2. Project Funding

Funds utilized for capital improvements may be from many sources including state appropriations, revenue bond issues, capital improvement funds from Arkansas Development Finance Authority, institutional reserves, and gifts and grants.

A Method of Finance shall be prepared in accordance with Arkansas Code Annotated 19-4-1407 (Appendix 4).

The request for approval of the Method of Finance (Appendix 5) shall be prepared by the institution using estimates normally furnished by the design professional. Pertinent information on appropriations and fund codes, a concise description of the project, the estimated total project cost, and the estimated dates of commencement and completion must be accurately presented on the Method of Finance before submission. Upon completion, the MOF is forwarded to the Office of the Vice President for Finance and Administration for review .

Method of Finance (MOF’s) Less than $250,000: MOF’s less than $250,000 cash funds are logged in and reviewed by the Arkansas Department of Higher Education and then signed by ADHE’s Senior Associate Director of Institutional Finance. After signature, the MOF is routed to the Arkansas Department of Finance and Administration (DFA) and signed by DFA’s Assistant Administrator.

Method of Finance (MOFs) $250,000 or More: Per Arkansas Code Annotated 22-9-104, MOF’s with cash funds of $250,000 or more are logged in and reviewed by ADHE and then signed by ADHE’s Senior Associate Director of Institutional Finance. After signature, the MOF is routed to DFA and then sent to the ALC Review Committee prior to being signed by DFA.

*No construction may begin until an MOF has been signed by DFA; please see all related Arkansas Codes and ADHE procedure reminders: ADHE MOF Procedures Issued June, 2011 (Appendix 6).

Changes in project costs or changes in funding sources may require a revision to the Method of Finance. Contractor contracts, change orders, and amendments to professional services contracts cannot be approved, if sufficient funds are not available on the Method of Finance. Revised MOF’s shall be submitted, approved and distributed in the same manner as the initial Method of Finance and shall reflect the same number as the original with a capital alpha suffix.