The Governor of the State of California has issued Executive Order S-09-09 effective as of this date, June 8, 2009. This order directs all state funds encumbered on or after March 1, 2009, for contracts entered into for which goods or services have not been provided or for contracts proposed to be entered into during the 2008-2009 fiscal year by State agencies and departments, regardless of funding source, to be disencumbered. These funds are to revert to their original funding source with no legal liability to be incurred by the State.
This order does not include projects funded by the American Recovery and Reinvestment Act (ARRA). It also appears to exclude projects funded by bonds and other state-supported projects meeting certain funding criteria, but the full scope and application of the Governor’s order are unclear at this time. The Sponsored Projects Office therefore encourages all campus units with state-supported sponsored projects to immediately cease encumbering funds and to inform all subcontractors to do the same.
SPO is seeking additional guidance from the UC Office of the President and will provide the campus community with additional information as it becomes available.