Frequently Asked Questions

Administrative Issues
FS-10 and FS-20 Budget Forms
FS-10-F Final Expenditure Report
Purchased Services
Equipment
Indirect Costs
Central Service Costs
Salaries, Compensation, Fringe Benefits and Related Issues
Travel Costs

Administrative Issues

I use Grants Finance's website to look up my agency's open grant projects. What other information is available from the website?
There are several reports available on Grants Finance's website - Federal & State Grant Payments End of Year Reports, District Summary Reports, NCLB Allocation Reports and IDEA Allocation Reports.  Agencies can also access forms for federal and State grants - FS-10 and FS-20 budgets, FS-10-A budget amendments, FS-10-F final expenditure reports, FS-25 request for additional funds, and payee information forms. Visitors to our website will also find general information about Grants Finance and its functions, in addition to a list of staff.  There is a wealth of guidance, as well.  We strive to provide up-to-date, valuable information to the website's visitors and invite comments and suggestions for improvement.  
Our business office manager signed an interim request for additional funds (FS-25) but it was returned with a note asking for an authorized signature. Who is authorized to sign?
The person authorized to sign the certification statement on budgets (FS-10), final expenditure reports (FS-10-F), amendments (FS-10-A) and requests for additional funds (FS-25) is the Chief Administrative Officer of the agency or a properly authorized designee.
Can we use a signature stamp?
Signatures on the Certification Statement must be original. Signature stamps, photocopies and fax copies will not be accepted.
Our charter school has a management company to conduct some or all of the administrative activities for the school.  Can an employee of the management company sign as the chief administrator of the school?
Management companies are not eligible recipients of grants administered by SED.  Therefore, their employees are not permitted to sign the financial documents related to grants.  Such documents should only be signed by the president of the school’s board of trustees, the school’s principal, or another employee of the charter school if the employee has been provided with authority through the vote of the board of trustees.
Our school's administrative offices have moved. How can we get our school's address information updated so that checks are mailed to the proper address?
In order to report any changes to payee information, including a change of address, the agency must complete a Payee Information (PI) form.   This form is available on the Forms page.
I have had costs disallowed on an FS-10-F because the costs were not encumbered during the project period. When exactly is an encumbrance incurred on a grant? Are the rules different for State versus Federal grants?
All project encumbrances, whether on a State or federal grant, must be made within the approved funding period of the grant. Costs encumbered outside the project dates cannot be reimbursed on the FS-10-F. However, the type of cost affects when the encumbrance is made. For example, if the cost involves the performance of work other than personal service, the encumbrance is made on the date on which the grantee makes a binding written commitment to obtain the work. A contract would be a type of binding written agreement. An encumbrance for travel, on the other hand, is treated differently. In this case, the encumbrance is made when the travel is actually taken. For more specific examples, please refer to the General Guidelines section of our Fiscal Guidelines for Federal and State Grants.
We recently received a Notification of Overpayment (Form FS-80) indicating that SED transferred the amount we were overpaid on one grant project to another open project.  Can we send a refund check instead of offsetting the amount owed to another grant project?
It is SED's policy to transfer overpayments whenever possible.  If the review of an FS-10-F final expenditure report results in an overpayment, a Notice of Overpayment is sent to the agency identifying the grant project that was overpaid and the grant project charged for the overpayment.  If there are no eligible open grants or grant contracts, the notice will instead instruct the agency to send a refund check.
Space for retaining previous year's records is at a premium.  How long must I maintain the financial records for the grants our agency received?
General supporting documentation must be retained for the current year plus six prior years unless otherwise specified by program requirements.  Additionally, audit or litigation will "freeze the clock" for records retention purposes until the issue is resolved. For more specific information, the State Archives makes Records Retention and Disposition Schedules available at http://www.archives.nysed.gov/a/records/mr_retention.shtml.

FS-10 and FS-20 Budget Forms

Which budget form is required for my grant?  Should I use the FS-10 or FS-20?
The grant application or Request for Proposal will specify what budget form should be submitted. If you have reviewed the application/RFP and still have questions, contact the SED office listed in the application/RFP.
I am preparing next year’s budget and would like to confirm my school district’s current year allocations plus any amount that is available as carryover.
Allocation and carryover information are available on Grants Finance's website.  Separate reports for past years and the current year are maintained for the IDEA and NCLB allocation programs.  These reports provide allocations, carryover and budget information and are updated nightly. On the Reports page, select your county and then your school district or charter school.
Can I prepare my budget to include my allocation plus carryover?
Generally, yes. However, individual SED program managers may require you to follow a different process.
Our agency is applying for a grant to conduct a series of district workshops. The description of the workshops and other details of the grant, which are rather lengthy, will not fit on the budget form (FS-10). How much detail should I provide?
Detailed descriptions often cannot be accommodated on the FS forms. It is appropriate to indicate in the budget "see attached" and provide an attachment which briefly and clearly describes the item and other pertinent details of the proposed expenditure.

FS-10-F Final Expenditure Report

Now that we are using the FS-10-F Short Form, does that mean we don't have to keep detailed records?
Although only summary information is reported on the FS-10-F Short Form, there are no changes to the level or type of information agencies are required to maintain.  Supporting or source documents are required for all grant-related transactions entered into the agency's recordkeeping system.  The level of documentation must adequately support all grant expenditures.
We were notified that additional financial information must be submitted to the SED program office along with the final program report.  Since we already submitted the FS-10-F Short Form, can we disregard this notice?
No.  Some grant programs require specific information to be collected and reported to the granting authority, such as the U.S. Department of Education.  If the short form does not capture this information, SED program offices may require additional information be reported as part of their final program reports.
The FS-10-F Short Form - What does it mean for our Special Legislative Project?
The FS-10-F Short Form should be used to report your agency's final expenditures in accordance to the terms of your approved FS-10.  Your agency's disbursement records supporting the final expenditure report must continue to be maintained by your agency and be reported to this Department only upon request. The final program narrative, which is the written description of how the funds were spent, is a continued requirement for Special Legislative Projects.  Your final program narrative must accompany your FS-10-F Short Form. Additional questions regarding Special Legislative Projects should be directed to SED's Bureau of Budget Coordination at (518) 473-5733.
Our agency received a grant from SED, and we completed all the activities funded by the grant well before the end of the grant period. Can we submit an FS-10-F now, instead of waiting until after the grant period ends?
Yes, a final expenditure report can be submitted at any time during the grant period, as long as all expenditures funded by the grant have been made.
I am preparing the FS-10-F for a grant that ended about a week ago. I now realize that the expenses related to the grant do not closely match the approved budget. Can I submit an amendment with the final report so that we can get reimbursed for all the expenses we incurred?
No. Amendments are required to be submitted and approved prior to the end of the grant. An approved budget is an expenditure plan to carry out the purposes of a grant, and an amendment is the authority to incur obligations under a revised expenditure plan. To assure expenditures are made according to an approved plan, amendments must be approved prior to the end of the grant.
I am preparing the FS-10-F for a grant and realized that we made expenditures in the travel budget category without getting approval from SED. Can we claim funds in a category without approval?
Agencies may claim up to $1,000 without prior approval in supplies and materials, travel, purchased services, BOCES purchased services, and minor remodeling. All expenditures in salaries, equipment, and indirect costs must have prior approval. Agencies may claim expenditures in any approved category that are $1,000 or 10% more (whichever is greater) than the approved amount, as long as the total amount of the expenditures does not exceed the approved budget total. Of course, all expenditures must be allowable and consistent with the grant activities authorized by SED.
Our FS-10-F was submitted for less than the approved budget and we received our final payment over 90 days ago. I now realized I could have charged other expense items to this grant. Can I amend the final and claim the additional expenses?
Grantees have 90 days once a project is audited and closed to reopen a project for further review. Only in extreme or unusual circumstances will SED waive this rule.

Purchased Services

We are preparing a budget for the new year and are having difficulty breaking out the planned expenditures according to specific categories of expenses.  Since our agency will be providing the services, can we report all or some of the costs in Purchased Services (Code 40)?
Purchased services costs generally include only those costs purchased from another entity.  Grant recipients cannot contract or purchase services from themselves.  However, agencies that have a Cost Allocation Plan that complies with Federal cost principles may charge the appropriate Central Services Costs in Purchased Services (Code 40).  For more information on Cost Allocation Plans, refer to Policy Advisory #01-01 - Allocating and Billing Central Service Costs to Grants.
We will be using some of our grant money to pay for mailing and courier service. What code should be used for these costs?
Courier service costs and any metered postage costs should be included in code 40, Purchased Services. Generally stamps are purchased out of a petty cash fund and should be included as Supplies and Materials, code 45.
We have been placing association memberships, shipping charges, and faxing and telephone (including teleconferencing) expenses in code 45, Supplies and Materials. Is this correct?
Memberships, shipping charges, and costs of faxing and telephones should be reported in code 40, Purchased Services.

Equipment

We reviewed the policy advisory that defines equipment as items costing $5,000 or more and having a useful life of more than one year.  Since our agency has a policy to capitalize all equipment items costing $1,000 or more, can we still include those items in the equipment category, Code 20?
No.  For grants and grant contracts awarded by SED, only those items with a unit cost of $5,000 or more can be reported in Code 20, Equipment.   Other items with a unit cost less than $5,000 must be reported in Code 45, Supplies and Materials.
Our agency's policy is to capitalize all equipment items costing $1,000 or more and having a useful life of one year or more.  Are we now required to change our policy to $5,000 or more because SED raised the threshold for equipment for grants and grant contracts?
No.  The responsibility and authority to establish the appropriate dollar threshold for capitalizing equipment for financial statement purposes resides with the local agency.  However, for grants and grant contracts administered by SED, items with a unit cost of $5,000 or more must be reported in Code 20, Equipment, and items with a unit cost of less than $5,000, must be reported in Code 45, Supplies and Materials, on budgets (FS-10s), budget amendments (FS-10-As), and final expenditure reports (FS-10-Fs).
Our agency requires all equipment items costing $500 or more must be included in the assets inventory.   Since SED has defined equipment to be items costing $5,000 or more and having a useful life of more than one year, should we change our policy on assets inventory to include only those equipment items costing $5,000 or more?
No.  The Fiscal Guidelines for Federal and State Grants require organizations to maintain an inventory list for equipment with a unit cost of $5,000 or more that are purchased with grant funds.  However, organizations should have a policy that establishes the dollar minimum for equipment or groups of equipment that must be included in their inventory of capital assets.  The local governing board should determine what represents a significant value and set the minimum accordingly.  It is expected that the dollar minimum would be established to adequately safeguard the local agency’s assets.  SED’s reporting requirements for equipment purchases for grant projects should not be a determining factor when the dollar minimums are established.  Most often, the dollar minimum for equipment inventory and the dollar threshold for reporting equipment items for grant purposes will differ.
Where do we report items such as computer components that were purchased as part of a system?  The individual components have a unit cost of less than $5,000 but the cost of the complete system is more than $5,000.
If the components of the computer system make it usable for the purpose for which it was acquired, the total cost of the system must be used in determining whether it is reported as Code 20, Equipment, or Code 45, Supplies and Materials.
Our agency purchased equipment using federal education funds, and the equipment is now outdated and of no use.  Can we dispose of it, and if so, how do we document that?
The requirements for disposing of equipment used for federal activities depend upon the value of the equipment. According to U.S. Department of Education's General Administrative Regulations (EDGAR), if the equipment is no longer needed for federal program activities or is obsolete, it may be sold or discarded without compensation to SED. However, if the current per unit market value of the equipment is more than $5,000, SED has a right to its share of the current market value or the proceeds of a sale. Regarding documentation of equipment disposal, all agencies must maintain an inventory of equipment that includes information regarding sale, disposal, or transfer to another program. Additional information about equipment inventories is available in our Fiscal Guidelines for Federal and State Grants .

Indirect Costs

Can you explain what indirect costs are?
Indirect costs are costs of activities that benefit more than one program or objective and, therefore, cannot be readily assigned to only one specific program or objective. They are generally classified under functional categories such as general maintenance and operation expenses, general office and administration expenses, general overhead expenses, and other allowable general expenses.
I am preparing a budget for the upcoming school year. How can I find out what the indirect cost rate is for my agency?
A notification letter is sent annually to each school district and BOCES when the rates are calculated. You may contact Grants Finance at grantsweb@mail.nysed.gov or (518) 474-4815 if you are unsure of your rate.
How was our indirect rate calculated?
SED calculates the indirect cost rate for public schools and BOCES using data reported on State Aid ST-3 or SA-111 forms, respectively, using a methodology approved by the U.S. Department of Education. The rate for colleges and universities is set by federal guidelines. The indirect cost rate for all other agencies is set based on an average developed from data reported by school districts.
The indirect cost rate for my agency is very low. Is it possible to receive a higher rate?
Agencies that are not a school district, BOCES, or included in the category of colleges and universities can request a higher rate by completing and submitting an application to appeal form (FS-87-R). Presently, the maximum rate is 8%. To request a form, contact Grants Finance.
Can you explain the difference between an unrestricted indirect cost rate and a restricted indirect cost rate?
Restricted rates are established for use on programs that prohibit supplanting, where funding is intended to "supplement and not supplant" other State or local funding. The restricted rate filters out costs that would be incurred by the agency whether or not any particular grant program was in operation. The restricted rate is currently used for all State and federal grant programs flowing through SED, such as Title I. Unrestricted indirect cost rates are used with school food service programs and may also be used by local agencies on certain direct-funded federal programs.
Can I budget indirect costs for all of my grants?
Although for most grants indirect costs are an appropriate cost of a grant, there are some that prohibit indirect costs from being charged or limit the amount that may be charged. If you are unsure of the applicability of indirect costs for a specific grant, you should inquire with the program office responsible for that grant.

Central Service Costs

Can you explain what Central Service Costs are?
Central services costs are the costs of those common services that are provided to two or more units of an organization that benefit from the service. Often central services include, but are not limited to, such services as printing, mailing, computer and technical support, and purchasing.
Our agency allocates costs of some central services such as printing and computer support to the programs that benefit from the services. Can we include them in Purchased Services, code 40?
Central service costs can be included in code 40, Purchased Services, if the agency has a Cost Allocation Plan that meets the conditions listed in Policy Advisory #01-01 - Allocating and Billing Central Service Costs to Grants
Can you explain the difference between Central Service Costs and Indirect Costs?
Generally, central service costs benefit a certain group of programs or units whereas indirect costs benefit the organization as a whole. Often, particular services are common to both categories, and some part of the total costs may be included in the central services costs and the remainder included in the indirect costs. The costs cannot be duplicated and the allocation of indirect costs or central service costs must not result in an over-recovery of cost.

Salaries, Compensation, Fringe Benefits and Related Issues

Our district finally completed contract negotiations with the teachers association and retroactive raises for prior school years were included. We are paying the raises this year, and we have sufficient funding available in this year's grant budget to cover the costs. Can we charge those retroactive raises to this year's grant?
Usually retroactive pay is additional money payable in the current year for services provided in a prior year. If that is the case, the cost attributable to a prior year would not be allowable in your current year grant budget. The only salaries allowable in this year's grant are for work performed this year. It is possible that a contractual agreement would explicitly call for a bonus payment that may be calculated based on a prior year's salary but is not attributable to the service provided during the prior year. If you could demonstrate that this is the case, then the charge could be allowed in the current year.
Our 10-month employees are paid stipends for participating in grant activities during the summer. Our business office policy states that only staff receiving fringe benefits may be placed in codes 15, Professional Salaries, or code 16, Support Staff Salaries. Can we report these payments in code 40, Purchased Services?
Compensation for services paid to an employee must be reported as salary in code 15, Professional Salaries, or code 16, Support Salaries, depending on the services provided. An agency cannot pay its employees in code 40, Purchased Services. However, Purchased Services is the appropriate code for employee tuition or tuition-related costs.
Our agency has part-time and temporary substitutes. Can we report the costs of the substitutes in code 40, Purchased Services?
Substitutes are generally employees of an agency. Employees can be permanent or temporary, part-time or full-time, paid per diem or per hour. Payments to the substitutes must be reported as salary in code 15, Professional Salaries, or code 16, Support Staff Salaries. If the substitute is not an employee, the payments should be reported in code 40, Purchased Services.

Travel Costs

Occasionally, student participation on field trips is part of our grant program. We contract with a bus company for transportation, and we pay admission costs and meal expenses for the students. Is code 40, Purchased Services, the proper code for these expenses?
Code 46, Travel Expenses, specifically includes pupil transportation expenses and conference costs. It also includes other costs related to student participation in educationally-related field trips.
A requirement of one of our grant programs is attendance at national and/or State conferences and other workshops; very often these necessitate advance reservations and extensive travel by our staff.  Although these conference/training costs are allowable under the grant, exactly what costs can be charged to these grants for reimbursement?
Allowable travel costs are defined in the OMB Circular A-87-Cost Principles for State, Local, and Indian Tribal Governments as “expenses for transportation, lodging, subsistence, and related items incurred by employees traveling on official business.” For grants and grant contracts, these expenses should be reported in code 46, Travel, on the proposed project budget (FS-10 or FS-20) and on the final expenditure (FS-10-F) forms. Any costs to be reimbursed with federal and/or State grant funds must meet the general criteria (necessary, reasonable, etc.) as outlined in U.S. Department of Education’s General Administrative Regulations (EDGAR) and summarized in SED’s Fiscal Guidelines for Federal and State Grants.  In addition, EDGAR stipulates that encumbrances must occur during the approved funding period of the project. For travel, the encumbrance is made when the travel is taken.
Our grant runs July 2006 through June 2007.  We are required to attend a conference in July 2007.  Can we pay for the travel expenses out of the 2006-07 budget?
Consistent with the EDGAR requirements cited above, costs for travel in July 2007 would not be appropriate in a budget that ended in June 2007.   Costs for travel in July 2007  should be part of the July 2007–June 2008 budget.
We can save money if we pay in advance for some travel costs.  Can we pay the costs now and charge the correct grant later on?
Business office and program office staff would need to consider if this option would be appropriate.  Local policies and procedures need to be considered as well as matters of cash flow and risk management.

Other Issues

Occasionally, outside consultants are used to conduct workshops. We pay their travel expenses, and we provide workshop materials. How should these expenses be reported?
Generally, consultant fees are reported in code 40, Purchased Services. If the consultant's travel costs are paid separately, they should be reported in code 46, Travel Expenses. Workshop materials provided by your agency may be included in code 45, Supplies and Materials.
Can small "favors" (e.g., pens, notepads) be purchased and given away under federal and State grants?
These items should not be charged to grants because they are not necessary and reasonable for the proper administration of the grant. In addition, the State Comptroller has determined that "favors" represent gifts of public funds which are unallowable under the State Constitution.

Last Revision 12/30/08