Issuance No: A20
Issuance Date: October 2, 2007
Subject: Program Income Policy
The requirements governing the use of program income are found at 29 CFR 95.25. Program income is defined as the “gross income received by the grantee or subgrantee directly generated by a grant-supported activity, or earned only as a result of the grant agreement during the grant period. .”.
Types of income that are considered program income for federal grants are:
- Fee for Services. – Income from fees charged for services.
- User or Rental Fees – Income from the use or rental of personal property acquired with grant funds.
- Sale of Products – Income from the sale of goods constructed under a grant agreement.
- Revenues in Excess of Expenditures – If a governmental or non-profit organization earns or receives revenue in excess of its costs under a WIOA Title I program, that revenue is to be treated as program income. This provision does not apply to commercial for-profit entities. The requirement applies to all Title I programs (Adult, Youth, Dislocated Workers, Job Corps, Native American, Farm Worker and Veterans programs) 20 CFR 667.200(a)(6).
- Interest Income – Income earned from the interest paid on grant funds.
Handling of Program Income:
There are two ways to handle program income:
- Addition Method – Used to provide additional program services.
- Deduction Method – Used to reduce allowable costs incurred.
WIOA regulations and 29 CRF 95.24(a) specify that program income is to be added to the total grant award and used to provide the same services as the original grant agreement.
The Northwest Workforce Development Board will adhere to the guidelines outlined above as well as provide the following additional requirements for handling program income:
- Any type of activities in which program income will be generated must be approved in advance by the WDB Director.
- Any program income must be tracked separately through the organizations accounting system (both by revenues/expenditures and by appropriate funding bucket) and reported quarterly to the WDB on the Program Income Report, Attachment D of their contract.
- The responsibility for cash handling will lie with the Functional Manager within either the Comprehensive or Non-Comprehensive Career Center.
- Documentation that a background check has been completed and proof of bonding insurance must be provided for the designated Functional Manager handling cash.
- All fees must be paid in full prior to service delivery.
- All cash must be maintained under lock and key.
- All cash must be accounted for by maintaining a daily receipt log as well as copies of any deposit slips. Receipts will also be issued to the individual or entity making payment.
- In may be necessary to generate an invoice prior to service delivery in order for a vendor to have adequate time to process payment.
- Acceptable forms of payment may include: cash, money order or check. No credit card payments will be allowed.
- Specific to the National Career Readiness Certificate (NCRC): Program income generated that is due to the Division of Workforce Development will be forwarded to the WDB, who in turn will forward that amount directly to the State.