21ST Century Community Learning Centers Program Income Training June 21, 2019 Connecticut State Department of Education

Agenda Introductions What is Program Income? Generating Program Income Parent Fee Application Process Generated Program Income Requirements Timeline for Expenditure of Generated Program Income Questions

What is Program Income? Program Income is the gross income earned by a grantee that is directly generated by a supported activity or earned as a result of the Federal award during the period of performance. A simple definition of program income is -- revenue generated as a direct result of the Federal award and that is in addition to the Federal funds provided by the State through its competitive application process. Program Income generated without prior written approval from the CT State Department of Education (CSDE) must be deducted from the funds awarded under the Federal grant.

Example of Generating Program Income - Using 21st CCLC funds A 21st CCLC program would like to sell popcorn at after school events and re-invest the proceeds into its program. If 21st CCLC program funds were used to purchase the popcorn and other materials, then the revenue generated would be considered program income. The CSDE must give prior written approval to the grantee for the program to generate and re-invest program income into its program. IF prior approval is given to a grantee, the CSDE will be very clear that program income may only be used for authorized/approved activities. The grantee must be clear in its request to the CSDE as to the purpose of generated income. Monies generated from the sale of popcorn at 21st CCLC events will be used towards the enrollment of additional students into the program.

Example of Generating Program Income - Using Other Funds A 21st CCLC program has a car wash and spends $20.00 of the CBO’s funds on supplies and by the end of the day they’ve earned $200.00 dollars. The program would deduct the $20.00 of supplies costs from the gross income of $200.00 earned to see that they have earned $180.00 of program income. The $180.00 generated from the car wash will be used towards the enrollment of additional students into the program.

Generating Program Income - Entertainment costs Federal funds generally should not be used for entertainment; this includes spending program funds and program income on items such as non-educational field trips, purchasing gift cards, giving incentive awards, etc. Specific costs that might otherwise be considered entertainment that have a programmatic purpose and are authorized in the approved budget are allowable. Using program income to “recognize” students, staff or volunteers would be unallowable.

Generating Program Income - Parent Fees The 21st CCLC program statute does not specifically prohibit the collection of parent fees. For grantees that collect parent fees, they should understand that the income generated by the fees is considered program income. Per federal guidance, all fees must be NOMINAL. Nominal means: very small; far below the real value or cost. NO student can be excluded from the program regardless of ability to pay. A parent does not have to provide verification of financial status; they simply can state they are unable to pay. Per federal guidance, all low income students should be enrolled first with no expectation of them paying a fee; if there is space remaining, then the program can be opened to students who are able to pay, utilizing a Sliding Fee Scale.

Generating Program Income - Parent Fees A grantee charges a nominal fee for parents of students in its after school program and does not request written prior approval from the CSDE prior to collecting the parent fees. The parent fees are program income. Without written prior approval from the CSDE, the program income would need to be deducted from the amount of funds awarded the grantee.

Generating Program Income - Parent Fees Application Opens: June 24, 2019 Final Due Date for Applications: August 9, 2019 Upon application approval, any income that is generated over this summer must comply with the federal guidance related to program income. In the future, if income is generated prior to CSDE approval, it will be deducted from the grantees award.

Generating Program Income - Parent Fees Parent Fee Structure Approval Process Programs will be required to apply for approval and describe: The need for program fee income How program fee income will supplement the cost of the 21st CCLC program Acceptance of using the USDA Child Nutrition income eligibility guidelines to determine where families are for free/reduced lunch benefits What the nominal fee will be for families not eligible for free/reduced lunch How the program will determine the nominal fees The process of nominal fee structure Free/Reduced Lunch demographics of after school program

Generating Program Income Income and Expenditure Guidance Program income may only be used in the following ways: Spent within the fiscal year that the fee is generated. Spent only on sites identified in the approved grant application. Fees can only supplement and NOT supplant, which means adding program time and activities (vacation club, educational field trips, etc.), that support additional students outside of the approved grant application.

Generating Program Income Program Income Fees The generation of program income must NOT be a barrier to the most vulnerable population of participants. The CSDE will approve individual program income processes on a yearly basis. Additional fiscal monitoring, including preparation of documentation, will be required of the program. When charging parent fees, the after school student population must mirror the free/reduced lunch demographics of the schools they are serving. - Example: If the school being served has 50% of its students eligible to receive free/reduced lunch, the 21ST CCLC program must also serve 50% of students that qualify for free/reduced lunch. If the school utilizes the provision that all students receive free/reduced lunch, it is required that program participants reflect the actual school demographics.

Applicant Approval Requirements Requirements of Program Upon Application Approval If the Program Income Application is approved, it will be the responsibility of the grantee to provide the following documentation to the CSDE: Projected Program Income Budget at the start of the year. A separate account for generated program fee income. Program income expenditure report three times a year.

Applicant Approval Requirements Program Income Approval For programs that have been granted approval to generate program income, the grantee will be required to: Have standard language (provided by CSDE) on all marketing and communication materials (website, flyers, registration form, etc.) that states no student or family will be turned away for ANY reason due to the inability to pay. Eliminate financial barriers to the registration process. Example: having to provide a credit card to continue an online registration. Provide waivers and exemptions for any students/families that states they are unable to pay as determined by a family (without requiring a family to provide documentation of financial status).

Generated Program Income Generated Income outside of Program Registration and/or Fees Any program that receives federal 21st CCLC funding is required to follow federal guidance regarding program income. Generated program income must also adhere to federal guidance regarding program income. This includes monies being spent in the fiscal year in which they are generated.

Additional Funding Sources Combining 21st CCLC funding with other funding sources (United Way, Hartford Foundation for Public Giving, State-funded Extended School Hours grant, etc.) is allowable, as long as the additional funding sources supplement and not supplant 21st CCLC funds.

Timeline for Expenditure of Generated Program Income The 21st CCLC fiscal timeline is July 1 – September 30. This fifteen month cycle allows for programs to use funding from two overlapping budgets during July, August and September. This occurs only in Years 2 – 4 of the grant cycle. During this time period, programs will have access to budgets from two overlapping fiscal years. Program income must have separate accounts and be aligned to one of the two aforementioned fiscal years. Separate accounting must occur to ensure funds are spend in the appropriate fiscal year. - Example: Registration fees collected before July 1 must be spent by September 30.

Questions & Open Forum For additional information or questions regarding program income, please contact: Shelby R. Pons, 21st CCLC State Program Director Connecticut State Department of Education 860-807-2103 shelby.pons@ct.gov