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University Provided Vehicles

Revised: July 1, 2010

Also refer to Signature Authority Policy

Table of Contents

University Provided Vehicle Policy
University Provided Vehicle Defined
University Provided Vehicle Types
IRS Regulations
University Responsibilities
Employee Responsibilities
Payroll Department Responsibilities
Business Miles Defined
Personal Use Defined
Commuting Miles Defined
Obtaining a University Provided Vehicle Procedure
Annual Certification Procedure
What To Do When Drive Leaves the University
What To Do If Driver Changes Vehicles
What To Do at the End of the Lease
Related Policies
Additional Information


University provided vehicle policy

All vehicle acquisitions (leased, purchased or provided as a courtesy to Pacific) are subject to the University's Signature Authority Policy. See University Vehicles, Leasing and Purchasing Signature Authority.

Written approval by the President's Office is required to obtain a University provided vehicle unless the vehicle is a courtesy vehicle. The University complies with all IRS regulations for University provided vehicles.

Note: This policy does not apply to vehicles used solely for University business (i.e., not driven home or used for personal purposes).

University provided vehicle defined

A vehicle used for both business and personal purposes.

University provided vehicle types

University provided vehicle types include:

  • Vehicles leased by the University.
  • Vehicles purchased by the University.
  • Courtesy vehicles provided by friends of the University.

IRS regulations

The IRS considers personal use of a University provided vehicle to be a fringe benefit subject to taxation (IRC §61-21(b)(4)(i)). Business use must be substantiated by acceptable evidence (i.e., mileage logs attesting to business and personal use of University vehicles). The value of the personal use is added to the employee's compensation as a non-cash fringe benefit to be reported on Form W-2. These regulations apply whether the vehicle is leased or owned by the University or the vehicle is a courtesy vehicle.

University responsibilities

The University pays the following expenses for University vehicles:

  • lease payment,
  • insurance (handled through Risk Management),
  • tags (handled through Risk Management),
  • maintenance (including washing) and
  • fuel.

Note: Employees must submit maintenance invoices on an Authorization for Payment form or Procard. Invoicing directly by the vendor does not provide sufficient information for identifying the appropriate department to charge.
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Employee responsibilities

Employees must:

  • Notify both Payroll and Risk Management immediately of any changes (i.e., new vehicle, etc.)
  • Maintain the vehicle (contact Risk Management for policy).
  • Report any accidents to Risk Management immediately.
  • Maintain a detailed mileage log which lists business miles driven each year.
  • Annually certify the total miles driven each year and the amount of business miles driven.

Note: The detailed mileage log is not submitted to the University but must be retained by the employee in the event of an IRS audit.

Payroll Department responsibilities

The Payroll Department annually calculates a personal benefit based upon the information submitted on the Annual Certification of Business Use form. The amount of this personal benefit is reported as a non-cash fringe benefit on Form W-2.

Business miles defined

Business miles are those miles driven for official University business.

Personal use defined

Personal use of an employer-provided vehicle is any use not in the trade or business of the employer. Commuting miles are de facto personal use.

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Commuting miles defined

Commuting miles are those miles driven between your home and the campus where you regularly work.

Obtaining a University provided vehicle procedure

Follow the procedure below to obtain a University provided vehicle:

Step Action
1 Obtain written approval from the President's Office.



2 If vehicle is... Then...

Purchased Submit requisition to Purchasing Department and forward written approval to Purchasing Department.

Leased Submit requisition to Purchasing Department and forward written approval to Purchasing Department.


Note: Purchasing Department signs all lease contracts on behalf of University.

Courtesy vehicle Notify Payroll Department and Risk Management. Proceed to Step 4.



3 Vehicle is obtained and Purchasing Department notifies Payroll Department and Risk Management.



4 Employee maintains vehicle in accordance with Risk Management policies and maintains mileage log of business and personal usage for Annual Certification Procedure.

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Annual certification procedure

Follow the procedure below annually to certify business use:

Step Action
1 Maintain mileage log tracking business miles and total miles driven each calendar year (January - December).

 
2 Complete Annual Certification of Business Use form, available from Stockton Payroll Department.

 
3 Submit completed form to Stockton Payroll Department by due date.

What to do when driver leaves the University

When the driver leaves the University notify the following department(s):

If vehicle is... Then...
Leased Purchasing Department.

Note: Purchasing Department notifies Risk Management, Payroll and Financial Reporting Departments.


Purchased Purchasing Department.

Note: Purchasing Department notifies Risk Management, Payroll and Financial Reporting Departments.


Courtesy (i.e., provided to University by a vendor, etc.) Payroll Department and Risk Management.

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What to do if the driver changes vehicles

When the driver changes vehicles, the following departments must be contacted:

If vehicle is... Then...
Leased Purchasing Department.

Note: Purchasing Department notifies Risk Management, Payroll and Financial Reporting Departments.


Purchased Purchasing Department.

Note: Purchasing Department notifies Risk Management, Payroll and Financial Reporting Departments.


Courtesy (i.e., provided to University by a vendor, etc.) Payroll Department and Risk Management.

What to do at the end of the lease

Driver contacts the Purchasing Department at least one month prior to the end of the lease for assistance with end of lease close-out. The Purchasing Department will then notify Risk Management, Payroll and Financial Reporting Departments.

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Related policies

Procurement Policy, Surplus Property Disposition Policy.

Additional information

Contact the following departments for additional information:

Department Purpose
Purchasing Department Obtaining/disposing of vehicle.


Risk Management Obtaining insurance and licensing; maintenance policies.


Payroll Department Taxation issues.

Note: The Payroll Department does not provide tax advice. Consult your tax preparer for income tax advice.