Statewide cost‑allocation plan shifts central service costs across funds, officials say

BOISE, Idaho — Jared Tetrault, a budget analyst with the Legislative Services Office, told the Joint Finance and Appropriations Committee on Jan. 7 that the Statewide Cost Allocation Plan (SWICAP) explains how central service costs are recovered across state agencies and fund sources.

Tetrault said SWICAP is a document the Division of Financial Management prepares and submits to the federal cognizant agency (HHS in Idaho) to show how the state will allocate central service costs fairly. “SWICAP in the budget…is an actual document that the division of financial management puts together that they send off to our federal authorizing entity,” he said.

How it works: The plan allocates recoverable costs for central service providers — the Office of the Attorney General, the Office of the State Controller and the Office of the State Treasurer — based on measures such as billable hours, active payroll employees, and number of warrants issued. The plan also adjusts appropriations for direct‑billing agencies such as Risk Management, Building Services and the Office of Information Technology Services.

Two‑year timing and budget implications

Tetrault explained that SWICAP operates on a two‑year lag: appropriations provided in one fiscal year are reconciled against actual usage, and adjustments for recovery appear in budget decisions two years later. He said the committee will see only net changes in agency budgets while the detailed calculations are administered by DFM.

Representative figures discussed

Tetrault walked members through recent dollar examples used to illustrate the mechanics of recovery. He said most controller and treasurer costs are recovered and about 80% of Attorney General centralized costs are recovered back to the general fund in the reconciliation process, though the criminal division and other exceptions are excluded.

Direct billings and items to watch

Direct billings included in agency budgets cover insurance, building rent and information technology services. Tetrault said the Legislative Services Office audit billing is expected to drop from about $1.5 million to $1.1 million based on current calculations, and that risk‑management billings were projected to decline in the current cycle.

Tetrault urged committee members to ask for additional details when an agency's SWICAP adjustments appear in that agency’s budget pages; the calculation details are prepared by the Division of Financial Management and included in budget materials.

Ending

Tetrault said the SWICAP process ensures each fund and agency pays a fair share of central service costs and that DFM forwards recovered amounts to the state’s general fund. He told members he will provide a more detailed percentage breakdown to the committee when the legislative staff can compile a report.