|January 6, 1998
|WIC Final Policy Memorandum 98- 3
|Non-Computer Equipment Purchases Less Than $25,000
Supplemental Food Programs
Federal awarding agencies may waive the requirement to obtain the awarding agency's prior approval of capital expenditures for equipment, other assets, and improvements which materially increase the value or useful life of equipment or other capital assets (7 CFR 3016.22). Therefore, this policy memorandum authorizes WIC state agencies to purchase or allow their local agencies to purchase non-computer equipment with a unit cost less than $25,000 without prior approval from FNS. The exception is that regional offices maintain the authority, with written notice, to continue to apply a lower cost threshold for a state agency and its local agencies, if the region determines that an equipment purchase having a unit cost of $5000 to $24,999 would represent a significant amount or percentage of that state agency's Nutrition Services and Administration (NSA) grant or if the state agency is high-risk for financial or program management deficiencies based on its current or historical performance.
The objective of this policy is to relieve WIC state agencies of the requirement to submit requests to FNS for prior approval of relatively small state and local level noncomputer equipment purchases which have traditionally been accepted to be reasonable and necessary to conduct WIC program operations such as copiers and vehicles. This policy memorandum is applicable only to non-computer equipment. Computer equipment purchases are governed by FNS Handbook 901 , Advanced Planning Document and require the state to either obtain written prior approval from FNS or notify FNS of the purchase according to the guidance provided there. Computer equipment purchases include hardware such as personal computers, monitors for individual work stations, printers, modems, keyboards, etc., whether used alone or as part of a distributed system or a centralized system. Therefore, all equipment purchases are governed either by this policy memorandum or FNS Handbook 901, Advanced Planning Document.
This policy simply raises the cost threshold for non-computer equipment purchases which require prior approval from FNS. Equipment costs determined, by audit or otherwise, not to meet other requirements or tests for allowability, provided in program regulations and policy and 0MB Circulars, such as reasonableness and necessity, may still be disallowed. Therefore, regardless of cost, if a state agency has any question concerning the allowability of an item of equipment, the FNS regional office should be contacted for assistance in making this determination. Further, equipment acquired with federal WIC grant funds must still be used, managed (property records maintained, inventories conducted, etc.) and disposed of in accordance with guidance provided in 7 CFR 3016.32. Finally, WIC state and local agencies must continue to follow state and local agency procurement policies and procedures. As such, WIC state agency procurements, which no longer require prior approval from FNS, may continue to require prior approval from state agency officials. WIC local agency procurements, which no longer require approval from FNS, may continue to require prior approval from local and/or state officials.
Purchases of other capital assets such as buildings, land and improvements to buildings or land that materially increase their value or useful life, costing more than $5000, continue to require prior approval from FNS. regional offices will use the guidance provided in FNS Instruction 813-1, dated May 5, 1993, to assess these requests.
Supplemental Food Programs Division
Grants Management Division