Title: Loans and Loan Guarantees Outstanding
Accounting Policies: 1. Basis of Presentation
The accompanying schedule of federal awards includes the federal grant activity of AEDC and is presented on the accrual basis of accounting. The information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in, the preparation of the financial statements.
2. Summary of Significant Accounting Policies
Expenditures - Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance wherein certain types of expenditures are not allowable or are limited to reimbursement.
Indirect Cost Rate - AEDC has elected to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance.
3. Subrecipients
Of the federal expenditures presented in this schedule, AEDC did not provide any federal awards to subrecipients.
4. Nonmonetary Assistance
AEDC neither received nor disbursed federal awards in the form of nonmonetary assistance during
the fiscal year ended June 30, 2024.
De Minimis Rate Used: Y
Rate Explanation: Arcata Economic Development Corporation has elected to use the 10 percent de minimis indirect cost rate as allowed
under the Uniform Guidance.
5. Loans and Loan Guarantees Outstanding
In accordance with the Uniform Guidance, §200.502 Basis for determining Federal awards expended, since the federal government is at risk for loans and loan guarantees awarded until the debt is repaid, the amount to be presented as expenditures of federal awards for loans and loan guarantees awarded, including those awarded and expended in prior years that have continuing compliance requirements, is:
(1) Value of new loans or loan guarantees made or received during the audit period; plus
(2) Beginning of the audit period balance of loans and loan guarantees from previous years for which the federal government imposes continuing compliance requirements; plus
(3) Any interest subsidy, cash, or administrative cost allowance received.
Accordingly, AEDC has reported loans and loan guarantees awarded in accordance with the aforementioned criteria. Amounts presented as expenditures of federal awards for loan and loan guarantee programs by federal CFDA number are as follows:
10.767 10.870 59.012 59.046
Value of new loans made $ - $ - $ - $ 350,000
Value of new loan guarantees made - - 215,050 -
Loan balance, beginning of the year 3,201,386 372,320 - 70,701
Total expenditures of federal awards
presented for loan and loan
guarantee programs 3,201,386 372,320 215,050 420,701
Balance of loans and loan
guarantees at June 30, 2024 $2,988,744 $ 352,532 $ - $ 386,815
During the year ended June 30, 2024, AEDC issued 3 loans with a face value $253,000 under the U.S. Small Business Administration Community Advantage Pilot 7(a) Loan Guarantee Program (SBA CAP). Loan guarantees were provided under the SBA CAP for either 75% or 85% of the original loan balance, or $215,050.
6. Basis for Determining Expenditures of Federal Awards for the Economic Adjustment Assistance Program, Federal CFDA 11.307
The Office of Management and Budget (OMB) Compliance Supplement formula to determine the amount to be presented on the schedule of expenditures of federal awards for revolving loan fund (RLF) grants under federal CFDA 11.307. The formula to determine expenditures to be reported in the Schedule is as follows:
(1) The balance of RLF loans outstanding at the end of the recipient's fiscal year, plus;
(2) The cash and investment balance in the RLF at the end of the fiscal year, plus;
(3) Administrative expenses paid out of the RLF during the year, plus;
(4) The unpaid principal of all loans written off during the year; and then multiply this sum by;
(5) The federal share of the RLF based on the federal grant rate as specified in the grant award.
Accordingly, AEDC has reported expenditures of federal awards for its Economic Adjustment Assistance funded RLF program as follows:
Balance of RLF loans outstanding at June 30, 2024 $ 460,242
Cash balance in RLF at June 30, 2024 102,311
Administrative expenses paid out of the RLF during the year 329
Unpaid principal of all RLF loans written off during the year -
Total RLF expenditures for year ending June 30, 2024
(100% federal) $ 562,882