41 C.F.R. Subpart 109–1.51—Personal Property Management Standards and Practices
Title 41 - Public Contracts and Property Management
This subpart provides guidance on DOE standards and practices to be applied in the management of personal property. The standards and practices that apply to equipment shall be based on the unit acquisition cost threshold specified in the definition of equipment contained in section §109–1.100–51 of this part. No other acquisition cost threshold shall apply. Personal property shall be used only in the performance of official work of the United States Government, except: (a) In emergencies threatening loss of life or property as authorized by law; (b) As otherwise authorized by law and approved by the Director, Office of Administrative Services; heads of field organizations for their respective organizations; or a contracting officer for contractor-held property. Personal property management practices shall assure the best possible use of personal property. Supplies and equipment shall be generally limited to those items essential for carrying out the programs of DOE efficiently. (a) Personal property which is not excess and would otherwise be out of service for temporary periods may be loaned to other DOE offices and contractors, other Federal agencies, and to others for official purposes. The loan request shall be in writing, stating the purpose of the loan and period of time required. The loan shall be executed on DOE Form 4420.2, Personal Property Loan Agreement or computer generated equivalent when approved in writing by the OPMO or on-site DOE property administrator. When approved, a memorandum transmitting the loan agreement shall be prepared identifying the loan period, delivery time, method of payment and transportation, and point of delivery and return, to ensure proper control and protect DOE's interest. The loan period shall not exceed one year, but may be renewed in one year increments. Second renewals of loan agreements shall be reviewed and justified at a level of management at least two levels above that of the individual making the determination to loan the property. Third renewals shall be approved by the head of the field organization or designee. (b) Requests for loans to foreign Governments and other foreign organizations shall be submitted to the Deputy Assistant Secretary for International Energy Policy, Trade and Investment for approval, with a copy to the cognizant Headquarters program office. (a) DOE organizations and designated contractors are encouraged to borrow personal property within DOE to further DOE programs. Property classified as Equipment Held For Future Projects (EHFFP) or as In Standby should be reviewed by those receiving availability inquiries for short-term use (one year or less). Borrowing of Government personal property from other Federal agencies is also encouraged when required for short periods of time. Such transactions shall be covered by written agreements which include all terms of the transaction. (b) In determining whether it is practical and economical to borrow personal property, consideration shall be given to suitability, condition, value, extent and nature of use, extent of availability, portability, cost of transportation, and other similar factors. (c) Adequate records and controls shall be established and maintained for borrowed property to ensure its proper control and prompt return to the lender. (a) Personal property shall be marked “U.S. Government property” (if marking space is limited, property may be marked “U.S. DOE”) subject to the criteria below. The markings shall be securely affixed to the property, legible, and conspicuous. Examples of appropriate marking media are bar code labels, decals, and stamping. (1) Equipment and sensitive items shall be marked “U.S. Government property” and numbered for control purposes. (2) Administratively controlled property and other personal property susceptible to unauthorized personal use should be marked “U.S. Government property” and numbered for control purposes. (b) Personal property which by its nature cannot be marked, such as stores items, metal stock, etc., is exempted from this requirement. (c) To the extent practicable and economical, markings shall be removed prior to disposal outside of DOE, or, if removal is impractical, additional permanent markings must be added to indicate such disposal. Ordinarily, contractor-owned personal property shall be segregated from Government personal property. Commingling of Government and contractor-owned personal property may be allowed only when: (a) The segregation of the property would materially hinder the progress of the work (i.e., segregation is not feasible for reasons such as small quantities, lack of space, or increased costs); and (b) Control procedures are adequate (i.e., the Government property is specifically marked or otherwise identified as Government property). Controls such as property pass systems, memorandum records, regular or intermittent gate checks, and/or perimeter fencing shall be established as appropriate to prevent loss, theft, or unauthorized removal of property from the premises on which such personal property is located. The contractor's property control records shall provide the following basic information for every accountable item of Government personal property in the contractor's possession and any other data elements required by specific contract provisions: (a) Contract number or equivalent code designation. (b) Asset type. (c) Description of item (name, serial number, national stock number (if available)). (d) Property control number (Government ownership identity). (e) Unit acquisition cost (including delivery and installation cost, when appropriate, and unit of measure). (f) Acquisition document reference and date. (g) Manufacturer's name, model and serial number. (h) Quantity received, fabricated, issued or on hand. (i) Location (physical area) (j) Custodian name and organization code. (k) Use status (active, storage, excess, etc.) (l) High risk designation. (m) Disposition document reference and date. An individual property record will be developed and maintained for each item of equipment. Individual item records will be maintained for each sensitive item. Minimum dollar value thresholds for controlling sensitive items, if used, will be determined by the OPMO for each DOE organization in consultation with appropriate management officials. This threshold may be applied organization-wide or by individual contractors or location. Identification of types of property meeting the DOE-PMR definition of sensitive property should be the primary determinant of sensitive category, with dollar thresholds, if any, considered as a guideline only. Sensitive items which are also equipment will be controlled as both sensitive items and equipment. Perpetual inventory records are to be maintained for stores inventory items. Perpetual inventory records are to be maintained for precious metals. No formal property management records are required to be maintained for this category of personal property, which includes such items as those controlled for calibration or maintenance purposes, contaminated property, tool crib items, and equipment pool items. Various control records can be employed to help safeguard this property against waste and abuse, including purchase vs. use information, tool crib check-outs, loss and theft reports, calibration records, disposal records, and other similar records. Control techniques would include physical security, custodial responsibility, identification/marking, or other locally established control techniques. (a) A list of types of personal property considered to be sensitive shall be developed and maintained by each DOE activity/site, taking into consideration value, costs of administration, need for control, and other factors that management determines should apply. (b) Items of equipment which are also designated as sensitive items will be controlled as sensitive items and as equipment. (c) Written procedures shall be established for control of sensitive items and shall address: (1) Approval of purchase requisitions or issue documents at an appropriate supervisory level; (2) Establishment of controls in the central receiving and warehousing department, such as extraordinary physical protection, handling, and maintenance of a current listing of sensitive items; (3) Establishment and maintenance of appropriate records; (4) Requirement for tagging and identification; (5) Use of memorandum receipts or custody documents at time of assignment or change in custody; (6) Establishment of custodial responsibilities describing: (i) Need for extraordinary physical protection; (ii) Requirement for efficient physical and administrative control of sensitive items assigned for general use within an organizational unit as appropriate to the type of property and the circumstances; (iii) Requirement for prompt reporting and investigation of loss, damage or destruction; and (iv) Requirement for promptly reporting changes in custody. (7) Requirement for periodic physical inventories (see §109–1.5110 of this part). (8) Requirement for an employee transfer or termination check-out procedure and examination and adjustment of records; (9) Reminder of prohibition of use for other than official purposes and penalties for misuse; (10) A clear statement of the extent of responsibility for financial accountability depending upon contractor policy; and (11) Other procedures which have demonstrated efficient physical and administrative control over sensitive items. (a) Physical inventories of those categories of personal property as specified in paragraph (f) of this section shall be conducted at all DOE and designated contractor locations. (b) Physical inventories shall be performed by the use of personnel other than custodians of the property. Where staffing restraints or other considerations apply, the inventory may be performed by the custodian with verification by a second party. (c) Detailed procedures for the taking of physical inventories shall be developed for each DOE office and designated contractor. The OPMO shall review and approve the DOE office and contractor procedures. (d) The conduct of a physical inventory will be observed, or follow-on audits made, by independent representatives, e.g., finance, audit, or property personnel, to the extent deemed necessary to assure that approved procedures are being followed and results are accurate. These observations or audits shall be documented and the documentation retained in the inventory record file. (e) Procedures that are limited to a check-off of a listing of recorded property without actual verification of the location and existence of such property do not meet the requirements of a physical inventory. (f) The frequency of physical inventories of personal property shall be as follows: (1) Equipment—biennial. (2) Sensitive items—annual (see paragraph 109–1.5110(l) of this section). (3) Stores inventories—annual. (4) Precious metals—annual. (5) Administratively controlled items—There is no formal Department requirement for the performance of physical inventories of this property. However, OPMOs should determine such requirements based on management needs. (g) Physical inventories shall be performed at intervals more frequently than required when experience at any given location or with any given item or items indicates that this action is necessary for effective property accounting, utilization, or control. (h) Physical inventories of equipment may be conducted by the “inventory by exception” method. The system and procedures for taking physical inventories by this method must be fully documented and approved in writing by the OPMO. (i) The results of physical inventories shall be reconciled with the property records, and with applicable financial control accounts. (j) The results of physical inventories shall be reported to the OPMO within 30 days after the reconciliation required above. (k) Physical inventories of equipment and stores inventories may be conducted using statistical sampling methods in lieu of the normal wall-to-wall method. The sampling methods employed must be statistically valid and approved in writing by the OPMO. If use of the statistical methods of physical inventory does not produce acceptable results, the wall-to-wall method shall be used to complete the inventories. (l) Physical inventories of sensitive items (excluding arms, ammunition, and military property) having an acquisition cost of $2,000 or less may also be conducted using statistical sampling methods. However if statistical sampling methods are used, a wall-to-wall inventory is required no less frequently than every three years and at contract completion (unless there is a follow-on contract with the same contractor). When Government property is worn out, lost, stolen, destroyed, abandoned, or damaged beyond economical repair, it shall be listed on a retirement work order. A full explanation shall be supported by an investigation, if necessary, as to the date and circumstances surrounding the wear, loss, theft, destruction, abandonment, or damage. The retirement work order shall be signed by the responsible official initiating the report and reviewed and approved by an official at least one supervisory level above the official initiating the report. DOE offices shall establish procedures to provide for the reporting, documentation, and investigation of instances of loss, damage, or destruction of personal property including: (a) Notification to appropriate DOE organizations and law enforcement offices; (b) Determination of cause or origin; (c) Liability and responsibility for repair or replacement; and (d) Actions taken to prevent further loss, damage, or destruction, and to prevent repetition of similar incidents. (a) Designated contractors shall report any loss, damage, or destruction of personal property in its possession or control, including property in the possession or control of subcontractors, to the property administrator as soon as it becomes known. (b) When physical inventories, consumption analyses, or other actions disclose consumption of property considered unreasonable by the property administrator; or loss, damage, or destruction of personal property not previously reported by the contractor, the property administrator shall require the contractor to investigate the incidents and submit written reports. (c) Reports of physical inventory results and identified discrepancies shall be submitted to the property administrator within 90 days of completion of physical inventories. An acceptable percentage of shrinkage for stores inventories shall be determined by the property administrator on a location-by-location basis, based on type and cost of materials, historical data, and other site-specific factors. This determination shall be in writing and be supported by appropriate documentation. (d) The contractor's report referenced above shall contain factual data as to the circumstances surrounding the loss, damage, destruction or excessive consumption, including: (1) The contractor's name and contract number; (2) A description of the property; (3) Cost of the property, and cost of repairs in instances of damage (in event actual cost is not known, use reasonable estimate); (4) The date, time (if pertinent), and cause or origin; and (5) Actions taken by the contractor to prevent further loss, damage, destruction, or unreasonable consumption, and to prevent repetition of similar incidents. (e) The property administrator shall ensure that the corrective actions taken by the contractor under paragraph (d)(5) of this section satisfactorily address system weaknesses. (f) The contracting officer shall make a determination of contractor liability with a copy of the determination furnished to the contractor and the property administrator. Costs may be assessed against a contractor for physical inventory discrepancies or other instances of loss of Government property within the terms of the contract. Credit should only be applied if specific items reported as lost can be uniquely identified. General physical inventory write-ons are not to be used as a credit. (g) If part of a designated contractor's personal property management system is found to be unsatisfactory, the property administrator shall increase surveillance of that part to prevent, to the extent possible, any loss, damage, destruction or unreasonable consumption of personal property. The property administrator shall give special attention to reasonably assuring that any loss, damage, destruction or unreasonable consumption occurring during a period when a contractor's personal property management system is not approved is identified before approval or reinstatement of approval. Non-Government-owned personal property shall not be installed in, affixed to, or otherwise made a part of any Government-owned personal property when such action will adversely affect the operation or condition of the Government property. Reports to be submitted to the DPMO are listed in Table 1:
Title 41: Public Contracts and Property Management
PART 109–1—INTRODUCTION
Subpart 109–1.51—Personal Property Management Standards and Practices
§ 109-1.5100 Scope of subpart.
§ 109-1.5101 Official use of personal property.
§ 109-1.5102 Maximum use of personal property.
§ 109-1.5103 Loan of personal property.
§ 109-1.5104 Borrowing of personal property.
§ 109-1.5105 Identification marking of personal property.
§ 109-1.5106 Segregation of personal property.
§ 109-1.5107 Physical protection of personal property.
§ 109-1.5108 Personal property records requirements.
§ 109-1.5108-1 Equipment.
§ 109-1.5108-2 Sensitive items.
§ 109-1.5108-3 Stores inventories.
§ 109-1.5108-4 Precious metals.
§ 109-1.5108-5 Administratively controlled items.
§ 109-1.5109 Control of sensitive items.
§ 109-1.5110 Physical inventories of personal property.
§ 109-1.5111 Retirement of property.
§ 109-1.5112 Loss, damage, or destruction of personal property in possession of DOE direct operations.
§ 109-1.5113 Loss, damage, or destruction of personal property in possession of designated contractors.
§ 109-1.5114 Use of non-Government-owned property.
§ 109-1.5148 Personal property management reports.
Table 1---------------------------------------------------------------------------------------------------------------- Report title Due at DOE headquarters References Form No.----------------------------------------------------------------------------------------------------------------(1) Report of Exempted Motor On request............. FPMR 101-38.204-4, DOE-PMR Letter. Vehicles. 109-38.204-4.(2) Agency Report of Motor Vehicle Oct. 31................ FPMR 101-38.903, DOE-PMR 109- SF 82. Data. 38.903.(3) Excess Personal Property Nov. 15................ FPMR 101-43.4701(c), DOE-PMR Letter. Furnished to Non-Federal Recipients. 109-43.4701(c).(4) Negotiated Sales................ Nov. 15................ FPMR 101-45.4702, DOE-PMR Letter. 109-45.4702.----------------------------------------------------------------------------------------------------------------
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