New York Codes, Rules and Regulations › Title 9 - EXECUTIVE DEPARTMENT › Subtitle S - Division of Housing and Community Renewal › Chapter III - Low Rent Housing › Subchapter D - Accounting Manual For Public Housing Agencies › Part 1640 - General Information › Subpart 1640-3 - Ineligible Expenditures › Section 1640-3.2 - Determination of eligibility

Current through Register Vol. 46, No. 28, July 10, 2024
(a) In
						determining the eligibility of expenditures, both the purpose for which the
						expenditure was made and the amount of the expenditure and the manner in which
						it was made, are examined. An expenditure may, thus, be declared ineligible
						even if it is for an authorized or approved purpose, if it is in excess of an
						approved amount, or has been made without the required approvals or
						authorizations on the part of either the local agency, or the division, or
						both. In certain cases, expenditures to be eligible, require the specific
						approval or authorization of the division, in others, the priorapproval or
						authorization of the division is required, and, in some cases, the approval or
						prior approval or authorization of the division of the commitment for the
						expenditure is required as well. The division's requirements with respect to
						approvals are contained in the manuals of procedure[FN*].
(b) The more important standards used to test
						the eligibility of expenditures are here summarized for the information and
						guidance of local agencies. Details will be found, by subject, in other
						sections of this Subchapter.
(1) Direct
						connection. Expenditures may be declared ineligible because they are not an
						essential cost or expense directly connected with the development or operation
						of a specific project under the terms of the contract for State aid for that
						project.
(2) Statutory provisions.
						Expenditures may be declared ineligible because of the operation of specific
						provisions of the Public Housing Law. The more important of these provisions
						relate to the compensation of members of a local housing authority,
						administrative expenses of an authority, and tax exemptions. Applicable
						provisions of other statutes, such as the exemption from Federal income and
						excise taxes granted by the U.S. Internal Revenue Code, may also operate to
						render expenditures ineligible.
(3)
						Mingling of funds. Expenditures may be declared ineligible because they
						constitute a mingling of funds, as defined in Subpart 1640-2, supra.
(4) Rules and regulations. Expenditures may
						be declared ineligible for failure to comply with the rules and regulations of
						the division and various instructions and directives issued by the division,
						and having the effect of rules and regulations. Such rules, regulations,
						instructions and directives may specify the purpose for which the expenditure
						is made, limit the amount which may be expended, and prescribe the manner in
						which the expenditure may be made. The latter refers to procedures in
						connection with the letting of contracts, requirements for approval or prior
						approval, etc. In some cases, notably in connection with land acquisition, the
						requirements for approval reach beyond the expenditure itself to require prior
						approval or authorization by the division of the commitment for the
						expenditure.
(5) Contract for State
						aid. Expenditures may be declared ineligible for failure to comply with the
						terms of the contract for State aid. The contract for State aid incorporates,
						by reference, the application for financial assistance, and expenditures, to be
						eligible, must also comply with the terms of the application. In a contract for
						the advance of loan funds by the State, it is evident that the maximum amount
						of the loan operates as a limit on the total amount of eligible expenditures
						possible.
(6) Budgetary and
						extra-budgetary limitations. Expenditures in excess of amounts budgeted for the
						various eligible purposes may be declared ineligible. Expenditures for
						development purposes are controlled by a development cost budget which forms
						part of the application for financial assistance. Expenditures during the
						operating period, are, similarly, controlled by an operating budget submitted
						annually. Overruns of the amounts budgeted for the various eligible purposes
						may, however, be authorized by the division under certain conditions. The
						amount of the overrun which may be authorized for a particular item is limited
						by regulation of the division and there are some budget items for which no
						overruns will be authorized because of extra-budgetary limitations reflected in
						the contract for State aid, in the application for financial assistance, in
						instructions and directives of the division, in rulings of the commissioner, or
						in supplementary agreements between the division and the local agency. Land
						acquisition costs are a common example of the application of extra-budgetary
						limitations.
(7) Internal approvals
						and authorizations. Expenditures may be declared ineligible for failure to
						comply with the requirements for internal approval and authorization by the
						local agency. Certain requirements for internal approval and authorization may
						be set up by the division, as in the case of the requirement that all
						expenditures shall be properly vouchered; other requirements may be set up on
						the initiative of the local agency. A great deal, of course, depends on the
						size and organization of the local agency. Some expenditures may require only
						the approval of appropriate officers or employees of the local agency; others
						may require appropriate resolution of the governing and policy-making body of
						the local agency; still others may require authorization, by the appropriate
						body of the local agency, of the commitment to make the expenditures, as
						well.
(8) Examples of ineligible
						expenditures. Exhibit 9 of Appendix S-6 lists typical ineligible expenditures
						which will not be allowed as project costs or expenses. Revisions will be made
						from time to time, as the need may arise.
[FN*] See Subchapter C of this
						  Chapter.