Policy Chapters and Sections

Obligation Extraction

Chapter: 8 Section: 3.3.3
Effective Date: 4/13/2017
Expiration Date: Continuing
Published Date: 8/17/2021 4:26:45 PM
Status: Current
Version: 5

Tags: Reallocation, Allocation, Obligations, Grants, Administration, Fiscal

The Department will extract the obligations reported on Screen 377, by funding stream by local area, for WIOA on July 31st for the prior program year. 

  1. Those local areas that have not obligated at least eighty percent (80%) of a funding stream will be reallocated by the amount those obligations are less than eighty percent (80%) of that funding stream allotment, less any amounts reserved for administration. 
  2. Adult and dislocated worker allotments include funds transferred between them. 
  3. Any decrease or increase in allotments due to reallocation will occur in the following program year’s grant.
  4. Following are examples of the utilization of this reporting requirement:

    Example #1:

    A local area enters into a contract for youth services that begins 10/1/09 and ends at 9/30/10, for $100,000.  As of 6/30/10, the total accrued expenditures for this contract are $65,000, so the remaining balance of $35,000 is to be recognized as an obligation.  On June 30, the entity posts $35,000 on Screen 377 as an obligation.  On 7/15/10 an invoice is received from that contractor for $20,000 for the period ending 06/30/10. The entity posts an additional $20,000 as an accrued expenditure and changes the amount of the obligations from $35,000 to $15,000 on Screen 377.

    Example #2:

    A local area enters into an ITA for $10,000 for a two (2)-year college training program on 8/15/16.  On 8/16/16, the entity reports an obligation for the cost of classes the participant is enrolled in for the most recent semester/quarter.  On 10/15/16 the participant is still in school and the entity is obligated to pay the first (1st) quarter of tuition.  The entity reports an accrual for the amount of tuition it is obligated to pay and reduces the obligation. In December, the participant enrolls in classes for the spring semester/quarter. The entity then reports an obligation for the cost of classes the participant is enrolled in for the spring semester/quarter. Note:  Per TEGL 28-10, the entity is only allowed to report obligations for the portion of the ITA for which the participant is already enrolled. If a subaward or service provider contract contains a budget line item for ITAs, only the ITAs for which the participants are registered in class can be counted as obligations.

    Example #3

    A local area enters into contracts and grants on a July 1, XX to June 30, XX cycle.  No obligations can be claimed for the period ending June 30, XX, since these agreements have an end date of June 30, XX. Any unexpended balance of these obligations may be claimed as an accrual to the extent benefits are received and can be documented.

WIOA Final Rules, Part 683, Subpart A - Funding and closeout

WIOA Final Rules, Part 683, Subpart E - Pay-for-performance contract strategies

Regional and Local Planning Requirements

USDOL Training and Employment Guidance Letter (TEGL) No. 28-10, Federal Financial Management and Reporting Definitions (May 27, 2011)

2 CFR 2900 Uniform Guidance UNIFORM ADMINISTRATIVE REQUIREMENTS, COST PRINCIPLES, AND AUDIT REQUIREMENTS FOR FEDERAL AWARDS

2 CFR 200 Uniform Guidance UNIFORM ADMINISTRATIVE REQUIREMENTS, COST PRINCIPLES, AND AUDIT REQUIREMENTS FOR FEDERAL AWARDS

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