2015 AGED CARE APPROVALS ROUND - ESSENTIAL GUIDE

CHAPTER 5 – CAPITAL GRANT PROGRAM GUIDELINES

RURAL, REGIONAL AND OTHER SPECIAL NEEDS BUILDING FUND – PROGRAM GUIDELINES 2015

A. IntroductionThe Rural, Regional and Other Special Needs Building Fund (the Fund) is administered by the Department of Social Services (the Department). It provides capital grants for the construction or upgrade of residential aged care buildings:

in rural, regional and remote areas of Australia; and/or which specifically focus on the provision of residential aged care to people from special needs

groups or concessional, supported, assisted or low-means residents (as defined under the Aged Care Act 1997 (the Act)), including in major cities; and/or

in a location where there is a demonstrated need for additional residential aged care services.

Capital grants are only available to organisations that cannot afford to fund the proposed capital works without a grant from the Australian Government.

The Fund operates under the provisions of Part 5 of the Act, and the Residential Care Grant Principles 1997 (the Principles).

Up to $67 million in capital grants is available under the Fund for allocation through the 2015 Aged Care Approvals Round (ACAR). This includes approximately $11.5 million that has been earmarked to support access to residential aged care for older people from culturally and linguistically diverse communities (CALD).

In line with the Australian Government’s commitment to addressing homelessness, in the 2015 ACAR the Government is aiming to provide a capital grant for at least one new specialist residential aged care facility for people who are homeless or at risk of homelessness.

Applicants may apply for a capital grant only or an allocation of residential aged care places plus a capital grant. To apply for a capital grant only - you must use the ‘Residential Aged Care Places’ application form, completing Part A once for your organisation and Part C for each service where you are seeking a capital grant. To apply for both residential aged care places and a capital grant – you must use the ‘Residential Aged Care Places’ application form, completing Part A once for your organisation, Part B for each service for which you are seeking residential aged care places and Part C for each service where you are seeking a capital grant.

B. Purpose of this sectionThese guidelines are designed to provide details of the Fund and its operation for prospective capital grant applicants in the 2015 ACAR, including information about the activities for which capital grants are available, who can apply, how applications will be assessed, how to lodge an application and what successful applicants need to do.

These guidelines may be revised and updated for future ACARs.

As noted above, the Fund operates under the provisions of the Act and the Principles. Should these guidelines be inconsistent with the provisions of the Act or Principles in any way, the Act and the Principles will prevail.

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C. Aim, objective and outcomes of the FundThe overall aim of the Fund is to facilitate equitable access to residential aged care across Australia.

The Fund’s objective is to provide capital grants to facilitate equitable access to residential aged care where access is impeded by virtue of:

geographic location; and/or inadequate supply of residential aged care, including for people with special needs (as defined

in the Act and Principles); and lack of access to sufficient non-grant funding by an approved provider.

The main outcomes delivered by the Fund are new residential aged care buildings, and the upgrade of existing residential aged care buildings which, without the assistance of capital grants provided under the Fund, would otherwise not be available.

ELIGIBILITY AND ASSESSMENT FRAMEWORK

D. Overview of the grant eligibility and assessment frameworkAll valid applications received by the Department (see Chapter 1 of the 2015 ACAR Essential Guide) will undergo a formal assessment process, undertaken by the Department in accordance with the provisions of the Act and the Principles.

In order to be considered for a grant, applicants must first satisfy the threshold criteria outlined in point E below.

Applications which meet these threshold criteria will be then assessed by the Department on a competitive basis (see point F below).

Based on this competitive assessment process, the Department will award grants to those applications which best meet the needs of people from special needs groups, giving priority to those applications which demonstrate the best value for money for the Australian Government and the most urgent need (see point F below).

All decisions on the assessment and allocation of capital grants are taken by the Department. The Assistant Minister for Social Services has no involvement in the decision to award a capital grant.

E. Threshold eligibility criteriaIn order to be considered for a grant, applications must meet threshold criteria in relation to:

the eligibility of the project for which a grant is being sought; and the eligibility of the organisation seeking a grant.

1.1 Eligible project criteriaAs set out in Section 20 of the Principles, capital grants will only be provided for capital works projects which provide or upgrade accommodation for:

a majority of care recipients who are (or will be) peopleo from Aboriginal and Torres Strait Islander communitieso from non-English speaking backgrounds (that is, culturally and linguistically diverse

backgrounds)o who live in rural or remote areaso who are financially or socially disadvantagedo who are veteranso who are homeless, or at risk of becoming homelesso who are care-leaverso who are parents separated from their children by forced adoption or removalo from the lesbian, gay, bisexual, transgender and intersex (LGBTI) community

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o who are concessional, assisted or supported residents (as defined under Schedule 1 of the Act;

people who live in a location where there is a demonstrated need for additional residential aged care service

people who do not live in a major** city.

In addition, projects are not eligible for a grant for capital works if they have been contracted, commenced, or completed prior to the execution of a Deed of Agreement or are located at a residential aged care service with Extra Service Status (as defined under s 72-1(4) of the Act).

Further information about the costs that can be covered by a capital grants project and the costs that may not be covered are included below in parts 1.2 and 1.3.

1.2 What costs can be covered by a capital grant?As set out under Section 70-3 of the Act, capital grants can be used to fund:

the acquisition of land; the acquisition, construction, extension or alteration of premises; and/or furniture, fittings and equipment.

1.3 What costs are not covered by a grant?Capital grants may not be used to fund costs arising from:

routine administration of a service, whether or not the costs are related to the proposed capital works

acquiring and operating vehicles rent, insurance and state and local government statutory charges (for example, rates) any taxation payable by the service, including any tax which is payable as a result of receiving

the grant interest costs, costs associated with obtaining finance and costs relating to other work

undertaken by the Grantee.

2. Applicant threshold criteriaIn order to be eligible for a capital grant, an applicant must be able to:

demonstrate its ongoing financial and organisational viability demonstrate that it does not have the capacity to fund all or part of the project without a capital

grant if it is already an approved provider or has been an approved provider, demonstrate that it has

a very good record, or a demonstrated commitment to improvement, in its conduct as an approved provider.

Further information about these criteria is outlined below in points 2.1 and 2.2.

Before a capital grant is awarded an applicant must also be an approved provider and have an allocation of residential aged care places (see point 2.3).

Capital grants are not available to State or Territory governments or an authority of a State or Territory.

** “Major city” is defined using the Australian Standard Geography Standard (ASGS): Volume 5 - Remoteness Structure, July 2011, produced by the Australian Bureau of Statistics (s 20.3 of the Principles). Major cities are Sydney, Newcastle, Wollongong, Melbourne, Geelong, Brisbane, Sunshine Coast, Gold Coast–Tweed Heads, Perth, Adelaide and Canberra–Queanbeyan. Maps identifying remoteness area boundaries in each state and territory are available from the Australian Bureau of Statistics (ABS) website. Alternatively, the ABS may be contacted by email (geography@abs.gov.au) with the subject line "Postcode to Remoteness Areas 2011." Provide the ABS with your town/suburb name and postcode and it will provide details of the remoteness classification for the location.

2.1 Demonstrated ongoing financial and organisational viability and lack of capacity to fund all or part of the project without a residential care grant

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In order to be eligible for a grant, the Department must be satisfied that the applicant is financially viable (and so will be able to continue to deliver aged care into the future).

The Department must also be satisfied that the applicant is unable to fund the proposed capital works without the assistance of a capital grant.

Assessment against these eligibility criteria will take account of information provided in the application and any other information available to the Department from its internal records or available publicly.

The information provided by applicants may be assessed by an independent financial analyst to assist the Department in coming to a view about:

the financial viability, sustainability and overall robustness of the financial situation of the applicant organisation and service

sensitivity of the applicant’s debt servicing capacity to interest rate fluctuations the applicant’s use of accommodation bonds, refundable accommodation deposits, refundable

accommodation contributions and other sources of funding the applicant’s capacity to complete any capital works associated with the proposal with or

without a capital grant, taking into account all possible sources of funding including debt finance.

2.2 Conduct as an approved providerIf the applicant is an existing approved provider, the Department will consider previous and current non-compliance (including but not limited to sanctions and notices of non-compliance) at any service operated by the approved provider. Non-compliance will also be considered in relation to services operated by related approved providers. Approved providers may be regarded as related if they have key personnel in common.

The matters the Department will consider in determining the past conduct of an approved provider or a related approved provider include, but are not limited to:

the nature of the non-compliance the recency of the non-compliance the frequency of any non-compliance the timing and effectiveness of the response to the non-compliance the extent of the non-compliance across services operated by the approved provider or

services operated by related approved providers the current period of accreditation for the approved provider’s services whether an applicant has demonstrated a commitment to improvement in relation to its conduct

as a provider through the extent to which the response to any non-compliance was sustained over time.

In addition to these matters, the Department may also consider other aspects of an approved provider’s past conduct record such as any past history in meeting conditions attached to an allocation of places, a capital grant or a zero real interest loan.

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2.3 Approved provider statusAn applicant does not need to be an approved provider at the time it applies for a capital grant, but it does need to have been approved as a provider and have an allocation of residential aged care places before a grant can be allocated.

Further information on how to become an approved provider can be accessed at the following webpage link, Approved Provider Information.

F. Competitive AssessmentApplications which meet the threshold eligibility criteria set out in point E will be assessed by the Department on a competitive basis, consistent with the provisions of the Act and the Principles. Specifically, Section 72-3 of the Act and Sections 20.6 and 20.7 of the Principles set out the matters that the Department will consider in assessing, and then prioritising, applications for capital grants.

Grants will be awarded for those proposals which are assessed by the Department as best meeting the needs of people with special needs, with priority given to those proposals which demonstrate best value for money for the Commonwealth and the most urgent need to improve or maintain access to residential aged care.

1.1 Matters that will be considered during competitive assessmentIn assessing the extent to which each proposal meets the needs of people with special needs the Department will consider:

the proportion of care recipients who will be supported, concessional, assisted or low-means care recipients

the location of the aged care service, and particularly whether it is in a rural or remote area the availability of other aged care services in the area the need for the grant whether there is an urgent need for the grant due to unforeseen circumstances whether the project meets the needs of care recipients living with dementia whether the project provides high quality accommodation for current or future care recipients whether the project offers significantly improved operational efficiency whether appropriate arrangements will be put in place for the provision of care to care

recipients or other people while the project is being carried out.

Proposals which address a general lack of access to residential aged care in a location where there is a demonstrated need for additional residential aged care services (for example, regions where the ratio of residential aged care places per 1,000 people aged 70 or over is significantly below the national average) may also be regarded as addressing a lack of access for people with special needs.

These criteria are not weighted, but rather are matters that must be considered by the Department when assessing which applications, on balance, demonstrate the greatest case for support.

G. Priority for grantsBased on the outcomes of the competitive assessment process (and consistent with Section 72-3 of the Act and Sections 20.6 and 20.7 of the Principles), the Department will award grants for those proposals which best meet the needs of people with special needs, with priority given to those proposals which, on balance:

meet the most urgent need for building, rebuilding, renovation or restoration work to be carried out in order to improve or maintain access to residential aged care, including meeting changing care needs arising from increased frailty of care recipients and the increased prevalence of dementia; and

offer the Commonwealth the best value for money compared with other projects for which applications for residential aged care grants have been made.

1.1 Priority for at least one service addressing homelessnessAdditionally, in line with the Government’s commitment to addressing homelessness, in the 2015 ACAR the Government is aiming to provide a capital grant for at least one new specialist residential aged care facility for people who are homeless or at risk of homelessness. Applicants seeking funding for a specialist residential aged care service for people who are homeless or at risk of becoming homeless should ensure that their proposal demonstrates:

why the applicant wishes to establish a specialist residential aged care service for people who are homeless, or at risk of becoming homeless in the chosen location

the need for the specialist residential aged care service for people who are homeless, or at risk of becoming homeless, in light of existing services for older people who are homeless, or at risk of becoming homeless, in the area

the applicant organisation’s knowledge and understanding of the particular aged care needs of older people who are homeless, or at risk of becoming homeless

the track record of the applicant organisation in the provision of care and services to older people who are homeless, or at risk of becoming homeless which meet the needs of this special needs group and/or established relationships with organisations that provide care and services to older people who are homeless, or at risk of becoming homeless.

1.2 Priority for Culturally and Linguistically Diverse Communities (CALD)Approximately $11.5 million has been earmarked to support access to residential aged care for older people from culturally and linguistically diverse communities (CALD).

Applicants seeking funding for a specialist residential aged care service for people from a CALD community should ensure that their proposal demonstrates:

why the applicant wishes to establish a specialist residential aged care service for people from a CALD community in the chosen location

the need for the specialist residential aged care service for people from a CALD community, in light of existing services for older people who are from a CALD community in the area

the applicant organisation’s knowledge and understanding of the particular aged care needs of the CALD community

the track record of the applicant organisation in the provision of care and services to the CALD community which meet the needs of this special needs group and/or established relationships with organisations that provide care and services to older people from the CALD community.

HOW TO LODGE AN APPLICATION

H. Application processIn order to apply for a capital grant under the Rural, Regional and Other Special Needs Building Fund through the 2015 ACAR:

an applicant must complete the approved ACAR application form; the applicant must include all required attachments; and the application must be received electronically by the Department on or before

11.59pm (AEST) on 25 September 2015.

You are required to submit your applications and associated attachments via email at acar@dss.gov.au . For further details please refer to Chapter 1 of the 2015 ACAR Essential Guide.

You are required to submit ONE signed copy of your application as part of your electronic lodgement to the above email address.

Please note, however, that should an applicant wish to hand sign or affix their company seal on the Part A endorsement page of their application, applicants are able to send that page as a PDF. The rest of the completed application form should be submitted in the correct Microsoft Word ‘doc’ file format (see Chapter 1 of the 2015 ACAR Essential Guide for further detail).

Please note: Applications will not be accepted by facsimile. Late or incomplete applications may not be accepted. Attach documents only where required or requested, other documents will not be considered. The Department will only accept paper applications in exceptional circumstances. Please

contact the Department at acar@dss.gov.au. Evidence to support this may be required. Applications for places may be deemed invalid if the application is made using a form other

than those available on the Department’s website. Applicants are not permitted to edit the application forms. If you are unable to complete the application forms provided, contact the ACAR Team for further advice at: (acar@dss.gov.au).

Ensure your application is received within the Department on or before:

11.59pm (AEST) 25 September 2015

Late applications: It is the sole responsibility of the applicant to ensure that the application is received by the due closing time and date. An application that is received after the closing date may be regarded as invalid and not assessed. Applicants are responsible for providing information based on thorough research and analysis of all aspects of the capital works proposal, including any associated building costs and the current and future financial capacity of the applicant organisation.

Notification of any changes: Applicants should notify the Department of any change that will significantly affect their capacity to implement their proposal; for example, financial capacity, costs of the project and availability of land. Notification should be made as soon as any such change becomes evident. This must be in writing and sent to the same email address as used for the lodgement of the application.

False or misleading information: Giving false or misleading information is a serious offence. An approval based on false or misleading information may later be revoked.

Waiver: In certain circumstances, the Secretary may waive the requirement for a valid application to have been made in response to a public invitation to apply. These circumstances are set out in Section

72-5 of the Act. If the Secretary waives the requirements for a valid application in response to an Invitation to Apply, all other eligibility and assessment criteria will apply.

I. Information which will be considered by the Department in assessing an applicationIn assessing each application against the threshold eligibility criteria and the competitive assessment criteria the Department:

will consider the information provided in the application; will consider the application in the light of the requirements of:

o the Acto the Aged Care Principles

may consider any other relevant information available to the Department including, but not limited to information from:o the Aged Care Complaints Schemeo the Australian Aged Care Quality Agencyo organisations able to undertake independent financial analysis and credit/debt

investigationso material provided to the Department through other processeso publicly available sourceso data about existing aged care service provision in a particular region.

INFORMATION FOR SUCCESSFUL APPLICANTS

J. Information for successful applicantsGrants will be awarded consistent with the following arrangements.

1.1 Grant AmountA grant may be allocated which is less than the grant sought. In deciding the amount of the grant, the Department will consider the cost of the project and the extent to which the applicant has a demonstrated lack of capacity to fund the proposed works, taking into consideration all possible sources of finance.

In the 2014 ACAR, 25 capital grants were allocated with grant amounts ranging from $104,000 to $19,093,000.

1.2 Publication Successful grant applicants will be published on the Department’s website. Each grant applicant will be advised in writing of the result of its application and will be provided with an opportunity to obtain a debrief on the application.

1.3 Requirements for successful applicantsA range of conditions and requirements will apply to all capital grants (as set out below under 1.3.1 to 1.3.10)

1.3.1 Deed of AgreementSuccessful applicants will be required to enter into a legally binding Agreement with attached Conditions applying to the grant.

A copy of the Agreement and Conditions for capital grants is available on the Department’s website at www.dss.gov.au/2015ACAR.

Applicants should note that, subject to certain thresholds, the Building Code 2013 (the Code) and the Building and Construction WHS Accreditation Scheme (the Scheme), will apply to the proposed capital works project and will be reflected in the Agreement and Conditions. Information on the Building Code and the Scheme is available on the Department of Employment’s website. For information on the Code refer to the following webpage link, Building Code Information.

For information on the Scheme refer to the following webpage link, Federal Safety Commission - Guidance.

Queries concerning the Building Code 2013 can be directed to: the Building Code Hotline: 1300 731 293, or the Building Code Mailbox: building@employment.gov.au

Any specific conditions that are attached to the offer of a grant or identified during the contract negotiations will be identified as specific conditions attached to the Agreement. The Grantee’s minimum financial contribution to the capital works project will be included as a condition of the grant.

1.3.2 Ownership of landFunding will be provided to applicants only where the lessor:

agrees to the proposal guarantees operation of the premises as a residential aged care service for a period of up to

20 years following the completion of the capital works.

These conditions will form part of the Agreement and Conditions and require a Deed of Acknowledgement between the lessor and the Commonwealth.

1.3.3 Payment ArrangementsThe Conditions of Grant set out the requirements for payment of the grant. Grants are paid in instalments on the achievement of construction milestones and the provision of documentary evidence of their achievement. Copies of supplier invoices are required to demonstrate expenditure.

1.3.4 Reporting RequirementsUnder the Conditions of Grant, the grantee is required to make periodic reports to the Department on the progress of the capital works project for which the grant was allocated.

1.3.5 Varying the Conditions of GrantA grantee can apply to the Secretary at any time to vary a condition attached to the Agreement. It is the grantee’s responsibility to apply for a variation prior to breaching any grant condition.

1.3.6 Breach of the Conditions of GrantWhere the conditions of the grant are not met, the Secretary may vary or revoke the grant. The grantee will be given an opportunity to make a submission on the matter before any decision to vary or revoke a grant is made.

1.3.7 Grant reductionThe grantee is expected to meet its contribution to the capital works project even if total expenditure on the project is less than the amount stipulated in the Agreement. In this circumstance, the grant will be reduced to the point that the grantee meets its minimum contribution requirement.

1.3.8 Grant increaseGrants cannot be increased in any circumstance, although an additional grant may be applied for through a future competitive ACAR. However, no grant will be made in respect of any project which has commenced, been contracted or has been completed.

1.3.9 Ongoing responsibilities A condition of any grant is that the grantee continues to provide residential aged care, funded under the Act, for a specified period after completion of the building constructed with the assistance of a grant.

If the grantee stops providing residential aged care in the building, or sells, transfers or demolishes the building, the Department can require all or part of the grant to be repaid.

Any grantee which intends to cease providing care in the building, to transfer ownership or effective control, or to sell, demolish or otherwise dispose of the building, should advise the Department at the earliest opportunity.

Further information on decisions to seek repayment of all or part of a grant is set out in the Recovery of Aged Capital Funding guidelines at the Department’s website.

1.3.10 Capital funding and Extra Service StatusIf Extra Service Status is granted in relation to a service which has been the recipient of a capital grant, there is a requirement to repay any Residential Care Grant in accordance with s 43-6 of the Act. This is the case even if the grant was allocated to an approved provider which does not own the service at the time Extra Service Status is granted.

FURTHER INFORMATION AND OTHER MATTERS

K. Further informationApplicants requiring additional information must put their queries concerning the 2015 ACAR in writing to the Department at acar@dss.gov.au.

The Act and the Principles are also available on the Attorney-General’s Department website and can be accessed at the following webpage link, www.comlaw.gov.au.

Contractual arrangements An application is not evidence of a contract or other form of legal agreement. Capital grants will not be made available for capital works which have been contracted, commenced, or completed prior to the execution of the Agreement.

Applicants who enter into contractual arrangements with other parties, before the execution of a Deed of Agreement, do so at their own risk.

Applications may be used for other purposesInformation contained in an application submitted in the 2015 ACAR may be used by the Department for other purposes, including as part of the assessment of applications in other processes. Any such use is at the sole discretion of the Department of Social Services and in accordance with the relevant provisions of the Act.

Review Rights:

The decision about the allocation of residential care capital grants through the ACAR are made by the Secretary or the Secretary’s delegate. This is not a reviewable decision under the Act (s 85-1) and decisions are therefore not reviewable by the Administrative Appeals Tribunal.

Decisions on the allocation of residential care grants are decisions for the purposes of the Administrative Decisions (Judicial Review) Act 1977.

Program EvaluationThe program will be evaluated as part of the close monitoring, review and refinement incorporated in the Government’s ten year plan for aged care reform.

Disclaimer

These guidelines do not constitute legal advice and should not be relied upon as such. The Department does not guarantee the accuracy or completeness of these Guidelines. You should obtain appropriate independent and professional advice relevant to your own circumstances in relation to the matters discussed in these guidelines. The Australian Government does not accept any liability (in negligence or otherwise) resulting from the use of, or reliance on, these guidelines.

These guidelines do not supersede any contractual agreements between the Department of Social Services and a recipient of a residential care capital grant.

In cases of discrepancy between these guidelines and the legislation, the legislation will prevail.