179-2-07 Program costs.

(A) "Allowable costs" are the expenses for budgeted line items that have been approved by the commission. Allowable program costs must:

(1) Be necessary and reasonable for proper and efficient administration of the program, be allocable, and except as specifically provided, not be a general expense to carry out the overall operations of the grantee;

(2) Be authorized or not prohibited under state or local laws or regulations;

(3) Be consistent with other policies, regulations, and procedures that apply to other activities of the grantee; and

(4) Be accorded consistent treatment through application of generally accepted accounting principles appropriate to the circumstances.

(B) Personnel costs are allowable program expenses under commission grants. Program funds may be used to compensate employees for the time devoted specifically to execution of grant programs. "Employees" constitute those individuals who are entered into the applicant's employment system, are receiving fringe benefits provided to grantee applicant's employees and are subject to grantee applicant's employment rules and policies.

(C) Compensation for program employees shall include all remuneration paid currently or accrued for services, rendered during the period of performance under the grant agreement including wages, salaries, supplementary compensation and benefits. Compensation for program employees shall be considered reasonable to the extent that it is consistent with that paid for similar work in other activities of the grantee applicant. The commission reserves the right to disapprove the use of program funds for any employee benefit included in the budget request if, in the commission's opinion, the benefit is inconsistent with allowable cost requirements.

(D) Individuals providing services under personal service contracts that do not meet the conditions of paragraph (B) of this rule are considered as contract employees. All contracts and subcontracts entered into by the grantee with commission funds shall contain all of the following:

(1) Clear and unambiguous provisions sufficient to define a sound and complete agreement;

(2) Provisions or conditions for administrative, contractual or legal remedies if the contractor violates or breaches terms of the contract.

(3) Suitable provisions for termination of the contract by the grantee including but not limited to the manner of termination and the basis for settlement; and

(4) A description of conditions for termination for default and circumstances beyond the control of the contractor.

(E) Travel costs are allowable expenses and include transportation, lodging, subsistence and related items incurred by program employees under this rule. Contractual employees are eligible for travel reimbursement; however, the terms for reimbursement shall be included in the contractual agreement. Costs shall be budgeted and reported under contractual expenses.

(1) Costs may be charged on an actual basis, per diem or mileage basis in lieu of actual costs incurred, provided the method used results in charges consistent with those in effect with the department of administrative services, unless prior approval has been received from the commission.

(2) Travel costs are allowable for client transportation when necessary to meet objectives.

(F) Equipment purchases may be allowed if it is determined by the commission to be consistent with the goals and objectives for carrying out the performance of the program.

(G) A written budget revision request must be submitted to the commission to revise any part of an existing budget, including, but not limited to, modification of the grant award, modification of the total program budget, transfer of funds among budgeted line items or introduction of additional line items. A budget revision submitted for a modification in the grant award or total program budget must be approved or disapproved by the commission. Budget revisions for transfer of funds among budgeted line items or for additional line items to the budget may be approved or disapproved by the executive director. If approved, the revised budget request supersedes the existing budget.

(1) Program expenditures may not be approved when the budget revision request is submitted after the expenditure is made.

(2) Programs are limited to one budget revision a quarter unless acceptable justification can be provided.

(3) Grantees will be notified of budget revision approvals in a letter signed by the executive director.

(4) Grantees will be notified of budget revision disapprovals in a letter which states the reasons for disapproval and is signed by the executive director.

R.C. 119.032 review dates: 07/25/2008 and 12/30/2012

Promulgated Under: 119.03

Statutory Authority: 179.02, 179.03 ORC

Rule Amplifies: 179.02, 179.03 ORC

Prior Effective Dates: 5/16/90, 9 /20/90, 4/8/91