Agencies waste federal money and the value of unused government property when they fail to properly track, list, identify, and get rid of extra personal property. For instance, an agency might buy something it could have gotten for free from another agency’s surplus. The government also spends more money on storage when agencies keep personal property they don’t need, and it loses out on potential sales revenue.
According to the Federal Personal Property Management Act of 2018 (Public Law 115-419), agencies must:
- Count capitalized assets once a year; and
- Count accountable assets on a regular schedule.
For both counts, agencies need to check:
- How old the personal property is and what condition it’s in.
- How much the agency uses the personal property and determine if it’s excess—a good inventory is key to identifying excess property.
- How much the agency’s mission relies on the personal property.
- Anything else the agency head thinks is important or necessary to review.
We suggest that agencies count their accountable assets (those that must be tracked but are not capitalized, or that are easy to steal, or that fall under a special category requiring more frequent counts) at least once every three years. Agencies can do the count all at once or in stages over the inventory period. The agency’s rules and procedures should explain how to check on the points above and how to handle any differences or problems found during the count.
Agencies can use electronic “discovery tools” to scan their networks and see what electronic devices are present and in use as part of the inventory. However, as part of, or in addition to, the inventory, trained property managers should physically check or view the assigned personal property to see if it is being used, if it is clearly damaged, or if it needs fixing.
We also advise that agency inventory procedures include reasons for keeping property in a warehouse past a certain time and that they review inventory data afterward to spot potential excess. Agencies should not store or hold onto items they do not need but should declare them as excess as soon as possible.
Federal regulation 41 CFR 102-36.10, Agency Responsibilities, requires agencies to get the most use out of personal property and create a system to stop non-use and identify surplus. Agencies should know that inventories are not the only way to find excess personal property. However, since the Federal Personal Property Management Act of 2018 (Pub. Law 115-419) requires regular inventories, it is an efficient way to find excess at the same time. Agencies can also use other regular checks to find excess, such as manager walk-throughs, routine property custodian checks, utilization surveys, or other methods.