enterprise asset management cub meeting november 14, 2012 das surplus property program facilitates...
TRANSCRIPT
Enterprise Asset Management CUB meeting November 14, 2012
DAS Surplus Property Programfacilitates the reuse of surplus property for state, local and federal government. We accomplish this by helping our customers dispose of excess assets and offer their surplus for reuse. Proceeds from sales cover operational costs; remaining funds go back to state and local government.
2011 - 2013 Rate Structure
Gross Sales Price Administrative Fee
Personal Property
Up to $100 100%
Above $100 $100 + 50% of remaining sales price up to a maximum charge of $2,000 on any single item
Vehicles and Titled Equipment
Up to $250 100%Above $250 $250 + 25% of remaining sales price up to a maximum charge of
$2,000 on any single item
State Agencies
Gross Sales Price Administrative FeePersonal PropertyUp to $10 100%Above $10 $10 + 20% of remaining sales price with no cap
Vehicles and Titled EquipmentUp to $260 100%Above $260 The greater of $260 or 7% of the final auction value
Local Governments (IGAs)
Slide 1
Pros and Cons of existing structure Pros
Familiar rate structure which is hard coded into existing inventory management software
Cons Does not cover costs – projected program revenue
shortfall of $1,106,673 which can be reduced to a shortfall of $993,726 if the POP is removed
Lack of 60 day operating capital of $605,538K which includes restoring the projected negative cash balance of $157,435
Perception that agencies with a fleet are paying more than their fair share of Surplus Program operational costs
Significant number of financial transactionsSlide 2
Budget Reduction Option Exercise
Reduce eBay expense - $150,000 Eliminate professional services contracts -
$129,903 Reduce office expenses- $40,000 Reduce temporary appointments - $50,720 Reduce inbound shipping for Federal program-
$17,421 Eliminate Administrative Specialist 1 position -
$137,639 Eliminate Truck Driver position - $128,210
Total Reduction of 12.6% = $653,893
Slide 3
Proposal ‘A’ for 2013 - 2015
Apply method as described in ORS 279A.265 (2) {text included in final slide below} – Essentially: The Surplus Property Program would keep the proceeds from all sales, reimburse IGAs, subtract operating costs, and return any remaining funds to agencies based on their percentage of the gross sales.
State Agencies
Local Governments (IGAs)
Slide 4
Gross Sales Price Administrative Fee Effective Rate Increase
Number of Items
Personal Property
Up to $50 100% 100% 1,694
Above $50 $50 + 50% of remaining sales price; no cap 92% 1,523
Vehicles and Titled Equipment $250 + 7% of remaining sales price; no cap 35% 446
Projected results of Proposal ‘A’
Program costs covered
Slide 5
Pros and Cons of Proposal ‘A’ Pros
Ensures program costs are covered Reduces workload for agencies served and for
Program by dramatically reducing financial transactions
Equalizes reimbursements based on use of Program
Cons Withholds reimbursable funds for a longer period
of time than current reimbursement schedule
Slide 6
Proposal ‘B’ for 2013 - 2015State Agencies
Local Governments (IGAs)
Slide 7
Gross Sales Price Administrative Fee Effective Rate Increase
Number of Items
Personal Property
Up to $500 100% 25% 15,530
Above $500 $500 + 50% of remaining sales price up to a maximum charge of $2,000 on a single item
60% 379
Vehicles and Titled Equipment $250 + 25% of remaining sales price up to a maximum charge of $2,000 on any single item
0% 1,539
Gross Sales Price Administrative Fee Effective Rate Increase
Number of Items
Personal Property
Up to $50 100% 100% 1,694
Above $50 $50 + 50% of remaining sales price; no cap 92% 1,523
Vehicles and Titled Equipment $250 + 7% of remaining sales price; no cap 35% 446
Projected results of Proposal ‘B’ Projected increased revenue from State
Agencies of $283,830 Projected revenue increase from IGA business
of $158,944 Projected remaining shortfall of $550,952 to
be addressed by items in the Budget Reduction Option Exercise (slide #3)
Total Impact: $993,726 (covers Program costs)
Slide 8
Pros and Cons of Proposal ‘B’ Pros
Program costs covered by increased rates and program reductions
Increases percentage of program funding that comes from personal property vs. from vehicles
Redirect resources currently allocated to IGA customers and redistribute to outreach/marketing/customer service efforts
Cons Slower customer response time due to loss of
Administrative Specialist 1 position Projected to lose 20% of IGA sales volume because they
can get similar service at lower rates from private entities Significant number of financial transactions
Slide 9
ORS 279A.265 (2)
Slide 11
“The Director of the Oregon Department of Administrative Services may distribute in the form of cash dividends accumulated surpluses in the fund that arise because the charges collected from donees are in excess of the amount necessary to keep the activities under this section and ORS 279A.260 on a self-sustaining basis. The director shall pay the cash dividends to the donees referred to in ORS 279A.260 (1). Any dividend paid under this subsection shall be based on the ratio of the charges collected from each donee during the preceding fiscal year to the total charges collected from all donees for the fiscal year immediately preceding the fiscal year in which the dividend is authorized to be paid.”