The Division of Local Government will close out the Federal award when it determines that all applicable administrative actions and all required work of the Federal award have been completed by the non-Federal entity. If the non-Federal entity fails to complete the requirements, the Federal awarding agency or pass-through entity will proceed to close out the Federal award with the information available.
Unless the Federal awarding agency or pass-through entity authorizes an extension, a non-Federal entity must conclude all financial obligations incurred under the Federal award no later than December 31, 2026, which is the end of the period of performance.
The non-Federal entity must promptly refund any balances of unobligated cash that the Federal awarding agency or pass-through entity paid in advance or that are not authorized to be retained by the non-Federal entity for use in other projects. See OMB Circular A–129 and see § 200.346, for requirements regarding unreturned amounts that become delinquent debts.
- Program staff will ensure that all financial obligations incurred under the SLFRF award are expended no later than the period of performance.
- Program staff will ensure that SLFRF award recipients promptly refund any unspent funds not authorized to be retained by the award recipient, including funds used for unallowable costs.
- Program staff will promptly complete all closeout actions once an SLFRF award recipient or subrecipient completes all closeout requirements.
Monitoring
The U. S. Department of the Treasury requires that SLFRF recipients that are pass-through entities as described under 2 CFR 200.1 are required to manage and monitor their subrecipients to ensure compliance with requirements of the SLFRF award pursuant to 2 CFR 200.332 regarding requirements for passthrough entities.
Monitoring is designed to assist the entity being monitored by ensuring that projects are operated efficiently and in a timely manner and that the project is being conducted in compliance with applicable Federal and State laws and requirements. This document covers subrecipient monitoring requirements and will be used for monitoring to assist DLG and its subrecipients to prepare for an audit in the event the project or projects, beneficiary or recipient (all subawards), or local government entity is audited by either internal auditors, State of Colorado auditors, or the Department of the Treasury (Treasury) Office of Inspector General (OIG). The OIG is responsible for monitoring and oversight of the receipt, disbursement, and use of ARPA payments.
SLFRF funding follows the same laws, regulations, and policies as the regular Federally Funded Grants. There are, however, some very distinct differences that must be acknowledged to ensure appropriate monitoring of SLFRF funds. The following items are unique and specific to SLFRF funds and are covered more in-depth within this document:
- Direct and indirect impacts of COVID-19 can be funded
- Duplication of Benefits are not allowed
- Waivers, which allow for project flexibility
The primary objectives of the overall monitoring processes are to:
- Gauge the overall project progress in meeting the objectives, goals, and deliverables articulated in the executed agreements;
- Serve as a management tool to identify issues that may compromise project integrity, funding, and service delivery for corrective action and resolution;
- Substantiate compliance with applicable federal statutes, regulations, waivers, policies, etc.;
- Substantiate compliance with SLFRF, Project policies, applicable state laws, etc.;
- Substantiate Subrecipient is carrying out the project or projects in a timely manner in accordance with the schedule included in the grant agreements;
- Substantiate Subrecipient is conducting the project in a manner which minimizes the opportunity for fraud, waste, and mismanagement; and
- Substantiate Subrecipient has a continuing capacity to carry out the approved project or projects in a timely manner.
- Ensure that a subrecipient administering a program on behalf of DOLA has procedures in place for obtaining contractor eligibility.
There are two primary types of Monitoring, “Virtual Monitoring” and “On-site Monitoring”. Ongoing remote evaluation is the primary method of tracking Subrecipient or beneficiary performance/compliance on a daily basis, determining the need for technical assistance, obtaining data to plan for the routine site visits, and determining the need for exception site visits. To the extent possible, this evaluation utilizes existing data that is routinely submitted for other purposes. Much of the data is captured in the DLG grants portal, the division’s grants management tracking system.
On-site monitoring may include the following items depending on the monitoring identified as necessary:
- Collecting information
- Selecting files for review
- Conducting file reviews
- Reviewing documents
- Observing actual project activities
- Conducting interviews to clarify and determine accuracy of information
- Identifying aspects of the project where the grantee is performing well or poorly
- Assessing compliance with project and regulatory requirements
- Determining whether record keeping is adequate
- Additional actions or reviews may also be determined necessary while on-site
The monitoring checklist (Appendix F) is the primary tool to be used by the program staff to monitor subrecipients prior to the final report and closeout of a project. If deficiencies are found, the monitored entity must submit a corrective action plan. In the corrective action plan, the monitored entity must describe the corrective action taken or planned in response to the findings and/or concerns identified by the program staff, as well as provide a firm timeline for when corrections will be completed or implemented and then provide evidence of the corrections.
DLG may choose to postpone the monitoring letter in favor of detailed technical assistance to the monitored entity if the monitored entity has unique issues that require substantial changes to the grant. The extra time for finalizing the monitoring letter MUST be documented with an interim letter to the DLG/Subrecipient or by a phone call/conference call with an explanation for the reasons for a postponed response. This action should be documented by in-house documents showing activity, ongoing research, and issue discussions.
Record Retention
According to US Treasury Terms and Conditions, section 4.c. SLFRF records must be maintained for a period of 5 years after all funds have been expended or returned to the Treasury.
For a subaward, the record retention period begins at the date of submission and approval of the final expenditure report by the subrecipient to pass-through entity. For federal awards or subawards that are renewed quarterly or annually, the record retention period begins on the date of the final submission and approval of the quarterly or annual financial report. The Office of State Controller Reporting has developed a guide on record retention.
Program staff will ensure that recipients and subrecipients are informed of their responsibilities regarding record retention related to the SLFRF award.
Disposition of Equipment and Real Property
SLFRF funds may be used to acquire real and personal property, supplies and equipment. During the period of performance, a recipient may use property, supplies, or equipment purchased or improved with SLFRF funds for a purpose other than the purpose for which it was purchased or improved if such other purpose is also consistent with the eligible use requirements. If a recipient changes the use of an asset to an ineligible use or sells the asset prior to the end of the period of performance, then the recipient must follow the disposition procedures in the Uniform Guidance. See 2 CFR 200.310, 200.311, 200.313, 200.314, 200.315 and 200.316.
After the period of performance, the property, supplies, and equipment must be used consistent with the purpose for which it was purchased or improved or for other eligible uses in the same category as the purpose reported to Treasury as of the final reporting period. More detailed guidance is provided in Appendix G - Disposition of Real Property, Equipment, and Supplies.
- Program staff will ensure during their monitoring activities that recipients and subrecipients are aware of the regulations regarding the use and disposition of real property, equipment and supplies.