SPECIAL CONSTRUCTION ACCOUNTS
5.15
STATE PARK CONSTRUCTION ACCOUNT
NARRATIVE
A portion of the Highway User Tax Distribution (HUTD) is set aside to fund public accesses to outdoor
recreation areas within a county. These projects must be applied for and final projects are determined
through the Department of Natural Resources.
When a project is let a State Aid Payment Request can be submitted for 95% of the state park eligible
work. The remaining 5% is encumbered and will be paid when the project is complete and all costs are
verified. Upon final any unspent funds will need to be returned to State Aid. Since this is a special
allocation and not an annual allocation this cannot be applied to another project and you will be billed
for this overpayment. Any unspent funds that remain encumbered will be released back to the State
Park Fund.
ACCOUNTS NEEDED
(const exp)
(revenue)
(asset)
(asset)
(liability)
(liability)
- STATE PARK CONSTRUCTION EXPENSES
(there will be numerous construction accounts)
- STATE PARK CONSTRUCTION - REVENUE
- CASH
- STATE PARK CONSTRUCTION - RECEIVABLE
- CONTRACTS PAYABLE
- STATE PARK CONSTRUCTION - UNEARNED REVENUE
SEQUENCE OF EVENTS
PROJECT IS AWARDED
Once a State Park project is approved an encumbrance will be set up for the estimated project cost.
After the project is let the county can set up State Park Construction Receivable and State Park
Unearned Revenue Accounts. Refer to page 5.20, Example A, #1 for a graphic display of this entry.
Accounting Entry
Record State Park Receivable for awarded contract amount
Debit Account: (asset)
State Park - Receivable
Credit Account: (liability)
State Park - Unearned Revenue
Rev. 11/16
SPECIAL CONSTRUCTION ACCOUNTS
5.16
95% PAYMENT IS RECEIVED FOR THE PROJECT
After the initial SAPR has been approved you will receive the requested percentage payment, up to 95%
for the project. State Aid advances 95% of the total State Park Construction Obligation and the
remaining 5% remains encumbered. Refer to page 5.20, Example A,
To keep contract costs clear it is a good idea to make two entries if you are being paid for engineering,
force account work and/or Right of Way (ROW). #2A, & 2B for a graphic display of the following
entries.
Accounting Entry
Record receipt of State Park contract funds
Debit Account: (asset)
Credit Account: (asset)
Accounting Entry
Cash
State Park - Receivable
Record receipt of State Park engineering, force account and
ROW funds
Debit Account: (asset)
Cash
Credit Account: (revenue)
State Park Construction - Revenue
WORK BEGINS ON THE PROJECT
Work progresses and bond eligible items are certified. Payments are made to the contractor less retained
funds in the same manner as a regular construction project. The following entries will need to be made
to recognize the construction expense, earned State Park revenue, and the disbursement to the
contractor. Refer to page 5.20, Example A, #3A, 3B & 3C for a graphic display of the following
entries.
Accounting Entry
Recognize expense for work certified
Debit Account: (expense)
State Park Construction Expense
Credit Account: (liability)
Contracts Payable
Accounting Entry
Recognize State Park revenue for work certified
Debit Account: (liability)
State Park - Unearned Revenue
Credit Account: (revenue)
State Park Construction - Revenue
Accounting Entry
Record contractor disbursement
Debit Account: (liability)
Credit Account: (asset)
Rev. 11/16
Contract Payable
Cash
SPECIAL CONSTRUCTION ACCOUNTS
5.17
PROJECT IS FINALED
Numerous partial payments may be made to the contractor and SAPRs completed following the same
process as in the steps above. The final SAPR must indicate that the project is final and request any
remaining unpaid State Park funds equal to the value of eligible work certified or the State Park
allocation whichever is less. Upon final four main situations can occur relating to the State Park funds.
These are:
A)
B)
C)
D)
- Project is completed exactly as estimated
- Project overruns original estimate
- Project Underruns original estimate without a State Park overpayment
- Project Underruns original estimate with a State Park overpayment
A) PROJECT IS COMPLETED AS ESTIMATED
The remaining unpaid State Park funds are released to the county upon the receipt of the executed
SAPR. Refer to page 5.20, Example A, #6A and #6B for a graphic display of these entries.
Accounting Entry
Record receipt of State Park funds
Debit Account: (asset)
Credit Account: (asset)
Cash
State Park - Receivable
B) PROJECT OVERRUNS ORIGINAL ESTIMATE
The remaining State Park funds up to original encumbrance amount are released to the county upon the
receipt of the executed SAPR. If additional funds are requested and granted it is possible that the county
will receive additional State Park funds; if not the overage will be paid from local funds. Refer to page
5.21, Example B, #6 & 7 for a graphic display of these entries.
Accounting Entry
Recognize State Park work certified over original allocation
Debit Account: (liability)
State Park - Receivable
Credit Account: (revenue)
State Park - Revenue
Accounting Entry
Recognize expense greater than State Park allocation
Debit Account: (expense)
Construction Expense
Credit Account: (liability)
Contracts Payable
Accounting Entry
Record receipt of State Park contract funds
Debit Account: (asset)
Credit Account: (asset)
Rev. 11/16
Cash
State Park - Receivable
SPECIAL CONSTRUCTION ACCOUNTS
Accounting Entry
5.18
Record receipt of State Park engineering, force account or
ROW funds
Debit Account: (asset)
Credit Account: (asset)
Cash
State Park - Revenue
C) PROJECT UNDERRUNS ORIGINAL ESTIMATE WITHOUT OVERPAYMENT
The remaining State Park funds up to an amount equal to the value of eligible work certified are released
to the county upon the receipt of the executed SAPR, if no further State Park eligible costs remain any
retained funds will be released to the county. Refer to page 5.22, Example C, #6A, and #6B for a
graphic display of these entries.
Accounting Entry
Record underrun
Debit Account: (liability)
Credit Account: (asset)
Accounting Entry
State Park - Unearned Revenue
State Park - Receivable
Record receipt of State Park funds
Debit Account: (asset)
Credit Account: (asset)
Cash
State Park - Receivable
D) PROJECT UNDERRUNS ORIGINAL ESTIMATE WITH AN OVERPAYMENT
Upon the receipt of the executed SAPR, no further State Park eligible costs remain and the final State
Park eligible costs are less than the amount already paid to the county. These funds will have to be
repaid to the State Park fund. Refer to page 5.22, Example C, #6A, and #6B for a graphic display of
these entries.
Accounting Entry
Record underrun
Debit Account: (liability)
Credit Account: (asset)
Accounting Entry
State Park - Unearned Revenue
State Park - Receivable
Record repayment of State Park Funds
Debit Account: (asset)
Credit Account: (asset)
State Park - Receivable
Cash
Note: The State Park fund overpayments must be repaid by the county. They are not left as outstanding
overpayments and applied to future projects like regular allotment overpayments.
Rev. 11/16
SPECIAL CONSTRUCTION ACCOUNTS
5.19
FINAL PAYMENT TO CONTRACTOR
When the project is finaled and all the required documentation is received from the contractor,
the county will release the retained funds to the contractor. Refer to page 5.22, Example C, #6A, and
#6B for a graphic display of these entries.
Accounting Entry
Record disbursement to contractor
Debit Account: (liability)
Credit Account: (asset)
Rev. 11/16
Contracts Payable
Cash
SPECIAL CONSTRUCTION ACCOUNTS
EXAMPLES
Example A
Rev. 11/16
5.20
SPECIAL CONSTRUCTION ACCOUNTS
Example B
Rev. 11/16
5.21
SPECIAL CONSTRUCTION ACCOUNTS
Example C
Rev. 11/16
5.22
SPECIAL CONSTRUCTION ACCOUNTS
Example D
Rev. 11/16
5.23