Expanded Authorities Financial Monitoring 1 The Expanded Authorities

Expanded Authorities & Financial Monitoring 1

The “Expanded Authorities” Amendments Greater flexibility for managing ED Discretionary Grants 2

“Expanded Authorities” GOALS: o Increase flexibility o Increase accountability o Reduce paperwork burden o Develop partnerships O Promote successful project outcomes 3

“Expanded Authorities” o Pre-award Costs o Carryover o Budget Transfers o Time Extensions 4

Pre-award Costs Incurred up to 90 days before budget period begins • No prior approval required • Applies to New and NCC awards 5

Pre-award Costs o Reasonable expectation of receiving a grant o Incurred at own risk o ED funds are not available for drawdown until the budget period begins o Not for cost over-runs 6

Pre-award Costs Incurred more than 90 days before budget period begins: Requires prior approval OK 7

Carryover o Unexpended funds are carried over without prior approval o For any allowable cost within the approved project scope 8 finishing uncompleted activities 8 new activities within scope 8

Carryover o Program Office may require a written statement • How will unexpended funds be used? • When: At time of funding decision • In rare cases, new funds may be reduced 9

Budget Transfers o No prior approval required for most budget transfers o Exceptions in EDGAR: 10% rule h Transfer training funds to other categories h Transfer or contracting out any work o Check OMB Cost Principles for other exceptions 10

EDGAR Prior Approval Requirements o Changes in project scope or objectives o Changes in key personnel o IHE and non-profit project directors: h Absence for more than 3 months h 25% reduction in time o Need for additional federal funds 11

Time Extensions Final Year: o One-time extension for up to one year without prior approval o Grantees should carefully consider time extension needs 12

Time Extensions o Send written notice to program officer: i No later than 10 days before project ends h State reasons for extension h Include revised expiration date 13

Time Extensions o Not just for using unexpended funds o No additional federal funds o No change to scope or objectives 14

Important Reminders o Check grant terms, conditions and grant award attachments for possible exceptions o In rare circumstances, some or all may be denied o When in doubt, call your Program Officer 15

Conclusion New spirit of partnership Focus on successful project outcomes! We welcome your feedback. Let us know what’s working and what’s not. Internet address: grantspolicy@ed. gov 16

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Financial Management/ Monitoring in GAPS Grant Administration & Payment System 18

Grant Administration & Payment System o Request drawdown by grant award number o Drawdowns treated as expenditures 19

Grantee o receives grant award from ED o administers the grant in accordance with ED regulations o DUNS number needed to participate 20

Payee o Requests and manages funds i May be the grantee or other entity identified by the grantee i Needs DUNS Number to participate 21

Payment Methods U. S. Department of Education ò Advance Payment Method ñ Reimbursement Payment Method 22

Receiving ED Funds Your Bank 23

Cash Management Drawn funds must be expended within three business days after they are deposited in your bank account. 24

Monitoring For Results o Performance monitoring o Financial monitoring 25

The Results Act The Government Performance and Results Act of 1993 (GPRA) o Develop program standards & indicators o Ties federal funding to results! o What is happening with the money? 26

Grant Teams Monitor *GAPS* Track spending patterns for each grant Why: q Identify performance problems q Identify financial management problems q Work in partnership to resolve 27

What Grant Teams Are Looking For Rate of draws: Commensurate with approved scope of work & project milestones? 28

Exercise #1 - LLU o Grant for $275, 000 to LLU their first federal grant o Project was on track, meeting goals and objectives o Performance report indicated $200, 000 expended o GAPS shows no funds drawn down 29

Exercise #2 - Bob. U o Bob. U received $75, 000 grant o Performance report indicates $25, 000 unexpended o Program officer calls grantee to discuss why Bob 30

Exercise #3 - SKI o SKI receives $400, 000 grant o Key milestones being reached on schedule o GAPS indicates all $400, 000 was drawn down in first three months Smarter Kids. . . Start Here! 31

When Grant Teams Check GAPS i Throughout the life of the grant i At the end of each budget period i Before performance monitoring i Before technical assistance contacts 32

Red Flags o Not drawing down funds//Regular draw downs not being made h Is work being performed? h Are performance indicators being met? h Is there a financial management problem? . Work is being performed, but payee is not drawing down funds 33

Red Flags o Large amount of unobligated funds at end of budget period h Has grantee made substantial progress? h Other issues: i. Did project have a late start (Year 1) ? i. Did key personnel leave the project? 34

Red Flags o Excessive amount of funds drawn down h Draws exceed immediate need (3 -day rule) h Draws not in line with project scope & milestones 35

Conclusion o Project Directors: Communicate with your Fiscal Staff o Ensure that the drawdowns in GAPS reflect status of project o Grant Teams rely on drawdown in GAPS to monitor your project 36

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