Att 1C_45_CFR_96[1]

Department of Health and Human Services
computed in accordance with the cost
principles precribed in subpart Q of 45
CFR part 74.
(b) Exceptions. (1) Equipment purchased under service agreements with
other State agencies and under costtype contracts shall be depreciated.
However, equipment having a unit acquisition cost of $25,000 or less may be
claimed in the period acquired if (a)
the State agency approved the specific
purchase and the claiming of the cost
of the item, and (b) the contract or
service agreement requires that the
equipment or its residual value be
transferred to the State agency when
the equipment is no longer needed to
carry out the work under the contract
or service agreement.
(2) Reimbursement for ADP equipment having an acquisition cost in excess of $25,000 and subject to subpart F
of this part must be depreciated over
its useful life unless otherwise specifically provided for by the Department.
ADP equipment not subject to subpart
F is subject to the requirements of this
subpart.
§ 95.707 Equipment management and
disposition.
(a) An item of equipment is subject
to the property rules in subpart O of 45
CFR part 74 if the total cost of the
item was claimed in the period acquired and if the item was accepted for
Federal financial participation as a direct cost under a single program or
program activity. These rules also
apply to ADP equipment where the
State agency was permitted under Subpart F of this part to claim the total
cost of the equipment in the period acquired.
(b) Other items of equipment whose
costs are claimed for Federal financial
participation (i.e., equipment that is
capitalized and depreciated or is
claimed in the period acquired and
charged to more than one program) are
not subject to the specific requirements in subpart O of 45 CFR part 74.
However, the State agency is responsible for adequately managing the
equipment, maintaining records on the
equipment, and taking periodic physical inventories. Physical inventories
may be made on the basis of statistical
sampling. The following requirements

Pt. 96

apply to the disposition of this equipment:
(1) If the cost of the equipment was
claimed in the period acquired and the
equipment is later sold, the proceeds of
the sale shall be credited to current expenditures in approximate proportion
to the distribution of the equipment’s
cost.
(2) If the cost of the equipment was
claimed in the period acquired and the
equipment is later transferred to an activity which is not involved in the performance of programs currently or previously funded by the Federal Government, an amount equal to the fair market value of the equipment on the date
of the transfer shall be credited to current expenditures in approximate proportion to the distribution of the
equipment’s costs.
(3) If the cost of the equipment was
claimed in the period acquired and the
equipment is later traded in on other
equipment claims for Federal financial
participation in the costs of replacement equipment shall be limited to the
additional outlay.
(4) If the equipment was depreciated,
any gain or loss on the disposition of
the equipment shall be treated as a decrease or an increase to the depreciation expense of the period in which the
disposition takes place. This provision
does not apply to equipment whose
costs were claimed for Federal financial participation through use allowances.

PART 96—BLOCK GRANTS
Subpart A—Introduction
Sec.
96.1 Scope.
96.2 Definitions.
96.3 Information collection approval numbers.

Subpart B—General Procedures
96.10 Prerequisites to obtain block grant
funds.
96.11 Basis of award to the States.
96.12 Grant payment.
96.13 Reallotments.
96.14 Time period for obligation and expenditure of grant funds.
96.15 Waivers.
96.16 Applicability of title XVII of the Reconciliation Act (31 U.S.C. 7301–7305).
96.17 Annual reporting requirements.

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