - Jigs, dies, fixtures, molds, patterns, taps, gauges, and all components of these items including foundations and similar improvements necessary for installing special tooling, and which are of such a specialized nature that without substantial modification or alteration their use is limited to the development or production of particular supplies or parts thereof or to the performance of particular services. Special tooling does not include material, special test equipment, real property, equipment, machine tools, or similar capital items. Sponsoring Department - A department or unit of the University, responsible for the administration of a sponsor funded project.

State - State of Arizona.

Surplus Equipment - Equipment currently not in service, with no anticipated future use, and in the custody of Surplus Property Management (SPM).

Tag - To place a University of Arizona property control number on a piece of equipment.

University - The Arizona Board of Regents for the University of Arizona.

University Property - Property to which title is vested in the University whether secured with general University funds or funds derived from sponsors.

VI. ORDER OF AUTHORITY

In the event of an inconsistency or conflict, applicable law and ABOR policies supersede University policies and University policies supersede college, department or similar unit bylaws, policies, or guidelines.

Property policies, rules, or regulations set forth in grants or contracts to which property was acquired or accountable to supersede the policies and procedures contained within the PMM.

The University reserves the right to add, amend, or revoke any of the contained rules, policies, regulations, and instructions or incorporate additional ones, with or without notice, as circumstances or the good of the University community may require.