COMPTROLLER'S SEAL STATE OF CONNECTICUT

STATE OF CONNECTICUT

NANCY WYMAN
COMPTROLLER
OFFICE OF THE STATE COMPTROLLER
55 ELM STREET
HARTFORD, CONNECTICUT 06106-1775
MARK OJAKIAN
DEPUTY COMPTROLLER

MEMORANDUM NO. 2006-32

October 4, 2006

TO THE HEADS OF ALL STATE AGENCIES

Attention:   Chief Fiscal Officers or Business Managers
Subject:   Statewide Cost Allocation Plan for the Fiscal Year 2005-2006

Attached is the approved 2005-2006 Statewide Cost Allocation Plan, dated September 29, 2006.

Section I: Costs Distributed through State/Local-Wide Cost Allocation

This section contains the fixed approved central service costs by grantee agencies as listed in Exhibit A. The costs are to be incorporated into agency indirect cost proposals prepared using the appropriate fiscal year costs and other cost statements based upon the same fiscal year costs.

All state agencies receiving Federal or any other grants, or private funds, etc., must compute an indirect cost rate for each fiscal year of their Federal or other programs. The proposal is to be submitted for approval to the agency's cognizant Federal department or agency within six months after the close of each fiscal year. Generally, Federal cognizance of a particular state agency is assigned to that Federal department with the largest dollar involvement.

This indirect cost rate shall enable the state to recover both agency and statewide indirect costs as permitted by Federal regulations.

The central service costs are distributed to various "super-agencies" and an "all others" category. REQUESTS FOR A BREAKDOWN OF COSTS ALLOCABLE TO A PARTICULAR AGENCY CONTAINED WITHIN THOSE LARGER ORGANIZATIONAL STRUCTURES SHOULD BE ADDRESSED TO:

Office of the State Comptroller
Budget and Financial Analysis Division - Cost Unit
55 Elm Street
Hartford, Connecticut 06106-1775

Section II: Costs Distributed through Billing Mechanisms
The categories listed herein are approved to have their costs billed to the programs directly as the services or goods provided for herein are used by the programs.

Fringe Benefit Cost Recovery
The approved 2005-2006 fixed fringe benefit recovery rates for Unemployment Compensation and Retirement plans for covered payroll are listed in Exhibit B. The approved 2005-2006 fringe benefit recovery actual costs for the Medical Insurance, Group Life Insurance, FICA-Social Security, FICA-Medicare for covered payroll are directly identified by individual employee.

Covered payroll is all personal services expenditures for positions paid from Federal grants, Grants other than Federal, and other than General Fund accounts.

Fringe Benefit actual cost components for the Medical Insurance, Group Life Insurance, FICA-Social Security, FICA-Medicare are used along with the negotiated rates for Unemployment Compensation and for Retirement plan.

For information purposes, listed below are the breakdowns of the statewide fringe benefit recovery rates by fringe benefit component. These rates were originally published under Memorandum No. 2005-22.

Component    Rate
SERS - Regular Employees    34.70%
Alternate Retirement Plan    7.48%
Teachers Retirement Plan    13.02%
SERS - Hazardous Duty    34.61%
Judges/Compensation Commissioners    48.02%
Unemployment Compensation    0.28%

In addition, the rates listed below have been calculated based on the existing Federal tax rates.

FICA-Social Security Tax Rate    6.20%
FICA-Medicare Tax Rate    1.45%

Workers' Compensation Costs. Any Indirect Cost Proposal or Cost Allocation Plan prepared by agency that includes the 2005-2006 Statewide Cost Allocation Plan cost allocated to the agency should also include the actual cost of claims paid on behalf of the agency during the 2005-2006 fiscal year.

Agencies with a specific Worker's Compensation appropriation should use the total expenditures of that appropriation in their Indirect Cost Proposal or Cost Allocation Plan.
For all other agencies, a schedule of the amount of Worker's Compensation costs paid on their behalf in 2005-2006 and to be included in their Indirect Cost Proposal or Cost Allocation Plan was published in Comptroller's Memorandum No. 2006-25, dated July 19, 2006.

If you have any questions regarding this memorandum please call the Cost Reporting Unit, Budget and Financial Analysis Division at 860-702-3352.


NANCY WYMAN
STATE COMPTROLLER

NW:REG
Attachments

Exhibit A
Exhibit B
Cost Allocation Agreement

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