Research Related Regulations, Policies & Procedures

10.4 Property

Property/capital equipment as defined by OMB A-21 Section J.16.a.1 "means an article of nonexpendable, tangible personal property having a useful life of more than one year and an acquisition cost which equals or exceeds the lesser of the capitalization level established by the organization for financial statement purposes, or $5000." Also included in this category would be fabricated equipment.

Property Accounting manages University capital equipment records and provides property information to departments, inventory controllers and outside entities.

Agency Defined Equipment is when a sponsor has a specific definition of equipment, less than the University's definition of $5,000. When this definition is used an "Agency Defined Equipment" account code is used when the project is set up.

Government-Acquired Equipment is equipment acquired by a government for performance of a contract, to which the government holds title unless stated otherwise in the terms and conditions of the contract.

Government-Owned Equipment is equipment owned by the federal government or acquired by the university with federal funds under the terms of a contract or grant for which the federal government retains title.

Government-Furnished Equipment is equipment provided to the university by the federal government or government contractor; title may or may not remain with the federal government.

10.4.1 Procedures

The University is responsible for the control of sponsor-funded/owned property provided under the terms of sponsored project contracts and grants. The University delegates the direct control, maintenance, and accountability of sponsor-funded/owned property used in connection with a contract or grant to the Principal Investigator. PI’s may assign property control functions to the project staff, research coordinator, department property administrator, departmental administrator, or laboratory administrative staff, but the PI still has overall responsibility. It is important that the policies concerning such equipment are carefully followed to ensure that the University is complying with all of its contractual and legal obligations.

10.4.2 Sponsor Requirements

Under federal contracts (not grants), title to equipment acquired by the University using contract funds and costing $5,000 or more, usually remains with the government unless the contract states otherwise. This would include equipment bought in part or completely with matching funds from the University or another source. When the acquisition cost is less than $5,000, title usually vests in the University, provided that the University obtained the contracting officer's approval before each acquisition.

The University, through property accounting, may request that title to government-owned equipment be transferred to the University. The decision to exercise this option should be made on a case-by-case basis. When title vests in the government the University acts as custodian of the equipment. The University also acts as custodian of the equipment when the equipment is furnished by the government and the government retains title.

Under federal grants, the University normally gains title to equipment acquired with grant funds upon acquisition. Although the government may specifically reserve the right to transfer title either to itself or to a third party, in practice this seldom happens.

Under non-Federal awards, title to and disposition of any equipment purchased with sponsor funds should be specified in the award terms. The preferred option is for the University to take title to the equipment upon acquisition.

10.4.3 Acquisitions Funded by Research Grants & Contracts

Requisitions calling for expenditures, to be funded by grants or contracts, for capital equipment or remodeling of facilities are subject to review by the Grants & Contracts Accounting to determine the allowability of the proposed procurement under the terms of the grant or contract. Requisitions for capital equipment not specifically authorized by the grant or contract will not be processed until approval is obtained from the granting agency.

A requisition for capital equipment will not be processed if the requisition is dated 90 days or less prior to the project ending date. Exceptions occur when either the requisition is accompanied by documentation, approved by the vice president for research, or his/her designee, demonstrating that acquisition of such equipment is necessary to achieve the objectives of the contract or grant, or if it is specified under the terms and conditions of an equipment grant. A requisition for either supplies or equipment will not be processed if it appears probable that the university will not receive the requisitioned items within a reasonable period of time prior to the project ending date.

All federally funded purchases must comply with applicable federal procurement procedures, regulations, terms, and conditions. Purchases based on single price quotations must meet price reasonableness/cost analysis criteria prior to award.

Last Updated: 11/14/16