Many of you may have already received notice that your company’s CERTS grant application has been approved. Some of your applications may still be in “Application Signed and Submitted — Under Review” status, which means that the U.S. Treasury Department is still reviewing the application.
Still others may find the status reading “Action Needed.” If that is your situation, look for an email from certs@treasury.gov to find out what is missing or needs to be addressed. Or call the helpline at 877-398-5862. Respond to the Treasury as soon as possible to get them what they need.
So, what’s next after the approved status? We wait until the Treasury has completed vetting all applications for all four eligible industries. Then the Treasury can develop the distribution formulas. At that point, an approved application status should be updated to “Application Approved — Grant Amount Pending.” Treasury will then post the industry allocation methodology and the grant sizing formula.
The grant agreement
Once the applicant grant amounts have been calculated, Treasury will send each company a standard program grant agreement (read it carefully) and the status will change to “Grant Agreement Available for Signature.” The grant agreements are to be signed electronically. Then the status should be updated to “Grant Agreement Signed by Applicant.”
Grant funds should be distributed within two to three business days (the portal originally said one day) after the agreement has been signed by an authorized company representative.
Each grantee has one year from the date of receipt to use the money. Otherwise, the funds must be returned. The treasury uses the term “claw back,” which refers to the government taking back the monies not used on eligible costs.
Recordkeeping
Each recipient must retain records to support how the CERTS grant funds are used. This is an important part of compliance reporting and for supporting reported amounts if audited.
Eligible uses of the grant funds
- Payment of payroll costs:
- Salaries.
- Wages.
- Commissions.
- Tips.
- Paid time off.
- Health insurance.
- Retirement benefits.
- State or local payroll taxes.
- Compensation to a sole proprietor.
- Compensation to an independent contractor.
- Purchasing Personal Protective Equipment (PPE) and other costs of protecting workers and customers from COVID-19.
- Costs to operate and maintain capital equipment/facilities, such as rents, leases, insurance, interest on regularly scheduled debt service (not the principal).
Ineligible uses of funds
- Payment/prepayment of principal debt.
- Capital expenditures.
- Delinquent taxes.
- Compensation in excess of an annualized $100,000 salary ($8,333 per month, etc.).
- FICA taxes.
- Compensation for an employee residing outside of the U.S.
- Any wages used for Families First Coronavirus Response Act (FFCRA) sick leave credit.
- Any wages used for qualified family leave credit.
- Any bonus in excess of inflation.
- Any expense used for any other federal programs.
One final note, CERTS grantees will be disclosed on the website, usaspending.gov.
UMA Member Tracy Fickett, CPA, operates BUSBooks, a specialty accounting firm dedicated to the motorcoach industry. If you have a question, you can reach her at tracy@busbooks.co.
