Title Grants Fiscal Handbook is sponsored by Indiana Department of Education. Title Grants Handbook Federal Grants Monitoring Appendix SY24-25 Onsite Monitoring Document <a href="https://

Part 1: Governing Legal Authorities and General Structure of Grant Programs ..................................... 3 Overview of Governing Legal Authorities ................................................................................................. 3 Types of Federal Education Grants ...........................................................................................................

7 Frequently Asked Questions ................................................................................................................... 10 Part 2: Obligations and Liquidations ................................................................................................... 11 Timely Obligations of Funds ....................................................................................................................

11 Liquidations ............................................................................................................................................. 13 Frequently Asked Questions ................................................................................................................... 14 Part 3: Standards for Financial Management Systems ........................................................................

15 Coding Federal Expenditures and Reporting Requirements ................................................................... 15 Internal Controls ..................................................................................................................................... 15 Written Policies and Procedures .............................................................................................................

15 Allowability Review ................................................................................................................................. 16 Part 4: Standards for Procurement Systems ....................................................................................... 17 General Procurement Standards ............................................................................................................

17 Competition ............................................................................................................................................ 20 Methods of Procurement........................................................................................................................

21 Cost and Price Analysis............................................................................................................................ 24 Practical Advice Regarding Procurement Systems ................................................................................. 25 Frequently Asked Questions ...................................................................................................................

27 Part 5: Standards for Inventory Management Systems ....................................................................... 28 Definitions ............................................................................................................................................... 28 Physical Inventory ...................................................................................................................................

29 Control System ........................................................................................................................................ 29 Adequate Maintenance of Equipment.................................................................................................... 29 Trade-in and Sales Procedures ................................................................................................................

30 Use of Equipment.................................................................................................................................... 30 Disposition of Equipment ........................................................................................................................

31 Supplies ................................................................................................................................................... 31 Frequently Asked Questions ...................................................................................................................

32 Part 6: Cost Principles ........................................................................................................................ 33 2 General Cost Principles and Selected Items of Cost ............................................................................... 33 Helpful Questions for Determining Whether a Cost is Allowable ..........................................................

34 Travel Costs ............................................................................................................................................. 39 Indirect Costs ..........................................................................................................................................

40 Frequently Asked Questions ................................................................................................................... 43 Part 7: Time and Effort ....................................................................................................................... 44 Salaries and Wages: Time Distribution Records .....................................................................................

44 Standards for Documentation of Personnel Expenses ........................................................................... 44 Cost Objectives........................................................................................................................................ 45 Review and Adjustment of Budget Estimates .........................................................................................

46 Frequently Asked Questions ................................................................................................................... 47 Part 8: Audit Requirements ................................................................................................................

49 Single Audits ............................................................................................................................................ 49 Resolution Process ..................................................................................................................................

50 Frequently Asked Questions ................................................................................................................... 51 Part 9: Acronym Glossary ...................................................................................................................

52 Disclaimer: Although this document attempts to provide a comprehensive summary of fiscal regulations and statute pertaining to federal funds, this document is not exhaustive and is subject to change. If further state or federal statute or regulatory changes are made, corresponding edits will be made to this living document.

3 Part 1: Governing Legal Authorities and # General Structure of Grant Programs Overview of Governing Legal Authorities As a condition of receiving federal funds, LEAs receiving federal education grants are responsible for complying with many legal requirements.

While most grantees know they must comply with the terms of the specific law under which the grant funds were given, such as Title I, Part A of the Elementary and Secondary Education Act (ESEA), the Individuals with Disabilities Education Act, or the Strengthening Career and Technical Education for the 21 st Century Act, many grantees are not aware of the multitude of other legal requirements and responsibilities that are attached to the receipt of federal funds — often referred to as “grants management” requirements.

In general, federal law is supreme over state law. However, in the context of federal grants, it is fairly common for a federal law to permit a state or local government to follow state or local law, so long as certain threshold requirements are met. Where there is a conflict between federal and state law, the federal law will control unless the federal law in question says otherwise.

The importance of reading the specific laws and rules that govern a particular grant cannot be overemphasized. Hierarchy of Federal Rules The hierarchy of federal rules is as follows: 3. Nonregulatory guidance 4.

Dear Colleague letters 5. Direct communications from U.S. Department of Education (ED) officials Federal statutes are passed by Congress, which is the legislative branch of the federal government. Federal regulations are promulgated, or put into effect by federal agencies, such as ED, within the executive branch of government.

Regulations fill in practical details about how a law will be implemented, and emphasize and clarify areas where an executive branch agency may exercise some discretion. Regulations have the full force and effect of law, meaning that affected parties are required by law to comply with them. To adopt regulations, a federal agency has to go through a formal “rulemaking” process.

The Education Department General Administrative Regulations (EDGAR), which serves as the fiscal regulations that govern federal education funds, are examples of regulations. Federal agencies may also issue nonregulatory guidance that provides additional 4 information about the law in plain-language format. Nonregulatory guidance does not go through a formal rulemaking process.

It does not have the force of law or regulation and is often updated. However, nonregulatory guidance will support IDOE and LEAs in carrying out the programs in a manner that will be considered allowable by an auditor. As with any guidance, the nonregulatory guidance is not all encompassing and often represents examples.

In lieu of new guidance, ED often issues Dear Colleague letters to education stakeholders that describe ED policy interpretations and flexibility options. These letters typically are addressed to stakeholders as a group — such as all chief state school officers or all state Title I directors. Like guidance, these letters do not carry the force of law; however, they are an important indicator of policy trends at ED.

Finally, ED program officials will respond to individual questions via letter, phone, or email. While these direct communications are not considered official policy, they can provide an indication of how ED will address certain programmatic and fiscal concerns. LEAs who seek guidance from IDOE may utilize this information in a similar manner.

1. Statutes: Programmatic and Administrative As the highest controlling authority, statutes are the point at which all administrators should start when trying to learn the formal legal requirements of the programs they administer. There are two basic types of statutes that most Districts will encounter: programmatic statutes and administrative statutes.

Examples of programmatic statutes include the: ● Elementary and Secondary Education Act of 1965, as amended by the Every Student Succeeds Act ● Individuals with Disabilities Education Act ● Strengthening Career and Technical Education for the 21 st Century Act Specific statutory programmatic requirements vary a great deal from program to program.

Administrators are encouraged to read the statutory language to understand the basic program requirements. Basic programmatic requirements can be found in the sister Title Grants & Support handbook, found at www. doe.

in. gov/grants . Programmatic statutes typically contain many different education programs.

For example, the ESEA (as amended by the Every Student Succeeds Act) contains several individual programs, including programs such as Title I, Part A; the Title III English Language Acquisition program; and the 21st Century Community Learning Centers program.

The overarching purpose of a programmatic statute is to establish the particular programmatic requirements of each individual education program, such as: ● How the funds are generated ● How the funds must be allocated 5 ● Who is eligible to be served ● How the program must be designed ● What the permissible uses of funds are ● What types of reports or evaluations are required In addition to these types of programmatic requirements, the statutory language of individual programs often establishes certain program-specific fiscal requirements.

Examples include the “supplement-not-supplant” requirement, mandatory set-asides or administrative caps, and matching requirements. Programmatic statutes, such as the ESEA, often contain certain provisions that are general in nature and apply to all (or most) programs in the statute. For example, a statute may contain a definitions section, a “general provisions” or “uniform requirements” section, and a fiscal requirements section.

These types of requirements are often located in a different part in the statute than the federal education program language itself; however, they may still apply to the federal program in question. Administrative statutes do not address programmatic issues. Instead, administrative statutes outline the basic threshold requirements or processes that apply to federal funds.

One primary administrative statute with which Districts should be familiar is the General Education Provisions Act. The General Education Provisions Act (GEPA) outlines the basic administrative requirements that pertain to most ED programs.

It is important to note that while GEPA establishes the general administrative framework for federal education grant funds, certain programmatic statutes state that some portions of GEPA do not apply to certain programs.

For example, GEPA includes sections regarding single state and local applications for education funds, but the ESEA establishes different application requirements and specifically states that the application sections of GEPA do not apply to consolidated applications under the ESEA.

Therefore, it is essential to check the specific program statute at issue to determine whether the rules outlined in the program statute or the rules contained in GEPA apply in a specific situation. Perhaps the most important general provisions of GEPA for recipients of federal education funds are the following: ● “Forward funding” and the period of performance. GEPA Sections 420 – 421.

● State reporting requirements. GEPA Section 424. ● State agency monitoring and enforcement responsibilities.

GEPA Section 440. ● Single state and local application requirements. GEPA Sections 441 – 442.

● Family Educational Rights and Privacy Act (FERPA) requirements. GEPA Section 444. ● Requirements relating to protection of pupil rights.

GEPA Section 445 ● Enforcement provisions for noncompliance. GEPA Sections 451 – 459. 6 2.

Federal Agency Regulations Regulations are next in the hierarchy of federal rules. Regulations are designed to fill in vague areas within the statute that require federal agency interpretation. For instance, if a statute requires that an appeal be filed “within a reasonable time,” the relevant federal agency may issue a regulation indicating the appeal must be filed within 30 days.

Like statutes, regulations have the force of law and are considered to be binding legal authority. Not all programs have regulations. It is essential to determine whether a specific program has regulations, because compliance with regulations is a condition of receiving funds.

Grantees may encounter such statements as, “This program is subject to EDGAR” since ED designates all of its general administrative requirements collectively as the Education Department General Administrative Regulations. This is simply a shorthand way for the department to indicate that the normal administrative regulations apply to that program.

The regulations in EDGAR contain important administrative requirements that apply to federal education funds. Specifically, EDGAR addresses topics such as the threshold administrative systems that must be in place for recipients of federal grants, application requirements (34 CFR 76. 300 – 76.

304), private school and charter school requirements (34 CFR 76. 650 – 76. 662; 76.

785 – 76. 797), and enforcement requirements (34 CFR 81. 1 – 81.

45), among many others. Many of the concepts laid out in the GEPA statute are further articulated and explained in EDGAR.

In addition to the sections of EDGAR outlined above, ED has formally adopted new administrative requirements, cost principles, and audit requirements issued by the Office of Management and Budget under Title 2 of the Code of Federal Regulations (CFR), including 2 CFR Part 200 – Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (also known as the Uniform Guidance or UGG). 2 CFR Part 3474. 3.

Nonregulatory Guidance Nonregulatory guidance is used by ED to provide informal advice to grantees and subgrantees regarding federal education requirements. Technically, nonregulatory guidance does not have the force of law in the same way a statute or regulation does. However, nonregulatory guidance reflects ED’s most user-friendly interpretation of a statute, as it is generally written in plain-language question-and-answer format.

Moreover, the guidance typically represents policy and flexibility that will be followed by the program offices. In other words, if an LEA complies with the nonregulatory guidance, ED’s program offices generally will not later issue a finding of noncompliance.

However, it is important to recognize that the guidance is not binding on the Department in the same way that statutes or regulations are binding and that program offices occasionally issue multiple versions of guidance on the same subject with different interpretations, or release subsequent versions with changes in interpretation. 7 4.

Dear Colleague Letters from ED ED has increasingly used Dear Colleague letters as a way to communicate significant policy changes or flexibility options to agencies regarding federal law. Sometimes these letters notify recipients of an opportunity to request flexibility through a formal application to ED.

In other cases, these letters simply grant blanket flexibility regarding a legal requirement across the board with no further action required by a grant recipient. Like nonregulatory guidance, letters issued by ED do not have the force of law or regulations.

However, because they are increasingly used to communicate important policy changes or flexibility in how ED is administering a program or interpreting a legal requirement, Districts should ensure that they monitor these letters to keep abreast of recent developments. 5.

Other Communications from ED Officials and IDOE staff The most informal form of federal guidance comes from other correspondence from ED officials and IDOE staff, often addressing single programmatic or fiscal questions. While nonregulatory guidance and generally distributed Dear Colleague policy letters are much more official, individual letters, emails or phone calls with ED officials may signal shifts in ED policy.

However, if information contained in correspondence conflicts with nonregulatory guidance, regulations, or the statute itself, the more official forms of federal policy will always be controlling. Types of Federal Education Grants ED grants may be divided into four partially overlapping types. The first two — state-administered grants and direct grant programs — are distinguished by the lines of grant oversight and accountability.

The second two — formula grants and discretionary grants — are distinguished according to the basis on which the funds are awarded. 8 State-Administered Programs State-administered programs are a special category of ED formula grants and are governed by a distinct set of regulations: Part 76 of EDGAR, State-Administered Programs. Although they are relatively few in number, they are by far the largest ED programs.

Representative state-administered programs include ESEA Title I, Part A; IDEA, Parts B and C; and the Perkins Career and Technical Education formula grant program. A “state-administered program” may be described as one in which the State receives funds by formula from ED. The authorizing statute usually permits the State to use some funds directly, but, for the most part, 34 CFR 76.

50 explains that state-administered programs require the State to pass the money on to eligible grantees (generally Districts) that will actually carry out the programs. Depending on the regulations governing the program, the State may be required to distribute the funds to its subgrantees through formula, by competition, or a combination of the two. 34 CFR 76.

51. All ED grants that are not state-administered programs as defined above are considered direct grants. Direct grants are governed by Part 75 of EDGAR, Direct Grant Programs.

Almost all direct grants are discretionary grants. However, formula grants that are not state-administered programs are also considered “direct grants. ” 34 CFR 75.

1(b). Typically, in a direct grant program, the entity receiving the funds has a direct relationship with ED; funds do not flow through another entity like the IDOE. > Grant Administration Type A formula grant program distributes funds to recipients based on a formula established by law.

As a threshold criterion, eligibility for formula grants is based on the type of recipient (i.e., whether it is an SEA, LEA, IHE, tribe, etc.), but may involve other criteria such as population, poverty level or number of students in special populations (such as homeless students). EDGAR Part 75. 200(c) describes a formula grant program as “one that entitles applicants to receive grants if they meet the requirements of the program.

These applicants do not compete with each other for the funds, and each grant is either for a set amount or for an amount determined under a formula. ” Most major formula programs, such as ESEA Title I, Part A or the Part B and Part C programs under the Individuals with Disabilities Education Act, are also state-administered programs.

Discretionary Grant Programs Discretionary grants, also known as competitive grants, permit the granting agency to exercise discretion over the selection of entities or subgrantees for funding. The criteria for applying for and receiving a discretionary grant are defined by federal education laws and, in some cases, regulations.

Under certain programs, the granting agency (i.e. IDOE) has relatively wide discretion in establishing competitive criteria. As determined by IDOE and applicable laws, McKinney-Vento, 21st Century CLC, and 1003 School Improvement Grant (SIG) funds are administered as discretionary grants.

> Discretionary Grants Formula Grants The following table illustrates examples of each type of grant: State-Administered Discretionary Grants Direct Discretionary Grants • Charter School Program Grants • Small, Rural School Achievement (SRSA) • Some Charter School Program Grants Frequently Asked Question Question: If my District receives federal funding from the Indiana Department of Education for a grant, does this mean my District still has to comply with the federal statutes and regulations?

Answer: If the source of the funding for that grant program is federal dollars, it would be considered a state-administered grant program and your District would need to be compliant with the applicable federal statutes and regulations. The letter from IDOE will be able to tell you this information.

11 # Part 2: Obligations and Liquidations Timely Obligation of Funds Obligations are orders placed for property and services, contracts and subawards made, and similar transactions during a given period that require payment by a Local Education Agency (LEA) during the same or a future period. 2 CFR 200. 71.

An obligation occurs when a public school district or charter school has entered into a binding commitment to pay out money, such as entering into a contract to pay for supplies.

The following table illustrates when funds are determined to be obligated under federal regulations: If the obligation is for: The obligation is made: Acquisition of property On the date which the District makes a binding written commitment to acquire the property Personal services by an employee of the District When the services are performed Personal services by a contractor who is not an employee of the District On the date which the District makes a binding written commitment to obtain the services Public utility services When the District receives the services Travel When the travel is taken Rental of property When the District uses the property A pre-agreement cost that was properly approved by the Secretary under the cost principles in 2 CFR part 200, Subpart E- Cost Principles.

On the first day of the project period. 34 CFR 75. 707; 34 CFR 76.

707. Why does this matter? The activities for a specific program, such as Title II, must be obligated within the project period (e.g. July 1, 2018 through Sept.

30, 2020) and then can be liquidated by December 15, 2020. If the obligation is to occur after the 9/30 date, such as requesting to travel for a conference that occurs in October, then a subsequent year’s funds must be utilized. Period of Performance of Federal Funds All obligations must occur on or between the beginning and ending dates of the grant project.

2 CFR 200. 309. This period of time is known as the period of performance.

2 CFR 200. 77. The period of performance is dictated by statute and will be indicated in the Grant Award Notification (GAN) that IDOE receives from U.S. Department of Education, which is then passed on to the LEAs.

However, there are exceptions to this rule. For direct grant programs, which is when a subgrantee receives funds directly from ED (rare), a grantee 12 may use grant funds only for obligations it makes during the grant period. 34 CFR 75.

703, unless pre-award costs are permitted. 2 CFR 200. 209 and 2 CFR 200.

458. Pre-award costs are activities that occur in anticipation of an award and are necessary and reasonable in relation to the scope of work. State-Administered Grants: For state-administered programs that IDOE administers such as Title I, the obligation clock starts once the State is authorized to begin obligations (i.e., typically July 1) or once the District submits its application in substantially approvable, whichever is later.

34 CFR 76. 708(a). The term “substantially approvable” is not clearly defined; therefore IDOE defines this as when the subgrantee submits a grant application that is complete.

Reimbursement for obligations incurred when a subgrantee is operating under a substantially approved application is contingent on final approval of the application. 34 CFR 76. 708(b).

If the State has discretion to select subgrantees under a program (e.g. competitive grants), it may not allow an applicant for a subgrant to obligate funds until the subgrant is awarded, although the State may approve certain pre-award costs. 34 CFR 76. 708(c).

As a general rule, state-administered federal funds are available for obligation within the year in which Congress appropriates the funds. However, given the unique nature of educational institutions, for many federal education grants, the period of availability is 27 months. Federal education grant funds are typically awarded on July 1 of each year.

While the District will always plan to spend all current grant funds within the year the grant was appropriated (i.e. the first 15 months), the period of obligation for any grant that is covered by the “Tydings Amendment” is 27 months, extending from July 1 of the fiscal year for which the funds were appropriated through September 30 of the second following fiscal year (e.g. July 1, 2018 through Sept. 30, 2020).

This maximum period includes a 15-month period of initial availability, plus a 12-month period for carryover. One example is Title I federal funds. 34 CFR 76.

709. For example, funds awarded on July 1, 2019 would remain available for obligation through September 30, 2021. Program statutes may limit the availability of carryover.

For example, ESEA, Title I, Part A limits a District’s carryover to 15 percent of the grant award. Perkins does not permit any carryover for Districts, rather unspent funds are collected and reallocated by the State after the initial award period. Other programs, like Titles II, III, and IV A do not have a carryover limit and the entire award is available the full 27 months.

Direct Grants: In general, the period of availability for funds authorized under direct grants is identified in the Grant Award Notification (GAN). Most federal funds that LEAs receive are not direct grants, as they first pass through IDOE. However, the Small Rural Schools Achievement program is allocated directly from ED to LEAs, bypassing the IDOE.

Why does this matter? The liquidation period, such as through 12/15, can only pay for activities that occurred by the encumbrance period of 9/30. Furthermore, the ability for a subgrantee to request funds depends upon the date that the grant application was submitted.

However, if the subgrantee applies before the fiscal period starts, i.e. July 1, then the earliest date the performance period can start is July 1. 13 State-Administered Grants As described above, the Tydings Amendment extends the period of availability for applicable state-administered program funds. Essentially, it permits recipients to “carryover” any funds left over at the end of the initial 15-month period into the next year.

These leftover funds are typically referred to as carryover funds and continue to be available for obligation for an additional 12 months. 34 CFR 76. 709.

Accordingly, the District may have multiple years of grant funds available under the same program at the same time. For example, a subgrantee on July 1 will receive new funds, whereas they are in the carryover period for both last year and two years ago. Direct Grants: Grantees receiving direct grants are not covered by the 12-month Tydings period.

However, under 2 CFR 200. 308, direct grantees enjoy unique authority to expand the period of availability of federal funds. The District is authorized to extend a direct grant automatically for one 12-month period.

Prior approval is not required in these circumstances; however, in order to obtain this extension, the District must provide written notice to the federal awarding agency at least 10 calendar days before the end of the period of performance specified in the award. This one-time extension may not be exercised merely for the purpose of using unobligated balances.

Districts must seek prior approval from the federal agency when the extension will not be contrary to federal statute, regulation or grant conditions and: ● The terms and conditions of the Federal award prohibit the extension; ● The extension requires additional Federal funds; or The extension involves any change in the approved objectives or scope of the project. 2 CFR 200. 308(d) (2).

Why does this matter? The period of performance for federal grants is not determined by IDOE but rather by ED. Therefore, subgrantees must ensure expenses are obligated and liquidated per the respective dates in order to avoid forfeiture of funds.

After obligations are incurred, the obligation must be funded or paid for — a process known as “liquidation. ” In its most basic form, liquidation consists of the grantee or subgrantee writing a check to a vendor or paying an employee and then drawing funds from IDOE.

For both state-administered and direct grants, regardless of the period of availability, an LEA must liquidate all obligations incurred under the award not later than 90 days after the end of the funding period unless an extension is authorized. 2 CFR 200. 343(b).

IDOE allows for a liquidation period as close to the 90 days noted in the Uniform Guidance as is administratively feasible. Any funds not obligated within the period of availability or liquidated within the appropriate time frame are said to lapse and must be returned to the awarding agency, usually the IDOE. 2 CFR 200.

343(d). Consequently, Districts should closely monitor grant obligations and spending throughout 14 the grant cycle. More information of the deadlines for liquidations (and possible extensions) can be found here .

Why does this matter? The activities for a specific program, such as a trauma-informed training for Title IV, must occur within the project period (e.g. July 1, 2018 through Sept. 30, 2020) and then can be liquidated, or paid out, by December 15, 2020.

The grantee will also have to request reimbursement from IDOE for these funds by December 15, 2020. If funds are not requested by this date, they will lapse and will be returned to IDOE. Frequently Asked Questions Question : How do obligating funds for travel work?

Answer: According to 34 CFR 75. 707 and 34 CFR 76. 707, travel obligates when the travel is taken.

This means that for booking a flight or hotel, travel does not obligate on the date of booking, but rather on the date of the flight or hotel stay. Because Districts still need to find a way to pay for the travel when booking, it is recommended to initially charge these costs to nonfederal funding, and then, once the travel is taken, do whatever necessary accounting processes to move the costs to federal funds.

Question: When would funds for registering for a conference obligate? Answer: Oftentimes, it is necessary to register for a conference well in advance in order to secure a spot. In these circumstances, the registration costs would be considered to obligate on the date the District made the binding commitment to register for the conference.

The District should maintain documented evidence demonstrating why it was necessary to register in advance. However, the remaining costs associated with travel (tickets, per diem, etc.) must be obligated through funds that currently have an open period of performance.

15 # Part 3: Standards for Financial Management Systems Coding Federal Expenditures and Reporting Requirements The Indiana State Board of Accounts (SBOA) guidance is used to ensure integrity and accountability of funds. Furthermore proper coding of expenses allows for IDOE to calculate Maintenance of Effort (MOE), which is a requirement of receiving federal funds.

For example, an LEA has to spend 90% of the year prior in state and local funds, in aggregate or per-pupil, in order to avoid a penalty that would reduce ESSA funds proportionally. Proper coding also ensures that the per-pupil expenditures at the building level are reported accurately, which is another condition of receiving federal funds.

For further information on the classification of expenditure accounts and object codes, visit this website . Internal controls are policies and procedures meant to ensure the integrity of accounting and other information, and to promote accountability while preventing fraud.

Internal controls can usually be satisfied by ensuring multiple individuals are involved and sign off on a procedure, such as making a purchase or submitting data to an agency, and having detailed, backup documentation to be able to demonstrate what occurred. Written Policies and Procedures Effective and well-written policies and procedures are essential for record keeping and tracking federal funds.

The following table illustrates citations for written policy and procedure rules: Policy or Procedure Citation of Written Policies and Written Cash Management Procedure 2 CFR § 200. 302(b)(6) and 200. 305 Written Allowability Procedures 2 CFR § 200.

302(b)(7) Written Conflict of Interest Policy 2 CFR § 200. 318(c) Written Procurement Procedures 2 CFR § 200. 319(c) Written Method for Conducting Technical Evaluations of Proposals and Selecting Recipients Written Travel Policy 2 CFR § 200.

474(b) Procedures for Managing Equipment Time and Effort Section 5 of the Cost Allocation Guide 16 The Indiana Department of Education reviews submitted grant applications and budgets to ensure proposed expenditures are reasonable, allocable (able to proportionally charge to a grant), and necessary (RAN) in order to carry out the stated goals and objectives. Any proposed expenditure must meet all three to be considered.

The below graphic contains guiding questions that IDOE utilizes to ensure all expenditures meet the RAN test. LEAs may wish to utilize this information to prepare budgets and grant submissions. Reasonable Allocable Necessary Is this project reasonable to the performance of the grant award?

Will this project directly advance the work or performance of the award? Is the project necessary for the operation and efficient performance of the grant? Is the project justifiable to a prudent reviewer?

Will denial of this project activity hinder the implementation and outcomes of the grant? Does the project conform to any limitations or exclusions of the grant regarding type or cost? Is this project tied to an identified need?

Will this project primarily benefit the intended group? Will this project provide additional support or service? 17 # Part 4: Standards for Procurement Systems Another threshold system that recipients of federal funds must