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Health and Human Services Agency (HHSA), recommending the Board approve and authorize the Chair to sign a nonfinancial Indirect Cost Negotiation Agreement with the U.S. Department of Housing and Urban Development, Office of Community Planning and Development, to establish an Indirect Cost Rate of 30.65% for the period from July 1, 2016 through June 30, 2017, for federally-funded HHSA programs.
FUNDING: N/A
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DEPARTMENT RECOMMENDATION:
Health and Human Services Agency (HHSA) recommending the Board approve and authorize the Chair to sign the attached Indirect Cost Negotiation Agreement with U.S. Department of Housing and Urban Development (HUD) to establish a “Fixed with Carry-Forward” Indirect Cost Rate (ICR) of 30.65%, effective beginning July 1, 2016 through June 30, 2017.
This is not a retroactive service agreement, rather it is an agreement establishing the indirect cost rate for a specified period (July 1, 2016 through June 30, 2017) to be used in the reporting and reimbursement of federally funded programs. It is standard practice for the ICR to be established based on historical and current year data.
DISCUSSION / BACKGROUND:
HHSA has indirect costs that are charged to federal agencies. General management activities support programs through processing of purchases, contracts, payroll, payment of invoices, etc., and such costs are necessary for each program to exist. Establishing this ICR will create a standardized, efficient way to recover a share of general management costs from individual federally-funded programs when appropriate. Without an ICR, cost recovery for support activities are limited to the allowance per funding agreement, frequently limited to ten percent (10%), thereby creating a gap in funding for support activities that must be covered by alternate funding such as realignment, or even general fund.
The Office of Management and Budget (OMB) Guidance, 2 Code of Federal Regulations (CFR) 200, explicitly requires st...
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