HomeMy WebLinkAboutRES 2023-049KITTITAS COUNTY BOARD OF COUNTY COMMISSIONERS
REsoLUflON No. zo'f.- 0 4 7
A Resolution Adopting a Gentral Services Simplified lndirect Gost
Allocation Plan for Budget Year 2O23
WHEREAS, Kittitas County is a recipient of Federalgrant awards, and
WHEREAS, pursuant to CFR Title 2, Subtitle A, chapter ll, Part 200, tJniform
Administrative Requirements, Cost Principles, and audit Requirements for Federal
Awards, local government grant recipients are required to adopt a central services
simplified indirect cost allocation plan in order to claim such costs for reimbursement, and
WHEREAS, the County Auditor has determined the lndirect Cost Rate to be
13.25Vo, based on the fair and equitable distribution base of direct salaries & wages of
each departmenVfund, and;
WHEREAS, the County Auditor has certified the lndirect Cost Rate of 13.3o/o', a
reduction from the actual calculation to allow for a margin of error, and
WHEREAS, the attached documentation shows the calculations of the lndirect
Cost Plan for Kittitas County as per the requirements for 2 CFR Part 200, Uniform
Administration Requirements, Cost Principles and Audit Requirements for Federal
Awards (Uniform Guidance).
NOW, THEREFORE BE lT RESOLVED that the Board of County Commissioners
adopts the lndirect Cost Rate for Kittitas County at 13.3o/o based on the fair and equitable
distribution base of direct salaries & wages, for federal grant reimbursement as certified
by the County Auditor, effective January 1, 2023.
ADOPTED this 4th day of April, 2023.
BOARD OF COUNTY COMMISSIONERS
KITTITAS NTY INGTON
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ABSENT
Co mmtsstoner
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KITTITAS COUNTY
CERTIFICATE OF COST ALLOCATION PLAN
This is to certify that I have reviewed the cost allocation plan submitted herewith and to
the best of my knowledge and belief:
(1) All costs included in this proposal for the period ended December 31, 2021 are to
establish cost allocations or billings starting January 1, 2023 are allowable in
accordance with the requirements of the Part; 2 CFR Part 200, "Uniform Administration
Requirements, Cost Principles and Audit Requirements for FederalAwards" and the
Federal award(s) to which they apply. Unallowable costs have been adjusted for in
allocating costs as indicated in the cost allocation plan.
(2)All costs included in this proposal are properly allocable to Federal awards on the
basis of a beneficial or causal relationship between the expenses incurred and the
Federal awards to which they are allocated in accordance with applicable requirements
Further, the same costs that have been treated as indirect costs have not been claimed
as direct costs. Similar types of costs have been accounted for consistently.
I declare that the foregoing is true and correct.
Governmental Unit: Kittitas County Central Services
The 2021 rate approved is 13.3%
?
Signature
Name of Official: Brvan Elli ott
Title: Kittitas Countv Auditor
Effective Date: Januaw 1.2023
Summarv:
o The attached Resolution and plan documents reflectthe County's internal allocation of administrative costs
o This is presented annually to BOCC. Public Health and Sheriff each produce similar annual cost-rate plans.
o The Auditor's recommended rate is 13.3%
Background:
lndirect Cost Allocation refers to the cost of certain county departments to provide services to other County
Departments. This enables a quantifiable, reasonable and consistent way to offset the County's costs to
administer grants.
lndirect Cost Allocation is also applicable to certain County contracts, and for internal accounting and
budgeting, e.g. Departments and/or Funds pay one another for the provision of services.
A cost allocation plan is required for most Fed grant recipients. A plan's threshold requirements are
established by the Federal Office of Management and Budget.
The rate calculation is formula-driven, and uses the most-recent audited financial data. Therefore, there is
commonly a two-year lag for implementation of a given rate. E.g.2O2L data is used to establish a rate for
operations in2O23.
The rate calculation is forwarded to the County Auditor, who then commonly applies a margin of error to
arrive at a final "certified" rate. The Certified rate is forwarded to BOCC for review/approval.
Analvsis:
Staff Report bv:
Brian Carlson
Budget and Finance Director
Topic:
Annual lndirect Cost Allocation Plan
2022
16.89%
15.00%
1.89o/o
Meeting
BOCC Regular Meeting
April4,2O23
a
a
a
a
o The current plan and recent history are shown below
Effective Year 2019 2020 2021
Actual Rate 13.01o/o 14.44o/o 13.36%
Adopted Rate 12.75o/o 12.75o/o 12.75o/o
Variance 0.260/o 1.690/o 0.610/0
2023
13.25o/o
13.30o/o
0.05%
r The 2023 "actual" rate has returned to its historic-norm, following a year (2020) of extraordinary expenses in
the lT Department.
o The recommended "adopted" rate is proposed by the Auditor following his review of the calculated figures.
o Additional plan information and calculations are contained in the attach ed 2023 lndirect Cost Attocotion Plon
Conclusion / Next Steps:
. Approve resolution adopting central services cost allocation plan
Kittitas County
Central Services Simplified lndirect Cost Allocation Plan
Effective January 1, 2023
SUMMARY
The following CentralServices lndirect Cost Allocation Plan ("Plan") memorializes a cost rate for
the provision of indirecf seryices, i.e. services provided by certain County Departments to ofherCounty
departments. The PIan is compiled pursuant to Federal regulations, is revised and formally adopted
annually, and establishes a reasonable and consistent basis to account for internal-service costs. The
rate is established and certified by the County Auditor, and formally adopted via Resolution by the County
Commissioners.
The primary application of the indirect cost rate is for grants-accounting and reporting, though it
can also be used to establish costs for contracted county services, or for internal budgeting and
accounting.
The cosf rafe reflects the countywide indirect services costs as a percentage of direct seruice (i.e.
services provided to County citizens) personnel costs. The rate is calculated based on 2020 audited
figures, and is adjusted to reflect allowable and excluded costs and an error-margin. The 2022indirecl
cost rate is calculated according to the federal Office of Management and Budget simplified method as
follows:
Central Service Department Costs
Other lndirect Costs
Total lndirect Service Costs
Total Direct-Cost Personnel
lndirect Cost Rate
Auditor-Recommended Rate
2,351,886
711,104
3,062,990
22,340,162
13.7o/o
13.70/o
This plan distinguishes lndirect Seruice departments (those that primarily provide services to other
County departments) from Direct Seruice departments (those that primarily provide services to County
citizens).
The accounting, information technology, communications, and human resources departments are
the identified indirect service departments, and are the primary providers of central services. Their
operations are 90To dedicated to internal customers, and their central services costs comprise 80% of
countywide central services costs. There are four other departments (Auditor/Administration, Courhouse,
non-Depaftmental, Treasurer)that provide indirect services, though not as their primary function.
DEFINITIONS
Additional Costs - Additional expenses not accounted for at the department level, including depreciation.
All Other Direct Costs - the amount remaining from total costs less additional expenses, unallowable
costs, indirect costs, and direct salaries & wages.
Capitalized Assets - Purchases of Asset that has a value $5,000 or above and has a life longer than one
year. These assets are depreciated. The Capitalized Asset is removed as an unallowable cost.
Central Services - services that are provided to the organization, the customers of the Central Servicesare the internal departments, which include Auditor Accounting, lnformation Technology,
Communications, and Human Resource.
Central Service Cost allocation plan - means the documentation identifying, accumulating, and allocating
or developing rates based on the allowable costs of services provided by a governmental unit on a
centralized basis to its departments and agencies. The costs of these services may be allocated or billed
to users.
Department - all County Departments and/or County Funds.
Depreciation - Allocating the costs of a Capitalized Asset to periods benefiting the assets use.
Direct Salaries & Waqes - the 2021 fiscal year end salaries & wages for each department
Excluded Costs - Certain items of cost are classified by Uniform Guidance as extraordinary or distorting
expenditures and are excluded from the computation of the indirect cost rate i.e. capitalized equipment.
lndirect Costs - costs incurred for a common or joint purpose benefiting more than one cost objective
lndirect Rate -a devise for determining in a reasonable manner the proportion of indirect costs
each program should bear. lt is the ratio of the indirect coast to a direct cost base.
Sub Department - additional breakdown of a department expenses for accounting purposes
Total Costs - the 2021 fiscal year end actual expenses
Unallowable Costs - Certain items of cost are classified by Uniform Guidance as unallowable, which
means that federal funds cannot be used for those items of cost. For indirect cost rate calculation,
however, these unallowed costs are included in the base along with the direct costs. Some examples for
unallowed costs are: Governance, promotional advertising, entertainment, and fines & penalties.
Uniform Guidance - United States Office of Management & Budget, 2CFR Part 200, Uniform
Administration Requirements, Cost Principles and Audit Requirements for Federal Awards establishing
principles and standards for determining costs for Federal awards carried out through grants, cost
reimbursement contracts, and other agreements with governmental units.
FINANCIAL INFORMATION
Accountinq
Governmental fund financial statements are reported using the current financial resources
measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as
they are both measurable and available. Revenues are considered to be available when they are
collectible within the current period or soon enough thereafter to pay liabilities of the current period.
Audited Data
Kittitas County is audited annually by the State Auditor's office. The audits consist of Financial
and Single Audit and the Accountability Audit. The Financial and Single Audit was issued on February
27,2023, Report #1032086. The report states:
We issued an unmodified opinion on the fair presentation of the financial statements of
the governmental activities, the business-fype activities, each major fund and the
aggregate remaining fund information in accordance with accounting principles generally
accepted in the United Sfales of America (GAAP)
Lrter$al Coutrol or,'s Financial Repcrting:
e Signrfcanf De/icienries. We reported :ro deficiercies iu the dmip or opelation of htunal
conhol st'er financial reporting that un consider to be signilicant deficicucies.
r .l{atedal llranFtesses. trVe identifred deficiercies lhat nn consider to be rnaterial
rl'e{knesses-
We noted no imtmes of nonconptiame tbat were nuterial to the fiuncial statetrents of the
County.
Federal Arvards
lnl€fnal Conhol oler Majnr Frograms:
. SisrtrJicarf .qfcidnrias: tire reportedno deficiencies in the dsign or operation of internal
coulrol oter m.rjor federal propganrs tlrat wr csosidef, to be significaut d,rficiencies-
r .lfnfetftil lt'.'mfuieuser-' trVe idedified no deficiencie* that qe consider to be m-rterial
u'e*ftnessrs.
tr!'e issued an uunodified opinion otr the County's courpliance *'ith requuenrents applicable to its
najorftderal p(oganr.
lTe rtparted no findinp ih.rt are required to be disclased in arrordance wilh I C.FR:00.51qa).1
Depreciation
Capital assets, which includes property, plant, equipment, and infrastructure assets, (e.g., roads,
bridges, sidewalks, and similar items), are reported in the applicable governmental or business{ype
columns in the government-wide financial statements. Capital assets are defined by the county as assets
with an initial, individual cost of more than $5,000 and an estimated useful life more than one year. Such
assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated
capital assets are recorded at estimated fair market value at the date of donation. Kittitas County has
elected to use the modified approach to account for the infrastructure account; Gravel Roads, which
eliminates the need to report depreciation expense.
Computer Software is reported as lntangible Assets with a capitalization limit of $5,000 and is not
depreciated.
Capital Leases are defined as long term debt to the county. The asset is tracked but there is not
value placed in the Capital Assets. Capital Leases are determined by one of the following four criteria;
1) The lease transfers ownership of the property to the lessee by, or at, the end of the lease term; 2) The
lease contains an option to purchase the leased property at a bargain price; 3) The lease is equal to or
greater lhan 75o/o of the estimated economic life of the leased property; 4) The present value of rental
and other minimum lease payments, excluding that portion representing executory costs to be paid by
the lessor, equals or exceeds 90% of the fair value of the lease property.
The cost of normal maintenance and repairs that do not add to the value of the asset or materially
extend assets lives are not capitalized.
Major outlays for capital assets and improvements are capitalized as projects are constructed.
lnterest incurred during the construction phase of the capital assets of business-type activities is included
as part of the capitalized value of the assets constructed.
Property, plant, and equipment of the primary government are depreciated using the straight,line
method over the following estimated useful lives:
Assets Years
Buildinqs & lmprovements 5-60
lmprovements other than Buildinqs 5-50
Machinery & Equipment 3-20
Roads, Guardrails & Traffic Siqnals 20
Bridqes 51
Time and Attendance
Kittitas County uses an electronic time and attendance system to track employee's time.
Employees who allocate their time are required to post their time by project or by project time distribution.
This allows the time costs to be charged to the specific project.
Travel Reimbursements
Kittitas County's travel policy for 2020 followed the Federal Guidelines for employee
reimbursement of travelcosts. Kittitas County uses the High-Low cost of travel reimbursement.
MEALS
Meals are reimbursed as follows:
You nrusl lre trgvelino awav frorn home
svemicht to receive mesl reirnttuf,senrent {lRS
recuirementl
Breakfast
Lunch
Dinner
TOTAL
$11.00 - $13.00.
${6.00 - $19.00-
$33.00 - $39.00-
$60.00 - $71.00-
"High Cost areff established King Countlt
Mileage Reimbursement
Mileage Rate is 58.0 cents per mile for the use
of your personal vehicle.
INDIRECT FUNCTIONS
Auditor - Accountinq
The Accounting Division is responsible for the Budgeting, Auditing and Accounting for the county.
The totalAuditor'sAccounting Division 2021 aclual expenses were $951,998. The accounting division
audits the vouchers and payrolls and processes the warrants for the junior taxing districts. The allocation
forthe amount of time the accounting division spends on the other districtsis4.l2o/o of the total hours.
The amount of salaries, benefits and supplies allocated, $913,91 8, as an indirect cost is g6%. All other
operating expenses were allocated at 100% except for penalties and fines which are not allowed. The
amounts of excludable and unallowable costs are $38,030, which includes salaries reimbursed by other
funding sources.
Department Costs
Depreciation Epense
Excluded Costs
Unallowable Costs
Total lndirect Gosts
951,998
(38,080)
913,918
I nformation Tech noloov (Services)
lnformation Technology is responsible for maintaining the county computer equipment and
software for all departments. Tolal 2021 actual expenses for lnformation Technology were $1,443,628
plus depreciation of $156,427 . Capital outlay and sofiware/subscription costs of $533,723 are excluded.
Department Costs
Depreciation Epense
Excluded Costs
Unallowable Costs
Total lndirect Costs 1,066,332
Human Resource
The Human Resource Department administers various programs involving recruitment,
compensation, benefits, collective bargaining, and personnel policy. The 2021 actual expenses are
$371,636. There were no additional, excluded, or unallowable costs.
DEPARTMENTS THAT PROVIDE DIRECT SERVICES
Auditor- Administration
The Auditor is responsible for five sub-departments (Accounting, Recording, Vehicle Licensing,
Elections and Voter Registration) with a total of thirteen employees:. During 2021 the accounting staff
had six full time employees and one intern. The County Auditor dedicates an estimated 2Oo/o of his time
to Accounting functions, and these related costs of $30,000 are reflected as additional indirect costs.
Facilities Maintenance
The facilities maintenance 2020 expenses for the Courthouse were $470,395, plus depreciation
of capitalized expenses on the building and equipment of $77,442. The total included allowable costs
are divided by the square footage of the Courthouse building (73,707) to arrive at a cost per square foot
of $7.57. This cost is then pro-rated to departments based on their occupancy. Costs for lndirect service
departments are calculated as $40,000.
Non-Departmental
This department's expense for 2020 is $1,449,286. lncluded costs from this department include
payments for the state auditor and dues for a total of $108,566. The 2021 state auditor costs were
$83,027. The audit was for the Single and Financial Audit and the Accountability Audit. The dues that
affect all departments; WSAC, WACO, NACO and state purchasing are 925,539.
1,443,628
156,427
(533,723)
Treasurer
The County Treasurer is responsible for the collection of the taxes, receipting of all money from all
departments/funds, investments, and the redemption of all county warrants. As of year-end 2021, 52o/o
of treasury funds were held on behalf of Special Purpose districts. This percentage is applied to Treasury
Department personnel costs to arrive at excluded costs of $158,817. The total expenses for 2021were
$588,190. The total amount of allowable included costs for the Treasurer is $429,373.
GENERAL COSTS OF GOVERNMENT
Under Paragraph 200.444 of Uniform Administration Requirements, Cost Principles and Audit
Requirements for Federal Awards the general costs of government are unallowable. The following
unallowable costs include:
. Salaries and expenses of the Board of County Commissioners,. Cost of the judicial branch of government. Cost of prosecutorial activities unless treated as a direct cost to a specific program if authorized
by statues or regulation. Cost of other general types of government services normally provided to the public such as fire
and police
ATTACHMENTS (3)
o lndirect Cost Allocation (Simplified Method) work papers
o Resolution Adopting Central Services Simplified lndirect Cost Allocation Plan for Budget Year
2023
. Cost Allocation Certificate
Kittitas co u nty central ""#53,rr'J : ffi:ts"rt: At I ocati o n (s i m pt if i ed M eth od)3,062,990lndirect Cost Rate =Adopted Rate =22,3/,0,162lndirect Cost Rate Computation:lndirect Costs divided byDirect Salaries & Waglndirect Functions that ProvideServices to the Service Providing UnitsaTotal Costs12-31-2021Unallo$/ableCosts13.71%TBDfDirectSalaries/WagesAll OtherDirecl CoslsdelndirectCostsa+b+c+d001 1001700200038951,9981,443,6280371,636bcAdditional Costs Exduded Costsie Depr, Rev(38,080)(s33,723)000913,9181,066,3320371,636Auditorlnformation TechnologyCommunicationsHuman ResourceAccountinglnformation TechnologyPostage Machiner'Cb Elum LirHuman ResourcesTotal lndirect Services156,4272,767,2621#,4i27 (571,80310 2,351,886See Accompanying Nandive1o'4
Kittitas County Central Services lndirect Cost Allocation (Simplified Method)Effective January 1, 2023Departments that Proyide Direct Servicesto the Citizens ofthe CountyaTotal Costs12-31,2021bcAdditional Costs Excluded Costsie Depr, Rev(692,658)dUnallowableCostselndirectCostsDirec{SalariesM/agesAll OtherDirect Costsa+Ff001 0001 1o01200130015001600t80019002100220023oo240025AssessorAuditorBoard EqualizationFire MarshalCounty ClerkCommissionersCooperative ExtensionDisability BoardJudge - Superior CourtJuvenileLaw LibraryLower District CourtFaciliiites MaintenanceAssessorAuditor (excl accounting)Board EqualizationFire MarshalCounty ClerkCommissionersWSU ExtensionDisability BoardJudge - Superior CourtJuvenileLaw LibraryLower Districl CourtFacilities Maintenance AdrI1,369,214865,82327,606276,821508,1 54766,370201,24222,755963,888596,8169,5521,124,4731,183,630173,165922,941450,70821,529179,684338,562476,703108,93516,296340,764373,7383,790675,327328,708446,273415,1 156,07797,137169,592289,66792,3076,459623j23223,O785,762449,146854,922See Accompanying Nanative2of 4
Kittitas County Central Services lndirect Cost Allocation (Simplifiect Methoct)Effective January 1, 2023Departsnents that Provide Direct Servicesto the Citizens ofthe CountyaTotal Costs12-31-2021bcAdditional Costs Excluded Costsie Depr, Rev(158,817)dUnallo/vableCostselndirectCosts,|DirectSalariesMages124,66'l203,8561,426,9215,604,214326,340408,53541.307284,57313,60811,583459,464145,50026,6223,124,868116,4451,411,132All OtherDirect Costsa+bf1,324,625301 ,591619,1794,451,006261,850239,43447,938163,500171,23347,244499,12779,8192,781518171,3580026002700290030003100320033003400360037004000390043o0440045004600470060109101103105106107108110112't't 3114115116Non-Departmental Non-DepartmentalCoroner CoronerProsecutor ProsecutorAdminSheriff SheriffTreasurer TreasurerUpper District Court Upper Districi CourtPest Control Pest ControlConference of Governmenl Conference of GovernmenlLibraryAdvisoryBoard LibraryAdvisoryBoardEmergenryManagement EmergencyManagementCriminal Justice Criminal JusticeAdmissions Tax Admissions TaxDedaration of Emergency Declaration of EmergencyPost Employment Benefits Post Employment BenefitsHistorical Document Progft Historical Document PrognCurrent Use Current UseNorth Mobile Home Park North Mobile Home ParkComputerReplacement ComputerReplacementEvent Center Event CenterAirport AirportYouth Amatuer Sports Actir Youth Amatuer Sports ActirCommunity Services Mental HealthCouniy Road County RoadFlood Control Flood ControlPublic Facilities Public FacilitiesEIS Trust EIS TrustLow lncome Housing Low lncome HousingRecreation RecreationHomelessnessHousing HomelessnessHousingTrial Court lmprovements Trial Couri lmprovementsPublic Health Public Health1,M9,286505,4472,046,10010,055,220588, 1 90647,96947,9380163,500212,54047,2440783,70079,81916,389518182,9412,097,297848,0935,5001,497,43015,191,7143,975,407637,965974616,271490,59956,4542,440,2011 08,566429,3731,637,833702,5935,5001,470,80812,066,8463,858,962637,965974616,271490,59956,4541,029,069See Accompanying Nanative3ott 4
Kittitas County Central Services lndirect Cost Ailocation (Simptified Method)Eftective January 1, 2023Departments that Provide Direct Servicesto the Citizens ofthe CountyaTotal Costs12-31-2021bcAdditional Costs Excluded Costsie Depr, Rev156,427(8sr,47s)(1,423,2781elndireclCosls0 711,1040 3,062,990dUnallowableCosts1171181191201221221231251271301311U135140142202301309401402403s015045tI517601622Construciion Performance Construction performanceVeteransAssistance VeteransAssistance911 Excise 911 Excise3/10ths 3/10thsTreasurers lnvestment Rev Treasurers lnvestment RevTreasurers M&O Treasurers M&ONoious Weed Noxious WeedAuditor Centenial Doc Auditor Centenial DocMisdemeanant Probation Misdemeanant ProbationProsecutor Victim Witness Prosecutor Victim WitnessDrug Enforcement Drug EnforcementPublic Defense Public DefenseForfeited Drug Proceeds Forfeited Drug ProceedsHotel Motel Hotel MotelReal Estate Excise Tax Tet Real Estate Excise Tax Te(Debt Funds Debt FundsCapitallmprovements CapitallmprovementsRodeo Grounds Capital lmlRodeo Grounds Capital lmlSolid Waste Solid WasteCommunity Developmeni S Community Development SWater Mitigaiion Water MitigaiionER&R ER&RDental Self lnsurance Prog Denlal Self lnsurance progUnemployment UnemploymentComputer Replacement lnt CRISJerry Williams Library Trusl Jerry Williams Library TruslPrivate Water Trust Prlvate Water TrustTotal Direct ServicesTOTAL023,344687,5262,005,75857,30183,034414,2300692,1 391 61,99510,00088,6544,372707,3960'1 ,757,6160Direc'tSalariesi/Wages1601,1 80,59435,95653,658216,772457,600102,472639,9291,094,60090,589499,5582234iJj6222,340,162All OtherDirecl Costsa+b-f23Ja4687,526825,16421,34529,376'197,458234,53959,523'10,00088,6544,372706,4371,757,6164,606,4791,140,964(2,354,178)1,758,21434,399156,42744,020,424,020,4029595,246,4082,235,564(2,263,589)2,257,772034,399156,4270066,360,56469,127,826See Accompanying Narative4of4