La. Admin. Code tit. 40 § XIII-121

Current through Register Vol. 50, No. 11, November 20, 2024

Section XIII-121 - Carry-Over Balances

A. Funds obligated for any program year may be expended by each recipient or service delivery area grant recipient during that program year and the two succeeding program years with the following exceptions.

1. Title II-A and Title II-C-Reallotment and Reallocation Policy

a. For program years beginning on or after July 1, 1993, the governor shall, in accordance with §109 of the Act and §627.410 of the federal regulations, reallocate to eligible service delivery areas within the state funds appropriated for such program year that are available for reallocation.

b. The amount available for reallocation is equal to the amount by which the unobligated balance of the SDA's allocation under Part A and Part C of Title II at the end of the program year prior to the program year for which the determination is made exceeds 15 percent of such allocation for the prior program year.

c. In addition, Louisiana will use the reallotment process for SDAs at the end of each program year whether or not the state is subject to a reduction in funding due to reallotment. This will allow the state to deal with significant underexpenditure of funds by individual SDAs even when the state maintains a high overall level of expenditures.

d. In the event that Louisiana is not subject to a reduction in funding, but one or more SDAs are subject to a reduction based on Louisiana's policy, funds deobligated from such SDAs will be allocated to the remaining SDAs who are not subject to a reduction that have the highest rates of unemployment for an extended period of time and to those with the highest poverty rates.

2. Title II-B-Reallocation Policy

a.Section 161(b) of the Act provides that no amount of funds "shall be deobligated on account of a rate of expenditure which is consistent with the job training plan." In order to remain consistent with this policy, if an SDA's rate of expenditure is inconsistent with the job training plan, its new obligational authority (NOA) may be reduced in subsequent years in order to, in effect, reallocate funds from that program year.

b. Beginning in Program Year 1995 and applying to Program Year 1994, an amount equivalent to 15 percent of the previous year's total funds available will be classified as "allowable carry-out."

c. All other carry-out will be designed as "excess carry-out" and the obligational authority (NOA) to the SDA will be reduced by the amount of the excess carry-out. Determination of total carry-out and the excess carry-out will be made after submittal of the final program year expenditure report and reallocation of funds will be made to those SDAs which request the funds and have expended more than 85 percent of their total funds available. The reallocation will be based on the degree that SDAs exceed the 85 percent expenditure level.

3. Title III-Reallotment and Reallocation Policy

a. Excess Unexpended Funds

i. The U.S. Department of Labor has established Title III reallotment procedures that have the effect of limiting the amount of unexpended funds that can be carried over by the state at the end of each program year. Reallotment also rewards states with high expenditure rates by providing additional funds. These procedures are described in Section 303 of the Job Training Partnership Act, Section 6305(e) of the Economic Dislocation and Worker Adjustment Assistance Act, §631.12 of JTPA Federal Regulation, and Training and Employment Guidance Letter (TEGL) No. 4-88 issued by the U.S. Department of Labor.

ii. Reallotment will occur around September 1 and will result in an increase or decrease in the state's formula-allotted funds for the current year based on a reallotment process applied to the prior year's Title III funds and expenditures. When reallotment results in an increase in funding, such reallocation is subject to allocation procedures specified in §631.32 of the federal regulations. When reallotment results in a decrease in funding, the procedures that follow will be used to recover funds from substate grantees and, where appropriate, state subcontractors in order to make funds available to the U.S. Department of Labor for reallotment. Any remaining funds would come from the governor's 40 percent funds.

iii. Louisiana will apply the same reallotment procedures to sub-state grantees and state subcontractors that the U.S. Department of Labor applies to the state. Our reallotment policy states that the amount available for reallotment from substate grantees and state subcontractors is equal to the sum of unexpended funds in excess of 20 percent of the prior year's allocation or subgrant amount and all unexpended previous program year funds. For PY 88 allocations and subgrants, 30 percent shall be substituted for 20 percent in the previous sentence. Unexpended reallocated funds at the end of the year will also be subject to the 20 percent limitation on allowable carry forward. Substate grantees and state subcontractors that lose funds through the reallotment process will use their allocation or subgrant amount before reallotment in order to calculate allowable carry forward.

iv. In addition, Louisiana will use the reallotment process for substate grantees and, where appropriate, state subcontractors at the end of each program year whether or not the state is subject to a reduction in funding due to reallotment. This will allow the state to deal with significant underexpenditure of funds by individual substate grantees and state subcontractors even when the state maintains a high overall level of expenditures.

v. In the event that Louisiana is not subject to a reduction in funding, but one or more substate grantee(s) or state subcontractor(s) are subject to a reduction based on Louisiana's policy, funds deobligated from such substate grantees will be allocated by formula to the remaining substate grantees who were not subject to a reduction. This allocation will be in addition to any funds reallocated by the U.S. Department of Labor and subsequently allocated to substate areas. Any funds deobligated from state subcontractors as a result of these procedures are subject to regular Title III state obligation procedures.

b. Projected Excess Unexpended Funds

i. Louisiana is subject to a U.S. Department of Labor JTPA Title III reallotment process based on expenditures at the end of each program year. In order to avoid a reduction in funding from such a reallotment, a deobligation procedure has been established.

ii. Title III substate grantees and state subcontractors are subject to deobligation of projected excess unexpended funds based on expenditures during the first five months of their subgrant or subcontract period. Projected excess unexpended funds are defined as any amount of projected unexpended funds in excess of 20 percent of a substate grantee's available funds (excluding carry-in funds and any additional funds reallocated during that program year as a result of the U.S. Department of Labor's reallocation process) or 20 percent of a subcontract amount. Projected unexpended funds are total available funds (excluding reallocated funds) less expenditures reported for the first five months and less an amount equal to the higher of the last two months reported expenditure amounts times the number of months remaining in the subgrant or subcontract period. Expenditure amounts used for this process will be those amounts reported as of the official due date specified by the Louisiana Department of Labor's fiscal section. Funds remaining after deobligation will be subject to all cost category limitations.

iii. Substate grantees and state subcontractors will have 15 days from the date they are notified of any amount subject to deobligation to provide documentation to the Louisiana Department of Labor why they should not be subject to such deobligation. The Louisiana Department of Labor may reduce the amount to be deobligated based on acceptance of documentation of corrected expenditure amounts, significant recent obligations not reflected in current reported expenditures, or other appropriate justification.

iv. All funds deobligated from substate grantees will be allocated by formula to substate grantees whose total projected unexpended funds are not expected to exceed allowable projected unexpended funds. Funds deobligated from state subcontractors are subject to regular Title III state obligation procedures.

v. This deobligation procedure does not limit the Louisiana Department of Labor's authority to unilaterally deobligate funds from subgrants and subcontractors when it is deemed necessary in order to carry out responsibilities under the Job Training Partnership Act.

4. Reallocation Waiver. The reallocation policies may be waived for SDAs and substate grantees operating under a reorganization plan issued by the governor in accordance with procedures established by the recipient.

La. Admin. Code tit. 40, § XIII-121

Promulgated by the Department of Labor, Office of Labor, LR 9:334 (May 1983), amended LR 10:546 (July 1984), LR 15:496 (June 1989), amended by the Department of Employment and Training, Office of Labor, LR 17:357 (April 1991), amended LR 18:372 (April 1992), repromulgated LR 18:493 (May 1992), amended by the Department of Labor, Office of Labor, LR 19:1585 (December 1993).

AUTHORITY NOTE: Promulgated in accordance with R.S. 23:2022.