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

Title I Fiscal Responsibilities

Presented by:New Jersey Department of Education

Office of Student Achievement and Accountability

Are You Fiscally Compliant?

What is Needed to be in Compliance & Where to Find It

No Child Left Behindwww.ed.gov/legislation/ESEA02/index.html

OMB Circular A-87, Attachment Bwww.whitehouse.gov/omb/circulars/a087/a087_2004.pdf

EDGAR http://www.ed.gov/policy/fund/reg/edgarReg/edgar.html

Compliance Supplement (A-133) hhttp://www.whitehouse.gov/omb/circulars_a133_compliance_08_08toc/

General Education Provisions Act (GEPA): straylight.law.cornell.edu/uscode/html/uscode20/usc_sup_01_20_10_31.html

http://www.ed.gov/policy/fund/reg/edgarReg/edgar.html

http://www.whitehouse.gov/omb/circulars_a133_compliance_08_08toc/

http://www.whitehouse.gov/omb/circulars_a133_compliance_08_08toc/

http://straylight.law.cornell.edu/uscode/html/uscode20/usc_sup_01_20_10_31.html

http://straylight.law.cornell.edu/uscode/html/uscode20/usc_sup_01_20_10_31.html

Legal Structure and Requirements

Statutes

Program Regulations

ProgramGuidance

OMB CircularsEDGAR (Parts 76 & 80)

OMB A-133 Compliance Supplement

Letters/Press Releases

Office of Inspector General

System Requirements for LEAs EDGAR §§ 80.20, 80.32, 80.36

Financial Management=80.207 Key components

Financial Reporting (Ability to Report)Accounting RecordsInternal ControlsBudget ControlsAllowable CostsSource DocumentationCash Management

System Requirements for LEAs EDGAR §§ 80.20, 80.32, 80.36

Equipment=80.32 (more details later) Procurement=80.36

Open competitionCost/Price AnalysisVendor SelectionContract Administration

Board MinutesWhat 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 semi-annually

Signed by employee and supervisor


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


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

1313

1414


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


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


Employee Benefits – TPAF/FICA Reimbursement Report

Salaries Title 1 Other Federal Total Rate Total

Contractual Salaries

352,808.00 -

352,808.00 -

352,808.00 6.68% 23,567.57

Amounts subject to SS

352,808.00 -

352,808.00 7.65% 26,989.81 Amounts only subject - 1.45% - To Medicare

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

Line Description Aggregate ExpensesAverage Daily

EnrollmentAmount Per

Student

1 Amount from 2004-2005 $ 5,098,944 377.50 13,507.14

2 Amount LEA had to Spend in 2005-2006 (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 $ 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 enrolledDifferent sheets depending on if ALL schools are funded or if some

are funded and some are not Long Form (if required)

District-wide salary scaleAll 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.


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)


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


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


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

FundsIf 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 2006-2007


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


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/a02f0005.pdf




William Floyd Audit Report from Office of Inspector General

Unsupported Expenses Unsupported Adjusting Journal Entries Supplanting of Textbooks Weak Internal Controls





City of Detroit and Parent Involvement Fund2005

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 functionhttp://www.ed.gov/about/offices/list/oig/auditreports/a05f0018.pdf



City of Detroit Revisit in 2008

Over $131 Million in 2005 and $126 Million in 2006 No Time Sheets – Almost $50 MillionNo Time Sheets – Almost $50 Million Teaching non-Title I students – even though most of Detroit is schoolwide some schools are 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 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 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 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


St. Louis OIG Audit

Lost 125 Computers Serving Ineligible Schools http://www.ed.gov/about/offices/list/oig/areports.html

http://www.ed.gov/about/offices/list/oig/areports.html

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


Improper payroll distribution (not pro-rated)

Purchase orders not indicating Title I (and adjusting entries to reclassify amounts)


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) [email protected]

mailto:[email protected]

Documents

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