TEMPORARY ASSISTANCE FOR NEEDY FAMILIES (TANF) U. S. Department of Health and Human Services
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1 APRIL TEMPORARY ASSISTANCE FOR NEEDY FAMILIES (TANF) State Project/Program: AFTER SCHOOL PROGRAMS FOR AT RISK STUDENTS Federal Authorization: State Authorization: Agency Contact Person Program Dean Simpson (919) Agency Contact Person Budget Sarah Barham Budget Director (919) U. S. Department of Health and Human Services Title IV-A of the Social Security Act, as amended by the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA) (Pub. L. No ), and subsequent amendments thereto, and codified at 42 USC , including the Balanced Budget Act of 1997, Public Law PRWORA was signed into law on August 22, 1996, and required State implementation no later than July 1, The statute also afforded the States (other than eligible territories) the opportunity for earlier implementation. In light of that possibility and the extended period necessary to engage in a collaborative consultative process leading to the development of regulations, the ACF issued several Policy Announcements and Program Instructions for State use, primary among them, TANF-ACF-PA-97-1, January 31, These materials and the statute governed State programs until final rules took effect. During this period, the general standard for judging State behavior was a reasonable interpretation of the statute. On April 12, 1999, ACF published final regulations for the TANF program. These final rules took effect October 1, 1999 (April 12, 1999, Federal Register (64 FR et seq.)). ACF also published technical and correcting amendments to the final rule on July 26, 1999, which were also effective on October 1, 1999 (July 26, 1999, Federal Register (64 FR et seq.)). Thus, the obligations and expenditures of Federal TANF funds on or after October 1, 1999, and any State actions occurring on or after October 1, 1999, are subject to the provisions in the final rules, as amended. TANF is subject to the A-102 Common Rule and OMB Circular A-87. This is in contrast to AFDC, which, as described in Appendix I, was excluded from the A- 102 Common Rule. 108A-25., 108A-25.2., 108A-25.3., 108A-26., 108A-27. through 108A , 108A-29., 108A-29.1., 108A-31., 108A-36., 108A-38., 108A-39. S. L (House Bill 1414) N. C. Department of Health and Human Services Division of Social Services N. C. DHHS Confirmation Reports: SFY 2009 audit confirmation reports for payments made to Counties, Area Programs, Boards of Education, Councils of Government, District Health Departments, DCD State Level Contractors and HRSA Bioterrorism Grant Subrecipients will be available by around late August to early September at the following web address: At this site, page down to Letters/reports/forms for ALL Agencies and click on Audit Confirmation Reports (State Fiscal Year ). Additionally, audit confirmation reports for Nongovernmental entities receiving financial assistance from the DHHS are found at the same website except select Non-Governmental Audit Confirmation Reports (State Fiscal Years ). B
2 The auditor should not consider the Supplement to be safe harbor for identifying audit procedures to apply in a particular engagement, but the auditor should be prepared to justify departures from the suggested procedures. The auditor can consider the Supplement a safe harbor for identification of compliance requirements to be tested if the auditor performs reasonable procedures to ensure that the requirements in the Supplement are current. The grantor agency may elect to review audit working papers to determine that audit tests are adequate. I. PROGRAM OBJECTIVES During the 2001 session, the North Carolina General Assembly authorized the Department of Health and Human Services (DHHS), Division of Social Services (DSS) to award grants to organizations that provide after-school programs for children at risk of teen pregnancy and school dropout. In 2006, gang prevention was also added to the program objective. The grants were awarded to community-based programs that demonstrate the ability to develop linkages with local departments of social services, area mental health programs, schools, and other human service programs. II. PROGRAM PROCEDURES The Administration for Children and Families (ACF), a component of the U. S. Department of Health and Human Services (US DHHS), administers the TANF program on behalf of the Federal Government. To be eligible for the TANF block grant, a state must submit a State plan containing specified information and assurances within the 27-month period prior to the Federal fiscal year in which the funds are to be provided. Funds for the After School Program grants come from the State s Temporary Assistance for Needy Families (TANF) block grant. The TANF block grant is 100% federal funds. Programs that only provide services designed to reduce the likelihood of school dropout and that do not provide teenage pregnancy prevention services will need to determine the income of the families of children. For these programs, TANF regulations require that grant funds can only be used to provide services to children whose family income is at or below 200% of the federal poverty level. Under TANF regulation, teenage pregnancy prevention service as well as school dropout prevention services may be provided only to children that meet certain citizenship requirements. Generally, these regulations require the child to be a U. S. Citizen or a legal immigrant. The TANF After School grants are administered by the North Carolina Department of Health and Human Services, Division of Social Services (DSS). Grants are awarded by the Division of Social Services through a competitive Request for Applications, an assessment of the ability and capacity of the organization to implement community-based programs, and availability of funding. An independent review team is comprised to review and score the applications. The recommendations of this team are forwarded to the Community Based Program Administrator, Child Welfare Services Section Chief, and to the Director of the Division of Social Services for approval. Once this process is completed, a formal award notification is sent to approved applicants. The Division enters into a contract agreement with each agency to provide allowable services. The reimbursement process is used to transfer the grant monies to the recipient. B
3 The signed contract and accompanying certifications describe the federal and State agency requirements to the recipient. The grant money is awarded to community based programs that demonstrate the ability to develop linkages with local departments of social services, area mental health programs, schools and other human service programs. Site visits, desk monitoring, telephone contacts and quarterly reports are the types of monitoring currently done with the projects. TANF funds are 100% Federal, no supplements exist. No policy or procedural manuals were developed. III. COMPLIANCE REQUIREMENTS NOTE: For clarity, each of these compliance requirements is defined individually for the three different types of expenditures: services allowed for TANF under the previous AFDC-EA plan (TEA); child welfare services funded with MOE; and employment and all other allowable services (Work First Program). CROSSCUTTING REQUIREMENTS The compliance requirements in the Division of Social Services Crosscutting Requirements in Section D (DSS-0) are applicable to this grant. A. Activities Allowed or Unallowed Funds may be used in any manner reasonably calculated to achieve the purposes of the program (as specified in 42 USC 601) or any uses authorized for State expenditure under prior Parts A and F, Title IV-A, of the Social Security Act as in effect on September 30, 1995 (42 USC 604(a)(1) and (2). The grants are awarded to organizations that provide after school programs for children at risk of teen pregnancy and school dropout. Compliance Requirement Services provided by and costs allowable under the TANF after school grants are determined by the grantee with the approval of the DSS staff. These authorized services will be documented in the contract narrative and subsequent contract amendments. Audit Objective Ascertain whether agency is providing authorized services/activities. Suggested Audit Procedures Review the contract documents and any amendments to ascertain which activities/services have been authorized by the division of social services. B. Allowable Costs/Cost Principles Compliance Requirement The following requirements relate to the grantee s budget as of the balance sheet date as compared to the budget approved by DSS: The total expenditures may not exceed the contracted amount without prior written authorization of DSS. B
4 No line item will be increased by more than 10% without prior approved budget/contract amendment from the Division of Social Services. Audit Objective To determine whether agency has adhered to authorized budgeting practices. Suggested Audit Procedures Review the operating budget approved by DSS and subsequent revisions. Determine that line items are within the amounts budgeted. All grantees that expend State funds (including federal funds passed through the N. C. Department of Health and Human Services) are required to comply with the cost principles described in the N. C. Administrative Code at 09 NCAC 03M C. Cash Management County Departments of Social Services, non-profit and community-based organizations involved with this project are reimbursed after expenditure. Therefore, no audit testing is necessary with respect to the federal cash management requirements of Part III of the Circular A-133 Compliance Supplement. D. Eligibility In general, services provided under the first and second goals using TANF funds and any of the goals of TANF using MOE funds may only be provided to families that are financially needy (i.e. with incomes at or below 200% of the federal poverty level). Services provided under the third and fourth goals using TANF funds may be provided without regard to income. Under federal TANF regulations, teenage pregnancy prevention services, such as counseling, may be provided to children regardless of their family s income. Programs that only provide services designed to reduce the likelihood of school dropout and that do not provide teenage pregnancy prevention services will need to determine the income of the families of children. For these programs, TANF regulations require that grant funds can only be used to provide services to children whose family income is at or below 200% of the federal poverty level. Under TANF regulation, teenage pregnancy prevention service as well as school dropout prevention services may be provided only to children that meet certain citizenship requirements. Generally, these regulations require the child to be an U. S. citizen or a legal immigrant. E. Equipment and Real Property Management The Equipment and Real Property Management section in the Division of Social Services Crosscutting Requirements in Section D (DSS-0) are applicable to this grant. F. Matching, Level of Effort, Earmarking No matching, level of effort or earmarking was required of the selected projects. G. Period of Availability of Federal Funds Federal funds are available for expenditure by projects during the State fiscal year (July 1 to June 30) for which they are allocated to the projects. B
5 H. Procurement and Suspension and Debarment Procurement The N. C. Department of Health and Human Services (DHHS) and all of its divisions/offices have developed a standard set of rules and regulations that are intended to meet all requirements in conducting day to day purchasing activities. These rules and regulations are set forth in the DHHS Purchase and Contract Manual, Part I (last revised March 2000). Additionally, the following State authorizations apply and are cited by reference in the DHHS Purchase and Contract Manual: (1) N. C. General Statute 143, Articles 3 and 3C, (2) the N. C. Administrative Code, Title 1, Chapter 5, and (3) the State Purchasing Manual. Unless an exception is made in the contract or program agreement with DHHS, all non-governmental subrecipients are required to follow the same guidelines as does DHHS when making procurements for goods and services. All local government sub-recipients are required to comply with N. C. General Statute 143, Article 8 with respect to procurement activities. All grantees that expend federal funds (received either directly from a federal agency or passed through the N. C. Department of Health and Human Services) are required to conform with federal agency codifications of the grants management common rule accessible on the Internet at All grantees that expend State funds (including federal funds passed through the N. C. Department of Health and Human Services) are required to comply with the procurement standards described in the North Carolina General Statutes and the North Carolina Administrative Code, which are identified in the State of North Carolina Agency Purchasing Manual accessible on the Internet at Nongovernmental subrecipients shall maintain written Procurement policies that are followed in procuring the goods and services required to administer the program. Suspension and Debarment The listing of most debarred and suspended parties can be viewed at the following web site: I. Program Income This requirement has not been passed to the subrecipients; therefore, additional testing is not required. J. Reporting A monthly report of budget expenditures is to be submitted to the State Division of Social Services at the end of each month. Expenditures are submitted on the DSS-1571 form. In conjunction with the monthly report, all programs are required to submit a monthly performance report. Compliance Requirement Projects must submit the State required information by the required deadline. Audit Objective Determine whether agency has adhered to reporting requirements. B
6 Suggested Audit Procedure Examine monthly reports to determine if they were submitted in a timely manner. Perform annual site visits and annual desk monitoring to ensure that grant funds are spent in accordance with approved purposes. K. Subrecipient Monitoring Compliance Requirements County departments of social services and community based organizations frequently contract with subrecipients to provide allowable services. Local agencies are responsible for the following (Work First Appendices, Contracting Instructions, Part 4: Monitoring and Management): monitoring to provide reasonable assurance that the contractor complies with State and federal requirements; ensuring that the purchased activity and/or service is being provided in compliance with the written agreement and Division policy; ensuring that Work First block grant funds are expended only for allowable activities and for eligible recipients; requiring contractors to take prompt corrective action where areas of non-compliance are found. B
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