Grants and Other Financial Assistance Programs
Grants for Schools: Getting Them and Using Them, A Procedural Manual
How Grants Are Made Available
- Request for Proposals Process
- Components of the Request for Proposals: Flow Chart:
- Kinds of Grants Available
- Components of the Grant Application
How to Complete the Grant Application
- Guidelines for the General Applicant Section (Part I)
- Guidelines for the Budgetary Information Section (Part II)
- General Guidelines
How Grants Are Awarded
- Application Review
- Awarding Grants
- Appeals Process
How to Manage Grants
- Request for Funds Process
- Amendment Process
- Final Reporting Process
- Unexpended Funds and Preliminary Expenditure Review
- Financial Audit
How Grants are Made Available
- Request for Proposals Process
- The Department of Elementary and Secondary Education notifies all school districts and other interested parties about the availability of grants through the Request for Proposals (RFP) process. Individual RFPs are disseminated by program units, and are posted on the Department's web site , on the Grants Management information pages.
The Requests For Proposals, also known as 'funding opportunities', each provides specific and related information about the included grant program(s).
Kinds of Grants Available
The five kinds of grants available from the Department are entitlement, allocation, continuation, other non-competitive, and competitive.
- Entitlementgrants are awarded to recipients on the basis of formulas set forth in laws or regulations. Recipients are entitled to receive funds if they comply with the programmatic requirements outlined in the RFP.
- Allocationgrants are awarded to recipients based on formulas developed to promote Department priorities. The programmatic requirements outlined in the RFP must be met before the grant will be awarded.
- Continuationgrants are those in which the recipients of grants in one year are awarded funds at the same level for the following year. These are grants that were initially competitive and are funded for multiple years on a continuation basis.
- Other Non-Competitivegrants are awarded on a first come, first served basis, or to a limited number of recipients based on certain eligibility criteria, or on a continuation basis to the same recipients but at a higher level of support.
- Competitivegrants are open to applicants that meet eligibility criteria listed in the RFP. Reading teams and rating sheets are used in the review process to ensure a fair and open competition among eligible applicants.
Entitlement, allocation, continuation, and other non-competitive grants are reviewed in a similar manner because the amount of funds for which each eligible applicant may apply is known either at the time the RFP is issued or soon after. Approval is contingent upon applicants meeting program requirements as stated in the authorizing statutes or regulations.
Competitive grant proposals are subject to objective assessment of their relative merits and the grants that are recommended for funding must be presented to the Commissioner and Board of Elementary and Secondary Education for approval.
Components of the Grant Application
- Instructions for the Standard Contract Form and Application for Program Grants
- Part I - General - Standard Contract Form and Application for Program Grants includes the following items and the requested information is required by law or regulation for all grant applications.
- Applicant agency district code, name, address, telephone number
- Grant program name(s), fund code(s), project duration, amount requested
- Authorized signature of applicant agency representative
Note: All sets of an application should have an original signature of an authorized representative.
- Part II - Project Expenditures - Detail Information includes the following items and the requested information is required by law or regulation for all grant applications.
|A.||Grant program Fund Code|
|B.||Applicant agency name, applicant agency code, contact person name, address, telephone number, and e-mail|
|C.||Assignment through Schedule A (if applicable)|
|D. - I.||Staffing Categories|
- Lines 1 - 10
- Specific budgetary information structured in an object of expenditure or line item format and containing sufficient sub-line item information to comply with the relevant laws is required.
- Refer to the Instructions for the Standard Contract Form and Application for Program Grants for detailed directions.
- Part III - Program Information (narrative) is required for all competitive grants to provide sufficient programmatic detail on which to base funding decisions. In addition, many entitlement, allocation, and continuation grants must provide program information as a prerequisite for funding. Whenever possible, simplified standard forms are provided to collect this information.
- Part IV - Statistical Information may be required for some programs. Its purpose is to collect quantitative information needed to comply with laws and regulations.
All applicants are advised that:
- federal and state regulations require that separate and auditable records be maintained for each grant project;
- funds must be administered in compliance with relevant federal or state laws, regulations, or policies; and
- for most federal entitlement grants there is a required annual Statement of Assurances document that must be signed prior to grant submission, to certify applicant agreement to meet all program requirements. Applications may also include one of the following standard forms:
- Schedule A (Consolidated Assignment Schedule) is used for entitlement and allocation grants. Schedule A is the mechanism used to allow either a number of small communities to pool their resources to operate a program in a more cost effective manner or any number of districts to assign funds to another district or a collaborative to operate a special program. (See Appendix B.)
- Schedule B (Cost Sharing or Matching Schedule) is used for grants that have a cost sharing or matching requirement. Schedule B is used to document the local matching contributions. (See Appendix C.)
- Schedule C (Statement of Participation and Support) is used for competitive grant applications. Schedule C may be used to record the commitment of multiple districts or organizations to pursue a coordinated project outlined in the grant narrative. (See Appendix D.)
How to Complete the Grant Application
Requests For Proposals contain all the materials and instructions needed to complete applications for Department of Elementary and Secondary Education program grants. The instructions should be used in preparing applications for submission. Additional guidelines follow for completing Part I, Standard Contract Form and Application for Program Grants and Part II, Project Expenditures - Detail Information.
- GUIDELINES FOR THE GENERAL APPLICANT SECTION
PART I - Standard Contract Form and Application for Program Grants
- Part I - A The applicant name and address should be the official name and address of the entity that will be receiving the funds. The applicant should be a legal grant recipient with a vendor code. Names of individuals and particular schools or ad hoc organizations within towns should not appear in this section.
- Part I - B When an RFP is distributed, the application contained in the package will have the fund code(s), program name(s), and project duration dates included. Applicants need to indicate the amount requested for each grant in the AMOUNT REQUESTED column.
- Part I - C The superintendent, assistant superintendent, director, executive director, or other administrator authorized to sign the Statement of Assurances to the Department and receive grants must sign. Ordinarily, teachers, specialists, or principals do not have such authorization. State finance regulations require that a grant with an original signature be submitted.
GUIDELINES FOR THE BUDGETARY INFORMATION SECTION
PART II - Project Expenditures - Detail Information
Due to federal regulations (34CFR, s.80.20) regarding procedures and standards for financial management of grants, detailed project expenditure pages are required for each proposal submitted.
- Part II - Section A Fund Code - Indicate grant program fund code.
- Part II - Section B Applicant Agency - Provide all requested information.
- Part II - Section C Schedule A - This box should be checked only if the grant proposal will be using funds assigned by more than one agency.
- Part II - Line 1 Administrators - Those listed here should have supervisory responsibilities. The number of staff and FTE columns should be completed. Note that number of staff can only be expressed in whole numbers while FTEs (full time equivalents) can be decimals or fractions. The figure used for the FTE should represent the percentage of the salary (or salaries) the grant is supporting. For federally funded grants only:if the administrator(s) paid with grant funds is a member of MTRS, the MTRS box must be checked. Stipends paid to regular salaried supervisory staff for activities outside their contracted working hours should also be listed here (unless the recipient agency has a policy of paying overtime for such activities).
- Part II - Line 2 Instructional/Professional Staff - Those listed on this line should be professional staff who are certified or licensed to provide either instructional or direct services to students. Examples of titles appropriate for this line are teachers, specialists, counselors, social workers, therapists, psychologists, and nurses. One sub-line should be used for each title. For example, if 4 teachers are being hired under the grant, the title teacher should appear on one sub-line only with the column to the right registering the number of teachers as 4 and the FTE column reflecting the cumulative FTEs of those 4 teachers. The same instructions regarding number of staff, FTE, and MTRS as were outlined for Line 1 above apply to this line. Stipends paid to regular salaried instructional staff for activities outside their contracted working hours would also be listed here (unless the recipient agency has a policy of paying overtime for such activities).
- Part II - Line 3 Support Staff - Those listed on this line are generally paraprofessional, clerical, or non-professional staff who provide either non-instructional services or support services. Examples of titles appropriate for this line are aide, tutor, administrative assistant, bookkeeper, secretary, bus driver, bus monitor, and custodian. Note that while aides and tutors may provide instructional services, they may do so only when they are supporting the work of a teacher and are under the direct supervision of that individual in the classroom. The same instructions regarding number of staff, FTE, and MTRS as were outlined for Line 1 above apply to this budget line as well.
- Part II - Line 4 Fringe Benefits - Fringe benefits should be listed in this section. Such items as health insurance, life insurance, county retirement program, and unemployment insurance, etc., are appropriate. Note that overtime and longevity pay are not fringe benefits; they belong with the related salary item. For federal grants only, on the MTRS sub-line a budgeted amount equal to 9% of the salaries of those checked on lines 1, 2, or 3 as members of MTRS must be listed. (See Appendix J.)
- Part II - Line 5 Contracted Services - Rates per hour or day should be listed next to the services indicated. Note that staff hired on an hourly basis without benefits would normally appear on this line along with training consultants, evaluation consultants, auditors, and substitutes. Stipends paid to regular salaried supervisory and instructional staff for activities outside their contracted working hours may also be listed here under OTHER (unless the recipient agency has a policy of paying overtime, but still call it stipends, for such activities).
- Part II - Line 6 Supplies and Materials - Items costing less than $5,000 per unit or having a useful life of less than a year should be listed here. Subject to limitations outlined in RFPs, supplies can include books, paper, art supplies, computer hardware, and software.
- Part II - Line 7 Travel - Reimbursable travel related to the purposes of the grant such as mileage, airfare, lodging, meals, and conference registration fees should be included here. By signing a grant that has described and budgeted funds for out-of-state travel, the approving authority is giving prior authorization for that specified expenditure. No further authorization from the Department is required.
- Part II - Line 8 Other Costs - This sub-line is used to indicate costs associated with a variety of activities outlined in the application instructions. Note that photocopying costs (e.g., $.05 per copy) belong under printing and reproduction in this line, while amounts budgeted to purchase paper for the photocopier would be listed under Line 6 (Supplies). The lease of a photocopying machine would be listed under rental of space/equipment in this line, while the purchase of such a machine would be listed under Line 6 or 10, depending on the cost. Any listing of expenses under "non-classified" will likely prompt questions since almost all allowable costs can be reflected in one of the specific lines or sub-lines of the budget.
- Part II - Line 9 Indirect Costs - The Department of Elementary and Secondary Education determines an indirect cost rate for each city, town, or regional school district for application to state and federal grants and contracts, unless prohibited by federal regulations. If used, the indirect cost figure must be equal to or less than the currently approved restricted rate. The decision to recover indirect costs using these established rates is a local option. The rates are developed for school districts as the maximum allowable rate for a given fiscal year. For non-school districts, indirect costs rates must be established through an application to the Department's Audit and Compliance unit.
In calculating the indirect cost allowable for a particular grant, note that indirect costs cannot be charged on either capital expenditures or on indirect costs themselves. To arrive at the allowable amount one cannot simply multiply a total entitlement by the indirect rate. Instead, it is recommended that the following formula be used:
- total entitlement
- minus capital expenditures (Line 10)
- divided by one plus the restricted rate
The resulting amount is the amount that can be used for grant activities. When this amount is subtracted from the total entitlement, the result equals the amount allowed for indirect cost.
Example: School system A has a restricted rate of .045 and an entitlement of $98,000. There are no capital expenditures. The calculation is:
Note: If indirect costs are recovered, they shall be returned to the general fund of the city or town in accordance with G.L. Chapter 44, Section 53. In the case of regional schools, indirect costs shall be returned to the regional school general fund.
- Part II - Line 10 Equipment - Items costing more that $5,000 per unit and having a useful life of more than a year should be listed here. Equipment must be itemized with a brief statement of the need for the item. Grant recipients are reminded of their obligation to follow and document open and competitive procurement procedures when purchasing equipment and of their record-keeping responsibilities. (Appendix M.)
After completing each grant proposal, the applicant should consider the following general questions.
- Does the application meet the objectives established through the RFP process and related laws, regulations, policies and program guidelines?
- Does the budget balance?
- Does the budget contain whole dollar amounts only? (No cents)
- Does the application exceed the entitlement amount or the stated maximum for competitive programs?
- Are the costs reasonable for the program and comparable to costs in similar programs?
- Are the costs allowable under the terms of the RFP or under the laws, regulations, or policies that govern that particular program?
As a final resource for this section, the Review Checklist, that is used by program staff to perform a technical review of all grants, is provided in Appendix K and may be used as an aid in reviewing grants before submitting them to the Department.
HOW Grants ARE AWARDED
Completed applications are submitted, according to instructions contained in the RFP, to the Department program unit that administers the grant program(s). The review process includes:
- a program review to ensure that proposed activities reflect program guidelines and are appropriate and measurable. For competitive grants, the program review must also include the kind of careful analysis that will enable the reviewers to rank proposals in comparison to others read;
- a technical review to ensure that the grant has been completed accurately and appropriately; and
- a legal or regulatory review to determine financial and administrative, as well as programmatic compliance, with the relevant laws, regulations, and policies.
Entitlement, allocation, and continuation grants are signed by the appropriate Department of Elementary and Secondary Education administrator as approved, subject to successful completion of a technical review by Grants Management.
Competitive grants are recommended for approval by the appropriate administrator, subject to technical review by Grants Management, and need to be approved by the Commissioner and Board of Elementary and Secondary Education.
- AWARDING Grants
Approved grants are forwarded immediately upon completion of the technical review to Payment Processing, where all the necessary paperwork is done to ensure that grant recipients are sent their funds in a timely manner, according to the required allotment schedule.
Most grants will be submitted for programmatic review and approval during late spring or early summer. Because of state and federal cash management and documentation requirements, an approvedgrant submitted to Grants Management may take a minimum of 2 to 3 weeks for final approval and payment. This makes it especially important that grants be submitted with all required information completely and accurately filled out, including original signatures.
A standard computer-generated grant Payment Notification form is used to officially inform grant recipients of their awards. (See Appendix E.) This form provides important information about the grant, including project duration, approved amount, amount of the initial payment, project number, and (for federal grants) CFDA number.
PROJECT NUMBER: the twelve-digit project number is unique to each individual grant and provides the following information.
- The first series of three numbers is the fund code for the grant and indicates the kind of grant. See Appendix L for a list of fund codes with a brief description of the kind of grant each represents, along with information about account numbers and whether the grant comes from federal, state, or private trust funds.
- The second series of three numbers is the sequence number that indicates the order in which the grant was logged into the Grants Management Information System under a particular fund code.
- The next single number represents the fiscal year (the number 8 stands for fiscal year 2008, the number 9 for fiscal year 2009, etc.).
- The following series of four numbers is the district or agency code and is linked in the Grants Management Information System to the recipient's vendor code. For school districts, the three-digit district code preceded by a leading zero is used. For other recipients (colleges, collaboratives, private non-profits, other public agencies, Head Starts, 766-approved private schools, etc.), a four-digit system code has been assigned.
- The final letter is for internal tracking.
For example, project number 240-007-5-0332-B indicates the following:
|a Special Education, P.L.94-142 entitlement grant||(Fund Code 240)|
|the seventh grant to be logged in for fund code 240||(007)|
|a grant for fiscal year 2015||(5)|
|a grant for the West Springfield Public Schools||(0332)|
If at the conclusion of a programmatic and technical review of entitlement grants or a competitive process to determine which discretionary grants to fund, the decision is made not to fund a particular grant or to withhold funding at any time, the approving authority must notify the grant applicant. If the applicant wishes to request a hearing, the applicant must inform the Commissioner of Education within thirty days of such notification. The request for hearing must include:
- a statement of issues being appealed alleging a violation of state or federal law, regulations, or guidelines governing the applicable program, including an itemization of the matters of fact and law upon which the applicant bases the appeal;
- copies of all documents, correspondence, data, exhibits, and other information that the applicant intends to introduce at the hearing to support its position; and
- a list of witnesses whose testimony will be introduced.
The hearing, conducted by a hearing officer designated by the Commissioner, takes place within thirty days and with at least seven calendar days notice to the applicant. No later than ten calendar days after the hearing, the hearing officer issues a written decision confirming or rescinding the Department's determination that funds should be withheld. An applicant for federal funds may appeal the final decision to the U.S. Secretary of Education within twenty calendar days after written notification of the hearing officer.
HOW TO MANAGE Grants
After a grant has been awarded, either as an entitlement or through a competition, it is the responsibility of grant recipients to ensure that it is implemented in compliance with any applicable programmatic requirements. In the administration of grants, recipients must use fiscal controls and fund accounting procedures that will ensure proper disbursement of, and accounting for, grant funds received under any funding award. (See Appendix O for checklist of standards for financial management systems.) What follows are the standard procedures to be used when requesting funds, making amendments, and final reports on grants.
State Finance Regulations
In accordance with state finance regulations, grant recipients can only expend funds from the date their grant was entered as approved into the Department's Grant Management system. This means that if a district wishes to expend grant funds as of a certain start date, the grant must have completed a programmatic review, and been submitted as approved to Grants Management prior to that start date.Districts may not use local funds to cover initial costs for a grantprior toreceiving official approval from the Department, with the intent to reimburse themselves afterreceiving the award notice. Audit exceptions may be taken for any grant funds used for periods not covered by the award letter, leading to districts needing to pay back the misused grant funds.
For example, districts that wish to begin expending grant funds as of September 1,are advised to:
- Submit grant applications for the full entitlement amounts (or for the amount advised by the Department program until if allocations are not yet available) well in advance of the desired start date.
- Have a local grant contact person available in July and August to respond immediately to any grant questions the Department reviewers may have and make changes required for final approval. This is necessary due to the large number of applications the Department will be receiving in June and the need to have them ready for approval by early August.
The Department will develop a standard process of informing the Superintendent of any contacts made to the identified local contact person to insure that the district is informed of any possible delays in the approval process.
- Sign and return the Grant Assurances Document that will be sent to districts, usually in late May, by the due date established by the Department.
Federal Grant Appropriation System
Due to the federal "partial advance funding" practice which can impact the major entitlement programs including, Titles I, II-A, special education (IDEA), and Perkins grant programs, the Department will receive an initial FY award letter in July from the United States Department of Education (USED) authorizing the distribution of a portion of each federal grant through September 30, of that year. The Department will receive a second award letter for the balance of the allocations in early October.
Therefore, for federal grants needing September 1 start dates:
- The Department will prorate initial allocations to districts in amounts not to exceed the amount received from USED. These amounts will vary from program to program depending on the actual percentages the Department receives in the July awards for each program. The initial award letter issued from Grants Management will indicate a reduced total award amount, as well as a prorated initial payment. For grants approved prior to September 1, this initial award letter will be for the full year grant period.
The Department expects to receive the allocation balances from USED in early October, and districts may submit requests for second payments by the October RF-1 payment period according to program need. Federal and state cash management requirements that grant funds be distributed on an as needed basis are still in effect, however, the allotment schedule detailed on the standard Request for Funds form (RF-1), should be adjusted accordingly for this payment.
- The Department will issue updated award notices with the October payments, reflecting the full award amounts.
Should you have any questions regarding this, please contact the Grants Management payment office, (781) 338- 6572.
REQUEST FOR FUNDS PROCESS- Effective 7/1/2007
As shown in the Flow Chart , once grants are approved and deemed technically correct, the Grants Payment unit will complete the process to generate an initial payment authorization by the State Comptroller. The payments for grants are determined based on the following standard allotment schedule.
|Up to $5,000|
- Full payment with initial award
|$5,001 or more|
- All grants will receive an initial payment automatically upon approval, the amount to be determined by the total grant award divided by the number of months in the grant duration.
- Subsequent payments must be requested on a monthly basis.
Upon approval, aPayment Notification (See Appendix E.) is generated and sent to the authorized signatory and the listed 'control user' for each grant. This notice provides important basic information about the grant, such as the project number, project duration, approved grant total amount, and amount of the initial payment.
The initialpayment is the only one that is sent to recipients automatically. To ensure that funds are distributed on an "as needed" basis in accordance with both state and federal cash management requirements, the balance of funds must be requestedaccording to the above schedule.
Form RF1 for requesting funds through an on-line process has been developed to document the Department's distribution of funds on an "as needed" basis. (See Appendix F.) The requests should be based, as much as possible, on actual expenditures, rather than what is obligated. Unexpended monthly balances should not exceed 10% of funds received to date. It is incumbent upon grant recipients to observe their expenditures closely and submit their RF1 forms within the designated timeframe, usually the last two weeks of the month, for requesting cash advances. Grant recipients may make requests in excess of the allotment schedule but must include a justification explaining the need for additional funds and additional documentation may be required.
By submitting a request the grantee certifies that the request is in compliance with the "Cash Management Act" (31CFR part 205) and EDGAR regulations (34 CFR part 80.20 and 80.21), which allow for cash advances provided grantees maintain procedures to minimize the time elapsing between the receipt and disbursement of grant funds. Additionally, the grantee certifies that the obligations incurred under this project for which funds are requested, were made within the period of availability (project duration) stated in the grant award notice. The grant records in support of each request must be in sufficient detail to properly substantiate all claims for payment and expenditures made under the grant. Although these grant records are not required to be submitted with each monthly request, they must be available for inspection by Department staff at any time.
Adjustments to grant payments are made in the final payment. For example, the amount of money Grants Management sends directly to the Massachusetts Teachers Retirement System (MTRS) on behalf of school systems is deducted from the final payment on their federally-fundedgrants.
In general, grants are awarded for a period of one school year at a time. Because of differences in the state and federal fiscal years, there will be differences in the grant duration between state and federal grants. Typically, a state funded grant will have a start date in July or August, with an end date of the following June 30th, which is the end of the state fiscal year.
Most federal grants will more closely follow the federal fiscal year (October 1, to September 30), and usually start September 1, and end the following August 31. Regardless of the funding source, the final payment on all grants must be requested before the end of the state's accounts payable period, which is August 31. In the month(s) before the accounts payable deadline, Grants Management will send notice to all grantees with remaining unclaimed funds reminding them that failure to claim in time may result in the loss of those funds.
FOR FEDERALLY-FUNDED Grants ONLY
|Each year on December 31, 80% of the money budgeted for MTRS in line 4 of federal grants is sent directly by Grants Management to MTRS (Appendix J).|
Amendments are required when:
- there is any significant change in program objectives; or
- there is any increase or decrease in the totalamount of the grant; or
- an increasein a line of the budget exceeds $100 or 10% of the line (whichever is greater), or exceeds $10,000.
Amendments arenot required when:
- there is no significant change in program objectives;
- there is no increase or decrease in the total amount of the grant; and
- an increase in a line of the budget is less than or equal to $100 or 10% of the line (whichever is greater), and does not exceed $10,000.
When it is determined that an amendment is required, the grant recipient should fill out the standard amendment form (Form AM1, Appendix G),attach revised budget pages and submit it to the appropriate program liaison. After the amendment request is submitted, the following review and approval process takes place.
- Program staff conduct a programmatic and technical review.
- The authorized representative of the Department signs the amendment as approved.
- A signed copy of the approved amendment is sent to the grant recipient by the approving authority.
- The approved amendment is submitted to Grants Management for technical review.
- Review staff notify the Department staff person who approved the amendment of any technical problems.
- When the amendment is technically correct, the revised budget is entered into the computer in Grants Management and the amendment is filed in the project folder. Amendments should be submitted at least thirty (30) days prior to the desired change and must be submitted thirty (30) days before the conclusion of the project. The maximum number of amendments to any grant may not exceed two. Exceptions to this limit may be allowed based on sufficient justification as determined by the appropriate and responsible approving authority in the Department.
In preparing an amendment for submission, the following checklist should be consulted:
- Is the project number correct?
- Does the justification make sense?
- Has the amendment request been submitted prior to the desired change and 30 days before the conclusion of the project?
- Are the revised budget pages attached?
- Are the revised budget pages correct? (Note: The revised budget pages should be completed with the same care as the original budget pages since they now become the official project budget.)
- For federally-funded grants only, if salaries for teachers who are members of MTRS are increased, is the MTRS sub-line under fringe benefits increased accordingly? If salaries are reduced on an amendment submitted after November 1, is the MTRS sub-line reduced by an amount that does not exceed 80% of the amount budgeted as of October 31? (If yes, recipients should contact Grants Management immediately for additional instructions.)
- Does each line in Column A on the AM1 form equal each corresponding line on the originally approved budget?
- Does Column C balance out? (Do the pluses equal the minuses or does Column C equal the amount of increase or decrease requested)?
- Does each line in Column D equal the corresponding line item totals listed on the revised budget pages?
- Does each line in Column D equal the corresponding line in Column A plus the corresponding line in Column C or the corresponding line in Column A minus the corresponding line in Column C?
FINAL REPORTING PROCESS
At the conclusion of grant activities, recipients must submit a final financial report to the Department, accounting for the expenditure of funds received. Grants Management has developed an online process and standard form (FR1) for collecting this information. (Please review the Powerpoint Presentation Appendix H.)The FR1 form should be submitted to Grants Management within sixty (60) days of the end date of the grant. Grant recipients should file their reports after carefully reconciling all figures with their city auditor, town accountant, or agency business manager.
Grants Management checks these reports to ensure that the expenditure of funds for each line item corresponds to the amount budgeted for that line. Note that over-expenditures that fall at or below the $100, 10% or $10,000 line item increase thresholds specified in the Department's amendment policy will be allowed and the final report will be filed. Increases in line items, without approved amendments, that exceed these thresholds, will be subject to possible audit exceptions and the required return of any funds that were expended inappropriately.
FOR FEDERALLY-FUNDED Grants ONLY
The Department has developed an additional form (Form FR1 A, Appendix I) to aid in reconciling expenditures for MTRS. This form can be used to assist in calculating the additional MTRS liability beyond the 80% of the budgeted MTRS amount the Department pays directly to the MTRB for any federal project containing funds budgeted and paid for the salaries of staff who are members of MTRS.
When the additional liability is calculated by subtracting the amount paid directly by the Department to MTRS from actual liability, this amount should be paid to MTRS. No checks for this add additional MTRS liability should be sent to THE DEPARTMENT OF ELEMENTARY AND SECONDARY EDUCATION.
UNEXPENDED FUNDS AND PRELIMINARY EXPENDITURE REVIEW
Grants from the Department are generally awarded for a period of one fiscal year at a time. For all grants, unexpended funds must be returned with the Final Financial Report (FR-1) each year. For grants funded withstate money, unexpended amounts must be returned to Grants Management and these funds revert to the state at the conclusion of the fiscal year and cannot be reused. Unexpended amounts of $1.00 or less do not have to be returned. For all grants, the FR-1 and any unexpended funds must be submitted to Grants Management within sixty (60) days of the end date of the grant.
Most federal grants contain a provision known as the Tydings Amendment, which means that the funds are awarded to the state for use within a 27-month period. For grants funded with federal money, the Department currently has two different methods of ensuring that funds are expended within a twenty-seven month period so that money that has to be returned to the federal government is kept to a minimum.
Return of unexpended funds
Although the expectation is that grantees will fully expend grant funds within the year they are awarded, the Tydings Amendment provides flexibility to sub grantees for most federal entitlement programs such as NCLB Fund Codes: 140, 180, 305, and IDEA 240. The Amendment allows recipients to reapply for any returned funds as an extended use (carryover) grant. In such cases, the program office will issue guidance to recipients as to the procedures they must follow for this reapplication. Recipients should contact the program office if they are unsure whether or not a particular grant allows this reapplication process.
Title I Policy
Currently, the Title I-305 program has a specific carryover limitation within the program regulations. This means that for these grants, recipients with unexpended balances, within certain limits, retain access to those funds for the remainder of the Tydings period. Title I limits the amount a recipient may carry over to 15% of the original entitlement. If the amount of carryover exceeds this limit, a waiver is usually required in order to retain access.
TITLE III POLICY:
In the case of Title III grants (fund code 180); the grant period is stated in the Request for Proposals (RFPs). The Title III grant is for support of programs for students with limited English proficiency, and the data used to determine the allocations for this special population are often delayed at the start of the grant cycle, but most grants to districts are still usually in place by the start of the regular school year (September 1st). Carryover is permitted; however, grantees must return to ESE any funds that are not expended within the stated grant period. Upon return of the funds, districts may reapply for the funds for the following year, consistent with Title III and Department guidelines and timelines.
Pursuant to Section 3114(c) of the ESEA, when Title III funds allocated to a grantee under that section are not or will not be used by the grantee for the purpose for which the allocation was made, ESE will reallocate the funds to other eligible entities in the State that ESE determines will use the amount to carry out Title III purposes. ESE will prioritize the reallocation of these funds to Level 3 and Level 4 districts based on the needs of district LEP and immigrant students, as determined by ESE. ESE reserves the right to determine the criteria for re-allocating Title III funds in this regard.
Perkins Vocational Ed Program Policy
For the Perkins (Fund Code: 400) Vocational Education grant, the program regulations do not allow carryover and for most non-entitlement programs,the returned funds are tracked in terms of their fiscal year but they are no longer considered as belonging to a particular school or district. They simply become part of the pool of old money available to the Department for redistribution. Each program has its own requirements governing how these funds are reallocated within the remainder of the 27 month Tydings period.
As with all grants, the FR-1 and any unexpended funds must be submitted to Grants Management within sixty (60) days of the grant end date.
Preliminary Expenditure Review
Although it is sometimes unavoidable that grant funds are drawn down but not expended, grantees are reminded again of the importance of close monitoring of grant expenditures and maintaining compliance with the "cash management" requirements cited above, and are only drawing funds on an as needed basis.
Many recipients of federalcarryovergrants often plan to limit spending in a current grant year in order to havecarryoverfunds available to cover possible shortfalls the next year. Because of the extended time lag of 60 days (or longer) from the end date of a grant, through submission of the final report and return of funds, and submission of acarryover grantapplication, grantees usually lose a significant amount of the Tydingstime for use of those funds.
In an effort to reduce this lag time, as well as assist in generating more timely and accurate final reports, the Department strongly recommends that grantees conduct A Preliminary Expenditure Review. The intent is to encourage recipients to review grant expenditures within a timeframe (April/May) that allows for a reasonably early determination of which grants will end with an unexpended balance that will have to be returned.
At this point in the grant's lifecycle,, a reduction amendment will be required to be submitted for certain carryover grants, to reduce the grant by the projected unexpended amount. For all those grants that allow for some form of carryover, reducing the current grant total by the carryover amount in advance will free those funds for access at the start of the next year's grant cycle, rather than several months into the new school year. Such a reduction will also lessen the likelihood of grantees unnecessarily drawing down funds, and creating a possible cash management violation.
Due to restrictions within the Massachusetts state accounting system, any such reduction amendments must be approved (by the appropriate program unit) and submitted to Grants Management no later than May 15theach year. Amendments submitted after that date may not be processed in time to change the original grant encumbrance.
All grants, whether carryover eligible or not, would benefit from the preliminary expenditure review, and if appropriate, submission of a reduction amendment to eliminate the need to return funds that clearly will not be used by the end date of the grant.
Evaluating grant programs is an important tool in helping to improve the quality of programs, and a number of federally funded grant programs require that evaluations be conducted on a regular basis. In general, grant programs should be evaluated in accordance with the program design and complexity. The overall purposes of evaluation are to:
- guarantee the program's compliance with federal and state law, regulation, and policy;
- provide the administrators and staff of a grant program with appropriate feedback in order to improve performance (formative evaluation -- conducted during the course of a grant);
- assess the extent to which the grant program actually achieves its objectives as stated in a grant application (summative evaluation -- conducted when the grant has been completed);
- identify exemplary grant programs or exemplary components of grant programs for appropriate dissemination.
Auditing is another management tool for evaluating whether operations are executed economically, efficiently, and effectively. Audits of grant programs should be conducted on a regular basis. For most recipients of federal funds, the audit requirements will be satisfied by the federal "Single Audit" conducted each year. Be advised that recent changes to the Single Audit Act (31 U.S.C. 7501 et seq. as amended) have raised the threshold which triggers the audit of federal funds from $25,000 to $500,000 or more in federal dollars received from all sources and expended in a given fiscal year.
This change will mean that many recipients (those who receive less than $500,000 total federal dollars from all sources), will not be required to have a Single Audit done each year, although they may still be subject to an audit under state regulations. All recipients, however, are required to maintain for purposes of audit or review, records, books, reports and any other data pertaining to a grant award for a period of seven (7) years, beginning on the first day after the final payment is received for that award. These books and records must be in sufficient detail to properly substantiate all claims for payment and expenditures made under the grant.