Statewide Indirect Cost Allocation Plan (SWCAP)
A state can recoup costs from the federal government for money it spends on federally mandated programs by either direct billing the federal programs through internal service funds or indirectly allocating the costs through a statewide indirect cost allocation plan. To charge indirect overhead costs to a federal program, a state must prepare a statewide indirect cost allocation plan and submit it to the United States’ Department of Human Services – Cost Allocation Services Division (US/DHHS/CAS) for review and approval.
The Office of the State Controller oversees the preparation of an indirect cost allocation plan for the State and is responsible for overseeing the preparation of the plan by a third-party contractor, providing cost and allocation data to the contractor so that a cost plan distributing indirect cost can be developed. We also respond to inquiries and resolve disputes with US/DHHS/CAS.
Following are links to the federally approved Cost Allocation Agreements, OMB Circulars establish federal requirements for statewide central services cost allocation plans, and the Budget Manual that establishes state policy for central service cost allocation and recovery.
Cost Allocation Agreement: