Review of Costs Mobile Community Action, Inc., Allocated to Head Start Grant No. 04CH3465

Mobile Community Action, Inc. (MCA), overclaimed indirect costs charged to its Head Start grants by $148,000 during the period September 1, 2008, through August 31, 2010. In addition, MCA incorrectly reported Head Start expenses and indirect costs on its Federal Financial Status Reports (SF-269) for 2009 and 2010, made employee incentive payments that were not always approved by the Board of Directors or were not supported by adequate documentation, and drew Head Start funds without always documenting the basis for the drawdowns.

Under the American Recovery and Reinvestment Act of 2009, P.L. No. 111-5 (Recovery Act), enacted February 17, 2009, ACF received $3.15 billion including nearly $354 million to help improve staff compensation and training, upgrade Head Start centers and classrooms, increase hours of operation, and enhance transportation services. Also, $356 million was allocated to award all Head Start grantees a nearly 5 percent cost-of-living increase and to bolster training and technical assistance activities.