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SWCAP Recoveries

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SWCAP Recoveries

• Recoveries mean the recovery of indirect costs from the federal government.

• Indirect cost includes both the State departments indirect cost and the statewide indirect costs, SWCAP.

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SWCAP Recoveries - continued

• Only the SWCAP is transferred to the General Fund.

• Process of transferring SWCAP to the General Fund is shown on the flow chart on the next slide.

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Billfederal fund

for direct plus indirect costs

Receipt infederal

fund

TransferSWCAP to

General Fund

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• Federal government reimburses a State department for indirect costs, a portion of the recoveries is attributed to SWCAP.

• Portion representing SWCAP recoveries must be transferred to the General Fund.

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• Government Code sections

13332.0113332.02

Authority to recover SWCAP and transfer to the unappropriated surplus of the General Fund are specified in these sections.

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• State Administrative Manual Section 8755.1 et. al specifies the State policy on SWCAP recoveries and transfers.

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• SWCAP is recovered through an Indirect Cost Rate Proposal (ICRP) or a Cost Allocation Plan (CAP) from CALSTARS or non CALSTARS departments.

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• State departments must recover full costs associated with its programs and/or activities.

• View the presentation, Full Cost Recovery for additional information.

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• Many components are included in an indirect cost rate proposal (ICRP).

• Attend an ICRP training class for additional information.

• Following are some of the federal regulations and guidelines.

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• Federal regulations provide guidance for ICRPs and recoveries of indirect costs:• Federal Circular A-87 httpwww.whitehouse.gov

/OMB/circulars/index.html

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• Cost Principles and Procedures for Establishing Cost Allocation Plans and Indirect Cost Rates for Agreements with the Federal Government (ASMB C-10).

http://www.os.dhhs.gov/progorg/grantsnet/index.html

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• State departments will document any non-recovery of SWCAP budgeted amounts and send documentation to the SWCAP analyst:

• Grant Application

• Legislation

• Other relevant information

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• SWCAP recoveries must be transferred to the General Fund within 30 days after the end of each quarter.

• No automatic transfer by the SCO.

• Federally funded State departments initiate the transfer process via a transfer letter.

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• State departments prepare a “Transfer Letter.” (See SAM Section 8755.2 for example.)

• State Controller’s Transaction Request, form CA 504.

• Include specific information in the “Transfer Letter.” See next slide.

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SWCAP Recoveries - continued

• Specific information includes:

• SWCAP transfer amount.

• Time period the recovery spans.

• General Ledger account.

• Current fiscal year:

• Budgeted SWCAP recoveries.

• Total SWCAP recoveries transferred.

. . . And . . .

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• Prior fiscal year total SWCAP recoveries transferred.

• Person to contact for questions. Include:

• Name

• Telephone number

• E-mail

• Transfer letter signed by the chief of the accounting office.

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• Send transfer letter and one copy to your Department of Finance (Finance) budget analyst.

• Finance budget analyst will review, contact you with any questions, sign both copies, forward the original to the State Controller’s Office, and send copy to the SWCAP analyst.

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SWCAP Recoveries - continued

• State Controller’s Office (SCO) will transfer the funds.

• Finance SWCAP analyst will:

• Reconcile transfer letter with SCO records.

• Monitor recoveries.

• Contact State department on their recoveries or lack of recoveries.

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SWCAP Recoveries - continued

• Yearly, Finance SWCAP analyst will contact State departments to review their SWCAP recoveries or lack of recoveries.

• Yearly, Bureau of State Audits will review State departments federal funds, budgeted SWCAP amount and recoveries, Finance recoveries reconciliations, and responses from State departments on recoveries or lack of recoveries.

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• Amount of SWCAP budgeted and recovered is shown at this link: Link to SWCAP Historical Data

SWCAP Historical Data

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We hoped this helped. Please view our other presentations.