14 Ill. Adm. Code 540.70
Program Administration Requirements
Section 540
Section 540.70 Program
Administration Requirements
a) Program Targeting – Services provided through grants under
Sections 540.60(a) and (d) of this program must benefit Illinois business as
that term is defined in Section 46.19a(2)(e) of the Civil Administrative Code
of Illinois (Ill. Rev. Stat. 1984 Supp., ch. 127, par. 46.19a(2)(e)) and as
determined by the review process in Section 540.50.
b) Eligible Grant Recipients – Grants may be awarded by the
Department to business, universities, research institutions, research
consortia, and other not-for-profit entities, consistent with the legislative
intent for each particular grant category as specified in Section 540.60 of
this Part.
c) Property Records – The recipient agrees to maintain property
records and at least annually conduct an inventory of all equipment or
nonexpendable personal property purchased with grant funds. Equipment must be
used on the original project as long as needed. While being used on the
original project, equipment may be made available for "shared use"
with other activities provided that use will not interfere with its use for the
original project. When no longer needed for the original purpose, equipment
may be used for other projects (projects of the Department are to be given
first priority, if there is a choice).
d) Record Retention and Review – Recipients and their
subcontractors must permit any agent authorized by the Department upon
presentation of credentials, in accordance with the constitutional limitations
on administrative searches, to have full access to and the right to examine any
documents, papers and records of the recipient involving transactions related
to a grant under this program. To the extent authorized by the Freedom of
Information Act (Supp. to Ill. Rev. Stat. 1983, ch. 116, pars. 201 et seq.),
the Department will not make public any information disclosing program
supported technical information if the recipient believes such disclosure would
affect the commercialization potential of the project. The term
"subcontractor" as used in this clause excludes purchase orders not
exceeding $2,500.00.
e) Financial Management Standards – A recipient's financial
management system shall be structured under the Accounting Standards of the
Financial Accounting Standards Board of the American Institute of Certified
Public Accountants (AICPA) (June, 1984) in accordance with the reporting
requirements specified in Section 540.70(u) of this Part. The recipient is
accountable for funds received under this grant and shall maintain effective
control and accountability over all funds, equipment, property, and other
assets under the grant. The recipient shall keep records which detail the
recipient's expenditures of grant funds and accurately document the recipient's
Expenditure Summary and Payments Request Form submitted pursuant to Section 540.70(u).
f) Method of Compensation –
1) Payments pursuant to a grant are subject to the availability
of funds appropriated by the General Assembly.
2) Payments to the recipient are subject to the initiation of an
invoice voucher. The first payment for program initiation may be an advance
for the first month's cash needs. Thereafter, the payments are dual purpose in
that they will be sufficient to cover the expenditures to date as well as the
cash needs of the recipient for the next period.
g) Audits – The recipient will conduct an audit of all program
records which reflect the actual activities conducted and the actual costs and
expenses incurred by the recipient, using an independent public accountant,
certified and licensed by authority of the State of Illinois. The audit must
be conducted in accordance with generally accepted auditing standards adopted
by the Codification of Statements on Auditing Standards of the AICPA (January,
1983) and must be submitted to the Department within 45 days of the expiration
of the grant. If the recipient is routinely audited by the Auditor General of
the State of Illinois, the grant need not be audited separately by the
recipient. The audit is to include both the state and required matching share
of the project. The recipient shall be responsible for taking the necessary
steps to correct any deficiencies disclosed by such audit, including such
action as the Department, based on its review of the audit report, may direct.
Ten copies of each audit report shall be transmitted to the Department. The
recipient shall keep a copy of each audit on file for at least three (3) years.
h) Modification and Amendment of the Grant – The Grant Award is
subject to revision as follows:
1) Modifications by Operation of Law – The Grant Award is subject
to such modifications as may be required by changes in state law or
regulations. Any such required modification shall be incorporated into and
made a part of the grant within the provisions of the Illinois Grant Recovery
Act (Ill. Rev. Stat. 1983, ch. 127, par. 2301 et seq.). The Department shall
notify in writing the recipient of any amendment to such regulations.
2) Modifications in Budget – If the recipient has reason to
believe that its operation for the grant period will exceed the budgeted
amount, it shall request prior approval of the Department, except that upon
specific prior approval of the Department the recipient may vary budgeted line
items or cost categories. Any changes in cost categories or line items shall
not alter the activities or delivery systems for the project. Requests for
budget variations shall be in writing and shall give justifications for the
requested variations. The Department will approve modification requests if
they are necessary to achieve program objectives; required by increases or
decreases in program funding; or result in greater cost efficiencies. If the
Department approves the modification request, the recipient will be notified in
writing of the change and effective date. If the Department rejects the
modification, the Department will notify the recipient in writing of the
reason(s) for denial.
3) Other Modifications by Department or Recipient – If either the
Department or the recipient desires to modify the terms of the Grant Award
other than as set forth in subsections (1) and (2) above, written notice of the
proposed modification shall be given to the other party. No modification shall
take effect unless agreed to in writing by both the Department and the
recipient, except that if the Department proposes a modification without prior
agreement of the recipient, the recipient will be notified of the modification
by registered letter and be notified that failure to respond within 30 days of
the date of the letter will be deemed acceptance of the modification, which
will become effective as of the specified future date.
i) Suspension and Termination –
1) If the Department believes that a recipient has failed to
comply with the terms and conditions of the Grant Award, then the Department
shall suspend the grant and withhold further payments until the grant is
terminated, or the recipient's failure has been corrected. The Department will
determine that a recipient has failed to comply with the terms and conditions
of a grant when:
A) The Department has notified the recipient in writing of the
existence of circumstances such as, consistent failure to submit required
reports, failure to protect inventory, misuse of equipment purchased with grant
funds, evidence of fraud and abuse, consistent failure to meet performance
standards, or failure to resolve negotiated points of the agreement, and
B) the recipient fails to develop and implement a corrective action
plan within 45 days of the Department's notice.
2) A grant shall be terminated in the absence of full state
funding; if the Department determines that the recipient has failed to comply
with the terms and conditions of the grant in whole or in part; or if the
Department and the recipient agree to terminate the grant.
j) Nondiscrimination – The recipient shall refrain from unlawful
discrimination in employment and undertake affirmative action to assure
equality of employment opportunity and eliminate the effects of past
discrimination in accordance with the Illinois Human Rights Act (Ill. Rev.
Stat. 1983, ch. 68, pars. 1-101 et seq.).
k) Complaint Process – In the case of a recipient complaint, the
Department will follow the procedures outlined in the Administrative Review Law
(Ill. Rev. Stat. 1983, ch. 110, pars. 3-101 et seq.).
l) Royalty-Free Use for State Agencies – The Department, or its
agents, shall negotiate royalties with recipients on any subject data,
copyrights, patents, or technical data to be developed under the recipient's
contract as part of the specified work plan i
f the product or service to be
developed by the grantee is subsequently licensed for production
(Ill. Rev.
Stat. 1984 Supp., ch. 127, par. 46.19a(2)). These royalties shall include
negotiated monetary compensation and royalty-free use of the product or service
by the Department.
m) Patent and Technical Information – Recipient copyright and
patent policies must provide for protection of technical information, identify
ownership and control of patents, detail procedures for the sale or licensing
of patents and protect government use of patented and copyrighted items.
n) Publication, Promotion, and Marketing – Recipients must inform
the Department of the nature and contents of all public information and
promotional documents prior to or concurrent with the dissemination of such
information and documents (i.e., program reports, annual reports, informational
brochures, fact sheets, manuals, or other similar documents). Any failure to
submit this information shall not be the sole basis for termination of a Grant
Award. In addition, all such documents must include acknowledgement of the
support of the Department of Commerce and Community Affairs and must include
logo(s) identified by the Department.
o) Program Coordination – The Department will require applicants
to arrange for program coordination with existing services of federal or state
agencies and with those projects funded under this program.
p) Program Income – Income generated under any program and
accrued interest on such program income shall be used to further program
objectives when retained by the recipient or may be remitted to the State.
q) Administrative Costs – There is a 15 percent ceiling on the
amount of a Department grant which can be used for general indirect costs
incurred. Entities which want to recover indirect costs shall do so in
accordance with their approved cost plan. An approved cost plan is one which
has been approved by the entity's cognizant federal agency or the Department.
r) Program Match – Each recipient must match Department funds.
Match can include in-kind or cash contributions as well as indirect cost
contributions. Program income generated from project activities can also be
counted as match. Grant monies or other funds received from the federal
government or from state entities can be counted as match, provided that such
funds are reprogrammed to directly relate to the objectives of the project.
Matching contributions must:
1) be under the control of the project officer;
2) be identified in the recipient's application as necessary for
the proper and efficient administration of the project;
3) be incurred during the Grant Award period;
4) be supported by records of services rendered and/or detailed
documentation of costs incurred; and
5) not be a general expense of the recipient which is incurred in
carrying out overall responsibilities other than those required under this
grant.
s) Interest on Grant Funds – In accordance with Section 10 of the
Illinois Grant Funds Recovery Act (Ill. Rev. Stat. 1983, ch. 127, par. 2310),
all interest earned on funds held by the recipient under this grant shall
become part of the grant when earned; however, interest earned on grant funds
may be retained by the recipient when the cost of accounting for the interest
or allocating the interest to the grant is more than the amount of interest
earned. Any interest earned under the grant, and not expended as grant
principal during the term of the grant, shall be returned to the Department.
t) Return of Unobligated Funds – In accordance with Section 4(d)
of the Illinois Grant Funds Recovery Act (Ill. Rev. Stat. 1983, ch. 127, par.
2304), the recipient shall refund to the Department within 45 days after the
expiration of the grant any balance of funds that were unobligated at the end
of the grant period.
u) Program Reports – Each recipient is required to report
financial and programmatic data to the Department on a regular basis on forms prepared
by the Department. Standard reports are as follows:
1) Expenditure Summary – The recipient shall maintain appropriate
records of actual grants costs on Expenditure Summaries supplied by the
Department. These Expenditure Summaries will identify line item costs charged
to the grant and line item matching share supplied by the applicant or third
parties. Expenditure Summaries are to be submitted to the Department by the 10
th
day following the end of each month.
2) Client Status Report – Each recipient shall maintain
individual records of each client provided service through the project using
the Client Status Report supplied by the Department. These Client Status
Reports will identify basic demographic information about the firm being assisted,
summarize the work plan designed for this firm, and relate the manner and types
of service delivered. One copy of each active Client Status Report shall be
delivered to the Department on a monthly basis, due the 10th day following the
end of each month.
3) Quarterly Program Report – Each recipient shall prepare a
Quarterly Program Report in the form designated by the Department. The
Quarterly Program Report shall include an aggregated statistical summary of
small businesses and firms served, their demographic composition, and the types
of services delivered; and a narrative report on progress towards achieving
objectives and activities, economic impact of the program, and a list of
business/institutional interactions. Quarterly Program Reports shall be
submitted to the Department by the 10th day following the end of each program
quarter.
v) Monitoring and Evaluation – The Department will monitor and
evaluate the grant made to the recipient under this program. The grant will be
monitored for compliance with the Section 540.70 and will be monitored
periodically throughout the program year. The grant will be evaluated to gauge
its impact upon the business community and for the effective and efficient
utilization of funds. Evaluations will occur both during the operation of the
program and upon its completion.
w) State Not Liable – The recipient shall save the State of
Illinois harmless from any and all claims, demands, and actions based upon or
arising out of any services performed by themselves or by their associates and
employers under this grant.