UNIVERSITY OF VIRGINIA
           FINANCIAL AND ADMINISTRATIVE POLICIES MANUAL



TITLE:  MANAGEMENT OF GAS CYLINDERS               POLICY:  VII.A.13x

                                                                   
                                                                   
The University contracts with a single vendor for the procurement
of compressed gas mixtures in cylinders.  Along with the contract,
Purchasing implemented a Gas Cylinder Management System to track 
all compressed gas cylinders from receipt from the vendor to 
their eventual return.  Such a system is needed for two reasons.

     To ensure the locations of all gas cylinders are known, and

     To calculate demurrage charges and bill using departments.

Demurrage is the periodic rental charge the vendor imposes on the
University for the use of its gas cylinders.  The Gas Cylinder
Management System will tell Purchasing which departments have 
which cylinders, and the demurrage charge to be paid by those
departments.  The automated system will calculate daily demurrage
costs and automatically charge the departmental
account each month.  The departmental monthly gas cylinder report
(sent to using departments) shows the number of days a department
has had a cylinder in its possession and the departmental share of
the costs.

Separate from the monthly demurrage charges, the department will
make a one-time payment for cylinder contents, i.e., to Stores for
"stock" cylinders or to the vendor for "non-stock" cylinders.

See also Procedure 7-16, "Ordering and Returning Gas Cylinders."

See also Procedure 7-17, "Preparation of Gas Cylinder Return
Report."


ISSUED BY:                                                 03/16/87

Chief Contracting 
Officer                         7.1.13