LPA Certification Program Management

1. LPA CertificationProgram Management Kristin Burkart WYDOT Internal Review Manager 307-777-4797 kristin.burkart@wyo.gov

2. Training Objectives • Flow of Federal Funds • Recipient vs. Local Public Agency (Subrecipient) vs. Contractor (Vendor) • WYDOT Responsibilities • LPA Responsibilities • Relationship of Office of Management & Budget (OMB) Circulars • Administrative Requirements • Cost Principles • Audit Requirements • Different Types of Cooperative Agreements • LPA Monitoring

3. Flow of Federal Funds Federal Awarding Agency (FHWA, FTA, NHTSA) WYDOT (Recipient) Subrecipient (LPA) or Contractor (Vendor)

4. WYDOT FY 2013 Pass-Through Funding

5. WYDOT Responsibility • Accountable to Federal Agencies for the use of Federal Funds • Document the roles & responsibilities • Identify and provide information about federal awards • Inform LPA about compliance requirements. • Monitor LPA activities • Provide technical advice and training • Ensure LPA has single audits, if required • Issue management decisions and ensure LPA takes corrective action • Adjust WYDOT’s records as a result of LPA audit, if required

6. LPA Responsibility • Follow the cooperative agreement • Including Form 1273 • Develop internal policies and systems • Ensure the organization has a financial management system • Establish a budget • Keep abreast of changes in policies, procedures or requirements • Request prior approvals when necessary • Make the most of site visits by WYDOT • Prepare necessary reports • Communicate project progress with WYDOT Grant Administrators • Permit WYDOT access to records

7. Relationship of OMB Circulars State & Local Governments 49 CFR Part 18 (A-102): Grants & Cooperative Agreements with State & Local Governments 2 CFR Part 225 (A-87): Cost Principles for State, Local & Indian Tribal Governments Educational Institutions & Nonprofit Orgs 2 CFR Part 215 (A-110): Uniform Administrative Requirements for Grants & Other Agreements with Institutions of Higher Education, Hospitals, & Other Nonprofit Organizations 2 CFR Part 220 (A-21): Cost Principles for Educational Institutions or 2 CFR Part 230 (A-122): Cost Principles for Nonprofit Organizations OMB Circular A-133: Audits of States, Local Governments & Nonprofit Organizations

8. References Code of Federal Regulations (CFR) http://ecfr.gpoaccess.gov/cgi/t/text/text-idx?c=ecfr&tpl=%2Findex.tpl OMB Circulars http://www.whitehouse.gov/omb/circulars_default/

9. Administrative Requirements • Administrative vs. Programmatic Requirements • Administrative requirements are processes and policies entities must adhere to in carrying out federal grants. • Programmatic requirements concern matters that can be treated only on a program-by-program or grant-by-grant basis

10. Administrative Requirements • Financial Management Systems • Payment • Allowable Costs • Period of Availability of Funds • Matching or Cost Sharing • Non-Federal Audits • Changes • Real Property, Equipment & Supplies • Subawards to Debarred/Suspended Parties • https://sam.gov • Procurement • Subgrants • Monitoring and Reporting Program Performance • Financial Reporting • Retention and Access Requirements for Records • Enforcement • Termination for Convenience (mutual agreement)

11. Programmatic Requirements • Title VI of the Civil Rights Act of 1964 • 23 CFR Part 200 • Americans with Disabilities Act of 1990 (ADA) • 49 CFR Part 37 • Disadvantaged Business Enterprise (DBE) • 23 CFR Part 230 Subpart A • Limited English Proficiency Requirements (LEP) • Executive Order 13166 • Uniform Relocation Assistance and Real Property Acquisition Act of 1970 as amended • 49 CFR Part 24 Subpart A • Design Standards • 23 CFR Part 625 • National Environmental Policy Act (NEPA) • 23 CFR Part 771

12. Cost Principle Requirements • Allowability vs. Eligibility • Basic Guidelines • Allowable Costs • Allocable Costs • Reasonable costs • Necessary Costs • Applicable Credits

13. Cost Principle Requirements Composition of Project Costs Direct Costs + Indirect Costs (approval required) - Credits Total Project Costs

14. Cost Principle Requirements • Selected Items of Cost (not all inclusive) • Advertising and Public Relations • Alcoholic Beverages • Communication • Depreciation • Entertainment • General Government Expenses • Maintenance, Operations & Repair • Materials & Supplies • Professional Service Costs • Rental Costs • Training • Travel

15. Audit Requirements • If LPA expends $500,000 or more in combined Federal dollars during their fiscal year they are required to hire a qualified CPA to conduct an OMB Circular A-133 Audit • Must be filed with the Federal Audit Clearinghouse within the earlier of 30 days after receipt of the auditor’s report or within 9 months after the end of the audit period (fiscal year) • IR will send out certifications every year to LPAs who received federal dollars as pass-through from WYDOT • Consequences of not having an audit conducted in accordance with regulations

16. Audit Requirements • Internal Review will do the following once the certification letter and applicable audit report are submitted to WYDOT: • Review audit report for accuracy • Review corrective action plan for reasonableness • Name of contact person responsible for corrective action • Corrective action planned • Anticipated completion date • Issue a Management Letter to LPA with acceptance/denial of corrective action plan and any recommendations • Follow-up with the next audit report to ensure findings have been corrected

17. Audit Findings • Most common LPA findings related to WYDOT funding: • Internal Controls • Allowable Costs • Cash Management • Davis Bacon • Procurement policies • Not obtaining audit within required time frame

18. Put Into Perspective • On average WYDOT has 100 LPAs who receive federal dollars • Only 47 LPAs (47%) are required to have OMB Circular A-133 audits • Only 4 LPAs (8.5%) have findings pertaining to WYDOT pass-through funding

19. Different Types of Cooperative Agreements • Cooperative Agreements as a: • LPA project: the LPA applies and is awarded a project that they administer. • Expenditures must be reported on LPA’s Schedule of Federal Expenditures (SEFA) in their OMB Circular A-133 Audit. • WYDOT Project: WYDOT works in conjunction with the LPA to have a project done and WYDOT administers the project. • Expenditures must be reported on WYDOT’s SEFA • To determine the audit reporting requirements refer to the Audit language in the contract.

20. LPA Monitoring • Per 49 CFR Part 18.40 WYDOT is required to conduct oversight monitoring of all funds passed through to LPAs which could include the following: • Review LPA reimbursement requests • Review LPA reports/documents • Review single audits • Schedule site visits • Conduct LPA audits based on risk • Project inspections by WYDOT or Federal Agencies • Approval for certain activities • Provide technical assistance & training • Communicate (phone, email, etc.) • Follow LPA coverage in news

21. LPA Monitoring • Project Delivery Systems & Internal Control Questionnaire required for LPAs prior to award: • Questionnaire must be filled out by new LPAs prior to award • WYDOT Internal Review & Planning must both approve ICQ • Approval on ICQ is good for 4 years & then must be updated • www.dot.state.wy.us/home/planning_projects/transportation_programs/grant_administration.html

22. What Does Internal Review Look At During An Audit • Internal Controls from ICQ • Approvals • Policies & Procedures • Support documentation • Compliance Requirements • Allowable Activities/Costs • Cash Management • Suspended & Debarred Entities • DBE & Title VI • Consultant selection & approval • Federal provisions included in contracts • Contract provisions including Form 1273 • State Statutes

23. Final Thoughts • Read and understand the agreement terms and provisions • Revisit agreement requirements frequently throughout the project • Familiarize all staff with provisions, regulations and program policies and procedures • Ensure supporting documentation is present • If it isn’t documented, it didn’t happen!

25. Contact Information • Kristin Burkart Internal Review Manager 307-777-4797 kristin.burkart@wyo.gov • IR website www.dot.state.wy.us/home/administration/internal_review.default.html

26. Questions??