7.3.13 – Procedure – Property Disposition
Part 1: Authority. This procedure is established to meet the requirements of Minnesota State System Procedure 7.3.13 to dispose of surplus personal property in an efficient and cost effective manner.
Part 2: Disposition of Assets. This procedure refers to the disposition of unneeded equipment and supplies to obtain the optimal financial outcome for Lake Superior College (LSC). LSC, as a State of Minnesota entity, may not donate equipment to another organization including public schools or other non-profit organizations outside of Minnesota State Colleges and Universities without first attempting to sell the item to the general public as described below.
Part 3: Objective. An efficient sale or disposal of surplus property requires coordination and cooperation between several areas including the department no longer needing the item(s), maintenance, and the business services office. The sale or disposal of surplus property may include items recorded as fixed assets with an asset tag number, non-fixed assets, and/or supplies. In order to ensure the sale follows all policies and procedures regarding accounting for fixed assets and sales revenue, the following steps must be completed in the order listed.
Subpart A: Property Disposition Authorization Form
Complete a Property Disposition Authorization form available on the business services office web portal page. To include:
- Complete description
- Asset tag numbers, if available
- Serial numbers, if tag numbers are missing
- Estimated market value
- Recommended disposition (trash, recycle, sell, sell for scrap, transfer to another department, cold storage until a specific date)
- Obtain authorization from the director or dean of the department
- Obtain approval from one of the following: Vice President of Administration, Vice President of Academic & Student Affairs, President, or Director of Business Services
- Submit to Purchasing
Disposition approval must be obtained before the item is placed on the Minnesota State ListServ or advertised for sale.
Subpart B: Storage
Property Disposition Authorization form of unneeded items should be completed before the items are moved to the loading dock, cold storage or the basement storage.
- Storage needs to be for a defined period of time.
- Items are frequently ruined in cold storage, particularly if they are made out of or include fabric, laminate, paper, etc.
Subpart C: Disposal Process
- Purchasing offers items to other LSC departments as appropriate.
- If there are no interested LSC departments, Purchasing offers the item to other Minnesota State institutions.
- A determination needs to be made as to the current market value of the item(s), if any, to LSC.
- If there is an expected market value to the item being disposed, the asking price (or best offer) should be included in the Minnesota State Purchasing ListServ.
- We are not required to transfer assets to another Minnesota State institution for free, if we believe it can be sold.
- While there is no specified length of time for the Minnesota State posting, one week is a standard response time.
- Offer for sale to the general public by sealed bids, public auction, fixed selling price, negotiated sale, pre-priced garage sale, consignment, online sales site or similar selling methods.
- In the event there is a publicly advertised auction sale, the public will have the opportunity to inspect the property within a reasonable period of time.
- All items disposed of will have no implied warranty and will be disposed of in an “AS IS” condition at the time of viewing.
- Purchasing should obtain approval for any advertising expense in advance from the Directory of Business Services or the Vice President of Administration.
- Items offered for sale cannot be purchased by State of Minnesota employees unless the sale is on a closed bid basis to the highest bidder.
Subpart D: Sale
- Item is sold:
- Deposits are made to object code 9701 according to the Minnesota State Accounting Procedure for Capital Asset Sales.
- Deposits are credited to an administrative cost center; any exceptions need to be approved by the Vice President of Administration.
- Item is not sold:
- Disposition of any items remaining will be determined by the Vice President of Administration, Director of Business Services, or the President.
- Items may be donated, recycled, trashed or held for future sale.
- If there is significant potential resale value, item may be brought to the cold storage shed or basement storage to wait for the next campus sale.
- Department disposing of asset works with Maintenance to determine where any unsold item(s) will be transported and also communicates this information to Purchasing.
- Maintenance staff shall use their best judgment to store only items with resale value.
Subpart E: Record Keeping
- Purchasing updates the equipment records in ISRS.
- Purchasing maintains records of all inventory disposals according to the LSC Retention Policy.
Part 4: State Employees
In accordance with Minn. Stat. §15.054 no state employee shall sell or give away to any other state employee any personal property or materials owned by the state except such items may be sold to a state employee after reasonable public notice at a public auction or by sealed bid if the state employee is the highest bidder and is not directly involved in the auction or sealed bid process. A state employee may purchase no more than one motor vehicle from the state in any 12-month period. A person violating Minn. Stat. §15.054 is guilty of a misdemeanor. This does not apply to the sale of personal property or materials acquired or produced by the state for sale to the general public in ordinary course of business. State employees are not prohibited from selling or possessing for sale public property if the sale or possession for sale is in the normal course of the employee’s duties.
Date Implemented: December 18, 2014