CFO UpdateOffice of State Budget and Management June 24, 2020

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Agenda

Topic Speaker

1 Economic Update Ed McLenaghan

2 NC Pandemic Recovery Office (NCPRO) Stephanie McGarrah

3 Continuity of Operations (COOP) Allocations Lanier McRee

4 FEMA Public Assistance Kathryn Van Tol

5 Budget Execution Updates Thomas Cheek

6 Reporting Lisa Outlaw

7 Q&A

Economic Update: NC Employment Remains Depressed

• Nearly 13% of North Carolina workers reported being unemployed in April and May

• North Carolina lost an estimated 590,000 private-sector jobs in March and April

• More than 15 of every 100 private-sector jobs

• Roughly half of leisure and hospitality workers laid off

• Private employers added back more than 100,000 jobs in May

• Leisure and hospitality jobs accounted for nearly half of May job gains

• Public-sector jobs fell roughly 5% in May

Economic Update: Retail Sales Bounce Back From April Low

Economic Update: NC General Fund Revenue Update

• Revised consensus revenue forecast:

• $1.64 billion (-6.6%) revenue shortfall in FY 2019-20

• $2.57 billion (-9.9%) shortfall in FY 2020-21

• Update on revenue collections through late June

• OSBM and FRD plan to issue new revised consensus after processing of July individual and corporate returns

NC Pandemic Recovery Office (NCPRO)

• The North Carolina Pandemic Recovery Office (NCPRO):• Is established under Session Law 2020-4 of House Bill 1043• Is authorized for 12 months from the effective date of this act (May 4, 2021)• The Office shall cease to operate upon the expiration of the authorization.• The office oversees and coordinates all Covid-19 stimulus funds administered

by the Governor’s Office

NCPRO Responsibilities

• Oversee and coordinate all COVID-19 funds administered by the

Governor’s Office

• Serve as the point of contact for the State’s pandemic economic

recovery efforts and develop a plan for NC’s recovery

• Provide technical assistance and ensure coordination of federal funds

received by state agencies and local governments

• Ensure proper reporting and accounting of all funds

NCPRO Organizational Chart

Samantha Brennen-LiskoAuditor I

John LeskovecGrant Specialist

VacantAuditor I

VacantAuditor I

VacantAuditor I

VacantAuditor I

Dwayne PattersonDeputy Director/ COO

Stephanie McGarrah Executive Director

Catherine Moga-BryantData Scientist

Emily Lou Owoc Program Support Specialist

Lisa OutlawAudit, Compliance & Data

Analytics Manager

Jamilla HawkinsCommunication Specialist

Andy MacCrackenEducation

Nate HalubkaLocal Government/ NGO

VacantOther Agencies

VacantHealth & Human Services

Lisa FoxAudit, Compliance & Data

Analytics Manager

CRF Continuity of Operations (COOP) Funding

• S.L. 2020-04 (HB 1043): 2020 COVID-19 Recovery Act• Appropriated $70M for COOP

• First allocations distributed in early June based, in part, on expenditures through May 22

• S.L. 2020-32 (SB 836): State Operations/ Increase Federal Funds Use• Amends HB 1043 to increase the COOP appropriation by $300M

• SB 805: Coronavirus Relief Funds/ Create Offsets **Pending**• Requires $645.4M of state expenditures to be transferred to CRF, creating reversions

• CRF cannot be used for revenue replacement

but COVID-19 expenses in receipt-supported

agencies/divisions are allowable expenses.

COOP allocation will be based on expenses submitted via

Smartsheet and COVID-19 identified needs & opportunities

OSBM Smartsheet Reminders

All new COVID-19-related expenses (regardless of CRF eligibility) incurred Mar. 1

– Dec. 30, 2020 that are not budgeted in most recently authorized budget except:

1. Existing payroll expenses for:• Substantially dedicated public health,* public safety,*

health care, human service and other similar employees• Other employees must be both substantially dedicated

and working in a substantially different use• Salary, benefits, and hazard pay for these employees

are an eligible CRF use• Hazard pay for non-substantially dedicated employees

is not an allowable use of CRF

2. FFCRA-compliant State of Emergency Leave

Substantially Dedicated: 50% or more of scheduled hours are dedicated to COVID-19 response.

Only COVID-19 hours are CRF eligible.

* Per US Treasury Guidance, public health & public safety employees are assumed to be substantially dedicated.

Smartsheet vs. Reporting

• Smartsheet will not be used for reporting purposes1. Includes all expense 2. Does not show how you are actually using CRF funds

• Lisa Outlaw, NCPRO Audit Compliance Manager, will cover report at the end of this presentation.

Personal Protective Equipment

Personal Protective Equipment (PPE) via DOA/FEMA Portal

Consolidated Purchasing• Purchase PPE for all state

employees• DOA, DEM, & DHHS

Collaboration• HR Directors assisted in

determining agency needs• DOA to deliver PPE• Benefits:

• Avoids inter-agency competition• Increases bargaining power• Ensures use of trusted vendor

Simplified Reimbursement• Agencies will NOT be invoiced

for these purchases• COOP funds will be used for

FEMA match • Payment coordinated by OSBM,

DEM, DPS

DOA handouts on this program attached to email invite

FEMA-Eligible Expenses

FEMA-Eligible Expenses• All eligible expenses should be submitted

through the FEMA portal

• NCPRO website has info on FEMA eligibility

• Reimbursement:• If do NOT submit to FEMA, COOP reimbursement = 25%• If submit to FEMA, reimbursement = 100% (75% FEMA, 25% COOP)

• DPS administers both FEMA and state match

• Indicate in the Smartsheet if submitting to FEMA• Must avoid double-dipping!

NCPRO FEMA information

Useful Links

NC Pandemic Recovery Office Website

https://www.nc.gov/agencies/ncpro

US Treasury CRF Guidancehttps://home.treasury.gov/system/files/136/Coronavirus-Relief-Fund-Guidance-for-State-Territorial-Local-and-Tribal-Governments.pdf

US Treasury CRF FAQsUpdate 5/28/2020

https://home.treasury.gov/system/files/136/Coronavirus-Relief-Fund-Frequently-Asked-Questions.pdf

OSBM Budget Management Memo

https://files.nc.gov/ncosbm/documents/files/memo2020-04-23_FY-2019-20_Budget_Management_Guidance.pdf

OSBM Close-out Memohttps://files.nc.gov/ncosbm/documents/files/memo20200504_CloseoutGuidance.pdf

OSBM COVID-19 Memohttps://files.nc.gov/ncosbm/documents/files/memo20200514_BudgetProceduresForCOVID-19_Appropriations.pdf

OSBM Agency CRF FAQshttps://files.nc.gov/ncgov/documents/files/FAQ_StateAgency_High_Education_CoronavirusReliefFunds.pdf

NCEM PUBLIC ASSISTANCEFOR COVID-19

Public Assistance Program Overview

Kathryn Van Tol984-218-3559Kathryn.VanTol@ncdps.gov

Willie Mae Cox984-297-5645

WillieMae.Cox@ncdps.gov

Todd Wright919-825-2500

Todd.Wright@ncdps.gov

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COVID-19 Federal Relief Funding Sources

COVID-19 Relief Funding

CARES Act – Other

Programs

CARES Act - CRF

FEMA Cat B

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FEMA Public Assistance Program

Help our citizens Prepare for, Respond to, and Recoverfrom disasters.

Ensure the economic recovery of the affected community to the benefit of the community-at-large.

Building more resilient communities that are better prepared for future events.

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Emergency Protective Measures(FEMA Category B)

Eliminate or lessen immediate threats to lives, public health, or safety;

or

Eliminate or lessen immediate threats of significant additional damage to improved public or private property in a cost-

effective manner.

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FEMA Category B Eligible Expenses

• Management, control and reduction of immediate threats to public health and safety:

• Emergency Operation Center costs

• Training specific to the declared event

• Disinfection of eligible public facilities

• Technical assistance to state, tribal, territorial or local governments on emergency management and control of immediate threats to public health and safety

• Emergency Medical Care/Medical Sheltering

• Household pet sheltering

• Purchase and distribution of food, water, ice,

medicine, and other consumable supplies,

such as PPE and hazardous material suits

• Movement of supplies and persons

• Security and law enforcement

• Communications of general health and safety

information to the public

• Search and rescue to locate and recover

members of the population requiring

assistance

• Force account overtime costs (only overtime)

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Practical Tips for Making Public Assistance Claims

• Start documenting all expenses in detail as soon as possible

• Specifically explain and document why expenses are caused by COVID-19 to differentiate them from regular operating expenses

WORDS MATTERCLEANING versus DISINFECTING

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Which To Use First?• NCPRO has advised CRF recipients to seek FEMA Cat B reimbursement

first for expenses that are eligible under both programs• Because CRF dollars are capped, FEMA reimbursement enables CRF recipients

to maximize CRF funds

• Guidance to seek FEMA reimbursement first is encouraged, not mandatory

• Guidance applies to ALL CRF recipients (state agencies, local governments, universities, community colleges, hospitals, nonprofits, etc.)

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CRF v. FEMA Cat B

Budget Execution: Key Dates

• Carry forward requests due to Budget Execution Analysts

• FY 2020-21 Authority and Sufficient Justification for Budget Revisions

July 1

• OSBM distributes Fines & Forfeitures Cost Collection Memo

July 6

• Agencies ready to close except for Carryforward

Mid-July

• OSBM begins carryforward approval notifications

Week of July 20

CRF Reporting Requirements

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Upload and Download LinksDo not send information via email; send using the secure link provided in your invitation email

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Upload and Download LinksDo not send information via email; send using the secure link provided in your invitation email

Lisa.Outlaw@osbm.nc.gov

Send Email to:

Name of Agency or Institution

Subject: Need Upload and Download Link

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NCPRO Expenditure Reporting Process

Step 1Receive Application from NCPRO

Step 2

Submit Attachments A-1, A-2, D, E, W-9, and Vendor Electronic Payment forms with letters from your bank or a voided check to through secure portal

Step 3NCPRO processes documents, sends back contract for electronic signature

Step 4Sign contract electronically. Executed contract is routed back to NCPRO

Step 5NCPRO transfers funds to Entities

Step 6Submit Proof of Use of funds to NCPRO monthly

Step 7

Submit Attachment F, the final report, Use ALL funds or Return unspent funds by December 30, 2020 to NCPRO

Step 8Comply with NCPRO Audit Requests (before or after 12/30/2020)

STEPS 1- 4 Applicable to Nonprofits

and Hospitals Only

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Agreement Contract & Attachments Do not send information via email; send using the secure link provided in your invitation email

NCPRO Documentation

1) Agreement Contract

2) Attachment A-1 Scope

3) Attachment A-2 Budget

4) Attachment B 09 NCAC 03M

5) Attachment C-1 Status Report

6) Attachment C-2 Proof of Use of Funds

7) Attachment D No tax delinquencies

8) Attachment E FFATA Requirements

9) Attachment F Outcomes and Accomplishments Report

10) Vendor Electronic Payment Form

11) W-9 NC Form

12) Conflict of Interest

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Agreement ContractProvided for your initial review. Recipient to review agreement #, allotted amount, amount advanced

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Agreement NumberProvided for tracking Purposes

Subrecipient

(1) Determines Eligibility

(2) Performance is measured based on program objectives;

(3) Responsible for making decisions about the program;

(4) Responsible for complying with program requirements; and

(5) Uses the CRF funds to carry out a program for a public purpose.

Contractor

(1) Provides the goods and services within normal business operations;

(2) Provides similar goods or services to many different purchasers;

(3) Normally operates in a competitive environment;

(4) Provides goods or services that are necessary to the primary activities of an organization.

(5) Not subject to compliance requirements

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Subrecipient vs. Contractor2 C.F.R. § 200.330 through 200.332 regarding subrecipient monitoring and management

VS.

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• Subrecipients must follow the agreement provisions

• Submit Attachments A-F

• Use assigned agreement numbers to uniquely identify them for tracking purposes.See examples below:

39-01-01 Entity A Attachment C-239-01-02 Entity B Attachment C-239-01-03 Entity C Attachment C-2

Subrecipient Requirement 2 C.F.R. § 200.330 through 200.332 regarding subrecipient monitoring and management

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Attachment C-1Descriptive Summary of how CRF were used, any deliverables, progress against objectives & expected outcomes

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Attachment C-2Monthly report of expenditures for recipients and subrecipients by cost category

Recipient Name or

Subrecipient Name

Employee Expenses(e.g. Payroll and benefits cost for employee that are dedicated to

COVID-19)

ContractedLabor Expenses

Other Service Expenses

(e.g. utilities, telephone, data, lease

related expenses)

Subcontract Expenses (e.g. construction,

maintenance)

Goods Expenses (e.g. supplies,

PPE).

Equipment Expenses

Other Expenses(e.g. related charges not

assigned above and described by

recipient)

Date of Invoice, payroll,

or service,

Employee Nameor

Vendor Name or Contractor

Employee ID Number

orInvoice Number

Employee Titleor

Description of Item Purchased

Required Monthly Hours Worked

orTotal Invoice

Amount

Actual Employee Hours Dedicated to

COVID or

Invoice Quantityor

# of Patients Served

If download from accounting or payroll system, it must be in this format:

Excel Worksheet

.xlsxor

Comma delimited or tab delimited format

.csv

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State Agencies – BD701Monthly report of expenditures for recipients and subrecipients by cost category

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State Agencies – BD701Monthly report of expenditures for recipients and subrecipients by cost category

Run StatementsThe run statement member name is C-U-GL-BD701-CERT-REPORT-RUN000100 OPTION LIBRARY(GLPUBLIC)000200 RUN C-U-GL-BD701-CERT-REPORT ;000300 INTO LIBRARY XXXXXXXX ;000400 VARIABLE PERIOD ;000500 00 ;000600 VARIABLE PRIOR-YEAR-IND ;000700 'N' ;000800 SELECT GL-COMPANY-ID ;000900 ('XXXX' 'XXXX')001000 *SELECT GL-CENTER-ID ;001100 * 'XXXXXXXXXXXX' ;001200 *SELECT GL-INTER-LVL-3-RPT-CENTER-ID ;001300 * 'XXXXXXXXXXXX'

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Budget Procedures for COVID-19 AppropriationsProvided for Information Purposes

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Attachment FGrant Outcomes and Accomplishments Report, submitted as a Final Report

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Questions

Submit Form and Question to:NCPRO@OSBM.NC.GOV

Documents and Presentation Located at

https://ncpro.nc.gov

Question & Answers

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