(a) Allowable costs for programs under title II and title III shall
be charged (allocated) to a particular cost objective/category to the
extent that benefits are received by such cost objective/category. Joint
and similar types of costs may be charged initially to a cost pool used
for the accumulation of such costs pending distribution in due course to
the ultimate benefitting cost objective/category. The classification of
costs for programs under title III of the Act are set forth at
Sec. 631.13 of this chapter, Classification of costs at State and
substate levels.
(b) For State-administered programs under Title II, the State is
required to plan, control, and charge expenditures against the following
cost objectives/categories:
(1) Titles II-A and II-C (combined)--capacity building and technical
assistance (sections 202(c)(1)(B) and 262(c)(1)(B) of the Act to carry
out activities pursuant to sections 202(c)(3)(A) and 262(c)(3)(A) of the
Act);
(2) Titles II-A and II-C (combined)--8 percent coordination
(sections 202(c)(1)(C) and 262(c)(1)(C) of the Act to carry out
activities pursuant to section 123(d)(2)(A) of the Act);
(3) Titles II-A and II-C (combined)--8 percent services/direct
training (sections 202(c)(1)(C) and 262(c)(1)(C) of the Act to carry out
activities pursuant to section 123(d)(2)(B) of the Act);
(4) Titles II-A and II-C (combined)--8 percent services/training-
related and supportive services (sections 202(c)(1)(C) and 262(c)(1)(C)
of the Act to carry out activities pursuant to section 123(d)(2)(B) of
the Act);
(5) Titles II-A and II-C (combined)--8 percent services/
administration (sections 202(c)(1)(C) and 262(c)(1)(C) of the Act to
carry out activities pursuant to section 123(d)(2)(B) of the Act);
(6) Titles II-A and II-C (combined)--8 percent services to
disadvantaged (section 202(c)(1)(C) and 262(c)(1)(C) of the Act to carry
out activities pursuant to section 123(d)(2)(C) of the Act);
(7) Title II-A--older individuals/direct training (section
202(c)(1)(D) of the Act to carry out activities pursuant to section
204(d) of the Act);
(8) Title II-A--older individuals/training-related and supportive
services (section 202(c)(1)(D) of the Act to carry out activities
pursuant to section 204(d) of the Act);
(9) Title II-A--older individuals/administration (section
202(c)(1)(D) of the Act to carry out activities pursuant to section
204(d) of the Act); and
(10) Title II--administration (sections 202(c)(1)(A) and
262(c)(1)(A) of the Act to carry out activities pursuant to Title II of
the Act, including Title II-B).
(c)(1) SDA grant recipients and their subrecipients shall plan,
control, and charge expenditures, excluding incentive funds received
pursuant to sections 202(c)(1)(B) and 262(c)(1)(B) of the Act, against
the following cost objectives/categories:
(i) Title II-A--direct training services;
(ii) Title II-C--direct training services;
(iii) Title II-A--training-related and supportive services;
(iv) Title II-C--training-related and supportive services;
(v) Title II-B--training and supportive services;
(vi) Title II-A--administration;
(vii) Title II-B--administration; and
(viii) Title II-C--administration.
(2) Incentive funds received pursuant to sections 202(c)(1)(B) and
262(c)(1)(B) of the Act, may be combined and accounted for in total,
without regard to cost categories or cost limitations.
(d) States and subrecipients shall use the following definitions in
assigning costs to the cost categories contained in paragraphs (b) and
(c) of this section:
(1) Direct training services--title II-A. Costs for direct training
services that may be charged to the title II-A program are:
(i) The personnel and non-personnel costs directly related to
providing those services to participants specified in section 204(b)(1)
of the Act and which can be specifically identified with one or more of
those services. Generally, such costs are limited to:
(A) Salaries, fringe benefits, equipment, supplies, space, staff
training, transportation, and other related costs of personnel directly
engaged in providing training; and
(B) Salaries, fringe benefits, and related non-personnel costs of
program component supervisors and/or coordinators as well as clerical
staff, provided such staff work exclusively on activities or functions
specified in section 204(b)(1) of the Act or allocations of such costs
are made based on actual time worked or other equitable cost allocation
methods;
(ii) Books, instructional materials, and other teaching aids used by
or for participants;
(iii) Equipment and materials used in providing training to
participants;
(iv) Classroom space and utility costs;
(v) Costs of insurance coverage of participants as specified at
Sec. 627.315(b) of this part, Benefits and Working Conditions;
(vi) Payments to vendors for goods or services procured for the use
or benefit of program participants for direct training services,
including:
(A) Payments for commercially available training packages purchased
competitively pursuant to section 141(d)(3) of the Act;
(B) Tuition charges, entrance fees, and other usual and customary
fees of an educational institution when such tuition charges, entrance
fees, or other fees are not more than the educational institution's
catalogue price, necessary to receive specific training, charged to the
general public to receive the same training, and are for training of
participants; and
(C) Payments to OJT employers, but not brokering contractors. Costs
incurred under brokering arrangements shall be allocated to all of the
benefitting cost categories, and
(vii) Payments to JTPA participants that represent hours spent in a
direct training activity (e.g., wages, work-based training payments,
training payments for combined activities), including work experience,
vocational exploration, limited internships, and entry employment.
(2) Direct training services--title II-C. Costs for direct training
services that may be charged to the title II-C program are the costs
identified in paragraph (d)(1) of this section as well as costs directly
related to providing those services to participants specified in section
264(c)(1) of the Act and which can be specifically identified with one
or more of those services.
(3) Training-related and supportive services--title II-A. Costs for
training-related and supportive services that may be charged to the
title II-A program are:
(i) The personnel and non-personnel costs directly related to
providing outreach, intake, and eligibility determination, as well as
those services to participants specified in section 204(b)(2) of the
Act, and which can be specifically identified with one or more of those
services. Generally, such costs are limited to:
(A) Salaries, fringe benefits, equipment, supplies, space, staff
training, transportation, and other related costs of personnel directly
engaged in providing training-related and/or supportive services; and
(B) Salaries, fringe benefits, and related non-personnel costs of
program component supervisors and/or coordinators as well as clerical
staff, provided such staff work exclusively on activities or functions
specified in section 204(b)(2) of the Act or allocations of such costs
are made based on actual
time worked or another equitable allocation method.
(ii) Needs-based payments, cash incentives and bonuses, other
financial assistance and supportive services to participants and
applicants, where applicable.
(4) Training-related and supportive services--title II-C. Costs for
training-related and supportive services that may be charged to the
title II-C program are the costs identified in paragraph (d)(3) of this
section, as well as costs directly related to providing those services
to participants specified in section 264(c)(2) of the Act and which can
be specifically identified with one or more of those services.
(5) Administration. The costs of administration are those portions
of necessary and allowable costs associated with the overall management
and administration of the JTPA program and which are not directly
related to the provision of services to participants or otherwise
allocable to the program cost objectives/categories in paragraphs
(b)(1)-(8) or (c)(1) (i)-(v) of this section. These costs can be both
personnel and non-personnel and both direct and indirect. Costs of
administration shall include:
(i) Except as provided in paragraph (e)(1) of this section, costs of
salaries, wages, and related costs of the recipient's or subrecipient's
staff or PIC staff engaged in:
(A) Overall program management, program coordination, and general
administrative functions, including the salaries and related costs of
the executive director, JTPA director, project director, personnel
officer, fiscal officer/bookkeeper, purchasing officer, secretary,
payroll/insurance/property clerk and other costs associated with
carrying out administrative functions;
(B) Preparing program plans, budgets, schedules, and amendments
thereto;
(C) Monitoring of programs, projects, subrecipients, and related
systems and processes;
(D) Procurement activities, including the award of specific
subgrants, contracts, and purchase orders;
(E) Providing State or local officials and the general public with
information about the program (public relations);
(F) Developing systems and procedures, including management
information systems, for assuring compliance with program requirements;
(G) Preparing reports and other documents related to the program
requirements;
(H) Coordinating the resolution of audit findings;
(I) Evaluating program results against stated objectives; and
(J) Performing such administrative services as general legal
services, accounting services, audit services; and managing purchasing,
property, payroll, and personnel;
(ii) Costs for goods and services required for administration of the
program, including such goods and services as rental or purchase of
equipment, utilities, office supplies, postage, and rental and
maintenance of office space;
(iii) The costs of organization-wide management functions; and
(iv) Travel costs incurred for official business in carrying out
program management or administrative activities, including travel costs
incurred by PIC members.
(e) Other cost classification guidance. (1) Personnel and related
non-personnel costs of the recipient's or subrecipient's staff,
including project directors, who perform services or activities that
benefit two or more of the cost objectives/categories identified in this
section may be allocated to the benefitting cost objectives/categories
based on documented distributions of actual time worked or other
equitable cost allocation methods.
(2) Indirect or overhead costs normally shall be charged to
administration, except that specific costs charged to an overhead or
indirect cost pool that can be identified directly with a JTPA cost
objective/category other than administration may be charged to the JTPA
cost objective/category directly benefitted. Documentation of such
charges shall be maintained.
(3) Where an award to a subrecipient is for a ``commercially
available off-the-shelf training package,'' as defined at Sec. 626.5 of
this chapter, the subrecipient may charge all costs of such
package to the direct training services cost category.
(4) Profits, fees, and other revenues earned by a subrecipient that
are in excess of actual costs incurred, to the extent allowable and
consistent with the guidelines on allowable costs prescribed by the
Governor in accordance with Sec. 627.435(i). Cost principles and
allowable costs, may be allocated to all three cost categories based on
the proportionate share of actual costs incurred attributable to each
category.
