Finding Text
Program: COVID-19 Education Stabilization Fund ALN 84.425F Higher Education Emergency Relief Fund ? Institutional Portion Compliance Requirement: Period of Performance Condition: The quarterly reports reflect $4.6 million in expenditures for debt forgiveness that was for institutional debt before March 13, 2020. These expenditures were not in compliance with the period of performance. Criteria: Pursuant to 2022 Compliance Supplement ESF Section 2 III Reporting, the College is to file quarterly reports to reflect expenditures of that quarter by purpose for expenditure within the period of performance. Cause: The College was not aware of the grant?s period of performance. On September 23, 2022, the College was asked to contact the Department of Education for guidance and clarification on debt forgiveness being outside the period of performance for $4.6 million of $6.5 million in debt forgiveness expenditures or obtain a waiver allowing expenditures prior to March 13, 2020. The College?s request for a waiver was denied on November 29, 2022. However, the Department of Education gave written approval to the College to apply invoices for expenditures that are within the grant guidelines and period of performance to replace the disallowed portion of the debt forgiveness that was before March 13, 2020. As the approval was obtained prior to presentation to the Board of Regents for approval, the reclassified expenditures were considered in the compliance testwork and were within the grant guidelines. Amended reports reflecting expenditures by the updated purpose need to be filed with the Department of Education. Effect: The College could be asked to return funding if expenditures are viewed as out of compliance with the period of performance. Context: The College originally applied funds to debt forgiveness in which $1.9 million was within the period of performance and $4.6 million that was outside the period of performance. The debt forgiveness waiver was not approved by the Department of Education for items before March 13, 2020, due to the Department of Education viewing these as recruiting expenditures. The Department of Education gave written approval to the College to amend reports with expenditures that were applicable under the grant guidelines. The quarterly reports reflected only debt forgiveness and have not been amended to reflect accurate expenditures for the period of performance. Questioned Cost: None due to the Department of Education?s approval to file amended reports and exchange disallowed costs with allowable expenditures. Repeat Finding: No Recommendation: The College needs to ensure they understand high-risk grant requirements by reviewing the compliance supplement, the Department of Education?s website and making contact with the Department on questions of concern in a timely fashion. Views of Responsible Officials: The College requested an exchange of expenditures in order to ensure only allowable costs were utilized. The Department of Education granted this exchange and approved filing amended reports. The College will amend the quarterly reports to properly reflect the approved allowed expenditures as per the email from the Department of Education. Staff will contact the Department on any questions they have going forward on questioned expenditures or allowed costs.