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Grant Funds Matching in AmeriCorps and Other Programs

Grant Funds Matching in AmeriCorps and Other Programs. Briefing on Requirements and Practices. What is match?. “Match” is the share of a project’s total cost that a grantee must pay for with their own money, also called the “non-federal share.” There are two types of match: Cash

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Grant Funds Matching in AmeriCorps and Other Programs

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  1. Grant Funds Matchingin AmeriCorps and Other Programs Briefing on Requirements and Practices August 6, 2005

  2. What is match? “Match” is the share of a project’s total cost that a grantee must pay for with their own money, also called the “non-federal share.” There are two types of match: • Cash • In-kind contributions Government-wide with few rare exceptions grantees can not use other federal funds as match August 6, 2005

  3. Statutory vs. budgeted match rate • Statutory – the minimum matching amount that the law/regulation requires a grantee to provide • Regulatory – the minimum matching that the Corporation has established by regulation which may be higher than the statutory requirement. • Budgeted – the amount of match that a grantee is providing based upon the budget, budget narrative, and program narrative in their grant application – this may be greater than the statutory match required (see below) “Catch 22” – While budgeting match above the statutory and regulatory requirements is considered voluntary, a budgeted match rate is closely tied to the number of members proposed, and is a contracted match that affects both the scope of work and the closeout process. August 6, 2005

  4. Summary of Match RequirementsLearn & Serve • K-12 (School and Community Based) • 1st Year - 10% of total funds • 2nd Year - 20% of total funds • 3rd Year - 30% of total funds • 4thYear and after - 50% of total funds • Higher Ed - 50% of total funds August 6, 2005

  5. Senior CorpsMatch Requirements • Retired Senior Volunteer Program (RSVP) • 1st Year - 10% of total funds • 2nd Year - 20% of total funds • 3rd Year and after - 30% of total funds • Foster Grandparents and Senior Companion Program • 10% of total funds • Volunteer support should not exceed 20% of total funds August 6, 2005

  6. Traditional AmeriCorpsMatch Requirements • Match percentages should be calculated from the Financial Status Report (FSR) Form 269a • AmeriCorps Budget Section II - Member support should be reported semi-annually, match must be 15% cash at minimum. These are funds that are a fundamental part of Member stipend totals • AmeriCorps Budget Sections I & III - Operating expenses are 33 % of total operating costs at a minimum August 6, 2005

  7. New: INCREASED EMPHASIS ON COST EFFECTIVENESS AND MATCH IN APPLICATIONS FOR 2006 • Cost Effectiveness (15%) and Budget Adequacy (10%) now total 25% of new application competitive review criteria • Both factors (cost effectiveness and budget) include match considerations and ability to document match • Part of Program and Budget Review is Community Output (20% of total grantee competitive rating) is Sustainability • Sustainability includes community investment, diversification of funding sources as evidenced by direct contributions and by cash and in-kind match. August 6, 2005

  8. NEW MATCH RULES FOR 2006, AND BEYOND, ARE FOUND IN 45 CFR 2521.35 TO 2521.90 AS SUMMARIZED • Education Award Budget Reviews – new rules do not apply • Tribes – Under PL 93-638 new rules apply but all USG funds are considered non-federal for match purposes • State Commissions – must meet their overall Aggregate match based on individual grantees’ meeting their requirements • Basic Member Match as in Past: Federal share (CNCS and other Federal funds) cannot exceed 85 percent of total minimum living allowance. QED – Grantee share must be 15% cash or above of stipend costs. • Basic Operational Match As in Past: CNCS share of operating costs may not exceed 67%. Match can be cash or in-kind for grantee amounting to 33% or more of this total. August 6, 2005

  9. New Rule: “Overall” Regulatory and Budget Matches • Definition: In addition to both basic matches above, under 2521.60(a) or .60(b) a new “Overall Match” is required. • Overall Match: Total match contribution of grantee in comparison to CNCS contribution of total budget. Overall match is on a sliding scale, increasing per year. It has a base rate only after three years’ grant experience of 26% of total budget costs (see charts). • Definition: Budgeted Match is the match as stated in the approved budget and it may exceed basic regulatory match levels. Failure to meet these even higher levels is a performance factor in future grant competitions August 6, 2005

  10. How does an organization meet their matching obligation? • Cash from… • Donations • Non-federal income • State appropriations/commission budgets • In-kind contributions • Value of donated labor; • Value of donated space; • Value of donated vehicles; • Value of donated GED services, etc. • Unfunded indirect cost rate • If a grantee’s approved indirect cost rate is greater than the 5% allowed by the AmeriCorps program, the unfunded difference can be counted towards the grantee’s matching obligation August 6, 2005

  11. Sample grant budget August 6, 2005

  12. Overall Match Calculation Considerations I While Program Operating Cost match is 67% vs. 15% for Member Support Cost, Member Support Cost is often the larger dollar amount of match paid by grantees because the Member Support component of a program is largest. Therefore, it may be more difficult for grantees to meet the “Overall Match” requirement when a large share of their match is for member living allowances. Grantees typically add a member only when they have the cash match assured; therefore grantees are likely to meet the required Member Support Cost match. August 6, 2005

  13. Regulatory – New “Overall Match” Requirement Examined • 2521.60(a) – Regulatory Match – Grantees must meet minimum requirements as shown in table below up to 50% overall match ($1 dollar for every CNCS $1) by year 10 (chart) August 6, 2005

  14. What influences a grantee’s proposed “budgeted” match? • Cash match requirement: Since grantees must match member living allowances with cash, grantees can only propose a program size (number of members) up to the amount of cash they can generate realistically. • No transfer between categories: The Corporation generally does not allow grantees to transfer funds approved for Member Support Costs into Program Operating budget categories. • Meeting Member Match, if cash match to cover Member Support Costs isn’t raised, members should not be enrolled unless those funds are available. Cash match is real dollars provided to the Members and therefore is necessary as budgeted. August 6, 2005

  15. When is match examined? • Application and Award phases: From a programmatic and financial viability perspective, sources of match are examined to validate that they are reasonable and likely to be achieved and allowable. • During Program Monitoring and/or Site Visits to Programs • Post-award: With each financial report, progress towards meeting statutory match is monitored. Problems meeting budgeted match are flagged during renewal application consideration. • Closeout: Financial reports are examined to verify that statutory and regulatory minimums have been met. Failure to meet budgeted match may result in decreased funding in new competitions or possibly a “no” decision for funding. Failure to meet statutory match will result in a pro-rated disallowance in CNCS funding August 6, 2005

  16. When do financial reports come in? • Financial reports are due every 6 months over the course of a 3-year grant period • FSR reports are cumulative over the entire 3-year period. • WBRS is being integrated in 2005 into eGrants and will serve as the mechanism for FSR and match reporting. August 6, 2005

  17. Typical Financial Report August 6, 2005

  18. Why match could be lower than 15% or 33% today… • In-kind match is met over the 3-year full grant period, so that at any time it may appear deficient. Inability to meet budgeted cash match may affect member stipends and will be questioned at any time. • Certain grantees (universities, tribes) are more likely to enter match contributions toward the end of the grant year or period. August 6, 2005

  19. Determination of Acceptability of Costs • Conditions in award letter • Provisions • OMB Circulars • Program Applicability • Allocable • Allowable • Reasonable • Necessary August 6, 2005

  20. Matching • Match: • Must be verifiable from recipient records • Must not be included as contribution for other federally-assisted program • Must be necessary and reasonable for accomplishing program objectives • Must be allowable according to cost principles (OMB Circulars) August 6, 2005

  21. Documentation • Grantees must maintain adequate documentation to support amounts claimed as match. • Documentation requirements are for BOTH CNCS and Grantee share • Documentation should also ensure that costs: • Conform to grant/contract limitations • Are treated consistently • Determined in accordance with Generally Accepted Accounting Principles (GAAP) August 6, 2005

  22. Recording and Reporting In-Kind Contributions • Documentation of In-kind contributions - same standards as other expenditures • Documentation for In-Kind contributions must record donation and valuation of item. It should describe the donation in detail. • In-kind contributions should be entered into the General Ledger as income and expenditure. • Failure to enter match contributions into General Ledger requires a formal explanatory policy and separate spread sheet accountability of receipt and use. • Included in Financial Status Report submitted to the Corporation to be recognized as match August 6, 2005

  23. Valuation of In-Kind Services Based on Fair Market Value Fair market value What-would-you-pay-if-it-was-not-donated? = August 6, 2005

  24. Documenting In-Kind Contributions Received Document the basis for determining the value of personal services, material equipment, building, and land. Obtain written acknowledgement of the contribution which should include: * Name and signature of donor * Date and Location of donation * Detailed description of item/service * Estimated value - Keep a copy of the receipt in your files. August 6, 2005

  25. In-kind Donation Documentation • Donations, Letters / statements of costs that show the type of donation, value, and frequency • Time and Effort Forms or others that show contribution of time to program by staff working on program . Staff rates costed based on professional rate. • In Kind Receipt/Voucher Forms • Federally approved Indirect Cost Rate Agreement including base of calculation needed for use as match. August 6, 2005

  26. Acceptable Sources Of In-Kind Contributions - Examples • Professional Services • Value of donated meeting space • Value of administrative services provided by host agency • Costs of training for members and staff • Public service announcements • Recognition events August 6, 2005

  27. Volunteer Exception For Match • Grantees match may not include the value of direct community services performed by volunteers • Services that contribute to organizational functions such as accounting, training of staff or members can be counted as match, but are limited to elements of the grantee’s cost allocation plan. August 6, 2005

  28. The ABCD Tutoring Program 1299 N Main Street, Suite 110, Great City, Good State 00000-1234, (800) 555-1212, Fax 321-1234 In-Kind Contribution Form Name of Contributing Organization/Agency/Business/Individual: Address of Above Contributor: ______________ Phone #: __________________ Printed/Typed Name of Contributor’s Authorized Signee: ________________ Title: _______________ Signature of Authorized Signee: ____________________________________ Date: ______________ August 6, 2005

  29. Documentation Objective • All in-kind contributions should contain documentation that supports: • Whatis the service or goods obtained • Why the transaction is allowable for the grant purposes • The value of the contribution • Accounting records should trace back to source documentation • If audited, a grantee may be required to get full supporting documentation from all donors unless available during the audit. August 6, 2005

  30. Documentation Examples Staff Activity Reporting Guidelines • All salaries and wages charged to the Corporation grants must be supported by signed Time & Attendance records except for: • State, Local and Indian Tribal governments which must comply with OMB A-87 • Educational Institutions which must comply with OMB A-21 August 6, 2005

  31. Contributed Services Valuation Financial Accounting Standards (SFAS #116) • Contributed services are recognized in the financial statements if the services received: • Create or enhance non-financial assets • Require specialized skills and • Are provided by individuals possessing those skills • Would need to be purchased if not provided by donation August 6, 2005

  32. Financial StatementsIn-Kind Contributions Examples • The following were donated to a grantee during the fiscal year: • Training services valued at $3,544 • Office space valued at $12,000 • Office supplies valued at $6,000 • Services of volunteers working side-by-side with service participants members valued at $10,000 • The following pages show the financial statement presentation August 6, 2005

  33. Teach Tech - Statement of Activities March 31, 2004 Revenues and Other Support AmeriCorps Grant $ 56,000 Contributions 21,544 Total Revenues and Support 77,544 Expenses Salaries and Living Expenses 39,400 Benefits 7,000 Consultants 1,000 Staff travel 1,000 Supplies 6,000 Communications 1,050 Rent 12,000 Donated Services 3,544 Depreciation expenses 4,000 Other expenses 1,590 Total Expenses 76,584 Excess of Revenues and Other Support Over Expenses 960 Beginning Net Assets 300,416 Ending Net Assets $ 301,376 6,000 12,000 3,544 21,544 August 6, 2005

  34. Teach Tech Statement of Activities March 31, 2002 Revenues and Other Support AmeriCorps Grant $ 56,000 Total Revenues and Support 56,000 Expenses Salaries and Living Expenses 39,400 Benefits 7,000 Consultants 1,000 Staff travel 1,000 Communications 1,050 Depreciation expenses 4,000 Other expenses 1,590 Total Expenses 55,040 Excess of Revenues and Other Support Over Expenses 960 Beginning Net Assets 300,416 Ending Net Assets $ 301,376 FINANCIAL STATEMENT WITHOUT IN-KIND CONTRIBUTIONS August 6, 2005

  35. What happens when match is not met? • Failure to meet statutory match during award • Decreases in renewal funding • Budget revision • Possible disallowance of Federal share • Close monitoring and special conditions, if necessary, on the grant • Technical assistance • Less competitive for other funding • Possible hold on funds if members are affected • Failure to meet statutory match at closeout • Disallowance is required unless waived during award review and negotiation, grantee refunds federal funds Failure to meet budgeted match at closeout • Less competitive in future awards • Potential for disallowance on case-by-case basis if overmatching of living allowances is involved and not met August 6, 2005

  36. Records Retention • Retain all financial records: • 3 years from date of submission of final Financial Status Report • If there is an on-going audit: 3 years from final audit resolution August 6, 2005

  37. Questions August 6, 2005

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