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Fiscal Management

Disaster response programs receiving grants, donations, or other external funding should use financial management systems to ensure that these funds are used appropriately, adequate documentation of transactions are maintained, and assets are safeguarded.

Most sources of disaster-related funds require that their allocation be tracked and monitored separately from existing monies the agency already maintains for routine services. The development of financial tracking systems must satisfy these objectives by reporting financial results of grants and donations, maintaining records on the source and use of these funds, and safeguarding the disaster-related assets and funds. These systems should include accounting, property, procurement, and internal controls. Every community and state/territory/tribe has a fiscal structure and should work closely with its fiscal representative.

Below is a list of things to keep in mind when managing a disaster response program:

  • Ensure the effective flow of grant funds.
  • Comply with regulations and program guidelines set by the funding source.
  • Include a fiscal representative or liaison to work with the disaster response program team. The size of the disaster will determine the amount of time needed for the fiscal staff member.
  • Promote understanding procurement and contracting requirements.
  • Ensure prompt payment of invoices and payroll.
  • Reduce stress for management and staff.

Cost-effective budgeting involves the following:

  • Locating in-kind office space and materials.
  • Partnering with local media outlets and printers to develop low-cost or no-cost public information materials.
  • Collaborating with community groups to develop training curriculum and locate training space.
  • Collaborating with community groups who offer coffee, snacks, toys, or other donated goods to survivors who are receiving services.

Program and Funding Limitations

Many disaster-related funding streams tie restrictions to the use of the funds. Often funds donated for a specific disaster are restricted from use for any other event or for routine services conducted outside disaster-related activities. Each state/tribe/territory may have rules around how funds enter its system and require certain types of contracting to move money into localities. Localities may also have a specific manner for accepting grants and donations. Many federally and state funded grants have limitations on allowable expenses. If you are working with federal grants, be aware of what the fiscal requirements and the allowable and nonallowable expenses are for your particular disaster response program. As an example, the federally funded Crisis Counseling Assistance and Training Programs (CCP) have the following restrictions:

  • Advocacy
  • Case management
  • Medications
  • Hospitalization
  • Disaster preparedness
  • Formal mental health treatment
  • Formal substance misuse treatment
  • Transportation for survivors
  • Fundraising
  • Toys
  • Food, beverages, and refreshments

Typically, each funding source will provide detailed specifics of allowable and nonallowable expenses for grants, donations, and other external disaster-related funds. : Check with your fiscal representative, liaison, or grant manager to ensure that you aware of all allowable and nonallowable expenses.

Additional Resource

Federal Register. (2005). "Cost Principles for State, Local, and Indian Tribal Governments." Vol. 70, No. 168.

Appendix B to Part 225—Selected Items of Cost, has a complete list of allowable and nonallowable costs.

Last Updated: 05/24/2019