Report Title:

Office of Federal Revenue Maximization

Description:

Establishes a federal revenue maximization office within the department of budget and finance to secure eligible federal funds and grants for state programs.

HOUSE OF REPRESENTATIVES

H.B. NO.

1994

TWENTY-SECOND LEGISLATURE, 2004

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

relating to the office federal revenue maximization.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. Chapter 29, Hawaii Revised Statutes, is amended by adding a new part to be appropriately designated and to read as follows:

"PART . OFFICE OF FEDERAL REVENUE MAXIMIZATION

§29-A Definitions. As used in this part, unless the context otherwise requires:

"Agency" means a state department, board, commission, office, or other state entity, including the judicial branch of state government.

"Director" means the director of the office of federal revenue maximization.

"Federal funds" means all assistance provided or potentially available to state agencies from the federal government in the form of grants, matching funds, reimbursements, contracts, loans, loan guarantees, property, cooperative agreements, interest subsidies, insurance, direct appropriations, or any other method of disbursement pursuant to any federal act, regulation, order, or other federal law.

"Office" means the office of grant writing established by this part.

§29-B Office of federal revenue maximization. (a) There is established the office of federal revenue maximization within the department of budget and finance, for administrative purposes.

(b) The governor shall appoint, without regard to chapter 76, a director of the office who shall serve at the pleasure of the governor. The director's salary shall be within the range of salaries paid to deputy directors of the departments of the state government. The director shall be a member of the state employees' retirement system and shall be eligible to receive the benefits of any state or federal employee benefit program generally applicable to officers and employees of the State.

(c) The director shall have expertise in applying for federal funds for state programs. The director shall hire, without regard to chapter 76, persons having an expertise in applying for federal grant funding. Personnel from other agencies may be temporarily transferred to the office, pursuant to section 29-F, as may be needed to assist the office.

(d) The director, by contracts entered into without regard to chapter 103D, may retain the services of certified public accountants and other consultants, including a pool of professional grant writers pursuant to sections 29-I and 29-J, to pursue and collect federal funds, and perform other duties necessary to administer this part. At the option of the comptroller, consultants retained by contract under this subsection may be compensated:

(1) On a fixed-price basis;

(2) On an hourly rate basis with or without a fixed cap; or

(3) Through a contingent fee arrangement specified in the contract.

§29-C Duties of the office. The purpose of the office shall be to secure federal funds for any applicable state program. To achieve this purpose, the office shall:

(1) Serve as the principal office in state government responsible for applying for and maximizing federal funds;

(2) Serve as the State's clearinghouse for information on federal funds;

(3) Serve as an "early alert" on opportunities for obtaining federal funds to appropriate state agencies, by monitoring the federal register and other federal publications to identify federal funding opportunities, with special emphasis on discretionary grants or other funding opportunities that the State is not pursuing;

(4) Develop procedures to formally notify appropriate state and county agencies of the availability of federal funds;

(5) Coordinate all state efforts in applying for federal funds;

(6) Pool resources of all applicable state departments and agencies, as necessary;

(7) Monitor federal compliance, including following-up with applicable federal agencies, on behalf of state departments;

(8) Serve as liaison between the state and federal governments with respect to federal funds;

(9) Work with county agencies and local communities in determining local needs;

(10) Periodically review the funding strategies and methods of those states that rank significantly above the national average in the per capita receipt of federal funds, to determine whether those strategies and methods could be successfully employed by this State;

(11) Analyze proposed and pending federal and state legislation to determine whether the legislation would have a significant negative effect on the State's ability to receive an equitable share of federal funds;

(12) Adopt rules pursuant to chapter 91 as may be necessary to implement this part; and

(13) Do all other things necessary or proper to carry out the purposes of this part.

§29-D Consortium of agencies; multi-agency applications. The office, as appropriate, shall provide for the pooling of all applicable agency applications for federal funds into one or more multi-agency applications to maximize the target populations that are served by those agencies in applying for federal funds.

§29-E Cooperation with the office. All agencies shall cooperate with the office in providing any information the office deems necessary for the effective discharge of its duties and, to the greatest extent feasible, shall work with the office to actively seek all federal funds available to the State.

§29-F Temporary transfer of government personnel. (a) In order to take advantage of the expertise in various program areas in applying for federal funds, which is available within various state government agencies and which may be needed by the office from time to time, the director may arrange for temporary transfers of personnel from other state agencies into the office for periods not exceeding one year. Any transferred employee shall receive the employee's regular salary from the office during the transfer period and shall have the right to return to the employee's permanent position at the termination of the transfer period.

(b) No officer or employee of the State having tenure shall suffer any loss of salary, seniority, prior service credit, vacation, sick leave, or other employee benefit or privilege as a consequence of being temporarily transferred to the office.

(c) In the event that an office or position held by an officer or employee having tenure is abolished prior to the officer's or employee's return to their former position, the officer or employee shall not thereby be separated from public employment, but shall remain in the employment of the State with the same pay and classification and shall be transferred to some other office or position for which the officer or employee is eligible under the personnel laws of the State as determined by the head of the department or the governor.

§29-G Report. Not later than twenty days prior to the convening of each regular session of the legislature, the office shall prepare and submit a comprehensive report to the legislature on the effectiveness of the State's efforts to ensure receipt of an equitable share of federal funds for the preceding federal fiscal year. The report shall include:

(1) An executive summary that provides an overview of the major findings and recommendations included in the report;

(2) A comparative analysis of the State's receipt of federal funds relative to other states, prepared using the best available sources of data;

(3) An analysis of federal funding trends that may have a significant effect on resources available to the State;

(4) A description of any instances in which the State or a state agency has not pursued available opportunities to receive federal funds or earned federal funds and the reason for the failure to pursue the opportunity;

(5) An annual accounting, developed in consultation with the comptroller, of: all federal reimbursements or other federal funds brought into the State as a result of the office's efforts; all expenses incurred by the office; and the net positive or negative sum;

(6) Recommendations, developed in consultation with the comptroller, for any state legislative or administrative action necessary to increase the State's receipt of federal funds, enhance the recovery of indirect costs, or otherwise improve the State's management of federal funds; and

(7) Justification for the continued operation of the office, in view of the legislature's intent that the office be abolished if it is unable to secure federal funds in an amount at least double its operating budget by the end of fiscal year 2005.

§29-H Federal funds coordinators; agency reports. (a) Each state agency shall designate an employee on the management or senior staff level to serve as the agency's federal funds coordinator. An agency shall not create a staff position for a federal funds coordinator. The coordinator's duties shall be additional duties of an employee of the agency. Each federal funds coordinator shall:

(1) Oversee and coordinate the agency's efforts in acquiring federal funds;

(2) Send the office a quarterly report listing the grants for which the agency has applied and listing the catalogue of federal domestic assistance number and giving a short description of the grant; and

(3) Notify the office of the award or denial of a federal grant to the agency.

(b) Each state agency or institution shall file an annual report with the office concerning the agency's efforts in acquiring available federal funds during the preceding state fiscal year. The office shall establish guidelines for information included in the annual report required by this section. The office shall evaluate the effectiveness of each agency in acquiring federal funds and shall report to the governor and the legislature.

§29-I Grant writing team. The director shall establish a grant writing team in the office, which shall:

(1) Develop a plan for increased access by the State to available federal funds; and

(2) Coordinate with other state agencies to develop a plan for the use of federal grant funds.

§29-J Grant information. The office may:

(1) Establish a clearinghouse of information relating to the availability of federal funds;

(2) Establish an automated information system database for grant information and make it available for use by state agencies and counties;

(3) Provide counseling to state agencies, counties, nonprofit charitable institutions, educational institutions, and residents of the State relating to the availability and means of obtaining federal funds;

(4) Provide or enter contracts, without regard to chapter 103D, with appropriate entities to provide assistance in writing grant proposals to individuals and through workshops and institutional assistance;

(5) Publicize the services and activities of the grant writing team through chambers of commerce, councils of government, department newsletters, county governments, state agencies, institutions of higher education, business organizations, private philanthropic organizations, and other appropriate entities and methods;

(6) Maintain a list of approved grant managers for grant projects that require grant managers; and

(7) Analyze the criteria for grants for which state agencies are denied access because of state law or rules or agency organization and suggest to an affected state agency changes in rules or organization that would increase the probability of the agency's receiving federal or other grants.

§29-K Fees. When appropriate, the office shall charge and collect fees from persons, other than state or county agencies, who use the grant writing team's services and who receive a grant. The fees shall be set in amounts necessary to cover all or a part of the costs of carrying out this section."

SECTION 2. Section 29-14, Hawaii Revised Statutes, is amended to read as follows:

"§29-14 Boards, etc., may accept funds, comply with federal acts. Except as provided by part    , and as otherwise provided by law, any board, commission, department, or officer of the State may accept and receive on behalf of the State, and receipt for, any and all grants or allotments of federal-aid moneys made available to the State, by or pursuant to an act of Congress, and enter into or make such plan, agreement, or other arrangement with the agency designated by the act of Congress as is necessary to carry out the purposes of the Act; provided that, if as a condition to receiving the federal-aid moneys it is necessary to match all or any part of the grant or allotment with state moneys, no plan, agreement, or arrangement may be entered into unless the board, commission, department, or officer has under its or the officer's control moneys [which] that may be expended lawfully for the purpose.

The governor may transfer funds from the department of health to the department of human services and from the department of human services to the department of labor and industrial relations to obtain additional federal funds for medical assistance under Title XIX of the Social Security Act, as amended, and the work incentive program. The governor may also transfer funds from one department to another for the purpose of obtaining federal matching grants and allotments; provided that the state moneys have been appropriated for the purpose for which federal grants and allotments may be obtained."

SECTION 3. Section 29-24, Hawaii Revised Statutes, is amended to read as follows:

"§29-24 Interagency federal revenue maximization revolving fund. (a) There is established in the state treasury an interagency federal revenue maximization revolving fund into which shall be deposited all funds and proceeds collected from the federal government and third-party payors for costs not previously claimed by the State, with the exception of proceeds collected for services provided by the Hawaii health systems corporation, for reimbursement by federally-funded state programs[.] including any federal funds for any applicable state program secured by the office of federal revenue maximization, pursuant to part    . For purposes of this chapter, federally-funded state programs include but shall not be limited to those federally-funded programs within the departments of human services, education, and health.

(b) Expenditures and transfers from the fund shall be made by the comptroller in proportional allocations established by the comptroller and the director of finance. Transfers shall be made to the department claiming the reimbursement for expenses incurred related to federal fund reimbursement claims and to the general fund of the State. Moneys in the fund may be expended for consultant services rendered under [subsection (b).

(b) Notwithstanding any other law to the contrary, the comptroller, by contract, may retain the services of certified public accountants and other consultants to pursue and collect federal fund reimbursements, and perform other duties necessary to administer this section. At the option of the comptroller, consultants retained by contract under this subsection may be compensated on:

(1) A fixed-price basis;

(2) An hourly rate basis with or without a fixed cap; or

(3) Through a contingent fee arrangement specified in the contract.

Such compensation shall be payable out of all sums the consultant recovers for the State.] section 29-B(d).

(c) No later than twenty days prior to the convening of each regular session of the legislature, the comptroller shall submit to the legislature a report including the following information:

(1) Itemized amounts of all federal reimbursements[;] and other federal funds;

(2) Description and amounts of all expenses incurred by the fund;

(3) Method of compensation and amounts of compensation for all certified public accountants and other consultants retained by the comptroller to pursue and collect federal fund reimbursements and other federal funds and perform other duties necessary to administer this section;

(4) Method of determining allocation of funds;

(5) Amounts allocated by the comptroller; and

(6) Fund balances."

SECTION 4. It is the intent of the legislature that the office of grant writing aggressively seeks and obtains federal grants. The legislature further intends that the amount of funds attained through the efforts of the office of federal revenue maximization, not only make the office self-sustaining, but by the end of fiscal year 2009, be equal to at least double the operating budget of the office. Accordingly, it is the legislature's intent that the office be abolished at the end of fiscal year 2009, as provided in section 9 of this Act, unless the office is able to show, pursuant to section 29-G, Hawaii Revised Statutes, that its efforts have resulted in that level of federal funding.

SECTION 5. In codifying the new sections added by section 1 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.

SECTION 6. It is the intent of this Act not to jeopardize the receipt of any federal aid nor to impair the obligation of the State or any agency thereof to the holders of any bond issued by the State or by any such agency, and to the extent, and only to the extent, necessary to effectuate this intent, the governor may modify the strict provisions of this Act, but shall promptly report any such modification with reasons therefor to the legislature at its next session thereafter for review by the legislature.

SECTION 7. There is appropriated out of the general revenues of the State of Hawaii the sum of $          , or so much thereof as may be necessary for fiscal year 2004-2005, for the establishment of the office of federal revenue maximization. The sum appropriated shall be expended by the department of budget and finance for the purposes of this Act.

SECTION 8. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 9. This Act shall take effect on July 1, 2004; provided that this Act shall be repealed on June 30, 2009, and sections 29-14 and 29-24, Hawaii Revised Statutes, are reenacted in the form in which they read on the day before the approval of this Act.

INTRODUCED BY:

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