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4120 Administration Expenditures

Title IV-E Finance Handbook for County Contracts August 2009

Costs directly related to the administration of the foster care program are deemed allowable if they are:

  •  necessary and reasonable;

  •  incurred while providing proper and efficient services to children who are eligible under Title IV-E; and

  •  are in accordance with OMB Circular A-87, 45 CFR §95.507, and 45 CFR §1356.

The following services are examples of administrative activities allowable under Title IV-E. See 45 CFR §1356.60(c)(2):

  •  Referral to services

  •  Preparation for and participation in judicial determinations

  •  Placement of the child

  •  Development of the case plan

  •  Case reviews

  •  Case management and supervision

  •  Recruitment and licensing of foster homes and institutions

  •  A proportionate share of related DFPS overhead

  •  Costs related to data collection and reporting

Allowable administrative costs under Title IV-E are reimbursable at 50 percent and may include:

  •  salaries;

  •  fringe benefits;

  •  travel;

  •  supplies;

  •  equipment; and

  •  other operating expenses.

Salaries and Fringe Benefits

The salaries and fringe benefits paid to county personnel for time spent performing Title IV-E activities are reimbursable.

Fringe benefits include, but are not limited to:

  •  Federal Insurance Contributions Act (FICA) tax paid by the county;

  •  insurance;

  •  retirement; and

  •  workers’ compensation.

The distribution and apportionment of salaries and wages must be in compliance with OMB Circular A-87 and in accordance with the county’s approved budget.

Unallowable Costs

The costs of social services that provide counseling or treatment to a child, the child’s family, or the child’s foster family to ameliorate or remedy personal problems, behaviors, or home conditions are not reimbursable administrative costs. See 45 CFR §1356.60(c)(3).

Administrative Travel

Travel costs are limited to the maximum travel reimbursement rates noted by the Texas Comptroller of Public Accounts and are limited to actual travel costs.

Allowable Travel Costs

Costs incurred by county personnel while performing Title IV‑E administrative duties or attending staff development trainings may include:

  •  Meals

  •  Lodging

  •  Auto rental

  •  Gasoline

  •  Airfare

  •  Mileage

  •  Registration fees

  •  Parking

  •  Other incidental expenses (taxi fees, tolls)

Unallowable Costs Related to Travel

  •  Gratuity

  •  Alcoholic beverages

  •  Personal phone calls

  •  Any other items not allowed by federal regulations or not directly connected to the Title IV-E program

Supplies

The costs of supplies that are reasonable and necessary to administer the Title IV-E program are reimbursable. Purchases are charged at their actual cost after deducting all cash discounts, rebates, and allowances received. Supply costs may include items not capitalized under the county policy. (For procedures related to capitalization thresholds, see the section on Equipment, below.)

Equipment

The cost of equipment deemed reasonable and necessary to administer the Title IV-E program is reimbursable only if it is purchased for employees whose work relates exclusively to Title IV-E.

An item is considered to be equipment, if the two following conditions exist:

  •  The unit cost is $5,000 or more.

  •  The estimated useful life of the item is more than one year.

See the State of Texas capitalization policy.

Equipment is considered a fixed asset, as opposed to a consumable item, and is therefore considered capitalized. For the purpose of reimbursement through the Title IV-E program, the county’s capitalization policy applies; therefore, if a county’s capitalization threshold exceeds the $5,000 limit set by the state, an item is considered capitalized equipment for Title IV-E purposes if it costs less than the county’s threshold but more than the state’s.

Counties without a capitalization policy apply the state’s capitalization policy.

Other Operating Expenses

Certain other costs that are directly related to the administration of the Title IV-E program are reimbursable. These costs may include but are not limited to:

  •  Telephones (purchase and service costs)

  •  Supplies for life books for children in foster care (life books contain details about significant people and events in a child’s life).

  •  Birth certificates (Before expenses are incurred, the county checks with the DFPS to be sure the expenses are reimbursable. If not paid by the child’s parents, reasonable and necessary costs are paid by DFPS in accordance with CPS PSA 07-057, December 20, 2006.)

  •  Immigration filing fees

  •  Reference materials

  •  Referrals for services

  •  Preparation for and participation in judicial determinations

  •  Placement of the child

  •  Development of the case plan

  •  Case reviews

  •  Case management and supervision

  •  Recruitment of foster homes and expenses for public or community awareness related to recruitment (Appreciation receptions are not reimbursable)

  •  A proportionate share of related overhead

  •  Costs related to data collection and reporting

  •  Insurance and indemnification costs incurred by the county, if the costs are directly related to Title IV-E program administration

4130 Training Expenditures

Title IV-E Finance Handbook for County Contracts August 2009

Title IV-E training costs are the costs associated with attending or participating in Title IV-E approved training. The costs must be specifically related to the Title IV-E program as indicated in Appendix B: Title IV-E Training Topics That the State May Claim as a Title IV-E Match Rate.

Training costs are reimbursable at the enhanced 75 percent match rate only for training designed to prepare DFPS employees and limited other trainees (such as potential employees, foster care parents, institution staff), to carry out the allowable administrative functions as listed at 45 CFR §1356.60(c)(2). The functions are listed at the beginning of 4120 Administrative Expenditures.

Training for other groups, such as the following, is reimbursable at an enhanced rate beginning at 55 percent in federal fiscal year 2009 and increasing at 5 percent a year up to 75 percent in federal fiscal year 2013:

  •  CASA volunteers

  •  Contracted child placement providers

  •  Members of the staff of abuse and neglect courts

  •  Attorneys representing children or parents

  •  Guardians ad litem

  •  Other court-appointed special advocates representing children in court proceedings as specified in the Fostering Connections to Success and Increasing Adoptions Act of 2008

See also the U.S. Department of Health and Human Services (DHHS’s) Child Welfare Policy Manual, Section 8.1H, Title IV-E, Administrative Functions/Costs.

Training provided to prospective county employees is allowable only under limited circumstances. The county must receive approval from the DFPS contract manager before claiming reimbursement for any Title IV-E training costs incurred by a prospective county employee.

Training Salaries and Fringe Benefits

The Title IV-E training salaries and fringe benefits paid to county personnel for the actual time spent attending or participating in Title IV-E training are reimbursable.

Travel Related to Title IV-E Training

Travel expenses incurred by county personnel while attending or participating in Title IV-E training are reimbursable.

Travel costs are limited to the maximum travel reimbursement rates noted by the Texas Comptroller of Public Accounts and are limited to actual travel costs.

See 4120 Administrative Expenditures for a list of the travel costs that can and cannot be claimed as Title IV-E training.

4140 Indirect Costs and the Indirect Cost Rate

Title IV-E Finance Handbook for County Contracts August 2009

Indirect Costs

Indirect costs are costs that are incurred for common or joint purposes, unlike direct costs that can be identified with a particular cost area, department, or program.

Indirect Cost Rate

Indirect costs are normally charged to federal programs by the use of an indirect cost rate. If a county desires to allocate indirect costs to the Title IV‑E contract, an indirect cost rate proposal and related documentation must be prepared in accordance with OMB A-87, Cost Principles for State, Local, and Indian Tribal Governments, as outlined in:

  •  Appendix C: State/Local-Wide Central Service Cost Allocation Plans; and

  •  Appendix E: State and Local Indirect Cost Rate Proposals.

The cost principles are also located in 2 CFR Chapter 225.

The Certificate of Cost Allocation Plan and related documentation signed by the county’s authorized signatory must be retained for audit, in accordance with federal requirements on records retention.

Copies of the Certificate of Cost Allocation Plan and documentation:

  •  are provided to the DFPS regional contract manager; and

  •  accompany the first billing of each fiscal year that is submitted to the DFPS Federal Funds Division for reimbursement.

4141 Contingency Fees

Title IV-E Finance Handbook for County Contracts August 2009

Fees for professional services, if they are contingent upon recovery of the costs from the federal government, are not allowed.

See:

      OMB Circular A-87, Attachment B, paragraph 32

      Decision No. 1660, the Departmental Appeals Board of the U.S. Department of Health and Human Services

DFPS has determined the following:

  •  If Texas counties or other contractors have a contingent fee contract and are not attempting to charge those fees to DFPS contracts, DFPS does not disallow other legitimate costs that were actually expended on the program.

  •  If counties or other contractors attempt to charge the contingent fee for professional services to the contract, DFPS disallows the costs, but not other legitimate costs. The current OMB Circular A-87 Attachment B, paragraph 32, does not allow the fee to be charged to the contract even if the fee is for a reasonable amount.

If Texas counties or other contractors have professional services contracts with consultant firms and are paying them a set fee or a set fee per hour, the fee can be charged to the DFPS contract, if:

  •  the fee is a reasonable; and

  •  the basis for the cost or price is documented in the county's procurement files.

45 CFR §74.46

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