5101:9-7-03 Public assistance (PA) financing and cash management.

The following accounting procedures are necessary for state and local accountability in the allocation of federal and state funds.

(A) Financing

The total payments to the public assistance (PA) fund are disbursed weekly to the county department of job and family services (CDJFS), upon receipt of the CDJFS draw request for funds. Available funds are limited by state appropriations and federal grant awards. All payments are issued via electronic funds transfer (EFT) .

(B) Cash management

When a CDJFS is funded on a reimbursement basis, program costs are paid by local funds before reimbursement is requested. When funds are drawn in advance, the CDJFS shall follow procedures to minimize the time elapsing between the transfer of funds from the state and local disbursement. Disbursements to a CDJFS administering federal programs shall cover allowable expenditures consistent with federal and state regulations.

(1) Requests for cash draws may be submitted weekly and processed by the Ohio department of job and family services (ODJFS) in six working days. In accordance with the cash management improvement act and 45 C.F.R. parts 74 and 92 and transmittal number TANF-ACF-PI-01-02 issued by the United States department of health and human services (DHHS), cash drawn in advance must be limited to the minimum amount needed for actual, immediate requirements. The CDJFS shall have cash management procedures in place to ensure the time elapsing between the receipt of funds and the disbursement of funds does not exceed a ten day average for all federal and state operating allocations.

(2) Cash drawn shall be traceable to a level of program expenditures adequate to establish that such funds have not been used in violation of the restrictions and prohibitions of applicable statutes, administrative rules and federal regulations. The accounting systems of the CDJFS shall support internal controls necessary to insure federal grants and state funds remain separated on a grant, program, or project basis.

(C) Quarterly cash on hand calculation

(1) At the end of each quarter, the ODJFS will calculate each CDJFS's average days' cash on hand. ODJFS will compute the expenditures on the quarterly state expenditure reconciliation for the PA data subset and the cash draw information on the county detail for all federal funding, on an individual grant basis, as expenditures and draw amounts appear on the county finance information system (CFIS) over/under report.

(2) The average days' cash on hand shall be calculated for each of the allocations as follows:

(a) At the end of each quarter, the ODJFS will calculate excess cash on hand by deducting the expenditures over the lifetime of the funding source, up to the budgeted amount, as reported on the JFS 02827 " Public Assistance Quarterly Financial Statement" as described in rule 5101:9-7-29 of the Administrative Code, from the total amount of cash draws over the lifetime of the funding source;

(b) The ODJFS will then calculate the average expenditures by dividing the total expenditures by the number of calendar days the funding has been available; and

(c) The ODJFS will then calculate the average days' cash on hand by dividing the excess cash on hand from paragraph (C)(2)(a) of this rule by the average daily expenditures in paragraph (C)(2)(b) of this rule.

(3) The ODJFS will forward the results of the average days' cash on hand calculation to the CDJFS for review.

(a) If an event, beyond the reasonable control of the CDJFS, results in noncompliance with the cash management requirements, the CDJFS shall document the event and upon request of ODJFS, provide documentation to the ODJFS office of fiscal and monitoring services.

(b) If circumstances resulting in the noncompliance are caused by internal control deficiencies or operational processes, the CDJFS shall document the steps implemented to avoid a reoccurrence and, upon request of the ODJFS, provide the documentation to the ODJFS office of fiscal and monitoring services.

(c) The ODJFS may take additional action to ensure the cash management practices of the CDJFS are in compliance with paragraph (B)(1) of this rule.

(D) Quarterly interest calculation and reconciliation

An interest liability accrues if federal funds are received prior to the day the funds are paid. A CDJFS shall calculate and report earned interest quarterly as a receipt. Earned interest can only be used for the intended program and held in the local account. The ODJFS will complete the quarterly interest reconciliation using "State Treasury Reserve of Ohio" (STAR Ohio) rate and send a preliminary spreadsheet to the CDJFS.

(1) Interest on the cumulative amount of excess cash on hand shall be compounded daily and calculated by the CDJFS using either the average monthly interest rate earned or the STAR Ohio interest rate published on the Ohio treasurer of state website at http://www.ohiotreasurer.org.

(2) As part of the quarterly interest reconciliation the CDJFS may take into consideration the months in which the CDJFS used local funds for program purposes other than for local match and therefore operated on a reimbursement basis, providing the CDJFS requests funds timely as set forth in this rule. When the quarterly interest liability as calculated in paragraph (D)(2)(a) of this rule is a negative number and when the CDJFS has documentation identifying the funds used as local funds, the resulting negative number may be used to offset any interest liability from other months during the quarter. The format of the quarterly reconciliation will include, at a minimum, the following:

(a) The monthly interest liability owed by the CDJFS or the monthly offsetting interest liability based upon the CDJFS using local funds for program purposes for each applicable federal program allocation; and

(b) The total net interest liability owed by the CDJFS or the total net offsetting interest liability based upon the CDJFS using local funds for program purposes for each applicable federal program allocation for the quarter.

(c) The total net interest liability owed by the CDJFS or the total net offsetting interest liability based upon the CDJFS using local funds for program purposes for each applicable federal program allocation for the federal fiscal year. In accordance with 45 C.F.R. 92.21(i) , a CDJFS, as subgrantee, may keep interest amounts up to one hundred dollars per year for administrative expenses.

(3) For each applicable federal program allocation with a total net interest liability (a positive number calculated in the quarterly reconciliation), the CDJFS shall report the net interest liability as a reduction to expenditures on the subsequent quarterly expenditure report.

(4) For each applicable federal program allocation with a negative total net offsetting interest liability (a negative number calculated in the quarterly reconciliation), no adjustment to income will be necessary. The ODJFS will not be liable to the CDJFS for any interest liability based upon the CDJFS using local funds for program purposes.

(5) The CDJFS shall maintain the completed quarterly interest reconciliation documentation in accordance with the records retention requirements outlined in rule 5101:9-9-21 of the Administrative Code. This documentation may be subject to inspection, monitoring, and audit by the ODJFS and the Ohio auditor of state(AOS).

Effective: 12/18/2011
Promulgated Under: 111.15
Statutory Authority: 5101.02
Rule Amplifies: 5101.02
Prior Effective Dates: 8/24/07, 9/12/09, 11/5/10