Enterprise Asset Management CUB meeting November 14, 2012

1. Enterprise Asset Management CUB meeting November 14, 2012 DAS Surplus Property Programfacilitates 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 State Agencies Local Governments (IGAs)

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

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

5. Proposal ‘A’ for 2013 - 2015 State Agencies Local Governments (IGAs)

6. Projected results of Proposal ‘A’ • Program costs covered

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

8. Proposal ‘B’ for 2013 - 2015 State Agencies Local Governments (IGAs)

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)

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

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

12. ORS 279A.265 (2) • “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.”