4.5 Cost Categories and Allowable Activities

4.5.2 Cost Categories and Allowable Activities

Effective date: July 1, 2025

ACCOUNTING

The cost of establishing and maintaining accounting and other information systems required for the management of DWD-DET grants is allowable. This includes costs incurred by central service for those same purposes.

ADVERTISING AND PUBLIC RELATIONS¹

Advertising costs include the costs of media services and corollary administrative costs. Advertising media includes, but is not limited to, magazines, newspapers, radio and television programs, direct mail, convention exhibits, electronic or computer transmittals, and the like.

1. Allowable Advertising Costs. The only allowable advertising costs are those which are required for the performance of a federal award:
   • Recruitment of personnel required for federally funded grants.
   • Procurement of goods and services.
   • Disposal of surplus materials.
   • Specific requirements of DWD-DET grants.
   • Participant and employer outreach.
2. Public Relations. Includes community relations and means those activities dedicated to maintaining the image of the recipient or subrecipient or maintaining or promoting understanding and favorable relations with the community or public at large or any segment of the public. The only allowable public relations costs are those which are for:
   • Costs specifically required by the grant;
   • Costs of communicating specific activities or accomplishments of the grant; or
   • Costs of conducting general liaison with news media and government public relations officers to keep the public informed on matters of public concerns.

ADVISORY COUNCILS²

Costs incurred by WDBs, local boards, advisory councils, or delegate committees for functions relative to federally funded grant programs are allowable if authorized by statute, the federal awarding agency, or as an indirect cost where allocable to federal awards.

ALCOHOLIC BEVERAGES³

Costs of alcoholic beverages are unallowable.

AUDIT SERVICES⁴

Financial and compliance audit costs incurred by the recipient are allowable if the audit is procured and performed in accordance with requirementsthe Single Audit Act Amendments of 1996.⁵ Certain audit costs are unallowable, including costs when audits required by the Single Audit Act and 2 CFR 200, Subpart F have not been conducted or not conducted in accordance with the requirements, and costs of auditing a non-federal entity that is exempted from having an audit conducted under the requirements because its expenditures under Federal awards are less than $1,000,000 during its fiscal year.

The costs of a financial statement audit of a recipient or subrecipient that does not currently have a federal award is allowable and may be included in the indirect cost pool for a cost allocation plan or indirect cost proposal.

Pass-through entities may charge Federal awards for the cost of agreed-upon procedures engagements to monitor subrecipients exempt from having an audit conducted under the Single Audit Act and the requirements of 2 CFR 200, Subpart E.

AUTOMATED DATA PROCESSING

The cost of data processing services is allowable.

BAD DEBTS⁶

Bad debts, or debts which are uncollectible, including losses, whether actual or estimated, arising from uncollectible accounts and other claims, are unallowable.

BONDING COSTS⁷

Costs of bonding required under a federal award's terms and conditions are allowable.

Costs of bonding required by the recipient or subrecipient in the conduct of its operations are allowable as an indirect cost.

COLLECTIONS OF IMPROPER PAYMENTS⁸

Costs incurred by a recipient or subrecipient to recover improper payments are allowable as either direct or indirect costs, as appropriate.

COMPENSATION - PERSONAL SERVICES⁹

Compensation for personal services includes all remuneration, paid currently, or accrued, for services rendered during the period of performance under the grant, including, but not necessarily limited to wages and salaries. Compensation for fringe benefits is addressed in section "Compensation - Fringe Benefits".

1. Compensation. Costs for compensation are allowable to the extent that total compensation for individual employees meets the following requirements:
   • Compensation is reasonable for the services rendered. Compensation for employees engaged in work on federal awards will be considered reasonable to the extent that it is consistent with that paid for similar work in other activities of the recipient or of similar local organizations.
   • Compensation follows an appointment made in accordance with the recipient's documented policy, and meets the requirements of federal, state, and local laws, where applicable.
   • Compensation is determined and supported by paragraphs B. and D. of this subsection.
2. Special Considerations. Certain conditions require special consideration and possible limitations in determining costs where amounts or types of compensation appear unreasonable. Among such conditions are the following:
   • Determinations should be made that cost is reasonable for the actual personal services rendered when compensation is made to members of nonprofit organizations, trustees, directors, associates, officers, or the immediate families thereof.
   • DWD-DET may review any change in the recipient's compensation policy resulting in a substantial pay increase in the recipient's level of compensation.
3. Incentive Compensation. Incentive compensation based on cost reduction, efficient performance, suggestion awards, etc. is allowable provided the overall compensation is reasonable and such costs are paid or accrued pursuant to the recipient's documented policies and procedures.
4. Standards for Documentation of Personnel Expenses. Charges to federal grants for salaries and wages must be based on records that accurately reflect the work performed. Time and attendance or equivalent records must support payroll records for individual employees. Employees' salaries and wages chargeable to more than one cost objective must be supported by appropriate cost distribution records. The method used must produce an equitable distribution of time and effort, and:
   • Where time distribution reports are used, these reports must reflect actual activity of each employee. Budget estimates determined before the services are performed do not qualify as support for charges to grants.
   • Where time distribution reports are used, these reports must be signed by the individual employee or by some other submission and acknowledgement method or technology, or by their supervisor with knowledge of the activities performed by the employee, attesting that the distribution of their time is an actual statement of the work performed by the employee during the time period(s) covered by the report.
   • Each time distribution report must account for the total activity for which the employee is compensated, and which is required in fulfillment of their obligations to the recipient.
   • Salaries and wages of employees used in meeting cost matching requirements on awards shall be supported in the same manner as salaries and wages claimed for reimbursement from granting agencies.

COMPENSATION - FRINGE BENEFITS¹⁰

Fringe benefits are allowances and services provided by employers to their employees as compensation in addition to regular salaries and wages. Except as provided elsewhere in this section, the costs of fringe benefits are allowable provided that the benefits are reasonable and required by law, recipient-employee agreement, or the recipient's documented policies and procedures. Fringe benefits include, but are not limited to, the following:

1. Leave. Regular compensation paid to employees for authorized absences from the job for annual leave, family-related leave, sick leave, holidays, court leave, military leave, and other similar benefits, are allowable if the following criteria are met:
   • They are provided under established documented policies and procedures.
   • The costs are equitably allocated to all related activities, including federal grants.
   • The accounting basis (cash or accrual) selected for costing each type of leave is followed consistently by the recipient.
     1. If leave is accounted for using the cash basis, costs may be expensed as employees paid leave for the period that the leave is taken. Payments for unused leave when an employee retires or terminates employment are allowable in the year of payment.
     2. The accrual basis may be used only for those types of leave for which a liability as defined by GAAP exists when the leave is earned. Allowable leave costs are the lesser of the amount accrued or funded.
2. Fringe Benefits. The cost of fringe benefits in the form of employer contributions or expenses for social security, employees' life and health insurance plans, unemployment insurance coverage, worker's compensation insurance, retirement plans for staff, and the like are allowable, provided such benefits are granted under established, documented plans. Costs must be equitably allocated to all related activities, including federal grants.
3. Severance Pay. Payments in addition to regular salaries and wages, made to workers whose employment is being terminated, are allowable to the extent that, in each case, they are required by law, employment agreement, or established documented policies and procedures. Actual severance payments, but not accruals, associated with normal turnover are allowable. Negotiated settlements made upon termination or because of a grievance are not allowable. Costs must be equitably allocated to all related activities, including federal grants.
4. Pension plan. The subrecipient shall have established written policies pertaining to pension plan benefits. Pension plan costs incurred in accordance with the established written policies of the subrecipient are allowable, provided that such policies meet the test of reasonableness; the methods of cost allocation are not discriminatory; the cost assigned to each fiscal year is determined in accordance with GAAP; and the costs assigned to a given fiscal year are funded for all plan participants within six months after the end of that year.
5. Insurance. Provisions for a reserve under a self-insurance program for unemployment compensation or workers' compensation are allowable to the extent that the provisions represent reasonable estimate of the liabilities for such compensation and the type of coverage, the extent of coverage, and rates and premiums would have been allowable had insurance been purchased to cover the risks.
   
   Insurance costs on the lives of trustees, officers or other employees holding positions of similar responsibility are allowable only to the extent that the insurance represents additional compensation.
   
   Actual claims paid to or on behalf of employees or former employees for workers' compensation, unemployment compensation, severance pay, and similar employee benefits are allowable in the year of payment provided that the recipient or subrecipient follows a consistent costing policy.

CONFERENCES¹¹

Costs associated with events whose primary purpose is to disseminate technical information beyond the recipient or subrecipient and are necessary and reasonable for the performance of the federal award, including the cost of renting facilities, meals, local transportation, speakers' fees, and other items incidental to such conferences, are allowable.

CONTINGENCY PROVISIONS¹²

Contributions to a contingency reserve or any similar provision made for events for which the occurrence cannot be foretold with certainty as to time, intensity, or with an assurance of their happening are unallowable. The term "contingency reserve" excludes self-insurance reserves, pension funds, and reserves for normal severance pay.

CONTRIBUTIONS AND DONATIONS¹³

1. Contributions and Donations Made. Funds paid by the recipient or subrecipient to other entities are unallowable.
2. Contributions and Donations Received.
   • Professional and technical personnel, consultants, and other skilled and unskilled labor may furnish donated (volunteer) services to the recipient. The value of these services is not reimbursable, either as a direct cost or an indirect cost.
   • Donated goods or use of space may be furnished to a recipient. The value of the goods and space is not reimbursable, either as a direct cost or an indirect cost. However, depreciation or use allowances may be charge on donated assets in keeping with the provisions in section "Depreciation".

DEFENSE AND PROSECUTION OF LEGAL CLAIMS¹⁴

Costs incurred for any criminal, civil, or administrative proceeding commenced by the federal, state, local, tribal, or foreign government are not allowable if the proceeding relates to a violation of, or failures to comply with, a federal, state, local, tribal, or foreign government statute or regulation by the recipient or subrecipient, including its agents and employees.

DEPRECIATION¹⁵

1. Allowability. Compensation for the use of recipient's or subrecipient's buildings, capital improvements, leasehold improvements and equipment is allowable and made by computing the proper depreciation.
2. Basis. The computation of depreciation shall be based on the acquisition cost of the asset(s) involved. Where actual cost records have not been maintained, a reasonable estimate of the original acquisition cost may be used in the computation. The acquisition cost of an asset donated to the recipient by a third party shall be its fair market value (FMV) at the time of the donation.
3. Computation. When computing depreciation charges, the acquisition cost will exclude:
   • The cost of land;
   • The cost or any portion of buildings, leasehold improvements, and equipment provided or donated directly or indirectly by the federal government;
   • Any portion of the cost of buildings and equipment contributed by or for the recipient claimed in satisfaction of a statutory matching requirement; and
   • Any asset acquired solely for the performance of a non-federal grant.
4. Depreciation Method. When computing depreciation charges, the following must be observed:
   • The useful life established for assets must take into consideration such factors as the type of construction, nature of the equipment, technological developments of the asset(s), historical data, and the renewal/replacement policies followed for the individual asset or classes of assets involved.
   • The depreciation method used to charge the cost of an asset or group of assets to accounting periods must reflect the consumption of the asset during its useful life. Without clear evidence that expected consumption of the asset will be significantly greater in early portions of its useful life than in later portions, the straight-line method must be recognized as the appropriate method. Switching the asset's depreciation method is unallowable unless approved by DWD-DET.
   • No depreciation is allowed on any assets that have outlived their depreciable lives.
5. Recordkeeping. Depreciation charges must be supported by adequate property records and records showing the amount of depreciation must be maintained. Physical inventories must be taken at least once every two years to ensure the assets exist and are usable, used, and needed.

EMPLOYEE HEALTH AND WELFARE¹⁶

Costs of internal publications, health or first aid clinics, employee counseling services, and other expenses incurred in accordance with the recipient's or subrecipient's documented policies for the improvement of working conditions, employer-employee relations, employee morale, and employee performance are allowable.

ENTERTAINMENT AND PRIZES¹⁷

Entertainment Costs. Recipient or subrecipient staff costs for amusement, diversion, social activities, ceremonials, and other related costs are unallowable unless they have a specific and programmatic purpose and are included in the federal award.

Prizes. Costs of prizes or challenges are allowable if they have a specific and direct programmatic purpose and are included in the federal award.

EQUIPMENT AND OTHER CAPITAL EXPENDITURES¹⁸

The following rules of allowability must apply to equipment and other capital expenditures:

• Expenditures for general purpose equipment, buildings and land are allowable as direct costs, but only with the prior written approval of the federal awarding agency or pass-through entity.
• Expenditures for special purpose equipment are allowable as direct costs, provided that items with a unit cost of $10,000 or more have the prior written approval of the federal awarding agency or pass-through entity.
• Cost of equipment disposal. If the federal agency instructs the recipient or subrecipient to otherwise dispose of or transfer the equipment, the costs of disposal or transfer are allowable.
• Capital expenditures for improvements to land, buildings (including leasehold improvements), or equipment that materially add to the value of the asset or appreciably prolong its life, are allowable as a direct cost, but only with the prior written approval of the federal awarding agency or pass-through entity.
• Equipment and other capital expenditures are unallowable as indirect costs.
• See subsection "Depreciation" for allowability of depreciation on buildings, capital improvements, and equipment. Also, see subsection "Rental Costs" for allowability of rental costs for land, buildings, and equipment.

FINES AND PENALTIES¹⁹

Costs of fines, penalties, damages, and other settlements resulting from the recipient's violations of, or failure to comply with, federal, state, and local laws and regulations are unallowable.

FUND RAISING AND INVESTMENT MANAGEMENT²⁰

1. Fund Raising. Costs of organized fund raising, including financial campaigns, endowment drives, solicitation of gifts and bequests, and similar expenses incurred solely to raise capital or obtain contributions, along with any indirect costs related to such efforts, are unallowable.
2. Investment Management. Costs of investment counsel and staff and similar expenses incurred solely to enhance income from investments are unallowable. Costs associated with investments covering retirement, self-insurance, or other such funds are not considered 'investment management.' Additionally, costs related to the physical custody and control of monies and securities are allowable.

GAINS AND LOSSES ON DISPOSITION OF DEPRECIABLE PROPERTY²¹

1. Recognition. Gains and losses on the sale, retirement, or other disposition of depreciable property must be included as credits or charges to the asset cost grouping(s) of the property in the year in which they occur. The amount to be recognized is the difference between the amount realized on the property and the undepreciated basis of the property.
2. Restrictions. Gains and losses are unallowable when:
   • The gain or loss is processed through a depreciation reserve account and is reflected in the depreciation allowable under 2 CFR 200.436, 200.439.
   • The property is given in exchange as part of the purchase price of a similar item and the gain or loss is considered in determining the depreciation cost of the new item.
   • A loss results from the failure to maintain permissible insurance, expect as otherwise provided in 2 CFR 200.447.
   • Compensation for the use of the property was provided through use allowances in lieu of depreciation in accordance with section "Depreciation".

GENERAL COSTS OF GOVERNMENT²²

Costs of salaries and other expenses of local governmental bodies, such as a county supervisors or city councils, are considered a cost of general local government and are unallowable. Costs of general types of government services normally provided to the general public, such are fire and police protection, are unallowable unless provided for as a direct cost under a program statute or regulation.

GOODS OR SERVICES EXPENDED FOR PERSONAL USE²³

Costs of goods or services for employee personal use are unallowable, regardless of whether the cost is reported as taxable income to the employee.

Housing costs, housing allowances, and personal living expenses for the recipient's or subrecipient's employees are only allowable as direct costs and must be approved by the federal awarding agency.

IDLE FACILITIES AND IDLE CAPACITY²⁴

The costs of idle facilities and idle capacity, including costs for maintenance, repair, housing, rent, and other related costs such as property taxes, insurance, or depreciation are unallowable except to the extent that they are necessary to meet workload requirements which may fluctuate and are allocated appropriately to all benefitting programs; or they were necessary when acquired and are now idle because of changes in program requirements and other factors that could not have been reasonably foreseen. Under these exceptions, the costs of idle facilities are allowable for a reasonable period, depending on the initiative taken to use, lease, or dispose of such facilities.

INSURANCE AND INDEMNIFICATION²⁵

Costs include insurance the recipient is required to carry, or which is approved under the terms of the grant, and any other insurance the recipient maintains in connection with the general conduct of its operations. This subsection does not apply to insurance that represents fringe benefits for the recipient's employees. This subsection applies as follows:

• Costs of insurance required or approved and maintained pursuant to the grant are allowable.
• Costs of other insurance in connection with the general conduct of activities are allowable subject to the following limitations:
  1. Types and extent of coverage shall be in accordance with the recipient's documented policies and sound business practice. Rates and premiums shall be reasonable under the circumstances.
  2. Costs of insurance or of any contributions to a reserve covering the risk of loss of, or damage to, government property are allowable to the extent that the recipient is liable for such loss or damage.
  3. Costs allowable for business interruption or other similar insurance must exclude coverage of management fees.
  4. Costs of insurance on the lives of trustees, officers, or other key employees are allowable only to the extent that the insurance represents additional compensation. Where the recipient is the beneficiary of such insurance, the cost is unallowable.
• Actual losses which could have been covered by permissible insurance, through the purchase of insurance or a self-insurance program, are allowable if:
  1. Expressly Authorized in the federal award.
  2. Costs incurred because of losses not covered under nominal deductible insurance coverage provided in keeping with sound business practice.
  3. Minor losses not covered by insurance, such as spoilage, breakage, and disappearance of supplies, which occur in the ordinary course of operations.

INTEREST²⁶

Costs incurred for interest on borrowed capital, temporary use of endowment funds, or the use of the recipient's or subrecipient's own funds are unallowable. Financing costs (including interest) to acquire, construct, or replace capital assets are allowable, subject to specific requirements.

LABOR RELATIONS COSTS

Costs incurred to maintain satisfactory relations between the recipient and its employees are allowable. Costs may include publications, training, and related activities.

LOBBYING²⁷

The costs of certain influencing activities associated with obtaining grants, contracts, cooperative agreements, or loans is unallowable.

LOSSES ON OTHER AWARDS²⁸

Any excess of costs over income under any other award or contract of any nature is unallowable. Also, any excess of costs over authorized funding levels transferred from any award or contract to another is unallowable.

MAINTENANCE AND REPAIR COSTS²⁹

Costs incurred for necessary maintenance, repair, or upkeep of buildings, leasehold improvements, and equipment, including governmental property unless otherwise provided for, which neither add to the value of the property nor appreciably prolong its useful life, but keep it in an efficient operating condition, are allowable. Costs incurred for improvements that add to the value of the asset or appreciably prolong its useful life must be treated as capital expenditures in accordance with 2 CFR 200.439.

MATERIAL AND SUPPLIES COSTS³⁰

Costs of materials and supplies necessary for the performance of the grant are allowable. Purchased materials and supplies must be charged at their actual prices, net of applicable credits. Withdrawals from general stores or stockrooms should be charged at their actual net cost under any recognized and consistently applied method of pricing. Material and supplies charged as a direct cost should include only the materials and supplies actually used for the performance of the grant. Charging computing devices as direct costs is allowable for devices that are essential and allocable, but not solely dedicated, to the performance of the grant.

MEMBERSHIPS, SUBSCRIPTIONS, AND PROFESSIONAL ACTIVITY COSTS³¹

1. Memberships. The costs of the recipient's membership in civic, business, technical, and professional organizations are allowable, provided that:
   • The benefit from the membership is related to a DWD-DET grant;
   • The expenditure is for the recipient's or subrecipient's membership;
   • The cost of the membership is reasonably related to the value of the services or benefits received; and
   • The expenditure is not for membership in an organization that devotes a substantial part of its activities lobbying.
2. Subscriptions. Costs of the recipient's subscriptions to civic, business, professional, and technical periodicals are allowable, when related to a DWD-DET grant.

ORGANIZATION COSTS³²

Costs of establishing or reorganizing an agency are allowable if prior approval is obtained from the federal awarding agency or pass-through entity. These costs may include legal, accounting, consulting, or other service fees. The costs related to data and evaluation including, but not limited to, expenditures needed to gather, store, track, manage, analyze, or otherwise use data to administer or improve the program, are allowable.

PLANT AND SECURITY COSTS³³

Necessary and reasonable costs incurred for wages and equipment for the protection of facilities, personnel, and work products are allowable.

PRE-AWARD COSTS³⁴

Costs incurred prior to the effective date of the grant are allowable only with prior written approval of DWD-DET and if they would have been allowed if incurred after the start date of the grant. Costs related to preparing program plans, applications, and budgets required by DWD-DET are not "pre-award costs."

PROFESSIONAL SERVICE COSTS³⁵

Costs of professional and consultant services rendered by persons who are members of a particular profession or possess a special skill, and who are not officers or employees of the recipient, are allowable when reasonable in relation to the services provided. Legal and related services are limited under 2 CFR 200.435.

PROPOSAL COSTS³⁶

Costs incurred in preparing bids, proposals, or applications for potential grants are allowable as indirect costs and must be allocated to all current activities.

PUBLICATION AND PRINTING COSTS³⁷

1. Publication. Costs for electronic and print media, including distribution, promotion, and general handling are allowable. If such costs cannot be identified with a particular cost objective, they should be allocated as indirect costs to all benefitting activities of the recipient.
2. Page Charges for Professional Journals. The costs at normal publisher rates are allowable where the publications report work supported by the federal government and the charges are levied impartially on all items published by the journal.

REARRANGEMENT AND RECONVERSION COSTS³⁸

1. Rearrangement. Costs incurred for ordinary and normal rearrangement and alteration of facilities are allowable as indirect costs. Special arrangements and alteration costs incurred specifically for a federal grant are allowable as a direct cost with prior approval of the federal awarding agency or DWD-DET.
2. Reconversion. Cost incurred in the restoration or rehabilitation of the recipient's facilities to approximately the same condition existing immediately prior to the effective date of a DWD-DET funded grant, less costs related to normal wear and tear, are allowable.

RECRUITING COSTS³⁹

Costs for advertising, testing, evaluating, hiring, and training employees/potential employees are allowable. Costs must be reasonable and not in excess of standard commercial rates if employment agencies are used by the recipient or subrecipient.

RELOCATION COSTS OF EMPLOYEES⁴⁰

Costs for the relocation of employees are allowable, subject to limitations⁴¹, provided that: the move is for the benefit of the employer; reimbursement to the employee is in accordance with written policy, the reimbursement does not exceed the employee's actual (or reasonably estimated) expenses.

RENTAL COSTS OF REAL PROPERTY AND EQUIPMENT⁴²

Subject to the limitations described below, rental costs are allowable to the extent the rates are reasonable. Reasonableness of costs considers factors such as: rental costs of comparable property, if any; market conditions in the area; available alternatives; and the type, life expectancy, condition, and value of the leased property.

1. Sale and Leaseback. Rental costs under sale and leaseback arrangements are allowable only up to the amount that would be allowed had the recipient continued to own the property. This amount would include depreciation, maintenance, taxes, and insurance.
2. Related Party Leases. Rental costs under related party, or "less-than-arm's-length," leases are allowable only up to the amount as explained in paragraph A above. For this purpose, a related party lessee is one under which one party to the lease agreement can control or substantially influence the actions of others. Such leases include, but are not limited to those between:
   • Divisions of the recipient or subrecipient;
   • The recipient or subrecipient under common control through common officers, directors, or members; and
   • The recipient or subrecipient and a director, trustee, officer, or key employee of the recipient and their immediate family, either directly or through corporations, trusts, or similar arrangements in which they hold a controlling interest.

Rental of any property owned by individuals or entities affiliated with the recipient or subrecipient, including commercial or residential real estate, for purposes such as a home office, is unallowable.

SELLING AND MARKETING COSTS⁴³

Costs of selling and marketing any products or services of the recipient or subrecipient are unallowable unless they are allowed under 2 CFR 200.421 and are necessary to meet the requirements of the grant award.

SPECIALIZED SERVICE FACILITIES⁴⁴

The cost of specialized, complex facilities when necessary for the performance of the grant is allowable provided the charges for the services meet specific conditions⁴⁵ and take into account any items of income or Federal financing that qualify as applicable credits under 2 CFR 200.406.

TAXES⁴⁶

In general, taxes or payments in lieu of taxes (PILOT) which the recipient is required to pay are allowable, except for:

• Taxes from which exemptions are available to the recipient or subrecipient;
• Special assessments on land which represent capital improvements;
• Federal income taxes; and
• State income taxes.

TELECOMMUNICATION AND VIDEO SURVEILLANCE COSTS⁴⁷

Costs incurred for telecommunications and video surveillance services or equipment such as telephones, internet, video surveillance, cloud servers and the like are allowable, and unallowable circumstances include obligating or expending covered telecommunications and video surveillance services or equipment as described in 2 CFR 200.216.

TERMINATION COSTS⁴⁸

Termination of a grant may cause the incurrence of costs, or the need for special treatment of costs, which would not have occurred had the grant not been terminated. Cost principles covering these items are detailed below. They are to be used in conjunction with other provisions of this section in termination situations, subject to the availability of funds.

• The cost of items reasonably usable in the recipient's other work are unallowable unless the recipient submits evidence that it would not retain such items at cost without sustaining a loss.
• If certain costs cannot be discontinued immediately after the effective date of termination, such costs are generally allowable, but only up to the amount of the grant. Such costs continuing after termination due to the negligent or willful failure of the recipient to discontinue such costs shall be unallowable.
• Loss of useful value of special tooling, machinery and equipment which was not charged to the grant as a capital expenditure is generally allowable if not reasonably capable of use in the other work of the recipient.
• Rental costs under unexpired leases are generally allowable where clearly shown to have been reasonably necessary for the performance of the terminated grant less the residual value of such leases, if:
  1. The amount of such rental claimed does not exceed the reasonable use value of the property leased for the period of the grant and such further period as may be reasonable, and
  2. The organization makes all reasonable efforts to terminate, assign, settle, or otherwise reduce the cost of such lease. There also may be included the cost of alterations of such leased property, provided such alterations were necessary for the performance of the grant, and of reasonable restoration required by the provisions of the lease.
• Settlement expenses, including the following, are generally allowable:
  1. Accounting, legal, clerical, and similar costs reasonably necessary for the preparation and presentation to the grantor of settlement claims and supporting data with respect to the terminated portion of the grant, unless the termination is for default; and for the termination and settlement of subgrants.
  2. Reasonable costs for the storage, transportation, protection, and disposition of property provided by the DET or acquired or produced for the grant; except when grantees are reimbursed for disposals at a predetermined amount.

TRAINING AND EDUCATION COSTS⁴⁹

The cost of training and education for employee development is allowable.

TRANSPORTATION COSTS⁵⁰

Costs for freight, shipping, postage, and other transportation services related to goods purchased, in process, or delivered, are allowable.

TRAVEL COSTS⁵¹

Travel costs for transportation, lodging, subsistence, and related incidental costs incurred by recipient employees who are in travel status on official business are allowable when they are directly attributable to specific work under a grant, subject to following:

• Costs may be charged on an actual basis, on a per diem or mileage basis in lieu of actual costs incurred, or on a combination of the two, provided the method used results in charges consistent with those normally allowed in like circumstances and in accordance with recipient's written travel reimbursement policies.
• Costs for traveling to a foreign county must be authorized in the grant agreement.

TRUSTEES⁵²

Travel costs and per diems for trustees or directors are allowable. Costs must be in accordance with the recipient's written policies and procedures.

• ¹ 2 CFR §200.421
• ² 2 CFR 200.422
• ³ 2 CFR §200.423
• ⁴ 2 CFR §200.425
• ⁵ 31 U.S.C. 7501-7507
• ⁶ 2 CFR §200.426
• ⁷ 2 CFR §200.427
• ⁸ 2 CFR §200.428
• ⁹ 2 CFR §200.430
• ¹⁰ 2 CFR §200.431
• ¹¹ 2 CFR §200.432, WIOA Policy Manual section 4.18.1, and WIOA Policy Manual section 4.19.1
• ¹² 2 CFR §200.433
• ¹³ 2 CFR §200.434
• ¹⁴ 2 CFR §200.435
• ¹⁵ 2 CFR §200.436
• ¹⁶ 2 CFR §200.437
• ¹⁷ 2 CFR §200.438
• ¹⁸ 2 CFR §200.439
• ¹⁹ 2 CFR §200.441
• ²⁰ 2 CFR §200.442
• ²¹ 2 CFR §200.443
• ²² 2 CFR §200.444
• ²³ 2 CFR §200.445
• ²⁴ 2 CFR §200.446
• ²⁵ 2 CFR §200.447
• ²⁶ 2 CFR §200.449
• ²⁷ 2 CFR §200.450
• ²⁸ 2 CFR §200.451
• ²⁹ 2 CFR §200.452
• ³⁰ 2 CFR §200.453
• ³¹ 2 CFR §200.454
• ³² 2 CFR §200.455
• ³³ 2 CFR §200.457
• ³⁴ 2 CFR §200.458
• ³⁵ 2 CFR §200.459
• ³⁶ 2 CFR §200.460
• ³⁷ 2 CFR §200.461
• ³⁸ 2 CFR §200.462
• ³⁹ 2 CFR §200.463
• ⁴⁰ 2 CFR §200.464
• ⁴¹ 2 CFR 200.464(b)
• ⁴² 2 CFR §200.465
• ⁴³ 2 CFR §200.467
• ⁴⁴ 2 CFR §200.468
• ⁴⁵ 2 CFR 200.468(a)
• ⁴⁶ 2 CFR §200.470
• ⁴⁷ 2 CFR §200.471
• ⁴⁸ 2 CFR §200.472
• ⁴⁹ 2 CFR §200.473
• ⁵⁰ 2 CFR §200.474
• ⁵¹ 2 CFR §200.475, WIOA Policy Manual section 4.18.1
• ⁵² 2 CFR §200.476