1. Fiscal Definitions

Grantees must use grant funds in accordance with signed assurances and the approved grant proposal. Expenses must be in compliance with federal and state requirements and be reasonable, necessary, allowable and allocable. Funds are subject to the Supplement not Supplant provision.

Administrative Costs (AELA)

Administrative costs may not exceed 10% of the total award.

Administrative costs are costs that do not directly involve a learner, but instead support the program delivery and development activities. It includes but is not limited to planning; administration (including performance accountability); professional development; and promoting co-enrollment.

Allowable Cost

Necessary - The cost is required for the proper and efficient performance and administration of the grant. Program goals and objectives outlined in the grant proposal can be a helpful lens for determining if the cost is necessary for either programming or management required to implement the approved grant.
Reasonable - The cost is an amount that a reasonable person would expend for the same product or service. Another way to determine reasonable cost is to assess the market value of comparable goods or general recognition that the cost is ordinary and necessary for the performance of the grant.
Allocable - The cost is allocable in relation to the benefit that particular grantee receives. If a grant charges 100%of a cost to the grant then the entire benefit (100%) from the expenditure must serve the purpose of the grant.
Allowable (AEFLA) - The cost is permitted under AEFLA as well as EDGAR and 2 CFR Part 200.
Allowable (AELA) - The cost is permitted under AELA (PDF) and State Board of Education Rules, or 2 CFR Part 200, whichever is more restrictive.
Supplemental cost, that does not supplant - The cost of the activity, product or service would not be delivered in the absence of this funding, and does not REPLACE currently utilized for the same activity. In addition, if the cost objective is something that the subgrantee would provide in the normal course of their business regardless of funding, those costs would be considered supplanted costs.

Allowable Expenses (AEFLA)

This information is provided to assist grantees in determining the allowability of costs under the federal AEFLA Grant. This guidance is for expenditures paid with the Federal funds and match expenditures.

All costs must:

Be necessary and reasonable, and allocable,
Conform to any limitations or exclusions set forth in the cost principles or the award,
If grantees are applying policies and procedures across the organization, this must also include all activities within the AEFLA grant program.
Be accorded consistent treatment,
Be determined in accordance with Generally Accepted Accounting Principles (GAAP),
Ensure amount charged for a purchase paid from the AEFLA grant includes credits, and
Be adequately documented and reported.

No cost related to an AEFLA cost objective may be related to/expensed to any other federally funded award.

Additional guidance can be found in the federal Uniform Grant Guidance.

The list below shows allowable and unallowable costs for AEFLA funds. Note this list is not comprehensive, nor all-inclusive. Expenditures must follow the Uniform Grant Guidance, EDGAR, Cost Principles, GAAP, GEPA, and be permitted by the WIOA Title II and WIOA Title II rule and Joint Rule.

Allowed

Advertising Costs
- The costs associated with communicating grantee offerings is allowed. The grant will cover the cost of flyers, brochures that are created to promote AEFLA program activities. These costs must be reasonable.
Childcare
Educational expenses associated with the delivery of literacy, numeracy, and life skills instruction
Equipment
- Teacher - The grant will cover the cost of a computer for teachers paid with the grant funds. The cost must be allocable and proportionately paid for with AEFLA funds. Example: If a teacher will be hired .50 FTE for grant activities and .50 FTE will be spent addressing other awardee needs, only half of the computer would be allocable to the grant and the balance would need to be paid from other funding sources.
Fingerprinting
- ABEA application fee and fingerprinting.
Indirect Costs
- Indirect cost are allowable if:
  - The documentation from the agency’s cognizant Federal Office approving a restricted indirect cost rate is submitted to Grants Fiscal Management.
  - The de minimis rate can be utilized by a non-profit upon review and approval of the Modified Total Direct Cost (MTDC) documentation submitted to Grants Fiscal Management. §200.414 (f)
  - The agency can elect to charge a maximum of 10% administrative costs in lieu of indirect costs upon approval by CDE.
  - Indirect costs may not be counted as match.
Personnel Cost-Salaries and Benefits
- All personnel costs must be for services provided to eligible individuals as defined by WIOA. No exceptions. Navigator positions are allowable position costs.
- Benefits includes social security, employee life, health, unemployment, and worker’s compensation insurance (except as noted in 2 CFR §§200.447 Insurance and indemnification); pension costs and other similar benefits are allowable, provided such benefits are granted under established, written program policies.
- Administrative personnel costs including benefits are allowed within the approved administrative cost percentage the grantee received from CDE.
Professional Development for staff paid with grant funds
- Professional development is available for staff whose salary and benefits are paid directly by the AEFLA Grant. Professional development must align with the approved project goals outlined in the approved application.
  - In State
  - Out of State requires prior approval by CDE
Professional Development-Out of State
- Prior approval from AEI is required. Grantees complete a justification for any out-of-state travel when submitting initial and revised budgets. Instructions are located in the budget template. The rationale indicated in the budget justification will demonstrate the need to travel out of state, that similar professional development is not offered in the state, and that only a minimal number of staff (one or two) will attend (as an example). Of course all travel should align with cost objectives within the final, approved budget.
Practice Testing Fees
- The cost of high school equivalency practice test fees will be covered if they are reasonable and are supported by the number of students receiving services from the grantee.
Transportation
- Transportation costs associated with student engagement in the program are allowed. Grantees must ensure appropriate documentation is maintained for these costs. Grantee must provide anticipated number of students to be served and an estimated cost per student.
Costs associated with Integrated Education and Training. Grantees should first attempt to coordinate with postsecondary education providers or employer/other training providers for the workforce training component prior to using AEFLA funds.

Not Allowed

Contingencies - This includes a budget line that states-funds will be held for professional development however the needs are not known at this time.
Fundraising
Entertainment Costs
Gift cards
Food costs, including snacks
Incentives to staff/participants/volunteers, including luncheons
Fines, Penalties
Legal Expenses
Political activities
Lobbying costs
Grant writing
Vacation time - This cost should be accrued by the awardee and not charged to the AEFLA Grant.
High School Equivalency assessments
Course costs related to obtaining the ABEA
Tuition and fees that create barriers.
Promotional materials such as pens, hats, shirts and water bottles.

Allowable Expenses (AELA)

This information is provided to assist grantees in determining the allowability of costs under the state AELA Grant.

All costs must:

Be necessary and reasonable, allocable and allowable;
Focus on programs that prepare individuals for training leading to occupations that have the potential to pay a self-sufficient wage.
Conform to any limitations or exclusions set forth in the award;
If grantees are applying policies and procedures across the organization, this must also include all activities within the AELA grant program.
Be accorded consistent treatment,
Be determined in accordance with Generally Accepted Accounting Principles (GAAP),
Not included in another grant,
Ensure amount charged for a purchase paid from the AFLA grant includes credits, and
Be adequately documented and reported.

No cost related to an AELA cost objective may be related to/expensed to any other federally funded award.

The list below shows allowable and unallowable costs for AELA funds. Note this list is not comprehensive or all-inclusive. Always review 2 CFR Part 200.

Allowed

Advertising Costs
- The advertising costs associated with student recruitment is allowed. The grant will cover the cost of flyers, brochures that are created to solely promote AELA program activities. These costs must be reasonable.
Child care
- Child care costs are allowable as it relates to providing childcare for children of parents participating in AELA programming.
Commencement expenses
- Limited to cap and gown and limited food; does not include the cost of decorations, invitations, and awards.
Curriculum development
- Curriculum development for courses that assist adults in obtaining basic skills in workforce development or postsecondary transition and integrated education and training.
Educational expenses associated with the delivery of literacy, numeracy, and life skills instruction
Employment placement costs
Equipment
- Teacher - The grant will cover the cost of a computer for teachers paid with the grant funds. The cost must be allocable and proportionately paid for with AELA funds. Example: If a teacher will be hired .50 FTE for grant activities and .50 FTE will be spent addressing other awardee needs, only half of the computer would be allocable to the grant and the balance would need to be paid from other funding sources.
- Student - Due to limited funding, grantees must provide support for the use of grant funds to purchase laptops. The allocability of the cost to the grant will need to be reviewed to ensure the grant is not paying 100% for equipment that will be used by other programs within the awardee's entity. Pre-approval is required by CDE.
Food Costs
- The grant will cover the cost of food costs for parent and student activities/meeting. This must relate to the grant with a copy of the agenda included as supporting documentation.
Partnership development
- Including one-time infrastructure expenses, print materials, outreach activities, and travel.
Professional Development for staff paid with grant funds
- Professional development is available for staff whose salary and benefits are paid directly by the AELA Grant. Professional development must align with the approved project goals outlined in the approved application.
Professional Development-out-of-state
- Prior approval from AEI is required. Grantees must complete a justification for any out-of-state travel when submitting initial and revised budgets. Instructions are located in the budget template. The rationale will demonstrate the need to travel out of state i.e., that similar professional development is not offered in the state, and that only a minimal number of staff (one or two) will attend (for example).
Professional development for all staff of an awardee
- Professional development that a grantee would like to offer to their entire staff must be pre-approved. This professional development request must include the need to provide this training to all staff. Please include in the explanation if other funds would be available to support this training.
Professional Development to partners
- The AELA Grant does require that recipients of the grant provide professional development to its partners.
Testing Fees
- The cost of enrollment/testing fees will be covered if they are reasonable and are supported by the number of students receiving services from the grantee. This includes: ConOver/Workforce, Prove It, GED, HiSET, and TASC.
Transportation
- Transportation costs associated with student engagement in the program are allowed. Grantees must ensure appropriate documentation is maintained for these costs. Grantee must provide anticipated number of students to be served and an estimated cost per student.
Work-experience costs
- This includes uniform costs, instructional materials, and assessment costs.

Not Allowed

Indirect costs
- Indirect cost is not allowed under this grant. All costs must be direct costs that are well-documented.
Staff certification and continuing education
- Certification that is part of training is not an allowable cost. The grant also doesn’t allow for the cost of continuing education requirements.
Lobbying costs

Carry Over

Grant funds cannot be carried over from one fiscal year to the next. Funds must be spent during the fiscal year (July 1-June 30). If grantees do not obligate funds by June 30, grantees will need to revert funds back to CDE.

AEFLA

The grantee will have until September 15th after the fiscal year ends to request for final reimbursement of the previous fiscal year’s funds. Funds not requested after that time will revert back to CDE. Grants fiscal may request at any time, a system generated financial report (general ledger) represented all expenses for the performance period supporting all reimbursements. Typically, this will be required to be included with the final performance period AFR.

AELA

Any unobligated funds must be reported on the Annual Financial Report submitted September 30th of each year.

Fund Types (AEFLA)

WIOA Title II AEFLA funds (ie: federal funds) and match funds are used to fund the AEFLA program. Information about each type of funding is provided below.

Federal Funds

Federal funds are the funds a sub-grantee receives under Title II of WIOA.

Grantees are required to spend their AEFLA and IELCE grant funds on costs that follow 2 CFR Part 200, EDGAR and C.F.R Part 34, as applicable, and are part of their approved budget. All costs must be reasonable, necessary, allowable, allocable and documented.

Under Sec. 233 of WIOA there is a 5% maximum administrative cap for the funds awarded under AEFLA and IEL/CE. Grantees may request approval from AEI to utilize up to 10% of federal funds on administrative costs. If a grantee is aware they will exceed the 5%, they must receive prior written approval.
- Note: A grantee may charge indirect costs to the AEFLA Grant; however, the grantee may not request more than 10% of their federal allocation for indirect costs and administrative costs combined. This is true even if the local program has an approved indirect cost rate with another state agency. Per federal law, those indirect cost plans cannot apply to AEFLA funds.

Match requirement

All grantees must secure non-federal match funds that are no less than 40% of the federal funds received.
Match funds and third party in-kind contributions may not count if they are satisfying a cost sharing or matching requirement of another agreement, a Federal procurement control or any other Federal funds.
Match funds are not required to follow the maximum administrative cost limitations set forth in WIOA.
Funds identified as match can be used based on the need of the grantee, as long as they are reasonable, necessary, allowable under WIOA, allocable and documented.
Documentation for all match must be maintained at the same level as the federal funds expended.

Serving Corrections Individuals (AEFLA)

Statewide, no more than 20% of funds available for distribution may be used for corrections education. There is not a cap at the grantee level. Corrections education is defined as criminal offenders (ie: individuals charged with or convicted of a criminal offense) who reside in correctional institutions (WIOA Title II, Section 225).

Supplement vs Supplant

AEFLA

Grantees may not supplant (substitute/divert) funds using AEFLA funds. Supplement, not supplant is an integral provision of most federal statutes that authorize grant programs. This requires that grantees use state or local funds for all services required by state law, State Board of Education rule, or local policy and prohibit those funds from being diverted for other purposes when federal funds are available. Federal funds must supplement (Ie: add to enhance, expand, increase or extend) the programs and services offered with state and local funds. If services would be provided in the absence of this grant, by using federal grant funds to cover any portion of these services, it would be considered supplanting.

AELA

All expenditures must supplement not supplant any federal, state or local money currently being used to provide adult education and literacy services. Funds must supplement (i.e.: add to enhance, expand, increase or extend) the programs and services offered with state and local funds. If services would be provided in the absence of this grant, by using federal grant funds to cover any portion of these services, it would be considered supplanting.