B31.3 dies not use Sy for allowable stress because it is a fatigue based Code. See paragraph 302.3.2 for a discussion of how the allowable stresses are calculated.

You simply change the material input to each element when your material changes. You could build a CAESAR II model where each element was made of a different material and the software would not have a problem with this issue.

It appears that you have a lot of catching up to do. I recommend you read the B31.3 Code thoroughly and work through several of the sample problems included with your copy of CAESAR II before doing anything of consequence.