CS. Financial Management of Grant Funds

 

PURPOSE

This policy outlines general administration requirements and procedures of the federal and non-federal grants and contracts. The Grant Accounting Office, under the oversight and direction of the Vice President for Business Affairs, is generally responsible for administration of the fiscal aspects of grants and contracts such as maintaining the Restricted Fund General Ledger, establishing budgets for approved projects, reviewing and approving personnel action forms, reviewing and approving requisitions for purchases, reviewing and approving travel itineraries, and preparing and submitting the necessary forms and financial reports. The VPBA is responsible for the development and negotiation of the indirect cost rates. All other aspects of grant and contract administration are coordinated through the Vice President for Institutional Advancement (VPIA) and the President’s Office.

 

RESPONSIBLE PARTIES

For each grant, the person responsible for insuring compliance with the guidelines of the granting agency is designated in advance. Some grants allow wide latitude in making budgetary changes during the grant, while others require prior approval by the funding agency. It is essential that these guidelines be followed accurately. In case of questions about whether a proposed change requires approval by the funding agency, consult the project director, for both federal and state grants, and consult the VPIA for any foundation or corporate grants.

 

REVIEW AND APPROVAL OF GRANTS

The VPBA, Grant Accountant, and President must review and approve all proposals for grants. In addition, the Institutional Advancement Office and/or the South Plains College Foundation are responsible for coordinating grant-seeking and application process for private grants from foundations, corporations and other philanthropic organizations. The Grant Approval Form must be completed and submitted for approval with all grant proposals. The Grant Accountant reviews and approves the budget portion of all proposals with budgeted employee compensation costs, benefits, or indirect cost amounts.

 

CASH DRAW DOWNS AND ACCOUNTING FOR GRANT FUNDS

The College does not normally receive grant funds in advance of expenditures. The majority of funds are requested on a reimbursement basis. The Grant Accountant tracks expenses and informs the Director of Student Business Services to draw down any federal funds from the Department of Education G5 website. The Grant Accountant files all financial reports required and the College is reimbursed primarily on a quarterly or monthly basis.

Federal funds shall be expended in accordance with federal laws, guidelines, and regulations or as specified by the funding source. Grant funds shall be expended solely for the project approved by the grant application. Funds from grants may not be loaned to other projects or program.

All grant proposals must be approved by the funding agency prior to the expenditure of any funds. Budgetary accounts shall be established in advance of expenditures.

Financial tracking and reporting on grant funds shall be administered by the Grant Accountant in accordance with generally accepted accounting procedures and the regulations and requirements of the applicable funding agency.

 

SOUTH PLAINS COLLEGE SUPPLANTING POLICY

SUPPLEMENTING VERSUS SUPPLANTING

The purpose of this policy is to provide guidelines and measures for the use of state and federal funds so that the funds supplement the activities of the College and do not supplant activities. Supplanting occurs when a state or unit of local government reduces state or local funds for an activity specifically because federal funds are available (or expected to be available) to fund that same activity. When supplanting is not permitted, federal funds must be use to supplement existing state or local funds for program activities and may not replace state or local funds that have been appropriated or allocated for the same purpose. Additionally, federal funding may not replace state or local funding that is required by law. If a question of supplanting arises, the applicant or grantee will be required to substantiate that the reduction in non-federal resources occurred for reasons other than the receipt or expected receipt of federal funds.

Funding provided under the Perkins Act shall supplement (increase the level of services) and not supplant (take the place of) state, local, and other federal funds. Awarded Applicants shall not use Perkins funds to supplant funds that, in the absence of Perkins funds, would have been spent on career and technical education (CTE) students.

Federal funds cannot be used to pay for services, staff, programs, or materials that would otherwise be paid with state or local funds.

Any program or activity required by State law, Texas Higher Education Coordinating Board (THECB) rules, or local board policy may not be paid with Perkins funds. State or local funds may not be decreased or diverted for other uses merely because of the availability of Perkins funds. The Awarded Applicant shall maintain documentation that clearly demonstrates the supplementary nature of Perkins funds.

In adherence to Perkins’ RFA requirements, whenever a recommended Perkins’ budget item is questionable, discussion between appropriate Instructional Dean, Perkins’ Director, Program Director, and Grants Accountant is required to determine budget eligibility. Before a questionable item is considered for Perkins’ budget, THECB Perkins’ Contact is contacted with explanation, and “documented approval” is attained.

Presumption of supplanting

An Awarded Applicant may be considered in noncompliance with the supplement-not-supplant requirement if Perkins funds or any federal grant funds are used to provide services that the Awarded Applicant is required to provide under State or local law, rule, or a court order. Also, Awarded Applicant could be considered in noncompliance for any cost to Perkins federal funds for any service that was previously funded with State or local funds.

If a program or activity cost was funded with non-federal funds in one year and with Perkins funds the next year, an auditor would most likely make a presumption of supplanting. However, the Awarded Applicant then has the opportunity to rebut the presumption. In view of the current reductions in state appropriations and local tax revenues, an Awarded Applicant may be justified in funding the cost with Perkins funds.

For a decision to allocate Perkins funds in this way, the Awarded Applicant should have two types of documented evidence that supports its action:

1. Evidence of an actual reduction in state and/or local support and/or other non-federal support. Examples of such evidence are state appropriation language or a communication from the THECB regarding a reduction in state funding. There may be similar examples relating to reduced funding from local or private sources.

2. Proof that the activity/program would be discontinued without the benefit of Perkins or other federal funds. Examples of this type of evidence might be minutes from a meeting called by the college president or minutes from a faculty meeting.

The Awarded Applicant should have proper evidence in place before taking this kind of action. The THECB may request copies of the documented evidence (as described above) prior to approving a budget amendment that would reallocate Perkins or other federal funds to an activity or program previously funded by non-federal funds.

Approved Administrative Council: November 5^th, 2020

 

PURCHASING AND INVENTORY

All purchases made with federal, state or local grant funds shall be in compliance with applicable laws and the purchasing policies and procedures of the College. Equipment purchased with federal or state funds shall be inventoried and recorded as federal or state property.

When disposing of equipment/property that was originally purchased with federal/state funds the college will follow the rules of the said grant or contract that governs the grant.  Also the college procedures will be followed as referenced in section CL. Disposal of Property.

For the Carl D. Perkins funds the following rules will be used for the disposal of Perkins’ funded property.

CARL D. PERKINS’ CAREER AND TECHNICAL EDUCATION ACT OF 2006, Title I

DISPOSAL OF PERKINS’ FUNDED PROPERTY

Perkins’ funded inventoried property, equipment, and supplies, which are antiquated and no longer usable by a CTE program, must be relocated/disposed in accordance with the following procedures:

METHODS OF RELOCATION/DISPOSAL

• If inventoried item is relocated from original inventoried location to a different permanent location, CTE program must contact Inventory Clerk with new location.
• If inventoried item can be used by another CTE program within the same department, item must be moved to new program and receiving program must contact Inventory Clerk with new location.
• If inventoried item cannot be used by another CTE program within the same department, but can be used by another CTE program in a different department, item must be moved to new program and receiving program must contact Inventory Clerk with new location.
• If inventoried item cannot be used by another CTE program, but can be used by an Arts & Sciences department, item must be moved to new program and receiving program must contact Inventory Clerk with new location.
• When an inventoried item can no longer be used, program must contact Inventory Clerk regarding item disposal. Inventory Clerk will process transfer of inventory record to disposition record including identification number, description of property, acquisition date, acquisition cost, disposition status, and date.
• Public Auction - Periodically as disposable items accumulate in sufficient quantities, the college may dispose of them by way of public auction or;
• By any legal options available.
• Sealed Bids - Should there not be sufficient items accumulated for public auction sealed bids may be taken.
• Purchasing Office will initiate sale or trade-in of all Perkins’ funded items. Any/all revenue generated from the sale of Perkins’ funded item(s) must be applied into appropriate Perkins’ account.

ADVERTISEMENT FOR BIDS
Should property, equipment, or supplies be offered for sale by public auction or sealed bids the college shall advertise in the local and/or regional newspaper on at least two separate occasions. No sale shall be made until the fourteenth day after the first notice is published.

 

TIME AND EFFORT REPORTS

South Plains College is required to have supporting documentation for any compensation charges made to grant funds. Each funded staff position committed by the College for any percentage of time in any institutional awarded grant project must complete time and effort reports. These reports must be completed weekly or Semi Annual depending on the positions and evaluated, approved, and signed by appropriate supervisor. These reports are to be kept in the Grant Accountant’s Office or Project Director’s office for audit purposes.

 

PERSONNEL

If a new employee must be hired for a grant, the Grant or Project Director shall contact the Human Resource Office to obtain proper hiring procedures. South Plains College benefits, including vacation, sick leave, and personal leave apply to all grant employees.

 

STEWARDSHIP AND PROGRESS REPORTS

In collaboration with the Grant Accounting Office, the Institutional Advancement Office shall prepare an internal Grant Activity Report.

The Grant Accountant is responsible for preparing the required expenditure reports for federal and state grants and contracts. The Project Director is responsible for preparing any program reports required by the grant.

The VPIA is responsible for preparing stewardship reports for grants from corporations and foundations. The financial data included in these reports should agree with the College's general ledger data and should be verified and confirmed by the Grant Accountant Office.

All state and federal grant reports shall be reviewed and approved by the Grant Accountant. Actual filing of all such reports with the federal funding agency shall be the responsibility of the Grant or Project Director.

 

RECORDS STORAGE AND RETRIEVAL

Records pertaining to Restricted Fund operations shall be maintained by South Plains College in accordance with federal guidelines on record retention.

 

Revision Issued: April 25, 2017

Approval: Executive Council