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Lake Cumberland Area Agency on Aging & Independent Living Policies and Procedure Manual

Section VII Financial Management Page 1

SECTION VII FINANCIAL MANAGEMENT

ADMINISTRATIVECOSTS

Lake Cumberland Area Agency on Aging and Independent Living shall limit payment to contractors for administrative and indirect administrative costs in accordance with prevailing federal and state laws and regulations or contract provisions.

"Administrative Costs" shall pertain to those allowable costs incurred by a contractor or subcontractor in the development and implementation of agency-wide policy and functions as necessary to fulfill the terms and conditions of the contract. Agency-wide administrative costs are those allowable costs, which are not directly chargeable as direct services costs and shall include the following functions:

(1) Agency management;

(2) Personnel management;

(3) Accounting, bookkeeping; and

(4) Auditing and legal services

Agency management costs include all costs related to the planning and administration of area plans on aging at the Area Agency on Aging and Independent Living.

All costs related to the above four (4) functions shall be classified as administrative costs and include, but are not limited to, the following:

(1) Salaries;

(2) Fringe benefits;

(3) Travel;

(4) Space costs and utilities;

(5) Office supplies;

(6) Telecommunications;

(7) Computer and data processing services, equipment, software;

(8) Equipment purchase or leasing;

(9) Costs of governing body, i.e., board of directors; and

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(10) Other costs such as insurance, bonding, advertising, etc

"Direct Costs" shall pertain to those costs that can be identified specifically with, and charged in whole or in part to a particular project, service, program or activity of an organization.

"Indirect Administrative Costs" shall pertain to those costs for administrative activities of an organization, which are not specifically identifiable with a particular project, service, program or activity.

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AREA PLANS

The Lake Cumberland Area Agency on Aging and Independent Living shall prepare and develop, for the ten counties of Adair, Casey, Clinton, Cumberland, Green, McCreary, Pulaski, Taylor, Russell and Wayne, a plan of such duration as determined by the Department for Aging and Independent Living based upon a uniform format for Area Plans, prepared in accordance with all applicable statutory and regulatory requirements, and which advances and is consistent with the mission prescribed for Area Agencies on Aging and Independent Living under Section 306 of the Older Americans Act.

Each Plan shall include at least:

(1) Procedures for delivery, through a comprehensive and coordinated system, of an array of supportive, nutrition and other services as may be prescribed under Federal, State and local programs and policies;

(2) Description of arrangements with local providers to ensure the delivery of these services and identification of the service providers;

(3) Assurances that categorical service allotments will be expended in the manner prescribed by policy of the Department for Aging and Independent Living;

(4) Designation, where feasible, of multipurpose senior centers as community focal points for comprehensive service delivery;

(5) Procedures for establishment and maintenance of information and referral services to assure access to services;

(6) Procedures for ensuring preferential consideration in the provision of services to older individuals with greatest economic or social needs, (with particular attention to low-income older individuals, including low-income minority older individuals, older individuals with limited English proficiency, and older individuals residing in rural areas), in compliance with all Federal and State statutory and regulatory provisions and Department for Aging and Independent Living policy;

(7) Procedures for identifying for each previous fiscal year the number of low-income minority older individuals in the planning and service area and for describing methods used to satisfy their service needs;

(8) Procedures for outreach efforts which assure service access by eligible individuals and which target older individuals residing in rural areas; older individuals with greatest economic need with particular attention to low-income minority individuals; older individuals with greatest social need with particular attention to low-income minority individuals and older individuals residing in rural areas; older individuals with severe disabilities; older individuals with limited English proficiency; older individuals with Alzheimer’s disease and related disorders with neurological and organic brain dysfunction (and the caretakers of such individuals); and older individuals at risk for institutional placement;

(9) Procedures for conducting periodic evaluation of and public hearings on activities carried out under the Area Plan;

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(10) Procedures for providing technical assistance to service providers and focal points and for an annual evaluation of the effectiveness of outreach;

(11) Procedures for receiving the views of service recipients;

(12) Procedures, in compliance with Department for Aging and Independent Living policy, for serving as the advocate and focal point for the elderly within the community;

(13) Procedures, when needed, for the provision by existing organizations of day care for adults and respite for their families;

(14) Procedures for establishing an advisory council as required by Section 306 (1) (6) (D) which states to establish an advisory council consisting of older individuals (including minority individuals and older individuals residing in rural areas) who are participants or who are eligible to participate in programs assisted under this Act, family caregivers of such individuals, representative of older individuals, service providers, representatives of the business community, local elected officials, provider of veterans’ health care (if appropriate), and the general public, to advise continuously the Area Agency on Aging and Independent Living on all matters relating to the development of the area plan, the administration of the plan, and operations conducted under the plan;

(15) Procedures for developing and publishing methods by which services, particularly those identified through State policy as access services, are prioritized;

(16) Procedures for effective and efficient coordination of all programs and services operated or delivered in accordance with all State and Federal statutory and regulatory provisions;

(17) Procedures for facilitating the coordination of community-based long term care services emphasizing the development of client-centered case management;

(18) Procedures for determining the service needs of abused, neglected and exploited older individuals, and for identifying public and private nonprofit entities involved in prevention, identification and treatment of these individuals;

(19) Procedures which facilitate the involvement of long term care providers in coordination of community- based long term care services and for working to ensure community awareness of and involvement in addressing the needs of residents of long term care facilities;

(20) Procedures which facilitate the coordination of access services, as identified by State policy, with community activities which benefit victims of Alzheimer's Disease and the families of such victims;

(21) Procedures which facilitate the coordination of Area Agency funded mental health services with those provided by other community organizations;

(22) Procedures for conducting outreach activities, where feasible, to identify eligible older Native Americans and ensure access to services;

(23) Procedures for compiling and disseminating in the planning and service area enrollment course study information of institutions of higher education specifically related to older individuals;

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(24) Procedures for conducting outreach activities to identify older individuals eligible for Supplemental Security Income, Medicaid and Food Stamp benefits; for informing them of eligibility requirements; and for assisting them in accessing those benefits;

(25) Assurances that any funds received under Parts C, D, E of Title III will be expended in accordance with applicable State and Federal statutory and regulatory provisions and with Department for Aging and Independent Living policy; and

(26) Assurances that, if applicable, operation of the district Ombudsman program will be in accordance with State and Federal statutory and regulatory provisions and with Department for Aging and Independent Living.

The Area Plan shall be subject to amendment by Lake Cumberland Area Agency on Aging and Independent Living upon request of the Department for Aging and Independent Living.

(See also Chapter 1.5, Advocacy; Chapter 1.8, Area Agency Responsibilities; Chapter 1.13, Conflict of Interest; Chapter 1.17, Focal Points; Chapter 1.18, Greatest Economic and Social Need Preference; Chapter 1.28, Public Hearings; Chapter 1.29, Public Participation; Chapter 9.2, Allocations; Chapter 9.15, Coordination)

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CONTRACTS

The Department for Aging and Independent Living shall designate planning and service areas in the State and shall make a contract under approved Area Plan with Lake Cumberland Area Agency (Area Development District) in the ten county planning and service area for building comprehensive systems for older persons throughout the State. Lake Cumberland Area Development District, in turn, shall contract with service providers to perform certain specified functions.

The Secretary of the Cabinet for Health and Family Services, or their designee, is the sole official of the Cabinet authorized to execute and sign contracts for the Cabinet. The Commissioner of the Department for Aging and Independent Living is the sole official authorized to execute and sign Department contracts. The Department for Aging and Independent Living shall make no commitment to any prospective contractor until the required review and approval have been obtained. The Executive Director of Lake Cumberland Area Development District is the sole official authorized to execute and sign contracts for Lake Cumberland Area Development District.

Contracts shall be based on the Kentucky state fiscal year beginning on July 1, of each year and ending on June 30, of the following year. The contract is a legally binding agreement between two (2) parties, which sets forth in writing the terms and conditions under which both parties shall carry out their responsibilities.

Each contract negotiated shall contain at least the following:

(1) A complete detailed description of services to be provided by the contractor;

(2) A complete description of all other responsibilities of the contractor including: records retention, reporting requirements, cost sharing, and compliance with applicable assurances, laws, and regulations;

(3) A complete description of LCADD’s responsibilities and commitments to the contractor including: technical assistance which will be provided and activities which LCADD must perform in order for the contractor to meet its obligations;

(4) A complete description of the basis for reimbursement to the contractor for services rendered including: rates, frequency of billing; invoice requirements; office where invoices are to be submitted; and a budget (when applicable);

(5) Assurances regarding the rights of LCADD personnel or designees; State or Federal officials or auditors; or independent auditors to inspect records and monitor service delivery of the contractor at any time relative to evaluation and audits;

(6) A requirement that the contractor accepts responsibility for any audit exceptions arising from its failure to comply with the terms of the contract including all regulations applicable to Federally funded activities;

(7) Payments by the LCADD to the Second Party shall be conditioned upon receipt of appropriate, accurate, and acceptable invoices, as well as the Second Party’s continued satisfactory performance as determined by the LCADD. Invoices must be submitted by the seventh (7th) day of each month following the month of service to the LCADD AAAIL by the Second Party. Payments shall also be subject to the availability and allocation of local agency or governmental funds, or state or federal funds necessary to finance the performance of the services described in this master agreement.

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(8) A clause that LCADD shall have the right to terminate the contract upon 30 days written notice served on the contractor by registered mail.

Each contract shall address the above requirements and contain any other provisions essential to meet the additional needs or requirements of Lake Cumberland Area Development District. The approved Area Plan shall become a part of the contract.

The agreement shall be reviewed and signed by the Lake Cumberland Executive Director before any other party signs.

Once finalized and signed by all parties, the contract is legally binding and the terms and conditions shall be changed only through formal amendment unless otherwise stated in the contract.

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AUDITS

A Certified Public Accountant shall be engaged by Lake Cumberland Area Development District to make independent audits of the Area Development District's financial and other records for the period for which the contract is in effect.

No audit shall be accepted by the Department for Aging and Independent Living unless prepared in compliance with audit standards promulgated by the Cabinet for Health and Family Services, regardless of acceptance by other state or federal agencies.

Procedure:

(1) The Certified Public Accountant engaged by Lake Cumberland Area Development District shall make an independent audit of the Area Development District's financial and other records for the period for which the contract is in effect, and submit an original of the audit to the Kentucky Department of Local Governments and a copy of such audit to the Cabinet's Department for Aging and Independent Living properly certified by the Certified Public Accountant, not later than 90 days after the end of said period or upon completion of an organization-wide audit conducted in accordance with OMB A-128 and the Single Audit Act of 1984, P~L. 98-

502. The engagement letter between Lake Cumberland Area Development District and its Certified Public Accountant shall contain the following clauses:

(a) The auditor shall, in accordance with generally accepted auditing standards, examine the agency's final expenditure reports as required and issue a report on the examination. Specifically included within the scope of this examination are the following audit procedures.

1. The auditor shall familiarize himself with the agency's approved cost allocation plan as submitted to the Kentucky Department of Local Government (or to the Area Development District if provider agency is a subcontractor of the Area Development District) and verify that the agency used the correct accounting methodology to derive the expenditures present ed on the above-mentioned final expenditure reports;

2. The Audit Report shall contain a supplemental schedule that consolidates all individual subcontractors’ final expenditure reports into a total expenditure report for each major service program (i.e. social services, congregate meals). While the auditor may disclaim an opinion on this supplemental schedule, he should verify its mathematical accuracy;

3. The auditor shall familiarize themselves with applicable requirements as set forth in the Department for Aging and Independent Living’ aging policies, contract requirements, and applicable Federal requirements. Deviations from these requirements, which, in the judgment of the independent auditor, relate to substantive program or financial concerns, shall be furnished directly by the auditor to the Department for Aging and Independent Living.

(2) The Cabinet, Kentucky Auditor of Public Accounts, U.S. Department of Health and Human Services, U.S. General Accounting Office, and other appropriate Federal agencies retain the right to audit and review all of the Area Development District's records and accounts for a period of three (3) years from the date of the last payment received for the contract period, or until audited and audit exceptions are resolved; and

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(3) The final audited fiscal report, reconciled with the audit, shall be submitted not later than ninety (90) days after the ending date of the contract, or upon completion of an organization-wide audit conducted in accordance with OMB A-128 and the Single Audit Act of 1984, P.L. 98-502, or, if termination or cancellation occurs, not later than sixty (60) days after notice of such termination or cancellation. The Cabinet has the right to deny payment for any fiscal report that does not comply with this provision.

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CONTRACTAUDITS

Federally funded programs: Unless otherwise required by enabling legislation, federally funded programs are governed by OMB Circular A-133. Under A-133 an audit will be required if an agency expends more than $750,000 in federal funds in a year.

State funded programs: Under the state guidelines, if the contract agency receive more than $50,000 in state funds it shall conduct an audit of the state funds received, but an audit of the general purpose financial statements is not required. The following programs are state funded programs:

HomeCare

Adult Day/Alzheimer's Respite

Personal Care Attendant

The $50,000 threshold is total funding on any combination of the above programs and not $50,000 in a single program. For example, an agency that receives $35,001 in HomeCare and $25,000 of state funds in Title III would be required to have an audit conducted.

The state does not have any type of audit guide for audits of their programs. The general expectation of the state is that audits will verify amounts earned and compliance with the laws, regulations and contract provisions. In planning and performing the audit, the auditor should follow the guidelines contained in Generally Accepted Government Auditing Standards.

Specific tests or procedures are expected to be performed to verify:

Amounts earned (units provided or reimbursable costs incurred)

Required match provided and composition of match (Program Income, Agency Cash or In-kind Match) is allowable and verifiable.

Program income reported equals the correct amount provided by program participants according to cash receipts.

Program income was expended in the year that it was earned and for allowable purposes.

Audits of state funded programs, for those providers required to undergo an audit, shall be submitted to LCADD AAAIL no later than six months after the end of each contract year.

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CARRYOVERFUNDS

The Department for Aging and Independent Living shall authorize the carryover of Federal funds on a case-by-case basis. Lake Cumberland Area Agency on Aging and Independent Living shall submit a narrative request for permission to carry over Federal funds explaining the reason for a fund surplus and the intended use of such funds.

Unexpended Area Agency administrative funds shall be considered for carryover into the service category from which it originated; these funds shall not carryover for administration.

Under Title III of the Older Americans Act, carryover Federal funds shall be matched with fifteen percent (15%) local funds.

No State General Funds shall be carried over.

Program Income shall be expended in the same year in which it is collected. Program income may not be used as match. Lake Cumberland Area Agency on Aging and Independent Living shall plan, administer and monitor its programs in a manner which assures that funds are utilized in the year in which they are allocated.

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FIDELITYBONDS

Sub-Contractors of Lake Cumberland Area Development District shall have a properly executed Fidelity Bond. A Fidelity Bond is a bond indemnifying the recipient against losses resulting from the fraud or, lack of integrity, honesty or fidelity of one or more employees, officers or other persons holding positions of trust. The bond shall be sufficient to cover maximum sums handled quarterly under the contract with Lake Cumberland Area Development District; the sub-contractor shall provide to Lake Cumberland AAAIL no later than sixty (60) days from the effective date of the contract a properly executed fidelity bond. Any bonds required shall be obtained from companies holding certificates of authority as acceptable sureties. (31 CFR Part 223) A list of these companies is published annually by the Department of the Treasury in its Circular 570 (Title 45 CFR Part 74.17 and Part 74.18).

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RECORDRETENTION

Lake Cumberland Area Development District and Aging sub-contractors shall maintain all records pertaining to the contract (45 CFR Part 74) for a period of not less than three (3) years after all matters pertaining to the contract (i.e., audit, settlement of audit exceptions, disputes) are resolved in accordance with applicable Federal and State laws, regulations and policies.

Record Retention Schedule

Lake Cumberland Area Development District (Area Agency on Aging and Independent Living) and sub-contractors shall maintain all records pertaining to the contract (45 CFR Part 74) for a period of not less than three (3) years after all matters pertaining to the contract (i.e., audit, settlement of audit exceptions, disputes) are resolved in accordance with applicable Federal and State laws, regulations and policies.

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Subcontracts

(1) Lake Cumberland Area Development District may enter into subcontracts only upon receipt of final contract with the Cabinet for Health and Family Services.

(2) Copies of the LCAAAIL contracts or proposed contracts must be submitted with the LCAAAIL area plan or plan revisions for approval by DAIL. Any revisions to the contract must also be submitted for approval.

(3) To conduct activities or services on its behalf, Lake Cumberland Area Development District may enter into subcontracts, and any amendments thereof, with profit-making corporations with prior approval of the Cabinet for Health and Family Services. All recipients of awards shall be incorporated to safeguard the interest of the Cabinet, Lake Cumberland Area Agency on Aging and Independent Living, the recipient of the award itself, the individuals involved in the delivery of services, and the individuals participating in the program, unless award is made to an individual under a personal service contract. Copies of the subcontract must be submitted for approval by DAIL with the LCAAAIL area plan or plan revisions. Any revisions from the original contract must be submitted to DAIL for approval prior to implementation. Awards with profit making corporations must be outlined in the LCAAAIL area plan, submitted to DAIL for approval.

(4) Lake Cumberland Area Development District shall execute a formal subcontract for those activities and services to be conducted by an agency or organization other than the Area Development District. The subcontract shall contain sufficient program and fiscal information to assure that all activities and services under an approved Plan shall be conducted in conformity with the Older Americans Act, Federal or State the regulations, any and all policies and procedures issued by the Administration on Aging and the Cabinet for Health and Family Services. Once a subcontract has been executed by Lake Cumberland Area Development District to carry out a service or activity under an approved plan, such subcontract shall be forwarded within 30 days to the Department for Aging and Independent Living and made part of the approved Area Plan.

(5) If the unit cost rate of a fixed rate subcontract is increased, a subcontract amendment reflecting the increase shall require prior review by Lake Cumberland Area Agency on Aging and Independent Living Advisory Council, approval by Lake Cumberland Area Development District Board and approval of the Department for Aging and Independent Living.

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EQUIPMENT AND INVENTORY CONTROL

Lake Cumberland Area Development District defines equipment as all tangible personal property having a useful life of at least one year and a cost of $500 or more. Equipment records shall be current and shall contain at least the following information:

(1) Description of the item;

(2) Serial number;

(3) Source of funds used to purchase the item;

(4) Federal share (%) of the cost;

(5) Acquisition cost and date;

(6) Unit cost;

(7) Location, use and condition of the equipment and date this equipment was obtained;

(8) Information on the disposition of the item

The AAAIL must have an equipment and insurance policy and procedure. The Policy and Procedure must outline and adhere to all state and federal requirements.

There shall be a system to prevent loss, damage, or theft and adequate maintenance procedures to keep equipment in good condition.

Purchase of equipment with a cost of $500 or more requires prior approval from the Department for Aging and Independent Living.

Equipment, which is replaced, may be traded in, or may be sold and the proceeds applied to the acquisition cost. If equipment with a unit cost of $3,000 or more is to be disposed of, not replaced, the granting agency has the right to require transfer of the equipment and title to an eligible party. If approved by the granting agency, the equipment may be sold with the Federal share of the proceeds applied to the program as program income. If the Federal share is not applied to the program as program income, the Federal share, less selling expenses, shall be returned to the Federal government or an eligible non-Federal party named by the Cabinet's Department for Aging and Independent Living.

The factors used to determine allowable cost are:

(1) Reasonableness - an ordinary and necessary expense

(2) Allocable - cost incurred specifically for the program or a benefit for more than one program and is distributed based on benefit received, or is necessary to the overall operation of the agency.

(3) Generally accepted accounting principles

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(4) Any limitations set forth by the program.

Interest and fund raising expenses are not allowable costs.

Lake Cumberland Area Development District shall transfer all items of equipment and supplies with a value of less than $3,000 to a new provider, if a new provider is selected as a result of competition, or if a contract is terminated by the provider or the Cabinet, and a new provider is secured. Such equipment and supplies shall be transferred to the Cabinet's Department for Aging and Independent Living if no new provider has been secured. In the event of termination of a contract or a selection of a new provider, the transfer shall be made within 30 days from the date of receipt of notice from the Department, such notice to be by Certified Mail, Return Receipt Requested. All other requirements of 45 CFR Part 74, subpart 0, Property, shall be applied.

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INFORMATIONSYSTEMS

In accordance with 45 CFR 1321.17(f) (9), concerning the State Plan, the Department for Aging and Independent Living shall have and employ appropriate procedures for data collection from Lake Cumberland Area Agency on Aging and Independent Living to permit the State to compile and transmit statewide data requested by the Commissioner on Aging in such form as the Commissioner directs on an annual basis. This system will gather a minimum data set from the clients of the various federal and state programs (except for Title – V and SHIP which have their own federal systems). The minimum data set will contain enough information to distinguish one client from another. This data set will allow the state to determine a true unduplicated count of clients across the commonwealth and across all programs.

The Department for Aging and Independent Living shall establish a statewide uniform reporting system to collect and analyze data relating to complaints and conditions in long term care facilities for the purpose of identifying and resolving significant problems, with provision for submission of such data to the agency of the State responsible for licensing or certifying long term care facilities in the State, other State and Federal entities that the Ombudsman determines to be appropriate; the Assistant Secretary; and the National Ombudsman Resource Center established in section 202(a)(21); Section 712(c) (2)) and to the Commissioner on Aging on an annual basis (Older Americans Act Section 307(a)(12)(C)).

Pursuant to 45 CFR 1321.65(a) Lake Cumberland Area Agency on Aging and Independent Living shall assure that providers of services shall provide LCAAAIL in a timely manner with statistical and other information which Lake Cumberland Area Agency on Aging and Independent Living requires in order to meet its planning, coordination, evaluation and reporting requirements established by the State under 45 CFR 1321.13.

Lake Cumberland Area Agencies on Aging and Independent Living shall not request, for the purpose of Older Americans Act reporting, information or data from providers which is not pertinent to services furnished pursuant to the Older Americans Act or a payment made for such services (OAA Section 313(b)) 42 U.S.C. 3030c).

LCAAAIL is solely responsible for the submission of required data including that of any subcontractor, to DAIL. Monthly payments to subcontractors will be held should the subcontractor fail to submit required reports or data correctly and by the due date. All reports and data must be reconciled by LCAAAIL prior to payment.

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PROCUREMENT

Policy: LCADD AAAIL shall adhere to the Procurement Standards as approved by the LCADD Board of Directors. References:

1. 45 CFR Part 92

2. 45 CFR Part 74, Subpart P

3. OMB Circular A-102, A-87

4. LCADD Procurement Guidelines

Procedures:

The following is an overview of LCADD AAAIL procurement procedures for the award of contracts:

1. LCADD AAAIL promotes open and free competition among all qualified organizations available to provide allowable services.

2. LCADD AAAIL will not restrict or eliminate competition by placing unreasonable or unnecessary requirements on potential bidders.

3. (LCADD establishes procurement procedures that take into account the requirements of OMB Circular A- 102 and other applicable federal, state and local requirements. Procedures include: Procurement process

Proposal review and evaluation;

Contract Award;

Affirmative Action standards which encourage contracting with minority-owned, small businesses;

Method for resolving protests, disputes and claims;

Code of conduct;

4. Every effort shall be made by LCADD AAAIL to formally advertise programs and services. However, should LCADD choose to utilize non-competitive negations, LCADD shall clearly document and maintain on file: Only one responsible provider is available, capable and qualified to provide the goods or services;

Competition is determined to be inadequate;

An emergency exists which will cause public harm as a result of the delay caused by following competitive procurement.

If non-competitive negotiations occur, LCADD AAAIL will document the reason for non-competitive negotiations, retain information in the negotiation file indicating only one responsible provider is available, capable and qualified to provide the service; and that by using non-competitive negotiations, open and free competition will not be restricted.

5. LCADD AAAIL shall maintain records sufficient to detail the significant history of the procurement. Records will include:

Rationale for the method of procurement,

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Selection of contract type,

Contractor selection or rejection and the basis for the cost.

Upon request, information pertaining to the procurement history of a contract will be made available to the Department for Aging and Independent Living.

6. Contracts between the Commonwealth of Kentucky, its political subdivisions, or other governments may be exempt from competitive procurement procedures. This provision does not apply to LCADD AAAIL contracting with units of government.

7. Competitive proposals, unless otherwise noted in the procurement instructions, will remain unopened until the time for submittal has elapsed. Proposals shall be returned to LCADD AAAIL to the attention of the Director of Aging and Independent Living. Proposals shall be original, with the appropriate number of copies and necessary forms included to be considered responsive. Facsimile and electronic proposals will not be accepted.

8. Federal Law 45 CFP 92.36 ©(2) prohibits the use of statutorily or administratively imposed in-state or local geographical preferences in the evaluation of bids or proposals; therefore any procurement for services under the federal guideline shall be exempt. Should services paid for by state funds, be part of such procurement, they would also be exempt. If the procurement is for services paid for by state funds only, the process must provide the preference consideration of KRS 492-494. The procurement package must contain the KRS 492-494 language. (LCAAAIL Policies and Procedures Revision Feb 2017)

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REQUEST FORQUALIFICATIONS

Policy: Request for Qualifications (RFQ) may be issued in lieu of Request for Proposals when organizations are required to qualify to conduct services under specific Laws, Regulations or local guidelines.

Procedures:

1. RFQs will be submitted and reviewed in a similar manner as a Request for Proposal, with the exception that cost is not a factor in the initial review.

2. Meeting qualification requirements is a requirement for initial review.

3. The initial specification must clearly outline the requirements to be qualified, services to be delivered and expected outcomes.

4. Awards would be made to the organizations or individuals considered to be the most advantageous to LCADD AAAIL.

5. If LCADD AAAIL is unable to agree on the negotiation price, LCADD AAAIL may reject RFQ or negotiate with other qualified entities.

6. LCADD AAAIL will adhere to its procedures for awarding contracts through the Request for Qualification process.

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COMPETITIVE PROPOSAL REVIEW AND CONTRACT AWARD

Policy: LCADD AAAIL will utilize an equitable, well defined and established evaluation process for all competitive selection processes.

Procedures:

The following procedures will be followed for the review of proposals and award of contracts:

1. Written proposals will be submitted to the Director of Aging and Independent Living. All proposals shall follow the format requested by LCADD AAAIL and include complete responses for consideration of funding. Non-responsive proposals are defined as: Incomplete

Lacking information requested by LCAAAIL

Submission after established deadline

Bidder did not follow format established by LCAAAIL.

2. Proposals will be reviewed for cost reasonableness and affordability through a cost and price analysis. LCAAAIL staff will also review for responsiveness prior to the evaluation process.

3. LCAAAIL staff will review and evaluate each proposal per service/program category. The Evaluation Team will follow the evaluation process and score each application according to the evaluation criteria of the request for proposal or request for qualifications. Information from the Evaluation Team review and discussion, including all scores and overall average, will be shared with the Aging Advisory Council Review Committee.

4. LCAAAIL staff will present proposal summaries and other requested information to the Review Committee, established by the Chair of the Advisory Council. The Review Committee may consider staff recommendations or develop its own recommendation to be submitted to the full Lake Cumberland Aging Advisory Council for consideration. Members of the Review Committee who are employed by, or associated with, organizations submitting proposals for consideration will not take part in the review or consideration of funding for such proposals.

5. The following information will be made available to staff and members of the Review Committee through the proposal submitted by applicants: Effect of proposal on services for the elderly.

Plan and timeline for implementation of services for clients, particularly new or expanded services.

Method for assessing and determining needs of clients to be served.

Coordination with community organizations and funding to support project costs.

Experience of organization in implementing planned services.

Budget, budget narrative and justification for request.

6. The Review Committee will convene to review the information submitted by potential providers or current contractors. Organizations will not be invited to discuss proposals with the members of the Review Committee or staff, unless it becomes necessary to conduct an interview of all responsible applicants to finalize recommendations to be made to the Advisory Council. Review Committee members who are employed by, serve on a committee or board or otherwise have an interest in an organization submitting an application shall not participate in any discussion, interview, vote or decisions that influence the funding of a project.

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7. The Review Committee will report recommendations and/or findings to the full Council at the next Advisory Council meeting or special meeting scheduled at the discretion of the Council Chair. Presentations by applicants will not be permitted, unless it becomes necessary to conduct an interview of all responsible applicants to finalize recommendations to be made to the Advisory Council. The decision to interview applicants will be at the discretion of the Director of Aging & Independent Living Services. Advisory Council members, who are employed by, serve on a committee or board or otherwise have an interest in an organization submitting an application shall not participate in any discussion, interview, vote or decisions that influence the funding of a project.

8. The Advisory Council will provide recommendations for funding and selection of providers to the LCADD Board.

9. Staff, members of the evaluation team and Advisory Council should not contact parties submitting proposals at any time during open procurement. The Director of Aging & Independent Living (or authorized designee) will contact bidding organizations with questions and clarification as needed after review of the proposals. Negotiations may not take place at this point of the competitive procurement process. The Proposal scope of work and budget may not be substantially modified as a result of discussion between staff and bidding organizations. Negotiation may occur by the Director of Aging and Independent Living in a manner that is equitable to all responsible bids.

10. The Board will consider the recommendation by the Council or may introduce and consider a revised recommendation if not satisfied with the recommendation(s) of the Council. A procurement negotiation file will be maintained by LCADD AAAIL detailing the history of the procurement. Source documents will be sufficient to establish the basis for selection or rejection, basis for cost, basis for payment, rationale for method of procurement, and selection of contract type.

Code of Conduct

No elected official, employee, or designated agent of LCADD, shall take part or have an interest in the award of any procurement transaction if a conflict of interest, real or apparent, exists. A conflict of interest occurs when the official, employee or designated agent of LCADD, partners of such individuals, immediate family member, or an organization which employs or intends to employ any of the above has a financial or other interest in any of the competing firms.

No elected official, employee, or designated agent of LCADD shall solicit or accept gratuities, favors or anything of significant monetary value from contractors, potential contractors, subcontractors or potential subcontractors.

Penalties

Any elected official, employee, or designated agent of LCADD who knowingly and deliberately violates the provisions of this code shall be subject to legal action by LCADD without the legal protection of LCADD. Furthermore, such a violation of these procurement standards may be grounds for removal/dismissal by LCADD.

Any contractor, potential contractor, or subcontractor who knowingly and deliberately violates the provisions of these procurement standards may be barred from future transactions with LCADD.

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Protest, Disputes, Claims

Protests, disputes and/or claims regarding procurement, awards, or monitoring shall be resolved in accordance with LCADD/AAAIL’s Grievance procedures and as appropriate, fair hearing procedures. Any complaint with regard to the method of procurement shall be made within ten (10) calendar days from the date that LCAAAIL releases the procurement document.

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CONTRACTAWARD

Policy: Upon award of contracts by the LCADD Board of Directors, a formal contract outlining the terms and conditions for the provision of services, receipt of payment, and reporting will be completed.

Procedures:

1. Contracts will be reviewed and approved by the LCADD Executive Director prior to submission to providers.

2. Contracts will be provided to contractors for review and signature.

3. Contractors will return signed contracts to LCAAAIL Director.

4. Revisions to contracts shall only be made with the knowledge of LCADD Executive Director.

5. Upon signature by all parties, one copy of the executed contract will be provided to both parties and are to be retained for record.

6. Verbal agreements by any party will not be binding.

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CONTRACTAMENDMENTS

Policy: Contract amendments will be necessary if the following occurs:

1. Budget Amendments – a budget amendment is required when: a. There is an increase or decrease in the budget total from that originally specified in the contract;

b. Funds are transferred from one program service to another in excess of 20% of the component service modified, or 10% of the total approved budget, whichever is the less.

c. Funds are transferred from one line item to another in excess of 10% of the total approved budget.

2. Program Amendments - An amendment of service objectives or scope of work is required when: a. There will be more than a 10% differential in the planned number of units, unduplicated persons or other funds approved in the service provision contract;

b. A service is to be added or deleted from the contract;

c. The contractor proposes to change (add, move, delete) any approved site for service provision;

d. The program design is significantly changed;

e. A new or amended State or Federal statute or regulation requires a new provision, or conflicts with any existing plan provision;

f. A U.S. Supreme Court decision changes the interpretation of statute or regulation; or

g. The State Department for Aging and Independent Living or LCADD requires an annual amendment.

On occasion, LCADD may implement a unilateral change or amendment to a contract in the event conditions or requirements change and the modification must be implemented by contractors or vendors. This will be accomplished by notifying the contractor or vendor through an official written letter of the change and the effective date for implementation of the change.

Procedures:

Request for Amendment

1. All requests for amendment shall be submitted in writing to the Executive Director or Director of Aging and Independent Living.

2. The following information shall be included in each request for amendment appropriate to the request: a. Rationale for request and impact the amendment will have on clients;

b. Justification for proposed change. Budget amendments will require detailed budget figures representing the current and proposed budget. Include justification for budget revisions.

c. Number of unduplicated clients to be served for the year for each amended service and total unduplicated client count (including proposed amendment – increases or decreases), number of service units for the year (including proposed amendment)

d. Planned date of implementation.

3. LCAAAIL reserves the right to request additional information prior to submission of requests for further review by the Advisory Council and LCADD Board.

4. The process for approval of contracts will be followed for the provision of amendments.

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MONTHLYBILLING REPORTS

Policy:

All contractors are required to complete data entry of services completed for eligible persons by the 7th day of each month, unless otherwise directed, to complete fiscal and program reporting requirements to LCADD AAAIL.

Procedures:

a. A review of accuracy and completeness will be conducted prior to approval for payment.

b. Monthly billing reports, unless otherwise specified, are generated with data posted in the SAMS data and reporting system. This information represents the units of service delivered in total for each month for all clients.

c. Programs not required to enter data into the SAMS data system shall maintain an accurate account of services delivered to clients.

d. By the 7th day of each month, submit a report certifying the services delivered and number of clients served.

e. A monthly billing report will also represent allowable match to support each program and the amount of funds due from LCADD AAAIL.

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MONTHLY/QUARTERLYREPORTS:

Policy:

Monthly reports are required for all programs. Quarterly reports are required for specific programs (see individual program policies for reporting requirements).

Procedures:

a. Monthly data is required for all programs to document service units delivered, client numbers served, match and program income earned.

b. LCAAAIL staff conduct a review of reports each month to determine provider performance problems and to offer technical assistance or corrective action if determined necessary.

c. In the event data or fiscal information appears to be inaccurate or problems in reporting are noted, LCAAAIL will contact the provider staff prior to approval for payment and to determine if further assistance is needed.

d. LCAAAIL reserves the right to deny or withhold payment due to lack of timeliness, need for clarification or additional information.

e. Match reporting will be included in monthly reports. Accurate supporting documentation to validate the value of match reported shall be available for review by LCAAAIL as requested. Source documents supporting any given transaction (receipts, validation of match, program income, purchase orders, invoices, RFP/RFQ data, and bid materials) will be retained by service providers and made available to LCAAAIL upon request.

f. Documents to validate information reported to LCAAAIL will be retained for a period of not less than 5 years from the expiration date of a contract and available for review by LCAAAIL or other officials in compliance with regulations relevant to specific programs.

g. Quarterly reports, if required, will contain performance and service data for the past quarter and provide cumulative data for the fiscal year.

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MATCHREQUIREMENTS

Policy:

Two types of match are allowable for programs that require match; cash match or in-kind match. To document match, the service provider will report to LCAAAIL at the beginning of each fiscal year the amount of match to be contributed, the source of match (must be a non-federal source) and how the match will be used to support allowable program activities.

All Applicants, both for profit and non-profit, MUST match Title III B, C, D, Homecare and Adult Day funds by a minimum of 15%. Title III E funds must be matched by a minimum 25%. Match may be in-kind, cash or a combination. All Match, whether it is cash or in-kind, must meet the following requirements:

A. It cannot be paid for by Federal Funds.

B. It must be an allowable cost.

C. It must be included in the accounting records and audit.

D. It cannot be used to match any other Federal Funds.

E. Program Income is not an allowable match for Title III Programs, but must be utilized in the program in which it is earned within the same fiscal year and reported.

Documentation must include the dollar amount and source of funds that will be used to match the Federal and State funds requested. This match must be documented and listed on the Resources used for Match Pages in the proposal submitted to LCAAAIL.

Please use the following formula to calculate Match for Title III B, C, D, Homecare and Adult Day:

Fed/State Dollars / 85% = X

Total Budget –X = Required Match

Please use the following formula to calculate match for Title III E:

Fed/State Dollars / 75% = X

Total Budget –X = Required Match

(1) In-Kind Match: is the value of a third party contribution provided through non-federally funded resources to support the cost of allowable program activities within the funded program. Such contributions may include the value of volunteer time, the value of space (non-federally acquired space), and/or the value of materials and supplies used to conduct a program or activity. All in-kind match must be supported through records that validate the value and the service provided. Such records may include: volunteer timesheets and value of hourly rate; value of space using a realtor quote or value of average square footage of space in the general location of the space; description and value of materials and supplies used for the program or service. Information to validate match reported shall be retained by a service provider monthly and provided to LCAAAIL upon request.

(2) Cash Match: is the amount of cash or cash value of a contribution from the Second Party. This type of match does not require that the Second party issue a check or provide cash directly to LCADD AAAIL. This

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cash match requirement may be the cash value of a contribution paid directly by the Second Party on behalf of the program. Supporting documentation may include: staff time records (must validate payment with non-federal sources), value of a percentage of space contributed to a program or service through equitable distribution of the value among other programs or services and the cash value of supplies or materials contributed by the Second Party.

Procedures:

Requirements on Cash and In-Kind Match:

(1) The contributions must be an allowable cost to the program to which it is reported and must benefit the program.

(2) The contribution must be acquired through non-federal sources. In-kind contributions are acquired through a third party. (If any contributions are questionable, a written approval should be obtained.)

(3) The contributions may not be used as match toward other federal programs.

(4) Contributions must be "verifiable from the records of the recipients". The records must show the value and how the value was determined. Volunteer services should be supported by the same written documents as paid personnel.

(5) Volunteer time should be valued at rates consistent with similar work at the recipient’s organization if possible. Otherwise, volunteers’ time should be valued at rates consistent with rates paid by other employers for similar work in the same labor market.

(6) Donated supplies are valued at the market value of the supplies at the time of donations.

(7) Donated equipment or space (where no title transfers) is valued at its fair market value.

(8) Conditional approval of value placed on donated items and time contributed for services is required. (This approval does not mean that the value is fair and reasonable.)

(a) LCAAAIL may require that market value or fair rental value be determined by a certified real property appraisal.

(b) Contributions made by a second or third party will satisfy a matching requirement only if the recipient of the contribution were to pay for the expense, the cost would be allowable under the funded program.

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CONTRIBUTIONS/ DONATIONS/ PROGRAM INCOME

Policy:

For programs administered by LCAAAIL, each person shall be provided with a voluntary opportunity to contribute to the cost of the service. Providers may develop a suggested contribution schedule for services provided under this part. However, the suggested schedule shall not specify that a donation or contribution is required to receive a service. In developing a contribution schedule, the provider shall consider the income range of the older person in the community and the provider’s other sources of income. However, means tests may not be conducted for any service supported with funds authorized under Title III or Title VII of the Older Americans Act, as amended.

The privacy of each older person shall be protected. Confidentiality of contributions from participants shall be assured. Sealed envelopes or a cash box may be used to assure confidentiality. No written acknowledgment of the amount of the contribution made will be provided, except at the request of the donating client. Participants desiring a record of their contributions should be encouraged to use checks when making a contribution. Contributions may also be received from public and community interests and fund raising. Reports on contributions should be given periodically to the elderly to advise them of how their contributions are being used. All program income must be applied to the expansion of programs and services targeted by the contribution during the same period (fiscal year) in which the program income (contribution) is received.

Procedures:

(1) Service Providers of LCAAAIL shall establish appropriate procedures to safeguard and account for all contributions.

(2) Two persons (a participant and a staff person) shall be designated to count the receipts daily and document the amount.

(3) Receipts shall be maintained in a locked box or safe until deposit is made.

(4) Cash receipts shall be recorded and deposited daily when over $25 but in no case are receipts to be maintained un-deposited more than one week.

(5) Adequate precautions shall be taken to prevent theft of cash receipts.

(6) Contributions from individuals, families or other entities shall be encouraged in the state general fund programs (Adult Day Care, HomeCare, KY Caregiver, etc.) and suggested contribution or donation rates may be established; however, pressure shall not be placed upon the client to donate or contribute.

(7) Services shall not be withheld from an otherwise eligible individual based upon his failure to voluntarily contribute to support services.

(8) Participant contributions shall be accounted for according to generally accepted accounting principles. Participant contributions will be reported to the Area Agency on Aging and Independent Living on the Monthly Financial Report.

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LCADD Contact Info

Lake Cumberland Area Development District
P.O. Box 1570
(mailing address)
2384 Lakeway Dr.
(street address)
Russell Springs, KY 42642
Phone: 270-866-4200
Toll Free: 800-264-7093
TDD: 800-648-6056
Fax: 270-866-2044
info@lcadd.org

LCADD Calendar

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