Categorizing Expenditures

The AT Act requires each grantee have a mechanism in place to accurately track all AT Act expenditures by grant award fiscal year and by the categories of state-level and state leadership activities. Most direct expenditures, like salaries and benefits, contractual expenses, and direct service expenses, will be readily attributable to a state-level or state leadership or transition activity. For example, expenditures for purchasing equipment for a device loan program will be a state-level expense, while staff salaries and travel expenses to deliver training will be state leadership.

One helpful mechanism for determining if an expense should be categorized as state-level, state leadership, or transition is to identify where the data associated with that expense is reported. Since most all State AT Program activities should have associated data reported, where such data is reported (state-level or state leadership activities) provides a good indication of how the expenditures should be categorized. Most staff salaries and benefits can be assigned in total or in pro-rated percentages to state level or state leadership depending on staff job responsibilities and any time and effort logs required for federal record-keeping purposes.

For very generic administrative and operational expenditures, such as paper, general office supplies, and similar expenditures, an arbitrary ratio allocation can be used, such as a 50/50 split. A more accurate prorated split can be used in areas where there is sufficient justification to do so. For example, if the personnel split between state-level and state leadership is 55% state-level and 45% state leadership, then it would be logical to apply that ratio to office space utility expenses if the space correlates closely with staff positions.

If an indirect cost rate is used, the arbitrary ratio allocation (e.g., 50/50) can be applied to that amount for purposes of reporting by state-level and state leadership categories. Please note that any general administrative expenditures should be limited to a small portion of the federal AT Act grant award, as the vast majority of AT Act award dollars should be allocated for direct program service costs rather than administrative and overhead costs. It is very difficult to justify claiming the 10% indirect rate allowed by the AT Act along with prorated additional administrative costs as direct expenses (usually done as a prorated cost allocation plan).

Section 4 AT Act grantees are strongly encouraged to use either the 10% indirect provision to support administrative and overhead costs OR a cost allocation plan where administrative and overhead costs are prorated as direct cost expenditures, but not both. Using both mechanisms to pay for administrative costs creates a significant risk of duplicative expenses for same/similar cost items and potential audit findings. Claiming both a 10% indirect rate and direct administrative expenses will also divert a significant amount of available federal funding from support of direct AT services.

Advisory council expenses can be prorated based on the typical work of the council. If the agenda topics are routinely balanced between state-level and state leadership activities, then a 50/50 split might be appropriate. If the advisory council focuses more energy on administrative oversight or policy issues, then a more appropriate split might be 25% state-level and 75% state leadership. If the advisory council serves any purpose other than that outlined in the AT Act, expenses should be based on less than a 100% total, charging to the AT Act grant only the portion of time dedicated to AT Act activity oversight.

Similarly, professional development expenses can be prorated based on the typical work responsibilities of those attending (e.g., how they will apply the knowledge gained via the professional development in their job), or it may be more appropriate to allocate such expenses based on the content of the professional development, especially if the training activity is narrowly focused on state-level or state leadership activities. Very general professional development (e.g., all staff diversity training) can be allocated using arbitrary splits if that is most efficient. For example, professional development expenses for a staff person who oversees the device loan and demonstration program to attend ATIA and CSUN each year to remain current on AT products could be categorized as 100% state-level, corresponding to the person’s FTE classification. A person whose job responsibilities are split between state-level and state leadership (60%/40%) attending the same conferences could have those travel expenses allocated using the same percentages aligned with the FTE categorization.

The expenditure tracking system used by grantees should be able to consistently categorize expenditures as state level, state leadership, or transition based on a clear rationale for each categorization or prorated split.

Last updated January 2023