Subrecipient Monitoring and Compliance for Federal Education Grants

Project Overview

After completing a desk review of the Maryland State Department of Education’s (MSDE) American Rescue Plan Act (ARPA) Coronavirus State and Local Fiscal Recovery Funds (SLFRF), Hagerty was asked to design and implement a broader subrecipient monitoring program informed by that initial approach.

Leveraging an established partnership and a strong understanding of MSDE’s objectives, Hagerty delivered a comprehensive monitoring effort spanning multiple federal funding streams—including the Elementary and Secondary School Emergency Relief (ESSER), Governor’s Emergency Education Relief Fund (GEER), Coronavirus Relief Fund (CRF), SLRF, and Maryland Leads Initiative. Our goal was to translate complex federal requirements into a consistent and scalable monitoring experience while remaining responsive to each subrecipient’s unique context.

Understanding the Mission

MSDE’s objective extended beyond a one-time review. The department aimed to help subrecipients understand what compliance looks like in practice, assess their current posture, and take corrective actions that would withstand future audits. Hagerty worked closely with MSDE to make the process practical and accessible. This included providing plain-language guidance, structured templates, and ongoing support throughout the engagement.

Rather than focusing solely on data collection, the program emphasized direct support to subrecipients. It helped them self-assess against federal requirements, identify gaps, and strengthen internal controls and documentation. This focus on audit readiness and continuous improvement ensured subrecipients were better prepared not only for eventual audits, but for long-term federal grant management.

The Hagerty Approach

Hagerty implemented a two-phase monitoring framework tailored to the specific compliance requirements of each funding stream while remaining adaptable to each organization’s needs. Our approach combined programmatic and fiscal monitoring surveys aligned with federal and program-specific criteria. It also included targeted expenditure sampling to validate allowability, documentation, and consistency with stated program activities.

To support engagement and clarity, Hagerty facilitated kickoff briefings, conducted monitoring interviews, and issued focused requests for information when necessary. The team provided Preliminary Monitoring Results to subrecipients, with opportunities for clarification, before issuing Final Monitoring Reports, promoting both accuracy and shared understanding.

A defining feature of the project was its emphasis on capacity building. Hagerty began by assessing each organization’s readiness to participate in monitoring and implement corrective actions. The team then calibrated expectations, timelines, and support accordingly. Built-in feedback loops enabled a responsive, user-centered approach—providing practical tools, examples of compliant submissions, and real-time guidance. These efforts improved participation, elevated the quality of submissions, and strengthened consistency across the monitoring program.

Achieving Results

The monitoring engagement delivered clear, actionable findings that subrecipients could implement immediately while also building long-term systems and practices. Notably, sampled transactions showed no evidence of unallowable expenditures, reinforcing the value of early validation and clear documentation standards. Subrecipients gained a stronger understanding of required documentation, corrective actions, and compliance timelines. MSDE also received a structured transition plan to support post-closeout follow-through, including examples of compliant materials.

Most importantly, the project drove lasting outcomes beyond a single project cycle—improving audit readiness through organized documentation, strengthening internal controls with defined roles and repeatable procedures, and enhancing capacity for ongoing federal grant management. The result was a scalable, replicable monitoring model that positions MSDE and its partners for future program success.