The ultimate intent of this report is to ensure transparency and accountability which will reduce and mitigate potential vulnerabilities. The Montana Office of Public Instruction will use these results to provide technical support and drive healthy conversation around performance improvement.

In compliance with 2 CFR 200.332(b), the OPI assesses subrecipients to identify those at greater risk of noncompliance with federal laws, regulations and grant award provisions. OPI uses the risk assessment when evaluating the entity’s applications for competitive and continuing federal formula awards to determine whether specific conditions and/or additional monitoring will be applied to the entity’s federal awards. 

Under CFR §200.332(b) the Uniform Grant Guidance describes the requirements of a pass-through entity (OPI) to complete a Risk Assessment on sub-recipients. The guidance permits OPI the authority to develop a risk assessment to meet the state’s needs. 

All subgrantees that receive funds through OPI as a pass-through agency are subject to a Risk Assessment.
 

Six categories were determined to be significant indicators of risk that may adversely affect the ability of an LEA to achieve its objectives.  The categories include Program Risk Determination, Program Assurance, Fiscal Program Performance, Reporting Timeliness, Academic Performance, and Finance Fiscal Audit. 

Montana Office of Public Instruction (OPI) created a catalog of required criteria (Risk Factors) for the Risk Assessment by using appropriate public metrics such as Single Audit Findings. 

A subgrantee may be designated as high-risk for noncompliance if the subgrantee:
1.    Has a History of failure to comply with general or specific terms and conditions of a federal award: 
2.    Has failed to meet performance goals specified in the federal award;
3.    Is not financially stable
4.    Has a management system which does not meet the management standards set forth by the federal government;
5.    Had not conformed to terms and conditions of previous awards, including timely submission of required fiscal and program reports and audits; 
6.    Has numerous and/ or  repeated audit findings that have not been satisfactorily addressed: or
7.    Is otherwise not responsible.
8.    Beginning with FY2023 audits, any audits not submitted timely will automatically be delegated as “High-Risk”.
 

What is a Risk Score?

The Risk Assessment uses points that are a total accumulation based on the analysis of risk factors within the risk indicators. Higher Points represent greater risk. A risk score is the total of the individual sub-scores calculated for each of the six risk indicators: Program Risk Determination, Program Assurance, Fiscal Program Performance, Reporting Timeliness, Academic Performance, and Finance Fiscal Audits. 

How is it calculated? 

The sub-score for 4 risk indicators (Program Risk Determination, Program Assurance, Fiscal Program Performance, and Reporting Timeliness) is calculated by summing the total points divided by the 20 Federal Programs.  The scores are computed using a weighted scale to ensure equality regardless of the school size or the amount of federal program awards allocated. The two final risk indicators, Academic Performance and Finance Fiscal Audit, are calculated as a single sub-score based on having only one risk factor.  

The subtotal risk factor values from each of the six risk indicators were combined into the categories low, medium, and high.  

The total risk factor values were computed using a weighted scale to ensure equality regardless of the school size and/or the amount of federal program awards allocated.   

The final scoring value determines level of risk for each LEA. 

Low Risk = 0-14 

Medium Risk =15-22  

High Risk=23 and above

The risk level is the conversion of the risk score into Low, Medium, and High categories. The Risk Level is individually calculated for each entity to ensure an accurate depiction of potential risk. The ultimate intent is to ensure transparency and accountability which will reduce and mitigate potential vulnerabilities. Montana Office of Public Education (OPI) will use these results to provide technical support and drive healthy conversation around performance improvement.

The OPI may apply special conditions, restrictions, or monitoring procedures to federal competitive and formula grants that are awarded to high-risk subgrantees. Such special conditions and restrictions will correspond to the risk condition that exists for a particular subgrantee and may include: (2 CFR §200.207)

 

1. Payment on a reimbursement, rather than an advance basis;
2. Withholding authority to proceed to the next phase until receipt of evidence of acceptable performance within a given funding period;
3. Additional financial and/or program reports with more detail;

 

4. Additional project monitoring;
5. Requiring the subgrantee to obtain additional technical or management assistance; and/or
6. Requiring additional prior approvals.

Prior to imposing special conditions or restrictions, the OPI will notify the subgrantee in writing of: (2 CFR §200.207)

1. The nature of the special conditions/restrictions;
2. The reason(s) for imposing special conditions/restrictions;
3. Corrective actions which must be taken before the special conditions or restrictions will be removed and the time allowed for completing the corrective actions; and
4. The method whereby a subgrantee may request reconsideration of the conditions/restrictions imposed.

 

In section 600, under, High-Risk Appeal Process in the Montana State and Federal Handbook it states, Schools have the right to appeal a high-risk designation if they feel the designation was made in error or if they feel they have corrected the issues which led to the High-Risk designation. 
Please see the specifics in the handbook starting on page 92.