“Government-furnished property” (GFP) and “government-furnished equipment” (GFE) are terms most commonly associated with U.S. Department of Defense contracting under FAR Part 45 and DFARS 245 — property a contractor uses to perform a contract but never owns. Universities and other institutions performing federal research grants and cooperative agreements encounter a close analogue, governed instead by the Uniform Guidance at 2 CFR 200.312, “Federally owned and exempt property.” This guide covers that grants-context version: equipment or other tangible property a federal sponsor furnishes to (rather than purchases through) a university performing a sponsored award, and the custodial, reporting, and disposition obligations that come with holding it.
If your office primarily works federal contracts rather than grants or cooperative agreements, the FAR/DFARS GFP framework (with its own property attachments, GFEBS/iRAPT-style systems, and contracting-officer-property-administrator roles) is a different regulatory regime from what’s described below — don’t assume the two are interchangeable when a single research office handles both instrument types.
What Counts as Federally Owned Property Under 2 CFR 200.312
2 CFR 200.312 applies to property that the federal government itself owns and places in a recipient’s custody to carry out a federal award — for example, a specialized instrument a sponsoring agency ships to a university lab, or equipment transferred from a government facility for use on a specific project. This is distinct from two other categories research administrators handle constantly:
- Recipient-acquired equipment — equipment the university buys with award funds. Title generally vests in the recipient (subject to a federal interest), and it’s governed by 2 CFR 200.313 (“Equipment”), which sets the $10,000 disposition threshold and management standards discussed in our federal grant closeout guide.
- Exempt property — a narrow category that can only exist “when permitted by Federal statute and set forth in the terms and conditions of the Federal award.” Absent that explicit statutory permission and award-term language, property stays federally owned and the restrictions below apply.
Federally owned property under 200.312 is the true grants-world counterpart to “government-furnished property” — the government retains ownership throughout, and the recipient’s role is custodial, not proprietary.
Title Never Transfers to the Recipient
The regulation is direct on this point: title to federally owned property remains vested in the federal government for as long as the property exists, regardless of how long it sits in the recipient’s lab or how integral it becomes to the project. A university cannot capitalize it as an institutional asset, cannot use it as collateral, and cannot treat it as its own once the award ends — three practical mistakes that show up when GFP gets absorbed into general departmental equipment inventories without a flag distinguishing it from institution-owned assets.
Custodial and Recordkeeping Responsibilities
2 CFR 200.312 itself is short on prescriptive recordkeeping detail, which is precisely why institutions get this wrong: many assume that because 200.312 doesn’t spell out a records list, none applies. In practice, funding agencies routinely incorporate property-management standards by reference in award terms and conditions, and most research institutions apply the same disciplined standard used for recipient-acquired equipment under 2 CFR 200.313 to any GFP in their custody, since it is the closest codified benchmark and the one auditors expect to see. That standard requires property records containing, at minimum:
- A description of the property and a serial number or other unique identification number
- The source of funding for the property, including the Federal Award Identification Number (FAIN)
- The title holder (for GFP, always the federal government)
- The acquisition date and cost
- The percentage of federal participation in the cost (for GFP, effectively 100%)
- Location, current use, and condition
- Any disposition data once the property is transferred, replaced, or disposed of
On top of records, institutions holding equipment under either 200.312 or 200.313 need: a physical inventory reconciled against property records at least once every two years; a control system adequate to prevent loss, damage, or theft, with any loss investigated and reported to the funding agency if it affects the project; and regular maintenance procedures to keep the property in proper working condition. Always confirm the specific requirements attached to your award — the award’s terms and conditions, and the funding agency’s own property-management regulations, control over the general 200.312 baseline described above.
Annual Reporting: The SF-428 Form Family
Many federal awarding agencies require recipients holding federally owned property to report on it using the SF-428 Tangible Personal Property Report and its attachments, a standard federal-form suite used across agencies including NSF, DOE, and NOAA:
- SF-428 — the cover sheet
- SF-428-A (Annual Report) — the annual inventory listing 2 CFR 200.312 requires, typically reported as of September 30 unless the award specifies a different date
- SF-428-B (Final Report) — submitted at award closeout
- SF-428-C (Disposition Request/Report) — used to request disposition instructions or report a disposition action
- SF-428-S (Supplemental Sheet) — used to itemize detail on individual pieces of property when the main forms don’t have room
Not every agency uses the SF-428 suite by name for every award — check the specific notice of award and agency-specific grants terms — but it’s the form family to expect, and the one your central property office or sponsored programs office should already have a submission process built around if your institution regularly receives federally furnished equipment.
Requesting Disposition Instructions at Award End
Recipients must request disposition instructions from the federal agency or pass-through entity upon completion of the award or as soon as the property is no longer needed — whichever comes first. This is a recipient-initiated obligation, not something that happens automatically at closeout: institutions that wait for the agency to ask about equipment in their custody are already out of compliance. Once the federal agency determines it no longer needs the property, it must declare the property excess and report it to the appropriate federal disposal authority, unless the agency has separate statutory authority to dispose of it by another method. The recipient does not have independent authority to sell, transfer, or scrap federally owned property on its own initiative — that authority sits with the federal government throughout the property’s life.
GFP/Federally Owned Property vs. Recipient-Acquired Equipment, at a Glance
| Dimension | Federally owned property (2 CFR 200.312) | Recipient-acquired equipment (2 CFR 200.313) |
|---|---|---|
| Who holds title | Federal government, always | Recipient, subject to a federal interest tied to the percentage of federal funding |
| How it enters the institution | Furnished/transferred by the federal sponsor | Purchased by the recipient with award funds |
| Disposition authority | Recipient must request instructions from the agency; cannot dispose independently | Recipient may generally retain, sell, or dispose of items at or below the $10,000 fair-market-value threshold without further federal approval |
| Annual reporting | Typically required (SF-428-A or agency equivalent) | Not typically required annually; tracked internally, reported at disposition/closeout |
| Exempt-property pathway | Only if federal statute and award terms explicitly permit it | Not applicable — title already sits with the recipient |
Where Responsibility Typically Sits on Campus
Custodial responsibility for GFP is usually split across three roles: the principal investigator or departmental custodian, who has day-to-day physical control and is the front line for noticing loss, damage, or a change in use; the central property or asset management office, which maintains the institution-wide property records, runs the biennial physical inventory, and flags GFP as a distinct category from institution-owned and recipient-acquired federal equipment; and the sponsored programs or grants office, which handles the SF-428 reporting cycle, requests disposition instructions at the right trigger points, and coordinates with the agency at award closeout. Institutions that don’t explicitly tag GFP as a separate inventory category — distinguishing it from equipment purchased under 2 CFR 200.313 — are the ones most likely to lose track of a disposition obligation or miss an annual report, because the item looks, in a departmental inventory system, exactly like everything else the lab owns.
Common Compliance Pitfalls
- Treating GFP as institutional property. Capitalizing it on the university’s books, insuring it as an owned asset, or including it in an institutional surplus/salvage sale without agency disposition instructions.
- Missing the annual SF-428-A cycle. Especially common when the equipment sits with a single PI’s lab and no central office is tracking the reporting deadline.
- Conflating grants-context federally owned property with FAR/DFARS government-furnished property. Offices that manage both federal contracts and federal grants sometimes apply DoD-style GFP tracking systems or contract clauses to a grant award, or vice versa — the two frameworks share a concept but not a regulatory citation, a form set, or an administering office.
- Not flowing the obligation down to subrecipients. If a subrecipient holds federally owned property furnished for its portion of the work, the prime recipient’s subrecipient monitoring obligations extend to confirming the subrecipient is meeting the same custodial and reporting standards.
- Waiting for the agency to ask about disposition. The regulation places the burden on the recipient to request instructions, not on the agency to remember to ask.
Frequently Asked Questions
Is “government-furnished property” the same thing in a research grant as it is in a defense contract?
The underlying idea — property the government owns but a performing organization uses — is the same, but the regulatory frameworks differ. Defense and other federal contracts use FAR Part 45/DFARS 245 and their own GFP-specific processes and systems. Federal grants and cooperative agreements use 2 CFR 200.312, which has its own (lighter-weight) title, reporting, and disposition rules. A university office that handles both contract and grant awards should not assume one framework’s paperwork or systems satisfy the other’s requirements.
Who holds title to equipment a federal sponsor furnishes to a university?
The federal government does, for the entire life of the property. This is the core distinction from equipment the university purchases with award funds, where title (subject to a federal interest) generally vests in the recipient under 2 CFR 200.313.
Do universities have to report on federally furnished property every year?
2 CFR 200.312 requires an annual inventory listing to the federal agency or pass-through entity. Many agencies implement this through the SF-428-A Annual Report, typically reported as of September 30 unless the award specifies otherwise — check your specific award’s terms.
Can a university just dispose of government-furnished equipment when a project ends?
No. The recipient must request disposition instructions from the federal agency or pass-through entity at project completion or whenever the property is no longer needed, and wait for those instructions before disposing of it. The federal agency, not the recipient, controls disposition.
What is “exempt property” and does it change any of this?
Exempt property is a narrow category where, if a federal statute permits it and the award’s terms and conditions explicitly say so, some of the normal federally owned property restrictions can be relaxed. Absent that explicit statutory basis and award-term language, assume standard 200.312 rules apply in full.
