1. (a) Generally. If no state agency, political subdivision, or assistance organization desires to receive any property reported as surplus or salvage, the commission may dispose of the property, with the exception of data processing equipment, in a method that is most advantageous to the state and the reporting agency under the circumstances. Commission procedures shall establish guidelines for making this determination.

   1. (1) Disposal. Property not disposed of under §126.3 of this title (relating to Direct Transfer, Priority, Reporting, and other Disposition) may be disposed of by sealed bids, auction, or direct sale to the public, including a sale using an internet auction site.
   2. (2) Delegation of disposal authority. The commission may delegate its authority to dispose of property not disposed of under §126.3 of this title (relating to Direct Transfer, Priority, Reporting, and other Disposition) to a state agency having possession of the property by any method listed in subsection (a)(1) of this section, so long as the method of sale chosen is most advantageous to the state under the circumstances. Commission procedures shall establish guidelines for making this determination. Any delegation under this section shall be subject to the procedures and reporting requirements in §126.2(6) of this title (relating to General Terms and Conditions).
   3. (3) Requirement to advertise. If the value of any property to be disposed of under this section is estimated to be worth more than $5,000, the sale shall be advertised at least one time in at least one newspaper of general circulation in the vicinity in which the property is located.

2. (b) Disposition by competitive sealed bids. Sealed bids will be handled in accordance with §113.5 of this title (relating to Bid Submission, Bid Opening, and Tabulation).

   1. (1) Bid deposits. When a bid deposit is required, the deposit must be in the amount specified in the bid invitation. Only the following will be considered as meeting the bid deposit requirements: a cashier's check, a certified check, a money order, or cash in the amount specified in the bid invitation. Failure to include a bid deposit in the proper amount will automatically disqualify a bid.
   2. (2) Notice of award. The commission will notify the successful bidder or bidders, on a sealed bid sale of surplus or salvage property, that an award has been made to them and specify a period of time for payment. In the event that a successful bidder fails to make payment within the specified time, the commission may retain the bid deposit and consider it forfeited. Furthermore, the bidder forfeits his rights to the property and ownership of the property remains with the state.
   3. (3) Transfer of property and forfeiture. When a successful bidder has paid the full amount due for the purchase of surplus or salvage property obtained through a sealed bid sale, the commission shall notify both the successful bidder and the agency holding the title of the surplus or salvage and authorize the transfer of possession. In the case of vehicles or other items which require title transfer, it shall be the responsibility of the agency holding title to complete the transfer of title to the successful bidder. In the event a bidder pays for the property but fails to remove the property within the time specified, the bidder forfeits his rights to the property and ownership of the property reverts to the state.
3. (c) Disposition by live auctions. Surplus or salvage sold through the live auction method shall be accompanied by an auctioneer's paid receipt. The auctioneer's paid receipt will serve as the authorization of the commission that the purchaser has in good faith complied with the conditions of the sale. In the case of vehicles or other items carrying titles, the agency holding the original title shall be responsible for the transfer to the successful bidder. In the event that a successful bidder fails to make payment or remove the property within the specified time, the bidder forfeits his rights to the property and ownership of the property remains with the state.

4. (d) Disposition by direct sale to the public.

   1. (1) Generally. If the commission or a state agency which has been delegated authority under subsection (a)(2) of this section or under §126.2(6), determines that selling the property by competitive sealed bid or auction, would not maximize the resale value of property to the state, the commission or state agency may sell surplus or salvage property directly to the public.
   2. (2) Fixed price. The commission, in cooperation with the state agency that declared the property as salvage or surplus, or a state agency which has delegated authority under subsection (a)(2) of this section or under §126.2(6) of this title shall set a fixed price for the property.

   3. (3) Location and method of direct sales. Direct sales operations may be conducted at designated state facilities or warehouses approved by the Commission, or by Internet auction.

      1. (A) Access. The general public and assistance organizations will have equal access.
      2. (B) Payment. A purchaser under this section must pay for the property by an approved method at the time sale and prior to obtaining possession or actual title to the property.
      3. (C) Forfeiture. In the event a purchaser pays for property but fails to remove it with the time specified at sale, the purchaser forfeits any ownership rights and subsequently, ownership reverts to the state without recourse.
      4. (D) Internet auction. The commission may contract with one or more commercial Internet auction sites for sale of state surplus or salvage property. Property on the Internet auction site shall be posted for at least ten (10) calendar days.
5. (e) Disposition of property with no resale value (salvage). If the commission or a state agency with delegated authority under subsection (a)(2) of this section or under §126.2(6) of this title (relating to General Terms and Conditions) does not dispose of property under another method in this subchapter, and has advertised the property for sale and received no bids, or has determined that the property has no resale value, the agency may delete the property on the State Property Accounting System and dispose of the property in a manner that best serves the interests of the state in accordance with Government Code, §2175.193.
6. (f) Purchaser's title. A purchaser of surplus or salvage property at a sale conducted under this section obtains good title to the property if the purchaser in good faith has complied with all the terms and conditions of the sale.

7. (g) Reporting of sale.

   1. (1) On a sale by the commission of any property under this section, the commission shall report the property sold and the sales price to the agency that declared the property surplus or salvage.
   2. (2) The commission or a state agency with delegated authority under this subchapter shall report the sale and the amount of the sale proceeds to the comptroller. The comptroller by law shall remove the property from the State Property Accounting System.

Source Note:The provisions of this §126.4 adopted to be effective May 8, 2002, 27 TexReg 3756.