Response from the Secretary of Agriculture, November 29, 2001, Enclosure
The enclosed copy of the CCC Controller's instructions provides answers to questions 1A, 1B, and 2C in your letter. Enclosure 1 Special Instructions for CCC Grant Advances This provides States with specific instructions for handling the topics identified. If additional information is required, contact David Nichols at (703) 305-1300. 1. Handling Earned Interest on Grant Funds Advanced by CCC.
If the grant funds advanced by CCC were deposited in an interest bearing bank account, the cumulative earned interest for all three grants shall be processed according to the following instructions:
• If the cumulative amount of interest earned is less than $100 as of the end of any quarter, as defined in section 3, no action is required by the State. If the cumulative amount of interest earned does not exceed $100 during a year, the State may keep those funds for administrative costs.
• If the cumulative amount of interest earned is $100 or more by the end of any quarter, as defined in section 3, the State will transfer the interest earned to CCC. This requirement complies with the requirements referenced in the Agreement concerning regulations at 7 C.F.R. Part 3016.
• Earned interest payments due to CCC will be made by check payable to the "Commodity Credit Corporation" and mailed to the Office of the Controller, at the following address: Controller, Commodity Credit Corporation
1400 Independence Avenue, S.W., Stop 0581
Washington, D.C. 20250-0581
• If earned interest is being sent to CCC at the end of any quarter, be sure to include a reference to the amount sent in by completing Section B of the "Quarterly Grant Activity Report". (See Enclosure 2)
2. Reporting Expenditures of Grant Funds Advanced by CCC.
Since the authorizing legislation required that these Grant funds be obligated and expended by the Federal Government by September 30, 2001, CCC advanced the Grant funds to States during September 2001. The CCC recorded the Grants as an advance of funds. States are required to provide quarterly reports to CCC showing the amount of Grant funds expended during the quarter so that CCC can reduce the funds advanced and record Grant program expenses. The section provides (1) a definition of what an expenditure is for the State's reporting requirements and (2) instructions for reporting Grant fund expenditures accomplished.
Definition: Expenditures are payments made by the State from Grants funds where the funds are no longer under the control of the State and there is little likelihood that the State will receive the funds back. For example: direct payments to producers, advances of funds on signed contracts, and payments to vendors for services provided. Enclosure 1
Reporting Instructions: To help CCC and the State maintain records of the amount of funds being spent and how much is still available, States will:
• report the amount of funds expended for each of the three Grant programs using the format of the "Quarterly Grant Activity Report" provided in Enclosure 2. Note: Make copies of the "Quarterly Grant Activity Report" to use for subsequent reports.
• enter the amount expended within the quarter on the appropriate row and in the appropriate Grant Program column,
• subtract those expenditures from the original amount of the Grant and enter the remaining sum on the "Remaining Funds Available" row in the appropriate column.
• enter the name and phone number of the person preparing the form in the space provided on the "Quarterly Grant Activity Report".
• fax the "Quarterly Grant Activity Report" to CCC at (703) 305-1144 by the due dates shown in section 3.
• discontinue providing the "Quarterly Grant Activity Report" after reporting that all Grant funds have been expended and remaining funds available balances are zero.
3. Timing of Required Actions.
This section provides the timing and due dates for reports and funds transfers required by CCC.
• The "Quarterly Grant Activity Report" is due to CCC by the 15th calendar day of the month following the end of the quarter.
• Reportable quarters end on December 31, March 31, June 30 and September 30.
4. Extensions of Time Beyond One Year for Making Expenditures.
The Agreement provides that all State expenditures using these Grant funds will be completed within one year from the date the funds were made available. CCC is expecting that all funds will be expended by September 30, 2002. However, if a State expects to need additional time to complete the expenditure of these grant funds, the State must request an extension from the Controller. This request should include a purpose for the extension and the amount of time requested at a minimum. Requests for extensions should be sent in writing to the Controller, CCC, at the address shown in Section 1.