|February 7, 2013
|WIC Policy Memo #2013-1
|WIC Policy Memorandum 2013-1 Offsetting Federal Claims against WIC State Agencies
Supplemental Food Programs
|WIC State Agency Directors
The purpose of this policy memorandum is to clarify that the presence of state appropriated funding in the operation of the WIC program does affect the manner in which federal claims against WIC state agencies may be satisfied. The determining factor is whether or not the federal and state funds are separately accounted for or commingled in the state agency’s WIC program operations.
In instances in which federal and state funds are segregated, the ability exists to distinguish which dollars have been used for unallowable purposes. In this instance, a federal claim should be asserted only for the amount of dollars spent inappropriately for WIC Program operations supported with federal funds. The state agency is liable for the value of any improper expenditure funded by its federal grant.
In instances in which federal and state funds are commingled, it may be impossible to determine whether federal or state funds were used for unallowable purposes. In this instance, the state agency is entitled to show that it has a sufficient amount of allowable expenditures to properly account for the total charges to its federal grant. In other words, if the state agency allocates and spends an amount of state funds for allowable costs that equals or exceeds the unallowable expenditures, no federal claim would exist.
The basis for this is the principle that in instances in which federal and state funds have been commingled, no presumption arises that it was the federal funds that were used for unallowable purposes without specific proof that it was the federal funds that were misspent.
Debra R. Whitford
Supplemental Food Programs Division