Generally, supplanting occurs when a state or local government reduces state or local funds for an activity specifically because federal funds are available or expected to be available to fund that same activity. Supplanting of state funds with HAVA funds is not permitted. Federal funds must be used to supplement existing state or local funds and may not replace state or local funding that has been appropriated or allocated for the same purpose or that is required by law.
No, states are not required to accept the funds. States that choose not to do so, should notify EAC with the reason via email to the [email protected] email address.
The funds can be used for any 2020 federal election which includes Presidential primaries, Congressional primaries and the November general election.
States are not required to place Section 101 state matching funds in the same fund with the federal funds. As a result, states can meet their matching requirements with funds within their existing budget authority.
The CARES Act is very specific about the use of the funds. They must be used “to prevent, prepare for, and respond to coronavirus, domestically or internationally, for the 2020 Federal election cycle.” The award instructions and EAC’s Guidance on Use of HAVA Funds for Expenses Related to COVID-19 provide many examples and answer questions about the use of CARES Act and other HAVA funds to address the pandemic. See the EAC website for the guidance at: https://www.eac.gov/election-officials/guidance-use-hava-funds-expenses-related-covid-19.
The state should follow the regulations at 2 CFR 200 related to the requirements for match documentation. They apply to subgrantee as well as grantees and the grantee is responsible for ensuring subgrantees are following the regulations and maintaining appropriate expenditure documentation. That said, the regulations do not prohibit such an approach. Therefore, yes, if that is a state’s strategy to identify and document match after considering the timeliness and expense of such an approach.
The regulations at 2 CFR 200 and the requirements under the CARES Act flow down to the subgrantees. Therefore, the documentation requirements for subgrantees are the same as they are for the states and any federal funds awarded to the subgrantees must be spent by December 31, 2020. The match, whether from the state or the counties can be spent after the end of the year, but it must be on allowable activities under the grant related to the effects of the pandemic on 2020 federal elections.
The limit is applied on each subgrantee. The maximum amount a state can include in its modified total direct rate is $25,000 for each subgrantee. E.g, if you have one subgrantee that gets $40,000 and another that gets $20,000, the amount you can include in the calculation of modified total direct costs is $45,000 (25,000 + $20,000).
In addition, subgrantees might also have indirect costs they could claim under the grant, either as federal share or local match. However, the state is responsible for determining if local offices have a negotiated indirect cost rate or could claim a de minimus 10%. There can also be local election offices that do not have any indirect costs; in which case, there would be no percentage to claim. The grantee must make those determinations before allowing subgrantees to claim indirect costs.
While the law limits expenditures to costs resulting from the effects of the pandemic on the 2020 elections, it still allows states two years to make the match funds available. However, it is difficult to see what costs could arise related to the 2020 elections in 2021 or 2022. Therefore, EAC encourages states to meet the match as they expend the federal funds before December 31, 2020. There could be costs associated with deep cleaning and sanitizing storage facilities or for post-election auditing that might occur in 2021.
If you have never had a negotiated indirect rate and are using the de minimus 10%, there is no documentation to maintain. Otherwise, the documents specifying your negotiated rate serve as the documentation.