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1.0 General Information

1.1 Statutory Reference

See: CGS Sections 3-39a, 4-28, 4-29, 4-31, 4-31a, and 13a-166.

1.2 Fringe Benefits and Indirect Costs

Federal and Other Than Federal appropriations in the Grants and Restricted Accounts Funds should be charged with their appropriate share of fringe benefits and indirect costs. The procedures for determining and applying overhead and fringe benefit rates are contained in the Comptroller's Indirect Cost and Fringe Benefit Recovery Procedures Manual.

Questions and requests for assistance should be addressed to the OSC/ Budget and Financial Analysis Division of the Comptroller's Office.

2.0 Grant Types and Coding

2.1 Unrestricted Private Grants

All grants from private sources received without restriction become General Fund revenue unless there is specific statutory authority to the contrary. This is true whether the sums are to promote special activities or for the general benefit of the state. All such grants received are to be deposited in the General Fund using Revenue Account 45620.

2.2 Federal Grant General Information

Federal grants, whether to reimburse the State for specific expenditures that were made from budgeted General Fund appropriations, or to encourage specific programs or projects, become General Fund revenue unless there is specific statutory authority to the contrary.

The federal government awards grants to the state for a particular purpose or for a specific project. When received, Federal grant funds are appropriated and allotted by the Office of Policy and Management, and then may be expended by the receiving agency for the purpose of the grant or contract.

In order to insure accurate reporting of federal grant expenditures by the Comptroller, and to facilitate compliance with the Federal Single Audit Act and the Federal Cash Management Improvement Act, separate appropriation SIDs must be maintained for each federal grant or federal program. Federal programs are identified by the Catalog of Federal Domestic Assistance (CFDA) number assigned to each grant award. Multiple year grants do not require a separate SID for each year, yearly awards may be commingled in a single SID. A separate budget reference may be used to distinguish between grant periods.

It is the responsibility of the receiving agency to comply with all grant terms and conditions and to file any necessary program or fiscal reports.

2.2.1 Discretionary or Competitive Federal and Private Grants

Agencies are required to notify the Office of Policy and Management of their intent to apply for such funds. Notification must be provided using the automated system. Paper "Notification of Intent" forms will not be accepted.
See for further instructions.

2.3 Federal Funding Types

2.3.1 Advance Funding by Federal Government

For many grants the federal government advances funds on a monthly, quarterly, or annual basis to finance the grant activities.

The procedures required are as follows:

A. Request a Grant Appropriation Code (SID) from OSC/ Budget and Financial Analysis Division of the Comptroller's Office. The SID will be in the 20050 series. See Paragraph 5.0 for instructions. Each SID should contain only one federal program as identified by the CFDA number.

B. Deposit federal funds to Revenue Account 45020.

C. Process encumbrances and expenditures for grant funds in the same manner as other appropriations. For further instructions:

2.3.2 Federal Receivables

When the federal grant or contract provides for reimbursement after expenditures, CGS 3-39a and 13a-166 provide for the establishment and allotment of appropriations prior to receipt of federal funds.

The procedures required are as follows:

A. Request a Grant Appropriation (SID) code from OSC/ Budget and Financial Analysis Division of the Comptroller's Office. The SID will be in the 20050 series. See paragraph 5.0 for instructions. Each SID should contain only one federal program as identified by the CFDA number.

B. Secure Office of Policy and Management (OPM) approval for the receivable.

Prepare a "Grant Award Report", and forward to OPM along with the grant award (or other written commitment) for their approval.

If approved by OPM, the Grant Award Report and grant award will be forwarded to OSC/ Budget and Financial Analysis Division of the Comptroller's Office where the award will be appropriated and allotted.

The grantor commitment must be in a "form acceptable to the Comptroller" (CGS Sec. 3-39a).

C. Process encumbrances and expenditures

Once an award is allotted, encumbrances and expenditures are processed in the normal manner.

For more instructions: Receivable Record

Upon approval of a receivable, agencies should establish a receivable record to track both receipts and expenditures (this may be a monthly summary entry). This record will indicate both the remaining receivable (original receivable less cumulative deposits) and the amount of the receivable which is currently collectible (cumulative expenditures less cumulative deposits). Deposit of Receipts Against Receivables

Agencies should request reimbursement by the federal government for expenditures as frequently as allowable. The Comptroller monitors collections versus expenditures on receivables and will contact any agency which appears to be lax in securing federal reimbursement

Agencies should not record grant receipts with the Revenue Account 46200 (Other Refunds). This understates state grant receipts and expenditures. The use of this coding for grant receipts negatively impacts statewide reporting. The OSC/ Budget and Financial Analysis Division of the Comptroller's Office periodically reviews the grant refunds; agencies who are coding these refunds incorrectly will be notified to correct the posting. The following link provides additional information on grant processing.

2.3.3 Letter of Credit Grants

A federal letter of credit is a commitment certified by an authorized official of a federal program agency, specifying a dollar limit available to a designated grantee (i.e., state agency). It is used in federal programs requiring large advances of cash to state agencies, enabling the agency to withdraw cash from the U. S. Treasury concurrently with disbursements and as frequently as such disbursements are made by the agency.

The grantor federal agency is responsible for developing instructions and reporting and internal operating procedures for state agencies relating to letters of credit and will monitor the state agency's use of the funds. State agencies will be advised of and shall comply with the federal agency's requirements in connection with advance funding.

Generally, the state agency commits itself to:

(l) initiating cash drawdowns only when needed to meet actual disbursements and in minimum amounts necessary for immediate disbursement needs;

(2) the timely reporting of cash disbursements and balances as required by the federal program agency; and

(3) the imposition of these same standards upon any secondary recipients (entities receiving federal funds advances from the state agency�commonly local governments).

The procedures required are as follows:

A. Request a Grant Appropriation (SID) code from OSC/ Budget and Financial Analysis Division of the Comptroller's Office. The SID will be in the 20050 series. The grant title and appropriation code (through SID) should be placed on all "Grant Awards" and "Letters of Credit" processed under the following paragraphs. Each SID should contain only one federal program as identified by the CFDA number.

B. Send the original copy of the letter of credit and one copy of the grant award to the State Treasurer.

C. Secure an appropriation and allotment

Send two copies of the grant award and/or letter of credit to the Office of Policy and Management (Budget and Management Division) along with an Allotment Request (B-107). The agency must request an allotment for the entire grant. The Office of Policy and Management (if acceptable to them) will approve the grant award and process the B-107.

When approved, the B-107 will be forwarded to OSC/ Budget and Financial Analysis Division along with the approved grant award and/or letter of credit. OSC/ Budget and Financial Analysis Division of the Comptroller's Office will establish an appropriation, allotment and a grants receivable for the amount of the award.

D. Process encumbrances and expenditures

Once the allotment is posted, encumbrances and expenditures may be processed in the usual manner. Drawdowns Against the Letter of Credit (45020)

Federal programs subject to the Cash Management Improvement Act of 1990 (CMIA) have funding techniques set by the Treasury-State Agreement. The funding technique described in that agreement defines when the drawdown is to take place. All drawdowns for CMIA covered programs must be in compliance with the funding technique outlined in the agreement to avoid payment of interest to the federal government. If there is any question regarding compliance with CMIA please call OSC/ Budget and Financial Analysis Division at 860-702-3352.

Programs below the state's threshold are not subject to the interest provisions of CMIA and are not included in the Treasury-State Agreement. Under CMIA regulations, cash advances for these programs are limited to the actual, immediate cash requirements of the state.

Note: For assistance with Fund, SID, and Revenue Account information, please contact the OSC/ Budget and Financial Analysis Division at 860-702-3352.

For assistance with Bank information, please call the Office of the Treasurer, Cash Management Division, 860-702-3130.

2.4 Other than Federal Grants - Restricted

2.4.1 General information

This section covers gifts, donations, grants, and contracts restricted to a particular purpose or project from sources other than the federal government. It also covers restricted accounts funded by receipts, the use of which is limited by law or otherwise to a particular purpose, and where use of a special fund is not required.

2.4.2 Procedures

The procedures for private grants or accounts are identical to those outlined in paragraph 2.3.2 for federal grants with one exception:

A. Receipts should be coded to revenue account 45500.

2.5 Other Than Federal Receivables

When necessary, and subject to the approval of the Office of Policy and Management and acceptance by the Comptroller, receivables may be established for non-federal grants in the same manner as for federal grants. These grants will follow the same procedures as outlined in paragraph 4.4 for federal receivables with one exception:

A. Receipts must be coded to Revenue Account 45500.

3.0 Transfers of Grants Between State Agencies

3.1 Definition

Transfers of grants refer to the giving of a grant to another state agency or between two appropriations of a single agency similar to giving a grant to an outside agency. This involves the passing of authority to make expenditures as contrasted with the payment to another for goods and services (purchase and sale) or an inter-agency rearrangement of expenditures (corrections or temporary financing).

Grants between agencies will normally be evidenced by the same documents or items as any grant:

A. Grant award
B. Program and fiscal reports
C. Return of unexpended balances

3.2 Grant Transfer Coding

Grant transfers (GT's) as defined in this section occur only in funds 12060 and 12062 (other transfers may occur, but the procedures in this section apply exclusively to transfers within either Fund 12060 or Fund 12062).

The agency receiving the transfer of funds uses one of two revenue codes: 47100 for federal grant transfers and 47200 for non-federal grant transfers. For grant transfer receipts that are not within Fund 12060 or 12062, Account 47300 may be used.

The agency executing the payment of the transfer within Fund 12060 or 12062 should always use expenditure Account 55110 on the voucher side when they process the transfer of federal or non-federal grants. Use of the correct revenue and expenditure coding will prevent the double counting of funds in statewide reporting.

If the grant transfer is not within Funds 12060 and 12062 the expenditure Account 55120 should be used. This is not considered to be a grant transfer for central accounting purposes. OSC monitors the use of Account 55120 and if used improperly the agency will have to make the correction with a journal voucher or spreadsheet journal. For pass thru grants to higher educational agencies use account 55120 on the payment side and account 55120 for the return of unspent grants on the deposit side by the receiving department.

For unspent grant transfer dollars that are being returned to a department within the restricted grant funds (12060 and 12062), the bill type for the return of such unspent grant funds will be "ET" (remember this applies only to dollars that were initially received as intra-fund --12060 and 12062-- grant transfers as described above):

1.) On the payment side, the expending department must use Expenditure Account 55040 "Grant Funds Returned/Grant Refunds". The receiving department must take the credit to Account 55110 "Transfer Grant State Agency".

For all other unspent grant funds that are not to and from Fund12060 or12062, use Account 55080 "State Aid Grants-State Agency on the payment side and credit Account 55120 "Transfer Grant Expenditure State Agency" on the deposit side. The state auditors will be monitoring agency grant transfer transactions to ensure proper compliance with the provisions of the memorandum.

3.3 Grant Transfers Financed From State Tax Exempt Bonds

To enable the State Treasurer to comply with Public Act 88-258 and the Federal Tax Reform Act of 1986, all inter-agency and intra-agency grant transfers that are financed by State of Connecticut Tax - Exempt Bonds (i.e. from the fund giving the grant) are credited to the Grants - Tax-Exempt Proceeds Fund 12021. These grants are not to be credited to the General Fund grant accounts or any other fund.

The following procedures apply:

A. The receiving agency should request an appropriation account number (SID) by memorandum to OSC/ Budget and Financial Analysis Division. The memorandum should indicate the grantor agency and the source of funding. Copies of the memorandum should be sent to State Treasurer and the Office of Policy and Management (OPM).

B. Once an acknowledgment and the assigned SID coding is received from OSC/ Budget and Financial Analysis Division, the transfer may be made.

C. The transfer is made in the same manner as other grant transfers.

D. Once the grant is appropriated and allotted in the 12021 Fund by the transfer, commitments and expenditures may be made in the normal manner.

4.0 Closing Grants

4.1 General information

Grants, whether federal or other than federal, must comply with restrictions imposed by the grantor. Within these restrictions the agency should monitor these grants so that they may be terminated when the goals of the grant have been accomplished or the time limits of the grant have expired. These grants are continuing appropriations and remaining balances will remain on the state's books until positive action is taken by the agency concerned.

4.2 Lapsing of Balances

If the terms of the grant permit, the remaining balance in a complete grant should be lapsed. This is accomplished by sending a memorandum to the OSC/ Budget and Financial Analysis Division stating that the grant has been terminated and the balance of $ _____ may be lapsed into the resources of the General Fund.

4.3 Return of Funds to Grantor

If the terms of the grant do not permit the lapsing of balances, then any remaining balance in the grant should be returned to the grantor or disposed of in accordance with the grant (some federal grants permit balances in a terminated grant to be transferred to another federal grant).

Funds are returned by processing a voucher payable to the grantor for the balance to be returned. The expenditure should be coded to Expenditure Account 55040, Grants Funds Returned.

4.4 Cancellation of Receivables

If a balance remains on a grant receivable at the end of the grant, an adjustment of receivables should be processed cancelling the remainder of the receivable.

4.5 Cancellation of Appropriation Code (SID)

Grant appropriation accounts which have all zero balances and no activity for two fiscal years are deleted from the accounting system at the end of the second year by OSC/ Budget and Financial Analysis Division.

5.0 Requesting Grant Appropriation Codes (SIDs)

5.1 General Information

All requests for a special identification code (SID) must be in writing. The following specific instructions apply.

A. Submit a separate request for each grant or program in duplicate.

B. The name of the grant or program.

C. The description of the program should be as brief as possible. Provide only as much information as necessary to determine the correct code to be assigned.

D. All requests for federal awards must include the Catalog of Federal Domestic Assistance number. This is a five digit code (XX.XXX) which should appear on the grant award. Each SID should be for one federal program with one CFDA number.

E. If the source of funding is another state agency you must enter that agency's coding. The "another state agency" may be your own agency where you are a "prime" grantor making grants to other state agencies as well as to yourself.

Your request with the assigned code (s) will be returned.

5.2 Multiple Year Grants

A separate SID is not required for each year of a multiple-year award. Agencies should separate grant years internally on their own records or through chartfield coding whenever possible, resulting in less work and increased flexibility for all concerned

6.0 Fiscal Year End Grant Procedures

Restricted grant accounts do not lapse at the end of the fiscal year.

On the appropriation account, the unallotted, unencumbered, and unliquidated encumbrance's balances will be continued into the next fiscal year.

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