--so much for joining today's webinar, CAEP Fiscal Update, with Neil Kelly, with the state CAEP office, as well as myself, Veronica Parker, with CAEP Technical Assistance Project.

Before we get started, I'd like to go over just a few housekeeping items. It's been a while since we have been on a webinar together. So, just to acclimate us with different processes, that would be great.

The PowerPoint is available for download in the resources pod. The PowerPoint was sent out to everyone who was registered yesterday as of 3:30 PM. However, if you did not receive the PowerPoint presentation, or you would like to download it again, it is available to you. So please, just select the file titled "CAEP Fiscal Update," and with today's date and "final," and that will provide you with the same PowerPoint that everyone else received yesterday afternoon.

You can use it to follow along, to jot down notes, to write down any questions you may have that you would like to add, or however you would like to use it. You can also send it to other participants who were unable to make it to today's webinar.

If you have any questions, please be sure to post them in the chat pod. Either myself or Neil will address your questions as time is permitted or when there is an organic pause in the webinar. If we do not get to your question immediately, please be patient, and we will get to your question as soon as we are able to. But we will try to answer everyone's questions before we log off this afternoon.

The webinar is being recorded and will be available on the California Adult Education website later on this afternoon, so I'll be sure to post the URL exactly where the PowerPoint presentation, as well as the recording for today's webinar, will be located on the website. Again, if you need to reference any information that was presented this afternoon, or if you would like to send the recording or the PowerPoint presentation to a colleague who was unable to make it, you are able to do so later on this afternoon.

Now, if you are having any sound difficulties, please be sure to let us know via the chat pod. We are a little short-staffed when it comes to technical assistance this afternoon. However, we will get to you as soon as we are able to, via a private chat. And how that would work is, at the bottom of the chat pod, there will be a yellow-highlighted tab, and it will either be myself who is trying to connect with you, and potentially Holly Clark who is trying to connect with you. So please be sure to check the bottom of the chat pod if you are experiencing any technical difficulties throughout today's webinar.

We will be doing some live demonstration in NOVA. So if you would like to increase the size of your screen to full-screen, you are able to do so by selecting the four outward-facing arrows at the top right-hand corner of the screen. However, when you do so, you will not be able to see or contribute to the chat pod, so please be mindful of that. And if you would like to return into the room, you are able to do so, but the arrows will now be facing inward-- so, four inward-facing arrows-- and that's how you get back to a normal screen.

So please be sure to use that as you see fit so that you can have the best experience this afternoon.

We are taking attendance. And I noticed, from the attendance sheet, there are a number of participants who are logged in and who have used their consortium name, an acronym, or initials. If you'd have done so, please be sure to let us know exactly who you are.

I do see a few people who did let me know who they are and who they are participating in today's webinar with. We greatly appreciate that. It makes taking attendance easier, and we are able to identify who our audience is. So if you have not done so, and you are logged in, participating with multiple people, please be sure to let us know so that we can account for everyone via our attendance record.

So that's all I have for you as of right now. If you do have any questions, please be sure to type them in the chat pod, and we will get to them as soon as possible. If you're experiencing any technical difficulties, please be sure to type that in the chat pod, and we'll get to you as soon as we are able to. And if you would like to download today's webinar PowerPoint, you are able to do so by downloading it in the resource pod.

I will turn it over to Neil, who will get us started. Neil?

All right. Thanks, Veronica. Welcome, everybody. I think this is our first webinar of the year since March. And usually, we have a lot more of these. I think we had 170 people signed up.

So, if you look at the agenda, we're going to talk about the exciting stuff in the middle so those people that are coming on late won't miss out. But, just to review the agenda, we'll go over the quarterly expenditure process, the closing out of '17-'18 funds, and then we'll shift gears and talk about the allocations for '20-'21, talk about the COLA, and then the CFAD submission. We'll also talk about the allocation amendment process, NOVA basics and reminders, and then, with extra time, we can answer all your questions.

Veronica is going to be doing demos. You guys have screenshots for the CFAD, which she has demos for other things. So, for those of you who aren't too familiar with NOVA or who haven't done it for a while, this can walk you through those steps as well. And I'll take care of the policy-type question.

So, if you do have questions while Veronica's doing the demo, I can probably catch up in the chat. So make sure you put those questions in the chat, and I can respond to them either verbally or catch up during the demo. So let's move forward.

12:08. We are going to go to 1:30, so we do have plenty of time. So we will try to get to everyone's questions. And let's go.

OK. So, first thing we want to talk about is just the general quarterly expenditure process. And we do have a lot of turnover at the consortium level as well as at the member level, so we're always onboarding new NOVA users and new people at CAEP as well. So, quarterly expenditures are due, and we have a schedule of that. So quarter 2 was due March 1 by the members and certified by March 31 by the consortium.

So, we always like to reiterate that the district Accounting office-- when you submit your quarterly expenditure report, we assume that that has been reviewed and approved prior to submission by your business office or your district accounting office, because the consortia-level review does not look at your purchase orders, your time sheets, your encumbrances, whatever. They look at it at the level of, OK, does this align with our three-year plan? Does this align with the annual plan that the members submitted? Does this align with the member-approved budget that we approved earlier in the year?

So that consortia-level review is more in the planning, big-picture budget look, where the specific expenditure report-- that has to be approved before you submit by your accounting office. Sometimes, the accounting office will submit it into NOVA, but I just want to make sure there's a clear distinction. We do not want consortia directors asking you for purchase orders and time sheets and stuff like that. That's not their role.

And then, also, remember, annual plans and budgets have to be certified before submitting any quarterly expenditure report. So if you're trying to submit quarter 2, and you never submitted quarter 1, or the consortia never certified your annual plan or budget, then, obviously, you won't be able to submit any quarterly expenditure report.

So the way the process works is, you have that annual plan. You've submitted in August. Then, you develop your budget. Then, that's certified by the consortia. And then, once your plan and budget is certified by your consortia and its membership, then you can start doing your quarterly reporting.

So that's something to remember. A lot of people forget about that. And they call us, and they say, why can't I submit my report? Well, because some of your members haven't submitted their report from Q1. So just keep that in mind.

So, let's see if I have any questions about quarterly expenditure reporting. I think I have a frequently asked question here, so let's go through this one. We get a question that says, I have input my member expenses into NOVA, but it won't let me submit.

So, we would caution you to check to see if all members have submitted their expense reports in the prior quarter and if the consortia has certified these reports. Remember, you can't move into next quarter unless the prior quarter is certified, so that's always something good to note.

And then, another question we get is, NOVA won't let me submit because my expenditure fell below target. How do I fix that?

So, because NOVA has a forecasting tool and a target-expenditure tool, the member can submit a corrective action plan in NOVA stating how they will meet expenditure targets, if that's what you want to do. If you do have targets in there, then you'd have to explain why you're not meeting. So it's all about how you set that up and how you set up your targets and stuff like that.

So that's another tool you can use, but some people get caught up in that, not realizing that they put their targets in, and now they're being helpful. But those are self-imposed targets. The state doesn't go in and mandate what your targets should be. That's really upon you, when you're in NOVA, to put those targets in. We have some guidance and guidelines on target spending to get you to spend this money down, but really, you have to put those numbers into NOVA.

Fine. OK. So, I'm going to turn it over to Veronica. She's going to walk you through this, and I'll look at the chat to see if there's any questions. Go ahead, Veronica.

Thank you, Neil. So, I will stop sharing this screen and will begin sharing my screen in NOVA. Again, if you would like to access the full view, you are able to do so by pressing the forward, outward-facing arrows. One second.

OK. Neil, are you able to see NOVA?

Yes.

OK, great. So, I am in NOVA, and we are getting ready to submit our quarter 2 expenditure reports. So here, for example, today, we're using the Allan Hancock College consortium, and I'm going to be looking at Lompoc Unified. They have not submitted their quarter 2 expenditures as of yet, so I will use them as an example, since their information is currently open.

Before I submit the quarter 2 expenditure reports, I always want to make sure that I check quarter 1 for two reasons-- A, to see if there are any revisions that need to be made. We understand that, sometimes, there are reconciliations that take place in between quarters, but the reconciliation may take place after quarter 1 has been submitted. So that we don't get into any trouble at the end of the quarter, if there are any revisions that need to be made, we would advise that you make them in the quarter that they need to be made before we close out the end of the year, because once we close out the end of the year, we can't go back and access previous expenditure reports.

The second reason I would look at quarter 1 is because NOVA operates on a year-to-date system, and so your year-to-date expenditures will be cumulative in Q2. So you want to make sure that you add your Q2 expenditures to Q1, and NOVA does not do that for you. So that's a manual add.

So, now we'll go to Q2 to begin entering my expenditures. Again, this is phony data. This isn't real. I'm in a window where I'm not changing any of their information. I'm just playing with it. And also, I would like to note that the information that you are seeing presented now is different from what's in the PowerPoint. So if you're following along via the PowerPoint, and it's looking different, it's because the numbers are different. However, the process is the same.

So, for quarter 2, I'm just going to add arbitrary numbers. So you would click into your cell for the object codes. So, for instructional salaries, quarter 1 was $224,000, $287,000. In this quarter, the instructional salaries will increase by $50,000. So all I would do is select the $224,000, and I will add $50,000 to this.

So that will end up being $274,000. So $274,000, $287,000. For noninstructional salaries, I didn't have any changes this quarter, so I'm going to leave that number the way it is.

Employee benefits. This number has increased to $30,000 so I will change the $87,059, and that will now be $107,059. And then, supplies and materials-- we only purchased $2,000 worth of supplies of materials, so this number will now be $77,000.

And then, other operating expenses and services. We had $10,000 for this object code, so I'm going to add that. And then, we didn't have any capital outlay, any other outgoing expenditures. However, our indirect costs rose to $30,999, so I'll change this number here.

So, all of my numbers have changed. The total amount-- now, NOVA has calculated my year-to-date expenditures and has given me the total. And it's also changing my year-to-date forecast of the project budget in the amount that I am now at for the forecast.

Underneath here, because I have met all of my forecasted expenditures for quarter 2, I do not have to complete a corrective action plan. However, if I didn't meet my target for quarter 2 underneath the table for your expenditures, you would now see a corrective action plan. NOVA does not allow you to move forward until something is in the corrective action plan.

As Neil stated before, the state does not review the corrective action plan at this time. It's for you and your consortium so that you all are aware that the expenditure targets are not being met. And so it is going to ask you for an explanation as to why the expenditures are not met at that time. So you would briefly describe what happened and what you plan to do, moving forward, so that you are able to meet your expenditure targets.

The summary of the activities this table should be used to describe what activities took place during that quarter. And then, if there are any changes that have to be made in your revisions that have to be completed, or if there were any unique situations that took place, and you would like to capture this information for future reference, you would put that into the summary of the activities. Once you have completed all of this information, you would scroll down, and you would select Submit. And then, once you select Submit, then another screen will appear.

And I will turn it back over to Neil, who will continue on with the presentation, and then I'll go over the closing out '17-'18. In the next segment. So I'm going to go back to the PowerPoint.

So, Veronica, I'm going to put you on the spot. We got a few questions while you were talking. So, when you're ready, I can throw them at you. Let me know when you're ready.

OK. One second. All right. I'm ready.

All right. There we go. All right, so the first question was from Kristen in Salinas Valley. She was talking about a NOVA fix related to-- let me just find her. It says, Veronica is working on the issue with Q1 numbers changing. Do you remember that issue that Kristen brought to your attention?

Yes, I do. And Kristen, we can talk offline. It was a unique situation for her consortium.

OK. So, then, Shannon from Siskiyou Adult Ed Pathways, says, can the programmers change Q2, Q3, Q4 to not autopopulate to the next quarter? I know it's a process, but it seems like it may be easier for inputting correct year-to-date numbers.

I don't know the answer to that. That's a developmental question, and that's something that we would have to talk to the programmers about to see if that's possible.

OK, so we could put that on our list?

Mm-hmm.

And then, Jody asks, when submitting quarterly expenditures, is it required for members to complete the Summary of Activity section when consortia has a local process for reporting activity?

So, in order to submit the quarterly report, that section does have to be completed. So it could just be a brief description of the summary of activities. Or, like I said before, if you would like to reference any information in the future, you'll have it documented with that quarterly expenditure report.

Right. I think that's similar to Kelly's question, because what kind of detail in CAEP is needed. And, like you said, a brief description, something minimal, because it won't let you submit unless you have something in that section, correct?

Yes.

OK. And then, Parul from Yosemite also concurs with what Shannon was talking about, so we can ask the programmers about that. OK.

Oh, so Kelly says, in the corrective action plan, what are we supposed to write? And I would say, Kelly, it's just enough to say how you're going forward. It doesn't have to be a long litany of things you're doing, but just enough to let your members know, and for historical purposes, how you're working with that.

So it's not up for state review, but it does create a little historical record. So you can use that as something to remind you down the road or remind your members what you guys are working through. But it doesn't have to be extensive.

And then, Jody said, my members have already submitted their Q2 and did not complete the summary. Do we have to unsubmit and add a summary. Does that have to do with when you certify, or is that just for submission?

It's supposed to be for submission. But let me look into that, because I thought that you had to complete that section in order to submit. But I'll check into that, Jody. Thank you for bringing that to our attention.

OK. So I'm going to move on. Thank you for your questions. After a few slides, we'll take a few questions, but we don't want to lose the momentum, so we're going to move on.

OK, so let's see. This slide is the quarterly expenditure process. And Veronica, this is along Kelly's question. Did you want to talk about the corrective action plan? And this is displaying that question of, if you get to the point where your expenditures fall below target, you would have to fill out this form. Is that correct?

Yes, that is correct. So that's the part that I had went over, regarding the corrective action plan. So, in this example, the agency did not meet the targeted expenditures, and so that is a required field, and it asks them to fill that out. And then, they also submitted information about their summary of the activities for that quarter.

So, now that we are at this point, I will go ahead and demonstrate the closeout of 2017-'18. So I'll once again share my screen, so one second.

OK. Now I am back in NOVA. And as we mentioned before, we are showing the corrective action plan as well as the summary of the activities. Now that we have entered in this information and we have also entered in our quarterly expenditures, we've reviewed it. It is correct to the best of our knowledge, so now we are able to submit so that the consortium can eventually certify.

You would do so by submitting the Submit Quarter 2 button. And underneath there, there is a note to let you know that, in this process, you will also be closing out your 2017-'18 monies. So I'm going to hit Submit here, and then I will receive a message. And so, it's basically saying that this is where I am certifying that my expenditure report has been prepared in accordance with the applicable state regulations, and then it has more verbiage.

If you agree, then you agree and submit. If not, and you do need to make some changes, then you are able to cancel the submission process and go back and make the changes that you would like to make. So I'm going to hit Agree on Submit.

And then, this is where you will close out 2017-'18. We have received questions via the TAP inbox about the 2017-'18 closeout. Some members thought that it's a process where you actually enter in expenditure information. However, you do not have to. That information has already been entered into NOVA, and once the monies expire, December 31, all of that information was captured.

So now, it's just saying either A, you still have monies for 2017-'18 that you will be returning to the state, or you are certifying that you do not have any monies. So, this allocation year 2017-'18 closeout box-- it's basically saying, as indicated in the FIFO dashboard, your member agency expenditures reported within NOVA indicate that you have expended all funds for allocation year 2017-'18.

If you did have funds that needed to be returned to the state, it would show you dollar amount. So let's say you still have, for example, $10,000 in 2017-'18 monies that you will now be returning to the state. And then, it's going to say, I'll review the fiscal reports for my agency and confirm that all funds for this allocation year have been spent. You check this box, and then you press Submit. And that is the process for closing out 2017-'18 monies.

Once you have closed this out, your certifying authority-- so, your primary contact, or whomever is the certifying authority for your consortium-- will be alerted that you have submitted your Q2 expenditure report and you have certified that all of your monies have been spent. Or, if you have dollar amount, NOVA will then generate an invoice for you to return monies back to the state general fund.

So that is the process for closing out 2017-'18. I will now go back to the main screen and see if there are any questions. One second.

OK. So, while you're doing that, Dana has a question. Our members are getting a red exclamation mark if the amount spent is less than projected. Is this just for informational, where we are still able to submit?

A red exclamation point? Typically, you only receive that if you have gone over your budgeted line item. So, for example, if your object code 1000-- you budgeted, let's say, $50,000 for the entire year, but at quarter 2 you have reported $75,000 for object code 1000, then you should have a negative number and an exclamation point. Is that what you're seeing, Dana?

So, Veronica, if that's the case, then they would just have to go in and update their budget to reflect the--

Correct. Yes. NOVA will still allow you to submit even though you have that exclamation point. However, we strongly advise that you complete a budget revision. We've had multiple consortia and agencies who have done that. And then, years later, they find out that they had overspent, ad their expenditure reports didn't match, and so we had to do a lot of reconciliation. So, if you do have the exclamation point, and you have gone over budget, please complete a budget revision prior to submitting the quarter 2 expenditure report.

Right. And Lourdes says, caution. At the end of the year, Q4, it won't let you submit if you're over budget. So thank you for that one, Lourdes.

And then, Dana says, do they have to revise the budget if the bottom line is OK? I think you could still submit it, but it's probably good practice not to get in that habit because, at the year end, you will run into problems--

Yes, absolutely.

--and then you'd be over budget.

What is the state going to do if the funds are returned? We put it in the general fund, and it goes with all the other general fund money. It does not go back to any Adult Ed consortia. It does not go back to state CAEP. It goes to the general fund, and then we lose it.

Lourdes also says, you will have to do a budget amendment at year end. Happened to me last year. Thank you.

Can you show us really quick where you can do that in NOVA? OK. Let me just run through the closeout. And Veronica, will you be able to show how to do the budget revision really quick, once I go through these slides?

Yes.

OK. All right. So, just to go over what Veronica just showed you, just a little policy on the closing out of funds. So, if you look at the life of the CAEP dollars, state practice is 30-month shelf life. So it's really 36 months, which is three years. So, in state administrative policy, it's one year to allocate, three years to spend. So the state has one year to get the money out, and you have three years to spend it.

So, when you look at that 30-month shelf life, because I'm taking six months off for the closeout, the 30-month shelf life begins on July 1 of year 1 and ends December 31 of year 3. And then we have that six months of processing to closeout.

So, right now, for '17-'18, we're in the closeout phase. It started in January. It'll run through June. And so, I'll run through what this timetable is.

Back in 2017, July 1, we issued the '17-'18 funds. So year 1 was July 1, 2017, to June 30, 2018. So, those funds we allocated through the 11 installments, starting in August and going through May. The state was late on the K12 fund, so some of you didn't get this probably until December or January, and then we caught up by May.

So, once those 11 installments finally got into your account, usually ramped up your spending in year 2, which was July 1 to June 30, again. And then, what we see is, starting in year 3, most of that money gets spent. And so, by year 3-- and that was 2019-- we see Q1 in NOVA. Most of the '17-'18 funds are spent, and then some stragglers catch up in Q2, which we're reporting right now.

So, Q2-- the activity ceased at the end of December, but we don't report Q2 until March 1. So it gives you an extra two-month cushion to tie up all those purchase orders, encumbrances, things that are outstanding, and then the consortia certifies. And so, I want to just go through that six-month process after the end of the 30-month.

So, January, February-- member begins to close out the process. So, that was the last two months. So, March 1, just last week, or this week, or the weekend. Member certifies that all '17-'18 funds have been spent-- that's what Veronica showed you-- and submits Q2 and signs off.

March 30, the consortia certifies that all these reports are good, and the consortia certifies for that, along with all the members. But then, if we do get any invoices generated, we'll work with that member, because the state is closing our books in April and May. And so, we work with you to remit those funds via the invoice process. We get that back in the general fund. And then, by June, it's the end of the fiscal year.

That's the three-year lifecycle of a CAEP dollar, and so that's why we go through the closeout process. So far, the last few closeout processes, we haven't returned-- well, maybe the first year, I think we returned $3,000. Something like that. But last year, no funds were returned. This year, everybody promised to spend their funds, and then I've already reached out to everybody to make sure that the funds would be spent. So, hopefully, we'll have zero funds returned.

Let's see. Just another reminder-- next slide here is-- members must follow their three-year and annual plan on their approved budget, by the consortium, with spending down funds over the 30-month lifespan. It's a first-in, first-out methodology. See, we spend down the old money first in NOVA before we hit any new money. So we'll continue to liquidate '17-'18 funds until it's all spent.

That's why, when you go into NOVA, and you look at the different years, you're saying, I knew I spent money this year, but it keeps showing it in '17-'18. Well, that's because you haven't spent enough to liquidate '17-'18 and '18-'19. A lot of people have liquidated all their '17-'18 and all their '18-'19, and they're working with current dollars. So that's how NOVA's set up, and you can look at the individual years. But it does do a first-in, first-out.

Carrying over money into the next fiscal year could have consequences. Check your local bylaws, because technically, you have 30 months, but within the consortia, you might have some local bylaws that allow for reallocation of funds within the consortia. And then, like we just said, any remitted '17-'18 funds will be returned to the state general fund.

So, before we have Veronica go through a budget revision, let's see if we have any questions.

"We request quarterly member"-- OK. Kristen says, so, do funds have a 30-month shelf life or a 36-month shelf life? So, it's a 30-month shelf life with six months to close out, so that's two and a half years.

So, year 1 of these funds, for '17-'18-- we issued the funds July 1, 2017. You have the full '17-'18 to spend that. Then you've even got '18-'19 to continue spending that. And then, at the first six months of '19-'20, which would have ended December 31-- that's when the 30-month shelf life ended. So December 31, 2019, would have been the end of '17-'18 funds.

So then, like I said, the next six months are spent closing out. We give you a couple of months to make sure you have liquidated all those '17-'18 funds. And then, this month, you report that into NOVA, like Veronica just showed you. You certify it. Then the consortia certifies it. And then, hopefully, you're not remitting any funds. So, hopefully, that makes sense.

And Mary Ann says, typically, how much money that's returned to the state is then spent in a given year? So, Mary Ann, usually none. Last year, it was none. Two years ago, it was less than $5,000. So we're hoping it's none.

And I did contact all the members that had remaining balances, and their consortia leads and directors assured us that this money would be spent. So we don't like to see you it going in the general fund, because that doesn't help anybody is the consortia. That's why your consortia should have bylaws to reallocate those funds-- so they do get spent down before this recapture phase, or putting it back in the general fund. So, usually, no money's returned, but we've always got to stay on top of that.

So, with that, Veronica, let's see. What's the next slide? So, the next slide-- oh, here's the question on closeout before we turn it over to Veronica. Question is, my member needs more time to finalize their closeout report in NOVA. What do I do?

So our response is, the consortia has until March 31 to certify Q2 and close out. Work with your members to provide them additional time and allow for consortia review and certification within the March 31 deadline.

So you really have this whole month to work through this process. It depends on the consortia, how much time you need, how much time are you willing to give your member if they need extra time. But if you are going to be returning funds to the state, or you think there might be a chance, let us know. Contact TAP. Let us know as soon as you can, and then we'll work with you on that process.

And if there's a timing process, like the member just needs another week to finalize some invoice or something, we'll work with you on that as well. But the best thing to do is contact TAP immediately. Let us know, and then we can set up some dialogue to see what the issue is and work through it with you.

OK. With that, let's turn it over to Veronica. Oh, wait. There's another question. Darn it. OK, another frequently asked question. "My member's accounting office asked if expenditure closeouts include encumbrances rather than expenditures."

And then, our response was, all CAEP activities related to '17-'18 ended on December 31, 2019. The closeout reports must include all confirmed expenditures. We cannot allow for open purchase orders or encumbrances for closeout certification. Please have them contact TAP if they have any questions. So that's how we're closing out funds.

So, Gloria says, EDGAR regulations allow for encumbrances to be included in expenditure amounts. Why is CAEP different? CAEP is state funds. So I would check with your community college accounting office and look at their budget and accounting manual to see how they're reporting those funds.

But when we close them out, they have to be spent. So if you do have an outstanding encumbrance, I would work back through your accounting office at the college. And if they have questions, they can contact us in the Chancellor's office

OK. With that, I think we're ready to have Veronica show us a budget revision. Take it away, Veronica.

Thank you. Thank you, Neil. And my apologies. I did jump the gun just a little bit, and I closed out '17-'18 prior to the point where I was supposed to. But we do have the budget revision question that came up, so I'll definitely show you all what that process looks like now.

I'm going to navigate back to NOVA and share my screen. So I am back in NOVA, and I have opened up the budget and work plan for Allan Hancock College consortium for the Alan Hancock Joint Community College District. What I would do first, once I get to the budget and work plan-- I would ask the primary contact. The primary contact would first uncertify the budget, and then the member representative will be able to go in to make the budget revisions.

So I'm going to select Uncertify, and a message is going to come up that says, "By unsubmitting your budget work plan, you are sending it back to drafts status. The budget work plan must be resubmitted to be eligible for fiscal reporting." And that is definitely true.

Another thing that I would like to point out is, at any point, if the budget and work plan is opened by any member within the consortium, other members who are attempting to complete their expenditure reports-- they will not be able to submit or certify, because the budget and work plan is open. The budget and work plan does have to be closed in order for expenditure reports to be submitted and certified. So, if you are trying to submit as a member representative for another agency, but you do not have the Submit button highlighted, and you've completed all of the expenditures, you've completed a corrective action plan, if applicable, you've entered in your summary of the activities, but it's still not submitted, this could be a reason why-- because the budget and work plan is opened by the consortium.

So you want to make sure that this is back in "certified" status in order to complete your expenditure report. So that's just something to note as you are moving along throughout the process.

So, I'm going to select OK, and this is going to open up the budget and work plan for me to be able to make revisions. So I'm going to first click into the work plan. And although I'm not going to make any changes to the work plan, you still should click into this box so that the system can keep up with what it is that you're trying to do.

If there are no changes, I would select Next to get to the budget, and this is where you would make changes to the budget. So, for example, I use a hypothetical example where my expenditures exceeded the budget for object code 1000 by $25,000. So what I would do here is, I would add $25,000 to object code 1000. So I'm going to use my handy dandy calculator. Too much math to do in my head.

So now my budget amount for object code 1000, by adding the $25,000, will be $259,728. Now that I've added $25,000 to object code 1000, I need to subtract $25,000 from another line item so that the budget can remain balanced. So I'm going to take off $25,000, let's say from supplies and materials. So I'm going to reduce this $144,243 by $25,000.

So that's going to bring me down to $119,243. None of my expenditure targets have changed. I'm still able to meet my expenditure targets in the manner in which I have set forth. So you would just scroll down. Make sure everything is completed as it's supposed to be, and once you've reviewed everything-- as you saw, my remaining balance was $25,000, but I have balanced this, so now my remaining amount is $0.

Once I've reviewed everything , I will now go to Next. And then, go to the Preview screen. Make sure all of my numbers are still in alignment with what I want. And then, I would submit.

Once I submit, this box will appear to see if there are any comments that you would like to add. So, just for record-keeping, I like to make sure I note any changes that I have completed, so I'll type a note for the consortium as well as the consortium lead to let them know that I made the change. So I will put something simple in, like, "went over budget by $25,000 in object code 1000. Reduced supplies and materials by $25,000." Something short and sweet just to document what it is that you have done.

This is not a requirement. It's just for record-keeping, because you never know who needs to access this information at what time. And if information is pertinent for any situations, you want to make sure that you have it recorded. So I'll type in my quick little note I'll press OK.

My consortium lead now knows that I have made this budget revision, so then they can come in, and they can either reject my budget revision-- so, maybe that was incorrect. I should have done it another way, or I should have reduced another object code. So they can reject it anytime. If the consortium lead rejects the budget revision, it will go back into draft status, and the member representative will have to go back and make another change and resubmit.

However, if the consortium lead knows that this information is correct and are OK with it, they are now able to certify that the revision of $25,000 out of object code 1000 into object code 4000 is correct. And so, now, the budget is back in certification status, and member representatives who are completing their expenditure reports are now able to do so, because the budget and work plan is now back in certification status.

So I believe I have answered Kelly's question. I will go back into the PowerPoint and see if there are any other questions or if there is more clarification needed. One second while I do this.

So, Veronica, you did answer Kelly's question about the having to resubmit once you uncertified. That's what you just went through, right?

Yes.

OK. So, then, no other questions. I don't see. But people are typing.

And just to clarify for Gloria at Compton College, when you submit your closeout of expenditures, you're following your accounting policies and procedures. So every accounting office follows they're generally accepted accounting principles, whatever that is, and when they submit that, they're following that. They're subject to audit. I would follow along with what they're allowing you to submit. That's why it's always good to run it by your accounting office prior to submitting.

There's a question from Stephanie and Sean. Let's take Sean first. "What is the CAEP policy for switching"-- oh, they're similar-- "funds between categories from 1000 to 5000?" I don't think we have a policy on that. In the old days and other programs, like WIOA II, I think there was a 10% rule or something like that.

But Veronica, is there any prohibition in NOVA for switching money between object codes? Is there some kind of threshold or anything like that? I don't know of any, but I was just checking with you.

No, and there aren't any, just as long as the budget remains balanced.

Right. And then the members have to approve it in order to get it certified, so there is some kind of oversight from the membership and the consortia when you're doing these switching of funds. So Sean, what might happen is, your membership might say, hey, I don't like you changing over these hundreds of thousands of dollars in a budget change. We're not going to approve that. That could happen.

But that's within your consortia. The state doesn't have any kind of policy on that, nor does NOVA restrict you from doing that. But your membership in your consortia could restrict you from doing that, so I would check with them before you go in, making wholesale changes.

So I think Stephanie had a similar question. Can you walk through how to update a past quarter that has already been submitted and certified? I think that's what you showed them, right, Veronica? That you uncertify? Or maybe if you just talk Stephanie through that?

Yes. I made the revision to the budget and work plan and not the expenditure report. However, the process is pretty similar. The primary contact/consortium lead would uncertify the expenditure report, and then the member representative will unsubmit the expenditure report. The expenditure report would then be open to make changes to the expenditures by object code, and then it'll do its additions and subtractions.

But that's how that worked. And in order to move forward with the next quarter, you would want to submit that quarter expenditure report and then move on to the next quarter.

And I also made a note, because I know everyone's asking about accounting principles and how I just arbitrarily reduced by $25,000 from one object code to the next. I'm not personally following any accounting principles. I'm just demonstrating how the system works. But like Neil said, definitely use your local accounting principles from your district office. My examples are just to demonstrate how the system works.

Right. Thanks, Veronica.

And Christian said, I thought CAEP had a 15% threshold. We used to, back in the old days. But when we moved to NOVA-- I just checked the fiscal management guide. We don't really have any thresholds for budget revisions. We took that out. So it's really up to the consortia and the membership to decide whether they want to go ahead and certify that budget revision, if they're comfortable with it.

OK, so I think we covered-- now we're into the juicy stuff. We're almost halfway through, and now we're into the juicy stuff. And if you thought the last two areas that we talked about were juicy, wait 'til you get to allocations and COLA.

So, as you know, the governor's proposed budget came out in January. Last week, we released the preliminary allocations for '20-'21 for CAEP. And that was by consortia, and I'll be posting those allocation numbers probably next week, if I get a chance, into NOVA. So if you were miraculously ready to submit your CFAD a month early, you would be able to do so probably by the end of next week. I'll get a chance to enter that into NOVA, and then you'll have a chance to work through your CFAD.

CFADs are still due May 2, because we have to turn that around and get an interagency agreement so we're not late sending the money out, and we're trying to work through that and fix that process. The governor usually approves that budget by July 1. I know last year, during the May revise, which is in mid-May, we had a reduction. That affects the schedule. So, if that ever happened this year, we'd have to deal with that as well.

And then, lastly, CAEP funds are released by August in 11 installments through May, but that requires that the CDE chancellor's office interagency agreement move the money over to CDE so they can release it for the K12 fiscal agent and K12 direct-funded members. So, we're trying to speed up that process, getting approval of this fund this month, and then starting that interagency agreement in April so we can have it all wrapped up so, when the governor signs the budget, we can be ready to move those funds over to CDE. And then, by August, they will be able to send the schedule to controllers. So you'd get that money maybe late August or September, hopefully, and not December, January, like happened this last year.

So let's talk about COLA. With the proposed governor's budget, there was a $2.29 million or $12.3 million COLA. As proposed, that rebenches the CAEP base from $538 million last year to $550,897,000 or $100,000 for next year. So all members are eligible for COLA. The COLA is based on the member's allocation percentage from the prior year's CFAD. The CFADs are critical of posting that member's accurate prior-year amount.

And the state made the decision the consortia cannot vote to exclude or prevent a member from receiving COLA, provided that that member received funding in a prior year. So they'd have to go back to that prior year. So if that member wasn't around last year or didn't receive funding, then they don't really have the opportunity to get that COLA, because there's nothing to base it on.