Prepare Now to Avoid Audit Risk in State and Local Fiscal Recovery Funds Compliance and Reporting
The $350 billion Coronavirus State and Local Fiscal Recovery Funds (SLFRF), administered to state and local governments through the American Rescue Plan, allows recipients flexibility in addressing pandemic harm. Those receiving SLFRF can design programs that meet unique and specific needs of their constituents to address communities and industries adversely impacted by job losses, declines in revenue, and increased demand for services and changes in educational services. However, with acceptance of an SLFRF award comes the responsibility of reporting to the U.S. Department of the Treasury (Treasury). The July 30, 2022 reporting deadline for both the Quarterly Project and Expenditure (QPER) and the Annual Recovery Plan Performance Report (ARPPR) is quickly approaching. While the necessary compliance and reporting can be a complicated task, partnering with a team of experts like the consultants at Bronner can help your organization at this crucial point and minimize risk of future audit findings on SLFRF programs.
Quarterly Project & Expenditure Report
The Quarterly Project & Expenditure Report (QPER) that covers projects and expenditures from April 1 – June 30, 2022 will be due July 30, 2022. Those who have previously participated in the quarterly reporting process may be surprised at the additional, detailed requirements of the upcoming QPER now that many SLFRF programs are underway and incurring obligations and expenditures. The comprehensive information required for sub-recipients, contract amounts, program completion status, and beneficiary demographics will make this QPER particularly complex and the most difficult Treasury report to prepare for any stream of federal funding since the pandemic relief funds began flowing.
Since the Treasury’s online portal is only open for reporting 30 days prior to the QPER due date, timing is of the essence. Some items, such as the project summary and budget, will be stable across quarters, and recipients will be able to copy the information directly from original project proposals. Others, such as project demographic distribution and project expenditures, are variable in nature and require careful tracking and reporting. Demographic data on beneficiaries may need to be validated and tracked back to the intended beneficiaries described in the program’s design. Incorporating data collection into program administration and using a required documentation checklist will streamline the data collection process and minimize the risk of gaps in reporting. Recipients should obtain the required outcome data for the QPER, at a minimum, 15 days after quarter end to allow sufficient time for analysis, reconciliation of data anomalies, and organization of data into reports or transferring to bulk upload template.
Annual Recovery Plan Performance Report
On July 30, 2022, SLFRF recipients will also need to complete an Annual Recovery Plan Performance Report (ARPPR). In addition to annualized data from the QPER, the ARPPR requires an executive summary and ‘use of funds narrative’ that details efforts to promote equitable outcomes, engage the community, and utilize evidence in program design. This narrative informs Treasury on how funds are being allocated and how recipients are ensuring that outcomes match goals. To provide a complete picture of program goals, in addition to the mandatory Treasury Key Performance Indicators, recipients are encouraged to identify additional key performance indicators (KPIs) specific to their jurisdiction. The information from this annual report is required to be posted on a public-facing website, giving recipients an opportunity to showcase the positive impacts these programs are making within communities.
Best Practices
Managing the data for the Quarterly Project & Expenditure Report across numerous programs, while simultaneously producing the an Annual Recovery Plan Performance Report, will be a complicated task. The following are six tips for successful reporting:
Ensure that all SLFRF funds are being spent according to Uniform Guidance, whether spent on general government, transferred to sub-recipients, or paid to a contractor.
Create sub-recipient and contractor profiles before adding expenditure or outcome data in the Treasury portal.
Ensure that the Expenditure Category originally selected for the SLFRF program did not change in the February 28, 2022 Compliance and Reporting Guidance.
Create a simplified check list or table for program managers and sub-recipients to provide their program data.
Ensure that data from financial systems is gathered as close to July 30th as possible.
Cross check procurement data, expenditure data, and program manager-reported data to ensure alignment.
As SLFRF programs are rolled out and begin to address the harms caused by the pandemic, it is important that these programs comply with Treasury rules. Good management and communication, as well as having experts like Bronner to advise along the way, can ensure recipients are prepared for federal grant compliance and reporting now and in the future.
Learn more about Grants Management and Compliance today!