A brand-new $89,000 shredder and compacter bought by the Internal Revenue Service is busy compacting aluminum cans in Islip, N.Y.

Reagan High School in Austin, Tex., now has 25 slightly used gold-braided uniforms, hand-me-downs from Richard M. Nixon's White House police force.

Islip and Austin are beneficiaries of a program that tries to find a home for property federal agencies have decided they don't want. Last year, property originally worth $340 million, everything from helicopters to peanut butter to puppies, was donated through the program, run by the the General Services Administration's Federal Property Resources Service.

Under the 1949 Federal Property Act, government agencies are required to turn over excess property to the GSA, which tries to find another federal agency that can use it. If that fails, the item is declared surplus, and state surplus property agencies are notified.

The state offices then try to match available items with "wish lists" submitted by local public agencies, such as non-profit educational and public health organizations, public parks, programs for the elderly, Indian reservations and airports. Recipients must pay shipping and handling costs.

The uniforms were worn briefly by Nixon's White House police force, which was immediately renamed the "imperial police" or the "palace guard" by some writers. The uniforms were stored for several years and then turned over to the GSA in 1978. The Texas surplus agency put the Austin high school and the GSA together.

The school's $2,819 worth of White House uniforms arrived "kind of butchered," according to a spokesman for the Texas agency. Buttons and insignia were missing, and the school didn't get enough of them to outfit the entire band. But the high school's sewing classes added buttons and school emblems, and the school got the rest of the uniforms it needed elsewhere.

Another $12,500 worth of the uniforms were divided between Southern Utah State College and a community school in Cleghorn, Iowa. Another 11 ended up in military museums.

In another case, the IRS bought 11 Document Destruction Systems, otherwise known as shredders, to make confetti of confidential reports. Ten shredders were installed in IRS regional centers. The 11th was to go in the courtyard of the IRS building in Washington.

But that building happens to be on the National Register of Historic Places. The District of Columbia's historic preservation officer told the IRS that the shredder "would introduce a visual element that is out of character with this important building and its setting."

The GSA's historic preservation office agreed, and ordered that the machine be turned over to the property service, which found a home for it in Islip. Town Supervisor Michael LoGrande said the compacter is being used for aluminum cans, and that the shredder will be used to manufacture newspaper briquettes for Islip fireplaces.

About 25 percent of federal surplus property is donated to public agencies, either because the agencies don't want what the government has to offer or because the shipping costs are too high. What the government can't give away it tries to sell.

Last year, it sold more than $1.2 billion worth of surplus property, according to a spokesman for the service's personal property donation division.

"Selling it is a last resort," he said. "The idea is that the property was purchased with taxpayers' money and should be returned to public agencies in the form of donations, if possible."