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Reduction in the FFP Rate for Administrative Expenditures


Published: August 27, 1987



August 27, 1987

SUBJECT:Reduction in the Federal financial participation (FFP) rate for administrative expenditures in the Child Support Enforcement Program.


BACKGROUND:Under Section 4 of Public Law 98-378, the "Child Support Enforcement Amendments of 1984", the FFP rate for administrative costs incurred in the operation of the Title IV-D State plan is being decreased from 70 to 68 percent in Fiscal Year 1988. (See Section 455(a)(2)(B) of the Social Security Act.)

The FFP rate reduction pertains to all expenditures incurred on or after October 1, 1987, for which Federal funding is available at the "regular FFP rate." The "enhanced FFP rate" approved for expenditures incurred in accordance with an advanced planning document is not being reduced and will remain at 90 percent.


REQUIRED:1) Semi-Annual Budget Estimates (Form OCSE-25)

No changes required.

The Federal share of expenditures are not reported on this form. However, projections of total expenditures should be made with the understanding that the Federal share of all "regular" expenditures in fiscal years 1988 and 1989 will be at the 68 percent rate. The "regular FFP rate" will be further reduced to the 66 percent rate for expenditures projected for fiscal year 1990 and thereafter.

2)Quarterly Application for Grant Award (FormOCSE-65)

The "State and Local Funds Available" for the quarterly expenditures being estimated on line 1 of this form should equal 32 percent of the estimated total "regular" expenditures for quarters beginning on or after October 1, 1987.

3)Quarterly Report of Expenditures (Form OCSE-41)

In accordance with the formula provided on the reverse of the form, the total Federal share of current quarter (column a) expenditures reported on line 10 will be calculated utilizing the 68 percent FFP rate for quarters ended on or after December 31, 1987.

The total Federal share of prior quarter increases (column b) or decreases (column c) reported on line 10 will be calculated at the FFP rate in effect during the quarter to which the expenditure increases and decreases pertain. (Form OCSE-41-SUPP should be included as an attachment to detail any prior quarter adjustments.) A table showing the changes in the FFP rates since the inception of the program is provided on Form OCSE-41.

In determining the proper FFP rate for prior quarter increasing and decreasing expenditure adjustments, the provisions of 45 CFR 304.25(a), define expenditures as being incurred on the date payment is made to the service provider by either the State or local IV-D agency or a public agency operating pursuant to a cooperative agreement with the State agency.

4)Quarterly Report of Collections (Form OCSE-34)

No changes required.


DATES:The change in the "regular FFP rate" is effective for all expenditures being projected, estimated or reported for fiscal quarters beginning on or after October 1, 1987, under the following reporting schedule:

Form OCSE-65: Effective with the report for the quarter beginning October 1, 1987. (Submission due date: August 15, 1987.)

Form OCSE-41: Effective with the report for the quarter ended December 31, 1987. (Submission due date: January 30, 1988.)

INQUIRIES TO: OCSE Regional Representatives


Associate Deputy Director

Office of Child Support Enforcement

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