Financial Policies

FN14 Use of University Tangible Non-Capital Property, Capital Property, Supplies and University Services

Policy Status: 

Under Review

Subject Matter Expert: 

Manager, Property Inventory, 814-863-1378

Policy Steward: 

Associate Vice President for Budget and Finance

Table of Contents:

  • PURPOSE
  • SCOPE
  • DEFINITIONS
  • POLICY
  • REPORTING NON-COMPLIANCE
  • SANCTIONS
  • FURTHER INFORMATION
  • CROSS REFERENCES
  • POLICY STATUS
  • PURPOSE:

    This policy governs The Pennsylvania State University (“University” or “Penn State”) use of University tangible non-capital property, capital property, supplies, and services and fulfills the Office of Budget and Finance mission of providing quality financial, accounting, and information services that foster a culture of responsible stewardship and sound fiscal management of University resources.

    SCOPE:

    The University’s financial policies are applicable throughout the University, including all direct and indirect subsidiaries, and are required to be followed by all University employees who engage in financial, accounting, purchasing, or other transactions, including University employees who in the course of their assigned duties engage in such transactions on behalf of third parties such at the Penn State Alumni Association or other related entities. The University’s financial policies are not applicable to Penn State Health or its subsidiaries, or to Penn College of Technology, each of which has its own financial policies.

    DEFINITIONS:

    • Capital expenditures - expenditures to acquire capital assets or expenditures to make additions, improvements, modifications, replacements, rearrangements, reinstallations, renovations, or alterations to capital assets that materially increase their value or useful life.
    • Equipment - tangible personal property (including information technology systems) having a useful life of more than one year and a per-unit acquisition cost which equals or exceeds the lesser of the capitalization level established by the University for financial statement purposes, or $5,000.
    • Supplies – means all tangible personal property other than those described in the definition of equipment in this section. A computing device is a supply if the acquisition cost is less than the lesser of the capitalization level established by the University for financial statement purposes or $5,000, regardless of the length of its useful life.
    • Tangible Property – an item having a finite monetary value, usually in a physical form (can be seen, felt, or touched), depreciated or used over a period of time, possessing a scrap or residual value, and are used in the daily operations of the University.

    POLICY:

    Property owned by Penn State has value to the institution. As such, there is a fiduciary obligation to provide proper oversight and ensure its usage continues to benefit the University, or to recover its fair market value.

    Property purchased through grants and contracts belongs to either the sponsor or the University, and proper transfer of title and recovery of value for either the sponsor or the University must be ensured. This is always critically important, but especially with assets purchased through federally sponsored awards.

    An educational institution’s tax exemption status is based in part on the condition that no part of its property inures to the benefit of private individuals or for-profit companies.

    University tangible non-capital property, capital property, supplies, and University services may not be used for personal gain by an employee for purposes outside the scope of their employment (see Policy AC80 Outside Business Activities and Private Consulting and/or Policy HR91 Conflict of Interest), or by students beyond their instructional requirements. University resources are to be used for University business.

    University tangible non-capital property, capital property, supplies, being used or placed in storage at another non-University location must have an agreement or Memorandum of Understanding (MOU) with that facility to ensure the safeguarding of such property. The comingling of University property with other property not belonging to the University must be avoided. All University property placed or stored at non-University locations must be secured when not in use.

    TANGIBLE NON-CAPITAL PROPERTY:

    All tangible non-capital property owned, leased, or operated by the University are to be used in the conduct of University programs and activities at University owned or leased locations. Non-capital property has a value of less than $5,000.

    CAPITAL PROPERTY:

    This policy and Policy RA70 Research Administration Property & Equipment requires the maintenance of records and the protection of capital assets (equipment and facilities/property) acquired by the University used in the conduct of University programs and activities.

    Capital assets have an acquisition cost of at least $5,000, have an estimated life of at least one (1) year, and are procured using a capital general ledger account. Accounting standards and federal regulations require the University to identify and control the location, use, and status of capital equipment. Property Inventory, a division of the Office of the Office of Budget and Finance, is responsible for recording and maintaining records of all capital assets purchased through the University’s procurement system. See Procedure CR2019 Accounting for Capital and Non-Capital Property (Equipment and Facilities) for details on accounting for capital equipment and CR2020 Property Fabrication for details on accounting for fabricated property.

    University departments are responsible for:

    1. notifying Property Inventory of equipment location changes and/or disposition;
    2. assisting Property Inventory in the perpetual inventory process in a timely manner;
    3. providing reasonable safeguards to protect assets from theft, damage, etc.; and
    4. providing reasonable maintenance to ensure proper asset functionality (including cost of parts and labor).

    SUPPLIES:

    An employee may take general office supplies to support their work while working at an off-campus research location or while working from home. Any unused supply item must be returned to the employee’s normal on-campus location.

    UNIVERSITY SERVICES:

    University departments may offer services only to other University departments and only for University-related work. Rates for this work must be approved by the Associate Vice President for Budget and  Finance (See Policy FN27 Establishing and Billing Service Center User Rates and Policy FN16 Obtaining Goods and/or Services from Other University Departments). Permitted work includes:

    • instructional work for credit and non-credit courses, conferences, workshops, institutes, training programs, etc. (see Policy BT06 Course-Related Fees Approval);
    • support for faculty research, publications, presentations, and outreach activities;
    • services for recognized student organizations; and
    • services for other organized student extramural activities.

    Providing services to an outside audience (non-University related or commercial) is prohibited unless the service is commercially unavailable within the region of a campus and has the prior written approval of the Associate Vice President for Budget and Finance. In such cases the unit must provide clear rationale why the University is providing this service to the commercial sector. In general, services being provided which are also provided commercially must be fully costed, including the application of fringe and overhead. Auxiliary Enterprise units are exempt from this prohibition for purposes of this policy. Units operating as University Services or through general funds can obtain permission through the process established in Policy FN27 Establishing and Billing Service Center User Rates.

    EXCEPTIONS FOR USE OF UNIVERSITY EQUIPMENT, STAFF, AND SERVICES:

    The following are further policy statements regarding the personal use of University staff and services:

    • EMAIL, INTERNET, AND PHONE SERVICES - The use of email, internet, and office phone services for reasonable personal use is permitted if the University incurs no additional incremental cost for personal use.
      • These services may never be used in the conduct of a personal business or any other for-profit venture from which the employee (or member of their family) would receive personal gain.
      • Employees may not use these services for personal use if additional costs are incurred (i.e., long-distance phone calls). If incremental charges are incurred, the University must be reimbursed for the cost.
      • Reasonable personal phone calls and faxes may be permitted at the discretion of the budget executive or budget administrator, and if authorized, any tolls and extra charges must be reimbursed by the employee to the University cost center or internal order charged for the initial service.
      • Excessive personal use which interferes with the employee's job performance is not appropriate and can be limited as needed by supervisors to assure employee productivity.
    • UNIVERSITY EQUIPMENT - The use of University-owned equipment for personal use is generally not permitted, except for technology equipment used for reasonable personal use as noted above.
      • University-owned technology equipment, such as computers, printers, smartphones, and notepads, may be permitted to be housed at an employee's home, but only if there is a business need for the use of that equipment at home and appropriate accountability forms are completed. See Policy HR107 Staff Flexible Work Arrangements for complete details.
    • UNIVERSITY EMPLOYEES - The use of University employees for services that would be considered personal, such as running errands or typing personal documents, is not permitted.
    • UNIVERSITY FACILITIES - The use of non-public University facilities (those not available to the general public) for personal meetings or family events (see AD02 Non-University Groups Using University Facilities for additional policy statements) is not permitted.

    Policy AD06 Community Charity Solicitation of University Employees outlines the specific exception for the use of services by a non-University entity.

    USING UNIVERSITY PROPERTY AWAY FROM THE UNIVERSITY:

    Occasionally, in the performance of job duties, faculty or staff members may need to use University property at their homes or at another off-campus location. Deans, directors, and department heads are responsible for the control of off-campus use of University property. See Procedure CR2024 Using University Tangible Property Away from the University.

    Each piece of property taken off campus must have either a PSU identification number (property tag) affixed to the property or the serial numbers documented. The Request for Authorization to Use University Tangible Property at Non-University Locations must be completed by the employee, receive the documented recommendation of their supervisor, and the Budget Executive is required to grant authorization for the relocation of University tangible property to non-University locations before property is relocated to an off-campus location. If a department wishes to have a “Property of Penn State University” identification label affixed to items not possessing a Property Inventory tag, contact Property Inventory.

    When traveling Outside the Continental United States (OCONUS) (whether for personal travel or University business travel) with University tangible capital property containing a Property Inventory tag (no matter the length of time), the Request for Authorization to Use University Tangible Property at Non-University Locations must be completed. See Policy TR01 Travel Requirements for Destinations Outside the Continental United States, Procedure CR2019 Accounting for Capital and Non-Capital Property, and Procedure TR2010 Outside the Continental United State Travel Requirements for complete details.

    Other Situations:

    The Request for Authorization to Use University Tangible Property at a Non-University Location form does not have to be completed, nor Property Inventory notified, if:

    1. The property is being relocated between University buildings for less than 30 days for research collaboration.
    2. The property is being transported for relocation to another University location for less than 30 days; however, if the relocation is to last from 30 days up to and including one (1) year, then the Asset Transfer and Retirement form must be completed in SIMBA.
    3. The use of the tangible property is in response to an emergency risking life or property; however, if the situation extends to 30 days, an Asset Transfer and Retirement form must be processed in SIMBA.
    4. When traveling Outside the Continental United States (OCONUS), whether for personal travel or for University business travel, with non-capital equipment. See Policy TR01 Travel Requirements for Destinations Outside the Continental United States, Procedure CR2019 Accounting for Capital and Non-Capital Property, and Procedure TR2010 Outside the Continental United State Travel Requirements for complete details.
    5. The property is being used while working remotely for less than 30 days. If extended beyond 30 days, the Request for Authorization to Use University Tangible Property at Non-University Locations must be completed.

    Complete the Asset Transfer and Retirement form within SIMBA to transfer property from one business area to another; to send equipment to be disposed of through Lion Surplus; to report equipment that is lost, stolen, or destroyed; and/or to return equipment to a customer or sponsor, that was loaned or relocated.

    See Procedure CR2004 Accountability for Transfers of Items of Value (except equipment) for complete details when transferring currency and/or documents.

    GIFTING UNIVERSITY PROPERTY:

    Gifting, or giving away, University property – whether to an individual or to another institution – is generally not permitted. Exceptions include when there is a benefit between the University and another non-profit organization. All exceptions must be approved by the Associate Vice President for Budget and Finance before the property is donated.

    SEPARATION OF EMPLOYMENT:

    To protect both the employee and the University and to maintain official records to determine if University property has been returned from an employee leaving University employment or an off-campus location, an electronic questionnaire, generated through Workday, will be sent to the employee’s manager for completion.

    With the consent of a department, employees wishing to purchase University owned property may work with Lion Surplus to appropriately purchase the item from Penn State based on its fair market value. See Policy BS15 Disposal and Purchase of Obsolete, Surplus, or Scrap University-Owned Equipment, Supplies, and/or Materials and/or Procedure BS2011 Lion Surplus Operation including Sales Store.

    REPORTING NON-COMPLIANCE:

    Employees are encouraged to report instances of noncompliance with this policy. Employees can report concerns or observations of misuse or theft of University property or services to any of the following: the employee's immediate supervisor (unless they are the individual conducting the misuse), Internal Audit, Human Resources’ Labor and Employee Relations team, their Financial Officer or Human Resources Representative, the University's Ethics and Compliance Office and/or University Police. Alternatively, an employee can file a report with the University's Financial and Compliance Hotline at 1-800-560-1637 or at https://psuethicsandcompliance.tnwreports.com/. If an employee reports a concern about or observation of misuse or theft to their immediate supervisor, the supervisor should contact any of the above-named remaining units or individuals. If the Financial Officer or the employee's work unit's Human Resource Representative receives a report from the employee or the employee's supervisor, they should contact Employee Relations, Internal Audit, the Ethics and Compliance Office or University Police.

    When a report of misuse or theft of University property or services is received by Internal Audit, Employee Relations, and the University's Ethics and Compliance Office, they may consult and discuss with each other as necessary to ensure the matter is properly addressed. If a decision is reached that the matter should be turned over to University Police, the Senior Vice President for Finance & Business/Treasurer should be notified concurrently with the referral of the matter to the Assistant Vice President for University Police and Public Safety.

    When a report of misuse or theft of University property or services is received directly by University Police, they shall have sole discretion as to how best to proceed with the investigation of the reported activity to ensure that the matter is appropriately and successfully addressed.

    SANCTIONS:

    Units that do not follow the guidelines set forth in this policy will, at a minimum, be held responsible for any losses.

    FURTHER INFORMATION:

    For questions, additional detail, or to request changes to this policy, please contact Property Inventory, a division of the Office of Budget and Finance.

    CROSS REFERENCES:

    POLICY STATUS:

    MOST RECENT CHANGES:

    • February 1, 2023 - Editorial changes. Changed all references to the Associate Vice President for Finance to the Associate Vice President for Budget and Finance, per the directive of the Senior Vice President for Finance and Business.

    REVISION HISTORY:

    • January 5, 2023 - Editorial changes.
      • Changed all references to the Office of the Corporate Controller to the Office of Budget and Finance, per the directive of the Associate Vice President for Finance.
      • Policy status changed to "under review" at the request of Transportation Services.  
    • September 2, 2022 - Editorial change to change Policy Steward from Associate Vice President for Finance and Corporate Controller to Associate Vice President for Finance.
    • February 15, 2022 - policy rewritten to address SIMBA and Workday system implementations.
    • November 8, 2018 - Editorial change to add Subject Matter Expert
    • September 13, 2018 - Editorial changes to update Cross References section and to remove redundant Date Approved, Date Published, and Effective Date information.
    • June 17, 2016 - Revision in paragraph #2 of the REPORTING NONCOMPLIANCE section, clarifying the process/notification requirements when a decision is made that noncompliance with the policy should be reported.
    • April 7, 2014 - Addition of a REPORTING NONCOMPLIANCE section, to provide guidance to employees for reporting concerns or observations of misuse or theft of University assets or services.
    • September 27, 2013 - Editorial changes. Addition of policy steward information, in the event that there are questions or requests for changes to the policy.
    • August 6, 2009 - Verbiage discussing the use of University tangible assets, supplies and services was moved from Policy FN10 and incorporated into the POLICY section of this policy.
    • June 14, 2006 - Revision History added.
    • May 9, 2005:
      • Editorial changes to eliminate "General Forms Usage Guide" references, and to add the correct links for the forms referenced in the policy.
      • Corrected old link to Policy AD37; replaced with correct link to RA12 to reflect transfer of this policy to the Research Policy section of GURU.
    • February 2, 1998 - Addressed personal phone calls and faxes.
    • August 12, 1996 - The POLICY section revised to clarify to whom University departments may offer their services.
    • March 12, 1993 - Expanded title of the policy to include equipment and supplies.
    • November 24, 1992 - Policy revised, renumbered and relocated from AD12.
    • August 24, 1990 - Form title change; reference to "Request for Authorization to use University Equipment at a Non-University Location" is now retitled (now says University Assets instead of Equipment).
    • December 10, 1988 - Revision to "Exceptions" section, per Office of Naval Research review of University's Property System.
    • November 15, 1981 - Policy title change to "Use of University Equipment, Supplies, and services" (Formerly Materials).

    Date Approved: 

    February 15, 2022

    Date Published: 

    February 15, 2022

    Effective Date: 

    February 16, 2022