Section 0690-01-01-.07 - COMPLIANCE AND UTILIZATION(1)Items Subject to Compliance Review. The terms, conditions, reservations, and restrictions under which Federal surplus property is donated are stated on the reverse of the property issue document. The State Agency shall conduct utilization reviews for donee compliance on items with a unit acquisition cost of $3,000 or more and on passenger motor vehicles. Also, reviews will include items of property on which the Administrator of GSA imposes restrictions for special handling and use limitations defined in Rule 0690-1-1-.06, Terms and Conditions on Donable Property. Major items of equipment on which the State Agency imposes special use restrictions will be of major interest in the reviews.(2)Procedures for Conducting Utilization Reviews(a)Compliance Memorandum. It shall be the policy of the State Agency to require a written utilization report from each donee who has acquired an item of property having a unit acquisition cost of $3,000 or more, a passenger motor vehicle, or certain items on which GSA has imposed special handling and use limitations. After posting invoice to donee ledger card, utilization inquiry letter is mailed in duplicate to donee. Satisfactory replies, reflecting specific date restrictive item is placed into use, or to be placed into use, location, etc. are filed in respective donee restrictive item folder. Non-response and insufficient reply cases are sent follow-up letter six months from date of first letter. If after 30 days no reply or unsatisfactory reply, cases are referred to Director for personal visit by State Agency representative.(b)Physical Inspections. State Agency personnel will physically inspect during the period of restriction any major item of property on which the State Agency has imposed a special use limitation. During such visits, State Agency personnel will spot check other items of surplus property acquired with special emphasis on any items with special handling and use limitations imposed on it by GSA.(c)Report of Cannibalization. A report shall be required on items with a unit acquisition cost of $3,000 or more and passenger motor vehicles on which cannibalization has been authorized to determine if the cannibalization has been performed and if any remaining component is valued at $3,000 or more.(3)Compliance Actions(a) Administrative compliance remedies in cases of non-use, misuse, or unauthorized disposal of donated property which had a unit acquisition cost of $3,000 or more, passenger motor vehicles, or property distributed with special conditions or restrictions will be undertaken as follows:1. Whenever possible and practicable, the property will be placed into eligible use by the present donee, transferred to another eligible donee, or returned to the State Agency.2. When it has been determined that property has been ineligibly used, demand will be made of the donee organization to pay to the State Agency or to the U.S. Government, in cases where the Federal conditions have been violated, fair rental value for the time the property was ineligibly used.3. If property has been disposed of and cannot be reclaimed for further use, or if property is worn or damaged so as to render it unfit for further use, the donee organization will be liable for fair market value as described above.(b) A full investigation will be conducted when there is evidence that suggests possible property compliance violations. A complete report will be filed with the Regional Office of GSA describing the results of the investigation if any compliance action is taken.(c) When fraud in the acquisition of donable property is alleged or suspected, a report containing all available information will be made to the FBI, with notification to the GSA regional office. Local law enforcement officials will be advised of any violations of State restrictions. The State Agency will take necessary actions to prosecute cases of fraud or misuse of donated property and will assist GSA or other responsible Federal or State officials in investigating such cases upon request.Tenn. Comp. R. & Regs. 0690-01-01-.07
Original Rule filed August 31, 1977, effective September 30, 1977.Authority: T.C.A. Sections 4-330-(15), 12-333(5A), and 49-808 through 49-810. See also Public Law No. 94-519.