Title 7 . Health and Social Services

Chapter 53 . (Reserved)

Section 941. Allowable costs

7 AAC 53.941. Allowable costs

(a) The department will reimburse a grantee for the payment of a cost only if

(1) the grantee provides adequate written evidence, in the form prescribed by 7 AAC 53.901 - 7 AAC 53.999, that the cost was incurred and paid in accordance with the terms of a residential child care facility grant;

(2) the cost is reflected in the budget in the grant agreement;

(3) the cost is an allowable cost; and

(4) the grantee cannot charge the payment for the cost to another current grant or government program.

(b) For the purposes of (a)(3) of this section, the department will classify personnel and training costs as follows:

(1) Costs of compensating an employee for current services are classified as follows:

(A) costs of insurance for which the grantee is a self-insurer are not allowable costs;

(B) costs of fringe benefits that are not available to all permanent full-time employees are not allowable costs;

(C) costs of compensating an employee for services that were not performed during the current grant year are not allowable costs;

(D) costs of food or lodging for an employee, other than food and lodging provided to employees during hours when staff must be present, as required by written policy of the grantee, in order to provide care to minors, are not allowable costs; and

(E) other costs of salaries, meals and lodging, employee health and retirement plans, and other fringe benefits are allowable costs.

(2) Costs of payroll taxes, social security taxes, worker's compensation insurance, federal and state unemployment insurance contribution, and other similar employment expenses that employers are required by law to pay are allowable costs. Such costs are allowable even if, due to the grantee's municipal or nonprofit status, it could elect not to pay them.

(3) Costs of training an employee is classified as follows:

(A) the cost of training an employee is not an allowable cost if the training is in basic skills necessary to make the employee qualified to perform the basic duties for his or her position as set out in the description of the position that is included in the grant agreement; and

(B) costs of on-the-job training and part-time education of current employees of the grantee are allowable costs, if the employees are actively performing services required by the grant, and the training or education is in skills of the kind needed for the grant project.

(c) For the purposes of (a)(3) of this section, the department will classify costs of administrative services and supplies as follows:

(1) Costs of professional services are classified as follows:

(A) costs of retainers for professionals are not allowable costs;

(B) fees, honorariums, or salaries for members of a grantee's corporate board of directors, city council, or borough assembly are not allowable costs;

(C) fees for legal, accountancy, psychiatric, psychological, or medical services are allowable costs.

(2) Costs of office supplies, medical supplies, janitorial and grounds maintenance supplies, kitchen supplies and laundry are allowable costs, to the extent that such supplies are consumed during the grant year in providing services under the terms of the residential child care facility grant.

(3) Telephone, telegram, postage, and other communications costs are allowable costs if the costs were incurred in providing services under the terms of the residential child care grant.

(4) Costs of making and distributing brochures, leaflets, films, and other informational materials for community education are allowable.

(5) Costs of subscriptions to reference and resource periodicals are allowable costs.

(6) Costs of dues for membership of the grantee in an association that is primarily concerned with child care, and that helps to maintain or improve the grantee's operation of a facility are allowable costs.

(7) Costs of bonding, liability, and malpractice insurance for the grantee and for individuals that perform duties under the grant agreement are allowable costs.

(8) Costs of recruiting and relocation of new employees that will perform duties required of the grantee under the residential child care facility grant are allowable costs, to the extent that the amount of such costs does not exceed the amount that the State of Alaska could pay for such costs under the State Administrative Manual.

(9) Costs and fees for preparing biennial reports, reports of changes of address, and other reports required by AS 10.20, are allowable costs.

(10) Costs incurred in achieving accreditation from a national accreditation organization as a residential child care facility are allowable costs.

(11) Uncollectable accounts and costs of collection of debts are not allowable costs.

(12) Costs of preparing residential child care facility grant proposals are not allowable costs.

(d) For the purposes of (a)(3) of this section, the department will classify costs of program services to children for whom the state has assumed responsibility under AS 47.10 as follows:

(1) Costs of recreation and craft supplies used for program services, including arts and crafts materials, sheet music, phonograph records, tapes, testing and therapy materials, pet supplies, and livestock and poultry feed, are allowable costs.

(2) Costs of individual tutoring for children placed in a facility by the department are allowable costs.

(3) Costs of academic education are allowable costs only if the department has approved, in writing, the academic education program and the costs of the program before the grantee incurs the costs.

(e) For the purposes of (a)(3) of this section, costs of transportation, food, clothing, school supplies, personal grooming, and personal allowances for children for whom the department has assumed responsibility under AS 47.10 are allowable costs.

(f) For the purposes of (a)(3) of this section, the department will classify costs of travel as follows:

(1) Costs of first class air accommodations are not allowable unless less expensive accommodations are not reasonably available, or unless the costs of alternate travel arrangements would exceed those of first class air accommodations.

(2) Costs of travel between an employee's residence and the facility are not allowable.

(3) Actual transportation costs, and per diem costs in the amount that the State of Alaska would pay for state employees under the State Administrative Manual, for employees, children for whom the state has assumed responsibility under AS 47.10, and members of the grantee's governing board, are allowable costs; except that, in its discretion, the department will allow actual costs of moderately priced available accommodations.

(g) For the purposes of (a)(3) of this section, the department will classify costs of certain current expenses for land, buildings and improvements, fixtures, and equipment as follows:

(1) Costs of utilities such as heating fuel, water, gas, electricity, sewerage, and refuse removal, are allowable costs.

(2) Costs of renting land, buildings, and equipment and other personal property are allowable costs.

(3) Costs of a repair or costs of maintenance, including costs of maintenance of roads, buildings, equipment and other personal property, and costs of maintenance agreements for equipment, are allowable only if

(A) the repair or maintenance does not appreciably prolong the useful life of the item;

(B) the repairs or maintenance do not significantly increase the permanent value of the item; and

(C) the repair or maintenance does not exceed $5,000.

(4) Costs of real or personal property taxes are allowable only if the department approves payment of the costs and the grantee cannot legally avoid payment of the taxes.

(h) For the purposes of (a)(3) of this section, the department will classify depreciation and use costs of building, land, land improvements, and equipment as described in this subsection.

(1) Depreciation costs of land are not allowable costs.

(2) Costs of assets that are idle during the grant year are not allowable costs.

(3) To the extent that such assets were acquired as a government grant, depreciation and use costs of assets are not allowable costs if the grantee, or a predecessor in interest to the grantee, acquired them in whole or in part with

(A) money granted by a state, federal, or municipal government or agency; or

(B) as a direct grant or donation from such a government or agency.

(4) Other depreciation or use costs of the grantee's equity in such assets are allowable costs in amounts calculated under 7 AAC 53.945.

(i) For the purposes of (a)(3) of this section, the department will classify costs of borrowing money as follows:

(1) Costs of borrowing money actually used for the purchase or repair of real property, equipment, or capital improvements used for delivering residential child care services are allowable costs, if the loan is secured by a security interest in the real property, equipment, or capital improvements.

(2) Interest costs for periods before the actual payment of the purchase price of realty, goods, or services are not allowable costs.

(3) Except in the case of the costs of the services of a real estate broker for real estate purchases, or the services of an attorney, costs of services rendered in negotiating a loan or the purchase or sale of an asset are not allowable costs.

(j) For the purposes of (a)(3) of this section, the department will classify costs of fire insurance, general liability insurance, boiler insurance, and other property insurance as allowable costs.

(k) For the purposes of (a)(3) of this section, the department will classify the costs of purchasing an item of equipment as an allowable cost if the total cost of purchasing the item is $5,000 or less.

( l ) For the purposes of (a)(3) of this section, the department will classify a cost that is not described in this section as an allowable cost only if the department approves the nature and the amount of the cost before the grantee incurs it.

(m) For the purposes of (a)(3) of this section, costs described at AS 47.40.041 (c) are not allowable costs.

History: Eff. 1/13/85, Register 93

Authority: AS 47.05.010

AS 47.40.011

AS 47.41.041

Editor's note: A copy of the applicable portion of the State Administrative Manual cited in 7 AAC 53.941(f) (3) may be obtained from the office of the commissioner of the Department of Health and Social Services.