COVID Federal Funding Update

Educational Service Fiscal

Center of Lake Erie West Workshop

June 23, 2021 Presented by:Teresa Hicks, MBA

Single Audit Coordinator, Center for Audit Excellence Bob Hinkle, CPA

Chief Deputy Auditor

The information in this slide show may be subject to change.

Federal COVID-19 program guidance continues to evolve and changes frequently. Local governments should remain diligent and regularly stay informed by monitoring state and federal agency websites.

Agenda

Coronavirus Aid, Relief, and Economic Security Act (CARES) H.R. 748

Families First Coronavirus Response Act—H.R. 6201

Coronavirus Preparedness and Response Supplemental Appropriations Act—H.R. 6074

Paycheck Protection Program and Health Care Enhancement Act (P.L. 116-139

Consolidated Appropriations Act of 2021

American Rescue Plan American Rescue Plan of 2021 (Public Law 117-2) passed 3/11/2021 - $1.9 Trillion in COVID-19 Relief

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COVID-19 Federal Funding Timeline

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Consolidated Appropriations Act of 2021

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American Rescue Plan of 2021

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AOS Resources

AOS also issued Bulletin 2021-004, Separate Accountability for Federal Programs Authorized by the American Rescue Plan Act of 2021. Refer to https://ohioauditor.gov/publications/bulletins/2021/2021-004.pdf.

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AOS has received high volume of Unemployment Insurance Claims…

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Consolidated Appropriations Act

Coronavirus Relief Funds (CRF)

(CFDA 21.019)

Deadline Extended

• Controlling Board extended the deadline for CRF funds OBM administers to December 31, 2021.
• ODE extended the deadline for CRF allocations to schools and the Broadband Ohio program as well.
• Limited Uniform Guidance applicability, Procurement does not apply.

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Federal COVID-19 Programs for Schools

FIFO & Uniform Guidance Applies

• The CARES Act, Consolidated Appropriations Act of 2021 and American Rescue Plan have created three separate rounds of federal funding in programs originally established by the CARES Act.
• Each iteration of funding has slightly different requirements, therefore, each must be accounted for separately. Uniform Guidance applies to all programs and all three waves, including Procurement rules.
• Rule of thumb, you must spend ESSER I before ESSER II and then spend ESSER II before ESSER III.
• Same concepts apply to GEER and HEERF.

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CARES Act Established ESSER

ESSER I (84.425D)

https://ccip.ode.state.oh.us/documentl ibrary/default.aspx?ccipSessionKey=63 7595232943763764

ODE is responsible for administering ESSER I and is responsible for oversight.

• Allocated to School Districts.

• Record in Fund 507, USDE requires separate accountability.

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Consolidated Appropriations Act

ESSER II $82 Billion allocated to schools

• May be used for allowable expenses from March 13, 2020 until September 30, 2022.
• Uniform Guidance applies, including Federal Procurement Rules.
• Allowable uses are fairly broad – twelve categories.

• Anything that is allowable under ESEA, IDEA, Perkins, Adult Ed, McKinney; sanitizing buildings, mental health services, providing principals and other school leaders with resources needed to address the needs of their individual buildings, activities necessary to maintain continuity of services and continue employing existing staff, etc.

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Consolidated Appropriations Act

ESSER II (84.425D) Allowable Uses

• ODE is allocating ESSER II to K-12 schools.

• Schools should record separately in a SCC within Fund 507, USDE requires separate accounting from ESSER I.

• Same allowable uses as ESSER I, plus…

• Additional allowable uses include addressing learning loss, preparing schools for reopening, testing, repairing and upgrading projects to improve air quality in school buildings.

• USDE clarified these additional allowable uses are also allowable under ESSER I.

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Consolidated Appropriations Act

ESSER II (84.425D) Allowable Uses

ODE and AOS strongly encourage schools to take time to document these considerations for ESSER II expenditures:

• Will the proposed use of funds “prevent, prepare for, and respond to coronavirus?

• Is it an allowable use of funds under the legislation?

• Is it reasonable and necessary?

• Does it promote equity?

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Consolidated Appropriations Act

ESSER II (84.425D) Allowable Uses

ESSER II is not a “lost revenue” grant. Some have been confused about this since “continuity of operations” is so broad.

• Can be used to supplant state and local funds.

• However, schools must still identify allowable expenses and allocate them to the ESSER II SCC of Fund 507.

• Schools must maintain documentation to support allowable expenses charged to the program.

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American Rescue Plan

ESSER III (84.425D) Allowable Uses

• May be used for pre-award costs dating back to March 13, 2020.

• Available for obligations through September 30, 2023.

• Schools must reserve not less than 20% of ARP ESSER allocation to address learning loss through the implementation of evidence-based interventions, such as summer learning or summer enrichment, extended day, comprehensive after school programs or extended school year programs and ensure response to students’ academic, social and emotional needs, addressing the disproportionate impact of COVID-19 on underrepresented student subgroups.

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American Rescue Plan

ESSER III (84.425D) Allowable Uses

• Remaining ESSER III funds may be used for the same allowable purposes as ESSER I and ESSER II, including hiring new staff and avoiding layoffs.

• ARP authorizes schools to use ESSER to develop strategies and implement public health protocols, including policies in line with CDC guidance for reopening and operation of school facilities.

• Schools may also use ESSER I and ESSER II for these purposes even though CARES Act and Consolidated Appropriations Act of 2021 did not expressly authorize it.

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CARES Act Established GEER

GEER I (84.425C) Allowable Uses

ODE is responsible for administering $154 million in GEER I; however, the Governor remains the grantee and is responsible for oversight.

• Allocated to ESCs and Boards of DD.

• Record in Fund 508, USDE requires separate accountability.

• Same allowable uses as ESSER I but designed to support entities who did not receive ESSER funding. (i.e. ESCs)

https://ccip.ode.state.oh.us/Doc umentLibrary/Default.aspx?ccipS essionKey=637359622700274835

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Consolidated Appropriations Act

GEER II (84.425C) Allowable Uses

ODE is responsible for administering $154 million in GEER II; however, the Governor remains the grantee and is responsible for oversight.

• Available for obligations through September 30, 2023.

• ESCs should record separately in a SCC within Fund 508, USDE requires separate accounting from GEER I.

• Designed to provide emergency assistance to teachers and students in nonpublic schools through the Emergency Assistance to Non-Public Schools program (a subprogram of GEER).

• Nonpublic schools request reimbursement for expenses for allowable services or assistance on or after March 20, 2020 to prevent, prepare for, and respond to COVID-19, that have not already been reimbursed with federal funds, including PPP.

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Consolidated Appropriations Act

GEER II (84.425C) Allowable Uses

• Reimbursements under this program do not make nonpublic schools recipients of federal financial assistance.

• ODE, or a public agency it designates, must control funds for services and assistance for which nonpublic schools apply, request supporting documentation, and provide the allowable requested services and assistance.

• ODE plans to contract with ESCs to provide services and assistance to nonpublic schools under this program. On behalf of ODE, the ESCs may contract with the nonpublic schools directly.

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Consolidated Appropriations Act

GEER II (84.425C) Allowable Uses

• ODE will view ESCs as contracted vendors, providing services and assistance to nonpublic schools.

• ODE will report GEER II expenditures on the State of Ohio’s Federal Schedule.

• As vendors, ESCs will not have to report GEER II expenditures on their own Federal Schedules.

• GEER II includes a broad list of allowable services and assistance that nonpublic schools can use to request reimbursement.

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American Rescue Plan

GEER III (84.425C) Allowable Uses

ODE is responsible for administering GEER III; however, the Governor remains the grantee and is responsible for oversight.

• Available for obligations through September 30, 2023.

• ESCs should record separately in a SCC within Fund 508, USDE requires separate accounting from GEER I and GEER II.

• Designed to provide emergency assistance to non-public schools that enroll a significant percentage of low-income students and are most impacted by the qualifying emergency through the Emergency Assistance to Non-Public Schools program (a subprogram of GEER).

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CARES Act Established HEERF

HEERF I – Student Aid

(84.425E) Allowable Uses

• Administered directly by USDE

• Available to Title IV participating career centers, JVS districts, and
others that receive the SFA Cluster.

• Provides students with emergency financial aid grants to help cover
expenses related to disruption of campus operations due to COVID-19.

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CARES Act Established HEERF

HEERF I – Student Aid

(84.425E) Allowable Uses

• Schools should use a separate SCC in Adult Education Fund 012 to
track each HEERF subprogram, and waves of funding within subprograms, separately.
• If school used a 599 Fund, use separate SCCs each program
and wave.

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CARES Act Established HEERF

HEERF I – FIPSE

(84.425N) Allowable Uses

• Administered directly by USDE

• Fund for the Improvement of Postsecondary Education (FIPSE).

• May be used to defray expenses incurred due to COVID-19, including lost
revenue, reimbursement for expenses already incurred, tech costs for distance learning, training, payroll, and grants to students.

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Consolidated Appropriations Act

HEERF II – Student Aid
(84.425E) Allowable Uses

• Available for obligations through September 30, 2022.

• Financial aid grants for students may be used for any component of the
student’s cost of attendance or for emergency costs that arise due to coronavirus, such as tuition, food, housing, health care (including mental health care) or child care.

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American Rescue Plan

HEERF III – Student Aid

(84.425E) Allowable Uses

• Available for obligations through September 30, 2023. • Portion of the funds must be used for
• Implementation of evidence-based practices to monitor and suppress coronavirus in accordance
with public health guidelines; and

• conduct direct outreach to financial aid applicants about the opportunity to receive a financial aid
adjustment due to the recent unemployment of a family member or independent student, or other circumstances, described in section 479A of the Higher Education Act of 1965 (20 U.S.C. 1087tt)

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CARES Act

Nutrition

Cluster

• COVID-19 Nutrition programs Administered by ODE

• COVID-19 funding can be received under any Nutrition Cluster program – ODE assigns the schools’ claims to COVID-19 funding after the schools’ submission in CRRS.

• ODE then provides COVID-19 claiming information to schools for Federal Schedule reporting.

• Many Federal waivers are in effect in Ohio. Each school can vary on which waivers they qualify for.

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Consolidated Appropriations Act of 2021

Nutrition

Cluster

•	 Provided Supplemental reimbursement for each individual month up to 55% of the difference in the
reimbursements.

• ODE will complete the calculation and make payments. Entities need not apply. ODE anticipates payments being made in September.

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American Rescue Plan

Nutrition

Cluster

• ODE will provide guidance as soon as it is made available.

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Federal COVID-19 Programs for Local Governments

Many new programs with historical amounts of Federal funding

• Must keep CARES Act and American Rescue Plan (ARP) funding segregated in separate funds.
• FFATA and Ohio Rev. Code Chapter 5705 require this for most entities.
• Due to the unprecedented funding amounts, the risk of noncompliance and fraud will be high with this funding.
• We anticipate Federal OMB will make ARP programs higher risk for audit (meaning, we may have to audit more).
• Governments have a responsibility to provide advance notice to its depository institution when a large increase in the account balances is expected. Failure to provide notice may result in under-collateralization.

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Consolidated Appropriations Act

• Emergency Rental Assistance Program I

• Additional funding for transit, state highways, airports

• Additional $300 of Unemployment to March 14, 2021

• Funding for vaccine distribution, testing, tracing, and mental health

• Various Broadband programs

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American Rescue Plan

Assistance to States and Local Governments

• State and Local Fiscal Recovery Funds - Available for costs incurred beginning March 3, 2021 through December 31, 2024.

• Coronavirus Capital Projects Fund - Available until expended.
• Emergency Rental Assistance Program II - Provided expanded assistance through September 30, 2027.

• Homeowner Assistance Fund - Available until Sept. 30, 2025, for qualified expenses.

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American Rescue Plan

• More funding in the following programs available through Sept. 30, 2025, unless otherwise indicated:

• FEMA Disaster Relief Fund

• Airport Assistance Grant (Sept. 30, 2024)

• Federal Transit Administration grants for public transportation (Sept. 30, 2024)

• Low Income Water and Home Energy Assistance (Sept. 30, 2022)

• There is also additional funding available in other areas, such as mental health, aging services, child care and development, etc.

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American Rescue Plan • Emergency paid sick leave credits:

• Grants state and local governments as well as Federal governmental instrumentalities that are tax-exempt 501(c)(1) organizations the ability to access the paid sick time and paid family leave credits under the FFCRA

• Access to credits for leave provided March 31, 2021 through September 30, 2021

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Fiscal Year End
	Normal Due Date*
	Extended Due Date *
	
March 31, 2020
	December 31, 2020
	June 30, 2021
	
April 30, 2020
	February 1, 2021
	July 31, 2021
	
May 31, 2020
	March 1, 2021
	August 31, 2021
	
June 30, 2020
	March 31, 2021
	September 30, 2021
	
July 31, 2020
	April 30, 2021
	October 31, 2021
	
August 31, 2020
	May 31, 2021
	November 30, 2021
	
September 30, 2020
	June 30, 2021
	December 31, 2021
	
October 31, 2020
	July 31, 2021
	January 31, 2022
	
November 30, 2020
	August 31, 2021
	February 28, 2022
	
December 31, 2020
	September 30, 2021
	March 31, 2022

Fiscal Year End
	Normal Due Date*
	Extended Due Date *
	
January 31, 2021
	October 31, 2021
	April 30, 2022
	
February 28, 2021
	November 30, 2021
	May 31, 2022
	
March 31, 2021
	December 31, 2021
	June 30, 2022
	
April 30, 2021
	January 31, 2022
	July 31, 2022
	
May 31, 2021
	February 28, 2022
	August 31, 2022
	
June 30, 2021
	March 31, 2022
	September 30, 2022

Impact on Single Audits – OMB Memo 21-20 Six Mo. Extension

Automatic extension applies to all audits not submitted to FAC prior to March 19, 2021 (date of Memo). Supersedes prior extensions. Must document COVID-19 reasons for delay. Do not have to receive COVID-19 funding to receive the extension.

* Per 2 CFR 200.512 if the filing due date falls on a Saturday, Sunday, or Federal Holiday the due date will be the next business day.

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Allocating Audit Costs to Federal Programs

• The Uniform Guidance in §200.425 allows “A reasonably proportionate share of the costs of audits required by, and performed in accordance with, the Single Audit Act Amendments of 1996 (31 U.S.C. 7501-7507), as implemented by requirements of this part, are allowable.”

• However, some exceptions exist, including audits not performed in accordance with the Single Audit requirements (such as a performance audit) and audit costs for an entity which does not meet the single audit threshold of $750,000.

• Therefore, the cost of your single audit may be considered an allowable cost, unless the terms and conditions of your grant award indicate otherwise. See AOS Bulletin 2021-006 – Hourly Billing Rates and Allocation of Audit Costs

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Federal OMB anticipates issuing 2021 Compliance Supplement in three installments:

1.	General guidance without key programs by May 31, 2.	Key programs late June, and
3.	New ARPA programs by late October
	
Federal agencies still determining if they will create new program assistance listing numbers for programs stemming from Consolidated Appropriation Act or ARP Act.

When available, recipients should refer to the Assistance Listing for detail on the specific provisions of UG that do not apply to these programs.
	
Separate accountability applies.

Impact on Single Audits - Challenges

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KEY

• DOCUMENT

• DOCUMENT

• DOCUMENT

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Center for Audit Excellence 88 E. Broad St. Columbus, Ohio 43215 OhioAuditor.gov phone: (800) 282-0370
Presenters: Rhonda L. Kline & Teresa Hicks rlkline@ohioauditor.gov & tmhicks@ohioauditor.gov Federal questions: FACCR@ohioauditor.gov

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