August 17, 2015
TO THE ADMINISTRATOR ADDRESSED:
SUBJECT: Risk assessment level for school year 2015–2016 (fiscal year 2016)
As a pass-through entity, TEA awards federal grant funds to eligible subrecipients, including local educational agencies (school districts and open-enrollment charter schools). The responsibilities of pass-through entities are given in Title 2 of the Code of Federal Regulations, Part 200.331, which requires TEA to “evaluate each subrecipient’s risk of noncompliance with federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring.”
To comply with this requirement, TEA’s Division of Federal Fiscal Monitoring conducts an annual federal fiscal risk assessment of all subrecipients, including local educational agencies, to determine their potential risk of noncompliance. The specific criteria used in the risk assessment are published on the division’s webpage. Based upon the outcome of the risk assessment, subrecipients are assigned a risk level of low, medium, or high.
Accessing Your Risk Level
TEA has assigned all local educational agencies a risk level for the 2015–2016 school year. You may learn your risk assessment level by accessing the GFFC Reports and Data Collections secure application, where you will find a letter for your organization. The letter indicates your risk level. Follow these steps to access your letter:
1. Log on to TEASE or TEAL.
2. Select “GFFC Reports and Data Collections.”
3. Select “Risk Assessment Level” from the report title drop-down menu.
4. Select “2015–2016” from the school year drop-down menu.
Purpose of the Annual Risk Level
The risk assessment is used to determine the likelihood that a subrecipient may fail to comply with applicable rules. If your organization is assigned a high risk level (as a result of the annual risk assessment), it does not indicate that your organization has failed to comply with applicable rules. Similarly, a low risk level does not indicate that your organization is compliant with applicable rules. Only your independent auditor or a TEA monitor can determine if your organization is compliant or noncompliant.
The risk assessment is conducted annually, so your organization’s risk level can change from year to year. A subrecipient assigned a high risk level for 2015–2016 may be assigned a medium or low risk level in 2016–2017.
Affect of Different Risk Levels
An organization’s risk level will be used by TEA in the following ways:
• Differentiated Grant Negotiation. TEA uses a differentiated grant negotiation process for federal grant applications. Organizations with a medium or high risk level are subject to a more stringent grant negotiation review than those with a low risk level.
• Subrecipient Monitoring. Each year, TEA selects subrecipients for fiscal monitoring according to their risk levels. The higher your organization’s risk level, the more likely your are to be selected for monitoring.
For Further Information
If you have questions about the annual risk assessment, please contact the Division of Federal Fiscal Monitoring at firstname.lastname@example.org.
Mark Hernandez, Director
Division of Federal Fiscal Monitoring