HHS has initiated an accelerated closeout process for grant awards under its administration. HHS may close out grants at anytime following the end of the grant’s liquidation period and is currently closing out grants on the Federal Payment Management System with project end dates of September 30, 2006 and earlier. As they continue to work on closing these grants, they may also move on to grants with a project end date of September 30, 2007. This accelerated closeout process may result in HHS requesting the return of Federal reimbursements for disbursements made after the liquidation date.
It is critical that state agencies are timely in spending and redistributing funds from grant awards and diligent in following Federal grant regulations regarding those disbursements and the reporting of them. HHS has the authority to close awards at any point following the end of the grant’s liquidation period and have simply intensified enforcement of this authority.
At this point in time, we strongly encourage your agency to review all of your Federal awards with a project end date that has expired. When appropriate, agencies should spend from the oldest year Federal grant awards before spending from the more current awards, to avoid the loss of Federal funds. Please take appropriate actions now, so that when HHS does close a grant, you would have maximized the use of Federal funds, and also helped to ensure there is no disruption to your programs.
The Final Financial Report submitted by your agency is used by HHS to close out an award, although HHS may close an award prior to receipt of this report. When preparing a Final Report, you should ensure that the reported disbursements match the amount recorded on CAS. No additional charges against that grant award should be incurred after the reporting period specified in the Final Report. After the report is filed, a copy of the report should be forwarded to the Appropriation Section of OSC.
Please refer to New York State Accounting Systems user Procedure Manual, Volume XI, Section 5.0400 for Federal Grants – State Accounting & Reporting Procedures for additional guidance in managing Federal Grants.