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December 16, 1991
I. PURPOSE
This bulletin establishes the basic guidelines governing the acquisition
and disposition of University vehicles.
II. REFERENCES
Business and Finance Bulletin A-47, University Direct Costing Procedures
Business and Finance Bulletin A-51, Application of Proceeds from the
Sale, Trade-In or Transfer of University Property
Business and Finance Bulletin A-59, Costing and Working Capital for
Auxiliary and Service Enterprises
Business and Finance Bulletin BUS-38, Disposal of Excess Material and
Transfer of Federally-Funded University-Owned Material
Business and Finance Bulletin BUS-43, Materiel Management
Business and Finance Bulletin BUS-46, Use of University Vehicles
Business and Finance Bulletin G-38, Tax Exemption and Refund Claims
Filing for Property Leased by the University
Accounting Manual Chapter L-217-11: Accounting and Reporting for Leases
and Installment Purchase Contracts
Facilities Manual, Volume 6 - Energy Conservation
Letter from President Gardner to Chancellors and Laboratory Directors,
August 8, 1985, Delegation of Authority
Execution of Purchase Contracts,
Subcontracts, and Standard Purchase
Orders for Goods and Services to be
Supplied to the University (DA 0878)
III. DEFINITIONS
A. Alternative/Clean Fuel Vehicles - Vehicles which operate on
alternative/clean fuels other than gasoline or diesel fuel. Clean
fuel is defined by the State of California pursuant to the
California Health and Safety Codes as including, but not limited
to, methanol, compressed natural gas, electric power, and
liquefied petroleum gas.
B. Campus Working Capital Fund - A fund established at each campus for
the purpose of meeting working capital requirements of service
activities as provided in Business and Finance Bulletin A-59,
Costing and Working Capital for Auxiliary and Service Enterprises.
C. Conditional Sales Contract - A written contract executed between the
buyer and the seller containing the essential terms and conditions
under which the buyer takes possession and the right to use the
personal property, although the seller retains the title to the
property as security until payment is made, at which time title
passes to buyer.
D. Fleet Operation Reserve - A reserve that may be established at each
campus by setting prices above costs as provided in Business and
Finance Bulletin A-59, Costing and Working Capital for Auxiliary
and Service Enterprises. The reserve may be used for current
needs or capital expenditures including equipment, structures, and
renovations.
E. General Purpose Vehicles - Vehicles which are used for the transport
of people or goods. Such vehicles include passenger sedans,
station wagons, carryalls, pickups, vans, 4-wheel drive vehicles,
flat bed trucks, and buses.
F. Lease with Purchase Option - The terms are those of a straight lease
or rental and in addition give the lessee the option to purchase
the property either during the term of the lease or at its
expiration. This definition also applies to any lease in which
all or a portion of the payments may be applied to the purchase of
the property under lease.
G. Low Emission Vehicles - Vehicles which have been or will be
certified by the California Air Resources Board pursuant to the
California Health and Safety Codes pertaining to vehicle emissions.
H. Special Purpose Vehicles - Vehicles which are equipped with specific
special features. Such vehicles include mobile clinics, police
cars, fire apparatus, waste collection vehicles, fork-lifts,
electric carts, farm tractors, motorcycles and motor scooters.
I. Straight Lease or Rental - A written contract executed by a lessee
and lessor containing the essential terms and conditions under
which the use and possession of personal property is to be
furnished in exchange for the payment of rent during the term of
the contract. At the end of the contract term, the property must
be returned to the lessor at the place agreed to by the parties.
IV. AUTHORITY AND RESPONSIBILITY FOR ACQUISITION AND DISPOSITION OF
VEHICLES
Only Fleet Administration/Central Garage on each campus has the
authority and responsibility for acquisition and disposition of campus
vehicles, except that the Division of Agriculture and Natural Resources
shall have the authority and responsibility for acquisition and
disposition of Division vehicles. Any decision concerning acquisition,
or disposition of vehicles should include consideration of the
following:
A. Acquisition
1. Does the current fleet size meet user demand?
2. Can necessary specific functions be performed by existing fleet
vehicle(s)?
3. Should the existing vehicle(s) be replaced for safety or other
reasons?
B. Disposition
1. Would continued operation of a vehicle(s) be unsafe?
2. Would continued operation of a vehicle(s) not be cost effective?
3. Is a vehicle(s) no longer able to serve the purpose for which
it was acquired and, if not, can it be converted to another use?
4. Does the fleet size exceed demand and is a reduction of the
fleet size appropriate?
V. ACQUISITION OF VEHICLES
A. Purchase of New Vehicles Shall be Subject to the Following Conditions
1. New general purpose vehicles, whether to be operated by the campus
Fleet Administration/Central Garage or other campus department,
regardless of the source of financing, shall be purchased in
accordance with the provisions of the Planned Purchase Program
through participation in the State of California Cooperative
Purchasing Program or by quotations obtained by the Vehicle
Commodity Manager, except that vehicles purchased under the
Executive Vehicle Program shall be exempt from these regulations;
2. Special purpose vehicles, alternative fuel vehicles, or vehicles
purchased to meet special situations may be purchased as a local
campus transaction, so long as such transaction is coordinated,
in advance, with the Vehicle Commodity Manager;
3. Purchase orders for lease/purchase and conditional sales contracts
can be accomplished under the State of California Cooperative
Purchasing Program if the title to the vehicle(s) will pass to
the University at completion of the contract period. The State
shall receive the University's purchase order which will be
assigned to the third party.
B. Purchase of Used Vehicles Shall be a Local Transaction
Any decision to purchase used vehicles should include consideration
of the following, and approval must be obtained from the Vehicle
Commodity Manager prior to the transaction:
1. Does the cost of a used vehicle(s) compare favorably with that of
a new vehicle purchased through the State Cooperative Purchasing
Program?
2. Does the vehicle(s) closely approximate the specifications
(including Environmental Protection Agency (EPA) and the
California Bureau of Automotive Repair (CBAR) standards for the
year of manufacture) for vehicles purchased through the State
Cooperative Purchasing Program?
3. Will the vehicle be used as an undercover police vehicle?
C. Rental Lease-No-Purchase Option
Any decision to rent/lease vehicles should include consideration of
the following:
1. Is the rental/lease contract cost-effective?
2. Are funds for out-right purchase not available?
3. Does the vehicle(s) closely approximate the specifications (EPA
and CBAR) for the year of manufacture for vehicle(s) purchased
through the State Cooperative Purchasing Program?
VI. FINANCING THE PURCHASE OF VEHICLES
A. The sources of financing for vehicles are:
1. Campus Working Capital Fund;
2. Fleet operation reserves; and
3. Other appropriate campus funds.
VII. DISPOSITION OF VEHICLES
Disposition of vehicles will be in accordance with the provisions of
Business and Finance Bulletin BUS-38, Disposal of Excess Material and
Transfer of Federally-Funded University-Owned Material, and Business and
Finance Bulletin A-51, Application of Proceeds from the Sale, Trade-In
or Transfer of University Property. Proceeds of the sale may be
deposited in a fleet operations reserve established as provided in A-59,
Costing and Working Capital for Auxiliary and Service Enterprises, or
in the Campus Working Capital Fund.
VIII. FUEL ECONOMY
The University of California is committed to energy conservation and
environmental protection. Campuses should support fuel conservation
and air quality control efforts through acquisition or lease of
low-emission vehicles and/or vehicles which utilize alternative/clean
fuels whenever feasible, depending on the intended usage,
availability of fuel, and cost effectiveness.
IX. DEPRECIATION OF VEHICLES
A. Each campus is responsible for establishing a depreciation schedule
for each vehicle which reflects estimated annual market and salvage
values. Either the sum-of-the-years digits or the straight-line
method may be used. The depreciation schedule shall commence on
the first day of the month following acquisition of the vehicle and
continue through the end of the month of disposition.
B. Vehicle depreciation schedules may be modified upon approval of the
Chancellor after determination that the new depreciation schedules
are in conformance with accepted accounting methods and practices.
C. Funds generated from depreciation charges may be utilized in the same
manner as funds obtained through the disposition of vehicles.
X. RESPONSIBILITIES
A. Chancellors are Responsible For:
1. Determining the number of replacement or additional vehicles
needed;
2. Determining the specification for the new or used vehicles;
3. Obtaining vehicles in accordance with these guidelines;
4. Establishing vehicle depreciation schedules in accordance with
accepted accounting methods;
5. Disposing of vehicles in accordance with BUS-38, and A-51; and
6. Providing data on a variety of vehicle related issues on an ad
hoc basis.
B. The Vehicle Commodity Manager is Responsible For:
1. Obtaining vehicles in accordance with these guidelines;
2. Obtaining vehicles which meet specifications of the EPA and CBAR;
3. Approving exceptions to the Planned Purchasing Program;
4. Notifying campuses, in a timely manner, of the annual deadlines
for participation in the Planned Purchasing Program;
5. Monitoring the progress of the annual purchase request and
notifying campuses if delays occur; and
6. Advising campuses of special purchase opportunities.
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