Section 11: Property ManagementAnchor: #i1012538
This section outlines the subgrantee’s property management responsibilities for equipment and supplies purchased through the Texas Traffic Safety Program.
Subgrantees must establish and administer a system to procure, control, protect, preserve, use, maintain, and dispose of property furnished to them by the Texas Department of Transportation (TxDOT) or purchased through a grant, subgrant, or other agreement in accordance with their own property management procedures, provided that the procedures are not in conflict with the standards contained in this section, or federal property management standards, as appropriate.Anchor: #i1012553
The following definitions apply in regard to property management:
Acquisition cost - the net invoice unit price of an item of purchased equipment, including the cost of modifications, attachments, accessories, or auxiliary apparatus necessary to make the property usable for the purpose for which it was acquired. Other charges, such as the cost of installation, transportation, taxes, duty, or protective in-transit insurance, must be included or excluded from the unit acquisition cost in accordance with the subgrantee’s regular accounting practices.
Controlled assets - assets that qualify as personal property but do not meet the equipment threshold of $5,000, but must be secured and tracked due to the nature of the items. Currently Traffic Safety Controlled Inventory Assets include, but may not be limited to:
- signs, portable message, trailer mounted
- trailers, up to 5400 lbs. GVWR
- personal computers and peripherals, regardless of cost
- items valued up to $4,999.99 in the following groups:
Equipment - tangible, non-expendable, personal property having a useful life of more than one year and an acquisition cost of $5,000 or more per unit.
Excess property - property under the control of any federal awarding agency that is no longer required for the agency’s needs or the discharge of its responsibilities, as determined by the head of the agency.
Exempt property - tangible personal property acquired in whole or in part with federal funds and where the federal awarding agency has statutory authority to vest title in the recipient without further obligation to the federal government. An example of exempt property authority is contained in the Federal Grant and Cooperative Agreement Act (31 U.S.C. 6306), for property acquired under an award to conduct basic or applied research by a non-profit institution of higher education or non-profit organization whose principal purpose is conducting scientific research.
Federally-owned personal property - property furnished by the federal government and whose title remains vested in the federal government. Federally-owned property does not include property purchased through traffic safety grants and agreements.
NOTE: Subgrantees must manage the equipment in accordance with federal agency rules and procedures, and submit an annual inventory listing federally-owned property in their custody to the federal agency that furnished the property.
Federal share (of real property, equipment, or supplies) - that percentage of the property’s acquisition costs and any improvement expenditures paid with federal funds.
Major equipment - tangible, nonexpendable, personal property having a useful life of more than one year and an acquisition cost of $5,000 or more per unit (as defined by the National Highway Traffic Safety Administration [NHTSA] memorandum titled, “Funding Policy for Field Administered Grants”).
Personal property - property of any kind except real property. Personal property may be tangible (having physical existence) or intangible (having no physical existence), such as copyrights, patents, or securities.
Real property - land, including land improvements, structures, and appurtenances thereto, but excludes movable machinery and equipment.
Supplies - personal property having a useful life of less than one year or an acquisition cost of less than $5,000 per unit.Anchor: #i1012647
Acquisition of Equipment
The Texas Traffic Safety Program generally prohibits the acquisition of equipment ($5,000 or greater). However, there are rare exceptions when the TxDOT Traffic Operations Division - Traffic Safety Section (TRF-TS) may determine that a requested acquisition would benefit the program.Anchor: #i1012657
Requesting Prior Approval
A major equipment purchase may occur only if both of the following conditions are met:
- the purchase is specifically authorized in the grant agreement, and
- TxDOT and the NHTSA have approved the purchase, determining it to be in the best interest of the program.
Before initiating the acquisition of equipment, the intended purchaser must obtain written notice from the TRF-TS director stating that both TxDOT and the NHTSA regional administrator have formally approved the equipment purchase. (This procedure is required by 23 CFR §1200.21(d) and “Highway Safety Funding Policy for NHTSA Field Administered Grants.”) The approval may be part of the approval of the Highway Safety Performance Plan (HSPP) or part of a separate written request describing how the equipment would support the state’s Highway Safety Program.
To request approval for equipment (unit acquisition cost of $5,000 or greater) a subgrantee must:
- Ensure that the grant contains necessary provisions and that there are sufficient funds to cover the cost of the equipment.
- Submit an Equipment Request (through eGrants) for approval to the district project manager (or TSS, for local subgrantees) or the statewide program manager (for statewide subgrantees).
- The Equipment Request is located under “Supplemental Approvals” and can be found in the “Examine Related Items” section of the grant.
- Click on “View Related Items” in the “Examine Related Items” section.
- Click on “Initiate a Supplemental.”
- Select “I Agree” when prompted “Are you sure you want to create a Supplemental Report?”
- Click on the “View, Edit, and Complete Forms” section fo the grant to view all available supplemental forms.
- Click on the “Equipment with Unit Acquisition Cost of $5,000 or Greater” page.
- Complete and save the form.
- Complete the checklist request process by changing the status of the form (found under “Change the Status”) to “SR Submitted”. Once the status of the request has been changed to “SR Submitted”, the request will be electronically forwarded to the appropriate project or program manager for review.
NOTE: When making the equipment purchase, the purchaser should also obtain the expected service life and warranty of the equipment from the vendor or the manufacturer.Anchor: #i1012728
The subgrantee’s procurement of property under a grant will follow the same policies and procedures used for procurement with its non-federal funds, provided their procurement procedures conform to the standards specified in 49 CFR 18.36 (the Common Rule).
Any property purchased, regardless of the unit cost, must be specifically authorized in the grant agreement.
The NHTSA “Funding Policy for Field Administered Grants” memorandum states that costs for construction, rehabilitation, or remodeling of any buildings or structures or for purchase of office furnishings and fixtures are unallowable. The following are some examples of such unallowable items:
Notification of Property Purchase
When any personal property is purchased, subgrantees must notify TxDOT TRF-TS by completing the “Equipment” (400) page of the RFR forms with the subgrantee’s monthly or quarterly RFR.Anchor: #i1012760
Property Management Standards
Each subgrantee receiving traffic safety funds for the purchase of property must maintain written property management standards that comply with the requirements of 49 CFR Part 18, Uniform Administrative Requirements for Grants and Cooperative Agreements to State and Local Governments (the Common Rule) or 49 CFR Part 19, Uniform Administrative Requirements for Grants and Cooperative Agreements with Institutions of Higher Education, Hospitals, and Other Nonprofit Organizations (OMB Circular A-110), as appropriate. The subgrantee’s written property management standards must ensure that:
- property records are maintained
- a description of the property
- the manufacturer’s serial number, model number, federal stock number, national stock number, or other identification number
- the inventory number
- the source of the property (including grant or agreement number)
- indication of with whom title is vested (generally vests with the subgrantee)
- the acquisition date
- the percentage (at the end of the budget year) of federal participation in the cost of the project
- the location, use, and condition of the property and the date the information was reported
- the unit acquisition cost
- the ultimate disposition date (including the date of disposal and sales price or the method used to determine the current fair market value)
- a physical inventory of the property is taken and the results reconciled with the subgrantee’s property records on an annual basis (an employee other than the one to whom the equipment is assigned should take the physical inventory and record the physical count)
- an inventory control system is maintained to ensure adequate safeguards to prevent loss, damage, or theft of the property
- any loss, damage, or theft of the property is investigated
- maintenance procedures are adequate to keep the property in good condition
- proper sales procedures are established to ensure the highest return in the event the subgrantee is authorized or required to sell the property.
NOTE: Subgrantees should provide a copy of their inventory policies and procedures to the project manager (for district-managed projects) or the program manager (for state-managed projects).Anchor: #i1012858
Certification of Subgrantee Property
A database of all Texas Highway Safety Program equipment and controlled assets is maintained by TxDOT TRF-TS. Entries of federally funded equipment and controlled assets are performed by the TRF-TS policy and procedures coordinator, based on the information submitted on the “Equipment” (400) page of the monthly or quarterly RFR. Inventory items are then grouped according to the agency in possession (for example, Texas Department of Public Safety, Texas Transportation Institute of TAMU, TxDOT, Austin District, etc.).
Once every two years, the TRF-TS policy and procedures coordinator sends a “Certification of Existence and Condition for Traffic Safety Program Inventory” form, listing all reported traffic safety personal property, to the agencies for completion and return. The form verifies the status regarding the property’s condition, current and future usage for traffic safety activities, and date of the last physical inventory.
When the completed inventory certification forms are returned, TRF reviews them to verify that:
- the necessary information has been entered
- the forms are signed
- the property is in operating condition
- the property is being used for traffic safety activities.
TxDOT program and project directors physically verify the existence and traffic-safety use of each item. This verification is typically completed during on-site monitoring or when division staff visits a district to provide technical assistance.Anchor: #i1012903
Subgrantees must, at a minimum, provide the equivalent insurance coverage for equipment acquired with federal funds as provided to property owned by the subgrantee.
NOTE: Federally-owned property need not be insured unless required by the terms and conditions of the grant.Anchor: #i1012918
Equipment and controlled assets, purchased in whole or in part with traffic safety funds, must be tagged to indicate the item was acquired with traffic safety funds. Traffic safety subgrantees are responsible for developing tagging procedures and for the purchase of tags. In addition, for cross-reference audit purposes, the ID tag number is to be noted on the invoice for each piece of equipment and controlled asset item.Anchor: #i1012928
Upon completion or termination of a traffic safety grant or subgrant, or if it is determined by TxDOT TRF-TS that equipment and supplies are no longer needed for the purpose for which they were acquired, the equipment and supplies will, at the option of TRF-TS, become the property of TRF-TS. Therefore, permission for disposition must be obtained from TRF before any action can be taken regarding the equipment. Some of the possible disposition actions include, but are not limited to:
- transfer from federal inventory to state inventory
- declaration of inoperability and relegation to salvage or sale at auction
- return to TRF-TS from the subgrantee
- declaration that equipment is damaged beyond repair or salvage
- sale at auction and return of proceeds to TxDOT for reconciliation with federal funding.
- allowing the organization to use the equipment and/or supplies for other than traffic safety activities, provided compensation is made to the Traffic Safety Program, based on fair market value.
Fair Market Value (FMV)
Fair Market Value (FMV) may be determined in several ways.
- The first and preferred method is to have property appraised by a licensed appraiser.
- Kelly Blue Book can be used to determine the FMV for passenger vehicles. TxDOT TRF will accept “low” Blue Book value as reimbursement for the vehicle.
- For personal property, such as computer systems or office equipment, written quotes from two (2) local vendors will be acceptable.
- FMV, established through Used Price.com is acceptable.