1. (1) This rule applies to items of real property, equipment, supplies and to items of intellectual property as defined in Sections 815.03(10) and 815.03(11), F.S., which are acquired with State support. To be considered acquired with State support, some or all of the items’ acquisition cost must be both:

   1. (a) An allowable cost within the SAMH-Funded Entity’s Line Item Operating Budget; and,
   2. (b) Either directly supported by substance abuse and mental health funds or included in the SAMH-Funded Entity’s match requirement valuation in compliance with Rule 65E-14.005, F.A.C.
2. (2) If a SAMH-funded entity acquires, remodels, constructs, improves or expands real property with State support, the department shall be entitled to recover an amount bearing the same ratio as determined by contract, subcontract or other funding agreement to the current value of the property. This right shall remain for twenty years after the acquisition, remodeling, construction, improvement or expansion is completed.

3. (3) This rule does not apply to:

   1. (a) Property for which only depreciation or interest is charged, or
   2. (b) Property donated entirely as a third-party in-kind contribution and not used toward satisfying a matching requirement.
4. (4) SAMH-Funded Entities may follow their own property management policies and procedures provided such policies and procedures observe the requirements of this rule.
5. (5) Title to Real Property, Equipment, and Supplies. Subject to the obligations and conditions set forth in this rule, title to real property, equipment, supplies and intellectual property acquired with State support shall vest, upon acquisition, in the SAMH-Funded Entity unless otherwise specified in terms of the contract or subcontract.

6. (6) Real Property. Property subject to this rule shall be subject to the following requirements, in addition to any other requirements imposed by contract or subcontract terms:

   1. (a) Use.

      1. So long as the property is owned by the same SAMH-Funded Entity or its successor in law, it must be used for the originally authorized purpose for a period of twenty years or for as long as specifically authorized for that purpose, whichever is less.

      2. If the property is no longer needed for the authorized purpose in less than 20 years, the SAMH-Funded Entity may request approval from the department to use the property for alternative purposes. Allowable alternative purposes shall be limited to:

      a. Services, programs or projects supported by other State contracts; and,

      b. Activities not supported by other State contracts but having purposes consistent with the original authorized purpose.

      3. The department shall no longer have a claim to property held by the same SAMH-Funded Entity for the original or an approved alternative purpose after twenty years.

   2. (b) Transfer of Title. A SAMH-Funded Entity may request department approval to transfer title to an eligible third party for continued use for authorized purposes in accordance with paragraph (6)(a), of this rule. If approved, the terms of the transfer shall provide that the transferee shall assume all the rights and obligations of the transferor set forth in this rule or in other contract or subcontract terms.

   3. (c) Disposition. When the real property is no longer to be used as provided in paragraphs (6)(a) and (b), of this rule, the SAMH-Funded Entity shall either:

      1. Sell the property and pay the department an amount computed by multiplying the State’s share of the property times the proceeds from sale, after deducting actual and reasonable expenses related to the sale, including repairs, if needed, from the sale’s proceeds, or

      2. Retain title to the property and pay the department an amount computed by multiplying the fair market value of the property by the State’s share of the property.

7. (7) Real Property Records and Management.

   1. (a) Real property records shall be maintained accurately and shall include the following minimum requirements:

      1. A legal description of the property including any physical location address, building situated thereon as well as any other improvement,

      2. Identification of the contract, subcontract or other funding agreement under which the recipient acquired the property and the authorized purpose for which the property will be used,

      3. The information needed to calculate the State’s share of the property,

      4. Acquisition date and all elements of the cost of the property,

      5. Condition of the property at acquisition; and,

      6. The date information in subparagraphs (7)(a)1. through 5., of this rule, was reported to the department.

   2. (b) A control system and maintenance procedures shall be in effect to prevent damage or loss of the property. Any loss or damage shall be investigated and fully documented.
   3. (c) Where property is to be sold and the State is entitled to all or part of the proceeds, the department shall establish procedures for the conduct of the sale.

8. (8) Equipment and Supplies.

   1. (a) Use of Equipment: A SAMH-Funded Entity shall use any equipment acquired with State support in the program for which it was acquired. In the event equipment is no longer needed for the original program, the SAMH-Funded Entity shall request department approval to use the equipment, if needed, in other programs currently or previously sponsored by the department.
   2. (b) The useful life of equipment shall be determined at the time of its acquisition and be specified in contract, subcontract or other funding document. In case of a sale or transfer of the purchased equipment, the department shall be entitled to recover the same ratio to the then value of the item for the period of time specified as useful life. The department will have no interest in the item beyond the period of time specified as useful life.
   3. (c) Use by Other Entities. When the SAMH-Funded Entity can no longer use the equipment as required by paragraph (6)(a), of this rule, it may request department approval to make the item available to other entities for use in programs currently or previously sponsored by the department.

9. (9) Replacement of Equipment.

   1. (a) A SAMH-Funded Entity may exchange equipment for replacement items if needed. If the original item is sold or included as a trade-in for the replacement item, any proceeds realized shall be applied to the acquisition cost of the replacement item and the transaction shall be one which a prudent person would make in like circumstances.
   2. (b) If the replacement cost includes an additional outlay which is charged as a cost to either State funds or match requirement, the replacement item shall be subject to the same property requirements or exemptions applicable to the original item.

10. (10) Disposition of Equipment. When original or replacement equipment is no longer to be used in programs currently or previously sponsored by the department, a SAMH-Funded Entity shall dispose of the item as follows:

    1. (a) The entity may retain or sell the item and shall notify the department in advance of such actions.

       1. If the item is retained, the department shall have a right to an amount calculated by multiplying the current market value by the State’s share of the item.

       2. If the item is sold, the department shall have a right to an amount calculated by multiplying the proceeds from the sale by the State’s share of the item. Expenses related to actual and reasonable expenses related to the sale, not to exceed fifteen percent of the total sale proceeds, may be deducted from the amount otherwise due the department. When the State is entitled to all or part of the proceeds, the department shall establish procedures for the conduct of the sale.

    2. (b) Equipment management requirements. Until disposition takes place, a SAMH-Funded Entity shall comply with the following minimum requirements for managing equipment and any replacement items.

       1. Property records shall be maintained accurately. For each item, the records shall include:

       a. A description of the item including the manufacturer’s model number, if any,

       b. An identification number, such as the manufacturer’s serial number,

       c. Identification of the contract, subcontract or other funding agreement under which the entity acquired the item,

       d. The information needed to calculate the State’s share of the item,

       e. Acquisition date and unit acquisition cost,

       f. Location, use, and condition of the item; and,

       g. The date information in sub-subparagraphs (10)(b)1.a. through f., of this rule, was reported to the department.

       2. A SAMH-Funded Entity shall conduct a physical inventory of equipment and reconcile the results with the property records at least once each State fiscal year to verify the existence, current utilization, and continued need for the item. The SAMH-Funded Entity shall investigate and determine the causes of any differences between the physical inventory and quantities in the accounting records. The SAMH-Funded Entity shall submit a copy of the annual inventory to the Managing Entity or department as appropriate, along with any disposition records, within 30 days after completion of the inventory.

       3. A SAMH-Funded Entity shall implement a control system and maintenance procedures to prevent loss, damage, or theft of equipment. The SAMH-Funded Entity shall investigate and fully document any loss, damage, or theft.

11. (11) Unused Supplies.

    1. (a) This section applies to supplies acquired with State support which have not been used in the program for which they were acquired at the time State support for the program is terminated for any reason.

    2. (b) The SAMH-Funded Entity shall notify the department of the quantity, type and fair market value of unused supplies. If the unused supplies exceed $1,000 in total aggregate fair market value and are not needed for any other program funded by the department, the SAMH-Funded Entity may either retain or sell the supplies, and shall credit the State as follows:

       1. Retained supplies. The credit is computed by multiplying the State’s share of the supplies by their current market value.

       2. Sold supplies. The credit is computed by multiplying the State’s share of the supplies by the proceeds from any sale. Expenses related to actual and reasonable expenses related to the sale, not to exceed fifteen percent of the total sale proceeds, may be deducted from the amount otherwise due the department.

12. (12) Valuation of the State’s Share. Several sections of this rule require a valuation of the State’s share of real property, equipment, supplies or intellectual property acquired with state support. The following methods determine the valuation:

    1. (a) The State’s share of real property equals the amount of State support used to acquire property under a contract, subcontract or other funding agreement, divided by the total acquisition cost of the property. The State’s share is expressed as a percentage. For the purposes of this rule, “costs under a contract, subcontract or other funding agreement” means only allowable costs which are either supported by the funding document or counted towards satisfying an included match requirement. Notwithstanding any conflicting standards in Rule 65E-14.005, F.A.C., the value of third-party in kind contributions may not be included in the valuation of the State’s share.

    2. (b) Replacement equipment. The State’s share of replacement equipment is:

       1. Step 1. Determine the State’s share of the equipment replaced. Divide the amount of State support used to acquire the replacement equipment by the total acquisition cost of the replacement equipment. The total is expressed as a percentage.

       2. Step 2. Determine the percentage of the replacement equipment’s cost that was covered by the amount received for trade-in or the sales proceeds from the equipment replaced.

       3. Step 3. Multiply the step 1 percentage by the step 2 percentage.

       4. Step 4. If an additional outlay for the replacement equipment was charged as a cost either to State funds or to required matching funds, calculate the State’s share attributable to that additional outlay as explained. Add that additional percentage to the step 3 percentage.

13. (13) Copyrights.

    1. (a) Works Under Contracts. Unless otherwise provided by the terms of the contract, a SAMH-Funded Entity may copyright or permit others to copyright, any appropriately copyrightable material developed specifically for or in the course of contract or subcontract performance.
    2. (b) State of Florida Rights. If any copyrightable material is developed specifically for or in the course of contract or subcontract performance, the State of Florida shall have a royalty-free, nonexclusive, and irrevocable right to reproduce, publish, or otherwise use, and to authorize others to use the work for state government purposes. A contractor awarding a subcontract may reserve a similar right for itself with respect to copyrightable material developed.

Rulemaking Authority 273.055, 394.74(1) 394.78(1), 394.9082(3) FS. Law Implemented 273.055, 394.74(2)(c), 394.78(5) FS. History–New 2-23-83, Amended 2-25-85, Formerly 10E-14.10, 10E-14.010, Amended 7-27-14.