1. The American Recovery and Reinvestment Act of 2009 The Federal Stimulus Bill Overview of Federal and State Requirements Bud Fitch, Director, Office of Economic Stimulus New Hampshire School Administrators Association New Hampshire Association of School Business Officials Thursday, September 24, 2009

2. New Hampshire is committed to putting people to work with stimulus funds in a manner that is: Accountable Transparent Prudent

3. State Fiscal Stabilization Fund – Education Formula Funds Adequacy Payments Required by federal law LEAs may use the funds for any federally permitted expense State recommends use for payroll

4. Cash Management Improvement Act Applies to: State receipt – disbursement to LEAs LEA’s receipt – expenditure Solution that keeps us all in compliance: Reimbursement basis for disbursement

5. ARRA Education Funds Reporting - Section 14008 SEC. 14008. STATE REPORTS. For each year of the program under this title, a State receiving funds under this title shall submit a report to the Secretary, at such time and in such manner as the Secretary may require, that describes—

6. ARRA Education Funds Reporting - Section 14008 (1) the uses of funds provided under this title within the State; (2) how the State distributed the funds it received under this title; (3) the number of jobs that the Governor estimates were saved or created with funds the State received under this title;

7. ARRA Education Funds Reporting - Section 14008 4) tax increases that the Governor estimates were averted because of the availability of funds from this title; (5) the State’s progress in reducing inequities in the distribution of highly qualified teachers, in implementing a State longitudinal data system, and in developing and implementing valid and reliable assessments for limited English proficient students and children with disabilities;

8. ARRA Education Funds Reporting - Section 14008 (6) And (7) related to higher education (8) a description of each modernization, renovation and repair project funded, which shall include the amounts awarded and project costs.

9. The State will be contacting you soon to request copies of appropriate payroll records/system reports to document expenditure of funds on payroll for teachers/staff who are not funded in any part with federal funds.

10. The Office of Economic Stimulus, The State Department of Education, and New Hampshire’s Schools must work together to get ARRA right.

11. The taxpayers have entrusted us with hundreds of millions of tax dollars for education. The taxpayers deserve that we spend those dollars in an accountable, transparent, and prudent manner

12. How well we do will affect future funding: Immediate – Race to the Top Funds Future – New appropriations by Congress

13. Race to the Top Fund (Appropriation: $4,350,000,000) : Competitive grants to encourage and reward States that are creating the conditions for education innovation and reform; Implementing ambitious plans in the four education reform areas Achieving significant improvement in student outcomes Making substantial gains in student achievement Closing achievement gaps Improving high school graduation rates Ensuring that students are prepared for success in college and careers.

14. ARRA Assurances New Hampshire has committed to advancing education reform in four specific areas: 1. Achieving equity in teacher distribution; 2. Improving collection and use of data; 3. Enhancing the quality of standards and assessments; and 4. Supporting struggling schools.

15. Errors found during audits can lead to federal authorities demanding repayment of funds!

16. Top Ten Reasons your ARRA funded Program would be Audited

17. 10. Significant changes in federal programs, laws or regulations (changes in the compliance supplement for a particular program)

18. 9. Complex and/or new compliance requirements

19. 8. Lack of accounting controls for expenditures of federal funds.

20. 7. Programs administered under multiple internal control structures (Lots of folks involved in spending the $)

21. 6. Stand-alone computer systems versus centralized accounting. Also a newly installed system or recent modifications to a system may indicate high risk.

22. 5. Turnover in key personnel who administer the grants

23. 4. Competence and experience of personnel who administer the grants is weak

24. 3. Overall control environment at management level is found to be weak

25. 2. Prior audit experience – prior findings of internal control weaknesses or compliance issues were identified

26. 1. Federal audit reports issued with findings

27. Accounting Standards Greater Cost Accounting Detail More Reporting Detailed Labor Tracking Increased Oversight

28. Accounting Standards CFR § 76.730 Records related to grant funds. A State and a subgrantee shall keep records that fully show: (a) The amount of funds under the grant or subgrant; (b) How the State or subgrantee uses the funds; (c) The total cost of the project; (d) The share of that cost provided from other sources; and (e) Other records to facilitate an effective audit.

29. Accounting Standards CFR § 76.731 Records related to compliance. A State and a subgrantee shall keep records to show its compliance with program requirements.

30. Special Compliance Issues Davis-Bacon Prevailing Wage Must pay DOL wage rates Buy-American Act Must use iron, steel & manufactured goods of US origin

33. Accountable Municipal/School Level: – Grant and allocation agreements will require separate tracking and reporting of ARRA funds

34. Accountable Quarterly reports to federal authorities – Section 1512

35. Accountable There will be enhanced oversight: 184 Million to federal Inspector General’s Offices for programs funded in N.H. Office of Economic Stimulus will utilize compliance personnel to assist State agencies, Municipalities, Schools, and Non-Profits

36. Accountable Davis-Bacon Prevailing Wage documentation will be required where applicable

37. Accountable Buy America compliance documentation will be required where applicable

38. Prudent Avoid a Funding Cliff when ARRA appropriations are depleted

39. Prudent Use ARRA funds for infrastructure, goods, or services that bring lasting value to New Hampshire

40. Prudent Use ARRA funds for new personnel or new programs only if they can be: Discontinued when the ARRA funds are depleted; or Funded from a non-tax source after ARRA funds are exhausted

41. Office of Economic Stimulus State House Annex, Room 208 25 Capitol Street Concord, New Hampshire 03301 US Mail: 107 North Main Street, State House – Rm 208 Concord, New Hampshrie 03301 nhoes@nh.govnhoes@nh.gov http://www.nh.gov/recovery/ (603) 271-2121http://www.nh.gov/recovery/ Director: Bud Fitch (603) 271-8785 Bud.fitch@nh.gov