Current through Reg. 50, No. 187; September 24, 2024
(1) Transactions between a SAMH-Funded Entity
and a related party that appear to result, as determined by the department on
the basis of the standards in subsection (3), of this rule, in additional cost
to the program shall be reimbursed to the SAMH-Funded Entity in an amount equal
to the eligible cost which would have been allowed had no related party been
involved. Any cost in excess of what would have been allowable by the
department shall be disallowed.
(2)
If the department determines on the basis of the standards in subsection (3),
of this rule, related party involvement has caused an increase in cost, the
department shall have access to the financial records of the related party in
order to determine the allowable cost of the transaction. If the department is
not allowed full and unrestricted access to the records of the related party,
all payments to the related party questioned by the department shall be
disallowed.
(3) The following
related party transactions shall be reviewed by the department for compliance
with Generally Accepted Accounting Principles:
(a) Transactions between a SAMH-Funded Entity
and related party who have common ownership or control.
(b) The existence of a related party
primarily for the benefit or purpose of a SAMH-Funded Entity. Primary benefit
or purpose is defined to be when fifty percent or more of the gross revenues of
the related party are received from or for the SAMH-Funded Entity or fifty
percent of the expenditures of the related party are made to or for the benefit
of the SAMH-Funded Entity. The department shall carefully review the
documentation provided in all such situations before making a decision. The
final determination shall rest with the department.
(c) If real or personal property has ever
been transferred between a related party and a SAMH-Funded Entity,
reimbursement for the use of the property transferred shall not exceed the
lower of fair market value or actual cost to the transferor.
(d) If a related party leases property to a
SAMH-Funded Entity and subsequently makes a cash or in-kind donation to the
lessee, the department shall disallow any amount that exceeds the lower of the
market value lease cost or the ownership costs of the related party.
(e) A SAMH-Funded Entity which leases
property or delivers services to another SAMH-Funded Entity shall do so at
cost. The cost incurred shall be reasonable and delivered at the lowest
available cost for the service. The lowest available cost shall be documented
by evidence that the SAMH-Funded Entity solicited services from other entities
and selected the lowest cost available. Documentation for the decision shall be
maintained by the SAMH-Funded Entity for review by the department.
(f) If a SAMH-Funded Entity loans money to
any other party and subsequently leases property or buys services from the same
party, the SAMH-Funded Entity and the second party shall be deemed to be
related parties.
(g) If a
SAMH-Funded Entity leases property from a related party, any cost in excess of
fair market value shall be considered an unallowable cost.
(h) Space donated by a related party in a
building previously owned by a SAMH-Funded Entity or by a related party who
exists primarily for the benefit of the SAMH-Funded entity shall be valued for
match and reimbursable cost purposes at the fair market value of the
space.
Rulemaking Authority
394.78(1),
394.9082(3) FS.
Law Implemented 394.78(3),
394.9082
FS.
New 2-23-83, Amended 2-25-85, Formerly 10E-14.16,
10E-14.016, Amended 7-1-03, 7-27-14.
