2011/09/21 Riverside, County Office of Fire Department Emergency Services MEMORANDUM OF UNDERSTANDING
BETWEEN
COUNTY OF RIVERSIDE,
ON BEHALF OF ITS FIRE DEPARTMENT,
OFFICE OF EMERGENCY SERVICES
and the
CITY OF MENIFEE
Table of Contents
I. Purpose..............................................................................................................2
II. Background........................................................................................................2
III. Terms and Conditions.......................................................................................2
A. MOU Modification Process.............................................................2-3
B. Term of MOU ...................................................................................3
C. Responsibilities/Obligations ..........................................................3-4
IV. Signatures..........................................................................................................4
Attachments:
Attachment 1 - Office of Justice Programs Financial Guide 2006—Part Ill Chapter 6
Attachment 2- OMB Circular A87,Attachment B Selected Items of Cost,Section 15
1
MEMORANDUM OF UNDERSTANDING
BETWEEN
COUNTY OF RIVERSIDE
AND THE CITY OF MENIFEE
THIS MEMORANDUM OF UNDERSTANDING (MOU) is made and entered into as of
this twenty-first day of September 2011, by and between the County of Riverside, on
behalf of its Fire Department, Office of Emergency Services, a political subdivision of the
State of California, hereinafter referred to as "OES", representing the Riverside County
Operational Area, and the City of Menifee, hereinafter referred to as "City". City and
DES will sometimes collectively be hereinafter referred to as the"Parties".
RECITALS
WHEREAS, the County of Riverside, Fire Department, representing the
Riverside County Operational Area, has secured Homeland Security Grant Funding from
the State of California Emergency Management Agency, to purchase and outfit
unincorporated county areas and each city within the county, with one hundred person
mass care and shelter trailers ('Trailers"); and
WHEREAS, the acquisition of these Trailers and equipment will assist each city
in their pursuit to enhance their mass care and sheltering capabilities to better protect
against, respond to and recover from catastrophic emergencies; and
WHEREAS, the Parties desire to enter into this MOU to provide the terms and
conditions for each city that receives a Trailer under this grant funding program;
NOW, THEREFORE, the parties hereto agree as follows:
I. PURPOSE.
The purpose of this MOU is to: 1) document the transfer of ownership of one 1
trailers from OES to the City of Menifee; and 2) obligate and document the
acknowledgement of the City to adhere to Office of Justice Programs Financial Guide
2005 — Part III Chapter 6 (Attachment 1) and the State OMB Circular A-87, Attachment
B, Selected Items of Cost, Section 15 "Equipment and Other Capital Expenditures,"
(Attachment 2).
II. BACKGROUND.
In 2008, emergency managers within the Riverside County Operational Area
(OA) identified significant preparedness shortfalls with regard to their ability to properly
shelter one-tenth of the overall population as suggested by federal standards. Because
of this shortfall, OES has secured Homeland Security grant funding for Fiscal Year 2009
and Fiscal Year 2010 to outfit each city and portions of the county unincorporated areas
with one hundred person mass care and shelter trailers. Securing such trailers will pave
the way for enhanced mass care and shelter capabilities in Riverside County.
III. TERMS AND CONDITIONS.
A. MOU MODIFICATION PROCESS.
After execution of this MOU, any and all requests for modifications to this
MOU shall be made in writing to: Riverside County Fire Department Office of Emergency
2
Services (OES) at 4080 Lemon Street, Basement Room 8, Riverside, CA 92501 Attn.
Peter Lent, Deputy Director. DES reserves the right to deny, edit or accept requests for
modifications. OES reserves the right to amend the terms of this MOU if required to
remain in compliance with federal or state grant requirements. The City shall be notified
at least thirty business days in advance of any potential revisions to the terms of this
MOU.
B. TERM OF MOU.
The terms of this MOU shall remain in effect for a period of seven years
from the date of the signing of this document by all involved parties. Over the course of
this MOU, the City agrees to utilize the Trailer solely for its intended purpose of mass
care and shelter.
C. RESPONSIBILITIES/OBLIGATIONS.
By accepting the Trailer(s), City of Menifee, hereby agrees to accept and
uphold the following responsibilities and obligations during the term of this MOU:
1) Store the Trailer in a secured area. The City will be responsible to
determine the location and the type(s) of security to be used to
secure the Trailer.
2) City shall be responsible for all costs associated with maintaining
the trailer to lawfully operate and transport the trailer, including
payment of the initial and annual California Department of Motor
Vehicles registration fees and coverage. Insurance can be
provided either by a specific insurance policy for the equipment or
by a program of self-insurance.
3) City must utilize at least a three quarter-ton pickup truck or greater
to tow the vehicle.
4) Replace any lost, stolen, damaged or used items with equivalent
items within a reasonable timeframe not to exceed sixty (60) days
from the date of loss or use. If the Trailer incurs any damage or
theft during the period of this MOU, the City agrees to replace the
Trailer and/or all of its contents with equivalent items and return
the Trailer to the same level of supplies and conditioning as to
which they were before the theft, damage or use occurred. This
requirement shall apply to the Trailer and all of the components
within the Trailer including all equipment and supplies.
5) Shall not mark, sticker, wrap or otherwise alter the appearance of
the Trailer by adding their City logo or other identifying emblems,
logos, or lettering. City agrees to leave the sticker identifier on the
Trailer that will be on the Trailer at the time of delivery. This three
inch block-style numbering shall remain in place for the duration of
this MOU. City also agrees to utilize the original lock and keys, for
all locks and keys on or in the Trailer, which will be provided with
the Trailer at time of delivery.
6) Maintain all necessary components to keep the Trailer and all
equipment in working order during the term of this MOU, up to and
including but not limited to: tires, batteries, solar panels, regular
3
military cots, enhanced functional needs cots, disposable
blankets, light switches, manual vent fans, rolling carts and doors.
7) As required by the grant, the City agrees to allow the Trailer(s) to
be utilized by other jurisdictions if requested through appropriate
Mutual Aid channels. The City understands and agrees that if the
Trailer is requested as a Mutual Aid resource, that the requesting
jurisdiction will be responsible to pick up, re-stock and return the
Trailer to the City within sixty days (60) of the end of the incident
for which the Trailer/resource was requested, in its original
condition.
8) Comply with all the requirements of the Office of Justice Programs
Financial Guide 2005 — Part III Chapter 6 (Attachment 1) and the
State OMB Circular A-87, Attachment B, Selected Items of Cost,
Section 15 "Equipment and other Capital
Expenditures"(Attachment 2).
IN WITNESS WHEREOF, the parties hereto have caused their duly authorized
representatives to execute this Agreement.
DATED: 47,(-&
COUNTY OF RIVERSIDE
BY
Peter Lent
Deputy Director
CITY OF MENIFE
Signed: v
Authorized RepregWkfive of the City
U 57—
�
rly 4
ATTACHMENT 1
OFFICE of JUSTICE PROGRAMS
FINANCIAL GUIDE 2005 - PART III
CHAPTER 6
PART In CHAPTER b:PROPERTY AND EQUIPMENT
Chapter 6: Property and Equipment -
HIGHLIGHTS OF CHAPTER:
• Acquisition of Property and Equipment
• .Screening
• Loss,Damage,or Tbett of Equipment
• Equipment Acquired with Crime Control Act Block/Formula Funds(BJA)
• Equipment Acquired with Juvenile Justice Act(OJJDP)Formula and Victims of Crime
Act(OVC)Assistance(Formula)Funds
• Equipment and Non-Expendable Personal Property Acquired with Discretionary Funds
• Real Property Acquired with Formula Funds
• Real Property Acquired with Discretionary Funds
• Federal Equipment
• Replacement of Property(Equipment and Non-Expendable Personal Property)
• Retention of Property Records
• Supplies
• Copyrights
• Patents,Patent Rights,and Inventions
MARCH 2O05 55
PAR7m CHAPTE116:PROPERTY AND EQUIPMENT
ACQUISITION OF PROPERTY AND EQUIPMENT
Recipients/subrecipients are required to be prudent in the acquisition and management of property
with Federal funds.Expenditure of funds for the acquisition of new property,when suitable
property required for the successful execution of projects is already available within the recipient
or subrecipient organization will be considered an unnecessary expenditure.
NOTE;Equipment purchased using funds made available under Federal grants shall be year 2000
compliant and shall be able to process all time/date data after December 31,1999.
SCREENING
Careful screening should take place before acquiring property in order to ensure that it is needed,
with particular consideration given to whether equipment already in the possession of the
recipieint/subrecipient organization can meet identified needs. While there is no prescribed
standard for such review,recipient/subrecipient procedures may establish levels of review
dependent on factors such as the cost of the proposed equipment and the size of the recipient or
subrecipient organization.
Tlie establishment of a screening committee may facilitate the process;however,a recipient or
subrecipient may utilize other management techniques which it finds effective as a basis for
determining that the property is needed and that it is not already available within the iecipienf s
organization.
The awarding agency's program monitors must ensure that the screening referenced above takes
place and that the recipient/subrecipient has an effective system for property management.
Recipients/subrecipients are hereby informed that if the awarding agency is made aware that the
recipient/subrecipient does not employ an adequate property management system,project costs
associated with the acquisition of the property may be disallowed.
LOSS,DAMAGE,OR THEFT OF EQUIPMENT
Recipients/subrecipients are responsible for replacing or repairing the property which is willfully
or negligently lost,stolen,damaged,or destroyed.Ally loss,damage,or theft of the property must
be investigated and fully documented and made part of the official project records,
EQUIPMENT ACQUIRED WITH CRIME CONTROL ACT BLOCKIFORMULA FUNDS
(BJA)
Equipment acquired shall be managed to ensure that the equipment is used for criminal justice
purposes. Standards and procedures governing ownership,use,management, and disposition are
as follows.
l, Title.The Omnibus Crime Control and Safe Streets Act of 1968,as amended,42 USC §3789,
at sec..,Section 808,requires that the title to all equipment and supplies purchased with funds
made available under the Crime Control Act shall vest in the criminal justice agency or non-
profit organization that purchased the property,if it provides written certification to the State
MARCH 2O05 56
v
i
PART in CHAPTER 6:PROPERTY AND EQUIPMENT
office that it will use the property for criminal justice purposes.If such written certification is
not made,title to the property shall vest in the State office,which shall seek to have the
equipment and supplies used for criminal justice purposes elsewhere in the State prior to using
it or disposing of it in any other manner.
2. Use and Management.A subrecipient or State shall use and manage equipment in
accordance with its procedures as long as the equipment is used for criminal justice purposes.
3. Disposition.When equipment is no longer needed for criminal justice purposes,a State shall
dispose of equipment(for both the State said subrecipients),in accordance with State
procedures,with no further obligation to the awarding agency.
EQUIPMENT ACQUIRED WITH JUVENILE JUSTICE ACT(OJJDP)FORMULA AND
VICTIMS OF CRIME ACT(OVC)ASSISTANCE(FORMULA)FUNDS
Equipment acquired under an award shall be managed to ensure that the equipment is used for
criminal justice purposes.Standards and procedures governing ownership,use,management,and
disposition are as follows.
1. Title.Title to equipment acquired under an award or subaward will vest upon acquisition in
the recipient or subrecipient subject to the obligations and conditions set forth in 28 CFR Part
66.
2. Use.
a. A State shall use equipment acquired under an award in accordance with State laws and
procedures.The awarding agency encourages the States to follow the procedures set forth
in this Guide,
b. Other government recipients and subrecipients shall use equipment in accordance with the
following requirements:
(1) Equipment must be used by the recipient or subrecipient in the program or project
for which it was acquired as long as needed,whether or not the project or program
continues to be supported by Federal funds. When no longer needed for the original
program or project,the equipment may be used in other activities currently or
previously supported by a Federal agency.
(2) The recipient or subrecipient shall also make equipment available for use on other
projects or programs currently or previously supported by the Federal govenunent,
providing such use does not interfere with the work on the projects or programs for
which it was originally acquired.First preference for other use shall be given to
other programs or projects supported by the awarding agency.User fees should be
considered and treated as program income to the project, if appropriate,
.(3) Notwithstanding program income,the recipient or subrecipient shall not use
equipment acquired with funds to provide services for a fee to compete unfairly with
private companies that provide equivalent services,unless specifically permitted or
contemplated by Federal statute.
MARCH 2O05 57
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PARTIR CHAPTER 6;PROPERTY AND EQUIPMENT
(4) When acquiring replacement equipment,recipients or subrecipients may use the
equipment to be replaced as a trade-in or sell the equipment and use the proceeds to
offset the cost of the replacement equipment, subject to the written approval of the
awarding agency.
3. Management.
a. A State shall manage equipment acquired under an award to the State in accordance with
State laws and procedures.
b, Other government recipient and subrecipient procedures for managing equipment
(including replacement),whether acquired in whole or in part with project funds,will,at a
minimum,meet the following requirements:
(1)Property records must be maintained which include:
(a)Description of the property;
(b)Serial number or other identification number,
(c)Source of the property;
(d)Identification of title holder,
(e)Acquisition date;
(f)Cost of the property;
(g)Percentage of Federal participation in the cost of the property;
(h)Location of the property;
(i)Use and condition of the property;and
0)Disposition data,including the date of disposal and sale price.
(2)A physical inventory of the properly must be taken and the results reconciled with the
property records at least once every two years.
(3)A control system must exist to ensure adequate safeguards to prevent:
(a)Loss;
(b)Damage;or
(o)Theft of the property.
Any loss,damage,or theft shall be investigated by the recipient and subrecipient,as
appropriate.
MARCH 2005 58
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PART ltl CHAPTER 6:PROPERTY AND EQUIPMENT
(4)Adequate maintenance procedures must exist to keep the property in good condition.
(5) If the recipient or subrecipient is authorized or required to sell the property,proper
sales procedures must be established to ensure the highest possible return.
4. Disposition.
a. A State recipient shall dispose of its equipment acquired under an award to the State in
accordance with State laws and procedures.
b. Other government recipients and subrecipients shall dispose of the equipment when
original or replacement equipment acquired under the award or subaward is no longer
needed for the original project or program,or for other activities currently or previously
supported by a Federal agency.Disposition of the equipment will be made as follows:
(1) Items with a current per unit fair market value of less than$5,000 may be retained,
sold,or otherwise disposed of with no further obligation to the awarding agency.
(2) Items with a current per unit fair market value in excess of$5,000 may be retained or
sold,and the awarding agency shall have a right to an amount calculated by
multiplying the current market value or proceeds from sale by the awarding agency's
shale of the equipment, Seller is also eligible for sale costs.
(3) In cases where a recipient or subrecipient fails to take appropriate disposition actions,
the awarding agency may direct the recipient or subrecipient to take other disposition
actions.
EQUIPMENT AND NON-EXPENDABLE PERSONAL PROPERTY ACQUIRED WITH
DISCRETIONARY FUNDS
I. Title.Title to equipment acquired with Federal funds will vest upon acquisition in the
recipient subject to the obligations and conditions set forth in 28 CFR Part 66 for State and
local units of government,and in 28 CFR Part 70 for other recipients.
2. Use.A State shall use equipment acquired under an award by the State in accordance with
State laws and procedures.
Local government recipients shall use equipment in accordance with the requirements
contained in the section"EQUIPMENT ACQUIRED WITH JUVENILE JUSTICE ACT
(OJJDP)FORMULA AND VICTIMS OF CRIME ACT(OVC)ASSISTANCE(FORMULA)
FUNDS"
Other recipients shall use non-expendable personal property in the project or program for
which it was acquired as long as needed,whether or not the project or program continues to be
supported by Federal funds. When no longer needed for the original project or program,the
recipients shall use the non-expendable personal property in connection with its other
Federally-sponsored activities in the following order of priority:
a. Other projects of the awarding agency needing the property.
MARCH 2O05 59 n/
PART nl CHAPTER 6:PROPERTY AND EQUIPMENT
b. Grants of a State needing the property.
c. Projects of other Federal agencies needing the property. —
3. Management.
a. A State shall manage its equipment acquired under an award in accordance with State =
laws and procedures.
b. Local government recipients and subrecipients shall manage equipment in accordance
with requirements stated in the section"EQUIPMENT ACQUIRED WITH JUVENILE
JUSTICE ACT(OJJDP)FORMULA AND VICTIM OF CRIME ACT(OVC)
ASSISTANCE(FORMULA)FUNDS."
c, Other recipients' property management standards for non-expendable personal property
shall include the following procedural requirements:
(1) Property records shall be maintained accurately and include:
(a) A description of the property;
(b) Manufacturer's serial number,model number,Federal stock number,or other
identification number;
(c) Source of the property,including the award number;
(d) Whether title vests in the recipient or the Federal government;
(e) Acquisition date(or date received,if the property was furnished by the Federal
government)and cost,
(1) Percentage(at the end of the budget year)of Federal participation in the cost of
the project or program for which the property was acquired(not applicable to
property furbished by the Federal government);
(g) Location,use,and condition of the property at the date the information was
reported;
(h) Unit acquisition cost;and
(i) Ultimate disposition data, including date of disposal and sales price or the method
used to determine current fair market value where a recipient compensates the
Federal-sponsoring agency for its share,
(2) A physical inventory of property shall be taken and the results reconciled with the
property records at least once every two years. Any differences between quantities
determined by the physical inspection and those shown in the accounting records shall
be investigated to determine the causes of the difference.The recipient shall,in
connection with the inventory,verify the existence,current utilization,and continued
need for the property.
MARCH 2O05 60
PARTIa CHAPTER6:PR0PERTY AND EQUIPMENT
(3) A control systerp shall be in effect to ensure adequate safeguards to prevent loss,
damage,or theft of the property.Any loss,damage,or theft of non-expendable
property shall be investigated and fully documented. If the property was owned by the
Federal government,the recipient shall promptly notify the Federal agency.
(4) Adequate maintenance procedures shall be implemented to keep the property in good
condition.
(5) Where the recipient is authorized or required to sell the property,proper sales
procedures shall be established which would provide for competition to the extent
practicable and result in the highest possible return.
4. Disposition.
a. A State shall dispose of its equipment acquired under the award by the State in accordance
with State laws and procedures.
b. Local government recipients and subrecipients shall follow the disposition requirements in
the section"EQUIPMENT ACQUIRED WITH JUVENILE JUSTICE ACT(OJJDP)
FORMULA AND VICTIM OF CRIME ACT(OVC)ASSISTANCE(FORMULA)
FUNDS."
c. Other recipients shall adhere to the following disposition requirements for non-expendable
personal property:
(1) A recipient may use non-expendable personal property with a fair market value of less
than$5,000 for other activities without reimbursement to the Federal government,or
may sell the property and retain the proceeds.
(2) A recipient may retain non-expendable personal property with a fair market value of
$5,000 or more for other uses provided that compensation is made to the awarding
agency or its successor.The amount of compensation shall be computed by applying
the percentage of Federal participation in the cost of the original project or program to
the current fair market value of the property.If the recipient has no need for the
property and the property has further use value,the recipient shall request disposition
instructions from the awarding agency.The awarding agency shall determine whether
the property can be used to meet the agency's requirements.If no requirement exists
within that agency,the availability of the property shall be reported to the General
Services Administration by the Federal agency to determine whether a requirement for
the property exists in other Federal agencies.The awarding agency shall issue
instructions to the recipient no later than 120 days after the recipient's request,and the
following procedures shall govern:
(a)If so instructed,or if disposition instructions are not issued within 120 calendar
days after the recipient's request,the recipient shall sell the property and
reimburse the awarding agency an amount computed by applying to the sales
proceeds the percentage of Federal participation in the cost of the grant,However,
the recipient shall be permitted to deduct and retain from the Federal share$100 or
MARCH 2O05 61
PART III CHAPTER 6:PROPERTY AND F.QMPMENT
10 percent of the proceeds,whichever is greater,for the recipient's selling and
handling expenses.
(b)If the recipient is instructed to ship the property to other agencies needing the
property,the recipient shall be reimbursed by the benefiting Federal agency with
an amount computed by applying the percentage of the recipient's participation in
the cost of the project or program to the current fair market value of the property,
plus any reasonable shipping or interim storage costs incurred.
(c)If the recipient is instructed to otherwise dispose of the property,the recipient shall
be reimbursed by the awarding agency for such costs incurred in its disposition.
5. Transfer of Title.The awarding agency may reserve the right to transfer title to property
acquired with Federal funds that have a fair market value of$5,000 or more to the Federal
government or a third parry named by the awarding agency,when such a third party is
otherwise eligible under existing statutes.Such transfers are subject to the following
standards:
a. The property must be identified in the award or otherwise made known to the recipient in
writing.
b. The awarding agency shall issue disposition instructions within 120 calendar days after
ilia end of the Federal support of the project for which it was acquired.If the awarding
agency fails to issue disposition instructions within the 120 calendar day period,the
recipient shall follow standards set in 28 CFR Parts 66 and 70.
c. When title to property is transferred,the recipient shall be paid an amount calculated by
applying the percentage of participation in the purchase to the current fair market value of
Vie property.
REAL PROPERTY ACQUIRED WITH FORMULA FUNDS
1. Land Acquisition.Block/formula funds CANNOT be used for land acquisition.
2. Title.Subject to the obligations and conditions set forth in the award,title to real property
acquired under an award or subaward vests,upon acquisition,in the recipient or subrecipient.
3. Use of Real Property.The recipient and its subrecipients may use real property acquired, in
whole or in part,with Federal funds for the authorized purposes of the original grant or
subaward as long as needed for that purpose.The subrecipients shall maintain an inventory
report which identifies real property acquired,in whole or in part,with block or formula
funds.The recipient or subrecipient shall not dispose of or encumber its title or other interests.
4. Disposition.The subrecipiant shall obtain approval for the use of the real property in other
projects when the subrecipient determines that the real property is no longer needed for the
original grant purposes.Use in other projects shall be limited to those under other Federally-
sponsored projects or programs that have purposes consistent with those authorized for
support by the State. When the real property is 110 longer needed as provided above,the
MARCH 2O05 62 .
PART In CHAPTER 6:PROPERTY AND EQUIPMENT
subrecipient shall request disposition instructions from the State.The State shall exercise one
of the following:
a. Direct the real property to be transferred to another subrecipient or a criminal justice
activity needing the property,provided that use of such real property is consistent with
those objectives authorized for support by the State.
b. Return all real property furnished or purchased wholly with Federal funds to the control of
the awarding agency.In the case of real property purchased in part with Federal funds,the
subrecipient may be permitted to retain title upon compensating the awarding agency for
its fair share of the properly.The Federal share of the property shall be computed by
applying the percentage of the Federal participation in the total cost of the project for
which the property was acquired to the current fair market value of the property. In those
instances where the subrecipient does not wish to purchase real property originally
purchased In part with Federal Rinds,disposition instructions shall be obtained from the
awarding agency.
REAL PROPERTY ACQUIRED WITH DISCRETIONARY FUNDS
1. Land Acquisition,Discretionary funds CANNOT be used for land acquisition.
2. Title.Subject to obligations and conditions set forth in 28 CFR Parts 66 and 70,title to real
property acquired under an award vests upon acquisition with the recipient.
3. Use of Property.The use of property by the recipient is subject to the same principles and
standards as outlined for property acquired with formula funds.
4. Disposition.The recipient shall follow the same principles and standards as outlined for
subrecipients,except the recipient shall request disposition instructions from the Federal
agency,not the State.
5. Transfer of Title.With regard to the transfer of title to the awarding agency or to a third
party designated/approved by the awarding agency,the recipient or subrecipient shall be paid
an amount calculated by applying the recipient's or subrecipient's percentage of participation
in the purchase of the real property to the current fair market value of the property.
r,r,DFRALEQUIPMMINT
In tie event a recipient or subrecipient is provided Federally-owned equipment,the following
requirements apply:
1. Title remains vested in the Federal government.
2. Recipients or subrecipients shall manage the equipment in accordance with the awarding
agency's rules and procedures and submit an annual inventory listing,
3. When the equipment is no longer needed,the recipient or subrecipient shall request
disposition instructions from the awarding agency.
MARCH 2O05 63 '
PART ID CHAPTER 6:PROPERTY AND EQUIPMENT
REPLACEMENT OF PROPERTY(EQUIPMENT AND PION-EXPENDABLE PERSONAL
PROPERTY)
When an item of property is no longer efficient or serviceable but the recipient/subrecipient
continues to need the property in its criminal justice system, the recipient/subrecipient may
replace the property through trade-in or sale and subsequent purchase of new property,provided
the following conditions are met;
1. Similar Function.Replacement property must serve the same function as the original
property and must be of the same nature or character,although not necessarily of the same
grade or quality.
2. Credits.Value credited for the ptoperty,if the property is traded in,must be related to its fair
market value.
3. Time.Purchase of replacement property must take place soon enough after the sale of the
property to show that the sale and the purchase are related,
4. Compensation.When acquiring replacement property,the recipient/subrecipient may use the
property to be replaced as a trade-in or the proceeds from the sale of the property to offset the
cost of the new property.
S. Prior Approval.State subrecipients shall obtain the written permission of the State to use the
provisions of this section prior to entering into negotiation for the replacement or trade-in of
property.
RETENTION OF PROPERTY RECORDS
Records for equipment,non-expendable personal property,and real property shall be retained for
a period of three years from the date of the disposition or replacement or transfer at the discretion
of the awarding agency.If any litigation,claim,or audit is started before the expiration of the
three-year period,the records shall be retained until all litigations,claims,or audit findings
involving the records have been resolved.
SUPPLIES
I. Title.Title to supplies acquired under an award or subaward vests,upon acquisition,in the
recipient or subrecipient,respectively.
2. Disposition.If there is a residual inventory of unused supplies exceeding$5,000 in total
aggregate fair market value upon termination or completion of the funding support and the
supplies are not needed for any other Federally-sponsored programs or projects;the recipient
or subrecipient shall compensate the awarding agency for its share. The amount of
compensation shall be computed in the same manner as for non-expendable personal property
or equipment.
MARCH?AD5 64
PART In CHAPTER6:PROPERTY AND EQUIPMENT
COPYRIGHTS
The awarding agency reserves a royalty-fine,non-exclusive, and irrevocable license to reproduce, -
publish,or otherwise use,and authorize others to use,for Federal government purposes:
1. The copyright in any work developed under an award or subaward;and
2. Any rights of copyright to which a recipient or subrecipient purchases ownership with
support.
PATENTS,PATENT RIGHTS,AND IN MNTIONS
If any program produces patentable items,patent rights,processes,or inventions,in the course of
work sponsored by the Federal award or subaward funds,such facts must be promptly and fully
reported to the awarding agency. Unless there is a prior agreement between the recipient and the
awarding agency on disposition of such items,the awarding agency shall determine whether
protection on the invention or discovery shall be sought.The awarding agency will also determine
how rights in the invention or discovery(including rights under any patents issued thereon)shall
be allocated and administered in order to protect the public interest consistent with"Government
Patent Policy"(President's Memorandum for Heads of Executive Departments and Agencies,
dated August 23, 1971,and statement of Government Patent Policy, as printed in 36 FR 16839).
Government-wide regulations have been issued at 37 CFR Part 401 by the Department of
Commerce.
MARCH 2O05 65
ATTACHMENT 2
OMB A87 ATTACHMENT
B SELECTED ITEMS OF
COST SECTION 15
"EQUIPMENT & OTHER
CAPITAL EXPENDITURES"
Only the pertinent portions of this document have been included as an attachment to
this MOU
OM13 4917 SCc7YoAl
b.Donated services received:
(1)Donated or volunteer services may be furnished to a governmental unit by professional and
technical personnel, consultants,and other skilled and unskilled labor.The value.of these
services is not reimbursable either as a direct or indirect cost.However,the value of donated
services may be used to meet cost sharing or matching requirements in accordance with the
Federal Grants Management Common Rule. -
(2)The value of donated services utilized in the performance of a direct cost activity shall,when
material in amount,be considered in the determination of the governmental unit's indirect costs
or rate(s)and,accordingly, shall be allocated a proportionate share of applicable indirect costs.
(3)To the extent feasible,donated services will be supported by the same methods used by the
governmental unit to support the allocability of regular personnel services.
13.Employee morale health and welfare costs.
a.The costs of employee information publications,health or first-aid clinics and/or infirmaries,
recreational activities,employee counseling services, and any other expenses incurred in
accordance with the governmental unit's established practice or custom for the improvement of
O working conditions,employer-employee relations, employee morale,and employee performance
are allowable.
b.such costs will be equitably apportioned to all activities of the governmental unit. Income
generated from any of these activities will be offset against expenses.
14.Entertainment. Costs of entertainment,including amusement, diversion,and social activities
and any costs directly associated with such costs(such as tickets to shows or sports events,
meals, lodging,rentals,transportation,and gratuities)are unallowable.
15.Equipment and other capital expenditures.
a.For purposes of this subsection 15,the following definitions apply:
(1) "Capital Expenditures','means expenditures for the acquisition cost of capital assets
(equipment,buildings,land), or expenditures to make improvements to capital assets that
materially increase their value or useful life. Acquisition cost means the cost of the asset
including the cost to put it in place.Acquisition cost for equipment,for example,means the net
invoice price of the equipment, including the cost of any modifications,attachments, accessories,
or auxiliary apparatus necessary to make it usable for the purpose for which it is acquired.
Ancillary charges,such as taxes,duty,protective in transit insurance,freight,and installation
may be included in, or excluded from the acquisition cost in accordance with the governmental
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r� unit's regular accounting practices.
(2) "Equipment"means an article ofnonexpendable,tangible personal property having a useful
life of more than one yearand an acquisition cost which. equals or exceeds the lesser of the
capitalization level established by the governmental unit for financial statement purposes,or .
$5000.
(3) "Special purpose equipment"means equipment which is used only for research,medical,
scientific, or other technical activities.Examples of special purpose equipment include
microscopes,x-ray machines,.surgical instruments,and spectrometers.
(4)"General purpose equipment"means equipment,which is not limited to research,medical,
scientific or other technical activities.Examples include office equipment and furnishings,
modular offices;telephone networks,information technology equipment and systems,air
conditioning equipment,reproduction and printing equipment,and motor vehicles.
b.The following rules of allowability shall apply to equipment and other capital.expenditures:
(1)Capital expenditures for general purpose equipment,buildings,and land are unallowable as
direct charges,except where approved in advance by the awarding agency.
(2)Capital expenditures for special purpose equipment are allowable as direct costs,provided
that items with a unit cost of$5000 or more have the prior approval of the awarding agency.
(3)Capital expenditures for improvements to land,buildings,or equipment which materially
increase their value or useful life are unallowable as a direct cost except with the prior approval
of the awarding agency.
(4)When approved as a direct charge pursuant to Attachment B,section 15.b(1), (2), and(3)
above,capital expenditures will be charged in the period in which the expenditure is incurred,or
as otherwise determined appropriate and negotiated with the awarding agency. In addition,
Federal awarding agencies are authorized at their option to waive or delegate the prior approval
requirement.
(5)Equipment and other capital expenditures are unallowable as indirect costs.However,see ....
section 11,Depreciation and use allowance, for rules on the allowability of use allowances or
depreciation on buildings,capital improvements,and equipment.Also, see section 37,Rental
costs,concerning the allowability of rental costs for land,buildings, and equipment.
(6)The unamortized portion of any equipment written off as a result of a change in capitalization
levels.may be recovered by continuing to claim the otherwise allowable use allowances or
depreciation on the equipment,or by amortizing the amount to be written off over a period of
years negotiated with the cognizant agency.
(7)When replacing equipment purchased in whole or in part with Federal funds,the
governmental unit may use the equipment to be replaced as a trade-in or sell the property and use
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