Eligible Cost Listing (May 23, 2006)

Annex B

Eligible Cost Listing

This list has been developed as a guide for all Service Canada programs in determining whether costs described in the proposal are to be considered eligible for negotiation, and is not to be considered exhaustive and all-inclusive. Inclusion in this list does not suggest that those cost items must be automatically allowed in whole or in part. However, completely disallowing, in whole, any cost item included in this list must be substantiated. It is important to note that the existing principles of negotiation remain. Costs must be determined to be a reasonable use of public funds, reasonable in amount, and contribute to the success of the project.

No costs are eligible as a contingency option. Costs must be foreseeable to be negotiated in the original agreement and will otherwise require a negotiation and amendment when incurred.

Certain costs have been slotted under specific categories and types to support the formula used in the Flat Rate Costing methodology. These costs must always be included in these categories in order to maintain the integrity of the methodology.

1. PROJECT COSTS

A. Activity Related Direct Project Costs: These are project specific costs that have been itemized, cost estimated and defended in the proposal. They are expenses specific to the project activities included in the proposal. These are costs related to functions, which are project specific. For example, wages/salaries and related office costs of management or other staff whose time is spent specifically on management or delivery of project activities (i.e. project managers, employment counselors, Chief Executive Officer (CEO) dedicating some time to overseeing management of project activities, a human resources advisor working specifically on project staff and project management issues, a financial officer working specifically on project bookkeeping, an administrative clerk performing duties required for the project , etc.). Reimbursement will be supported by invoices (and/or travel claims, as appropriate) and will be subject to monitoring and audit.

Examples of costs for which a contribution can be considered include, but are not limited to:

1) Staff Wages

a) Staff wages and Mandatory Employment Related Costs (may include wages or portion thereof of support staff whose time and activities can be directly attributable to the project, such as IT staff, bookkeeper’s time for preparing claims etc.);
b) Other employment-related benefit costs (Workers Compensation Benefit (WCB), medical, dental, pension, etc.) where warranted by current organizational Human Resources (HR) policies;
c) Other HR costs such as extended illness and maternity leave, vacation leave pay out, severance pay, etc. where warranted by current organizational HR policies and provincial labour standards. (This is not a contingency option. Costs must be foreseeable to be negotiated in the original agreement and will otherwise require a negotiation and amendment when incurred.);

2) Professional Fees

d) Professional fees - contracting (e.g. bookkeeping, janitorial services, Information Technology (IT), equipment maintenance services, security, if contracted specifically to support the project; audit costs and legal fees are noted separately below);
e) legal fees (i.e. reasonable allowance for costs related to review of lease for new project site premises);

3) Travel

f) Staff and volunteer travel (transportation costs, taxi, kilometric charges, etc. as per staff travel claims; includes international travel where warranted; transportation is noted in category 1C);

4) Capital Assets

g) Capital assets (any asset requiring agreement of disposition, as per program specific Terms and Conditions (Ts and Cs) value; may be any of the assets included in this listing);

5) Audit Costs (departmentally mandated)

h) Audit costs related to departmentally mandated audits;

6) Other activity related direct project costs

i) Furniture;
j) Staff disability supports (duty to accommodate);
k) Staff training for disability-related issues (e.g. sign language training);
l) Conference attendance fees;
m) Conference costs (meeting room rental, guest speakers, etc.);
n) Rent, lease (including applicant owned premises) and repairs and leasehold improvements (insurance is noted below, in category 1C);
o) Signage;
p) Utilities;
q) Equipment lease, rental or purchase (including computers, fax machines, etc.; meter charge for photocopies is included in the equipment repair and maintenance cost item below, in category 1C);
r) Computer software;
s) Costs associated with use of applicant-owned assets other than premises (e.g. computers and other equipment, furniture, etc.);
t) Memberships (professional and organizational), affiliation fees and business licenses and permits;
u) Advertising (newspaper ads, flyer production, etc.);
v) Reference materials (books, periodicals, subscriptions, etc., which cannot be easily traced/tracked back to usage by project participants);
w) Significant project costs associated with the following types of expenditures (i.e. one-time, non-recurring, non standard/non-basic amounts over and above the regular, day-to-day operational costs):
- i. Telephone (installation and extraordinary costs related to telephones and/or fax lines required over and above regular operating requirements);
- ii. Postage (significant costs associated with project activities, which increase expected costs of postage beyond normal operating requirements);
- iii. Internet (web page design, etc.) and other IT requirements (significant costs associated with project activities, which increase expected internet related costs beyond normal operating requirements);
- iv. Printing (significant costs associated with project activities, which increase expected printing costs beyond normal operating requirements); and
- v. Staff professional development (courses required by staff, which are not part of the routine development courses required by the organization's policies);
x) Costs related to transition/wind-down (severance pay, other HR related costs, penalties for breaking leases, etc.).

B. Participant Related Direct Project Costs: Expenses associated with the Participant of a particular project. Reimbursement will be supported by invoices and will be subject to monitoring and audit.

Examples of costs for which a contribution can be considered include, but are not limited to:

7) Participant Wages

a) Participant wages and Mandatory Employment-Related Costs (MERCS);
b) Completion Bonuses (stipends);
c) Other employment-related benefit costs (WCB, medical, dental, pension, etc.) where warranted by current organizational HR policies and/or provincial labour standards;

8) Participant Tuition Costs

d) Tuition costs - public;
e) Tuition costs - private;

9) Other Participant Related Project Costs

f) Living expenses;
g) Disability-related supports (attendant care, note takers, sign language interpreters);
h) Disability-related incremental costs (i.e. additional per diems for fees for assistance provided, etc.);
i) Professional fees related to participants - sub-contracting (i.e. vocational assessments, needs assessments, guest speakers, etc.);
j) Dependant care;
k) Adaptive-technology set-up;
l) Materials and supplies, books and testing materials, to be used by/for participants;
m) Travel, transportation; and
n) Participation and completion recognition activities.

C. Other Direct Project Costs: Expenses associated with the project under this heading can be included in payments that are based on a formula.

10) Other Direct Project costs

Examples of costs for which a contribution can be considered include, but are not limited to:

a) Insurance (fire, theft, liability);
b) Standard, regular, day-to-day, operational, recurring costs related to:
(i) Basic telephone charges (including fax lines);
(ii) Postage and courier;
(iii) Monthly internet fees;
(iv) Operational printing contracted externally (business cards, letterhead, ad hoc unanticipated print jobs, minor updates and/or printing of organizational or program brochures, etc.);
(v) Equipment repair and maintenance (includes photocopy meter charges); and
(vi) Staff professional development - amount to cover basic training needs as per organization's existing policies; employment related requirements, which can include, but is not limited to, health and safety, first aid, cardiopulmonary resuscitation (CPR), self-defense, crisis intervention, anti-racism, anti-oppression, sensitivity, conflict resolution, etc..
c) Materials and supplies (e.g. pens, pencils, paper, envelopes, cleaning supplies, subscriptions);
d) Bank charges;
e) IT maintenance;
f) Other non participant-based costs (e.g. water where public water not safe for drinking, staff and volunteer recognition);
g) Staff and volunteer transportation (bus fare, taxi and parking required for delivery of project activities but not part of travel claims; does NOT include monthly parking fees; travel is noted in category 1A).

2. ORGANIZATIONAL INFRASTRUCTURE COSTS

Also known as centralized administrative costs, these are expenses incurred for "main office", "head office", or "administration office" type costs, which guide and enable effective program delivery and contribute to the success of the project by providing support through overall organization governance, management, planning, finance, communications, human resources and information technology. These are costs related to functions which are not project specific.

For example, wages/salaries and related office costs of management or other staff whose time is not spent specifically on management or delivery of project activities (i.e. CEO, HR department, Finance group, Administration section, etc.). Expenses associated with the project under this heading can be included in payments that are based on a formula.

11) Organizational Infrastructure Costs

Examples of costs for which a contribution can be considered include, but are not limited to:

a) Staff wages and MERCS;
b) Other employment-related benefit costs (WCB, medical, dental, pension, etc.) where warranted by current organizational HR policies;
c) Other HR costs such as extended illness and maternity leave, vacation leave pay out, severance pay, etc. where warranted by current organizational HR policies and provincial labour standards. (This is not a contingency option. Costs must be foreseeable to be negotiated in the original agreement and will otherwise require a negotiation and amendment when incurred.);
d) Rent, lease (including applicant owned premises) and minor repairs and leasehold improvements;
e) Utilities;
f) Furniture;
g) Signage;
h) Equipment purchase, lease or rental (including computers);
i) Costs associated with use of applicant-owned assets other than premises (e.g. computers and other equipment, furniture, etc.);
j) Equipment maintenance and repairs;
k) Software;
l) Professional fees - contracting (e.g. bookkeeping, janitorial services, IT, equipment maintenance services, security);
m) Audit costs;
n) Staff disability supports (duty to accommodate);
o) Telephone costs;
p) Postage and courier;
q) Internet costs (web page design, etc.) and other IT requirements;
r) Printing costs;
s) Advertising costs;
t) General insurance (e.g. directors' liability insurance);
u) Travel and transportation (including board members);
v) Training and development costs (volunteer and staff);
w) Office supplies;
x) Bank charges;
y) Memberships and affiliation fees (professional, inter- and intra-organizational, etc.).

3. NHI use only[1]

a. Pre-development costs

b. Capital Purchase: land & building

c. Capital Purchase: renovations

4. INELIGIBLE COSTS

Costs associated with fundraising activities;
- Fundraising is the process of soliciting and gathering money by requesting donations from individuals, businesses, charitable foundations, or governmental agencies. Service Canada cannot reimburse costs for projects designed to solicit funds to support the operations of a sponsor organization. Fundraising can include a number of activities, and if the program officer feels that a project is being undertaken for the purpose of generating funds to support the organization or organizational activities, these costs must be disallowed. Although there is no specific reference to fundraising in the operations guide and departmental policies this is in keeping with the Transfer Payment Policy requirement that the purpose of contribution funds cannot be to generate revenue.
Canada Revenue Agency or payroll penalties;
Parking tickets;
Parking passes
Food (in certain cases)
- Food is not typically an eligible expense except in the case of holding a conference, or for participant completion activities. In all cases, the negotiated amounts must be reasonable. Assessment of "reasonable" must be done on a case by case basis. It is "reasonable" to offer participants some modest nourishment, as they have been removed from their normal working environment and/or a working lunch is needed in order to keep the conference participants together in one location.
- A volunteer appreciation event differs in nature, objective, and scope from that of a conference held to support project activities. The conference is a working event and contributes to the achievement of project objectives, while a recognition or ceremonial type of event for volunteers does not directly contribute to project objectives in the same way.
Legal fees and court awards for inappropriate dismissal or other inappropriate/illegal activity;
Membership fees for privates clubs, etc. (golf clubs, gyms, etc.) unless part of existing (non-monetary) employment benefits package;
Staff salary bonuses if not originally negotiated into agreement;
Purchase of alcoholic beverages;
Purchase of any illegal substances;
Mentor wages (under Youth projects);
Unreasonable gifts or unreasonable payments for recognition;
Other costs ineligible as per program terms and conditions;

[1]These costs are to be categorized under 1A.

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