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Fiscal 130: Federal Funds Policies and Procedures

This document sets forth the policies and procedures used by the Manchester School District to administer federal funds.  Notwithstanding any other policy of the District, all funds awarded directly or indirectly through any Federal grant or subsidy programs shall be administered in accordance with these policies, and any administrative procedures adopted implementing these policies. 

This document contains the internal controls and grant management standards used by the District to ensure that all federal funds are lawfully expended.  It describes in detail the District’s financial management system, including cash management procedures, procurement policies; inventory management protocols; procedures for determining the allowability of expenditures; time and effort reporting; conflict of interest, travel reimbursement, record retention; and sub-recipient monitoring responsibilities.

The Board accepts federal funds, which are available, provided that there is a specific need for them and that the required matching funds are available. The Board intends to administer federal grant awards efficiently, effectively and in compliance with all requirements imposed by law, the awarding agency and the New Hampshire Department of Education (NHDOE) or other applicable pass-through entity.

These policies establish the minimum standards regarding internal controls and grant management to be used by the District in the administration of any funds received by the District through Federal grant programs as required by applicable NH and Federal laws or regulations, including, without limitation, the Uniform Grant Guidance (UGG).

The Board directs the Superintendent or his/her designee to develop, monitor, and enforce effective administrative procedures and other internal controls over federal awards as necessary in order to provide reasonable assurances that the District is managing the awards in compliance with all requirements for federal grants and awards. Systems and controls must meet all requirements of federal and/or law and regulation and shall be based on best practices.

The Superintendent is directed to assure that all individuals responsible for the administration of a federal grant or award shall be provided sufficient training to carry out their duties in accordance with all applicable requirements for the federal grant or award in this policy.

To the extent not covered by these policies, the administrative procedures and internal controls must provide for:

1. identification of all federal funds received and expended and their program source;

2. accurate, current, and complete disclosure of financial data in accordance with federal requirements;

3. records sufficient to track the receipt and use of funds;

4. effective control and accountability over assets to assure they are used only for authorized purposes and

5. comparison of expenditures against budget. 

Grant Award Procedure

The Manchester School District utilizes Tyler Technology’s Munis financial reporting system.  Munis is the primary system for purchasing, payroll and accounting. Fixed assets are managed by the Federal Projects department in conjunction with the District Accounting Supervisor.

Once a grant award notice is received by the district and approved by the Board of School Committee, the Senior Accountant will assign the appropriate account codes in MUNIS and provide the Grant Manager the account information. A copy of the grant award notice is obtained by the Senior Accountant. In compliance with 2 C.F.R. 200.302, the district must track the CFDA title and number, federal award identification number and year, name of the federal agency, and, if applicable, name of the pass-through entity. This information is retained in a separate file for each grant. All grant expenditures must be within the dates of the grant award (start and end dates). Budgeted amounts must match the current grant award notice. If an amendment is approved, the Senior Accountant will update project files upon approval of the grant award notice.

Review and Approval of Grant

Once a grant opportunity has been identified, the Federal Projects Director develops a budget.    Grant funds are intended to supplement the Manchester School District general fund.  Therefore, when possible, it is critical that the grant application be developed in conjunction with the annual budget.  Grant managers should make use of existing furniture, equipment and supplies rather than purchasing new items. 

Salary and benefit information shall be discussed and reviewed with the Chief Financial Officer (CFO) and Human Resources Department when preparing the application.   The application for the grant shall be sent to the Superintendent with the following information:

1. Source of funds;

2. Purpose of grant;

3. Identification of grant manager;

4. Timeline for application and approval;

5. Match requirements, if applicable;

6. Potential amount and length of funds and;

7. Amount of award

Grant applications are to be submitted to the Superintendent for budget and content approval.  The Superintendent reviews, approves and submits the application to the New Hampshire Department of Education (NHDOE) for approval.   If the grant impacts another department, the grant applicant is required to have a discussion with key stakeholders. For instance, if an application could result in technology purchases, the Chief Information & Cyber Security Officer would be involved in the planning process.  All grants are submitted to the Finance & Facilities Committee with final approval by the Board of School Committee.

Grant Award Notice

After the Grant is approved by NHDOE, the Senior Accountant prints the award and establishes a project code to identify costs.  A budget sheet is completed. The Senior Accountant works with the Project Director on needed revisions. 

Budget Control

The Senior Accountant reviews and maintains the financial expenditures of each grant throughout its life cycle, by comparing and analyzing actual expenditures to budgets.  The Senior Accountant runs expenditures reports for all grants on a monthly basis.  The year to date (YTD) budget reports/flexible spending reports are used to assess the financial status of the grant, request reimbursement, and determine if revisions are needed.  The monthly reports are forwarded to the grant managers.  If significant variances exist, or a trend may lead to a significant variance, the Project Director and Assistant Business Administrator are notified.  The Project Director and Senior Accountant will determine if an amendment is appropriate. Actual expenditures or outlays must be compared with budgeted amounts for each federal award. 

Accounting Records

Accounting records are kept in hard copy. Financial reports are also maintained in the Munis system. The Business Office is responsible for the maintenance of all purchase orders and related accounting records in conformance with the Municipal Records Retention Schedule.

The Senior Accountant completes monthly reimbursement reports through the NHDOE Single Sign On (SOS) system.  Authorization for use of the SOS is obtained by NHDOE.   The Senior Accountant generates project reports each month for reimbursement.  The Senior Accountant is responsible to adhering to the project dates and ensuring the final report is completed by the 45th day after the grant end date.  Reconciliation of the general ledger by project is completed monthly by the District Accountant. Journal entries are completed monthly for workers compensation and indirect costs for each grant that is authorized for such expenditures.  The Senior Accountant maintains spreadsheets for budget vs actual expenses, cumulative monthly expenses by project and proof of monthly reporting.   Budget variances are reviewed with the Project Director as needed. The monthly reports are submitted to the NHDOE for approval by the Superintendent.

The Chart of Accounts for grants is set up so that the expenses are tracked by project, fiscal year and source of funds.  For more detailed use of the chart of accounts, please see the NHDOE Federal Funds Handbook.

Types of Expenses:

• Personnel/Payroll/Benefits:  Object: 50110 – 50260 

• Contracted Services:  Object: 50300 -50352

• Rental/Lease/Utilities/Travel/Supplies/Books:  Object 50400 – 50649

• Equipment/Computers:  Objects 50731 – 50750

• Indirect Cost:  Object 50930

Spending Grant Funds /Period of Performance

The Senior Accountant is responsible for reporting all expenses to the applicable agency for reimbursement.  Federal projects personnel, accounts payable personnel and the district accountant work in conjunction to ensure active purchase orders are paid and/or liquidated before the final report is completed.  Final reports of expenditures are completed within 45 days after the grant end date as shown on the award notice.  Reconciliation of expenses is the responsibility of the district accountant.

For both State-administered and direct grants, regardless of the period of availability, the District shall liquidate all obligations incurred under the award not later than forty-five (45) days after the end of the funding period unless an extension is authorized. Any funds not obligated within the period of performance or liquidated within the appropriate timeframe are said to lapse and shall be returned to the awarding agency. Consistently, the District shall closely monitor grant spending throughout the grant cycle.  

DAF-1 - ALLOWABILITY

The Superintendent is responsible for the efficient and effective administration of grant funds through the application of sound management practices. Such funds shall be administered in a manner consistent with all applicable Federal, State and local laws, the associated agreements/assurances, program objectives and the specific terms and conditions of the grant award.

A.            Cost Principles

Except whether otherwise authorized by statute, costs shall meet the following general criteria in order to be allowable under Federal awards:

1.  Be “necessary” and “reasonable” for proper and efficient performance and administration of the Federal award and be allocable thereto under these principles.

a.  To determine whether a cost is “reasonable”, consideration shall be given to:

i.  whether a cost is a type generally recognized as ordinary and necessary for the operation of the District or the proper and efficient performance of the Federal award;

ii.  the restraints or requirements imposed by such factors as sound business practices, arm’s length bargaining, Federal, State, local, tribal and other laws and regulations;

iii.  market prices for comparable goods or services for the geographic area;

iv.  whether the individuals concerned acted with prudence in the circumstances considering their responsibilities; and

v.  whether the cost represents any significant deviation from the established practices or Board policy which may increase the expense. While Federal regulations do not provide specific descriptions of what satisfied the “necessary” element beyond its inclusion in the reasonableness analysis above, whether a cost is necessary is determined based on the needs of the program. Specifically, the expenditure must be necessary to achieve an important program objective. A key aspect in determining whether a cost is necessary is whether the District can demonstrate that the cost addresses an existing need and can prove it.

b.  When determining whether a cost is “necessary”, consideration may be given to whether:

i.  the cost is needed for the proper and efficient performance of the grant program;

ii.  the cost is identified in the approved budget or application;

iii.  there is an educational benefit associated with the cost;

iv.  the cost aligns with identified needs based on results and findings from a needs assessment; and/or

v.  the cost addresses program goals and objectives and is based on program data.

c.  A cost is allocable to the Federal award if the goods or services involved are chargeable or assignable to the Federal award in accordance with the relative benefit received.

2.  Conform to any limitations or exclusions set forth as cost principles in Part 200 or in the terms and conditions of the Federal award.

3.  Be consistent with policies and procedures that apply uniformly to both Federally-financed and other activities of the District.

4.  Be afforded consistent treatment. A cost cannot be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been assigned as an indirect cost under another award.

5.  Be determined in accordance with generally accepted accounting principles.

6.  Be representative of actual cost, net of all applicable credits or offsets.

The term “applicable credits” refers to those receipts or reductions of expenditures that operate to offset or reduce expense items allocable to the Federal award. Typical examples of such transactions are: purchase discounts; rebates or allowances; recoveries or indemnities on losses; and adjustments of overpayments or erroneous charges. To the extent that such credits accruing to/or received by the State relate to the Federal award, they shall be credited to the Federal award, either as a cost reduction or a cash refund, as appropriate.

7.  Be not included as a match or cost-share, unless the specific Federal program authorizes Federal costs to be treated as such.

8.  Be adequately documented:

a.  in the case of personal services, the Superintendent shall implement a system for District personnel to account for time and efforts expended on grant funded programs to assure that only permissible personnel expenses are allocated;

b.  in the case of other costs, all receipts and other invoice materials shall be retained, along with any documentation identifying the need and purpose for such expenditure if not otherwise clear.

 B. Selected Items of Cost

The District shall follow the rules for selected items of cost at 2 C.F.R. Part 200, Subpart E when charging these specific expenditures to a Federal grant. When applicable, District staff shall check costs against the selected items of cost requirements to ensure the cost is allowable. In addition, State, District and program-specific rules, including the terms and conditions of the award, may deem a cost as unallowable and District personnel shall follow those rules as well.

C. Cost Compliance

 The Superintendent shall require that grant program funds are expended and are accounted for consistent with the requirements of the specific program and as identified in the grant application. Compliance monitoring includes accounting for direct or indirect costs and reporting them as permitted or required by each grant.

D.  Determining Whether A Cost is Direct or Indirect

1.  “Direct costs” are those costs that can be identified specifically with a particular final cost objective, such as a Federal award, or other internally or externally funded activity, or that can be directly assigned to such activities relatively easily with a high degree of accuracy.

These costs may include: salaries and fringe benefits of employees working directly on a grant-funded project; purchased services contracted for performance under the grant; travel of employees working directly on a grant-funded project; materials, supplies, and equipment purchased for use on a specific grant; and infrastructure costs directly attributable to the program (such as long distance telephone calls specific to the program, etc.).

2.  “Indirect costs” are those that have been incurred for a common or joint purpose benefitting more than one (1) cost objective, and not readily assignable to the cost objectives specifically benefitted, without effort disproportionate to the results achieved. Costs incurred for the same purpose in like circumstances shall be treated consistently as either direct or indirect costs.

These costs may include: general data processing, human resources, utility costs, maintenance, accounting, etc.

Federal education programs with supplement not supplant provisions must use a restricted indirect cost rate. In a restricted rate, indirect costs are limited to general management costs. General management costs do not include divisional administration that is limited to one (1) component of the District, the governing body of the District, compensation of the Superintendent, compensation of the chief executive officer of any component of the District, and operation of the immediate offices of these officers.

The salaries of administrative and clerical staff should normally be treated as indirect costs. Direct charging of these costs may be appropriate only if all the following conditions are met:

a.  Administrative or clerical services are integral to a project or activity.

b.  Individuals involved can be specifically identified with the project or activity.

c.  Such costs are explicitly included in the budget or have the prior written approval of the Federal awarding agency.

d.  The costs are not also recovered as indirect costs.

Where a Federal program has a specific cap on the percentage of administrative costs that may be charged to a grant, that cap shall include all direct administrative charges as well as any recovered indirect charges.

Effort should be given to identify costs as direct costs whenever practical, but allocation of indirect costs may be used where not prohibited and where indirect cost allocation is approved ahead of time by NHDOE or the pass-through entity (Federal funds subject to 2 C.F.R Part 200 pertaining to determining indirect cost allocation). 

E.  Timely Obligation of Funds

Obligations are orders placed for property and services, contracts and subawards made, and similar transactions during a given period that require payment by the non-Federal entity during the same or a future period.

The following are examples of when funds are determined to be “obligated” under applicable regulation of the U.S. Department of Education:

When the obligation is for:

1. Acquisition of property – on the date which the District makes a binding written commitment to acquire the property.

2. Personal services by an employee of the District – when the services are performed.

3. Personal services by a contractor who is not an employee of the District – on the date which the District makes a binding written commitment to obtain the services.

4. Public utility services – when the District received the services.

5. Travel – when the travel is taken.

6. Rental of property – when the District uses the property.

7. A pre-agreement cost that was properly approved by the Secretary under the cost principles in 2 C.F.R. Part 200, Subpart E – Cost Principles – on the first day of the project period.

F.  Period of Performance

All obligations must occur on or between the beginning and ending dates of the grant project. This period of time is known as the period of performance. The period of performance is dictated by statute and will be indicated in the Grant Award Notification (“GAN”). As a general rule, State-administered Federal funds are available for obligation within the year that Congress appropriates the funds for. However, given the unique nature of educational institutions, for many Federal education grants, the period of performance is twenty-seven (27) months. This maximum period includes a fifteen (15) month period of initial availability, plus a twelve (12) month period of carry over. For direct grants, the period of performance is generally identified in the GAN.

In the case of a State-administered grant, obligations under a grant may not be made until the grant funding period begins or all necessary materials are submitted to the granting agency, whichever is later. In the case of a direct grant, obligations may begin when the grant is substantially approved, unless an agreement exists with NHDOE or the pass-through entity to reimburse for pre-approval expenses.

For both State-administered and direct grants, regardless of the period of availability, the District shall liquidate all obligations incurred under the award not later than forty-five (45) days after the end of the funding period unless an extension is authorized. Any funds not obligated within the period of performance or liquidated within the appropriate timeframe are said to lapse and shall be returned to the awarding agency. Consistently, the District shall closely monitor grant spending throughout the grant cycle.

DAF-2 - CASH MANAGEMENT AND FUND CONTROL

Payment methods must be established in writing that minimize the time elapsed between the drawdown of federal funds and the disbursement of those funds. Standards for funds control and accountability must be met as required by the Uniform Guidance for advance payments and in accordance with the requirements of NHDOE or other applicable pass-through-entity.

In order to provide reasonable assurance that all assets, including Federal, State, and local funds, are safeguarded against waste, loss, unauthorized use, or misappropriation, the Superintendent shall implement internal controls in the area of cash management.

The District’s payment methods shall minimize the time elapsing between the transfer of funds from the United States Treasury or the NHDOE (pass-through entity) and disbursement by the District, regardless of whether the payment is made by electronic fund transfer, or issuance or redemption of checks, warrants, or payment by other means.

The District shall use forms and procedures required by the NHDOE, grantor agency or other pass-through entity to request payment. The District shall request grant fund payments in accordance with the provisions of the grant. Additionally, the District’s financial management systems shall meet the standards for fund control and accountability as established by the awarding agency.

The Superintendent is authorized to submit requests for advance payments and reimbursements at least monthly when electronic fund transfers are not used, and as often as deemed appropriate when electronic transfers are used, in accordance with the provisions of the Electronic Fund Transfer Act (15 U.S.C. 1693-1693r).

When the District uses a cash advance payment method, the following standards shall apply:

A.  The timing and amount of the advance payment requested will be as close as is administratively feasible to the actual disbursement for direct program or project costs and the proportionate share of any allowable indirect costs.

B.  The District shall make timely payment to contractors in accordance with contract provisions.

C.  To the extent available, the District shall disburse funds available from program income (including repayments to a revolving fund), rebates, refunds, contract settlements, audit recoveries, and interest earned on such funds before requesting additional cash payments.

D. The District shall account for the receipt, obligation and expenditure of funds.

E.  Advance payments shall be deposited and maintained in insured accounts whenever possible.

F.  Advance payments will be maintained in interest bearing accounts unless the following apply:

1.  The District receives less than $120,000 in Federal awards per year.

2.  The best reasonably available interest-bearing account would not be expected to earn interest in excess of $500 per year on Federal cash balances.

3.  The depository would require an average or minimum balance so high that it would not be feasible within the expected Federal and non-Federal cash resources.

4.  A foreign government or banking system prohibits or precludes interest bearing accounts.

G.  Pursuant to Federal law and regulations, the District may retain interest earned in an amount up to $500 per year for administrative costs. Any additional interest earned on Federal advance payments deposited in interest-bearing accounts must be remitted annually to the Department of Health and Human Services Payment Management System (“PMS”) through an electronic medium using either Automated Clearing House (“ACH”) network or a Fedwire Funds Service payment. Remittances shall include pertinent information of the payee and nature of payment in the memo area (often referred to as “addenda records” by Financial Institutions) as that will assist in the timely posting of interest earned on Federal funds.

Payment Methods

The funds are transferred via ACH to the district checking account.  Upon receipt, the District Accountant verifies the amounts and completes journal entries to the appropriate projects.  Reconciliation of the awards is completed monthly as well as year-end prior to the annual audit. 

The District must liquidate all obligations incurred under the award not later than 45 days after the end of funding period unless an extension is authorized.  Any funds not obligated within the period of availability or liquidated within the appropriate timeframe are said to lapse and must be returned to the awarding agency. 

Carryover

Certain State Administered Grants permit recipients to “carryover” any funds left over at the end of the initial 15 month period into the next year.  These leftover funds are typically referred to as carryover funds and continue to be available for an additional 12 months 34 C.F.R. 76.709.  Accordingly, the District may have multiple years of grant funds available under the same program at the same time. 

DAF-3 - PROCUREMENT

All purchases for property and services made using federal funds must be conducted in accordance with all applicable Federal, State and local laws and regulations, the Uniform Guidance, and the District’s written policies and procedures. 

Procurement of all supplies, materials equipment, and services paid for from Federal funds or District matching funds shall be made in accordance with all applicable Federal, State, and local statutes and/or regulations, the terms and conditions of the Federal grant, District policies, and procedures.

The Superintendent shall maintain a procurement and contract administration system in accordance with the USDOE requirements (2 CFR 200.317-.326) for the administration and management of Federal grants and Federally-funded programs. The District shall maintain a contract administration system that requires contractors to perform in accordance with the terms, conditions, and specifications of their contracts or purchase orders. Except as otherwise noted, procurement transactions shall also conform to the provisions of the District’s documented general purchase Policy.

The District avoids situations that unnecessarily restrict competition and avoids acquisition of unnecessary or duplicative items. Individuals or organizations that develop or draft specifications, requirements, statements of work, and/or invitations for bids, requests for proposals, or invitations to negotiate, are excluded from competing for such purchases. Additionally, consideration shall be given to consolidating or breaking out procurements to obtain a more economical purchase. And, where appropriate, an analysis shall be made to lease versus purchase alternatives, and any other appropriate analysis to determine the most economical approach. These considerations are given as part of the process to determine the allowability of each purchase made with Federal funds.

Contracts are awarded only to responsible contractors possessing the ability to perform successfully under the terms and conditions of a proposed procurement. Consideration is given to such matters as contractor integrity, compliance with public policy, record of past performance, and financial and technical resources. No contract is awarded to a contractor who is suspended or debarred from eligibility for participation in federal assistance programs or activities.

Purchasing records are sufficiently maintained to detail the history of all procurements and must include at least the rationale for the method of procurement, selection of contract type, and contractor selection or rejection; the basis for the contract price; and verification that the contractor is not suspended or debarred.

To foster greater economy and efficiency, the District may enter into State and local intergovernmental agreements where appropriate for procurement or use of common or shared goods and services.

A.  Competition All procurement transactions shall be conducted in a manner that encourages full and open competition and that is in accordance with good administrative practice and sound business judgement. In order to promote objective contractor performance and eliminate unfair competitive advantage, the District shall exclude any contractor that has developed or drafted specifications, requirements, statements of work, or invitations for bids or requests for proposals from competition for such procurements.

Some of the situations considered to be restrictive of competition include, but are not limited to, the following:

1.  unreasonable requirements on firms in order for them to qualify to do business;

2.  unnecessary experience and excessive bonding requirements;

3.  noncompetitive contracts to consultants that are on retainer contracts;

4.  organizational conflicts of interest;

5.  specification of only a “brand name” product instead of allowing for an “or equal” product to be offered and describing the performance or other relevant requirements of the procurement; and/or

6.  any arbitrary action in the procurement process.

Further, the District does not use statutorily or administratively imposed State, local, or tribal geographical preferences in the evaluation of bids or proposals, unless (1) an applicable Federal statute expressly mandates or encourages a geographic preference; (2) the District is contracting for architectural and engineering services, in which case geographic location may be a selection criterion provided its application leaves an appropriate number of qualified firms, given the nature and size of the project, to compete for the contract.

To the extent that the District uses a pre-qualified list of persons, firms or products to acquire goods and services, the pre-qualified list must include enough qualified sources as to ensure maximum open and free competition. The District allows vendors to apply for consideration to be placed on the list as requested.

B.  Solicitation Language The District shall require that all solicitations incorporate a clear and accurate description of the technical requirements for the material, product, or service to be procured. Such description shall not, in competitive procurements, contain features which unduly restrict competition. The description may include a statement of the qualitative nature of the material, product or service to be procured and, when necessary, shall set forth those minimum essential characteristics and standards to which it shall conform if it is to satisfy its intended use. Detailed product specifications should be avoided if at all possible.

When it is impractical or uneconomical to make a clear and accurate description of the technical requirements, a “brand name or equivalent” description may be used as a means to define the performance or other salient requirements of procurement. The specific features of the named brand which shall be met by offers shall be clearly stated; and identify all requirements which the offerors shall fulfill and all other factors to be used in evaluating bids or proposals.

The Board will not approve any expenditure for an unauthorized purchase or contract.

C.  Procurement Methods (See Fiscal 119)

All contracts for, and purchases of supplies, materials, and equipment in the amount of $50,000 or more, and contractual services in the amount of $50,000 or more, shall be based, when feasible, on at least three competitive bids.  

When bidding procedures are used, bids shall be advertised appropriately. Suppliers shall be invited to have their names placed on mailing lists to receive invitations to bid. When specifications are prepared, they will be sent to all merchants and firms who have indicated an interest in bidding.

All bids must be submitted in sealed envelopes, addressed to the business office or address designated by the business office, and plainly marked with the name of the bid and the time of the bid opening. Bids shall be opened at the time specified.  If noted within the bid, all bidders and other persons shall be invited to be present. The Superintendent or his/her designee shall record the results of the bids and the time of opening.

The district anticipates awarding one contract but reserves the right to select more than one vendor where it deems it is in their best interest to do so.  The Superintendent or his/her designee shall be granted permission to negotiate with vendors after bids are opened to secure the best option for the district.

The Board reserves the right to reject any or all bids and to accept that bid which appears to be in the best interest of the District.  The Board reserves the right to waive any formalities in,or reject any or all bids or any part of any bid. The School District also reserves the right to abandon the project or to solicit and re-advertise for other proposals.  Any bid may be withdrawn prior to the scheduled time for the opening of bids.  Any bid received after the time and date specified shall not be considered. The Board need not accept the lowest qualified bidder.

The bidder to whom the award is made shall be required to enter into a written contract with the District. 

 The District shall utilize the following methods of procurement:

1.  Micro-purchases

Procurement by micro-purchase is the acquisition of supplies or services, the aggregate dollar amount of which does not exceed $10,000. To the extent practicable, the District shall distribute micro-purchase equitably among qualified suppliers. Micro-purchases may be made without soliciting competitive quotations if the Superintendent considers the price to be reasonable. The District maintains evidence of this reasonableness in the records of all purchases made by this method.

2.  Small Purchases (Simplified Acquisition)

Small purchase procedures provide for relatively simple and informal procurement methods for securing services, supplies, and other property that does not exceed the competitive bid threshold of $$50,000. Small purchase procedures require that price or rate quotations shall be obtained from an adequate number of qualified sources.

3. Sealed Bids

Sealed, competitive bids shall be obtained when the purchase of, and contract for, single items of supplies, materials, or equipment which amounts to $50,000 or contractual services which amount to $50,000.

a.  In order for sealed bidding to be feasible, the following conditions shall be present:

i.  a complete, adequate, and realistic specification or purchase description is available;

ii.  two (2) or more responsible bidders are willing and able to compete effectively for the business; and

iii.  the procurement lends itself to a firm faxed price contract and the selection of the successful bidder can be made principally on the basis of price.

b.  When sealed bids are used, the following requirements apply:

i.  Bids shall be solicited in accordance with the provisions of State law.   Bids shall be solicited from an adequate number of qualified suppliers, providing sufficient response time prior to the date set for the opening of bids. The invitation to bid shall be publicly advertised.

ii.  The invitation for bids will include product/contract specifications and pertinent attachments and shall define the items and/or services required in order for the bidder to properly respond.

iii.  All bids will be opened at the time and place prescribed in the invitation for bids; bids will be opened publicly.

iv.  A firm fixed price contract award will be made in writing to the lowest responsive and responsible bidder. Where specified in bidding documents, factors such as discounts, transportation cost, and life cycle costs shall be considered in determining which bid is lowest. Payment discounts may only be used to determine the low bid when prior experience indicates that such discounts are usually taken.

v.  The Board reserves the right to reject any and all bids for sound documented reason.  

vi.  Bid protests shall be handled pursuant to the process set forth in DAF-3.I. 

4.  Competitive Proposals

Procurement by competitive proposal, normally conducted with more than one sources submitting an offer, is generally used when conditions are not appropriate for the use of sealed bids or in the case of a recognized exception to the sealed bid method.

If this method is used, the following requirements apply:

a.  Requests for proposals shall be publicized and identify all evaluation factors and their relative importance. Any response to the publicized requests for proposals shall be considered to the maximum extent practical.

b.  Proposals shall be solicited from an adequate number of sources.

c.  The District shall use its written method for conducting technical evaluations of the proposals received and for selecting recipients.

d.  Contracts shall be awarded to the responsible firm whose proposal is most advantageous to     the program, with price and other factors considered.

The District may use competitive proposal procedures for qualifications-based procurement of architectural/engineering (A/E) professional services whereby competitors’ qualifications are evaluated, and the most qualified competitor is selected, subject to negotiation of fair and reasonable compensation. The method, where price is not used as a selection factor, can only be used in procurement of A/E professional services. It cannot be used to purchase other types of services though A/E firms are a potential source to perform the proposed effort.

5.  Noncompetitive Proposals

Procurement by noncompetitive proposals allows for solicitation of a proposal from only one source and may be used only when one or more of the following circumstances apply:

a.  the item is available only for a single source;

b.  the public exigency or emergency for the requirement will not permit a delay resulting from competitive solicitation;

c.  the Federal awarding agency or pass-through entity expressly authorizes noncompetitive proposals in response to a written request from the District; and/or

d.  after solicitation of a number of sources, competition is determined to be inadequate.

D.  Contracting with Small and Minority Businesses, Women’s Business Enterprises, and Labor Surplus Area Firms:  

The District must take necessary affirmative steps to assure that minority businesses, women’s business enterprises, and labor surplus area firms are used when possible.  Affirmative steps must include:

1.  Placing qualified small and minority businesses and women's business enterprises on solicitation lists;

2.  Assuring that small and minority businesses, and women's business enterprises are solicited whenever they are potential sources;

3.  Dividing total requirements, when economically feasible, into smaller tasks or quantities to permit maximum participation by small and minority businesses, and women's business enterprises;

4.  Establishing delivery schedules, where the requirement permits, which encourage participation by small and minority businesses, and women's business enterprises;

5.  Using the services and assistance, as appropriate, of such organizations as the Small Business Administration and the Minority Business Development Agency of the Department of Commerce; and

6.  Requiring the prime contractor, if subcontracts are to be let, to take the affirmative steps listed

 E.  Contract/Price Analysis:  The District shall perform a cost or price analysis in connection with every procurement action in excess of $250,000 (i.e., the Simplified Acquisition/Small Purchase limit), including contract modifications.  (See 2 CFR 200.323(a)).  A cost analysis generally means evaluating the separate cost elements that make up the total price, while a price analysis means evaluating the total price, without looking at the individual cost elements.

The method and degree of analysis is dependent on the facts surrounding the particular procurement situation; however, the District shall come to an independent estimate prior to receiving bids or proposals.

When performing a cost analysis, the District shall negotiate profit as a separate element of the price. To establish a fair and reasonable profit, consideration is given to the complexity of the work to be performed, the risk borne by the contractor, the contractor’s investment, the amount of subcontracting, the quality of its record of past performance, and industry profit rates in the surrounding geographical area for similar work.

F.  Time and Materials Contracts:  The District shall use a time and materials type contract only (1) after a determination that no other contract is suitable; and (2) if the contract includes a ceiling price that the contractor exceeds at its own risk. Time and materials type contract means a contract whose cost to the District is the sum of the actual costs of materials, and direct labor hours charged at fixed hourly rates that reflect wages, general and administrative expenses, and profit.

Since this formula generates an open-ended contract price, a time-and-materials contract provides no positive profit incentive to the contractor for cost control or labor efficiently. Therefore, the District sets a ceiling price for each contract that the contractor exceeds at its own risk. Further, the District shall assert a high degree of oversight in order to obtain reasonable assurance that the contractor is using efficient methods and effective cost controls, and otherwise performs in accordance with the terms, conditions, and specifications of their contracts or purchase orders. 

G.  Suspension and Disbarment The District will award contracts only to responsible contractors possessing the ability to perform successfully under the terms and conditions of the proposed procurement. All purchasing decisions shall be made in the best interests of the District and shall seek to obtain the maximum value for each dollar expended. When making a purchasing decision, the District shall consider such factors as (1) contractor integrity; (2) compliance with public policy; (3) record of past performance/ and (4) financial and technical resources.

The Superintendent shall have the authority to suspend or debar a person/corporation, for cause, from consideration or award of further contracts. The District is subject to and shall abide by the non- procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR Part 180.

Suspension is an action taken by the District that immediately prohibits a person from participating in covered transactions and transactions covered under the Federal Acquisition Regulation (48 CFR chapter 1) for a temporary period, pending completion of an agency investigation and any judicial or administrative proceedings that may ensure. A person so excluded is suspended. (See 2 CFR Part 180 Subpart G).

Debarment is an action taken by the Superintendent to exclude a person from participating in covered transactions and transactions covered under the Federal Acquisition Regulation (48 CFR chapter 1). A person so excluded is debarred. (See 2 CFR Part 180 Subpart H).

The District shall not subcontract with or award sub-grants to any person or company who is debarred or suspended. For contracts over $25,000 the District shall confirm that the vendor is not debarred or suspended by either checking the Federal government’s System for Award Management (“SAM”), which maintains a list of such debarred or suspended vendors at www.sam.gov (which replaced the former Excluded Parties List System or EPLS); or collecting a certification from the vendor. (See 2 CFR Part 180 Sub part C).

Documentation that debarment/suspension was queried must be retained for each covered transaction as part of the documentation required under DAF-3, paragraph J. This documentation should include the date(s) queried and copy(ies) of the SAM result report/screen shot, or a copy of the or certification from the vendor.  It should be attached to the payment backup and retained for future audit review.  

 H.  Additional Requirements for Procurement Contracts Using Federal Funds:

1.  For any contract using Federal funds under which the contract amount exceeds the upper limit for Simplified Acquisition/Small Purchases (see DAF-3.C.2), the contract must address administrative, contractual, or legal remedies in instances where contractors violate or breach contract terms, and must provide for sanctions and penalties. (See 2 CFR 200, Appendix II(A)).

2.  For any contract using Federal funds under which the contract amount exceeds $10,000, it must address the District’s authority to terminate the contract for cause and for convenience, including the manner by which termination will be effected and the basis for settlement. (See 2 CFR 200, Appendix II(B)).

3.  For any contract using Federal funds under which the contract amount exceeds $150,000, the contract must include clauses addressing the Clean Air Act and the Federal Water Pollution Control Act. (See 2 CFR 200, Appendix II(G)).

4.  For any contract using Federal funds under which the contract exceeds $100,000, the contract must include an anti-lobbying clause, and require bidders to submit Anti-Lobbying Certification as required under 2 CFR 200, Appendix II (J).

5.  For each contract using Federal funds and for which there is no price competition, and for each Federal fund contract in which a cost analysis is performed, the District shall negotiate profit as a separate element of the price.  To establish a fair and reasonable profit, consideration must be given to the complexity of the work to be performed, the risk borne by the contractor, the contractor’s investment, the amount of subcontracting, the quality of the contractor’s past performance, and industry profit rates in the surrounding geographical area for similar work.  (See 2 CFR 200.323(b)).

I.  Bid Protest  The District maintains the following protest procedures to handle and resolve disputes relating to procurements and, in all instances, discloses information regarding the protest to the awarding agency.

A bidder who wishes to file a bid protest shall file such notice and follow procedures prescribed by the Request For Proposals (RFPs) or the individual bid specifications package, for resolution. Bid protests shall be filed in writing with the Superintendent within seventy-two (72) hours of the opening of the bids in protest.

Within five (5) days of receipt of a protest, the Superintendent shall review the protest as submitted and render a decision regarding the merits of the protest and any impact on the acceptance and rejection of bids submitted. Notice of the filing of a bid protest shall be communicated to the Board and shall be so noted in any subsequent recommendation for the acceptance of bids and awarding of contracts.

Failure to file a notice of intent to protest, or failure to file a formal written protest within the time prescribed, shall constitute a waiver of proceedings.

J.  Maintenance of Procurement Records The District shall maintain records sufficient to detail the history of all procurements. These records will include, but are not necessarily limited to, the following: rationale for the method of procurement, selection of contract type, contractor selection or rejection, the basis for the contract price (including a cost or price analysis), and records regarding disbarment/suspension queries or actions.  Such records shall be retained consistent with District Policy.

 DAF-4 - PROCUREMENT – ADDITIONAL PROVISIONS PERTINENT TO FOOD SERVICE PROGRAM

The following provisions shall be included in all cost reimbursable contracts for food services purchases, including contracts with cost reimbursable provisions, and in solicitation documents prepared to obtain offers for such contracts: (7 CFR Sec. 210.21, 215.14a, 220.16)

A.  Mandatory Contract Clauses:  The following provisions shall be included in all cost reimbursable contracts for food services purchases, including contracts with cost reimbursable provisions, and in solicitation documents prepared to obtain offers for such contracts:

1.  Allowable costs will be paid from the nonprofit school food service account to the contractor net of all discounts, rebates and other applicable credits accruing to or received by the contractor or any assignee under the contract, to the extent those credits are allocable to the allowable portion of the costs billed to the school food authority;

2.  The contractor must separately identify for each cost submitted for payment to the school food authority the amount of that cost that is allowable (can be paid from the nonprofit school food service account) and the amount that is unallowable (cannot be paid from the nonprofit school food service account); or

3.  The contractor must exclude all unallowable costs from its billing documents and certify that only allowable costs are submitted for payment and records have been established that maintain the visibility of unallowable costs, including directly associated costs in a manner suitable for contract cost determination and verification;

4.  The contractor's determination of its allowable costs must be made in compliance with the applicable departmental and program regulations and Office of Management and Budget cost circulars;

5.  The contractor must identify the amount of each discount, rebate and other applicable credit on bills and invoices presented to the school food authority for payment and individually identify the amount as a discount, rebate, or in the case of other applicable credits, the nature of the credit. If approved by the state agency, the school food authority may permit the contractor to report this information on a less frequent basis than monthly, but no less frequently than annually;

6.  The contractor must identify the method by which it will report discounts, rebates and other applicable credits allocable to the contract that are not reported prior to conclusion of the contract; and

7.  The contractor must maintain documentation of costs and discounts, rebates and other applicable credits, and must furnish such documentation upon request to the school food authority, the state agency, or the department.

B.  Contracts with Food Service Management Companies:  Procedures for selecting and contracting with a food service management company shall comply with guidance provided by the NHDOE, including standard forms, procedures and timelines for solicitation, selection and approval of proposals and contracts.

C.  “Buy American” Requirement:

Under the “Buy American” provision of the National School Lunch Act (the “NSLA”), school food authorities (SFAs) are required to purchase, to the maximum extent practicable, domestic commodity or product.  As an SFA, the District is required to comply with the “Buy American” procurement standards set forth in 7 CFR Part 210.21(d) when purchasing commercial food products served in the school meals programs.  This requirement applies whether the District is purchasing the products directly or when the products are purchased by third parties on the District’s behalf (e.g., food service management companies, group purchasing cooperatives, shared purchasing, etc.).

Under the NSLA, “domestic commodity or product” is defined as an agricultural commodity or product that is produced or processed in the United States using “substantial” agricultural commodities that are produced in the United States. For purposes of the act, “substantial” means that over 51 percent of the final processed product consists of agricultural commodities that were grown domestically.  Products from Guam, American Samoa, Virgin Islands, Puerto Rico, and the Northern Mariana Islands are allowable under this provision as territories of the United States.

1.   Exceptions: The two main exceptions to the Buy American requirements are:

a)  The product is not produced or manufactured in the U.S. in sufficient and reasonably available quantities of a satisfactory quality; or

b)  Competitive bids reveal the costs of a U.S. product are significantly higher than the non-domestic product.

2.  Steps to Comply with Buy American Requirements:  In order to help assure that the District remains in compliance with the Buy American requirement, theFood Service Director, shall

a)  Include a Buy American clause in all procurement documents (product specifications, bid solicitations, requests for proposals, purchase orders, etc.);

b)  Monitor contractor performance;

c)  Require suppliers to certify the origin of the product;

d)  Examine product packaging for identification of the country of origin; and

e)  Require suppliers to provide specific information about the percentage of U.S. content in food products 

DAF-5 - CONFLICT OF INTEREST AND MANDATORY DISCLOSURES

The District complies with the requirements of State law and the Uniform Guidance for conflicts of interest and mandatory disclosures for all procurements with federal funds.

Each employee, board member, or agent of the school system who is engaged in the selection, award or administration of a contract supported by a federal grant or award and who has a potential conflict of interest must disclose that conflict in writing to the Superintendent, who, in turn, shall disclose in writing any such potential conflict of interest to NHDOE or other applicable pass-through-entity.

A conflict of interest would arise when the covered individual, any member of his/her immediate family, his/her partner, or an organization, which employs or is about to employ any of those parties has a financial or other interest in or received a tangible personal benefit from a firm considered for a contract. A covered individual who is required to disclose a conflict shall not participate in the selection, award, or administration of a contract supported by a federal grant or award.

Covered individuals will not solicit or accept any gratuities, favors, or items from a contractor or a party to a subcontractor for a federal grant or award. Violations of this rule are subject to disciplinary action.

The Superintendent shall timely disclose in writing to NHDOE or other applicable pass-through-entity, all violations of federal criminal law involving fraud, bribery, or gratuities potentially effecting any federal award. The Superintendent shall fully address any such violations promptly and notify the Board with such information as is appropriate under the 

Purchasing Procedure and Authority

These procedures apply to the procurement of all material, equipment, supplies and services related to activities.  Herein mentioned as “item(s)” which is meant to imply all goods and services.  The type of purchase procedures required depends on the cost of the item(s) being purchased.  Petty cash with strict verification procedures, is used on emergency basis.  Purchasing procedures are designed to avoid assumption of risk and to ensure the best possible price for the desired products and services

It is the individual responsibility of each employee involved in the procurement process to adhere to the policies upon which these procedures are based, to include the meaning and intent of the procedures.  It is the responsibility of each person to bring questions or concerns relative to the procedures to the attention of the Finance Office.   The fundamental purpose of these procedures to provide a foundation for effective, consistent and complete consideration of all aspects involved in procurement.  

Pertinent information for the requisition such as vendor, item numbers, description, price and account information is the responsibility of the employee inputting the requisition.  The approval of such requisition is determined by the type of items and school which is requesting the item and the federal grant which is being used.  The employee shall determine if the vendor is an approved vendor in the financial system.  If the vendor is not approved, a Form W9 shall be obtained with required information.  The W9 will be sent to the Finance Office and the vendor will be added to the MUNIS system.  

Requisitions are entered by an approved user.  Once released, the approval process (below) is adhered to.  Requisitions are approved by levels dependent on what type of item is being procured.  The CFO is the purchasing agent, who functions under the supervision of the Superintendent, for the school district and as such, retains the authority to review and approve all purchases.  All expenses reimbursed by Federal Grants are required to use Purchase Orders.   All requisitions are processed into Purchase Orders (POs).  All POs are printed and processed by the Finance Office staff. 

Approval Process for each level:

School – Principal:  The principal of each school is the first level of approval of items.  He/she is responsible to determine that the item is being requested for the purpose intended.

Computers/Equipment:  Chief Information & Cyber Security Officer.  The Chief Information & Cyber Security Officer shall be responsible for authorizing the purchase of computers, equipment and software.

Federal Projects Director:  The Director is responsible for ensuring the item purchased is authorized and approved by the grant in which it is being charged.

CFO:  The CFO reviews the proposed cost to determine whether the funds are available within the grant.

Superintendent: The Superintendent has the final approval on all items to be purchased.

Manchester School District utilizes the Munis financial system, a Tyler Technology system, for the processing of all purchase orders.  Administrative assistants, teachers, principals and district administrators may request access to Munis.  Access is reviewed by the CFO/designee.  If access is approved, the CFO/designee determines the level of security appropriate for the individual.  Once training is completed, the individual can enter a requisition through the following process:

1.                  Enter a request to purchase a good or services into Munis (requisition entry) and release the requisition for review.

2.                  Each requisition must contain the vendor name/number, ship to location, quantity, item description, unit price, freight amount, and account code to be charged. The item description must be clear so as to properly communicate to the vendor the exact item requested and/or service to be performed, and deadlines for delivery and/or completion.

3.                  The requisitions go through the approval workflow.  If there are no errors, the requisition is approved and converted to a purchase order. Requisitions containing errors are sent back to the person who entered it for correction.

4.                  Munis assigns a unique requisition number to each requisition. Once the requisition is approved and converted to a purchase order, the purchase order is assigned a unique number.

Upon approval of the purchase order, the system generates three (3) copies of the printed purchase order: vendor, department, and accounting. The vendor copy is faxed, emailed and/or sent to the vendor. The school location receives the department copy and the Finance Office retains the accounting copy.  When the product/service has been received, the originator informs the Finance Office that the invoice can be paid.  Packing slips are reviewed and approved by the receiver and forwarded to the Finance office along with any invoices received.

Federal Project Expenses:  Federal Projects Director shall be responsible in the determination that the item is allowed under the Federal Grant in which it is being purchased.  The director shall also be responsible to verify that items have been budgeted and approved by NHDOE.  The availability of funds authorized under the grant is identified in the Grant Award Notice. 

DAF-6 - INVENTORY MANAGEMENT - EQUIPMENT AND SUPPLIES PURCHASED WITH FEDERAL FUNDS

Equipment and supplies acquired (“property” as used in this policy DAF-6) with federal funds will be used, managed, and disposed of in accordance with applicable state and federal requirements. Property records and inventory systems shall be sufficiently maintained to account for and track equipment that has been acquired with federal funds.  In furtherance thereof, the following minimum standards and controls shall apply to any equipment or pilferable items acquired in whole or in part under a Federal award until such property is disposed in accordance with applicable laws, regulations and Board policies:

A.  “Equipment” and “Pilferable Items” Defined:    For purposes of this policy, “equipment” means tangible personal property (including information technology systems) having a useful life of more than one year and a per-unit acquisition cost which equals or exceeds the lesser of $5,000, or the capitalization level established by the District for financial statement purposes.  “Pilferable items” are those items, regardless of cost, which may be easily lost or stolen, such as cell phones, tablets, graphing calculators, software, projectors, cameras and other video equipment, computer equipment and televisions.  

B.  Records: The Federal Project Department shall maintain records that include a description of the property; a serial number or other identification number; the source of the funding for the property (including the federal award identification number (FAIN)); who holds title; the acquisition date; the cost of the property; the percentage of the federal participation in the project costs for the federal award under which the property was acquired; the location, use, and condition of the property; and any ultimate disposition data, including the date of disposition and sale price of the property.

 C.  Inventory:  No less than once every two years, the Federal Projects Department shall cause a physical inventory of all equipment and pilferable items must be taken and the results reconciled with the property records at least once every two years

D.  Control, Maintenance and Disposition:  The Superintendent shall develop administrative procedures relative to property procured in whole or in part with Federal funds to:

1.  prevent loss, damage, or theft of the property; Any loss, damage, or theft must be investigated;

2.  to maintain the property and keep it in good condition; and

3.  to ensure the highest possible return through proper sales procedures, in those instances where the District is authorized to sell the property.

Maintenance of Equipment

In accordance with 2 CFR 313(d) the District maintains adequate maintenance procedures to ensure that property is kept in good condition.  Employees who are issued a device are responsible for maintaining and securing the equipment.  When a device is not working properly, the employee will submit a help desk ticket.  A member of the technology staff will work with the employee to identify and repair the computer as quickly as possible.

Lost or Stolen Items

The district maintains a control system that ensures adequate safeguards are in place to prevent loss, damage or theft of the property.  All hardware is inventoried and marked as property of the Manchester School District.  Employees are required to notify the IT Department when equipment is determined to be missing.

Use of Equipment

Equipment must be used in the program or project for which it was acquired as long as needed, whether or not the project or program continues to be supported by the federal award.  When no longer needed for the original program or project, the equipment may be used in other activities supported by the federal awarding agency.

Disposal of Equipment

When it is determined that original or replacement equipment acquired valued at over $5,000 under a federal award is no longer needed for the original project or program or for other activities currently or previously supported by a federal awarding agency, the grant manager will contact the awarding agency (or pass-through for a state-administered grant) for disposition instructions. Generally, disposition of equipment is dependent on its fair market value (FMV) at the time of disposition. If the item has a current FMV of $5,000 or less, it may be retained, sold, or otherwise disposed of with no further obligation to the federal awarding agency. If the item has a current FMV of more than $5,000, the federal awarding agency is entitled to the federal share of the current market value or sales proceeds.

Inventory will be maintained on all information technology hardware and software; and fixed assets, object codes in the 700 series.   Federal projects personnel maintain the inventory list on all items at the time of placing the order which includes serial number, source of funding, acquisition date, location, and cost of property.  An inventory tag, “City of Manchester School District” is placed on all items of value over $250.00.      Inventory information is shared with the NH Department of Education annually.  

DAF-7 - TRAVEL REIMBURSEMENT – FEDERAL FUNDS

The Board shall reimburse administrative, professional and support employees, and school officials, for travel costs incurred in the course of performing services related to official business as a federal grant recipient.

For purposes of this policy, “travel costs” shall mean the expenses for transportation, lodging, subsistence, and related items incurred by employees and school officials who are in travel status on official business as a federal grant recipient.

School officials and district employees shall comply with applicable Board policies and administrative regulations established for reimbursement of travel and other expenses.

The validity of payments for travel costs for all district employees and school officials shall be determined by the Federal Project Director.

Travel costs shall be reimbursed on a mileage basis for travel using an employee’s personal vehicle and on an actual cost basis for meals, lodging and other allowable expenses, consistent with those normally allowed in like circumstances in the district’s non-federally funded activities, and in accordance with the district’s travel reimbursement policies and administrative regulations.

Mileage reimbursements shall be at the rate approved by the Board or Board policy for other district travel reimbursements. Actual costs for meals, lodging and other allowable expenses shall be reimbursed only to the extent they are reasonable and do not exceed the per diem limits established by Board policy, or, in the absence of such policy, the federal General Services Administration for federal employees for locale where incurred.

All travel costs must be presented with an itemized, verified statement prior to reimbursement.

In addition, for any costs that are charged directly to the federal award, the Federal Projects Department shall maintain sufficient records to justify that:

A.  Participation of the individual is necessary to the federal award.

B.  The costs are reasonable and consistent with Board policy.

DAF-8 - ACCOUNTABILITY AND CERTIFICATIONS

All fiscal transactions must be approved by the Superintendent/designee who can attest that the expenditure is allowable and approved under the federal program. The Superintendent/designee submits all required certifications.

Record Keeping/Record Retention

 The District maintains all records that fully show the amount of funds under the grant that have been received and expended. For each grant awarded to the district a separate file is created which documents all financial activity associated with that grant. The file will include, fund award notifications, amendments and monthly/final reports. These grant documents are supported with Munis expenditure reports.

The U.S. Department of Education is authorized to recover any federal funds misspent within 5 years before the receipt of a program determination letter. 34 C.F.R. § 81.31(c). Consequently, the District must retain records for a minimum of five (5) years from the date on which the final Financial Status Report is submitted, unless otherwise notified in writing to extend the retention period by the awarding agency, cognizant agency for audit, oversight agency for audit, or cognizant agency for indirect costs. However, if any litigation, claim, or audit is started before the expiration of the record retention period, the records will be retained until all litigation, claims, or audit findings involving the records have been resolved and final action taken. 2 C.F.R. § 200.333.

Collection and Transmission of Records

Most records may be maintained in either paper or electronic form, based on the current practices in the district. Electronic storage will provide an easier means to share documents upon request i.e. auditors, records inquires, etc. In either case, care must be taken to ensure the materials chosen to create the record will last through the records retention period

DAF-9 - TIME-EFFORT REPORTING / OVERSIGHT

The Superintendent will establish sufficient oversight of the operations of federally supported activities to assure compliance with applicable federal requirements and to ensure that program objectives established by the awarding agency are being achieved. The District will submit all reports as required by federal or state authorities.

As a recipient of Federal funds, the District shall comply with the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Section 200.430 of the Code of Federal Regulations requires certification of effort to document salary expenses charged directly or indirectly against Federally-sponsored projects. This process is intended to verify the compensation for employment services, including salaries and wages, is allocable and properly expended, and that any variances from the budget are reconciled.

A.  Compensation:  Compensation for employment services includes all remuneration, paid currently or accrued, for services of employees rendered during the period of performance under the Federal award, including but not necessarily limited to wages and salaries. Compensation for personal services may also include fringe benefits, which are addressed in 2 CFR 200.431 Compensation – fringe benefits. Costs of compensation are allowable to the extent that they satisfy the specific requirements of these regulations, and that the total compensation for individual employees:

1.  is reasonable for the services rendered, conforms to the District’s established written policy, and is consistently applied to both Federal and non-Federal activities; and

2.  follows an appointment made in accordance with the District’s written policies and meets the requirements of Federal statute, where applicable.

B.  Time and Effort Reports:  Time and effort reports shall:

1.  be supported by a system of internal controls which provide reasonable assurance that the charges are accurate, allowable, and properly allocated;

2.  be incorporated into the official records of the District;

3.  reasonably reflect the total activity for which the employee is compensated by the District, not exceeding 100% of the compensated activities;

4.  encompass both Federally assisted and other activities compensated by the District on an integrated basis;

5.  comply with the District’s established accounting policies and practices;

6.  support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one (1) Federal award, a Federal award and non-Federal award, an indirect cost activity and a direct cost activity, two (2) or more indirect activities which are allocated using different allocation bases, or an unallowable activity and a direct or indirect cost activity.

The District will also follow any time and effort requirements imposed by NHDOE or other pass-through entity as appropriate to the extent that they are more restrictive than the Federal requirements. The Federal Projects Director/designee is responsible for the collection and retention of employee time and effort reports. Individually reported data will be made available only to authorized auditors or as required by law.

Time and Effort Procedures

All employees who work on a single cost objective must complete a semi-annual certification.

The semi-annual certification must be: 

1. Completed at least every six (6) months

2. Be signed by the employee or the supervisor with direct knowledge of the work being performed

3. Reflect an after-the-fact distribution of the actual activity; and

4. Account for the total activity for which each employee is compensated.

All employees who work on multiple cost objectives must complete a personnel activity report (PAR) that supports the distribution of their salaries/wages that meet the following standards:

1. Reflect an after-the-fact distribution of the actual activity;

2. Account for the total activity for which each employee is compensated;

3. Are prepared at least monthly & coincide with one or more pay periods; and

4. Are signed by the employee

The Project Manager determines which form must be completed and reaches out to the employees to request submission of the appropriate form.

Hourly employees who sign a weekly time sheet do not need to complete a semi-annual or monthly certification, however, the time sheet that they complete must state clearly which grant the employee is being charged to.

 DAF-10 - GRANT BUDGET RECONCILIATION

The District Accountant reconciles the grant budget to actual expenses on a monthly basis.  Budget estimates are not used as support for charges to Federal awards.

The District’s internal controls include a process to review after-the-fact interim charges made to a Federal award based on budget estimates and ensure that all necessary adjustments are made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. 

DAF-11 - SUB-RECIPIENT MONITORING AND MANAGEMENT

When entering agreements involving the expenditure or disbursements of federal grant funds, the District shall determine whether the recipient of such federal funds is a “contractor” or “subrecipient”, as those terms are defined in 2 CFR §200.23 and §200.93, respectively.  See also guidance at 2 CFR §200.330 “Subrecipient and contractor determinations”.  Generally, “subrecipients” are instrumental in implementing the applicable work program whereas a “contractor” provides goods and services for the District’s own use.  Contractors will be subject to the District’s procurement and purchasing policies (e.g DAF-3 relative to federal grant funds.   Subrecipients are subject to this Policy.

Under the UGG, the District is considered a "pass-through entity" in relation to its subrecipients, and as such requires that subrecipients comply with applicable terms and conditions (flow-down provisions). All subrecipients of Federal or State funds received through the District are subject to the same Federal and State statutes, regulations, and award terms and conditions as the District.

A.  Sub-award Contents and Communication. 

In the execution of every sub-award, the District will communicate the following information to the subrecipient and include the same information in the sub-award agreement.

1.  Every sub-award will be clearly identified and include the following Federal award identification:

a)  Subrecipient name

b)  Subrecipient’s unique ID number (DUNS)

c)  Federal Award ID Number (FAIN)

d)  Federal award date

e)  Period of performance start and end date

f)  Amount of federal funds obligated

g)  Amount of federal funds obligated to the subrecipient

h)  Total amount of the Federal award

i)  Total approved cost sharing or match required where applicable

j)  Project description responsive to FFATA

k)  Name of Federal awarding agency, pass through entity and contact information

l)  CFDA number and name

m)  Identification of the award is R&D

n)  Indirect cost rate for the Federal award

2.  Requirements imposed by the District including statutes, regulations, and the terms and conditions of the Federal award.

3.  Any additional requirements the District deems necessary for financial or performance reporting of subrecipients as necessary.

4.  An approved indirect cost rate negotiated between subrecipient and the Federal government or between the pass-through entity and subrecipient.

5.  Requirements that the District and its auditors have access to the subrecipient records and financial statements.

6.  Terms and conditions for closeout of the sub-award.

B.  Subrecipient Monitoring Procedures.

The Superintendent is responsible for having all the District project managers monitor subrecipients.  The District will monitor the activities of the subrecipient to ensure the sub-award is used for authorized purposes.  The frequency of monitoring review will be specified in the sub-award and conducted concurrently with all invoice submission. 

Subrecipient monitoring procedures include:

1.  At the time of proposal, assess the potential of the subrecipient for programmatic, financial, and administrative suitability. 

2.  Evaluate each subrecipient’s risk of noncompliance prior to executing a sub-award.  In doing so, the District will assess the subrecipient’s:

a)  Prior experience with the same or similar sub-awards.

b)  Results of previous audits and single audit (if applicable).

c)  New personnel or new or substantially changed systems.

d)  The extent and results of Federal awarding agency monitoring.

3.  Confirm the statement of work and review any non-standard terms and conditions of the sub-award during the negotiation process.

4.  Monitor financial and programmatic progress and ability of the subrecipient to meet objectives of the sub-award. To facilitate this review, subrecipients are required to submit sufficient invoice detail and a progress report. The District project managers will encourage subrecipients to submit regular invoices. 

5.  Invoices and progress reports will be date stamped upon receipt if received in hard copy.  A record of the date of receipt will be maintained for those invoices sent electronically.

6.  In conducting regular oversight and monitoring, the District project managers will:

a)  Verify invoices that include progress reports.

b)  Review progress reports to ensure the project is progressing appropriately and on schedule.

c)  Compare invoice to agreement budget to ensure eligibility of costs and that costs do not exceed budget.

d)  Review invoice to ensure supporting documentation is included and invoices costs are within the scope of work for the projects being invoiced.

e)  Obtain report, certification and supporting documentation of local (non-federal)/in-kind match work from the subrecipient.

f)  Review subrecipient match tasks for eligibility.

g)  Initial the progress report and invoice confirming review and approval prior to payment.

h)  Raise any concerns to the Superintendent/designee.

7.  The Superintendent/designee, upon recommendation from the project’s manager, will approve the invoice payment and will initial invoices confirming review and approval prior to payment.

8.  Payments will be withheld from subrecipients for the following reasons:

a)  Insufficient detail to support the costs billed;

b)  Unallowable costs;

c)  Ineligible costs; and/or

d)  Incomplete work or work not completed in accordance with required specifications.

9.  Verify every subrecipient is audited in accordance with 2 CFR §200 Subpart F – Audit Requirements.

C.  Subrecipient Project Files. Subrecipient project files will contain, at a minimum, the following:

a)  Project proposal

b)  Project scope

c)  Progress reports

d)  Interim and final products

e)  Copies of other applicable project documents as required, such as copies of contracts or MOUs

D.  Audit Requirements.

All subrecipients are required to annually submit their audit and Single Audit report to the District for review to ensure the subrecipient has complied with good accounting practices and federal regulations.  If a deficiency is identified, the District will:

1.  Issue a management decision on audit findings pertaining to the Federal award.

2.  Consider whether the results of audits or reviews indicate conditions that necessitate adjustments to pass through the entity's own records.

E.  Methodology for Resolving Findings.

The District will work with subrecipients to resolve any findings and deficiencies.  To do so, the District may follow up on deficiencies identified through on-site reviews, provision of basic technical assistance, and other means of assistance as appropriate. 

The District will only consider taking enforcement action against non-compliant subrecipients in accordance with 2 CFR 200.338 when noncompliance cannot be remedied.  Enforcement may include taking any of the following actions as appropriate:

a)  Temporarily withhold cash payments pending correction of the deficiency

b)  Disallow all or part of the cost of the activity or action not in compliance.

c)  Wholly or partly suspend or terminate the sub-award.

d)  Initiate suspension or debarment proceedings.

e)  Withhold further Federal awards for the project or program.

f)  Take other remedies that may be legally available.

Revisions: First Reading Policy: 3/16/2022

Second Reading and Adoption BOSC: 3/28/2022.