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    My CA
 SWCAP — Frequently Asked Questions (FAQs)
 
 
  1. What is the Statewide Cost Allocation Plan (SWCAP)?  answer
     
  2. What is the difference between SWCAP and Pro Rata?  answer
     
  3. What are Section I and Section II costs? What are the differences?  answer
     
  4. Who is responsible for preparing the Statewide Cost Allocation Plan?  answer
     
  5. How is a central service (SWCAP) plan used?  answer
     
  6. What is the difference between the SWCAP amounts in the Detail by Agency report, the agreement with federal Department of Health and Human Services (DHHS), and the amount budgeted?  answer
     
  7. When must a federally funded state department write to the State Controllerís Office to transfer the SWCAP recoveries from the federal funds to the General Fund?  answer
     
  8. For the state department's SWCAP cost (as used in the ICRP calculations), should I use the revised 2004-05 statewide cost allocation plan or the 2005-06? I was reviewing last yearís submission, and the 2003-04 SWCAP amount was used; therefore, I should use the 2004-05. However, I am confused. The expenditures are for the State's fiscal year of 2005-06 and I donít know what SWCAP amount to use for the 2005-06 plan. What amount should I use?  answer
     
  9. My state department wants to use the past year actual 2005-06 amount in the 2007-08 SWCAP Detail by Agency report in our Final 2005-06 ICRP. Is this correct?  answer
     
  10. How and when will my state department be notified of a revision to my SWCAP assessment?  answer

  1. What is the Statewide Cost Allocation Plan (SWCAP)?

    SWCAP is prepared annually by the Department of Finance, Fiscal Systems and Consulting Unit. The State of California provides certain services such as budgeting, accounting, auditing, payroll, etc., to operating agencies on a centralized basis. Since federally supported awards are performed within the individual operating agencies, a process is necessary to identify these central service costs and assign them to benefited activities on a reasonable and consistent basis. The federally reviewed and approved, statewide central service cost allocation plan provides that process.

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  2. What is the difference between SWCAP and Pro Rata?

    SWCAP and Pro Rata are developed from the same database of statewide central service cost allocations distributed by workload. SWCAP captures the distributed costs allowable by the federal government. Pro Rata captures the distributed costs recoverable from state special funds. Examples of central service costs not allowable in SWCAP but included in Pro Rata include the Legislature, State Treasurerís Investments and Cash Management and Trust Services, and State Retirement Warrants. The Attorney Generalís costs are included in SWCAP but not in Pro Rata because the Attorney General directly bills special funds for legal services provided.

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  3. What are Section I and Section II costs? What are the differences?

    Section I costs are Allocated Central Services where services benefit operating departments and/or programs are not billed on a fee for service or similar basis but allowable costs are allocated to benefited state departments on some reasonable basis.

    Section II costs are Billed Central Services where allowable costs are billed to benefited departments and/or programs on an individual fee for service or similar basis. Self-insurance and fringe benefit activities are other central service activities that bill customers for services or benefits provided.

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  4. Who is responsible for preparing the SWCAP?
     
    It is the responsibility of the Department of Finance to prepare the Statewide Cost Allocation Plan, commonly known as SWCAP.

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  5. How is a central service (SWCAP) plan used?

    The central service (SWCAP) plan is used to distribute allowable central service costs to each of the individual state department benefited, in order that they might include them in their indirect cost rate proposal (ICRP).

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  6. What is the difference between the SWCAP amounts in the Detail by Agency report, the agreement with Department of Health and Human Services (DHHS), and the amount budgeted?

    The SWCAP apportionments in the original Detail by Agency reports are subject to negotiation between the Department of Finance (Finance) and the DHHS. The negotiated SWCAP replaces the original proposed SWCAP. A state department may have approved ICRP that includes the original proposed SWCAP rather than the negotiated SWCAP. Such a state department will consider submitting an amended ICRP if the difference between the original and the negotiated SWCAP is material. The SWCAP amount budgeted is a portion of the total SWCAP apportioned to the state department. The budgeted amount was calculated by the state departmentís budget office in consultation with their Finance budget analyst. It typically represents the state departmentís federal support as a percentage of its total state operations. The amount calculated and budgeted is what the state department will recover from its federal funding sources as statewide indirect costs. It is included in the state departmentís billing rate through an approved ICRP.

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  7. When must a federally funded state department write to the State Controllerís Office to transfer the SWCAP recoveries from the federal funds to the General Fund?

    SWCAP recoveries must be transferred to the General Fund within 30 days after the end of the quarter in which they were recovered. See the State Administrative Manual Section 8755.2 (paragraph 2).

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  8. For the state department's SWCAP cost (as used in the ICRP calculations), should I use the revised 2004-05 statewide cost allocation plan or the 2005-06? I was reviewing last yearís submission, and the 2003-04 SWCAP amount was used; therefore, I should use the 2004-05. However, I am confused. The expenditures are for the State's fiscal year of 2005-06 and I donít know what SWCAP amount to use for the 2005-06 plan. What amount should I use?

    If you are preparing the 2005-06 ICRP, you should use your state department's SWCAP 2005-06 cost or the state department's SWCAP 2005-06 revised cost if the SWCAP plan was revised.

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  9. My state department wants to use the past year actual 2005-06 amount in the 2007-08 SWCAP Detail by Agency report in our Final 2005-06 ICRP. Is this correct?

    No. For 2005-06 or for any year, the SWCAP amount to be displayed in any ICRP is the Total Allocated for that year. State departments must not use the past year actual amount. This amount is included in the report only as part of the computation formula:

    Past Year Actual Ė Budget Year Estimate = Roll Forward Adjust-
      ment + Budget Year Estimate = Total Allocated

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  10. How and when will my state department be notified of a revision to my SWCAP assessment?

    State departments will be notified by e-mail after the SWCAP has been negotiated between Finance and the DHHS and the revised SWCAP apportionments have been added to the SWCAP Library on the SWCAP website.

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