Source: http://www.twc.state.tx.us/financial-manual-grants-contracts-chapter-13-property
Timestamp: 2018-03-22 15:41:29
Document Index: 218021415

Matched Legal Cases: ['§97', '§92', '§3015', '§97', '§92', '§97', '§92', '§22', '§3015', '§667', '§98', '§97', '§92', '§3015', '§97', '§92', '§3015', '§97', '§92', '§3015', '§ 277', '§97', '§92', '§3015', '§97', '§92', '§3015', '§277', '§97', '§92', '§3015', '§277', '§97', '§92', '§3015', '§22', '§277', '§97', '§92', '§3015', '§22', '§277', '§97', '§92', '§3015', '§277', '§97', '§92', '§3015', '§277', '§97', '§92', '§3015', '§3015', '§3015', '§277', '§97', '§92', '§3015', '§97', '§92', '§3015', '§277', '§97', '§92', '§3015', 'art 401', '§277', '§97', '§92', '§3015', '§277', '§3015', '§97', '§92', '§403', '§403', '§403', '§403', '§ 22']

Financial Manual for Grants & Contracts Chapter 13: Property — TWC
Financial Manual for Grants & Contracts Chapter 13: Property
Acquisition & Use of Real Property
Disposition of Real Propery
Acquisition & Use of Equipment
Propery Records
Disposition of Equipment < $5,000
Disposition of Equipment ≥ $5,000
Federally-Ownded Property
Property Inusrance
Each Contractor must develop and maintain a property accounting system that accounts for all property in accordance with established property standards. This chapter compiles the applicable federal, state and agency requirements governing the acquisition, management and disposition of property acquired by a Contractor using funds administered by the Agency. In the event of conflict between these standards and federal statute or regulations, the federal statute or regulation will apply.
In addition to the property management and disposition requirements in this chapter, Contractors must comply with appropriate procurement and record retention standards discussed in this manual. Prior approval requirements for the acquisition and disposition of property can be found in Sections 13.3, 13.4, 13.5 and 13.12 of this manual. Prior approval requirements for capital leases are provided in Section 13.17 of this manual.
Title to property will vest in the Contractor that acquired the property, subject to the Contractor's compliance with applicable property requirements.
Title to property acquired by a Contractor under a federally sponsored award will vest in the Contractor as long as the Contractor uses the property for the authorized purpose, and complies with the applicable acquisition, management, and disposition Authorities listed below. This applies to:
Equipment and other non-expendable personal property
Supplies and other expendable personal property
OMB Circular A-110 §__.32(a)
29 CFR §97.31(a)
45 CFR §92.31(a)
7 CFR §3015.162
UGMS Part III §__.31(a)
OMB Circular A-110 §__.34(a)
29 CFR §97.32(a)
45 CFR §92.32(a)
UGMS Part III §__.32(a)
OMB Circular A-110 §__.35(a)
29 CFR §97.33(a)
45 CFR §92.33(a)
UGMS Part III §__.33(a)
OMB Circular A-110 §__.36(e)
A property control officer must be designated when specifically required by contract, program or administrative requirement. It is recommended to all other Contractors.
Boards, and other Contractors that are specifically required by a contract, program or administrative requirement, must designate a Property Control Officer. Other Contractors are also encouraged, but not required, to designate a Property Control Officer. The Agency-Board Agreement requires that the Property Control Officer:
Maintain control of all acquired real and non-expendable personal property
Ensure that a physical inventory is conducted
Coordinate with the Agency to conduct an annual physical inventory of any Agency loaned state property in the Contractor's possession
In addition, the Property Control Officer is generally the individual that an organization assigns responsibility for maintaining property records and for corresponding with the Agency regarding prior approval requirements for property acquisition and disposition. The Property Control Officer generally oversees the conduct of physical inventories and any investigation of missing property.
Agency-Board Agreement §§22.6 and 22.7
Real property shall only be acquired when allowable, and with the prior written approval of the Agency. If acquired, real property must be used for the originally authorized purpose as long as needed.
Prior written approval must be obtained from the Agency before purchasing real property. Prior written approval must be requested by completing Form 7100 and submitting it by mail or fax to the Agency's designated contract manager. Approval is valid for 90 days after issuance of the concurrence letter from the Agency. No later than 30 days after final acquisition of the property, Form 7200 must be submitted to the Agency. Forms 7100 and 7200 are provided on the TWC Financial and Grant Information page at the Agency’s website.
Forms 7100 and 7200 are required regardless of the unit acuisition cost (UAC) or fair market value (FMV) of the real property, and must be submitted to the Agency even if the property that is being acquired is replacemt property. Contractors’ subcontractors must submit forms through Contractors.
Once acquired, real property must be used for the originally authorized purpose as long as it is needed for that purpose, and neither it nor its interests may be disposed of or encumbered during that time. When no longer needed for the originally authorized purpose, real property must be disposed of in accordance with the requirements in Section 13.4 of this manual. However, property subject to Office of Management and Budget Circular A-110 and 7 CFR §3015.163 may be used in other programs if prior written approval is obtained from the Agency. Prior written approval may be obtained by written request to the Agency’s designated contract manager. In these cases, use in other projects is limited to other federally sponsored programs, or programs whose purposes are consistent with those of the legislature under which the original award was made.
Program Specific Considerations:
Workforce Investment Act (WIA) Title I. WIA Title I funds may not be used to acquire real property. Repairs, renovations, alterations and capital improvements are allowable costs when they are necessary to meet required physical and programmatic accessibility requirements, and are not otherwise restricted by 20 CFR §667.260(b).
Child Care and Development Funds (CCDF). CCDF funds may not be used to acquire real property or make permanent improvements to any facility or building. Minor remodeling and upgrades are allowable costs when necessary to meet child care health, safety and other requirements. The regulations do not define the scope of a minor remodel or upgrade.
Apprenticeship. Apprenticeship funds may not be used to acquire real property. The costs of remodeling buildings or facilities are unallowable uses of Apprenticeship funds.
45 CFR §98.54(b)
OMB Circular A-110 §__.32(a)-(b)
29 CFR §97.31(b)
45 CFR §92.31(b)
7 CFR §3015.163(a)-(b)
UGMS Part III §__.31(b)
When no longer needed, real property must be disposed of in accordance with written instructions that have been requested from and provided by the Agency.
Real poperty may only be disposed of when it is no longer needed for an authorized purpose. Prior written approval must be obtained from the Agency before disposing of real property. Prior written approval must be requested by completing Form 7300 and submitting it by mail or fax to the Agency’s designated contract manager. The Contractor must dispose of real property that is no longer needed in accordance with the written instructions issued by the Agency. No later than 30 days after final disposition, Form 7400 must be submitted to the Agency’s designated contract manager. Forms 7300 and 7400 are provided on the TWC Financial and Grant Information page at the Agency’s website.
Forms 7300 and 7400 are required regardless of the unit acuisition cost (UAC) or fair market value (FMV) of the real property, and must be submitted to the Agency even if the property will be used to acquire replacement property. Contractors’ subcontractors must submit forms through Contractors.
Disposition. The Agency will generally instruct the Contractor to dispose of the property in one of three ways:
Retain Title – The Contractor retains title and compensates the funding source for its equity share of the property’s current FMV. Compensation may be provided as an offset to expenditures on the expenditure report if the contract is active, or by check or money order if the contract is closed. If the property will be retained and used to acquire replacement property under the same program, the net proceeds from the disposition may be used to offset the cost of the replacement property.
Sell – The Contractor sells the property, obtaining the highest possible return, and compensates the funding source for its equity share in the property’s net sale proceeds. Compensation may be provided as an offset to expenditures on the expenditure report if the contract is active, or by check or money order if the contract is closed. If sold, the Contractor must have sales procedures that provide for competition to the extent practicable and for obtaining the highest possible return.
Transfer Title – The Contractor transfers title to the awarding agency, or to a third party that is either designated or approved by the awarding agency. Any funding source that contributed to the acquisition of the property must be compensated for its equity share in the property’s current FMV.
Disposition and Replacement Property:
OMB Circular A-110 §__.32(c)
29 CFR §97.31(c)
45 CFR §92.31(c)
7 CFR §3015.163(c)
UGMS Part III §__.31(c)
OMB Circular A-110 §__.24(g)
29 CFR §97.25(f)
45 CFR §92.25(f)
7 CFR §3015.42
UGMS Part III §__.25(f)
Equipment shall only be acquired with the prior approval of the Agency. Equipment acquired with federal or state funds must be used for an authorized purpose as long as needed, in accordance with applicable administrative requirements.
Prior written approval must be obtained from the Agency before purchasing equipment. Prior written approval must be requested by completing Form 7100 and submitting it by mail or fax to the Agency’s designated contract manager. Approval is valid for 90 days after issuance of the concurrence letter from the Agency. No later than 30 days after completing the final acquisition of the approved property Form 7200 must be submitted to the Agency. Forms 7100 and 7200 are provided on the TWC Financial and Grant Information page at the Agency's website.
Forms 7100 and 7200 are required for all equipment purchases, and must be submitted to the Agency even if the property that is being acquired is replacement property. Contractors’ subcontractors must submit forms through Contractors.
The federal or state government has an interest in equipment that was acquired with federal or state funds, respectively. As long as the federal or state government retains an interest, equipment that was purchased using federal or state funds may not be used to provide services for a fee that is less than private companies normally charge for equivalent services unless specifically authorized by federal or state statute. The federal or state government will retain an interest in the property until such time as it expressly releases its interest or the property is disposed and the government is compensated for its equity share in the property. Other requirements for equipment use follow.
Use for the Originally Authorized Purpose. Once acquired, equipment must be used for the originally authorized purpose(s) as long as needed, even if federal support is discontinued. While needed for the originally authorized purpose, the equipment may not be encumbered for any other use.
Available for Use by Other Programs/Shared Use. If the equipment is used in the originally authorized program less than full-time, it must be made available to other programs as long as:
Use by other programs will not interfere with using the equipment for its originally authorized purpose
First preference is given to activities that are sponsored by the same federal agency as the source that funded the equipment acquisition
Second preference is given to activities that are sponsored by other federal agencies* (*Note: second preference applies to nongovernmental entities only.)
User fees are generally appropriate when equipment is made available to other programs. User fees must be treated as program income (see Chapter 5 of this manual).
Use for Other Programs. When equipment is no longer needed for the originally authorized purpose, it may be used for other activities that are either currently or were previously supported by a federal agency. See considerations for nongovernmental entities and for the Food Stamp Employment and Training program for requirements regarding the order of priority. Other Contractors should follow their organizations’ policies regarding order of priority when using equipment for other programs.
Entity Specific Consideration:
Nongovernmental Entities. Regarding the order of priority when equipment is no longer needed for the authorized purpose but can be used in other programs, nongovernmental entities are required under Office of Management and Budget Circular A-110 to give first preference for the use of equipment to activities that are sponsored by the same federal agency as the award that was originally used to acquire the equipment. Second preference must be given to activities sponsored by other federal awarding agencies.
For a separate entity specific requirement applicable to nongovernmental entities, see Available for Use by Other Programs/Shared Use in this section. It provides the order of priority required when making property that is still needed for the authorized purpose available for use in other programs.
Supplemental Nutrition Assistance Program (SNAP) Employment and Training (E&T). Regarding the order of priority when equipment is no longer needed for the authorized purpose but can be used in other programs, recipients of SNAP E&T funds are required to give first preference for the use of equipment to activities sponsored by the same U.S. Department of Agriculture (USDA) awarding agency (Food and Nutrition Service). Second preference must be given to activities sponsored by another USDA awarding agency (other programs funded through the USDA). Third preference must be given to other federal awarding agencies.
7 CFR § 277.13(b)(2)(i)-(ii) and (e)(2)
OMB Circular A-110 §__.34(c)-(d)
29 CFR §97.32(c)(1)-(2)
45 CFR §92.32(c)(1)-(2)
7 CFR §3015.166
UGMS Part III §__.32(c)(1)-(2)
OMB Circular A-110 §__.34(b )
29 CFR §97.32(c)(3)
45 CFR §92.32(c)(3)
UGMS Part III §__.32(c)(3)
Property records that meet or exceed the minimum standards established by applicable administrative requirements must be maintained for all equipment that was acquired in whole or in part with federal or state funds until such time as transfer, replacement or disposal occurs.
Property records for equipment must meet the minimum standards below. Each organization should assign responsibility for maintaining current and accurate property records to a specific individual, such as a Property Control Officer. Section 13.2 of this manual provides additional information on the duties of the Property Control Officer.
Property Description. Each item of equipment should be described in terms of the unique characteristics of that particular item of property. The property description of equipment acquired with Supplemental Nutrition Assistance Program (SNAP) Employment and Training (E&T) funds is expressly required by regulation to include the manufacturer’s serial number.
Identification Number. Each item of equipment must be identifiable in the property records by an identification number; i.e., a manufacturer’s serial number, federal or national stock number, model number, or other identification number. If the Contractor uses a method such as tagging, the tag number should be readily visible and difficult to remove without considerable or intentional means, and it should not be re-used, even if a property item has been deleted from the inventory.
Funding Source. All funding sources used to acquire the equipment must be identified in the property records. nongovernmental entities must also include the federal award number, where applicable.
Titleholder. With the exception of property purchased with SNAP E&T funds, property records for equipment purchased in whole or in part with federal or state funds must identify the entity that holds title to the equipment. Regulations at 7 CFR §3015.169 do not expressly require this information for property acquired with SNAP E&T funds.
Acquisition Date and Cost. The property records must include the equipment’s acquisition date and acquisition cost.
Percentage of Federal or State Participation in the Cost of the Property. Except for property that was purchased by a nongovernmental entity or with SNAP E&T funds, the percentage share of the acquisition cost of equipment that was paid under a federal or state award must be included in the property records. Property records for property that was purchased by a nongovernmental entity or with SNAP E&T funds are not required to include the percentage, but must at a minimum, include information that can be used to calculate the percentage of participation.
Location, Use and Property Condition. Except for property that was purchased by a nongovernmental entity, the location, use and condition of the property must be included in the property records. Nongovernmental entities are required to include location and condition, but not use. Additionally, the property records for SNAP E&T property must include the location, use and condition of the property, as well as, the date that such information was reported. Location refers to the physical location of the property. Use refers to whether or not the item of property is being actively used for an authorized purpose. Condition refers to the condition of the property, such as, excellent, good, fair or poor.
Disposition Data. The property records must include data that is relevant to the ultimate disposition of the equipment, including the date of transfer, replacement or disposal of the property; and the sale price, trade-in value, or current per unit fair market value, as applicable.
Nongovernmental Entities. See Funding Source, Percentage of Federal or State Participation in the Cost of the Property and Location, Use and Property Condition above.
SNAP E&T. See Property Description, Titleholder, Percentage of Federal or State Participation in the Cost of the Property and Location, Use and Property Condition above.
7 CFR §277.13(d)(1)
OMB Circular A-110 §__.34(f)(1)
29 CFR §97.32(d)(1)
45 CFR §92.32(d)(1)
7 CFR §3015.169(a)
UGMS Part III §__.32(d)(1)
An annual physical inventory must be conducted and reconciled with property records for equipment that was purchased in whole or in part with federal or state funds.
A physical inventory of equipment that was purchased in whole or part with federal or state funds must be taken annually, and the results must be reconciled with property and accounting records. See Entity and Program Specific Considerations below regarding requirements that are unique to Boards, nongovernmental entities and equipment acquired using Supplemental Nutrition Assistance (SNAP) Employment and Training (E&T) funds.
In order to maintain sufficient internal control over property, the individual assigned to conduct the inventory should have no responsibilities for entering or reporting of the property. For this reason, the Property Control Officer should ensure that the required inventory is performed, but should generally not be the individual that conducts the physical inventory. Controls are further improved when a team of two or more individuals conducts the physical inventory.
Interim Inventories. While a physical inventory is required at least annually, Contractors may also conduct interim inventories. Contractors may use sampling techniques, such as statistical or dollar sampling when conducting interim inventories, but are discouraged from using such techniques when conducting the required annual inventory.
Local Workforce Development Boards. The Agency-Board Agreement requires Boards to include real property when conducting the physical inventory.
Nongovernmental Entities. Regulations applicable to nongovernmental entities specifically require that the existence, current use, and continued need for the property be verified during the annual physical inventory. The same regulations are also specific in that any differences between the quantities determined in the physical inventory and those in the accounting records must be investigated to determine the cause of the differences.
SNAP E&T. Regulations governing equipment purchased using SNAP E&T funds specifically require that the existence, current use, and continued need for the property be verified during the physical inventory. The same regulations are also specific in that any differences between the quantities determined in the physical inventory and those in the accounting records must be investigated to determine the cause of the differences.
7 CFR §277.13(d)(2)
OMB Circular A-110 §__.34(f)(3)
29 CFR §97.32(d)(2)
45 CFR §92.32(d)(2)
7 CFR §3015.169(b)
UGMS Part III §__.32(d)(2)
Agency-Board Agreement §22.6
Adequate controls must be implemented to safeguard equipment that was purchased in whole or in part with federal or state funds until such time as disposition occurs.
All Contractors must take reasonable precautions to ensure that equipment is properly maintained, accounted for, and protected from damage, loss, unreasonable deterioration and theft. Contractors are advised to consider the following and any additional controls necessary to safeguard the property:
Maintain adequate and current property records that allow the Contractor to locate any property in its possession at all times, whether the property is located on-site or off-site
Provide a secure building and coordinate between the security function and the Property Control Officer, especially regarding security violations or changes affecting personal property
Have a written policy for checking out property that requires employees to sign for property in their possession
Contractors are not required to notify the Agency when property acquired under a contract with the Agency is lost, damaged or stolen; however, the Contractor must conduct and fully document an investigation. When appropriate, law enforcement authorities should be notified, a police report should be obtained and maintained for Contractor records, and the Contractor’s insurance provider should be notified. For more information on property insurance, see Section 3.18 of this manual.
If the federal or state government owns the property, the appropriate government personnel should be notified and the appropriate procedures to report and investigate the property must be taken.
7 CFR §277.13(d)(3)
OMB Circular A-110 §__.34(f)(4)
29 CFR §97.32(d)(3)
45 CFR §92.32(d)(3)
7 CFR §3015.169(c)
UGMS Part III §__.32(d)(3)
Agency-Board Agreement §22.2
Adequate maintenance procedures must be developed to keep equipment that was purchased in whole or in part with federal or state funds in good condition until disposition occurs.
Contractors must develop adequate maintenance procedures to keep equipment in good condition, or in a condition that is similar to the condition of the property when it was acquired. It is recommended that Contractors follow manufacturer's recommended maintenance schedules.
7 CFR §277.13(d)(4)
OMB Circular A-110 §__.34(f)(5)
29 CFR §97.32(d)(4)
45 CFR §92.32(d)(4)
7 CFR §3015.169(d)
UGMS Part III §__.32(d)(4)
Proper sales procedures must be developed when the sale of equipment that was purchased in full or in part with federal or state funds is authorized or required.
Contractors who are authorized or required to dispose of equipment by selling it must develop sales procedures that require the highest possible return on the property. Highest possible return should be defined and determined by each Contractor. Regulations for property purchased by nongovernmental entities or using Supplemental Nutrition Assistance Program Employment and Training funds also require that procedures provide for competition to the extent practicable.
7 CFR §277.13(d)(5)
OMB Circular A-110 §__.34(f)(6)
29 CFR §97.32(d)(5)
45 CFR §92.32(d)(5)
7 CFR §3015.169(e)
UGMS Part III §__.32(d)(5)
When no longer needed, equipment that was purchased using federal or state funds and that has a current per unit fair market value less than $5,000 may be retained, sold, or otherwise disposed of without further compensation to the funding source.
When equipment with a current per unit fair market value (FMV) less than (<) $5,000 is no longer needed for an authorized purpose, the equipment may be retained, sold, or otherwise disposed of with no further obligation to the awarding agency. The Contractor is not required to request prior written approval to dispose of such property from the Agency; to notify the Agency when final disposition of such property is complete; or to compensate the funding source for its interest in such property.
7 CFR §277.13(b)(2)(ii)(A) and (b)(3)(i)
OMB Circular A-110 §__.34(g
29 CFR §97.32(e)(1)
45 CFR §92.32(e)(1)
7 CFR §3015.168, §3015.191 and §3015.193
UGMS Part III §__.32(e)(1)
When no longer needed, equipment that was purchased using federal or state funds and that has a current per unit fair market value of $5,000 or more must be disposed of in accordance with written instructions requested from and provided by the Agency.
When equipment with a current per unit fair market value (FMV) of $5,000 or more (≥) is no longer needed for an authorized purpose, prior written approval to dispose of the property must be obtained from the Agency. Prior written approval must be requested by completing Form 7300 and submitting it by mail or fax to the Agency’s designated contract manager. The property must be disposed of in accordance with the written instructions provided by the Agency in response to the Form 7300 request. No later than 30 days after final disposition, Form 7400 must be submitted to the Agency’s designated contract manager. Methods for determining per unit FMV must be documented, kept on file and made available to the Agency upon request. Forms 7300 and 7400 are provided on the TWC Financial and Grant Information page at the Agency’s website.
Except as required by the Program Specific Considerations below, Forms 7300 and 7400 are required for all equipment with a current per unit FMV ≥ $5,000, and must be submitted to the Agency even if the property being disposed will be used to acquire replacement property. Contractors’ subcontractors must submit the forms through Contractors.
Disposition. The Agency will generally instruct the Contractor to dispose of the property in one of two ways: retain title or sell. However, the federal or state awarding agency may also reserve the right to transfer title to the government or an eligible third party. If transferred, the Contractor must be paid an amount calculated by applying the percentage of participation in the purchase to the current FMV of the property.
Retain Title – The Contractor keeps the property for other uses, and compensates the funding source for its equity share of the property’s current FMV. Compensation may be provided as an offset to expenditures on the expenditure report if the contract is active, or by check or money order if the contract is closed. If the property will be retained and used to acquire replacement property under the same program, it may be used as a trade-in for the replacement property, or the sale proceeds may be used to offset the cost of the replacement property.
Sell – The Contractor sells the property and compensates the funding source for its equity share in the property's net sale proceeds. Compensation may be provided as an offset to expenditures on the expenditure report if the contract is active, or by check or money order if the contract is closed.
7 CFR §277.13(b)(3)(ii)
OMB Circular A-110 §__.34(g)
29 CFR §97.32(e)
45 CFR §92.32(e)
7 CFR §3015.168
UGMS Part III §__.32(e)(2)
OMB Circular A-110 §__.34(e)
29 CFR §97.32(c)(4)
45 CFR §92.32(c)(4)
7 CFR §3015.167
UGMS Part III §__.32(c)(4)
Supplies purchased with federal or state funds may be acquired and disposed of without prior written approval from the Agency; however, any residual inventory of unused supplies at the end of an award must be disposed of as appropriate for the aggregate fair market value of the property.
Contractors are not required to obtain prior written approval to acquire or dispose of supplies. When an award ends or is otherwise terminated, any residual inventory of unused supplies must be disposed of as required for the fair market value (FMV) shown below.
FMV < $1,000. If the unused supplies have an aggregate FMV less than $1,000 upon termination of the award, the supplies may be disposed of without any further obligation to the awarding agency.
FMV between $1,000 and $5,000. If the unused supplies have an aggregate FMV between $1,000 and $5,000 upon termination of the award, the awarding agency may, at its discretion, direct the Contractor to sell the unused supplies and compensate the awarding agency for its equity share in the current market value or net sale proceeds. Regardless of whether the Contractor is directed to sell the supplies, it must compensate the awarding agency for its equity share of the current FMV or net sale proceeds of the property.
FMV > $5,000. If the unused supplies have an aggregate FMV more than $5,000 upon termination of the award, and are not needed for any other federal or state award, the awarding agency must be compensated for its equity share in the FMV or net sale proceeds of the property.
Nongovernmental Entities. Unless specifically authorized by federal statute, nongovernmental entities may not use supplies purchased with federal funds to provide services to external organizations for a fee that is less than private companies charge for equivalent services.
7 CFR §277.13(e)(3)-(4)
OMB Circular A-110 §__.35
29 CFR §97.33(b)
45 CFR §92.33(b)
7 CFR §3015.171
UGMS Part III §__.33(b)-(c)
Intangible property that was acquired under a federally sponsored award must be made available to the federal sponsoring agency, and parties authorized by that agency.
In general, when a federal funding source is used to acquire intangible property, the federal awarding agency has a royalty-free, nonexclusive and irrevocable right to reproduce, publish, or otherwise use the work for its purposes, or for the purposes of any parties authorized by the agency. Specific requirements for some types of intangible property are discussed below:
Copyrights. Contractors have the right to copyright work that was developed or for which ownership was purchased under a federally sponsored award.
Patents and Inventions. Patents and inventions produced by nongovernmental entities with federal funds or by other entities using Supplemental Nutrition Assistance Program Employment and Training funds must be treated in accordance with the government-wide regulations that were developed by the U.S. Department of Commerce and published at 37 CFR Part 401.
Data. The federal awarding agency has rights to access data that is first produced under a federally sponsored award to a nongovernmental entity.
Research Data. Research data produced by a nongovernmental entity is subject to compliance with the Freedom of Information Act (FOIA). The Contractor must provide any data requested under the FOIA to the federal government within a reasonable timeframe.
7 CFR §277.13(g)
OMB Circular A-110 §__.36(a)
29 CFR §97.34
45 CFR §92.34
7 CFR §3015.175(b)
UGMS Part III §__.34
OMB Circular A-110 §__.36(c)
OMB Circular A-110 §__.36(d)
7 CFR §277.13(f)
OMB Circular A-110 §__.36(b)
7 CFR §3015.175(a)
Federally-owned property must be managed and disposed of in accordance with applicable administrative requirements.
If a Contractor is provided with federally-owned property, title to the property remains vested in the federal government. The federally-owned property must be managed as required by the federal agency, and an annual inventory listing of federally-owned property must be submitted to the federal agency that provided the property. When the property is no longer needed, the Contractor must request disposition instructions from the federal agency that provided the property.
If a federal awarding agency vests title to federally-owned property in the Contractor without any further obligation to the federal government, the property is "exempt property." Title to exempt property may vest in the Contractor on a conditional or unconditional basis depending upon the decision of the federal agency.
Nongovernmental Entities. Nongovernmental entities must identify and indicate any federally-owned equipment in its possession in its property records. It may also make federally-owned equipment available for use for other nonfederal activities, but only if specifically authorized by the federal government.
OMB Circular A-110 §§__.33 and __.34(d) and (f)
29 CFR §97.32(f)
45 CFR §92.32(f)
UGMS Part III §__.32(f)
State-owned property must be accounted for, managed, and disposed of in accordance with applicable state laws and rules.
State-owned property is property that was acquired by the state, or for which title has otherwise vested in the state. It does not include property purchased by Contractors under a federal or state sponsored award, unless title to the property is subsequently transferred to the state. In some instances, the Agency may loan state-owned property to a Contractor. If a Contractor possesses loaned state property, it must manage and account for the property in accordance with pertinent requirements published in the Texas Government Code and by the state Comptroller. These requirements are discussed below. The forms identified below are available on the Agency’s intranet site by clicking the respective form links. Entities that do not have access to the intranet may contact the Agency’s Property Manager or email Fiscal.TA@twc.state.tx.us. Contact information for the Agency’s Property Manager is provided in Appendix E to this manual.
Property Manager. In accordance with Texas Government Code §403.273(a)-(c), each state agency, must designate a Property Manager, or Property Control Officer. The Agency’s Property Manager is responsible for the loan of any Agency-owned state property to the Agency’s Contractors.
Loan Requests. Contractors must submit a written request on Contractor letterhead to the Agency’s Property Manager. The request should describe, in as much detail as possible, the type of property that the Contractor would like to use. The Property Manager reviews the request and responds to the Contractor. If any Agency-owned state property is available for use by the Contractor, the Agency’s Property Manager will initiate a loan to the Contractor. When the Agency loans state property to a Contractor, the Contractor must provide a written receipt using TWC Form F-68 to the Agency’s Property Manager. Form F-68 is available on the Agency’s intranet . The Agency’s intranet can be accessed by Boards and Agency personnel.
Identification of Inventory. Texas Government Code §403.271(e) and the State Comptroller require the Agency to mark and identify all state property in its possession. Loaned property remains state property when loaned to a Contractor. Before accepting state property from the Agency, the Contractor should verify that the property has been marked as state property. Neither the Agency nor the Contractor may remove the marking for as long as the item is state property.
Property Inventory. The Agency is required to include loaned property in its annual physical inventory. As such, the Agency requires Contractors that possess Agency loaned state property to conduct an annual physical inventory of the property. When feasible, Contractors are encouraged to include state property in the organization’s regularly scheduled physical inventory, and to coordinate the physical inventory of state property with the Agency’s scheduled inventory, which usually occurs during the summer months. Sampling methods may not be used to conduct the annual physical inventory of state property.
Upon completion of the annual inventory, the Contractor must submit the following forms to the Agency’s Property Manager: the Contractor’s inventory report, the Contractor’s certification that the inventory report is accurate, and if applicable, TWC Form F-200 to report discovered property. Contractors may use their own formats to report the physical inventory and to certify its accuracy. Contractors must use TWC Form F-200 to report discovered property. Form F-200 is available on the Agency’s intranet . The Agency’s intranet can be accessed by Boards and Agency personnel.
Securing Assets. The Agency must take all precautions to ensure that assets are tracked and secured to prevent theft, loss, damage, or misuse of assets. Accordingly, when a Contractor takes possession of Agency loaned state property, it must implement similar controls. The Agency and the Contractor should be able to locate Agency loaned state property upon request.
Contractors should comply with similar requirements as state agencies when checking out state property to its employees. If any Contractor employees "check out" Agency loaned state-owned property from the Contractor the employees may only use the property for business purposes. Additionally, the Agency is required to have a written policy for checking out personal property, and to require each employee to sign for any property when it is checked out. Contractors possessing loaned state property should develop a similar policy.
Missing Property. Texas Government Code §403.276(a)-(b) requires that the Agency immediately notify the State Attorney General when it has reasonable cause to believe that any state property in the agency's possession has been lost, destroyed, or damaged through the negligence or fault of any state official or employee. When a Contractor determines that Agency loaned state property is missing, or has been either damaged or destroyed, it must complete TWC Form F-67. The completed form must be submitted to the Agency’s Property Manager allowing enough time for the Agency to submit the report to the Attorney General’s office within 72 hours from the time that the Contractor first determined that the property was missing. Form F-67 is available on the Agency’s intranet . The Agency’s intranet can be accessed by Boards and Agency personnel.
Stolen Property. When a Contractor suspects that Agency loaned state property has been stolen, it must report the theft to the proper police authorities within 48 hours of identifying the theft. When the police report is available, the Contractor must obtain a copy and attach it to TWC Form F-67. Both the police report and Form F-67 must be submitted to the Agency’s Property Manager as soon as the police report has been obtained.
Liability for Property Loss. When the Agency loans state property to a Contractor, or an individual in the Contractor's organization, either or both parties may be pecuniary (financially) liable for any disappearance, deterioration, damage or destruction of the property under certain circumstances. Under Texas Government Code §403.275, if the head of an organization, any of its employees, or its property manager fail to exercise reasonable care for the property’s safekeeping, or maintenance and service requirements. A pecuniary liability may also be enforced if the loss resulted from either an act of neglect or intentional wrong doing by any official or employee of the organization.
Disposition/Surplus Property. When a Contractor no longer needs to use Agency loaned state property, it must useTWCForm F-205 to notify the Agency’s Property Manager. If the Agency has no other need for the property it becomes surplus or salvage property, depending on its condition. The Agency will instruct the Contractor in the disposition of the property. Form F-205 is available on the Agency’s intranet . The Agency's intranet can be accessed by Boards and Agency personnel.
Record Retention. Contractors should maintain records of Agency loaned state property for no less than three fiscal years after releasing the property back to the Agency.
Chapter 403, Government Code
Costs for leased or rental property must conform to applicable cost principles for rental costs. Such property must be procured in accordance with applicable procurement requirements.
Contractors may use federal or state funds to lease property to the extent that the lease is allowable in accordance with applicable cost principles. No prior approval is required from the Agency if the lease is an operating lease. Prior approval is required from the Agency prior to entering into a capital lease (use Form 7100). Form 7100 is provided on the TWC Financial and Grant Information page at the Agency’s website.
Rental costs are generally allowable to the extent that the rates are reasonable in light of such factors as:
However, the cost principles identify certain limitations on leases that are capital leases, when sale and leaseback arrangements exist, and on leases that are less-than-arms-length leases.) (Additional detail can be found in the federal regulations cited at the end of this section. Specifically, Workforce Investment Act (WIA) funds may not be used for capital leases for real property (see Program Specific Considerations). Leases should be procured in accordance with the requirements in Chapter 14 of this manual.
Workforce Investment Act (WIA) Title I. The U.S. Department of Labor’s Employment and Training Administration (DOLETA) considers capital leases to be purchases of property with borrowed funds. Therefore, WIA funds may not be used for capital leases for real property. Additionally, Contractors may not, with certain exceptions discussed in less-than-arms-length leases, charge fair market rent or lease rates to the WIA program for their own real or personal property used in the program, or lease from other activities in which they have a vested interest or which has interest vested to them. They may recover these costs only through depreciation or use allowances.
6 5 FR 49367 (August 11, 2000)
OMB Circular A-21 (J)(38)
OMB Circular A-87, Attachment B, (38)
OMB Circular A-122, Attachment B, (46)
UGMS Part II, Attachment B, (39)
Sufficient property insurance must be maintained as required for property purchased under a federal or state award.
The Agency-Board Agreement (ABA) requires Nongovernmental entities to purchase and maintain property insurance with coverage in an amount that is reasonably sufficient to replace any damaged, lost or stolen property, for as long as property that is purchased using federal or state funds is kept. Similarly, Office of Management and Budget Circular A-110 requires nongovernmental entities to provide coverage for real property and equipment purchased with federal funds that is equivalent to the coverage that the entity maintains for its own property.
Also in accordance with the ABA, the Agency may require Boards that are Nongovernmental entities, or their subcontractors, to replace damaged, lost or stolen property from sources other than federal funds, if the property was originally acquired under a federal or state sponsored award and no property insurance was in effect.
In relation to property losses, the Agency encourages Contractors to develop procedures that require staff to promptly report theft to the authorities and the Contractor’s insurance provider. Consistent with the procedures for program income, and the disposition of property, the funding source that was originally used to acquire property that has been stolen should be compensated for any insurance proceeds resulting from related insurance claims.
Certain grant award contracts awarded by the Agency require Boards to ensure that commercially available insurance is in place to cover any property or casualty claims, damages, or losses (including reasonable attorney's fees) resulting from the activities of the Board, its employees, contractors, agency or clients in any Agency facility in which the Board is co-located.
OMB Circular A-110 §__.31
Agency-Board Agreement, § 22.4