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July
2007 Reimbursable Cost Manual
I. COST PRINCIPLES:
II. RECORD KEEPING:
A. Record Keeping
B. Accounting Requirements
C. Definitions
III. METHODOLOGY:
V. APPENDICIES:
VI. TOPIC APPENDIX:
The University of the State of New York
The State Education Department (SED)
Office of Management Services (OMS)
Rate Setting Unit (RSU)
Albany, New York 12234
Reimbursable Cost Manual for Programs
Receiving Funding Under Article 81 and Article 89 of the
Education Law to Educate Students with Disabilities
This Manual Applies to the July 2007 to June 2008 Tuition
Rates and Defines Reimbursable Costs for the July 2007 to June 2008 Period
.
July 2007 Edition
TABLE OF CONTENTS
Introduction 3
I. Cost Principles
5
II. General Requirements and
Definitions
Record Keeping
38
Accounting
Requirements 41
Definitions 43
III. Tuition Rate-Setting
Methodology
Tuition Rate-Setting
Methodology for Tuition Rates 50
Tuition Rate Adjustments
50
Close-Down Policy and
Procedures 51
V. Appendices 56
A-1. Categorization of
Expenditures 56
A-2. Categorization of
Revenues68
B. Purchasing Consortia69
C. Travel Guidelines 61
D. Guidelines for
Development, Review and Approval of Capital Projects
for Students with Disabilities 62
E. Statement on the
Governance Role of a Trustee or Board Member 67
VI. Topic Appendices
A. Select Regulations of
the Commissioner of Education 72
B. Best Practices for Boards
to Follow 72
C. Top Ten Warning Signs for
Boards 73
D. Links to Web Sites 76
E. Contact Offices in SED by
Type of Institution 77
INTRODUCTION
THIS JULY 2007 REIMBURSABLE COST MANUAL DEFINES REIMBURSABLE COSTS FOR
THE JULY 2007‑JUNE 2008 SCHOOL YEAR. IT APPLIES TO THE 2007-08
PROSPECTIVE TUITION RATES AND THE - 2007-2008 RECONCILIATION ADJUSTMENT
FACTORS AND RECONCILIATION RATES, AND FINAL AUDIT RATES BASED ON - 2007-2008
ACTUAL DATA.
This July 2007 Reimbursable Cost Manual (Manual) applies
to programs receiving public funds for educating students with disabilities
ages 3-21 in private schools, special act school districts (SASDs), Boards
of Cooperative Educational Services (BOCES), public school districts,
and municipalities under Articles 81 or 89 of the Education Law.
Approved programs should recognize that information in financial reports
is continually being analyzed and any part of this Manual may be modified
from year to year based on that analysis. Continuous review by the NYS
Education Department (SED), other State agencies, the State Division of
the Budget (DOB) (as mandated by the Institution Schools Act), and by
municipalities providing funding to programs under section 4410 of the
Education Law may also result in modifications. Since this Manual
is revised and updated on a periodic basis, questions arising about a
subject not described herein will be reviewed by SED and treatment of
such subjects may be described in the subsequent edition of the Manual.
Final costs are determined upon field audit and will be considered for
reimbursement provided that such costs are reasonable, necessary and directly
related to the education program. Costs must also have adequate
substantiating documentation. Designation of a cost as reimbursable
during the initial rate-setting process or during the reconciliation process
does not mean that the cost will be reimbursed through the final audit
rate since all rates are subject to adjustment on field audit, in accordance
with section 200.18 of the Commissioner's
Regulations and this Manual. A more detailed review of expenditures
during an audit may reveal that costs reimbursed during a prior rate calculation
for that fiscal year should not be reimbursed. Programs will be
given an opportunity to review and comment on the draft audit report before
the report is made final in accordance with section 200.18 of the Commissioner's
Regulations.
Section I, Cost Principles,
describes costs SED considers reimbursable in the
calculation of tuition rates for approved programs.
Section II, General Requirements and
Definitions, provides information on recordkeeping
requirements, general accounting standards and definitions
for programs receiving reimbursement under Articles 81 and
89 of the Education Law.
Section III, Tuition Rate-Setting
Methodology, provides information on rate setting,
adjustments and closedown.
Section IV, the Index, provides an
alphabetical listing of subjects described in this
publication.
Section V, the Appendices contain
supplementary information. Special attention should be given to Appendix
A-1, "Categorization of Expenditures" and Appendix
A-2, "Categorization of Revenues" that identify specific
items of expense and revenue. They also provide direction as to
where the cost categories should be reported on the CFR. Please
be advised that reimbursement of expenses designated as nondirect care
expenses will be subject to the nondirect care cost parameter.
SECTION I.
COST PRINCIPLES
Generally, costs will be considered for reimbursement provided such costs
are reasonable, necessary, and directly related to the education program
and are sufficiently documented. Such reimbursable costs will be
included in the calculation of tuition rates up to any limits or cost
screens approved annually in the rate-setting methodology.
1.
Accounting
Costs of establishing and maintaining accounting and other information systems
required for management of Articles 81 and 89 funded programs are reimbursable
and subject to the nondirect care cost parameter. When consultants or the
program's independent CPA firm, provide these non-audit services, refer to Section
I Item #15 on Consultants for reimbursement standards. (See Section
II A.3, General Requirements, Consultants, of this Manual for specific details
on record keeping requirements).
2.
Administration
A. Administrative costs
include salary and fringe benefit costs of
persons whose primary function is management
and administration of the program and/or
agency, in accordance with Federal and State
laws, Regulations of the Commissioner of
Education and/or the Board of Directors. All
administrative costs are subject to the
nondirect care cost parameter.
B. Administrative costs
may include, but are not limited to:
other-than-personal-services costs of
professional dues and conferences; travel;
telephone; office equipment and supplies;
bonding of employees handling program funds;
fees for lawyers, accountants and
consultants; charges from parent
organizations; personnel advertising and
other recruiting costs; minimum corporation
franchise tax or similar business tax;
postage; office equipment rental or
depreciation; repairs and maintenance;
depreciation on assets related to
administration; administrative purchase of
services; dues; licenses and permits;
subscriptions and publications; interest on
operating loans; administrative staff
development; and membership in civic,
business, professional or technical
organizations.
3.
Advertising
Advertising means the costs
associated with publications and other public
relations endeavors using the mediums of newspapers,
internet websites, magazines, radio and television
programs, direct mail, trade papers, and the like.
Outreach activities, such as
publications and other public relations endeavors
which describe the services offered by approved
private schools enabling them to better contribute
to community educational objectives, are
reimbursable. The intended outcome of these
publications and public relations endeavors should
be that of providing information and not for the
purpose of recruiting students into programs or
soliciting fund raising monies or donations. New
York State places students without regard to
advertising or public relations activities. (Refer
to Item #40, Recruitment of
Personnel.)
Guidelines for Preschool Program
Advertising:
A. Chapter
474 of the Laws of 1996 amended Section 4410 of the
Education Law to require the SED to
establish guidelines for advertising by
preschool programs and evaluators. The
following guidelines have been developed
pursuant to the Statute and corresponding
amendments to the Regulations of the
Commissioner of Education.
These amendments also
require preschool programs and evaluators to
submit upon request copies of advertising to
the SED for review. However, neither the
Statute nor the Regulations require approved
programs to advertise. Advertising costs for
the purpose of recruiting students into
programs or soliciting fund raising monies
or donations are not reimbursable and
remain nonallowable in the calculation of
tuition rates.
If you have any
questions, please call the Policy
Development Unit of VESID - Special
Education Policy and Quality Assurance
Office at (518) 402-3353.
B. Advertisements should include:
- Clear identification that
the program is for preschool children
who have or are suspected of having a disability
pursuant to Section 4410 of Article 89
of the Education Law;
- A statement that any
services provided are based upon the
individual needs of the preschool child
found to have a disability, as determined
by the Committee on Preschool Special Education
of the local school district;
- A statement that the
local school district will determine
the location where needed special education
services will be provided, which may
be the child’s normal daytime setting;
- A statement that parents
are responsible for arranging for and
paying the costs of any child care.
C. The following are appropriate
contents of advertising:
- A description of special
services available: evaluation, special
education, speech therapy, occupational therapy, physical therapy
and labeled as special education services;
- A description of the
appropriate licensure and/or certification
of staff employed;
- A statement that
indicates that the special education
services are at no direct cost to the
parent, but that funding is provided
through county taxes and state funds, earmarked for
special education services provided;
- A statement that
transportation may be a service provided,
but, parents are encouraged to transport their own children and
may be reimbursed at a rate per mile or a public service fare
established by the municipality and approved
by the Commissioner.
D. Advertisements should not
include:
- Information, which would
mislead a parent to believe their child,
can receive, at no cost to them, day care
services or any and all services the
agency has to offer.
- Information which would
mislead a parent to believe that the
decision regarding appropriate services and
where services will be provided is based
solely upon what the parent/or the provider requests;
- Information which would
indicate that services are "free" since
services are paid through local and state
funds;
- Information which would
indicate that transportation is always
provided;
- General statements that
would lead the reader to believe that
this is something other than a special education
program (i.e., are you concerned about
your children – come see us);
- Any information, which
would be false, deceptive or fraudulent
with respect to the services to be provided to
preschool children and their families.
4.
Assistive Technology Devices and Services*
An assistive technology device is
defined as "any item, piece of equipment, or product
system, whether acquired commercially, off the
shelf, modified or customized, that is used to
increase, maintain, or improve the functional
capabilities of a child with a disability." (34 CFR
300.5)
An assistive technology service
is defined as "any service that directly assists a
child with a disability in the selection,
acquisition, or use of an assistive technology
device." (34 CFR 300.6)
A.Preschool Children
Under the preschool
system, an approved program would make
available and be responsible for, in most
situations, high and low assistive
technology devices as part of its
instructional program and be reimbursed, as
part of the tuition rate, through the
Department's current rate-setting
methodology. When a child-specific assistive
technology device is required, the county in
which the child resides purchases or leases
the device and submits costs to the
Department on a STAC-1 form. The assistive
technology device should be identified on
the related service line of the form.
Counties must contract
with assistive technology service providers
and must submit the contracted rate for such
services on the annual County List of
Approved Rates for Related Services
(SED-RS-3).
B. School Age Children
When the school district
that is programmatically responsible for the
student, purchases or leases equipment
specified on the IEP, the cost is not
reimbursable in the tuition rate.
*The above information is
referenced from Thomas Neveldine's memo of September
1995 regarding Assistive Technology Devices and
Services and
Guidelines to Allow for the Transfer of Assistive
Technology When a Student Moves from School
Jurisdiction to Higher Education, Other Human
Services Agency or Employment.
5. Auditing
The cost of certified audits
necessary for the administration and management of
Articles 81 and 89 funded programs is
reimbursable subject to the limitations and
requirements for consultant services (Refer to
Item #15 on Consultants).
6. Bad Debts
Bad debt expenses are not
reimbursable. Actual or estimated losses resulting
from uncollectible accounts or other claims,
including related finance charges are not
reimbursable operating expenses for Articles 81 and
89 funded programs. Collection and legal expenses
for collecting bad debts are reimbursable subject to
the nondirect care cost screen parameter.
7.
Bedding/Linen
Costs of bedding and linens are
not reimbursable as an education expense. Such costs
are considered to be parental responsibility or
residential expenses. However, bedding, linen and
towels for the nurse's office and for the classrooms
will be considered reimbursable.
8. Bonding
Costs of insurance premiums on
bonds covering employees who handle program funds
are reimbursable and subject to the nondirect care
cost parameter.
9. Capital
Expenditures
(A) SASDs, public school
districts and BOCES are required to comply
with GASB 34 and depreciate the cost of
buildings, equipment, furniture, fixtures or
vehicles over the useful life of such
assets. Public school districts and BOCES
must adhere to the applicable sections of
the General Municipal Law, which govern
Capital Expenditures. SASDs may choose to
renovate existing buildings or purchase
equipment, furniture, fixtures or vehicles
by transferring funds from the General Fund
to a Capital Project or Capital Expenditure
Fund as discussed in section (B) below:
(1) Renovations
of existing buildings: Costs of
renovations, alterations, or major
repairs must be approved by the
District Board in accordance with
the District's annual approved
budget policy. Proposals for
renovations, alterations or major
repairs must be submitted to the SED
for review and comment. See
Appendix D:
Guidelines for Development, Review
and Approval of Capital Projects for
Students with Disabilities.
(2) Purchases of
furniture, fixtures or equipment:
For proposed purchases of equipment,
furniture, and fixtures, three (3)
estimates must be provided for items
which cost more than $1,000 and have
a useful life of more than two
years.
(3) SASD’s have
no voters or bonding authority and
are not considered component school
districts within the meaning of
Section 1950(14) of Education Law
for the purpose of participation in
funding of BOCES capital projects,
without the prior written approval
of SED and the New York State
Division of the Budget.
(4) Consistent
with the provisions of
Chapter 383 of the New York State
Laws of 2001, SASDs and public
school districts are authorized
access to the Dormitory Authority of
the State of New York (DASNY) for
financing and refinancing of bonds
for school construction projects.
SASDs and public school districts
are further authorized to structure
financing of capital projects
consistent with the payment of
building aid based on assumed
amortization of debt service
payments in accordance with the
useful life of the project.
(5) SASDs, public
school districts and BOCES are
required to fully access available
Building Aid funding for all capital
projects. Failure to apply for
Building Aid funding will result in
an adjustment to approved capital
costs to reduce reimbursement
through the tuition rate to the
level of funding that would have
resulted if the provider had applied
for Building Aid.
(6) The
New York State Uniform Fire Prevention and
Building Code applies certain
standards to new work involving
conversions, alterations, additions
or repairs to any building owned
or operated by a special act school
district or a public school
district. For construction costing
up to $5,000, the school district
board must assure compliance with
the code. Between $5,000 and
$10,000, the school district board
has the responsibility to assure
compliance and to retain a licensed
architect/engineer to prepare
plans and specifications and provide
supervision. For costs over $10,000,
or affecting health and safety,
the school district board is responsible
for assuring compliance and
retaining the architect/engineer
to prepare plans and specifications
to be submitted for approval and
a building permit to the New York
State Education Department, Office
of Facilities Planning, Room 514W,
Education Building, Albany, New
York 12234. For more information,
please visit the website at
http://www.emsc.nysed.gov/facplan/.
(B) Interfund transfers
will be recognized in the tuition rate
calculation process under the following
conditions:
(1) In cases
where there may be several transfers
between funds, costs will only be
reimbursed once in the tuition
rate-setting process.
(2) Proposed
transfers from the General Fund to
the Capital Fund or additions to the
Capital Fund will be recognized in
the tuition rate calculation if RSU
fiscal review determines prior to
the transfer of funds, that
transfers or additions result from
the need to fund capital projects.
Such projects must have been
approved by resolution of the SASD
Board and endorsed by the SED.
RSU staff will
consult with the Department of
Facilities Planning and/or State Aid
Unit staff during the review
process. Districts should submit
copies of proposals to Facilities
Planning staff and to the RSU.. RSU
staff review will confirm in writing
that amounts to be transferred are
reasonable and made at appropriate
times during the completion of the
project.
(3) When the
Trust and Agency fund is used as a
clearinghouse for expenses,
transfers from the General Fund to
the Trust and Agency Fund will be
recognized in the rate calculation
process, if consistent with regular
District practice and in compliance
with this Manual. However, transfers
from the Trust and Agency Fund back
to the General Fund will be offset
in rate calculations, if the costs
have already been included in a
tuition rate.
(4) When a
capital project(s) is completed and
the Capital Projects Fund has a
surplus, then a transfer(s) from the
Capital Projects Fund to the General
Fund is required. The transferred
amount will be offset in rate
calculations, if the previous
transfers to the Capital Project
Fund have already been included in a
tuition rate. Interest income earned
by Capital Projects Fund and
retained in this fund will be offset
in the tuition rate calculations to
the extent it was not previously
offset in tuition rate calculations.
(5) Transfers to
Contingency funds are not
reimbursable in the calculation of
tuition rates. See
Item #16
Contingency Provisions for
additional information.
(C) All other providers
should also refer to
Item #18 on Depreciation/Amortization in
this Manual.
10. Charges
from Parent or Related Organizations
Charges to programs receiving
administrative services, insurance, supplies,
technical consultants, etc. from a parent or related
organization are reimbursable provided they are
based on actual direct and indirect costs, allocated
to all programs on a consistent basis, and defined
as reimbursable in the Regulations of the
Commissioner of Education, the CFR Manual or this
Manual. (Refer to Section II. C.
Definitions, Item 4, in this Manual for
less-than-arm's-length (LTAL) transactions.)
11.
Students' Activities
A. Costs incurred for
intramural activities, student publications,
student clubs and other student activities,
to the extent such activities are normally
provided by public day schools, are
reimbursable direct care expenditures.
Reasonable costs of class field trips during
school hours and extra-curricular activities
after school hours are reimbursable as
direct care expenditures.
B. Ordinary living
expenses such as the cost of overnight class
trips or other expenses that are normally
assumed by parents of students attending
public day schools are not reimbursable.
C. Costs incurred for, or
in support of, alumni activities and similar
services are not reimbursable.
12.
Clothing/Uniforms
Ordinary living expenses, such as
the cost of clothing and uniforms that are normally
assumed by parents or legal guardians of students
attending day care centers or public day schools,
are not reimbursable. Clothing expenses for staff
such as uniforms for custodians or bus drivers, even
if required by school policy, are not reimbursable.
Such costs are considered to be personal expenses.
13.
Commencement and Convocation
Costs of commencement and
convocation activities are reimbursable when they
are consistent with local public school districts.
14.
Compensation for Personal Services
Compensation for personal
services includes all salaries and wages, as well as
fringe benefits and pension plan costs. Accrued
vacation/sick leave is not reimbursable.
Payments for vacation/sick leave, including lump
sum payments made upon retirement that are required by
law or by employer-employee agreement and meet the
criteria listed in item (B) below, are reimbursable when paid and reported
in the 2006-07 financial reports. (Refer also to Section
II. General Requirements and Definitions, Item A.1.
Record Keeping - Payroll).
A. Salaries
Salaries include all
taxable and non-taxable salaries and wages
paid or accrued to employees on the agency
payroll, including severance pay to regular
employees. Reimbursement of salary expense
shall be subject to the following
principles:
(1) Entities operating
approved programs shall develop
employer-employee agreements with
written salary scales and issue them to
employees
(2) Base year
salary expense will be inflated at
an amount approved by the State
Division of Budget for the purpose
of establishing a level of
reimbursable costs on which to base
the per pupil tuition rate
calculation.
(3) Payments for
sick and vacation leave credits for
a retiring employee transferred into
a lump sum payment to the employee
are reimbursable when reported and
paid in the 2006-07 financial
reports and when documented in
employer-employee contract
agreements.
(4)(a)
Compensation (i.e., salaries plus
fringe benefits) for the entity's
executive director, assistant
executive director and chief
financial officer will be directly
compared to the regional median
compensation for comparable
administration job titles of public
school districts, as determined and
published annually by SED's Basic
Educational Data Systems (BEDS).
Reimbursement of employee
compensation for these job titles
shall not exceed the median paid to
comparable personnel in public
schools for similar work and hours
of employment in the region in which
the entity is located. Compensation
for an "Executive Director"
providing services to an Article 81
and/or Article 89 funded program
will be compared to the median
"Superintendent-Independent"
compensation for the region in which
the entity is located and
compensation for an Assistant
Executive Director and Chief
Financial Officer will be compared
to the median compensation for
"Assistant Superintendent."
(4)(b) For any
individual who is employed in any
job title or combination of job
titles by the entity operating the
approved programs, compensation up
to 1.0 FTE for that individual in
total, will be considered in the
calculation of the portion of 1.0
FTE reimbursable in the tuition
rates, subject to the limitations
defined in (4)(a) above.
(4)(c) An entity
that employs co-executive directors
shall have total reimbursement for
all co-executive directors
combined limited to a level
commensurate with a 1.0 FTE
position. This level will be the
maximum compensation level for the
entire entity operating the approved
programs.
(4)(d) For any
individual who works in more than
one entity (including organizations
that have a less-than-arm's-length
relationship with the approved
program), and whose FTE in total
across entities exceeds 1.0, the
allocation of compensation must be
supported by time and effort reports
or equivalent documentation which
meets the following standards:
- they must
reflect contemporaneous time
records of the actual activity of each employee;
- they must
account for the total activity
for which each employee is compensated;
- they must be
prepared at least monthly
and coincide with one or more pay
periods;
- they must be
signed and dated by the employee
and employee’s supervisor .
- budget
estimates or other allocation
methods determined before the services are performed are not
adequate documentation for
use in completing annual financial
reports but may be used for
interim accounting purposes;
Compensation
beyond 1.0 FTE for any individual in
total will not be considered
reimbursable in the calculation of
tuition rates.
(4)(e) Direct
care student to staff ratios shall
not exceed the approved staffing
levels supported by SED’s program
approval letter. Any net excess of
staff will not be included as part
of reimbursable costs in the tuition
rate. Such additional staff may be
deemed reimbursable upon
demonstration to the satisfaction of
the Commissioner that such costs
were necessary.
(5) Reimbursement
of all employee compensation,
including administrative job titles
shall not exceed the levels paid to
comparably qualified and
appropriately certified personnel in
local public schools for similar
work and hours of employment. Any
net excess compensation will not be
included as part of reimbursable
costs in the tuition rate
calculation.
(6) Compensation
to all individuals including
shareholders, trustees, board
members, officers, family members or
others who have a financial interest
in the program and who are also
program employees must be
commensurate to actual services
provided as program employees or
consultants and shall not include
any distribution of earnings in
excess of reimbursable compensation.
For all individuals, compensation
for board service or trustee service
is not reimbursable. For
example, a full-time program
employee may serve on the Board of
Directors of the agency. However,
compensation for board service will
not be reimbursed. Compensation for
such employee's personal service to
the program will be allowed in the
computation of the tuition rate if:
- The
board member abstains from
any discussion or vote
on matters related to
his/her compensation and
the Board minutes reflect this.
- The
board member has not
been employed by the State
Education Department
within two (2) years of his/her
appointment to the
Board.
(7) Expenses of a
personal nature, such as a residence
or personal use of a car, known as
perquisites (or perks), are not
reimbursable. When costs are
disallowed because they are of a
personal nature, providers should
inform the employee(s) in writing,
that the employee(s) must refund the
disallowed costs to the provider
within a date certain. If the
employee(s) fails to do so, the
amount should be recovered through a
reduction in compensation.
(8) Compensation
paid to an employee(s), which serves
to duplicate worker's compensation
awards, jury fees or disability
claims are not reimbursable.
(9) The estimated
value of donated services is not
reimbursable. (Refer
to Item #24 on Fund-raising).
(10) Expenses for
compensation of overtime work for
direct care and nondirect care staff
that are compensated on an hourly
basis are reimbursable subject to
all applicable statutes, rules and
regulations of the NYS Department
of Labor. Overtime compensation for
salaried direct care staff for
extracurricular activities such as
coaching stipends, extra period
coverage, plays, etc. are
reimbursable when documented in the
employee's contract and if they do
not exceed local school district
compensation for such activities.
Overtime for all others is not
reimbursable.
(11) Bonus
compensation shall mean a
non-recurring and non-accumulating
(i.e., not included in base salary
of subsequent years) lump sum
payment(s) in excess of regularly
scheduled salary which is not
directly related to hours worked.
Bonus compensation may be reimbursed
if based on merit as measured and
supported by employee performance
evaluations. Bonus compensation
restricted to only administrative
staff is not reimbursable.
Bonus compensation shall be subject
to all aspects, constraints and cost
screens contained in the
methodology. Bonus compensation
specifically relating to grant
awards for targeted enhancements of
teacher compensation is
reimbursable.
(12) Private
schools shall submit to the SED upon
request, proposed compensation
packages of the
owners/officers/partners whose
annualized compensation exceed
$75,000 or whose
owners/officers/partners are
employed in other businesses or are
the owners/officers/partners of
other businesses. Such arrangements
shall include the proposed salary
based on qualifications and actual
documented hours worked (time
sheets), and fringe benefits, as
well as a list of the other jobs
and/or businesses and the time
devoted to each. The package will be
approved/disapproved in writing by
the SED within 30 days of receipt
from the SED. Compensation will be
subject to median analysis in the
calculation of tuition rates as
described in this Manual and the
Commissioner’s Regulations.
B. Fringe Benefits
(1) Fringe
benefits may include paid time off,
such as vacation leave, sick leave,
military leave, holidays, training
and educational costs, provided the
benefit is established by written
school policy. Payments into
specific employee benefit packages,
such as teachers' retirement,
employees' retirement and pension
plans, Social Security, health
insurance, life insurance (to the
extent the Internal Revenue Service
does not require payment of such
premiums to be included in the
employee's income), unemployment
insurance, disability insurance,
union welfare funds, or pension plan
termination insurance premiums paid
pursuant to the Employee
Retirement Income Security Act of 1974, may
also be included.
(2) Reimbursement
of fringe benefit expenses shall be
subject to the following principles:
(a)
Vacation and sick leave are
reimbursable in the year
actually paid and reported
as a salary expense. Accrued
vacation and sick leave
expenses are not
reimbursable until actually
paid.
(b) Costs
of benefits for employees
who provide services to more
than one program and/or
entity must be allocated to
separate programs and/or
entities in proportion to
the salary expense allocated
to each program.
(c)
Benefits including pensions,
life insurance, and TSAs for
individual employees or
officers/directors are
proportionately similar to
those received by other
classes or groups of
employees.
(d)
Amounts paid or credited to
employees for sabbatical
leave will be reimbursed to
the extent that such leaves,
as reflected in
labor-management agreements,
are a prevalent practice of
the local public school
district.
(e)
Employer-provided
educational assistance costs
are reimbursable as
compensation only when the
course or degree pursued is
relevant to the field in
which the employee is
working. The employee must
complete and receive a
passing grade for the
course(s) for which the
employer/provider paid.
Appropriate records of
course completion must be
maintained by the
employer/provider. Such
costs are limited to tuition
charged by the educational
institution, textbooks, fees
and training materials.
Costs of specialized
programs specifically
designed to enhance the
effectiveness of executives
or managers are
reimbursable.
Employer-provided
educational assistance costs
will be considered
compensation to the
individual. Costs of
education or training
necessary for an employee to
meet minimum qualifications
for the position for which
he/she was hired are not
reimbursable.
C. Pensions
(1) Costs of
employer funded pension plans which
are approved by the Internal Revenue
Service and accounted for under
generally accepted accounting
principles (GAAP) are reimbursable
subject to the following exceptions
and limitations:
a.
Payments in lieu of pensions
made to or for the benefit
of school officers,
directors, presidents, etc.
are not reimbursable as a
fringe benefit but will be
considered as salary
expense.
b. IRA or
KEOGH plan payments made by
an entity for employees or
officers are not
reimbursable as a fringe
benefit as they are
individual in nature,
however, they will be
considered as salary
expense.
c.
Employer funded plans such
as 403(b) plans are
reimbursable if they qualify
under IRS Guidelines.
Employees' contributions to
such pension plans may be
reimbursable expenses as
part of reported gross
salaries.
d.
Self-Employed Retirement
Plans (Partnerships and Sole
Proprietorships) that are
qualified and
non-discriminatory, and
which include 70% or more of
the employees, are
reimbursable. Costs of plans
that do not include anyone
other than the owner or
owner's relatives will not
be reimbursed. In instances
where sole proprietors or
partners are not offered
plans, SED will allow the
Self Employment Tax
deduction allowed as an
adjustment to income on IRS
Form 1040 Income Tax Return.
In no case will SED allow a
charge for pensions that are
accounted for as a salary
deduction through
compensation paid to the
employee.
e. Where
funding requirements of the
Employee's Retirement Income
Security Act (ERISA) differ
from GAAP, an explanatory
note should be included in
the CPA financial
statements. Reimbursement
will be based upon GAAP
requirements. In addition,
the costs of any excise tax
imposed on accumulated
funding deficiencies are not
reimbursable.
f. Any
program decision to
terminate participation in a
pension plan must be
communicated in writing to
the RSU not less than 90
days in advance of the
proposed termination date
and should indicate the
reasons for termination and
plans for disposition of
funds in the pension plan.
g.
Supplemental Executive
Retirement Plans (SERP) are
discriminatory and
nonqualified by the IRS and
therefore are not
reimbursable.
(2) The following
principles shall apply concerning
pension plan asset reversion
transactions in which employers
received plan assets in excess of
plan obligations:
a. Net reversion assets
will be classified as offsetting revenues.
b. Net
reversion assets are the
reversion dollar amount
before any excise tax or tax
penalties are deducted.
c. Net
reversion assets will
include funds received from
pension plan termination
insurance proceeds.
d. The
net reversion assets must be
allocated to all programs
based on the employees who
participated in the pension
plan.
e.
Enhancing employee benefit
plans in such situations is
reimbursable.
15.
Consultants
Consultants include
independent accountants, as defined in
section 200.9 (e)(1)(ii)(a) of the
Commissioner's Regulations, lawyers and
other independent contractors. (Refer to
Section I
Item # 39 (A) on
Purchase of Services and
Section II. General
Requirements and
Definitions, A.3. Consultants).
Nondirect care consultant service costs are
subject to the nondirect care cost
parameter.
A. Costs of consultants' services
are reimbursable provided that:
(1) Fees
do not exceed the prevailing
rate for such services.
The school will maintain
documentation to support
the regional prevailing
rate at the time such
costs are incurred. (Refer
to Section II. General
Requirements Item A.3.
Record Keeping).
(2) The
services could not have been
performed by an
appropriately certified
school officer or employee
who possesses the necessary
technical skills or by SED staff. (Refer to Section II.
General Requirements Item
C.1. (a).
(3) Paid
consultants providing
services to approved
programs for students with
disabilities are not
officers or employees of
the entity, employees of the
State Education Department,
employees of municipalities,
or employees of other
private schools whose
positions are funded wholly
or in part by State or local
taxpayer funds.
(4)
Persons who have been
employed by the State
Education Department to
monitor or audit approved
programs for students with
disabilities are not
employed as consultants for
a period of two years
following State employment.
(5) Fees
and transactions meet
criteria for less-than-arm’s
length transactions when
applicable (Refer to
Section
II. C., Definitions, Item
4 in this Manual for L-T-A-L).
B. Costs of
legal, accounting or consulting
services, and related costs incurred
in connection with reorganization of
the agency, including mergers and
acquisitions, unless mandated by the
State Education Department, are not
reimbursable. Costs associated with
retainers for legal, accounting or
consulting services are not
reimbursable unless the fee
represents payment for actual
documented reimbursable services
rendered provided the services are
not for lobbying efforts. [The cost
of certain influencing activities
(lobbying) associated with obtaining
grants, contracts, cooperative
agreements, or loans are not
reimbursable.] Lobbying
activities include, but are not
limited to, advocating for
legislation and activities
associated with obtaining grants,
contracts, cooperative agreements,
or loans.C. Legal,
accounting or consultant costs that
result from claims or lawsuits
against an Article 81 and Article 89
funded program are reimbursable to
the extent not recoverable from
other parties. Claims against
non-Article 81 and non-Article 89
programs are not reimbursable
through the tuition rate.D. When an
audit/financial review is conducted
by a local school district, a
municipality or the State in
accordance with State law,
Regulations of the Commissioner of
Education, Municipal Law and this
Manual, any
legal/accounting/consultant costs
incurred as a result of proceedings
brought pursuant to Article 78 of
Civil Practice Law & Rules to
challenge the established tuition
rates are not reimbursable.E. Fringe benefit
costs for independent contractors or
consultants are not reimbursable.F. Costs
associated with non-audit services
provided by a registered public
accounting firm or any person
associated with that firm, during or
within 365 days of required audit
work (prior to the beginning of the
fiscal period being audited or after
the date of the audit report issued
for the audit period), are not
reimbursable. Such non-audit
services include:
- Bookkeeping or
other services related to the
accounting records or financial statements of the audit client;Financial
information systems design and
implementation;Appraisal or
valuation services, fairness
opinions or contribution-in-kinds
reports;Actuarial
services;Internal audit
outsourcing services;Management
functions or human resourcesBroker or dealer,
investment advisor, or investment
banking services;Legal services
and expert services unrelated
to the audit; and
- Any other service
that the Board of the provider
does not approve, or that the SED or
other governing State agency
does not approve as reasonable and
necessary, consistent with
applicable requirements and this
Manual.
16.
Contingency Provisions
Contributions to a contingency
reserve or any similar provision made for events
whose occurrence cannot be forecast are not
reimbursable.
17.
Contributions and Donations
Political and charitable contributions
and donations made by the program are not reimbursable.
18.
Depreciation/Amortization
Public school districts and BOCES
must comply with applicable sections of the General
Municipal Law and GASB
34. (Refer to Item #9 on
Capital Expenditures in this Manual).
A. Depreciation - Buildings, Furniture,
Equipment and Vehicles:
(1) Items having
a unit cost of $1,000 or more and
an estimated useful life of two
years or more must be capitalized.
Group purchases of similar items
(i.e., furniture, small tools,
etc.) or separate purchases of
similar items in the same fiscal year
totaling $1,000 or more should
be treated as a single unit purchase.
Costs of facility
acquisition or construction shall be
depreciated over the expected useful
life of the facility as indicated
in
Appendix O - "Guidelines for
Depreciation and Amortization" of the
CFR Manual. Cost of facility
acquisition or construction includes
architect and inspection fees and should
be included in the cost of the building
for depreciation purposes. Renovations
or alterations that are considered to
be directly related to the education
program and therefore reimbursable
through depreciation charges over the
estimated useful life of the renovation
or alteration as indicated in Appendix
O of the CFR Manual may include:
replacement of roofs, boilers, plumbing
systems, or similar repairs needed to
protect the agency's physical plant;
installation of safety devices, such
as fire exits, alarms or smoke detectors
in existing buildings; renovations
necessary to comply with New York State
standards of instruction; renovations
to protect the health or safety of New
York State students; and other capital
expenditures for minor renovation work.
Proposals for acquisition, new
construction, renovations, alterations
or major repairs must be submitted to
the Commissioner's designated program
and fiscal representatives for their
review and comment. Refer to
Appendix D for
guidelines on the development of capital
projects.
(2) A move to a new
location must be approved by SED
program staff prior to the move.
Moving costs are discussed in
Item #41 B. (1) on
Rent.
(3) The
straight-line method of computing
depreciation is required by SED
for all classes of assets. Provision
for estimated salvage value must
be made in accordance with generally
accepted accounting principles
when computing depreciation for
vehicles, furniture and equipment.
(4) Refer to
Appendix O in the CFR Manual for
the required minimum useful lives
of assets acquired on or after July
1, 1992 to be used in the computation
of reimbursable depreciation.
Deviation from this Appendix for
furniture, equipment and vehicles
may be granted by SED if the assets
in question were previously owned.
Modifications to reduce useful lives
from those indicated in this
Appendix must be requested in
writing to the Department for their
advance approval.
(5) Depreciation
based on reappraisals designed to
increase the cost basis for
depreciation is not reimbursable.
Accumulated depreciation on assets
transferred due to a change in legal
status of the owner, such as
incorporation, is not
reimbursable. Accumulated
depreciation on property owned by
a division, subsidiary or affiliate
of an entity prior to acquisition
by the entity will not be reimbursed
to the program after acquisition;
the remaining undepreciated cost
of the prior entity will be reimbursed
over the remaining useful life of
the asset as if no ownership change
occurred.
(6) The portion
of the cost of building
construction, acquisition,
renovation or equipment cost funded
by a government grant or other
public funding cannot be reimbursed
again through depreciation of
these costs. The asset cost must
be reduced by the amount of the
grant(s) and the balance depreciated
in accordance with this Manual.
(7) Depreciation
charges for donated assets are
reimbursable in accordance with (1)
through (6) above.
(8) If assets are
shared by more than one program
and/or entity, the share of
depreciation expense allocated to
programs funded pursuant to Articles
81 or 89 shall be based on
documented and reasonable criteria.
(9) Depreciation
charged for assets acquired through
approved Dormitory Authority
construction/renovation projects
is not reimbursable in a tuition
rate.
B. Amortization: Except
for Goodwill (Refer to
Item #25), intangible and tangible
assets such as leaseholds, leasehold
improvements, organization expenses, and
mortgage expenses must be amortized in
accordance with the following amortization
periods:
(1)
Leasehold/Leasehold Improvements
- Amortized over the useful life
of the improvements or the remaining
term of the lease, whichever is
shorter. Amortization expense
for leaseholds and leasehold
improvements will be reimbursable
only with the existence of a formal
written lease agreement. The term
of the lease includes any period
for which the lease may be renewed
or extended. In the absence of
an expressed option, past actions
on the part of the lessor and lessee
pertaining to renewal will be
considered in determining the
term of the lease for amortization
purposes.
(2) Mortgage
Related Expense - Expenses related
to purchasing or constructing
a facility such as attorney's
fees; recording costs; transfer
taxes; and service charges such
as finder's fees and placement
fees; etc. should be amortized over the term
of the mortgage.
(3) Organization
Expense - Amortized over a 60-month
period starting with the month
the program becomes operational
to provide educational services.
C. Start-Up Costs
(previously amortized) - Refer to
Section 1 Item #49 Start-Up
Costs.
19. Due
Process Costs for Preschool Students Served under Section
4410 of the Education Law
Due process costs incurred by
public school districts associated with educational
programs or educational services approved pursuant
to Section 4410 of the Education Law and Section
200.17 of the Regulations of the Commissioner.
A. General Public School
District Due Process Costs:
The following general due
process costs incurred by a public school
district are reimbursable, to the extent
reasonable and necessary:
1. Impartial Hearing
Officer (IHO) costs including the
hourly fee up to the maximum rate
developed by the Department and
approved by the Director of the
State Division of the Budget. The
number of hours of service must also
be submitted and reviewed for
reasonableness. Reasonable and
necessary travel costs incurred by
the IHO may also be reimbursable.
The Impartial Hearing Officer must
be on the Department’s list of
certified IHOs.
2. Court
Stenographer Costs at the impartial
hearing are reimbursable.
3. School District
Attorney Fees are reimbursable,
to the extent they are
reasonable, when incurred at the
impartial hearing, during review by
the State review officer or in a
judicial action or proceeding
brought by another party to review
the State review officer's
determination. Under the conditions
described below, school district
attorneys’ fees are reimbursable in
an action or proceeding brought by
the board of education. The district
must provide a contract or retainer
agreement that establishes the
hourly rate for the school district
attorney. Such hourly fees and
number of hours of service shall be
reviewed for reasonableness.
Reasonable and necessary travel and
other incidental costs, such as
photocopying, may be reimbursable if
documentation is presented. To be
eligible to receive reimbursement
for reasonable attorneys' fees in an
action or proceeding brought by the
board of education, the board of
education must demonstrate that:
(i) (a) The
board of education has not named
or joined the State nor any
State officer, department, board
or agency of the State (State
defendant) as a party to the
action or proceeding; or
(b) There has
been a judicial determination
joining one or more State
defendants as a necessary party;
and
(ii) The
board of education, upon final
disposition of such action or
proceeding, has received a
judgment in its favor annulling
the determination of the State
review officer.
B. Interim Special Education
Program or Service Costs paid for by the
parents between the time of the Committee on
Preschool Special Education meeting, which
precipitated the impartial hearing and final
resolution (whether a decision from an
Impartial Hearing Officer, State Review
Officer or a Court) are not reimbursable
unless the Impartial Hearing Officer, the
State Review Officer or the Court requires
the school district to reimburse the parents
for such costs in their decisions.
C. Parent Attorney Fees are
not reimbursable unless the parents prevail
in the final resolution (whether a decision
from an Impartial Hearing Officer, State
Review Officer or a Court) and the final
decision requires the public school district
to reimburse the parents for their attorney
fees.
D. Evaluation of the child
paid for by the parents as part of due
process activities is not reimbursable
unless the Impartial Hearing Officer, State
Review Officer or Court requires the public
school district to reimburse the parents for
such evaluation costs.
E. Application for the
reimbursable costs described in (A) through
(D) above shall be submitted upon final
resolution (whether a determination from an
Impartial Hearing Officer, State Review
Officer or a Court).
F. Documentation: The
public school district must provide complete
and detailed documentation of costs
requested for reimbursement. For each item,
the nature of the cost must be detailed, the
per hour cost and the number of hours must
be clear, as well as who performed the
service. Costs requested, but not
sufficiently documented will not be
reimbursed.
20.
Dues/Licenses/Permits
The costs of professional
dues, licenses and permits are reimbursable and are
subject to the nondirect care cost parameter.
21.
Entertainment Costs and Personal Expenditures
A. Costs incurred for
entertainment of officers or employees, or
for activities not related to the program,
or any related items such as meals,Section
I lodging, rentals, transportation, and gratuities,
are not reimbursable. (Refer to
Item #30 on Meetings and
Conferences and Item
#57 on Travel).B. All personal expenses,
such as personal travel expenses, laundry
charges, beverage charges, gift certificates
to staff and vendors, flowers or parties
for staff, holiday parties, repairs on
a personal vehicle, rental expenses for
personal apartments, etc., are not
reimbursable unless specified otherwise in
this Manual.
22. Fines and
Penalties
Costs resulting from violations
of, or failure by, the entity to comply with
Federal, State, and/or local laws and regulations,
are not reimbursable.
23. Food
A. The cost of food and
food related salary and fringe benefit costs
are reimbursable. Programs are strongly
encouraged to take full advantage of the
funding available through the following
sources:
1. National School
Lunch Program, the School Breakfast
Program and the Special Milk
Program. These national programs are
administered at the State level by
SED. Applications and further
information regarding child
nutrition or school food management
may be obtained by writing to the
New York State Education Department,
Child Nutrition Program
Administration, Room 55 , Albany, NY
12234-0055 or viewing the
New York State Child Nutrition
Knowledge Center website or by
calling (518) 473-8781.
2. The New York
State Department of Health,
Child And Adult Care Food Program -
CACFP For more information about
the program, call CACFP at
1-800-942-3858
B. For all approved
programs providing required meals to
students with disabilities, the following
principles shall also apply:
(1) When the
program subcontracts for food
services, the program shall employ
competitive
bidding practices.
(2) When the
program directly supplies meals, the
direct costs of food and food
preparation must be reasonable in
comparison to the prevailing market
for such services.
C. Costs of food provided to any staff
including lunchroom monitors are not reimbursable.
D. Food costs will not be
reimbursed for special education itinerant
programs unless required by the student’s
IEP as an instructional supply.
24.
Fund-Raising Costs
Costs of organized fund raising
(i.e., financial campaigns, endowment drives, or
solicitation of gifts and bequests) to raise
capital, or to obtain contributions are not
reimbursable. However, reasonable and necessary
costs associated with the procurement and retention
of donated services used for IEP mandated services
either directly or indirectly, may be reimbursable
as long as the program can demonstrate that cost
savings exist and that there is a direct benefit to
the students in the program through the use of such
donated services. These costs are subject to the
nondirect care cost parameter.
25. Goodwill
Goodwill, defined as the stated
value of a business in excess of its book value, is
not a reimbursable cost.
26. Grants
A. Costs of staff or
consultants to prepare a proposal to obtain
a government grant or to administer the
activities or projects funded by such grants
may be reimbursable within the tuition rate
as a nondirect care expense to the extent
that such costs remain net of all
administrative expenses allowed by the
grantor.
B. Any claimed excess of
actual government (Federal, State or local)
grant expenses over approved budgeted grant
expenses is not reimbursable through
the tuition rate for either current or prior
years, except for costs defined in A. above.
C. Effective July
1, 2005, Chapter 437 of the Laws of 2005
requires that the revenues and expenditures
awarded by local education agencies’ (LEAs)
pursuant to Section 611 (g)(1) and Section
619 (g)(1) of the Individuals with
Disabilities Act (IDEA) be reported in
separate and discrete cost columns.
Previously, these funds and related
expenditures were reported within the
program that benefited from LEA’s
suballocation. Program codes 9805 and 9806
are to be used to report the revenues and
expenses of §611 and §619 suballocations,
respectively. The full accrual basis of
accounting is required.
27.
Insurance
A. Reimbursable insurance
premium costs include those for liability,
fire/disaster, or casualty loss insurance
obtained to guard against loss to the
program. NOTE: Self-insurance plans for
liability, fire/disaster, or casualty loss,
whereby a program establishes a reserve or
contingency account/fund for future
liabilities are not reimbursable.
Self-insurance plans for unemployment and
workers compensation are allowable for
school districts if consistent with regular
district practice and in compliance with
this manual. (Please refer to
Item #9.B.on Interfund
Transfers).
B. Entities have an
obligation to adopt insurance practices that
will obtain the best coverage for the lowest
cost (i.e. solicit competitive bids on
insurance).
C. Costs of insurance on
the lives of owners/officers or employees
when the entity is identified as the
beneficiary are not reimbursable. Costs to
insure against the loss of key personnel are
not reimbursable. (Refer to Item
#14 on Compensation).
D. Costs resulting from
losses not covered because of deductible
insurance policy provisions, and in keeping
with sound business practice, are
reimbursable. Costs are not reimbursable if
the school chooses not to file a claim with
the insurance company for losses that are
covered under the policy in force at the
time.
Costs for Business Income
Insurance to safeguard against the loss of
revenues due to business interruption and
consistent with industry standards are
reimbursable and subject to the nondirect care
costs parameter.
28. Interest
Costs
A. Arm's-Length -
Interest expense on capital indebtedness and
working capital is reimbursable
provided the interest rate is not in excess
of the prime rate plus one percent of the
lending institution at the time the loan was
made. Interest expense will be reimbursed on
loans in excess of the prime rate plus one
percent only with written approval of the
Commissioner in cases where the entity can
establish that it was unable to secure a
rate of prime plus one percent or lower
despite its good faith efforts to do so.
Good faith efforts shall be demonstrated by
documentation that an entity has attempted
within the last year to obtain the most
competitive rate available from lending
institutions in the entity's immediate
geographic area. Loan procurement fees are
not reimbursable.
B. Less-Than-Arm's-Length
- Interest expense on capital indebtedness
or on working capital loans incurred in a
LTAL transaction between the lender and the
borrower will be reimbursed only with the
prior written approval of the Commissioner
upon establishment of the necessity and cost
effectiveness of the transaction. A cost
effective transaction relating to interest
expense on capital indebtedness or on
working capital loans is one in which the
interest rate charged by the LTAL lender is
less than or equal to the prime rate on
lending in the geographic area and is
greater than the actual cost of the capital
rate to the lender. The borrowing LTAL
entity must demonstrate that this LTAL
transaction was necessary as a last resort
to acquiring monies and that the interest
rate charged by the lending LTAL entity was
more favorable than could be obtained in the
market place and that rate of interest must
be demonstrated to be at prime or less of
the lending institutions in the geographic
region at the time the loan was incurred.
Loan procurement fees are not reimbursable.
(Refer to Section II C, Definitions,
Item #4 in this Manual for
LTAL).
C. Reimbursement of
interest expense on capital indebtedness
shall be subject to the following
conditions:
(1) Interest
expense shall be included in the
nondirect care cost parameter of the
rate-setting methodology.
(2) Interest
expense on bank loans, bonds,
mortgages or similar instruments
is reimbursable if such expense
was incurred to finance the
acquisition of fixed assets or
vehicles, or implement major
renovations necessary to provide
special education services that
conform to standards in Federal and
State law and regulation. Interest
costs on construction loans must be
capitalized as required by GAAP.
(3) Mortgage
interest expense will be reimbursed,
as part of occupancy costs effective
with the actual date of occupancy in
the new location. Occupancy refers
to the site where the students are
physically located and receiving
services as prescribed on their
IEPs. Occupancy costs of the prior
location are reimbursable up to the
actual date of occupancy in the new
location.
(4) Interest
expense on the above is
reimbursable only when there is
a corresponding amortization of
principal on the capital
indebtedness and there are no
loans/notes receivables from related
parties at any time during the
entity's loan repayment period.
Payments, which represent "interest
only", are not reimbursable.
D. Working capital
interest is defined as interest paid on
loans that are secured for operational
expenses. Entities are encouraged to explore
the most cost efficient means of working
capital borrowing. For example, a revolving
line of credit may result in a lower average
monthly principal and lower annual interest
charges. Reimbursement for interest expense
on working capital financing shall be
subject to the following conditions:
(1) Interest
expense shall be included in the
nondirect care cost parameter of the
rate-setting methodology.
(2) Interest
expense will be reimbursed only if
conditions exist that warrant the
principal amount of the loan.
Documentation that the loan is
warranted includes but is not
limited to:
.
Evidence that the required
financial statements and
financial reports were
submitted by the deadline
including any extension
approved by the Commissioner
and in the format required
by the Commissioner.
. For a
new program whose
prospective rate was to be
based on a budget, evidence
that the complete budget
with any applicable
supporting data was received
by SED fiscal staff within
30 days after a written
request.
. Documentation of cash flow
needs including receipts
and disbursements.
. Documentation indicating
that tuition billings
or their equivalent were
submitted to the appropriate
funding sources in a timely
manner in accordance with
a written contract or
schedule of payments and
at least one follow-up
notice was sent to delinquent
sources.
.
Documentation indicating
that the required preschool
program's contract with
the county was submitted
to the county on a timely
basis and in the format
required by the county.
(3) Interest
expense on working capital loans for
late filers of required financial
information will be reimbursed on a
prorated basis if submitted within
90 days of the respective due date.
No interest expense will be
reimbursed for entities that file
cost reports more than 90 days after
the respective due dates.
Non-reimbursable interest expense
will affect the tuition rates for
the tuition rate year, in accordance
with the rate-setting methodology,
and will apply to all tuition rates
for that year (prospective, appeal,
reconciliation adjustments/rates and
final audit).
(4) Interest
expense on working capital loans
used for the purpose of repayment of
tuition to school districts and/or
municipalities as a result of an
audit or reconciliation rate is
not reimbursable.
(5) Interest
expense is reimbursable only
when there are corresponding
payments of principal on the working
capital loans and only if
there are no loans/notes receivables
from related parties at any time
during the entity's loan repayment
period. Payments, which represent
"interest only", are not
reimbursable.
(6) Interest
expenses paid on loans to the entity
are not reimbursable unless the
criteria in Item #28 have been met.
In addition, these interest payments
will be considered compensation when
paid to a shareholder who is also a
paid employee or a consultant of an
entity or program.
29.
Investment Management
Costs of investment counsel and
staff and similar expenses incurred solely to
enhance income from investments are not
reimbursable.
30. Meetings
and Conferences
For reimbursement purposes,
conferences are generally defined to include
meetings, conventions, symposiums, seminars,
Department sponsored sessions or other such
assemblies whose primary purpose is the
dissemination of technical information. Conferences
must be directly related to the education program or
to the administration of the program. Programs shall
be required upon audit to provide brochures, agenda
or other literature that verify attendance and
document the purpose of the conference or meeting.
The following reimbursement principles shall be
applied to conference costs:
(1) Reimbursement for
off-site conference costs are limited to no
more than three conferences within a 12
month period for any single individual and
will be reimbursed consistent with New York
State guidelines for costs of meals,
transportation, rental of facilities, and
other items incidental to such conferences.
Reimbursement for transportation costs
will be limited to the most cost effective
means of travel. (Refer to
Item #57 on Travel.)
(2) Costs of conferences
held at out-of-state resorts are limited to
the guidelines detailed in
Appendix C.
Reimbursement is allowed up to three days
per conference for each person but only when
each person requesting reimbursement attends
six or more hours per day of conference
sessions.
(3) Costs for food,
beverages, entertainment and other related
costs for meetings, including Board
meetings, are not reimbursable.
(4) Costs of conferences
attended by teachers and other direct care
staff whose purpose is to improve desired
student learning outcomes by more effective
means are reimbursable.
(5) Costs of conferences
attended by administration staff are limited
to two people per conference and are
reimbursable provided that the purpose of
the conference is to improve or demonstrate
new administrative techniques or concepts
and the criteria in 1 - 3 above are met.
Such costs will be subject to the nondirect
care cost parameter.
(6) Documentation to
support the cost of meetings and conferences
must include the names and job titles of
staff that attended and the program(s)
served by each staff person.
31.
Miscellaneous Expenses
Expenses that do not fit into any
other category for the operation of Article 81 and
Article 89 education programs are reimbursable
provided these expenses meet the cost principle
criteria as discussed in this Manual. Miscellaneous
expenses are subject to the nondirect care cost
parameter.
32. Office
Supplies
See Section I Item#52
Supplies and Materials (Household).
33. Payroll
Preparation
The cost of preparing payrolls
and maintaining necessary related wage records is
reimbursable subject to the nondirect care cost
parameter.
34. Plant
Security
Necessary expenses incurred to
comply with security requirements, including wages
and equipment of personnel engaged in plant
protection, are reimbursable subject to the
nondirect care cost parameter.
35. Postage
Postage costs such as stamps,
postage meter rentals, and mailing permits for
Article 81 and Article 89 programs and activities
are reimbursable subject to the nondirect care cost
parameter.
36. Printing
and Reproduction
A. Cost for printing and
reproduction of forms or reports, etc.,
which are necessary for Article 81 and
Article 89 programs, are reimbursable.
B. Costs of providi |
