December 7, 1995

South Coast Air Quality

Management District Board

AQMD Administrative Policy and Procedure No. 20 establishes procedures for the approval, purchase, tagging, physical inventory, and disposal of fixed asset equipment. In accordance with this policy, staff has previously requested the Governing Board's approval to remove equipment which had been retired, damaged, or reported missing from the inventory of assets.

During July through October 1993, each organizational unit at the AQMD conducted a biennial physical inventory of its equipment. These inventories were observed by Finance staff. A bar code label was affixed to each located fixed asset to improve the speed and accuracy of future inventories. Following the conclusion of this inventory, an additional effort was made to locate assets which were missing and where appropriate, controls were reviewed in an effort to provide better safeguards for assets.

Attachment A is a list of unlocated fixed assets, comprised of both missing and stolen items as determined from the 1994 August and September annual inventory by Applied Science and Technology (AST), as well as assets unlocated from the 1991 Districtwide fixed asset inventory and the 1992 AST inventory. All assets listed as stolen were reported to the police.

Attachment A has been sorted to reflect which items were determined to be missing or stolen before and after the October 1991 Headquarters move from El Monte to Diamond Bar. The attachment also reflects the results of an independent appraiser's valuation of all unlocated items. The current market value is stated next to the recorded value (cost) of the item. A summary of the information in Attachment A appears below:

Original Cost Current Value

Items Missing before the Move $ 25,966.08 $ 730.00

Items Stolen before the Move 59,597.08 4,405.00

Items Missing after the Move 133,935.53 10,125.00

Items Stolen after the Move 22,616.97 4,340.00

Because of the age of the assets, the current value of these missing assets is materially less than the recorded value. Staff recommends that the unlocated items on Attachment A be removed from the AQMD's total equipment inventory of $22,084,839.

The equipment appearing on Attachments B and D represents surplus equipment which has been replaced as part of the AQMD's replenishment program and is no longer of use to the AQMD. Staff is recommending that the equipment on Attachment B, as in the past, be offered to nonprofit and charitable organizations on a first-come, first-served basis and that the equipment on Attachment D be surplused through the salvage process.

Attachment C represents vehicles where the cost to repair and/or maintain due to mechanical breakdown or damage suffered in traffic accidents has become prohibitive. Staff recommends that these vehicles be disposed of through the auction process.

These recommendations were reviewed and approved by the Administrative Committee at its meeting on November 16, 1995.

THEREFORE, IT IS RECOMMENDED THAT YOUR BOARD

--Authorize the removal of the equipment identified on Attachments A, B, C, and D from the AQMD's Equipment Inventory.

--Authorize the transfer of equipment on Attachment B to nonprofit or charitable organizations on first-come, first-served basis.

--Authorize the Purchasing Manager to dispose of the equipment on Attachment C through the auction process.

--Authorize the Purchasing Manager to dispose of the equipment on Attachment D through the salvage process.

Respectfully,

James M. Lents, Ph.D.

Executive Officer

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Attachments

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