21st CCLC Budget Webinar April 2010

TERMINOLOGY Budget Summary – restates project plan as expenses Budget Breakdown – itemizes and describes expenses Payment Schedule – reflected monthly expected costs of budgeted plan Expenditure Report – quarterly cumulative report of actual expenditures, based on approved budget

BUDGETS A budget is a project plan in which ideas are translated into expenses. No budget when submitted is more than an informed estimate of the costs to be incurred, but careful planning insures financial support is in place when needed.

IMPORTANT GRANT GUIDELINES Project Begin Dates Start date is dependent on grant receipt at ISBE. Grants cannot begin prior to JULY 1. Grants received at ISBE after JULY 1 begin on the day that a substantially approvable budget is received. Recipients submitting grants in “substantially approvable” form can begin obligating funds at the time of receipt by ISBE without written approval. If in doubt, do not obligate. If in doubt – do not obligate – COMMUNICATE! Continuation grants – second and/or third year – must still submit fiscal year budget within timely manner to receive the begin date you want – not automatic that you get 7/1 each year of continuation.

IMPORTANT GRANT GUIDELINES Project End Dates In general, grants should be operated in a twelve month period, usually July 1 to June 30. August 31 end date applicable to projects offering summer activities past June 30. End date extensions MUST be requested 30 days prior to the end date of the project. Extension requests done via a budget amendment All project activities must occur within the project begin and end dates Begin obligating funds as of the project begin date and NO activities can occur after the project end date.

GRANT BUDGETS Do not “doctor” another form to submit. Understand allowable direct costs, forms and instructions. Make sure important contact information is provided. -- Region-County-District-Type Code -- Contact Name, Address, Phone, Fax -- Use forms that are provided -- Send with original signatures Do not “doctor” another form to submit.

COST ALLOCATION PLANS Written plan that states how an entity will accumulate and distribute allowable admin costs in grants and identifies the methods used for distributing Examples in Fiscal Policy and Procedures Handbook Audits required yearly and may be charged to grant—prorated according to grants being audited

GRANT ACTIVITIES Grant activities must be completed within the project beginning and ending dates. Obligated funds can only be for projects that will fall within the timeline of the grant. Liquidation of all obligations, including current year’s audit fee should be completed no later than 90 days after the project ending date.

CONTINUATION APPLICATIONS No automatic continuation of a grant Grants received by July 1 receive a July 1 begin date. After July 1, the begin date is the day the budget is received (with Continuation Application) at ISBE. Budget negotiations and corrections may continue after the date of receipt. No carryover of funds from previous year. Unused funds become prepayment on FY11 grant amount.

SUPPLEMENT vs. SUPPLANT Cannot approve regular expenses—e.g. rent, utilities, etc., that are regular cost of “doing business.” Cannot approve expenses required by state law Principals’ and superintendents’ salaries and other supervisory personnel required by state law cannot be charged to a grant. Payroll must be supported by time and effort documents. Only costs incurred as a result of the grant, e.g. additional clerical time, additional phone usage, renting a meeting room for professional development.

REASONS FOR FREEZING FUNDS Cash on hand Turn in an interim expenditure report to have funds released Not doing annual audit Not doing PPICS Secretary of State informs ISBE of CBO/FBO not being in good standing

UNSPENT FUNDS Unspent funds in one year will be considered prepayment on the next fiscal year grant. Unspent funds in the final year of the grant will be forfeited or returned to ISBE if they have already been sent to the grantee. Please use all funds but always use wisely.

INTEREST INCOME Grantees or sub-grantees can keep interest amounts only up to $100. This interest must go back into the program. Other interest MUST be returned. Checks should be made payable to ISBE which will make payment to USDE. Checks should be accompanied by a statement identifying the program and program year from which the interest was earned.

GRANTEE REQUIREMENTS A completed copy of the approved application, approved budget, and approved amendments must be maintained by the grant recipient. Continuation applications and budgets must also be maintained. Documents are reviewed by ISBE staff to determine fiscal and program compliance. EDGAR rules require that records be retained for three years after completing activities pertaining to grant funds or until all outstanding claims have been resolved.

WHERE DO I FIND BUDGETS & AMENDMENT FORMS? www.isbe.net/21cclc Resources Budget forms for grants by cohort year, i.e., FY 07, 08, 09, 10.

PAYMENT SCHEDULES Payments are requested in months as needed, based on projected dates of expenditures. Salaries and fringe benefits are expended in equal intervals and should be projected in this manner. Supplies, materials, and contracted services should be requested in month in which the expenditure is expected.

When do activities begin? PAYMENT SCHEDULES July August September October November December January February March April May June Regular Term: July 1, 2010 thru June 30, 2011 When do activities begin?

When do activities begin? PAYMENT SCHEDULES July 10 August 10 September October November December January February March April May June July 11 August 11 Extended Term: July 1, 2010 thru August 31, 2011 When do activities begin?

COMMON PAYMENT SCHEDULES July 10 August 10 September October November December January February March April May June July 11 August 11 Total $10,000 $8,570 $8,570 $8,590 $120,000

PROPER PAYMENT SCHEDULES $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $10,000 $10,000 $ 5,000 $10,000 $10,000 $ 30,000 $10,000 $10,000 $ 10,000 $30,000 $10,000 $ 5,000 $10,000 $ 5,000 $120,000 $120,000 $120,000 July 10 August 10 September October November December January February March April May June July 11 August 11 Total Big question – when will I receive my money – well, Ernie vouchers every week, so dependant upon your payment schedule and your availability of funds (frozen?) the vouchers are sent to comptroller. Check FRIS INQUIRY to see how your program stands.

HOW FISCAL YEARS CAN OVERLAP July 10 August 10 September October November December January February March April May June July 11 August 11 Total $ 0 $10,000 $10,000 $10,000 $10,000 $ 120,000 July 10 August 10 September October November December January February March April May June July 11 August 11 Total $ 5,000 $ 2,000 $10,000 $10,000 $10,000 $ 3,000 $ 120,000

21st CENTURY GRANT PROCESS Final Payment/ Prepayment Determined July – submit your original application Initial Applications/ Revised Budgets/ Amendments Final Payment September Payment Final Expenditures Thru: 6/30 Due: 07/31 May Payment October Payment GRANT PROCESS April Payment November Payment Expenditures Thru: 12/31 Due: 01/31 December Payment March Payment Expenditures Thru: 03/31 Due: 04/30 January Payment February Payment Amendment (if applicable)

WHEN IS AN AMENDMENT NEEDED? The scope of the program changes: e.g., summer school is added. Change in a budget cell of 20% or $1000 (whichever is greater). Adding a new expenditure (opening a new cell) on the budget End date is changed (letter or e-mail will suffice on this)

EXPENDITURE REPORTS Cash management tool Transmitted electronically via IWAS Notification sent via e-mail Anything beyond the 20% variance is not accepted Failure to submit = funds frozen until report is received

GRANT EXPENDITURES Expenditure reports should always reflect cumulative expenditures. Expenditures can vary by 20% or $1,000, whichever is the greater, on a budgeted cell. Excess cash will be withheld from future scheduled payment(s). A project is FINAL when the end date equals the expenditure through date with zero obligations. If an obligation is reported, the entity will have 90 days from the end date of the project to liquidate the obligation. IWAS – Electronic Expenditure Reports See Quick Help Guide Call Help Desk to set up IWAS Admin account IF new participant, will need to complete W-9 form to establish RCDT code For the periods through December 31, through March 31 and through PED of June 30 – or – PED 8/31 DUE 30 days after the through date. IE – 1/31 for the 12/31 report.

PREVIOUS PROBLEMS Final expenditure report overstated or understated Final expenditure report NOT cumulative Sub-grant expenditures not monitored Expenditure reports do not agree with the amounts recorded in the district’s general ledger Grant funds were not segregated (i.e., federal grant funds were used to cover local operating expenditures) Itemize and describe – not being nit-picky, but this provides the ability for programmatic approvals! ISBE deals with WHOLE dollars – no cents! Don’t forget that CAP – applicable to salaries for employees w/ lots of hats, audit, etc Especially for sub-grants – as the administrative agent YOU are responsible for how they spend the money – need details – WHO ….. WHAT ….. WHEN ……WHERE…and WHY Why? b/c Feds ask us: Where are the funds budgeted? What are the plans/activities for these funds Based on these plans and budget, how are the funds actually being spent Did the plans accomplish what was intended – did you meet your goal?

ELECTRONIC SERVICES IWAS HELP DESK 217-558-3600 www.isbe.net Financial Reimbursement Information System Inquiry (FRIS) Electronic Expenditure Report System IWAS HELP DESK 217-558-3600

NAVIGATING ISBE.net

FUNDING & DISBURSEMENTS

POLICY/PROCEDURES/ REQUIREMENTS

HIGHLIGHTS Fiscal Policies/Procedures/Requirements Indirect Cost Rates Pages 16 and 17 Cost Allocation Plans Pages 18 and 19 Supplementing vs. Supplanting Page 33 www.isbe.net/funding/pdf/fiscal_procedure_handbk.pdf Indirect Cost Rates: School Districts use their individual rate. Community Groups use the statewide average of 3.03% Cost Allocation Plans – define – Time Distribution – supporting documentation and evidence of time spent within program Supplanting vs. Supplemental – if a Site Director is already on staff then grant funds can not be used to replace this position’s salary. If this grant requires extra duty/time – then grant funds can be used to supplement the time spent on these activities.

NAVIGATING ISBE.net

FRIS INQUIRY

NAVIGATING ISBE.net

ELECTRONIC EXPENDITURE REPORTS Choose “system Listings” and scroll to “reporting”

Important Notes Limitation of administrative costs Function 2300 Limited to 5% of the total budget allocation Be sure to categorize correctly Food Costs— allowed for meetings that include family members and that take place during regular mealtime hours. Maximum allowable is $10 per person Not for meals for computer classes, GED classes, etc.

BUDGET REVIEW Professional Development Funds must be included for a minimum of three state level workshops If there are no funds listed in budget, we will look for explanation in the Continuation Application as to how the PD will be paid for

Evaluation Funds must included in budget for evaluation purposes, function 2620. Internal External If no funds allocated, we will be asking for explanation.

OUT OF STATE TRAVEL 50 or more miles from Illinois’s borders No out of state travel without prior permission from ISBE Use form online at www.isbe.net/21cclc Do not schedule airfare, hotel, or any nonrefundable expenses until permission is received Travel to USDE sponsored Summer Institute does not need preapproval

NON ALLOWABLE COSTS Overnight or out of state travel for students Daily snacks/meals for students Food for professional development events, faculty, staff, or administrative meetings or for staff in any setting Clothing (materials for sewing classes are allowable)

NON ALLOWABLE COSTS Equipment Incentives of cash, clothing, or others that are unreasonable in proportion to the amount of funding Furniture Staff events that include retreats, lock-ins, or similar types of events

NON ALLOWABLE COSTS Field trips that are purely recreational Membership dues to organizations, societies Promotional or marketing items Pens, caps, totes, mugs, etc. Capital improvements or construction, remodeling, or renovation Classes for credit recovery that were previously offered and paid for by district or other funds sources Supplanting

SALARIES Payroll must be supported with time and attendance records. Salaries chargeable to more than one grant program or cost objective must be supported by appropriate time and effort (time distribution) records. People who work on multiple grants must have time pro-rated among the grants.

INDIRECT COSTS Costs incurred for common or joint objectives that cannot easily and specifically be identified with a particular grant Payroll Accounting Data processing Functions 2510, 2520, 2570, 2640 and 2660—if direct costs here, no indirect costs can be used on budgets

INDIRECT COSTS CONTINUED CBOs/FBOs use the state average—not yet determined for FY11 School districts can use the amounts in their NCLB consolidated applications (after October 1) If want to use indirect cost rate, will have to amend later Universities use 8%

1000, 100 INSTRUCTIONAL SALARIES Positions here MUST spend more than 50% of time in direct instruction of students. Must be employed by the fiscal agent Teachers Teacher aides Tutors Recreational leaders Others who may teach or lead activities

BUDGET SALARIES EXAMPLES 10 teachers (5 math, 5 reading) X $25 hr X 2 hrs/wk X 28 wks=$14,000 5 math tutors X $10/hr X 2hrs/wk/28 wks = $2800 5 recreation leaders X $15 hr X 1hr/wkX28 wk= $2100

1000, 200 - BENEFITS Paid to employees of fiscal agent Must be listed separately on grant Provide total expenses for all employees in each category--examples TRS (federal is required for teachers) in agencies that are required reporters e.g. school districts (outside CPS) and ROEs Medicare Life Insurance Medical/Health IMRF (non certified staff)

BENEFIT EXAMPLES 200 300 (Considered employers’ insurance) 10 teachers TRS = 5 tutors IMRF = 5 recreation leaders IMRF= 300 (Considered employers’ insurance) 5 Rec Leaders Workers’ comp= 5 Rec Leaders Unemployment comp=

1000, 300 - INSTRUCTIONAL PURCHASED SERVICES Workers’ comp/Unemployment comp Fees for presentations to students Consultant fees/field trip entrance fees Software license fees Salaries of those not employed by fiscal agent Teachers, tutors, etc Rec Leaders from YMCA

1000, 400 - INSTRUCTIONAL SUPPLIES & MATERIALS It is not enough to put supplies and materials and list a total amount Correct examples--supplementary reading books, folders, flip charts, art supplies, educational software No equipment is allowed, even if under $500 Incentives go here—must put what is to be given No t-shirts No cash Reasonable and feasible based on total amount of grant

2210 - IMPROVEMENT OF INSTRUCTION 100 - Stipends for those attending professional development outside regular work hours 100 - Substitute teachers (if PD held during regular work hours) 200 - Benefits on stipends, sub pay 300 - Fees for conferences, per diem, hotel expenses, consultant fees 400 - Books and journals for those attending professional development training

2230 - ASSESSMENT & TESTING 100 - Salary paid specifically for someone who performs testing 200 - Benefits on salary (always list separately) 300 - Unemployment or workers‘ comp 400 - ACT test prep materials, pre-post tests

2300 - ADMINISTRATVE COSTS Limited to 5% of total budget For salaries to be here, they must be for administrative positions, e.g. project director, grants coordinator—someone who is considered an administrator by agency or school district No teaching salaries or site coordinators Limited to 5% of total budget

GENERAL ADMINISTRATION 100 - Project director -.25 FTE = $15,000 Project coordinator - .5 FTE = $15,000 200 - Benefits for these positions (list) 300 - Workers comp, unemployment com, postage, travel costs between projects, audit (prorated) 400 – Supplies - general office supplies such as folders, ink cartridges, etc.

2520 - FISCAL SERVICES 100 - Bookkeeper - 100 hours X $12 hr =$1200 200 - Associated benefits – delineate 300 - Workers and/or unemployment comp 300 - contacted fiscal services 400 - Bookkeeping supplies - ledgers, file folders, ink cartridges - $500

2540 - OPERATIONS & MAINTENANCE 100 - Janitor salary for cleaning after school areas beyond regular hours of job 200 - Associated benefits (list) 300 - Workers’ comp; prorated rent for use of building after school (usually CBO/FBO) 400 - General cleaning supplies NO RENT/MORTGAGE payment on buildings owned or occupied by grantee

2550 - TRANSPORTATION 100 - Bus drivers’ salaries 200 - Benefits—list each out separately 300 - Benefits for own workers or *Contractual bus service 150 days at $200 per day= $30,000 400 - Gas, oil = $4000 (if grantee is paying; usually included in a contract)

2560 - FOOD SERVICES 100—Cafeteria workers salaries to serve snacks 2 workersX$10/hrX5hrs/wkX 28wks=$2800 200—IMRF, insurance 300—Workers’ compensation For snacks/food programs see Nutrition website, www.isbe.net/nutrition

2620 - PLANNING, RESEARCH & EVALUATION 100--if employees internally do this 2 employees X 100 hours X $50/hr =$10,000 200 and/or 300 – benefits - list 300 - contractual for evaluation if this is paid to a public entity, it goes in 4000, 300

2900 - SUPPORT SERVICES Site Coordinators Salaries go here 100 - Salaries .4FTE = $15,000 or if hourly provide as in other examples 200 – benefits - list each separately with percents that apply and total 300 - if applies 400 - General office supplies = file folders, ink cartridges, paper, markers

3000 - COMMUNITY SERVICES All payments related to parents go here 100 - salaries paid for adult education by employees of fiscal agent; parent liaison 200/300 – Benefits - list 300 - Contractual for programs for adults Drug awareness counselor Museum program 400 – Supplies - art and craft supplies, books on parenting, take home reading kits. Food for parent nights—2 events X 100 people X$10 = $2000

COMMON ERRORS Not enough detail Using zeroes, decimals, etc. Not working on payment schedule to schedule payments when really needed (leads to excess cash on hand) Not putting wc/uc in Object 300 Not delineating supplies Categorizing workers’ salaries in wrong place 2210 - salary here cannot be for time with student contact

MORE COMMON ERRORS 4000, 300 - not putting payments to government entities, LEAs here regardless of service provided Not having original signatures on budgets and grant agreements Forgetting to mail hard copy after faxing budgets Not establishing the proper end date Not submitting an original budget because believing continuation means automatic renewal Not keeping copies of the final approved budget which may have changes made by ISBE

AUDITING Auditors presume supplanting unless you have records to prove otherwise Nothing paid in previous year with state, private, or local funds (unless that fund source changed)

RESOURCES www.isbe.net/funding/pdf/fiscal_procedure_handbk.pdf Fiscal Policies and Procedures Handbook www.isbe.net/21ccc Budget Amendment forms Continuation Applications Out of State Travel Forms

FUNDING & DISBURSEMENT SERVICES DIVISION ADMINISTRATOR: TIM IMLER SUPERVISOR: MARY MORRISON (State/Federal Grants) FISCAL CONSULTANTS: KIM LEWIS & SALLY CRAY EXPENDITURE REPORTS: ERNIE BARROW DIVISION PHONE NUMBER: 217.782.5256 E-mail Addresses: timler@isbe.net bmorriso@isbe.net klewis@isbe.net scray@isbe.net ebarrow@isbe.net

INNOVATION AND IMPROVEMENT DIVISION Division Administrator—217/524-4832 Monique Chism mchism@isbe.net Division Supervisor Marci Johnson marjohns@isbe.net Springfield Consultants Gail Meisner gmeisner@isbe.net Gary Miller gmiller@isbe.net Support Staff Pam Bokamp pbokamp@isbe.net

QUESTIONS?