Payment of Subgrantees

Q.  Where do I find the FTA definition of "Incurred cost"?  TheTexas Department of Transportation believes Incurred Cost to be " a transit agency must pay all costs for goods or services to be eligible for reimbursement."

A. The payment of grantees and subgrantees is not controlled by FTA Circular 4220.1F (which precludes advance payments to contractors) but by 49 CFR 18.21(c), which states that grantees and subgrantees are to be paid in advance unless they lack an adequate system for minimizing time between payments in and disbursements out. The Texas DOT is confusing FTA payment requirements regarding contractors (4220.1F) and subgrantees (49 CFR 18.21(c). (Revised: May 2010)