(a) Formula grant funds: The maximum time limit for the expenditure
of a given fiscal year allotment is three years from the effective date
of the Federal grant award to the State. The maximum time limit will be
allowed and will be specified in the Department's formula grant
document for each fiscal year of funds provided to the State. Any
remaining funds that have not been expended at the end of the
expenditure period must be returned to the Department in accordance
with the applicable closeout procedures for formula grants.
(b) Competitive grant funds: The maximum time limit for the
expenditure of these funds is three years from the effective date of
award, but will, in all cases, be determined by the grant period and
the terms and conditions specified in the Federal grant award agreement
(including any applicable grant modification documents). Any remaining
funds that have not been expended at the end of the approved grant
period must be returned to the Department in accordance with the
applicable closeout procedures for competitive grants (section
503(a)(5)(C)(vii)).