GRANTS MANAGEMENT POLICY AND PROCEDURES

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1 GRANTS MANAGEMENT POLICY AND PROCEDURES ADOPTED BY THE BOARD OF SUPERVISORS: JANUARY 06, 1997, ITEM No. 15b (1-4), ID #: 9703; MARCH 19, 2012, ITEM No. C5. INTRODUCTION PURPOSE The purpose of the Grants Management Policy and Procedures is to establish clear guidance, procedures, and the County's position regarding application, acceptance, budgeting, and administration of Yuma County grants when the County is the grantee. The County desires to obtain grant funding to reduce County taxpayer burden and to provide services the Board of Supervisors has determined to be beneficial to the citizens of Yuma County. APPLICABILITY All County agencies and departments are subject to this Policy. All grants received by the County are subject to this policy. However, for those grants that require no application or received on an entitlement basis, the grant application, grant award, or other portions of this policy may not be applicable. Any questions regarding the applicability of portions of this policy should be resolved by contacting the Financial Services Department. GENERAL PRINCIPLES The County encourages its agencies and departments to seek supplemental grant funding when the resulting grant meets all requirements stated in this policy. Grant funding is a significant percentage of County revenues and their receipt is vital to County operations. This Policy establishes the following principles: * The total additional costs associated with each new grant, including estimated indirect costs, must be identified for all grants. * When the grantor accepts indirect costs as an allowable cost, any expected indirect costs shall be included in the grant application, and any incurred and allowable indirect costs shall be computed and reported for reimbursement charged at the rate calculated in the current Yuma County Cost Allocation plan or as stipulated by the grantor. * All additional direct costs incurred to support a grant funded program shall be funded from the grant budget. Some expenditures may be charged to the operating budget of the agency or department benefitting from the grant (the grantee) as approved by the Board of Supervisors. * Upon grant expiration, all approved matching County funding and all positions funded by the grant will end. The County's personnel application form will be amended to include an acknowledgment stating "I further understand that, if employed in a grant funded position, my continued employment is contingent upon availability of funds and my position will be abolished when the grant expires unless alternate funding is secured." The Board of Supervisors may, at its discretion, continue funding a program or position previously funded from grant revenues. After notifying the County Administrator, the grantee may choose to continue to fund operating and capital expenses from an expired grant, using other funds available to that agency or department. However, continuation of positions funded from expired grants requires approval by the Board of Supervisors. * The grantee is responsible for adhering to all policies and procedures attached to the grant by the grantor.

2 GRANT APPLICATION PROCESS Application processes are often time consuming and costly. Grantees should ensure that the available grant meets the requirements contained in this Policy prior to submitting the application. In cases when the grant may not meet this Policy's requirements or when assistance is needed to determine the direct/indirect cost impact of the grant, grantees are encouraged to send a copy of the grant application to the Financial Services Department to receive assistance and guidance prior to submitting the application. APPLICATION APPROVAL Agencies or departments do not need to receive the approval of the Board of Supervisors to submit a grant application unless: 1) the grantor requires it; or 2) the grant, if awarded by the grantor, would require Board execution and the Board could not refuse to accept the grant at that point. INDIRECT/DIRECT COST RECOGNITION AND RECOVERY "Indirect" costs are those that do not appear in an agency or project budget, but are necessary expenses to provide the service funded by the grant. Typical indirect costs may include: office space; building maintenance; utilities; insurance; and, administrative support from the County s central services departments and Board of Supervisors; etc. Please refer to the Yuma County Indirect Cost Plan as mandated by the Office of Management and Budget s (OMB) Circular A-87 Cost Principles for State, Local and Indian Tribe Governments. Indirect costs incurred to support grant funded services will be reported for reimbursement when the grantor accepts indirect costs as an allowable cost. These indirect costs will be charged to each respective grant budget expenditure by the Financial Services Department. The Financial Services Department will be responsible for all indirect cost calculations based on grant type and required central services utilized by the grant. Indirect cost expenditures and revenues will be analyzed at the end of each year and reclassified if necessary to prevent overstatement of revenues and expenditures among funds. All additional Direct costs incurred to support a grant funded program will be funded from the grant budget or the operating budget of the grantee benefitting from the grant as approved. In the event the grantee is unwilling or unable to incur these additional direct costs in their operating or grant budget, it will be the grantee s responsibility to procure the additional funds needed. ADVANCED NOTIFICATION TO OTHER COUNTY DEPARTMENTS When the grant provides funds for new positions, grantees are encouraged to contact the Human Resources Department as soon as possible during the application process or upon grant award notification to begin the position classification process. The Human Resources Department approved position classifications should be received prior to requesting Board of Supervisors' approval to allow grantees to begin the hiring process. The hiring process may begin immediately upon Board authorization. The General Services Department should also be contacted during the application process if receipt of the grant will result in additional office or storage space. The General Services Department can advise on what office or storage space is available, for possible inclusion in the application for any grant reimbursement. 2

3 If computer equipment, network connections, or telephone installations will be required, the Information and Technology Services Department should be contacted during the grant application process to accurately estimate those requirements, and as soon as the grant award is received in order to complete those installations on a timely basis, also to set up new employees network account profile. GRANT AWARD AND ACCEPTANCE FINAL APPROVAL PROCESS Upon receipt of a grant award notification, the grant execution documents and a completed Grant Review Form (see attachment A ) shall be forwarded to the Financial Services Department for its review and proper approval routing. The Office of Management and Budget will: 1) determine if a budget revision is required; and, 2) confirm the identification of any matching funds and additional indirect costs. The County Attorney will then review the form of the grant agreement. Once the Financial Services Department, Office of Management and Budget, and the County Attorney have completed their reviews and any issues they have raised are resolved, approval and execution of the grant agreement shall observe the following authorization levels as approved by the Board of Supervisors: GRANT AUTHORIZATION LEVELS Types of Grants Grant agreements to or from other governmental units and other public, private, and non-profit organizations. Intergovernmental agreements for contracted services, joint purchases. Intergovernmental agreements regarding land use or transportation plans, legislative issues, other policy matters. Approval Authority Agency or department head and/or County Administrator may execute grant agreements which are within budgeted appropriations and revenues, and are approved as to form by the County Attorney. NOTE: The Board of Supervisors shall receive a summary of grants entered into. Also, Grantee must ensure that new employees are informed their positions may terminate with the grant. Agency or department head and/or County Administrator may execute intergovernmental agreements which are within budgeted appropriations and revenues, and are approved as to form by the County Attorney. Board approval required if other parties to the agreement require it. NOTE: The Board of Supervisors shall receive a summary of grants entered into. Also, Grantee must ensure that new employees are informed their positions may terminate with the grant. Requires Board of Supervisors' approval. 3

4 MULTI-YEAR AGREEMENTS No multi-year agreement shall be executed with a "non-appropriation" clause permitting termination in the event of inadequate funding. No multi-year agreement entered into by the agency or department head shall obligate the Board of Supervisors to provide sufficient funding to meet any future year funding expectations. MATCHING FUNDS Grants and Intergovernmental agreements will identify how matching funds will be provided and their type. Matching funds maybe in cash or in-kind. GRANT ADMINISTRATION PROCEDURES GRANT START-UP The grantee is authorized to employ all staff positions approved by the Board of Supervisors, and engage in the normal operational activities necessary to carry out the services as allowed in the grant. In addition to the Grant requirements, all county policies and procedures must be followed when expending grant funds. GRANT BUDGETING AND ACCOUNTING Each grant will be assigned individual grant account codes if separate funding tracking is required or if using the Grants module to record all operational transactions. The Financial Services Department will process the necessary budget revisions to the general ledger (i.e., an overall increase or decrease in the agency's budget) upon Board of Supervisors approval. Each grant budget will be coded so as to prevent the over expenditure of the grant and to ensure the grant budget is not used to support non-grant activities. All individual grant revenues and expenditures must be coded to their assigned Grant account codes. All salary expenditures must be supported by adequate documentation as required by the grantor agency and Federal 2 CFR, Part 225 (OMB Circular A-87). Grantees shall charge all expenditures directly to assigned grant account codes instead of charging grant related costs in other departmental account codes that subsequently require a transfer to the grant account code by journal entry. Grantees are also responsible for maintaining accurate grant budgets and to ensure all grant expenditure and revenue transactions are coded to the appropriate grant account code. GRANTS CROSSING FISCAL YEARS The County may accept multi-fiscal year grants. For those grants that continue into the subsequent fiscal years, grantees are encouraged to estimate the remaining grant budget during the budget preparation period for those subsequent fiscal years. If the remaining grant funding at year-end has been incorrectly estimated, the Agency Head should prepare an Agenda Item Review (AIR) form to reconcile the actual remaining grant budget with the adopted County budget. When multi-year grant agreements authorize the total grant allocation initially, the County will appropriate the same amount. If the grantor allocates funds for a multi-year grant in single program/fiscal year increments, then the County should also appropriate likewise. Subsequent fiscal year appropriations should agree with grantor allocations. GRANT REPORTING AND AUDITING Grant recipient agencies or departments are responsible for ensuring that all grant funds are expended in accordance with specific grant regulations and are responsible for ensuring that any fiscal and programmatic reporting requirements are adhered to. 4

5 Agencies are encouraged to contact the Financial Services Department to receive guidance in report preparation and to obtain on-line information or reports necessary to prepare them. The reports shall be maintained by each Grantee for review by auditors, grantor representatives, and County staff. Reports shall be approved by appropriate County officials as required by the grant. Copies of all grant required reports must be forwarded to the Financial Services Department attention Grants Auditor. Financial reports shall be maintained on file until all audits have been accepted by the grantor, for no less than three fiscal years, or for other such length specified by the grantor, whichever is longest. All County grants are subject to periodic review by the Financial Services Department, Chief Financial Officer, representatives of the grantor, or by the County's auditors. The grantee shall have grant files and supporting documentation available for annual audit review. Any audit findings and/or questioned costs resulting from the audit will require a written response to the Financial Services Department within the designated response period. All Federal Grant funds will be included in the County's annual A-133 single audit. GRANT REVENUE RECEIPT AND RECORDING The grantees are responsible for preparing financial reports to be sent to the grantor to obtain reimbursement of grant funds expended. These reports shall be submitted timely to replace advanced County funds. Copies of all reimbursement requests must be forwarded to the Financial Services Department attention Grants Auditor. For any grant revenues received by grantees, the revenues should be deposited daily and credited to a grant revenue account code, unless an exception is approved by the Financial Services Department. Grant reimbursements should never be credited to an expenditure account. The Financial Services Department will review grant revenues periodically to ensure proper revenue recognition. At the end of each fiscal year, the Financial Services Department will review each grant program to accrue the earned revenue to be received after the end of the fiscal year from the grantor. GRANT AMENDMENTS Grants are often amended to shift allocated funds from one cost category to another, increase or decrease the grant budget, change the grant period or to alter the programmatic requirements. Grantees are authorized to execute grant amendments that do not require an overall increase or decrease to the budget. Any amendment that would increase or decrease the overall grant budget shall be submitted on an Agenda Item Review (AIR) Form to the Financial Services Department and will follow the same process as when approving new Grants. If approved, by the Board of Supervisors, the grantee will be notified via NOBA (Notice of Board Action), and only then will be authorized to initiate amended grant services and send signed documents to the grantor. The County budget cannot be legally amended after the end of the fiscal year to incorporate previous amendments approved by the grantor. Therefore, grantees should use caution to ensure no grant funds are expended prior to approval and appropriation by the Board of Supervisors. 5

6 Grants accepted by the Board of Supervisors with the Annual Budget do not need to go to the Board again, except when the overall budget authority needs to be increased, based on the Summary of grants listing provided for within the Grant Authorization Levels. All other grant amendments will be processed using a Grants Administrative Approvals Agenda Item Review (GAAAIR) Form. The Financial Services Department will process and properly route these amendments after receiving the required GAAAIR form, a signed and executed grant contract/agreement, Grant Review Form (GRF), and Administrative Budget Amendment form. GRANT TERMINATION Unless approved by the Board of Supervisors, the County will not continue a grant funded program once the grant ends. Therefore, all grant supported staff positions will be abolished if the grant funding supporting them is eliminated. Grantees should submit the appropriate paperwork to the Human Resources Department to abolish the terminating positions. Please contact the Financial Services Department and Chief Financial Officer if the agency elects to terminate a grant funded program prior to the scheduled grant ending date. Procedures regarding the use, transfer and disposition of capital assets purchased with grant funds are addressed in the County's Capital Assets Accounting Policies. Grantees may choose to continue operating capital expenses from an expired grant, using other funds available. Continuation of positions funded from expired grants requires approval by the Board of Supervisors. Grantees are encouraged to maintain close communication with the grantor agency. Often, grants are expected to continue from year-to-year and grantees anticipate and budget this funding. However, a grantor may fail to notify the County until after the new fiscal year services have commenced that grant funding has been discontinued. This situation would result in grantees having incurred expenditures with no funding source. To protect the County when grant funds are subgranted (pass-through) to other agencies, the contract with the agency should include a statement that "payment for services is contingent upon receipt of grant funds." 6

7 Attachment A YUMA COUNTY GRANT REVIEW FORM Form Initiator: Department/Division: Date prepared: Telephone: Grantor: Grant Title: Grant Term: From: To: Grant review needed by New Grant Fund no/dept no: Revenue code: (To be assigned by Financial Services if new) Amendment No. (Increase $ /Decrease $ ) Briefly describe purpose of grant: If amendment, provide reason:: If this is a mandated service, cite source. If not mandated, cite indications of local customer support for this service. Funding Sources Federal Funds State Funds County Funds Other Total Current Fiscal Year Remaining Yrs Total Revenue Source of County funding (match) if needed (include department name, fund and department number): Federal Catalog of Federal Domestic Assistance (CFDA) No.: Method of collecting grant funds: Lump sum payment Quarterly payments Draw Reimbursement Is revertment of unexpended funds required at end of grant period? Yes No Cost of Services Direct Indirect Total Current Fiscal Year Remaining Years Total Cost Does Grantor accept indirect costs as an allowable expenditure? If yes, dollar amount or percentage allowed: Number of new positions that will be funded from grant: Number of existing positions funded from grant: Other County agencies impacted: Does the Agency Head accept all terms of the County=s Grants Management Policy? Yes No If not, which exceptions should be made and why: ATTACH APPROPRIATE DOCUMENTATION (COPY OF GRANT, AMENDMENT, GRANTING LETTER, EXPLANATION/JUSTIFICATION) REVIEW BY FINANCIAL SERVICES IS REQUIRED FOR ALL NEW GRANTS, RENEWALS & BUDGET AMENDMENTS Budget revision required Matching funds identified & available Indirect costs identified Comments: Signature/Date: REVIEW OF NEW GRANTS BY COUNTY ATTORNEY Approved as to form Yes No Comments: Signature/Date: REVIEW BY COUNTY ADMINISTRATOR Recommend Board: Approve Disapprove Comments: Signature/Date: 7