1. Enterprise Asset Management CUB meeting November 14, 2012 DAS Surplus Property Program facilitates the reuse of surplus property for state, local and federal government. We accomplish this by helping our customers dispose of excess assets and offer their surplus for reuse. Proceeds from sales cover operational costs; remaining funds go back to state and local government.

2. 2011 - 2013 Rate Structure Gross Sales PriceAdministrative Fee Personal Property Up to $100100% Above $100$100 + 50% of remaining sales price up to a maximum charge of $2,000 on any single item Vehicles and Titled Equipment Up to $250100% Above $250$250 + 25% of remaining sales price up to a maximum charge of $2,000 on any single item State Agencies Gross Sales PriceAdministrative Fee Personal Property Up to $10100% Above $10$10 + 20% of remaining sales price with no cap Vehicles and Titled Equipment Up to $260100% Above $260The greater of $260 or 7% of the final auction value Local Governments (IGAs) Slide 1

3. Pros and Cons of existing structure  Pros  Familiar rate structure which is hard coded into existing inventory management software  Cons  Does not cover costs – projected program revenue shortfall of $1,106,673 which can be reduced to a shortfall of $993,726 if the POP is removed  Lack of 60 day operating capital of $605,538K which includes restoring the projected negative cash balance of $157,435  Perception that agencies with a fleet are paying more than their fair share of Surplus Program operational costs  Significant number of financial transactions Slide 2

4. Budget Reduction Option Exercise  Reduce eBay expense - $150,000  Eliminate professional services contracts - $129,903  Reduce office expenses- $40,000  Reduce temporary appointments - $50,720  Reduce inbound shipping for Federal program- $17,421  Eliminate Administrative Specialist 1 position - $137,639  Eliminate Truck Driver position - $128,210  Total Reduction of 12.6% = $653,893 Slide 3

5. Proposal ‘A’ for 2013 - 2015 Apply method as described in ORS 279A.265 (2) {text included in final slide below} – Essentially: The Surplus Property Program would keep the proceeds from all sales, reimburse IGAs, subtract operating costs, and return any remaining funds to agencies based on their percentage of the gross sales. State Agencies Local Governments (IGAs) Slide 4 Gross Sales PriceAdministrative Fee Effective Rate Increase Number of Items Personal Property Up to $50100% 1,694 Above $50$50 + 50% of remaining sales price; no cap 92%1,523 Vehicles and Titled Equipment$250 + 7% of remaining sales price; no cap 35%446

6. Projected results of Proposal ‘A’  Program costs covered Slide 5

7. Pros and Cons of Proposal ‘A’  Pros  Ensures program costs are covered  Reduces workload for agencies served and for Program by dramatically reducing financial transactions  Equalizes reimbursements based on use of Program  Cons  Withholds reimbursable funds for a longer period of time than current reimbursement schedule Slide 6

8. Proposal ‘B’ for 2013 - 2015 State Agencies Local Governments (IGAs) Slide 7 Gross Sales PriceAdministrative Fee Effective Rate Increase Number of Items Personal Property Up to $500100% 25%15,530 Above $500 $500 + 50% of remaining sales price up to a maximum charge of $2,000 on a single item 60%379 Vehicles and Titled Equipment$250 + 25% of remaining sales price up to a maximum charge of $2,000 on any single item 0%1,539 Gross Sales PriceAdministrative Fee Effective Rate Increase Number of Items Personal Property Up to $50100% 1,694 Above $50$50 + 50% of remaining sales price; no cap 92%1,523 Vehicles and Titled Equipment$250 + 7% of remaining sales price; no cap 35%446

9. Projected results of Proposal ‘B’  Projected increased revenue from State Agencies of $283,830  Projected revenue increase from IGA business of $158,944  Projected remaining shortfall of $550,952 to be addressed by items in the Budget Reduction Option Exercise (slide #3) Total Impact: $993,726 (covers Program costs) Slide 8

10. Pros and Cons of Proposal ‘B’  Pros  Program costs covered by increased rates and program reductions  Increases percentage of program funding that comes from personal property vs. from vehicles  Redirect resources currently allocated to IGA customers and redistribute to outreach/marketing/customer service efforts  Cons  Slower customer response time due to loss of Administrative Specialist 1 position  Projected to lose 20% of IGA sales volume because they can get similar service at lower rates from private entities  Significant number of financial transactions Slide 9

11. Questions Sven Anderson Surplus Property Manager 503.378.6057 Sven.Anderson@state.or.us Slide 10

12. ORS 279A.265 (2) Slide 11  “The Director of the Oregon Department of Administrative Services may distribute in the form of cash dividends accumulated surpluses in the fund that arise because the charges collected from donees are in excess of the amount necessary to keep the activities under this section and ORS 279A.260 on a self-sustaining basis. The director shall pay the cash dividends to the donees referred to in ORS 279A.260 (1). Any dividend paid under this subsection shall be based on the ratio of the charges collected from each donee during the preceding fiscal year to the total charges collected from all donees for the fiscal year immediately preceding the fiscal year in which the dividend is authorized to be paid.”