Reimbursement Manual for Pass Through Grants
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Transcript Reimbursement Manual for Pass Through Grants
1
REIMBURSEMENT MANUAL
FOR PASS THROUGH
GRANTS
DNR Office of Management and Budget Services
Topics to be Covered
2
Introduction
System Requirements (Q & A)
Project Reimbursement (Q & A)
Forms
Documentation
Work Plans/Reports
Documentation Kept on File (Q & A)
Land Acquisition Reporting Requirements (Q & A)
Materials and Services (Q & A)
Accounting, Documentation, and Record Reconciliation (Q & A)
Thoughts from an Auditor (Q & A)
Contact Information
Introduction
3
The DNR Grants Unit provides contract management
services related to all pass-through grant projects. Contract
management ensures oversight of reimbursement for project
deliverables and meets the requirements of all state laws and
policies including the Department of Administration’s Grants
Management procedures.
The reimbursement manual was developed to help grantees
administer the Pass-Through Appropriation and to provide
instructions on how to obtain reimbursements for eligible
project expenses.
Introduction (continued...)
4
The manual is based on federal and state laws, and policies
and procedures of the Office of Grants Management (OGM)
and the Minnesota Department of Natural Resources’ Office
of Management and Budget Services. The Reimbursement
Manual can be found on our website at:
DNR Pass-Through Grants Website
For questions regarding the grant agreement, including
reimbursement requests, please contact the State’s
Authorized Representative or your assigned Grants
Specialist.
System Requirements
5
Electronic Funds Transfer
SWIFT e-Supplier Portal
Electronic Funds Transfer
6
The preferred and most efficient method of payment is an
electronic funds transfer (EFT) directly into the grantee’s
designated bank account. Once a payment is made to the
grantee, it generally takes 2-3 business days for the funds to
appear in the grantee’s account.
To set up the EFT payment process, contact the
Minnesota Management and Budget (MMB) EFT Hotline at
651-201-8106
SWIFT Supplier Portal
7
Every company and organization doing business with the
state is considered a vendor.
In order to receive or view payments or invoices, every vendor,
whether current, new or prospective, will need to register
online with MMB
To use the Supplier portal, every vendor needs a vendor ID
number
To register, go to the Supplier portal and click on “Vendor
Registration Link”
SWIFT Website
SWIFT e-Supplier Portal
8
Vendor Resources are available at
SWIFT Vendor Resources Website
MMB helpline (651) 201-8106 or
EFT Helpline Email Address
SWIFT e-Supplier Portal Q & A
9
Questions
10
Project Reimbursement
Project Reimbursement Definition
Reimbursement Request
Reimbursement Documentation
Project Reimbursement #1
11
Reimbursements are made by the State upon receiving:
1)
Demonstration that deliverables in the approved Work
Plan have been achieved
2)
Documentation of eligible expenses
3)
Proof of payment (when applicable)
Note:
Any expenditure submitted for reimbursement must be direct and
necessary for the project and have been incurred during the
grant period.
Project Reimbursement #2
12
Grantee pays for expenses prior to seeking
reimbursement
Advance payment with prior (board) approval only
Total $ reimbursed cannot exceed the total award $
Grantees should expect payment within 30 days of
the DNR receiving a reimbursement request as long
as all the proper documentation has been submitted.
Reimbursement Request
13
The Reimbursement request is comprised of four sections:
Section 1: Project Reimbursement Payment Request Form
Section 2: Reimbursement Spreadsheets
Section 3: Project Activity Summary Spreadsheet
Section 4: Reimbursement Documentation
These documents are provided with the Reimbursement
Manual
Reimbursement Payment Request Form
14
Section 1: Project Reimbursement Payment Request Form
Section 1:
Required for all payment
requests including acquisition.
The form must be signed by
someone who is authorized to
submit reimbursement
payment requests on behalf of
your organization.
SWIFT PO Number:
Grantee:
Request Number
I certify that I am authorized to request funds, and that all services
rendered, materials purchased, and expenditures reported are as
shown in the attached reimbursement forms. I certify that the
expenditures reported have been incurred, are not being reimbursed
from another source, and were used exclusively for this project. All
original documentation is retained by the grantee in the form of
invoices, proof of payment, and signed time records. Copies of
these supporting documents are attached as required by State grant
management policies.
_________________
Period for which funds
are being requested:
From:
Project Name:
_____/_____/_____
To:
Signature
Date
_____/____/______
Amount of Request
$ _______________
Final Request:
Y / N
_____________________________________________________
Name, Title
Daytime Phone Number: ________________________________
E-Mail: ______________________________________________
Remarks:
For DNR Use Only
Note:
The period for which funds are
being requested can be the
earliest and latest dates that
costs were incurred or the time
period this request covers.
I have reviewed the evidence provided by the grantee for the goods, materials and/or services presented
and they satisfy State requirements for reimbursement under the pass through agreement.
Reimbursement approved for: $ ______________
By:
Date Received
____________________________________
Title: ________________________________
Date: _______________
2nd Review
By:
___________________________________
Title: ________________________________
Date: _______________
Please keep originals of invoices and evidence of payment as documentation for payments,
along with a copy of this completed form. Records must be retained for six (6) years from the
end of the agreement.
Reimbursement Spreadsheet
15
Section 2:
Provides a snapshot of the grant status including the starting budget,
current requested reimbursement amount, and the remaining
balance
Note: The starting budget reflected in the latest revision of the
approved Work Plan. Only approved budget items are eligible for
reimbursement.
Project Activity Summary Spreadsheet
16
Section 3:
Provides a detailed
summary of all
reimbursement request
items. This document
aids both the grantee and
state in tying all
requested expenses to
the project’s goals/work
plan with each
reimbursement request.
Note:
Expenses should relate to
the Activities and/or
Outcomes in the Work Plan.
Section 3: Project Activity Summary Spreadsheet
Transaction
Date
4/1/13
4/1/13
4/5/13
4/5/13
Description- ie. vendor,
contractor, restoration site
location, etc.
Johnson Nursery - Seeds for
Lafayette Park
Johnson Nursery - Mulch for
Spring Park
Restoration Inc. - Herbicide
application, Lafayette Park
Restoration Inc - Burn for
Spring Park
Category
Requested
Amount
Supplies
4,265.31
Supplies
2,039.07
Contract
3,600.00
Contract
7,430.00
Total
Personnel
Contracts
Supplies
Travel
17,334.38
0.00
11,030.00
6,304.38
0.00
Total Request #9
17,334.38
Reimbursement Request Examples
17
1. Reimbursement Payment Request Form
2. ENRTF Spreadsheet #1
3. ENRTF Spreadsheet #2
4. OHF Spreadsheet #1
5. OHF Spreadsheet #2
6. Project Activity Summary Spreadsheet
Reimbursement Spreadsheet-Final
18
Common Mistakes
The spreadsheet $ fields are not formatted to include cents (e.g.
$1,029 vs. $1,029.13) This throws off the totals.
The beginning balance is not the ending balance from the previous
reimbursement request.
Budget amounts do not match latest approved Work Plan
Overspending in budget item-LSOHC has 10% budget modification
language that needs to be approved into the work plan, LCCMR allows
overspending in subcategories, but not the total line item amount
Reimbursement Documentation-Expenses #1
19
Project expenses for reimbursement must be
documented with:
1)
2)
3)
4)
Receipts
Invoices
Time (payroll) records
Proof of purchase or payment
This information is required to determine the eligibility of the
expenses and to ensure expenses were made within the
project period.
Reimbursement Documentation-Expenses #2
20
The following information must be added to (or written on)
the copies of receipts, invoices, time records or other
documentation:
1)
Activity # the expense is being posted to (Environment and
Natural Resource Trust Fund only)
2)
Budget item such as personnel, equipment, travel, etc.
3)
If the documentation has expenses for more than one
activity and/or budget item, mark which elements of the
documentation are posted to each activity and budget item
Reimbursement Documentation-Expenses #3
21
4)
If the documentation has non-project expenses on it, be
sure to circle the expenses being posted to the project
along with the activity and budget item
5)
Check number or payment number used to pay for
receipt, invoice, or payroll. Number should match with
bank statement or other proof of payment
6)
All invoices must explicitly state the date(s) that the
services were performed and that date must fall within
the project period in order to be eligible for
reimbursement.
Reports and Work Plans
22
Progress Reports are due to the LCCMR and
LSOHC boards on a semi-annual basis. Due
dates are specific in each Accomplishment/Work
Plan.
The State may withhold payments for projects
with past due Work Plans or Progress Reports.
The final reimbursement request payments will
be paid when the Final Report has been
submitted and approved.
Budgets and Work Plans #1
23
Personnel- the percent of a full-time employee’s
time dedicated to the entire project must not
exceed what was approved in the work plan
If that percentage is not enough, contact the
appropriate board for a budget amendment.
All staff working on the project must report the
actual time worked on a project, regardless if that
amount exceeds the percentage the project was
approved for.
Budgets and Work Plans #2
24
Personnel- benefits, paid time off, vacation, and
sick time will be reimbursed on a proportional
level
For example, if you dedicated 80% of your fulltime status to the project, the DNR can reimburse
80% of your benefits.
Reimbursement Documentation
(Proof of Payment)
25
Proof of payment documentation is required to ensure
that funds are being provided on a reimbursement
basis
Examples of payment documentation include:
1) Electronic bank statement
2)
Copy of canceled checks
3)
A copy of bank statement with photocopies of
cleared checks
4)
Certified financial records
Proof of Payment Examples
26
1)
2)
3)
4)
Cancelled Checks
Receipts
Invoice Cross Reference
Expense Summary
Reimbursement Documentation - Overview
27
Send one copy of the Reimbursement
Request by mail or email to your assigned
DNR Grant Specialist…
1.
Reimbursement Payment Request Form
2.
Spreadsheet
3.
Project Activity Summary Spreadsheet
…along with the supporting documentation
(receipts, invoices etc.)
Project Reimbursement-Final
28
Questions
29
Documentation Kept on File
Grant Monitoring
30
The Office of Grants Management (OGM) requires the Grants
Unit to conduct grant monitoring on all pass-through grants
projects.
OGM Policy #08-10 requires one site visit during the course of
the grant period on projects valued at over $50,000. All projects
valued at over $250,000 require annual monitoring visits.
The state may conduct a proof of payment review for all
reimbursement requests submitted during the grant period.
No additional reimbursement requests will be processed until the
proof of payment for the request being reviewed is submitted
and approved.
Proof of Payment
31
The State requires proof of payment documentation to
ensure that funds are being provided on a reimbursement
basis.
It is the grantee’s responsibility to maintain proof of
payment documentation and make it available when
requested by the State.
The State will monitor proof of payment compliance
through grant monitoring.
Vendors and Subcontractors
32
Subcontractors include other organizations and/or businesses
that perform services identified in the work
program/accomplishment plan
Vendors provide supplies or materials to the project
Both must be selected based on contracting/purchasing procedures
outlined in the current reimbursement manual
Grantees may submit a copy of their contracting policies for review
and approval to the State as an alternative or follow the DNR’s
contracting policies/procedures
Transparency, fiscal control and accountability are key reasons why
the State requires grantees to be thorough in the solicitation and
selection of subcontractors and vendors
Solicitation and Selection #1
33
The following guidelines should be used:
1)
2)
3)
4)
5)
Grantees shall retain copies of executed subcontracts and bid
tabulation on file along with written documentation that describes
the rationale for selection of the subcontractor
Services/Subcontracts less than $2,500 require two or more verbal
quotes
Services/Subcontracts more than $2,500 but less than $10,000
require two or more written quotes
If the subcontract exceeds $10,000, it must be awarded through a
process of competitive bidding unless the subcontractor is listed in
session law such as Conservation Corps Minnesota
Grantees must use a Request for Proposal/Request For Quote
process to competitively select professional and technical services
Solicitation and Selection #2
34
6)
The advertisement for bid processes must allow
for fair competition among potential qualified
bidders.
7)
Grantee must verify the vendor/subcontractor is
not on the State’s debarment list: Debarment List
Website
Solicitation and Selection #3
35
8)
Single/sole source contracts: It is the policy of the
State of Minnesota (Policy 08-07: Single and Sole
Source Grants) that grants are to be competitively
awarded as much as possible.
Single and sole source grants are to be used when only one
entity is reasonably able to meet a grant’s intended purpose and
objectives, due to their geographic location, specialized
knowledge, relationships or specialized equipment.
The following template may be modified to reflect appropriate
organization information/titles: Grant Single Source Justification
Form.
The Grantee should send in the original to the State’s
authorized representative for signature and approval. If
approved, the Grantee must keep the executed copy on file.
Documentation Kept on File Q & A
36
Questions
37
Land Acquisition Reporting Requirements
Land Acquisition Requirements #1
38
Most grantees that are working with land and
easement purchases are using the guidelines of
Attachment E which are the guidelines
established as part of the executed grant
agreement
The latest version (July 2013) of Attachment E
had some changes that primarily centered on
items of clarity, consistency and expanding
eligible costs.
Land Acquisition Requirements #2
39
Legislative changes made last spring that
affected both OHF and ENRTF acquisition
requirements were also incorporated into the
latest version of Attachment E.
If an acquisition requires preliminary work
performed by the DNR such as an appraisal
review, it is important that a Use of Funds Letter
is submitted well in advance and that funding is
available in the DNR Professional Services line
item of the approved work/accomplishment plan
Land Acquisition Requirements #3
40
All documentation that is required per Attachment
E must be submitted at least 10 days prior to
close to ensure the documents can be reviewed
and the payment can be delivered
Grantees have the option of having funds wired
directly to their title company
Land Acquisition Reporting Requirements Q & A
41
Questions
42
Materials and Services
Materials and Services #1
43
Materials and services purchased by the grantee to achieve
outcomes/activities stated in the work plan are eligible project
expenditures
1)
2)
Typical examples of material/service purchases include
hardware, paint, lumber, sand/gravel, concrete, landscape
materials, signs, design/engineering services and
subcontractor services.
Professional service rates require written documentation
to justify the reason for the rate, how it was calculated,
and the services included in the rate.
Materials and Services #2
44
3)
An invoice must be obtained from the vendor to provide
evidence of the sale/service, whenever the grantee
purchases materials or services.
4)
The invoice and the copy sent in with the reimbursement
request must be legible and include the following items:
Name
and address of the vendor
Date the item or service was purchased
Date the service was performed
Quantity of item(s) purchased or hours worked
Description of item(s) or services purchased
Unit price/Prorate
Total amount of each line item
Materials and Services Q & A
45
Questions
Record Keeping - Accounting, Documentation
and Record Reconciliation #1
46
The grantee is responsible for maintaining fiscal controls and
fund accounting procedures that are based on generally
accepted accounting standards and principles. Grantees
must:
1)
Retain original supporting documents for each project including
all expenditures, receipts, and signed employee time records
2)
Itemize all supporting records of project expenditures in
sufficient detail to show the exact nature of each expenditure
Please be sure that invoices and receipts contain the name or type
of the item or service that was purchased in sufficient detail, so
project eligibility can easily be determined
Record Keeping - Accounting, Documentation
and Record Reconciliation #2
47
3)
4)
Cross-reference the expenditure with the
supporting invoice, purchase order, contract
voucher, etc.
Maintain certified payroll vouchers for salaries
and wages if employee staff time is being
charged to the project
All employees working on a project may fill out daily time
and effort sheets.
Timesheet elements include the period worked, time spent
on the project (time coding), employee’s name, rate of
pay, hours worked, benefit rate, and documentation that
the payroll has been paid.
Record Keeping - Accounting, Documentation
and Record Reconciliation #3
48
The
original time records must be available
for review and copies are to be submitted with
each reimbursement request.
All
vacation (paid time off), sick, and holiday
benefits are eligible for reimbursement on a
proportional level.
Record Keeping - Accounting, Documentation
and Record Reconciliation #4
49
5)
Records for grantee-owned equipment used
on a project must include the time actually
used for the project and the computation
used to arrive at the charged use rate.
Use
6)
rates are subject to review by DNR
When a project expenditure payment is by
check, the check must be properly identified
with the project item and invoice number
written on the check, submitted along with
proof of payment.
Record Keeping - Accounting,
Documentation and Record Reconciliation #5
50
7)
Project records are required for audit
purposes and must be readily available for
review.
Note:
All records related to the project must be retained
for a minimum of six (6) years following the project
completion and final payment.
51
Thoughts from an Auditor
Grant Management: Auditor’s Insight #1
52
Quick Intro
Mark Allan
Current: Internal Control/Accountability Unit Coordinator
Provide DNR consulting and assurance services .
Past: Auditor & Investigator for the Office of the Legislative Auditor
Had the opportunity to audit a variety of grant programs at several state agencies.
Focused on agencies’ grant management processes and controls.
Performed special reviews of grant recipients
Requested to do work by state employees, legislators, or citizens, based on
allegations/complaints/concerns of fraud, waste, or abuse.
Grant Management: Auditor’s Insight #2
53
Legislative (Pass-thru) Grants
These grants present a unique challenge for agencies.
Typically, programs are governed by another entity.
Executive branch agencies tasked with administrative functions.
Programs, as you know, can be complex and intricate.
At times, there can be a blurring of what the governing entity and agency
duties/responsibilities are.
Legislative Auditor, Jim Nobles, has stated that the agency receiving the
appropriation is ultimately responsible for controls.
DNR is a high-profile agency with a lot of public relations risk.
If there are any issues, it will be DNR in the press regardless of where the cause originated.
Grant Management: Auditor’s Insight #3
54
Why all the paper work and procedures?!? It takes me away
from doing important stuff!
They are a result of internal controls!
Internal controls are processes and activities that help to provide reasonable assurance that
objectives are met.
In a nutshell, internal controls promote good things, and prevent or detect bad things.
As good stewards of tax payer dollars, DNR is tasked with ensuring that funds are
spent in accordance with legislative intent.
As good stewards, we also have a responsibility to all stakeholders to demonstrate
that the bullet point above has happened - this is called transparency.
This generally boils down to processes, activities, and documentation.
To an auditor, if it isn’t documented, it never happened.
Grant Management: Auditor’s Insight #4
55
Conflict of Interest
State Grant Policy: “A conflict of interest, actual or perceived, occurs when a person has actual
or apparent duty or loyalty to more than one organization and the competing duties or loyalties
may result in actions which are adverse to one or both parties. A conflict of interest exists even
if no unethical, improper or illegal act results from it.”
Why such a high bar? If nothing bad happened, why do we need to worry about it?
Transparency!
For legislatively named grantees, why is this an issue? They’re not competitive, grantees are
picked!
Subcontractor and vendor selection
How do grant recipients demonstrate they’ve addressed this risk? What would an auditor look
for?
A conflict of interest or ethics policy. But more importantly, documentation of some sort of
periodic disclosure process.
An annual process is suggested at a minimum - wise to revisit if business environment
changes.
Grant Management: Auditor’s Insight #5
56
Conflict of Interest
Policies are an important framework; however they are just pieces of paper if there are no
corresponding actions - such as a disclosure process.
So, who should do it?
Anybody with decision making duties
It is important to remember that it doesn’t have to be an actual conflict. The state policy
purposefully addresses conflicts that are “actual or perceived”.
In the spirit of transparency, during the disclosure process document those relationships that
may be benign from your perspective.
Take the approach of “what would this relationship look like if I were an independent observer
outside of my organization”.
Grant Management: Auditor’s Insight #6
57
Conflict of Interest – Examples
Each situation is often unique, with lots of shades of grey. But, here are a few scenarios:
#1 - You used to work at a transportation company. You left there a year ago to work at your
current organization. You have no personal or professional ties with the old employer. Your
program will most likely need a transportation company to provide services and it is reasonably
expected that your old company will bid for the subcontract.
Resolution: This is most likely only a perceived conflict of interest. But, if you think like an independent
observer outside of your organization, you realize that there is no way of knowing whether or not you still
have ties. Best course of action is to discuss this relationship with your organization’s leadership. After
details are discussed, document this relationship (disclosure) and the fact that you brought it to another
person for review. That’s it. You’re done.
#2 – You are a decision maker for your organization. Your program will need an excavation
company to do work. Your spouse owns an excavation company and is reasonably expected
that the company will respond to the RFP.
Resolution: This appears to be an actual conflict of interest. Best course of action is discuss this with your
organization’s leadership. Document this relationship (disclosure) and the fact that you discussed it with
another person. In this case you would remove yourself from the RFP ranking and selection process.
Grant Management: Auditor’s Insight #7
58
Subcontracting/Vendors: If I showed up, what would I want to
see?
Documentation!
Between $2,500 and $10,000: two or more written quotes on file.
> $10,000: bid tabulation and/or other rationale for selection on file.
Current conflict of interest disclosures.
We would establish who the decision makers were and determine if their was risk of
impairment.
Sole Source
State’s Authorized Representative approval on file.
We would review the rationale for reasonableness, and ensure authorized
representative’s decision was prudent.
Knowing that your work is often times performed by a close-knit network in a relatively small
professional community, documenting even the appearance of conflicts of interest is critical.
Appearance of conflicts of interest is not necessarily a bad thing - they just need to be
documented to ensure transparency.
Grant Management: Auditor’s Insight #8
59
Reimbursements: If I showed up, what would I want to see?
Pass-thru grants are structured to reimburse for expenditures previously made, for eligible
costs incurred in the timeframe stipulated by the grant agreement.
Eligibility of cost:
Determine if it represents activity that ties out to a workplan budgetary item.
Determine if the specific costs were “direct and necessary”.
For payroll, we would look for timesheets or other payroll related documentation to ensure
time accurately tied to project outcomes.
Period of availability:
Determine if the costs were incurred during timeframe stipulated in agreement.
Determination that costs were previously incurred before reimbursement request:
Proof of payment
Cancelled checks, bank statement, etc.
Grant Management: Auditor’s Insight #9
60
Monitoring
Grants unit will monitor activity in a variety of ways:
Remotely by performing desk review.
On site visits.
Either method requires the same documentation.
As you compile your reimbursement requests, assume that they will be selected for review.
This will be a time saver in the event that grants staff, internal audit, or the OLA wants to
review the grant files.
DNR Internal Audit will monitor the grants unit’s monitoring (hows that for a brain twister!)
OLA most likely will not rely on any of DNR’s monitoring activity to gain assurances that controls
are in place
However, they will review using the criteria and approach mentioned in the previous slides
In Conclusion - Points to Remember #1
61
Reimbursement Requests should be submitted every
three (3) months.
Spreadsheet - Beginning balances must equal ending
balances from previous Reimbursement Payment
Request.
Budget – Must match amounts in latest, approved
Work/Accomplishment Plan.
Expenses – Submitted for reimbursement must be
eligible expenses in latest, approved
Work/Accomplishment Plan.
In Conclusion - Points to Remember #2
62
Project expenses for reimbursement must be
documented with:
1)
2)
3)
4)
Receipts
Invoices
Time (payroll) records
Proof of purchase or payment
The Date Range on the Reimbursement Payment
Request Form represents the first and last date of costs
incurred.
All costs must be incurred prior to the grant end date.
In Conclusion - Points to Remember #3
63
The final reimbursement payment request will be paid
when the Final Report has been submitted and approved
by either board.
For questions regarding the eligibility of certain
expenses, please contact your Grant Specialist.
Contacts
64
Amanda Graeber - Grants Manager
651-259-5533
[email protected]
*
Patrick Donnell - Grants Specialist Sr.
651-259-5543
[email protected]
*
Jason Tidemann - Grants Specialist Sr.
651-259-5534
[email protected]
Documentation Reconciliation Q & A
65
Questions