Transcript Title I Fiscal Responsibilities Are You Fiscally Compliant? Presented by: New Jersey Department of Education Office of Student Achievement and Accountability.

Title I Fiscal Responsibilities
Are You Fiscally Compliant?
Presented by:
New Jersey Department of Education
Office of Student Achievement and Accountability
What is Needed to be in Compliance &
Where to Find It
 No Child Left Behind
www.ed.gov/legislation/ESEA02/index.html
 OMB Circular A-87, Attachment B
www.whitehouse.gov/omb/circulars/a087/a087_2004.pdf
 EDGAR
http://www.ed.gov/policy/fund/reg/edgarReg/edgar.html
 Compliance Supplement (A-133)
http://www.whitehouse.gov/omb/circulars_a133_compli
ance_08_08toc/
 General Education Provisions Act (GEPA):
straylight.law.cornell.edu/uscode/html/uscode20/usc_sup_01_20_1
0_31.html
Legal Structure and Requirements
Statutes
Program
Regulations
Program
Guidance
Letters/Press Releases
EDGAR (Parts 76 & 80)
OMB Circulars
OMB A-133
Compliance
Supplement
Office of Inspector General
System Requirements for LEAs
EDGAR §§ 80.20, 80.32, 80.36
 Financial Management=80.20
7 Key components
 Financial Reporting (Ability to Report)
 Accounting Records
 Internal Controls
 Budget Controls
 Allowable Costs
 Source Documentation
 Cash Management
System Requirements for LEAs
EDGAR §§ 80.20, 80.32, 80.36
 Equipment=80.32 (more details later)
 Procurement=80.36
Open competition
Cost/Price Analysis
Vendor Selection
Contract Administration
Board Minutes
What should be in my Board minutes?
Resolutions to:
 Apply for Funds (copy
of budget statement)
 Accept the Fund
(Grant Acceptance
Certificate)
Board Minutes (continued)
What should be in my Board minutes?
 Appointment of Teachers
 Name
 Salary
 School
 Funding Percentage for Each Program
 Appointment of Secretaries, Aides, Program Directors,
etc.




Name
Salary
Work Location
Funding Percentage for Each Program
Final Expenditure Reports
 Must be consistent with budget (amendments filed through County
Office) – EWEG Monitors
 CANNOT:
 Move more than 10% of total funds or $50,000, whichever is
less, without State approval (filed through County Office)
 Add a budget category without State approval (filed through
County Office)
 Carryover more than 15% of total amount received more than
once every three years without State approval (Must have good
reason)
Carryover of Funds
(Set Asides)
Some Carryover Funds are Restricted to the Original
Intent and Purpose of the Funding
**** Accounting Tracking Required ****
 Parental Involvement
 If these funds carried over, then can only be spent for original
intent and purpose or must be refund to SEA
 Professional Development (SINI and DINI)
 If these funds carried over, then can only be spent for original
intent and purpose or must be refund to SEA
Select Expenditures and Support Needed
Fully-funded Salaries
 Periodic certification
signed at least semiannually
 Signed by employee and
supervisor
Select Expenditures and Support Needed
Split-funded Salaries
 Personnel activity reports
 Signed by employee and supervisor
 Must be an after-the-fact distribution of actual
activity
 Prepared at least monthly and must coincide with
pay periods
Select Expenditures and Support Needed
General Purchases





Must have purchase orders
Must have account number on P.O.
Should indicate Title I purchases
Signed by Business Administrator
If split P.O., Title I should be easily identifiable
REMEMBER – Money spent in Individual Schools should
EQUAL amount in Step 4 of Eligibility
13
14
Select Expenditures and Support Needed
Equipment
 Maintain master inventory listing
 Date, Serial Number, Model, Cost, Location
 Each school should maintain subsidiary listing
 All equipment should be labeled with “Title I” or equivalent
tracking system
 Need to keep records for FIVE years past disposition
(date needs to be on master list)
 Even if not equipment for GRANT purposes, if district has
a lower threshold, then tracking of equipment is required
Select Expenditures and Support Needed
Employee Benefits
 TPAF/FICA reimbursement applies only to teachers’
contracted salaries, supervisors and program directors
 TPAF/FICA reimbursement report does not apply to aides,
secretaries or clerical, stipends, substitute teachers or
summer teachers
 All other benefits based on actual cost, not budgeted
percentages
Select Expenditures and Support Needed
Employee Benefits – TPAF/FICA
Reimbursement Report
Salaries
Contractual Salaries
Amounts subject to SS
Amounts only subject
To Medicare
Title 1
Other Federal
Total
Rate
Total
352,808.00
-
352,808.00
-
352,808.00
6.68%
23,567.57
352,808.00
-
352,808.00
-
7.65%
1.45%
26,989.81
-
352,808.00
$ 50,557.39
Selected Items of Cost
 Special rules for specific expenses
 Still subject to basic guidelines
 Examples:
 Alcohol: Never allowable
 Salaries and Wages: Allowable if time
distribution
 Meetings and conferences: Allowable
if dissemination of technical
information
Helpful Questions to Ask When Analyzing
Costs
 Is the proposed cost consistent with federal cost
principles?
 Is the proposed cost allowable under the relevant
program?
 Is the proposed cost consistent with an approved program
plan and budget?
 Is the proposed cost consistent with program specific
fiscal rules?
 Is the proposed cost consistent with EDGAR?
Allowable Costs
All Costs must be:
 Necessary
 Reasonable
 Allocable
 Legal under state and
local law
Allowable Costs
 Must be necessary for the performance or
administration of the grant
 Must follow sound business practices:
 Arms length bargaining (hint: procurement processes)
 Follow federal, state and local laws
 Follow terms of the grant award
NON-PUBLIC
 Continuous Consultation
 District should attempt to find
students attending non-public
schools
Aide in Lieu of
Other Reasonable Method
NON-PUBLIC
 Equitable Amounts for
 Parent Involvement
 Professional Development
 Same Fiscal Rules Apply
 Only your districts students
 Students that need extra services
NON-PUBLIC
 NO longer just supplies/computer – SERVICES ARE
REQUIRED
 Carryover
 Funds not Spent in Prior Year (Discretion)
 Automatic flow of district carryover in EWEG
Use of Third Party Providers for Non-Public
Services
Third Party Provider Contracts
 When bid, the specifications should have the Stephens
Amendment wording
 Vendor Complaint Policy
 Details on who provides parental involvement activities
 Renting/Ownership of Supplies, Trailers, etc.
 Breakout of Invoices to Include:




Instructional Salaries and Benefits
Instructional Supplies
Rental of books, supplies, trailers
Administrative Charges/Profit
Use of Third Party Providers for Non-Public
Services
Administrative Costs of Third Party Providers counts
against the District’s Five Percent (5%) Total
Administrative Costs
Who pays the Administrative Costs? Off the top
allocation of the District of Other Title I Funds (USDOE
Non-Regulatory Guidance)
Policy Statements
District Policies on:
 Maintenance of Effort
 Comparability
 Supplement vs. Supplant
Policy Statements
Maintenance of Effort
 Current Expenditures (Not Including Capital Outlay)
 Less: Community Services
 Divided by: Average Daily Enrollment
 Compare to prior year (current year/prior year) and must
be at least 90%
*** Must Be Done Annually ***
Policy Statements
Maintenance of Effort Example
Amount Per
Student
Line
Description
1
Amount from 2004-2005
$
5,098,944
377.50
13,507.14
2
Amount LEA had to Spend in 20052006 (90% of Line 1)
$
4,589,050
377.50
12,156.42
3
Actual Amount Spent in 2005-2006
$
5,095,897
398.00
12,803.76
4
Amount District Failed to Maintain
5
Percent of Reduction in 2006-2007
EXCESS
Aggregate Expenses
Average Daily
Enrollment
$
506,847
$
647.34
Policy Statements
Comparability
 Compare Like-Kind Schools (Title 1 to Non-Title 1)
or
 Compare Like-Kind Title 1 Schools to each other
or
 Compare Like-Kind Grade Span Groupings
(Elementary, Middle or High)
Policy Statements
Comparability
The average number of students per instructional staff
for Title I schools does not exceed 110 percent of the
average of schools not participating in Title I
programs;
or
Policy Statements
Comparability
The average instructional staff salary expenditure per
student for Title I schools is at least 90 percent of the
average of schools not participating in Title I
programs.
Policy Statements
Components
 Short Form
Instructional staff only Full Time Staff Equivalent (FTE) (Para’s only
count as ½ FTE for every full FTE)
Pupils enrolled
Different sheets depending on if ALL schools are funded or if some
are funded and some are not
 Long Form (if required)
District-wide salary scale
All employees at first range of scale
NEW TIMELINES STARTING 2008-2009 (Due December 4th)
** Required to document compliance every year **
Supplement Not Supplant
 Funds must be “supplemental” to local spending
 Supplemental Defined:
“In the absence of federal funds, would funds have
been spent (prior year funding is one distinguishing
factor)”
Supplement Not Supplant
 If all students/classroom get items, district can’t
pay for Title I part out of Title I funds
 Items purchased should not be used by non-Title I
students
 Presentations/Trips should not benefit non-Title I
students
 Special rules apply to approved and implemented
“Schoolwide Programs”
Schoolwide Programs
 MUST have approved plan that addresses all
schoolwide issues
 Time sheets are required (except in a blended
resource fund, e.g., Fund 15 for Abbott districts)
Schoolwide Programs
 Approval on a school by school basis
 Key questions to be addressed:
 Do the activities budgeted support the intent of the law?
[Federal Register: July 2, 2004 (Volume 69, Number
127)]
 Are supplemental services provided to the students
enrolled in the school?
Frequently Asked Questions
Time Sheets and Salaries
Q: Multiple Federal Grants – If someone works on
multiple federal grants, must their salary be allocated
to all the grants since it is one large federal pot of
money?
A: Yes, since each is a separately funded program.
Frequently Asked Questions
Title I Set-Asides: Choice/SES
 If no Choice than all SES, If no SES, then all Choice, If both
minimum 5% for each and 10% district option.
 May use state or local money to meet this obligation – just be
able to verify
 Must track per pupil expenditures by student
 New rules for reallocation of unspent SES in current year
 Must show copies of letters and multiple offerings (at least twice and 30 days
registration period each offering)
Frequently Asked Questions
Title I Set-Asides: Teacher and Paraprofessional
Qualifications
 Must set aside not less than 5% unless lesser amount is
needed and can be documented that it is not needed.
 All teachers in Title I schools can benefit, not just Title I.
 May not use in Non-Title I schools.
 North Dakota Policy Letter
Frequently Asked Questions
Title I Set-Asides: Parental Involvement
 Must show that at least 1% was spent on grants over
$500,000.
 Be able to document all parental involvement activities
with associated costs
 95% must be at the school level and 5%can be at the
district level
 Remember Carryover Restriction and Tracking of
Funds
Frequently Asked Questions
Title I Set-Asides: Professional Development
 Must set-aside 10% if school is identified as in
need of improvement.
Remember Carryover Restriction and Tracking of
Funds
If Parental Involvement or Professional Development
reserved, then proportional amount for nonpublic
(Regulations 200.65(a))
Other Important Fiscal Considerations
 Grant Year
 Start date of grants – some start July 1st and some start September 1st (NCLB)
 Don’t encumber funds prior to start of Grant
 Now Grants will entertain requests to encumber funds prior to September 1 (But
you must seek permission)
 Final Amendments due by June 30th for NCLB (Depending on EWEG issues)
 Summer
 NCLB runs through August – Separate summer expenditures from current year
 Carryover
 Oldest money automatically used first!!!! Make sure your Auditors know so
Due to Grantor not in CAFR – started with 2005-2006 Carryover into 20062007
Other Important Fiscal Considerations
Carryover
Oldest money automatically used first!!!!
Make sure your Auditors know so Due to Grantor is not
in CAFR, Schedule of Federal Expenditures – started
with 2005-2006 Carryover into 2006-2007
Other Important Fiscal Considerations
Title I Monitoring
AA Team

Random Sample

Other Criteria
 Size of Grant
 Office of Fiscal of Accountability & Compliance Follow up
 Prior year follow up

Program Content

Fiscal Content
Fiscal News from Washington
New Haven Audit Report from Office of Inspector
General
 Supplanting in a Schoolwide Program
http://www.ed.gov/about/offices/list/oig/auditreports/a02f0
005.pdf
Fiscal News from Washington
William Floyd Audit Report from Office of Inspector
General
 Unsupported Expenses
 Unsupported Adjusting Journal Entries
 Supplanting of Textbooks
 Weak Internal Controls
http://www.ed.gov/about/offices/list/oig/auditreports/a02f00
30.pdf
Fiscal News from Washington
City of Detroit and Parent Involvement Fund
2005
 Disallowed Charges for Entertainment, Promotional Items
and Public Relations
 Need to be necessary, reasonable, allocable and
documented
 Disallowed items include advertising for an event and live
musical entertainment at parent volunteer function
http://www.ed.gov/about/offices/list/oig/auditreports/a05f0018.pdf
Fiscal News from Washington
City of Detroit
Revisit in 2008

Over $131 Million in 2005 and $126 Million in 2006


No Time Sheets – Almost $50 Million
Teaching non-Title I students – even though most of Detroit is schoolwide some schools are
not (no plan submitted) and OIG looked to these schools and found staff being funded that
were teaching non-Title I identified students. Detroit argued they could have been schoolwide
if they did a plan and the OIG rejected this argument
Over $21 M for adjusting entries for employees that were charged to other programs and then
charged to Title I
Gift cards they could not show got to students
$150,000 for martial arts training



Fiscal News from Washington
St. Louis OIG Audit
 Lost 125 Computers
 Serving Ineligible Schools
 http://www.ed.gov/about/offices/list/oig/areports.html
Common Audit Findings
 Personnel not listed in board minutes (with Title I
percentage) for current year and carryover
 Lack of time sheets (or signature of
employees/supervisors)
 TPAF/FICA not being properly calculated
Common Audit Findings
 Improper payroll distribution (not pro-rated)
 Purchase orders not indicating Title I (and
adjusting entries to reclassify amounts)
Common Audit Findings
 Policies not being updated for current law
 Supplanting on purchases of non-salaried items
 Not spending at the schools approved in the
application
 Not liquidating within 90 (ninety) days of the end of
the grant
Conclusion
Remember:
 “If you take the money, you are responsible for
knowing the rules and regulations concerning the
grant.”
 If you need further help contact Anthony Hearn
(609) 633-2492
[email protected]