September 20, 2012 FP (Via Only)

Transcription

1 Memorandum September 20, 2012 FP (Via Only) TO: FROM: SUBJECT: Chief Business Officers Facilities Directors Other Interested Parties Frederick E. Harris, Assistant Vice Chancellor College Finance and Facilities Planning Updated Project Closeout Procedures State administrative regulations require that all projects financed with state bonds comply with Project Closeout procedures. The Chancellor s Office last issued Project Closeout procedures in a December 2008 memo. This communication supersedes the December 2008 memo and revises the Project Closeout procedures in response to communications received from the Office of State Audits and Evaluations at the Department of Finance (DOF) regarding the 2009 audits of state funded projects. The Project Closeout procedures on state funded projects continue to be administered through the FUSION system. The main objectives of the closeout procedures are to ensure the following: 1) The project is complete with all state funds claimed and all disputes regarding project costs, if any, resolved; 2) The project scope is consistent with that approved by the Department of Finance and the Legislature; 3) FUSION has been updated to show final Project Costs per the JCAF 32 and final Quarterly Report; 4) The final JCAF31 in FUSION is consistent with the project as depicted in the district s certified Space Inventory; and 5) The district followed Public Contract laws and regulations in the construction of the project. PC Handout # 1

2 The procedures detailed below will ensure that projects are closed out in compliance with state requirements. Once projects have the appropriate closeout documentation, the projects can be removed from the FUSION Project module and the district s five year plans. All projects will remain in the FUSION Project module until all project closeout documentation as detailed below has been received by the Chancellor s Office. CLOSEOUT PROCEDURES There are two phases in the Project Closeout process involving two Change Requests in the FUSION Project module. 1) Project Online Change Request: Formal notification from the district that the facility is Online (i.e. occupied/in use) and the space created by the project, if any, included in the district s Space Inventory. 2) Project Completed Change Request: Formal notification from the district that the project is Completed, i.e. all state funds have been claimed, all disputes resolved, and the district has received a Certification & Close of File letter on the project from the Division of the State Architect (DSA). 1) Project Online Change Request Create a new change request in the FUSION PROJECT module. Designate project as Online by clicking the Online box in the project s title screen. Revise the JCAF31 to reflect the final project space. This should be consistent with the project space entered into the district s Space Inventory (note: this final JCAF31 will provide a record of the project space. FUSION will remove the space from the district s 5-Year Plan when the Change Request is approved). Attach a side-by-side comparison of the project space as approved at Working Drawings and as entered into the JCAF31 and the district s Space Inventory. Attach a copy of the Notice(s) of Completion to the Change Request. Submit the Change Request to the Facilities Planning Unit (FPU) for approval. the district s FPU Specialist to alert them that a Change Request is pending approval. 2) Project Completed Change Request The district cannot submit a Change Request in FUSION to show the project as Completed until: 1. Any costs in conflict between the district, state, and/or other parties have been resolved; PC Handout # 1

3 2. The district has finished its efforts to seek state reimbursement of expenditures from the state; 3. The project fiscal accounts at the state level can be closed and any remaining funds can be reverted; and 4. The district has received DSA s Certification & Close of File letter on the project. Project Completed Procedures: Create a Change Request in the FUSION PROJECT module. Designate the project as Completed by clicking the Completed box in the project s title screen. Attach a letter on district letterhead to the Change Request certifying: o the project is complete and all reimbursement claims are settled; o the project was constructed as approved by DOF and the Legislature and as depicted in the district s certified Space Inventory Report (if applicable); and o the district followed Public Contract law in the construction of the project. Revise the JCAF32 to reflect actual project costs (both state and local) and the actual project calendar. Complete the Final Quarterly Report for the project. The project costs should be consistent with the Final JCAF32. Check that the JCAF32 costs and the Quarterly Report costs are consistent with the Claims shown in FUSION. Attach the following PDF files to the Project Completed Change Request: o DSA Certification & Close of File letter; o DSA 6 forms (including: DSA6; DSA6 A/E; and DSA-168); o Space Inventory Report 17 page(s) from the district s latest certified Space Inventory; and o Final list of equipment purchased (for projects receiving release of equipment after 6/1/2012). Submit the change request to FPU for approval. the district s FPU Specialist to alert them that a Change Request is pending. A sample Project Closeout package has been posted to the Chancellor s Office website (Project Closeout). The package includes an example of a project closeout letter, sideby-side comparison, and final equipment list as well as all the other forms previously discussed. Please call your FPU Specialist if you need assistance compiling the Project Closeout package. PC Handout # 1

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5 State Funded Project Closeout Checklist College Name CFIS: 40.xx.xxx Project Name: DSA# 11xxxx Date Uploaded in Checklist of Needed Documents Phase I Fusion Side-by-side comparison (comparing project space as approved at WDs 1 and as entered into the JCAF31 and Space Inventory. 2 Notice of Completion* Checklist of Needed Documents Phase II Formal correspondence certifying that the project is complete and all 3 reimbursement claims are settled. 4 DSA 6-AE 5 DSA 6-C (Contractor) 6 DSA 6-PI (Project Inspector) 7 DSA DSA Certification & Close of File 9 Space Inventory Report 17 Final list of purchased equipment (only for projects receiving release of 10 equipment after 6/1/2012) *projects using multi-prime delivery method need to attach all NOCs from all contractors. Comments/Status PC Handout # 3

6 Action 1 Update Space Inventory. PHASE I - "Online" Change Request Date completed Create a change request in the Project Module and check the "Online" Box. Revise the JCAF31 to reflect final project space - revise the JCAF31 in the Project Module in FUSION (please do NOT zero out the project space in the Project Module). Create a side-by-side space comparison - comparing project space as approved at Working Drawings and as entered into the JCAF31 and the district's Space Inventory. Upload the side-by-side comparison in FUSION to the online change request. Upload the Notice of Completion in FUSION to the online change request.* Submit the Online Change Request - our specialist alerting the state that we submitted an "online" change request. PHASE II - "Completed" Change Request Action Create a change request in the Project Module and check the 1 "Completed" Box. Date completed Draft and send formal letter certifying that the project is complete and all reimbursement claims are settled. Upload the letter in FUSION to the completed change request. JCAF32 in FUSION needs to be revised to reflect actual project costs (state and local) and the actual project calendar. Submit the final Quarterly Report reflecting final costs.the Quarterly Report should be consistent with the JCAF32 in FUSION. DSA 6 Forms including: DSA 6-AE; DSA 6-C; DSA 6-PI, and DSA-168 uploaded in FUSION to the completed change request. DSA Certification & Close of File letter uploaded in FUSION to the completed change request. Space Inventory Report 17 page(s) from district's latest certified Space Inventory. Final list of equipment purchased (for projects receiving release of equipment after 6/1/12) Submit the Completed Change Request - our specialist alerting the state that we submitted a "completed" change request. PC Handout # 3

7 Dear XXXX: The district has completed the Project Name (40.XX.XXX). I certify the following: the project is complete and all state reimbursement claims are settled; the space was constructed as approved by the Department of Finance and the Legislature and as depicted in the district s certified Space Inventory Report; the district followed Public Contract law in the construction of the project; and per the State Treasurer s Office, the district will retain all project financial records for a period of no less than 35 years, including DF14D forms, expenditure records, and claims information. We have submitted a Change Request(s) in FUSION with the following: 1. DSA6 Forms - (DSA6; DSA6 A/E; and DSA-168); 2. DSA Certification and Close of File Letter; 3. Revised JCAF 31 showing final project space; 4. Side-by-Side comparing JCAF 31 at approval of working drawings and the project as shown in the district s space inventory; 5. Space Inventory Report 17 page(s) for the project building(s) from the district s latest certified Space Inventory; 6. Revised JCAF 32 showing final project costs; 7. Final Quarterly Report; 8. Notice of Completion; and 9. Final list of equipment purchased. Sincerely, Chief Business Officer or Designee PC Handout # 4

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25 How long must records be retained? For IRS audit purposes, records must be retained until at least three years after the bonds issued to finance the projects are paid off. Since most GO bonds are issued with a 30-year final maturity and since there can be a period of time between when a department disburses funds from its PMIA loan account and when that expenditure is included in a bond sale, the STO requests that departments retain records for 35 years after the date of expenditure. What records must be retained? following: Records that should be retained include the 1. Documentation evidencing the expenditure of all GO bond funds, including the following: (a) the timing and amount of the expenditures on the projects; (b) the person to whom the payment was made; (c) whether the transfer of funds was a grant, loan or direct expenditure; (d) the asset financed by the transfer of funds and its expected useful life; and (e) the amount and timing of any grant repaid to the department. 2. Documentation evidencing private activity use of bond-financed assets, including the following: (a) any private ownership, leasing, or other private use contracts relating to the financed assets; (b) any private payments received with respect to the assets; and (c) the amount loaned to a nongovernmental entity. Note: private activity use documentation does not need to be maintained for grants. In what format must the records be kept? Records may be maintained in a hard copy format or an electronic format (if certain requirements are satisfied). The IRS' general requirements for an electronic storage system are as follows: 1. The system must ensure an accurate and complete transfer of the hardcopy books and records to the electronic storage system and contain a retrieval system that indexes, stores, preserves, retrieves, and reproduces all transferred information. 2. The system must include reasonable controls and quality assurance programs that: (a) ensure the integrity, accuracy, and reliability of the system; (b) prevent and detect the unauthorized creation of, addition to, alteration of, deletion of, or deterioration of electronically stored books and records; (c) institute regular inspections and evaluations; and (d) reproduce hardcopies of electronically stored books and records that exhibit a high degree of legibility and readability. 3. The information maintained in the system must be cross-referenced with the department's books and records in a manner that provides an audit trail to the source document(s). (Records Retention Information How long records must be kept, what records must be kept, and what format records must be kept) PC Handout # 13