Guidance for Grants and Agreements
| Published date | 22 January 2020 |
| Citation | 85 FR 3766 |
| Record Number | 2019-28524 |
| Section | Proposed rules |
| Court | Management And Budget Office |
Federal Register, Volume 85 Issue 14 (Wednesday, January 22, 2020)
[Federal Register Volume 85, Number 14 (Wednesday, January 22, 2020)]
[Proposed Rules]
[Pages 3766-3809]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-28524]
[[Page 3765]]
Vol. 85
Wednesday,
No. 14
January 22, 2020
Part II Office of Management and Budget-----------------------------------------------------------------------2 CFR Parts 25, 170, 183, and 200Guidance for Grants and Agreements; Proposed Rule
Federal Register / Vol. 85 , No. 14 / Wednesday, January 22, 2020 /
Proposed Rules
[[Page 3766]]
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OFFICE OF MANAGEMENT AND BUDGET
2 CFR Parts 25, 170, 183, and 200
[2019-OMB-0005]
Guidance for Grants and Agreements
AGENCY: Office of Federal Financial Management, Office of Management
and Budget.
ACTION: Proposed Guidance.
-----------------------------------------------------------------------
SUMMARY: The Office of Management and Budget is proposing to revise
sections of Title 2 of the Code of Federal Regulations (CFR) Subtitle
A-OMB Guidance for Grants and Agreements. The proposed revisions are
limited in scope to support implementation of the President's
Management Agenda, Results-Oriented Accountability for Grants Cross-
Agency Priority Goal (Grants CAP Goal) and other Administration
priorities; implementation of statutory requirements and alignment of 2
CFR with other authoritative source requirements; and clarifications of
existing requirements in particular areas within 2 CFR. These proposed
revisions are intended to reduce recipient burden, provide guidance on
implementing new statutory requirements, and improve Federal financial
assistance management, transparency, and oversight.
DATES: Comments are due on or before March 23, 2020.
ADDRESSES: Comments on this proposal must be submitted electronically
before the comment closing date to www.regulations.gov. In submitting
comments, please search for recent submissions by OMB to find docket
OMB-2019-0005, which includes the full text of the proposed revisions
and submit comments there. Please provide clarity as to the section of
the guidance that each comment is referencing by beginning each comment
with the section number in brackets. For example; if the comment is on
2 CFR 200.1 include the following before the comment [200.1]. The
public comments received by OMB will be a matter of public record and
will be posted at http://www.regulations.gov. Accordingly, please do
not include in your comments any confidential business information or
information of a personal-privacy nature. To reference the track
changes of the proposed revisions please visit https://www.performance.gov/CAP/grants/. In general, responses to the comments
will be summarized and included in the preamble of the final guidance.
FOR FURTHER INFORMATION CONTACT: Nicole Waldeck or Gil Tran at the OMB
Office of Federal Financial Management at 202-395-3993.
SUPPLEMENTARY INFORMATION:
Background and Objectives
In 2013, OMB partnered with the Council on Financial Assistance
Reform (COFAR) to revise and streamline guidance to develop the Uniform
Administrative Requirements, Cost Principles, and Audit Requirements
for Federal Awards (Uniform Guidance) located in Title 2 of the Code of
Federal Regulations (2 CFR 200) (79 FR 78589; December 26, 2013). The
intent of this effort was to simultaneously reduce administrative
burden and the risk of waste, fraud, and abuse while delivering better
performance on behalf of the American people. Implementation of the
Uniform Guidance became effective on December 26, 2014 (79 FR 75867,
December 19, 2014) and must be reviewed every five years in accordance
with 2 CFR 200.109. Based on feedback and ongoing engagement with the
grants management community, the current Administration established the
Results-Oriented Accountability for Grants Cross Agency Priority Goal
(Grants CAP Goal) in the President's Management Agenda on March 20,
2018 (available at: https://www.performance.gov/CAP/grants/). The
Grants CAP Goal recognizes that grants managers report spending a
disproportionate amount of time using antiquated processes to monitor
compliance. Efficiencies could be gained from modernization and grants
managers could instead shift their time to analyze data to improve
results. To address this challenge, the Grants CAP Goal Executive
Steering Committee (ESC), which reports to the Chief Financial
Officer's Council (CFOC), identified four strategies to work toward
maximizing the value of grant funding by developing a risk-based, data-
driven framework that balances compliance requirements with
demonstrating successful results for the American taxpayer.
1. Strategy 1: Standardize the Grants Management Business Process and
Data
2. Strategy 2: Build Shared IT Infrastructure
3. Strategy 3: Manage Risk
4. Strategy 4: Achieve Program Goals and Objectives
To support these four strategies, various revisions are proposed
for 2 CFR. In support of Strategies 1 and 2, OMB is proposing changes
to terminology throughout 2 CFR. These proposed changes would help
ensure that there are no conflicts within 2 CFR and the Grants
Management Federal Integrated Business Framework (available at: https://ussm.gsa.gov/fibf/). This effort recognizes that recipient reporting
burden is reduced when the grants management business process and data
elements are standardized. OMB is also proposing revisions to
strengthen the governmentwide approach to performance and risk, to
support efforts under Strategies 3 and 4 by encouraging agencies to
measure the recipient's performance in a way that will help Federal
awarding agencies and non-Federal entities to improve program goals and
objectives, share lessons learned, and spread the adoption of promising
performance practices.
OMB is also proposing revisions to 2 CFR to implement relevant
statutory requirements. These revisions include requirements from
several National Defense Authorization Acts (NDAAs) and the Federal
Funding Accountability and Transparency Act (FFATA), as amended by the
Digital Accountability and Transparency Act (DATA Act).
Finally, OMB is proposing revisions to 2 CFR to clarify areas of
misinterpretation. The proposed revisions are intended to reduce
recipient burden by improving consistent interpretation.
OMB proposes these revisions after consultation and in
collaboration with agency representatives identified by the Grants CAP
Goal ESC. In addition, OMB solicited feedback from the broader Federal
financial assistance community and made changes to the proposed
revisions as appropriate.
In summary and as discussed further in the sections below, OMB
proposes revisions to 2 CFR parts 25, 170, and 200 within the below
scope. Additionally, OMB proposes adding part 183 to 2 CFR to implement
Never Contract with the Enemy.
I. To support implementation of the President's Management Agenda
Results-Oriented Accountability for Grants CAP Goal and other
Administration priorities;
II. To meet statutory requirements and to align with other
authoritative source requirements; and
III. To clarify existing requirements.
I. Support Implementation of the President's Management Agenda and
Other Administration Priorities
A. Changes to the Procurement Standards To Better Target Areas of
Greater Risk and Conform to Statutory Requirements
To better target 2 CFR requirements on areas of greater risk, and
consistent
[[Page 3767]]
with the intent of the Grants CAP Goal, OMB proposes allowing all
Federal recipients the flexibility provided in the NDAA for 2017 for
institutions of higher education, related or affiliated nonprofit
entities, nonprofit research organizations, and independent research
institutes to request an increased micro-purchase threshold.
Procurement by micro-purchases was included in the final guidance
published on December 26, 2013 (78 FR 78589) in response to comments
provided to the proposed guidance published on February 1, 2013
(available at www.regulations.gov under docket number OMB-2013-0001).
The intent of the procurement by micro-purchase guidance was to
alleviate burden associated with the Uniform Guidance procurement
standards, allowing for recipients to make purchases below the micro-
purchase threshold without soliciting price or rate quotations, if the
non-Federal entity considers the price to be reasonable. Following the
publication of the final guidance, OMB received feedback from the
recipient community requesting additional time to comply with the
Uniform Guidance procurement standards at 2 CFR 200.317 through
200.326. In response, OMB allowed recipients a one-year grace period
provided the non-Federal entity appropriately documented delayed
implementation in their policies and procedures and they continued to
comply with previous OMB guidance. Towards the end of this initial
grace period, OMB received requests to delay implementation of the
procurement standards further, specifically citing the challenges
associated with implementing procurement by micro-purchase. In
response, OMB allowed for an additional grace period. Following the
allowance of the additional grace period, new cost-burden data was
provided by the recipient community regarding the implementation of
procurement by micro-purchase. This data reflected that many non-
Federal entities have existing micro-purchase thresholds that are
substantially higher than the micro-purchase threshold at that time of
$3,500. Recipients report that to make purchases above the micro-
purchase threshold, they rely on individuals with specialized skills
for their procurement offices and the final guidance would require non-
Federal entities to hire additional staff at a substantial cost to non-
Federal entities. Further, since finalization of 2 CFR 200, several
statutes have been enacted that impact the procurement thresholds in
the current guidance as summarized below.
The NDAA for Fiscal Year (FY) 2017 (NDAA 2017) increased the micro-
purchase threshold from $3,500 to $10,000 for institutions of higher
education, or related or affiliated nonprofit entities, nonprofit
research organizations or independent research institutes (41 U.S.C.
1908). The NDAA 2017 also establishes an interim uniform process by
which these recipients can request, and Federal awarding agencies can
approve requests to apply, a higher micro-purchase threshold.
Specifically, the NDAA 2017 allows a threshold above $10,000, if
approved by the head of the relevant executive agency and consistent
with clean audit findings under chapter 75 of title 31, internal
institutional risk assessment, or State law. The NDAA 2018 increases
the micro-purchase threshold to $10,000 for all recipients and also
increases the simplified acquisition threshold from $100,000 to
$250,000 for all recipients. A proposal to increase the micro-purchase
and simplified acquisition thresholds in the Federal Acquisition
Regulation (FAR) was published in the Federal Register on October 2,
2019 (84 FR 52420), FAR Case 2018-004. In addition, the American
Innovation and Competitiveness Act of 2017 (AICA), section 207(b)
requires that 2 CFR 200 be revised to conform with the requirements
concerning the micro-purchase threshold.
In response to these statutory changes, OMB issued OMB Memorandum
M-18-18, Implementing Statutory Changes to the Micro-Purchase and the
Simplified Acquisition Thresholds for Financial Assistance (June 20,
2018). Consistent with the requirements of NDAA 2017, this memo
outlined the process for institutions of higher education, related or
affiliated nonprofit entities, nonprofit research organizations, and
independent research institutes to request a higher micro-purchase
threshold from their cognizant Federal awarding agency for indirect
cost rates. The proposed changes to 2 CFR 200.319 and 200.320
incorporates the guidance available in M-18-18 and proposes to extend
the flexibility to request a higher micro-purchase threshold to all
non-Federal entities. Proposed changes also reflect the higher micro-
purchase threshold set forth in the 2017 and the American Innovation
and Competitiveness Act of 2017. The micro-purchase threshold
identified in the aforementioned legislation is $10,000.
B. Strengthening Merit Review and Notices of Funding Opportunities
OMB proposes revisions to 2 CFR 200.204 Federal awarding agency
review of merit proposals and 2 CFR 200.203 Notices of funding
opportunities to strengthen merit review and the notices of funding
opportunities. These proposed revisions require agencies to extend
their merit review process for all grants and cooperative agreements to
all awards in which the Federal awarding agency has the discretion to
choose the recipient. Proposed changes to 2 CFR 200.204 Federal
awarding agency review of merit proposals also clarify the objective of
the merit review process--to select recipients most likely to be
successful in delivering results based on the program objectives
outlined in section 2 CFR 200.202 Program planning and design--and thus
the merit review process should be designed accordingly.
Further, Federal awarding agencies are required to systematically
review Federal award selection criteria for effectiveness. These
proposed changes support the Administration's priority to ensure a fair
and transparent process for the selection of award recipients and
supports efforts under the PMA to ensure that grants and cooperative
agreements are designed to achieve program goals and objectives. OMB
seeks comments on the impacts this revision will have on the financial
assistance community.
C. Support for Domestic Preferences for Procurement
As expressed in Executive Order 13788 of April 18, 2017 (Buy
American and Hire American) and Executive Order 13858 of January 21,
2019 (Executive Order on Strengthening Buy-American Preferences for
Infrastructure Projects), it is the policy of this Administration to
maximize, consistent with law, the use of goods, products, and
materials produced in the United States, in Federal procurements and
through the terms and conditions of Federal financial assistance
awards. In support of this policy, OMB proposes to add 2 CFR 200.321
(Domestic preferences for procurement), encouraging Federal award
recipients, to the extent permitted by law, to maximize use of goods,
products, and materials produced in the United States when procuring
goods and services under Federal awards. This Part will apply to
procurements under a grant or cooperative agreement.
[[Page 3768]]
D. Promoting Free Speech
Revisions are proposed to 2 CFR 200.300 Statutory and national
policy requirements, to align with Executive Orders (E.O.) 13798
``Promoting Free Speech and Religious Liberty'' and E.O. 13864
``Improving Free Inquiry, Transparency, and Accountability at Colleges
and Universities.'' These Executive Orders advise agencies on the
requirements of religious liberty laws, including those laws that apply
to grants and provided a policy for free inquiry at institutions
receiving Federal grants. The revision to 2 CFR underscores the
importance of compliance with the First Amendment.
E. Standardization of Terminology and Implementation of Standard Data
Elements
OMB proposes to standardize terms across 2 CFR part 200 to support
efforts under the Grants CAP Goal to standardize the grants management
business process and data.
Some examples of proposed revisions include terms associated with
time periods (period of performance, budget period and renewal),
financial obligation, and assistance listing. The current terms used to
describe time periods are inconsistently used by Federal awarding
agencies. OMB proposes revisions to the definition of ``period of
performance'' in 2 CFR part 200 to reflect that the term is the
anticipated time interval between the start and end date of an initial
Federal award or subsequent renewal. The intent is to clarify that the
recipient may not incur obligations during the entire period of
performance in instances where a Federal awarding agency incrementally
funds the Federal award and funding has not been received for a
subsequent budget period within the period of performance. For example,
a recipient may receive a Federal award that reflects a five-year
period of performance, but only received one year worth of funding as
reflected in the first year budget period. The recipient may only incur
costs during the first year budget period until subsequent budget
periods are funded based on the availability of appropriations,
satisfactory performance, and compliance with the terms and conditions
of the award. The proposed change also ensures consistent use of the
term for purposes of transparency reporting as required by FFATA.
Further, OMB is proposing definitions for budget period and renewal to
further clarify the use of time period terms throughout 2 CFR.
In addition, OMB proposes to replace the term ``obligation'' to
either ``financial obligation'' or ``responsibility'' within the
guidance as appropriate, to ensure alignment with DATA Act definitions.
OMB requests comments on the anticipated impact of replacing the term
``obligation'' from 2 CFR part 200 to ``financial obligation'';
specifically, OMB asks if replacing ``obligation'' will help to align
requirements set out in 2 CFR 200 and the DATA Act.
OMB also proposes changes across 2 CFR to ensure consistent use of
terms across parts 25, 170, 180 and 200 where possible, relying on 2
CFR part 200 as the primary source. As reflected in the proposed
changes, there are instances where the terms within 2 CFR cannot be
made consistent. For example, the term ``non-Federal entity'' cannot be
consistently defined across 2 CFR: parts 25 and 170 apply to Federal
awards to foreign organizations, foreign public entities, and for-
profit organizations, while part 200 only applies to these type of non-
Federal entities when a Federal awarding agency elects for part 200 to
apply. For definitions that are consistent across 2 CFR parts 25, 170
and 200, revisions have been made to parts 25 and 170 to refer
definitions to part 200 as the authoritative source.
The definitions ``Catalog for Federal Domestic Assistance (CFDA)
number'' and ``CFDA program title'' have been replaced with the terms
``Assistance listing number'' and ``Assistance listing program title''
to reflect the change in terminology.
OMB proposes a number of additional revisions to definitions for
clarity. For example, the term management decision is revised to
emphasize that it is a written determination provided by a Federal
awarding agency or pass-through entity.
To promote uniform application of standard data elements in future
information collection requests, OMB is also proposing revisions to 2
CFR 200.206 and 200.328 to reflect that information collection requests
must adhere to the standards available from the OMB-designated
standards lead. This proposed change further supports OMB Memorandum M-
19-16 Centralized Mission Support Capabilities for the Federal
Government, which requires that future shared service solutions must
adhere to the Federal Integrated Business Framework standards
(available at: https://ussm.gsa.gov/fibf/).
Further, OMB proposes updates throughout 2 CFR part 200 to replace
the term ``standard form'' with ``common form.'' A common form is an
information collection that can be used by two or more agencies, or
governmentwide, for the same purpose. A standard form is a type of
common form; however, standard forms must be used by all Federal
awarding agencies, which may not be appropriate for Federal financial
assistance given the variety of programs. The purpose of clarifying the
term ``common form'' within 2 CFR is to help encourage agencies to seek
common data solutions, increase efficiency, and better account for the
burden imposed on the public by Federal agencies. More information
regarding common forms and flexibility under the Paperwork Reduction
Act is available at: https://www.whitehouse.gov/omb/information-regulatory-affairs/federal-collection-information/.
Finally, OMB proposes to reformat the definitions section of 2 CFR
part 200, subpart A--Acronyms and Definitions by removing the section
numbers to facilitate future additions to this section.
F. Improving the Governmentwide Approach to Performance and Risk
The President's Management Agenda, Results-Oriented Accountability
for Grants CAP goal is working toward shifting the balance between
compliance and performance while reducing burden. Agencies are
encouraged to promote promising performance practices that support the
achievement of program goals and objectives. Many Federal agencies are
working together to innovate and develop a risk-based approach that
incorporates performance to achieve results-oriented grants (where
applicable). By shifting the focus to the balance between performance
and compliance, agencies may have the opportunity to streamline
burdensome compliance requirements for programs that demonstrate
results. To support this goal, OMB proposes changes to emphasize the
importance of focusing on performance to achieve program results
throughout the Federal award lifecycle, starting with a proposed new
section 2 CFR 200.202 Program planning and design. This new section
formally requires practices that are already expected of Federal
awarding agencies to develop a strong program design by establishing
program goals, objectives, and indicators, to the extent permitted by
law, before the applications are solicited. Proposed changes to 2 CFR
200.207 Specific conditions allow Federal awarding agencies to apply
less restrictive conditions based on risk and require Federal awarding
agencies to ensure that specific Federal award conditions
[[Page 3769]]
are consistent with the program design and include clear performance
expectations of recipients. Consistent changes are proposed in 2 CFR
200.210 Information contained in a Federal award and 2 CFR 200.310
Performance measurement requiring Federal awarding agencies to provide
recipients with clear performance goals, indicators, and milestones.
Further, OMB proposes changes to 200.102 Exceptions section to
emphasize that Federal awarding agencies are encouraged to request
exceptions to certain provisions of 2 CFR 200 in support of innovative
program designs that apply a risk-based, data-driven framework to
alleviate select compliance requirements and hold recipients
accountable for good performance. OMB recognizes that Federal financial
assistance program goals and their intended results will differ by type
of Federal program. For example, criminal justice grant programs may
focus on specific goals such as reducing crime, basic scientific
research grant programs may focus on expanding knowledge, and
infrastructure projects may fund building or infrastructure projects.
OMB is interested in receiving public comments on existing promising
performance practices that Federal awarding agencies may be able to
leverage within existing and proposed flexibilities or future
exceptions, and in general on how grant makers can better hold
recipients accountable for results. This is of particular interest as
Federal agencies implement and carry out the requirements of the
Foundations of Evidence-Based Policymaking Act of 2018, which
emphasizes collaboration and coordination to advance data and evidence-
building functions in the Federal government.
Related to the above proposals to strengthen program planning and
Federal award terms and conditions, OMB proposes changes to 200.210
Information contained in a Federal award and 200.339 Termination to
strengthen the ability of the Federal awarding agency to terminate
Federal awards, to the greatest extent authorized by law, when the
Federal award no longer effectuates the program goals or Federal
awarding agency priorities. Federal awarding agencies must clearly
articulate the conditions under which a Federal award may be terminated
in their applicable regulations and in the terms and conditions of
Federal awards. The intent of this proposal is to ensure that Federal
awarding agencies prioritize ongoing support to Federal awards that
meet program goals. For instance, following the issuance of a Federal
award, if additional evidence reveals that a specific award objective
is ineffective at achieving program goals, it may be in the
government's interest to terminate the Federal award. Further,
additional evidence may cause the Federal awarding agency to
significantly question the feasibility of the intended objective of the
award, such that it may be in the interest of the government to
terminate the Federal award. OMB also proposes the elimination of the
termination for cause provision because this term is not substantially
different than the provision allowing Federal awarding agencies to
terminate Federal awards when the recipient fails to comply with the
terms and conditions. OMB seeks feedback on the impact of these
proposed changes and whether the language meets the intended outcome of
these provisions.
In addition, OMB proposes changes to the definition of fixed amount
awards in 200.1 to allow Federal awarding agencies to apply the
provision to both grant agreements and cooperative agreements.
The revisions in 2 CFR 200.301 emphasize that agencies are
encouraged to measure recipient performance to improve program goals
and objectives, share lessons learned, and spread the adoption of
promising practices. While understanding that grant program goals and
their intended results will differ by type of program, the Grants CAP
Goal is working to shift the culture of Federal grant making from a
heavy focus on compliance to a balanced approach that includes a focus
on the degree to which grant programs achieve their goals and intended
results.
To provide clarity and consistency among Federal awarding agencies,
a revision to include program evaluation costs as an example of a
direct cost under a Federal award has been included in 2 CFR 200.413
Direct costs. Please refer to OMB Circular A-11 200.22 for a definition
on program evaluation. Evaluation costs are allowed as a direct cost in
existing guidance. This language is intended to strengthen this intent
and ensure that agencies are applying this consistently. Agencies are
reminded that evaluation costs are allowable costs (either as direct or
indirect), unless prohibited by statute or regulation. The work under
the Grants CAP goal performance work group emphasizes evaluation as an
important practice to understand the results achieved with Federal
funding. OMB seeks comments on the impact of this revision within the
guidance.
G. Eliminate References to Non-Authoritative Guidance
To support implementation of Executive Order 13892 of October 9,
2019 (Promoting the Rule of Law Through Transparency and Fairness in
Civil Administrative Enforcement and Adjudication) and to prohibit
Federal awarding agencies from including references to non-
authoritative guidance in the terms and conditions of Federal awards,
OMB proposes changes to 200.210 Information contained in Federal
awards. These proposed changes are intended reduce recipient burden and
prevent Federal awarding agencies from imposing non-binding guidance on
recipients that has not gone through appropriate public notice and
comment.
H. Emphasis on Machine-Readable Information Format
OMB proposes clarifying the methods for collection, transmission,
and storage of data in 2 CFR 200.335 to further explain and promote the
collection of data in machine-readable formats. A Machine-readable
format is a format that can be easily processed by a computer without
human intervention while ensuring no semantic meaning is lost (44
U.S.C. 3502(18)). The proposal reinforces the machine-readable
requirements in the Foundations of Evidence-Based Policymaking Act of
2018 (Pub. L. 115-435) and accompanying OMB guidance, and reflects the
need to continually evaluate which formats (and structures) maximize
accessibility and usability for all stakeholders. Machine-readable
formats will also help support the Leveraging Data as a Strategic Asset
Cross-Agency Priority Goal (CAP Goal #2) and efforts under the Grants
CAP Goal to Build Shared IT Infrastructure.
I. Changes to Closeout Provisions To Reduce Recipient Burden and
Support GONE Act Implementation
Based on lessons learned from the implementation of 2 CFR part 200
and the Grants Oversight and New Efficiency Act (GONE Act), OMB
proposes several changes to Sec. 200.343 (Closeout) to support timely
closeout, improve the accuracy of final closeout reports, and reduce
burden.
OMB proposes to increase the number of days for recipients to
submit closeout reports and liquidate all financial obligations from 90
days to 120 days. This proposal takes into consideration that it is
challenging for pass-through entities with a large number of subawards
to reconcile subawards and submit final reports to Federal awarding
[[Page 3770]]
agencies within 90 days. Recognizing the need for pass-through entities
to receive timely reports from subrecipients to report back to Federal
awarding agencies, OMB proposes to continue to require subrecipients to
submit their reports to the pass-through entity within 90 days. The
intent of this proposed change is to support financial reconciliation,
help ease the burden associated with submitting reports for closeout,
and promote improved accuracy. However, OMB recognizes that providing
additional time may increase the likelihood that non-Federal entities
will not submit their final closeout reports. To mitigate this risk,
OMB is also proposing for Federal awarding agencies to report when a
non-Federal entity does not submit final closeout reports as a failure
to comply with the terms and conditions of the award to the OMB-
designated integrity and performance system. Finally, OMB proposes the
requirement of Federal awarding agencies to make every effort to close
out Federal awards within one year after the end of the period of
performance unless otherwise directed by authorizing statute. The
proposed language is intended to promote timely closeout of awards,
assist with reconciling closeout activities, and hold recipients
accountable for submitting required closeout reports.
OMB seeks comments on the advantages and disadvantages of changes
to 2 CFR 200.343 (Closeout), including feedback on the amount of burden
this may reduce as well as the potential risk to Federal awarding
agencies.
J. Changes to Performing the Governmentwide Audit Quality Project
Proposed revisions to 2 CFR 200.513 include a change in the date
for the requirement for a governmentwide audit data quality project
that must be performed once every 6 years beginning with audits
submitted in 2018. This date has been changed to 2021, given the
significant changes to the 2019 Compliance Supplement in support of the
Grants CAP Goal.
K. Expanded Use of the De Minimus Rate
The first proposed revision to 2 CFR 200.414(f) allows the use of
the de minimus rate of 10% of modified total direct costs (MTDC) to all
non-Federal entities (except for those described in Appendix VII to
Part 200--State and Local Government and Indian Tribe Indirect Cost
Proposals, paragraph D.1.b). Currently, the de minimus rate can only be
used for non-Federal entities that have never received a negotiated
indirect cost rate. The use of the de minimus rate has reduced burden
for both the non-Federal entities and the Federal agencies for
preparing, reviewing and negotiating indirect cost rates. Since the
publication of the final rule in 2013, both Federal agencies and non-
Federal entities have advocated to expand the use of the de minimus
rate for non-Federal entities that have negotiated an indirect cost
rate previously, but for some circumstances, the negotiated rates have
expired. The expiration may be due to breaks in Federal relationships
and grant funding, or lack of resources for preparing an indirect cost
proposal. This proposed change will further reduce the administrative
burden for non-federal entities and Federal agencies and shift more
resources toward accomplishing the program mission.
Another proposed revision adds language to 2 CFR 200.414(f) to
clarify that when a non-Federal entity is using the de minimus rate for
its federal grants, it is not required to provide proof of costs that
are covered under that rate. The 10% de minimus rate was designed to
reduce burden for small non-federal entities and the requirement to
document the actual indirect costs would eliminate the benefits of
using the de minimus rate. Lastly, for transparency purposes, a
proposed revision adds a new subsection to 200.414(h) to require that
all grantees' negotiated agreements for indirect cost rates are
collected and displayed on public website. The agency responsible for
this task and the public website will be designated by OMB.
II. Meeting Statutory Requirements and Aligning 2 CFR With Other
Authoritative Source Requirements
A. Prohibition on Certain Telecommunication and Video Surveillance
Services or Equipment
OMB proposes revisions to 2 CFR to align with section 889 of the
NDAA 2019. The NDAA 2019 prohibits the head of an executive agency from
obligating or expending loan or grant funds to procure or obtain,
extend or renew a contract to procure or obtain, or enter into a
contract (or extend or renew a contract) to procure or obtain the
equipment, services, or systems prohibited systems as identified in
NDAA 2019. To implement this requirement, OMB proposes 2 CFR 200.216
Prohibition on certain telecommunication and video surveillance
services or equipment, which prohibit Federal award recipients from
using government funds to enter into contracts (or extend or renew
contracts) with entities that use covered telecommunications equipment
or services. This prohibition applies even if the contract is not
intended to procure or obtain, any equipment, system, or service that
uses covered telecommunications equipment or services. As described in
section 889 of the NDAA of 2019, covered telecommunications equipment
or services includes:
[ssquf] Telecommunications equipment produced by Huawei
Technologies Company or ZTE Corporation (or any subsidiary or affiliate
of such entities).
[ssquf] For the purpose of public safety, security of government
facilities, physical security surveillance of critical infrastructure,
and other national security purposes, video surveillance and
telecommunications equipment produced by Hytera Communications
Corporation, Hangzhou Hikvision Digital Technology Company, or Dahua
Technology Company (or any subsidiary or affiliate of such entities).
[ssquf] Telecommunications or video surveillance services provided
by such entities or using such equipment.
[ssquf] Telecommunications or video surveillance equipment or
services produced or provided by an entity that the Secretary of
Defense, in consultation with the Director of the National Intelligence
or the Director of the Federal Bureau of Investigation, reasonably
believes to be an entity owned or controlled by, or otherwise connected
to, the government of a covered foreign country.
OMB has limited data on the impact of this prohibition on Federal
award recipients and contractors who use covered technology and seeks
feedback on the feasibility, burden, programmatic impact, and cost
associated with implementing this requirement. Commenters are
encouraged to provide relevant data on the impacts of this proposed
change and suggestions on how to support implementation of this
prohibition.
B. Never Contract With the Enemy
To meet statutory requirements, OMB proposes adding Part 183 to 2
CFR to implement Never Contract with the Enemy, consistent with the
fact that the law applies to only a small number of grants and
cooperative agreements. Never Contract with the Enemy applies only to
grants and cooperative agreements that exceed $50,000, are performed
outside the United States, including U.S. territories, to a person or
entity that is actively opposing United States or coalition forces
involved in a contingency operation in which
[[Page 3771]]
members of the Armed Forces are actively engaged in hostilities.
To implement Never Contract with the Enemy and to reflect current
practice, OMB proposes requiring Federal awarding agencies to utilize
the System for Award Management (SAM) Exclusions and Federal Awardee
Performance and Integrity Information System (FAPIIS) to ensure
compliance before awarding a grant or cooperative agreement. Federal
awarding agencies are prohibited from making any awards to persons or
entities listed in SAM Exclusions pursuant to Never Contract with the
Enemy and are required to list in FAPIIS any grant or cooperative
agreement terminated due to Never Contract with the Enemy as a
Termination for Material Failure to Comply. The proposed revisions also
require agencies to insert terms and conditions in grants and
cooperative agreements regarding non-Federal entities' responsibilities
to ensure no Federal award funds are provided directly or indirectly to
the enemy, to terminate subawards in violation of Never Contract with
the Enemy, and to allow the Federal Government access to records to
ensure that no Federal award funds are provided to the enemy.
The law allows Federal awarding agencies to terminate, in whole or
in part any grant, cooperative agreement, or contract that provides
funds to the enemy, as defined in the NDAA for FY 2015. This statute
applies to procurement as well as to grants and cooperative agreements
and OMB will coordinate with the procurement community as appropriate
before issuing final guidance, including the roles and responsibilities
of the covered combatant command and Federal awarding agencies. With
the exception of access to records, the Never Contract with Enemy
provision will sunset in December 2019; however, there is a current
proposal to extend these requirements. OMB anticipates that these
statutory requirements may be extended, and therefore seeks comments at
this time on these proposed revisions.
C. Requirement for the Federal Awardee Performance and Integrity
Information System (FAPIIS) To Include Information on a Non-Federal
Entity's Parent, Subsidiary, or Successor Entities
To meet statutory requirements, OMB proposes revisions to 2 CFR
parts 25 and 200 to implement Sec. 852 of the NDAA 2013, which requires
that the Federal Awardee Performance and Integrity Information System
(FAPIIS) include information on a non-Federal entity's parent,
subsidiary, or successor entities. OMB proposes to require financial
assistance applicants to provide information in SAM on their immediate
owner and highest-level owner and subsidiaries, as well as on all
predecessors that have been awarded a Federal contract, grant, or
cooperative agreement within the last three years. In addition, OMB
proposes to require that prior to making a grant or cooperative
agreement, agencies must consider all of the information in FAPIIS with
regard to an applicant's immediate owner or highest-level owner and
predecessor, or subsidiary, if applicable. These revisions are
consistent with the Federal Acquisition Regulation (FAR) final rule
regarding this law published at 81 FR 11988 on March 7, 2016. OMB seeks
comments and data on the following: The burden on recipients regarding
the implementation of the statute, the applicability of this
requirement to different types of entities (i.e., states, local
governments, and tribes), the alignment of these revisions with the
FAR, and any deviations from the FAR change that OMB should consider.
D. Increase Transparency Through FFATA, as Amended by the DATA Act
OMB proposes several revisions to increase transparency regarding
Federal spending as required by FFATA, as amended by the DATA Act,
which mandates Federal agencies to report Federal appropriations
received or expended by Federal agencies and non-Federal entities. OMB
also proposes revisions to the reporting thresholds to further align
financial assistance requirements with those of the Federal acquisition
community.
To increase transparency, OMB proposes to expand the applicability
of Federal financial assistance in 2 CFR part 25 and 2 CFR part 170
beyond grants and cooperative agreements so that it includes other
types of financial assistance that Federal agencies receive or
administer such as loans, insurance, contributions, and direct
appropriations.
OMB also proposes to make changes throughout 2 CFR to make it clear
that Federal agencies may receive Federal financial assistance awards.
This will increase transparency for Federal awards received by Federal
agencies.
To further align implementation of FFATA, as amended by DATA Act,
between the Federal financial assistance and acquisition communities,
OMB proposes revisions to Federal awarding agency and pass-through
entity reporting thresholds. For Federal awarding agencies, OMB
proposes revisions to 2 CFR part 170 to require agencies to report
Federal awards that equal or exceed the micro-purchase threshold as set
by the FAR at 48 CFR subpart 2.1. Consistent with the FAR threshold for
subcontract reporting, OMB is proposing to raise the reporting
threshold for subawards that equal or exceed $30,000. OMB seeks
comments that includes an analysis on the advantages and disadvantages
of raising this threshold.
OMB also proposes revisions to 2 CFR part 25 to allow agencies the
flexibility to exempt a foreign entity applying for or receiving an
award or subaward for a project or program performed outside the United
States valued at less than $100,000. Currently, Federal awarding
agencies have the flexibility to exempt this requirement for awards
valued at less than $25,000. Federal awarding agencies may exempt the
registration requirement up to $100,000 in cases where the agency has
conducted a risk-based analysis and deems it impractical for the entity
to comply with the requirements(s). OMB proposes this revision after
receiving feedback from the international community that requiring
certain foreign entities to register in SAM introduces substantial
burden with no significant value for the Federal awarding agency.
Federal awarding agencies will remain responsible for reporting these
awards for transparency purposes. Recognizing the benefits of SAM
registration, OMB is interested in feedback in support or against the
proposal to raise the threshold.
Finally, OMB proposes requiring Federal awarding agencies to
associate Financial Assistance Listings with the authorizing statute to
make listings more consistent. This supports implementation of the DATA
Act which requires agencies to report award level Financial Assistance
Listings information for display on www.usaspending.gov.
OMB seeks comments on whether the proposed revisions increase
transparency regarding Federal spending and support implementation of
the DATA Act.
E. Aligning 2 CFR With Authoritative Sources
OMB proposes a revision to 2 CFR 200.431 Compensation--fringe
benefits to allow states to conform with Generally Accepted Accounting
Principles (GAAP), specifically Governmental Accounting Standards Board
(GASB) Statement 68, and to continue to claim pension costs that are
both actual and funded. OMB proposes this revision because GASB issued
Statement 68, Accounting and Financial Reporting for Pensions which
amends GASB Statement 27 and allows non-
[[Page 3772]]
Federal entities (NFE) to claim only estimated pension costs in their
financial statements. OMB's revision will allow non-Federal entities to
continue to claim pension costs that are both actual and funded.
OMB also proposes a revision to the definitions of 2 CFR 200.12
Capital assets, 2 CFR 200.59 Intangible property, 2 CFR 200.449.
The definition for ``Improper Payment'' has been revised to refer
to the authoritative source for clarity, OMB Circular A-123--
Management's Responsibility for Internal Control in Federal Agencies,
Appendix C--Requirements for Payment Integrity Improvement. In
addition, both the ``Improper Payment'' and ``Questioned Cost''
definitions have been revised to clarify that questioned costs are not
an improper payment until reviewed and confirmed to be improper as
defined in OMB Circular A-123, Appendix C.
III. Clarifying Requirements Regarding Areas of Misinterpretation
Following the publication of the Uniform Guidance, OMB received a
substantial amount of questions from stakeholders requesting
clarifications about key aspects of the guidance. In other instances,
it has come to OMB's attention that the interpretation of certain
provisions was not consistent with the intent of the Uniform Guidance.
In response, OMB proposes a number of clarifications that are aimed at
reducing recipient administration burden and ensuring consistent
interpretation of guidance.
A. Responsibilities of the Pass-Through Entity To Address Only a
Subrecipient's Audit Findings Related to Their Subaward
To clarify requirements regarding responsibility for audit
findings, OMB proposes a revision to 2 CFR 200.331 Requirements for
pass-through entities to clarify that pass-through entities (PTE) are
responsible for addressing only a subrecipient's audit findings that
are specifically related to their subaward. For example, a PTE is not
required to address all of the subrecipient's audit findings. In
addition, the PTE may rely on the subrecipient's auditors and cognizant
agency's oversight for routine audit follow-up and management
decisions. These changes reduce the burden for PTEs by allowing a PTE
to rely on the cognizant agency to address a subrecipient's entity-wide
issues.
B. Reducing Burden on Universities by Clarifying Timing of the
Disclosure Statement
OMB also proposes to clarify the timing of submission of the
disclosure statement (DS-2), which is only required for universities
that meet certain thresholds as defined in 48 CFR 9903.202-1(f). This
revision reduces burden for universities while maintaining the
requirement for universities to implement policies in compliance with 2
CFR. OMB seeks comments on whether the proposed revisions clarify 2 CFR
requirements and reduce burden for PTEs and universities.
C. Response to Frequently Asked Questions Related to the Prior Release
of 2 CFR
In July 2017, OMB developed and posted Frequently Asked Questions
(FAQs) on the Chief Financial Officers Council website in response to
stakeholder requests for clarification on the first publication of 2
CFR (https://cfo.gov//wp-content/uploads/2017/08/July2017-UniformGuidanceFrequentlyAskedQuestions.pdf). Due to the volume of
questions related to these topics, OMB proposes clarifying the
following: The meaning of the words ``must'' and ``may'' as they
pertain to requirements; the effective date of 2 CFR; applicability and
documentation requirements when a non-Federal entity elects to charge
the de minimus indirect cost rate of modified total direct costs
(MTDC); pass-through entity responsibilities related to indirect cost
rates and audits; and applicability of 2 CFR to FAR based contracts.
These proposed revisions are intended to improve clarity and reduce
recipient burden by providing guidance on implementing 2 CFR.
D. Applicability of Guidance to Federal Agencies
OMB proposes changes to 2 CFR 200.101 (Applicability) to clarify
that Federal awarding agencies may apply the requirements of 2 CFR 200
to other Federal agencies, to the extent permitted by law. This
proposed change recognizes that there are instances when Federal
awarding agencies or pass-through entities have the authority to issue
Federal awards to Federal agencies and in these instances, the
provisions of 2 CFR 200 may be applied, as appropriate. This proposed
change is consistent with how for-profit entities, foreign public
entities, or foreign organizations are treated in the Uniform Guidance.
Executive Orders 12866 and 13563
Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess
all costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). The
revision of 2 CFR is not a regulatory action and therefore it is not
subject to the 12866 review by OIRA.
Regulatory Flexibilities Act
The Regulatory Flexibility Act 5 U.S.C. 601, et seq., requires that
an agency provide a final regulatory flexibility analysis or to certify
that the rule will not have a significant economic impact on a
substantial number of small entities. OMB does not expect this guidance
to have a significant economic impact on a substantial number of small
entities within the meaning of the Regulatory Flexibility Act. There
are some proposed revisions that may impose burden, however, there are
more proposed revisions that reduce burden to small entities. When
reviewing all proposed revisions, the burden that will be reduced for
recipients is much greater than the burden imposed.
OMB's proposal to expand the applicability of Federal financial
assistance in 2 CFR part 25 beyond grants and cooperative agreements so
that it includes other types of financial assistance that Federal
agencies receive or administer such as loans and insurance will impact
small entities, but it will not have a significant impact on a
substantial number of small entities. Currently, 2 CFR part 25 requires
all non-Federal entities that apply for grants and cooperative
agreements to register in the System for Award Management (SAM). OMB
proposes to require all entities that apply for Federal financial
assistance such as loans and insurance to register in SAM, which
requires the establishment of a unique entity identifier. In practice,
some Federal awarding agencies already require SAM registration for all
types of Federal financial assistance and the proposed change would
make this practice consistent among agencies. As noted in the Paperwork
Reduction Act section, as of June 20, 2019, there were 159,477 unique
Federal financial assistance registrants in the System for Awards
Management (SAM). According to data accessed from www.usaspending.gov,
in FY 2018, approximately 2,952 small businesses who received awards
for other types of
[[Page 3773]]
financial assistance did not have a unique entity identifier. Assuming
that non-Federal entities with a unique entity identifier reported to
www.usaspending.gov are already registered in SAM, this change will
impact approximately 2,952 small entities annually. SAM registration is
estimated to take two and a half hours per response, which results in
7,380 burden hours annually. Individuals who receive Federal financial
assistance as a natural person remain exempt from this requirement.
This change is proposed to successfully implement FFATA, as amended by
the DATA Act. There is no exemption from the guidance for small
entities, because the law does not provide for any such exemption.
Recognizing that there are limitations to relying on
www.usaspending.gov data to estimate the impact of this change on small
entities, OMB requests comments on how burdensome this proposed
requirement may be for small entities.
The proposed guidance also clarifies requirements regarding pass-
through entities' responsibility for sub-award audit findings and
clarifies the timing of a disclosure statement which is only required
for universities that meet certain thresholds. These proposed changes
are intended to reduce burden and will not have a significant economic
impact on a substantial number of small entities because they clarify
existing requirements; they do not include any new requirements for
non-Federal entities.
OMB proposes to add a provision to 2 CFR part 200 Subpart D--Post
Federal Award Requirements, 2 CFR 200.321 (Domestic preferences for
procurement), encouraging Federal award recipients, to the extent
permitted by law, to maximize use of goods, products, and materials
produced in the United States when procuring goods and services under
Federal awards. This revision was added in response to Executive Order
13788 of April 18, 2017 (Buy American and Hire American) and Executive
Order 13858 of January 21, 2019 (Executive Order on Strengthening Buy-
American Preferences for Infrastructure Projects). This may impose
burden on small entities that primarily procure goods and services
produced outside the U.S.
The proposed guidance also provides consistency among definitions
and terms and proposes several provisions to increase transparency
regarding Federal spending. These proposed changes are intended to
reduce recipient burden and not have a significant economic impact on a
substantial number of small entities because they will affect Federal
awarding agencies; they do not include any new requirements for non-
Federal entities.
The proposed guidance introduces a new provision to align with
section 889 of the NDAA 2019, Prohibition on certain telecommunication
and video surveillance services or equipment. This statutory
requirement may introduce burden to small entities that are prohibited
from obligating or expending grant funds to procure or obtain, extend
or renew a contract to procure or obtain, or enter in a contract with,
as identified in the NDAA 2019.
This proposed guidance implements a new statute that requires
applicants of Federal assistance to provide information on their owner,
predecessor and subsidiary, including the Commercial and Government
Entity (CAGE) Code and name of all predecessors, if applicable. This
will not have a significant economic impact on a substantial number of
small entities because small entities typically do not have a complex
corporate structure requiring them to report information on their
owner, predecessor, and subsidiary. Further, the burden is minimal for
a non-Federal entity to provide the name of its immediate owner and
highest-level owner.
The proposed guidance also implements a statute, Never Contract
with the Enemy, which will not have a significant economic impact on a
substantial number of small entities because it will affect only a
small number of grants and cooperative agreements. Never Contract with
the Enemy applies only to grants and cooperative agreements that exceed
$50,000, are performed outside the United States, including U.S.
territories, to a person or entity that is actively opposing the United
States or coalition forces involved in a contingency operation in which
members of the Armed Forces are actively engaged in hostilities.
The NDAA for FY2018 increased the micro-purchase threshold from
$3,500 to $10,000 and increased the simplified acquisition threshold
from $100,000 to $250,000 for all recipients. OMB's proposed revisions
reduces burden and will not have a significant economic impact on a
substantial number of small entities because it is likely to reduce
burden for all non-Federal entities.
Paperwork Reduction Act
Consistent with the Regulatory Flexibility Act analysis discussion,
the Paperwork Reduction Act (44 U.S.C. chapter 35) applies. The
proposed guidance contains information collection requirements and will
impact the current Information Collection Requests approved under OMB
control number 3090-0290 managed by the General Services
Administration. Accordingly, the Regulatory Secretariat Division of GSA
will submit a request for approval to amend the existing Information
Collection Requests for System for Award Management (SAM) registration
requirements for prime Federal financial assistance recipients.
Annual Reporting Burden: The estimated annual reporting burden
includes all possible entities for Federal financial assistance that
may be required to register in SAM. The estimated annual reporting
burden also includes entities that receive Federal financial assistance
reported in USASpending.gov and either may or may not be required to
register in SAM.
The current guidance only requires that prime applicants and
recipients of Federal financial assistance in the form of grants
register in SAM. Pursuant to 2 CFR Subtitle A, Chapter I, and Part 25
(75 FR 5672), prime applicants and recipients are required to maintain
accurate SAM registration accounts with current information at all
times during which they have an active Federal award, an application,
or a plan under consideration by a Federal awarding agency.
The burden estimates are approximations based on the best available
data.
As of July 7, 2019, there were 159,477 unique Federal financial
assistance registrants in SAM. However, it is important to note that
not all registrants in SAM ultimately apply for, or receive, Federal
financial assistance. To develop a more accurate estimate for the total
number of Federal financial assistance recipients, including loans and
other types of Federal financial assistance, OMB used data from SAM
combined with data from USASpending.gov on non-grant recipients of
Federal financial assistance to determine the anticipated number of
registrants for Federal financial assistance in SAM.
The Federal Funding Accountability and Transparency Act of 2006
(Pub. L. 109-282, as amended by section 6202(a) of Pub. L. 110-252)
established the requirement to create USASpending.gov. USASpending.gov
is a single, searchable website, accessible by the public that hosts
financial data on both Federal financial assistance and contracts.
Recipients of all types of Federal financial assistance, including
loans, submit their financial data to their Federal awarding agency.
Federal awarding agencies are then responsible for accurately
submitting recipient financial data to USASpending.gov. OMB ran reports
in USASpending.gov
[[Page 3774]]
to identify the number of unique Federal financial assistance
recipients that receive Federal financial assistance other than grants
to isolate the total number of potential registrants that may be
expected to register in SAM as a result of the updates to the proposed
guidance.
To account for the number of loan and other types of Federal
financial assistance recipients that do not also receive grants, OMB
removed duplicate recipients based on recipient Data Universal
Numbering System Number (DUNS) numbers, from Dun & Bradstreet (D&B). At
this time all Federal financial assistance recipients are required to
register for DUNS numbers; however, DUNS numbers will be phased out as
the primary key to identify every entity record by 2020 in place of a
non-proprietary, SAM-generated, Unique Entity ID (UEI) number.
As of June 30, 2019 there were 41,795 grant, 122 loan, and 12,485
other Federal financial assistance recipients with unique DUNS numbers
reported in USASpending.gov. Therefore, based on the number of entities
with unique DUNS numbers that are registered in SAM (159,477), plus
entities that receive loans (122) or other Federal financial assistance
(12,485) reported in USASpending.gov that may not be reflected in SAM,
the total number of entities that may be impacted by the proposed
guidance associated Information Collection Requests under OMB control
number 3090-0290 could be 172,084 registrants.
Public reporting burden for Information Collection Requests under
OMB control number 3090-0290 is managed by the General Services
Administration and estimated to average 2.5 hours per response,
including the time for reviewing instructions, searching existing data
sources, gathering and maintaining the data needed, and completing and
reviewing the collection of information.
The annual reporting burden is estimated as follows:
Respondents: 172,084.
Responses per Respondent: 1.
Total Annual Responses: 172,084.
Hours per Response: 2.5.
Total Response Burden Hours: 430,210.
The proposed guidance also requires that registrants for Federal
financial assistance provide information on their owner, predecessor,
and subsidiary, including the Commercial and Government Entity (CAGE)
Code and name of all predecessors, if applicable. This information is
required to implement Sec. 852 of the NDAA of FY 2013, which requires
that the Federal Awardee Performance and Integrity Information System
(FAPIIS) include information on a non-Federal entity's parent,
subsidiary, or successor entities. Non-Federal entities are already
required to obtain a CAGE code for purposes of SAM registration. It is
anticipated that including this information as part of SAM registration
or for a renewal should not result in significant additional time.
Public reporting burden for this collection of information is estimated
to average .1 hours per response, including the time for reviewing
instructions, searching existing data sources, gathering and
maintaining the data needed, and completing and reviewing the
collection of information. Based on the burden estimates for the total
number of SAM registrants indicated in the previous section, the annual
reporting burden for this proposal is estimated as follows:
Respondents: 172,084.
Responses per respondent: 1.
Total annual responses: 172,084.
Preparation hours per response: .1.
Total response burden hours: 17,208.
The number of respondents estimated in this section is based on the
best available data from SAM and USASpending.gov. It is important to
note that not all registrants in SAM complete applications for Federal
financial assistance. Based on the financial data from USASpending.gov,
less than one third of registrants in SAM receive Federal financial
assistance. Therefore, the actual number of respondents and the
relative burden may be significantly lower than the estimated amounts.
Request for Comments Regarding Paperwork Burden
Submit comments, including suggestions for reducing this burden,
not later than March 23, 2020.
Submit comments identified by ``Information Collection 3090-0290,
System for Award Management Registration Requirements for Prime Grant
Recipients'' by any of the following methods:
Regulations.gov: http://www.regulations.gov. Submit
comments via the Federal eRulemaking portal by searching the OMB
control number 3090-0290 Docket No. 2019-0005. Select the link
``Comment Now'' that corresponds with ``Information Collection 3090-
0290, System for Award Management Registration Requirements for Prime
Grant Recipients''. Follow the instructions provided on the screen.
Please include your name, company name (if any), and ``Information
Collection 3090-0290, System for Award Management Registration
Requirements for Prime Grant Recipients'' on your attached document.
Mail: General Services Administration, Regulatory
Secretariat Division (MVCB), 1800 F Street NW, Washington, DC 20405.
ATTN: Ms. Flowers/IC 3090-0290.
Public comments are particularly invited on: Whether this
collection of information is necessary for the proper performance of
functions of the System for Award Management Registration Requirements
for Prime Financial Assistance Recipients, and will have practical
utility; whether our estimate of the public burden of this collection
of information is accurate, and based on valid assumptions and
methodology; ways to enhance the quality, utility, and clarity of the
information to be collected; and ways in which we can minimize the
burden of the collection of information on those who are to respond,
through the use of appropriate technological collection techniques or
other forms of information technology.
Requester may obtain a copy of the justification from the General
Services Administration, Regulatory Secretariat (MVCB), Washington, DC
20405, telephone (202) 501-4755. Please cite OMB Control Number 3090-
0290, System for Award Management Registration Requirements for Prime
Grant Recipients, in all correspondence.
List of Subjects
2 CFR Part 25
Administrative practice and procedure; Grant programs; Grants
administration; Loan programs.
2 CFR Part 170
Colleges and universities; Grant programs; Hospitals; International
organizations; Loan programs; Reporting and recordkeeping requirements.
2 CFR Part 183
Foreign aid; Grants administration; Grant programs; International
organizations; Reporting and recordkeeping requirements.
2 CFR Part 200
Accounting; Colleges and universities; Grants administration; Grant
programs; Hospitals; Indians; Nonprofit organizations; Reporting and
recordkeeping requirements; State and local governments.
Timothy F. Soltis,
Deputy Controller.
For the reasons stated in the preamble, the Office of Management
and Budget proposes to amend 2 CFR parts
[[Page 3775]]
25, 170, 200 and add part 183 as set forth below:
PART 25--UNIVERSAL IDENTIFIER AND SYSTEM FOR AWARD MANAGEMENT
0
1. The authority citation for part 25 continues to read as follows:
Authority: Pub. L. 109-282; 31 U.S.C. 6102.
0
2. Amend Sec. 25.100 by revising the introductory text to read as
follows:
Sec. 25.100 Purposes of this part.
This part provides guidance to recipients to establish:
* * * * *
0
3. Revise Sec. 25.105 to read as follows:
Sec. 25.105 Types of awards to which this part applies.
This part applies to a Federal awarding agency's grants,
cooperative agreements, loans, and other types of Federal financial
assistance as defined in Sec. 25.306.
0
4. Revise Sec. 25.110 to read as follows:
Sec. 25.110 Types of recipient and subrecipient entities to which
this part applies.
(a) General. Through a Federal awarding agency's implementation of
the guidance in this part, this part applies to all Federal agencies
and non-Federal entities, other than those exempted by statute or
exempted in paragraphs (b), and (c) of this section, that--
(1) Apply for or receive Federal awards; or
(2) Receive subawards directly from recipients of those Federal
awards.
(b) Exemptions for individuals. None of the requirements in this
part apply to an individual who applies for or receives Federal
financial assistance as a natural person (i.e., unrelated to any
business or non-profit organization he or she may own or operate in his
or her name).
(c) Other exemptions required by law (e.g. statutory). (1) Under a
condition identified in paragraph (c)(2) of this section, a Federal
awarding agency may exempt a non-Federal entity or Federal agency from
an applicable requirement to obtain a unique entity identifier,
register in the SAM, or both.
(i) In that case, the Federal awarding agency must use a generic
unique entity identifier in data it reports to USASpending.gov if
reporting for a prime award to the non-Federal entity or Federal agency
is required by the Federal Funding Accountability and Transparency Act
(Pub. L. 109-282, hereafter cited as ``Transparency Act'').
(ii) Federal awarding agency use of a generic unique entity
identifier should be used rarely for prime award reporting because it
prevents prime awardees from being able to fulfill the subaward or
executive compensation reporting required by the Transparency Act.
(2) The conditions under which a Federal awarding agency may exempt
a non-Federal entity are--
(i) For any non-Federal entity or Federal agency, if the Federal
awarding agency determines that it must protect information about the
entity from disclosure if it is in the national security or foreign
policy interests of the United States, or to avoid jeopardizing the
personal safety of the Federal agency or non-Federal entity's staff or
clients.
(ii) For a foreign organization or foreign public entity applying
for or receiving a Federal award or subaward for a project or program
performed outside the United States valued at less than $100,000, if
the Federal awarding agency deems it to be impractical for the entity
to comply with the requirement(s). This exemption must be determined by
the Federal awarding agency on a case-by-case basis while utilizing a
risk-based approach and does not apply if subawards are anticipated.
(3) Federal awarding agencies' use of generic unique entity
identifier, as described in paragraphs (c)(1) and (2) of this section,
should be rare. Having a generic unique entity identifier limits a
recipient's ability to use Governmentwide systems that are needed to
comply with some reporting requirements.
0
5. Revise Sec. 25.200 to read as follows:
Sec. 25.200 Requirements for notice of funding opportunities,
regulations, and application instructions.
(a) Each Federal awarding agency that awards the types of Federal
financial assistance defined in Sec. 25.306 must include the
requirements described in paragraph (b) of this section in each notice
of funding opportunity, regulation, or other issuance containing
instructions for applicants that is issued either on or after the
effective date of this part; or
(b) The notice of funding opportunity, regulation, or other
issuance must require each non-Federal entity and Federal agency that
applies and does not have an exemption under Sec. 25.110 to:
(1) Be registered in the SAM prior to submitting an application or
plan;
(2) Maintain an active SAM registration with current information,
including information on a recipient's immediate and highest level
owner and subsidiaries, as well as on all predecessors that have been
awarded a Federal contract or grant within the last three years, if
applicable, as defined in the FAR (52 part 204-20), at all times during
which it has an active Federal award or an application or plan under
consideration by a Federal awarding agency; and
(3) Provide its unique entity identifier in each application or
plan it submits to the Federal awarding agency.
(c) For purposes of this policy:
(1) The applicant is the non-Federal entity or Federal agency that
meets the Federal awarding agency's eligibility criteria and has the
legal authority to apply and to receive the Federal award. For example,
if a consortium applies for a Federal award to be made to the
consortium as the recipient, the consortium must have a unique entity
identifier. If a consortium is eligible to receive funding under a
Federal awarding agency program but the Federal awarding agency's
policy is to make the Federal award to a lead entity for the
consortium, the unique entity identifier of the lead non-Federal entity
will be used.
(2) A ``notice of funding opportunity'' is any paper or electronic
issuance that an agency uses to announce a funding opportunity, whether
it is called a ``program announcement,'' ``notice of funding
availability,'' ``broad agency announcement,'' ``research
announcement,'' ``solicitation,'' or some other term.
(3) To remain registered in the SAM database after the initial
registration, the applicant is required to review and update on an
annual basis from the date of initial registration or subsequent
updates its information in the SAM database to ensure it is current,
accurate and complete.
0
6. Revise Sec. 25.205 to read as follows:
Sec. 25.205 Effect of noncompliance with a requirement to obtain a
unique entity identifier or register in the SAM.
(a) A Federal awarding agency may not make a Federal award or
financial modification to an existing Federal award to a non-Federal
entity or Federal agency until the non-Federal entity or Federal agency
has complied with the requirements described in Sec. 25.200 to provide
a valid unique entity identifier and maintain an active SAM
registration with current information (other than any requirement that
is not applicable because the entity is exempted under Sec. 25.110).
(b) At the time a Federal awarding agency is ready to make a
Federal award, if the intended recipient has not complied with an
applicable requirement to provide a unique entity
[[Page 3776]]
identifier or maintain an active SAM registration with current
information, the Federal awarding agency:
(1) May determine that the applicant is not qualified to receive a
Federal award; and
(2) May use that determination as a basis for making a Federal
award to another applicant.
0
7. Revise Sec. 25.210 to read as follows:
Sec. 25.210 Authority to modify agency application forms or formats.
To implement the policies in Sec. Sec. 25.200 and 25.205, a
Federal awarding agency may add a unique entity identifier field to
information collections previously approved by OMB, without having to
obtain further approval to add the field.
0
8. Revise Sec. 25.215 to read as follows:
Sec. 25.215 Requirements for agency information systems.
Each Federal awarding agency that awards Federal financial
assistance (as defined in Sec. 25.306) must ensure that systems
processing information related to the Federal awards, and other systems
as appropriate, are able to accept and use the unique entity identifier
as the universal identifier for financial assistance applicants and
recipients.
0
9. Revise Sec. 25.220 to read as follows:
Sec. 25.220 Use of award term.
(a) To accomplish the purposes described in Sec. 25.100, a Federal
agency must include in each Federal award (as defined in Sec. 25.305)
the award term in appendix A to this part.
(b) A Federal awarding agency may use different letters and numbers
than those in appendix A to this part to designate the paragraphs of
the Federal award term, if necessary, to conform the system of
paragraph designations with the one used in other terms and conditions
in the Federal awarding agency's Federal awards.
0
10. Revise Sec. 25.300 to read as follows:
Sec. 25.300 Federal awarding agency.
Federal awarding agency has the meaning given in 2 CFR 200.1.
0
11. Revise Sec. 25.305 to read as follows:
Sec. 25.305 Federal award.
Federal award, for the purposes of this part, means an award of
Federal financial assistance that a non-Federal entity or Federal
agency receives directly from a Federal awarding agency.
0
12. Add Sec. 25.306 to subpart C to read as follows:
Sec. 25.306 Federal financial assistance.
(a) Federal financial assistance has the meaning given in 2 CFR
200.1 and also includes assessed or voluntary contributions, for
purposes of this part.
(b) Federal financial assistance, for purposes of this part, does
not include:
(1) Technical assistance, which provides services in lieu of money;
and
(2) A transfer of title to the Federally-owned property provided in
lieu of money, even if the Federal award is called a grant.
0
13. Amend Sec. 25.310 by revising the section heading to read as
follows:
Sec. 25.310 System for Award Management.
Sec. 25.320 [Removed]
0
14. Remove Sec. 25.320.
0
15. Revise Sec. 25.330 to read as follows:
Sec. 25.330 Foreign organization.
Foreign organization has the meaning given in 2 CFR 200.1.
0
16. Add Sec. 25.331 to subpart C to read as follows:
Sec. 25.331 Foreign public entity.
Foreign public entity has the meaning given in 2 CFR 200.1.
0
17. Add Sec. 25.333 to subpart C to read as follows:
Sec. 25.333 Highest level owner.
Highest level owner has the meaning given in 2 CFR 200.1.
0
18. Revise Sec. 25.335 to read as follows:
Sec. 25.335 Indian Tribe (or ``Federally recognized Indian Tribe'').
Indian Tribe (or ``Federally recognized Indian Tribe'') has the
meaning given in 2 CFR 200.1.
0
19. Revise Sec. 25.340 to read as follows:
Sec. 25.340 Local government.
Local government has the meaning given in 2 CFR 200.1.
0
20. Add Sec. 25.343 to subpart C to read as follows:
Sec. 25.343 Non-Federal entity.
Non-Federal Entity, as it is used in this part, has the meaning
given in paragraph C.3 of the award term in Appendix A to this part.
0
21. Revise Sec. 25.345 to read as follows:
Sec. 25.345 Nonprofit organization.
Nonprofit organization has the meaning given in Sec. 200.1.
0
22. Add Sec. 25.347 to subpart C to read as follows:
Sec. 25.347 Predecessor.
Predecessor means a non-Federal entity that is replaced by a
successor.
0
23. Revise Sec. 25.350 to read as follows:
Sec. 25.350 State.
State has the meaning given in 2 CFR 200.1.
0
24. Revise Sec. 25.355 to read as follows:
Sec. 25.355 Subaward.
Subaward has the meaning given in 2 CFR 200.1.
0
25. Add Sec. 25.357 to subpart C to read as follows:
Sec. 25.357 Successor.
Successor means a non-Federal entity that has replaced a
predecessor by acquiring the assets and carrying out the affairs of the
predecessor under a new name (often through acquisition or merger). The
term ``successor'' does not include new offices or divisions of the
same company or a company that only changes its name.
0
26. Revise Sec. 25.360 to read as follows:
Sec. 25.360 Subrecipient.
Subrecipient has the meaning given in 2 CFR 200.1.
0
27. Add Sec. 25.362 to subpart C to read as follows:
Sec. 25.362 Subsidiary.
Subsidiary has the meaning given in 2 CFR 200.1.
0
28. Revise Appendix A to Part 25 to read as follows:
Appendix A to Part 25--Award Term
I. System for Award Management and Universal Identifier Requirements
A. Requirement for System for Award Management
Unless you are exempted from this requirement under 2 CFR
25.110, you as the recipient must maintain current information in
the SAM. This includes information on your immediate and highest
level owner and subsidiaries, as well as on all of your predecessors
that have been awarded a Federal contract or grant within the last
three years, if applicable as defined in the FAR (9 CFR part 104-6),
until you submit the final financial report required under this
Federal award or receive the final payment, whichever is later. This
requires that you review and update the information at least
annually after the initial registration, and more frequently if
required by changes in your information or another Federal award
term.
B. Requirement for Unique Entity Identifier
If you are authorized to make subawards under this Federal
award, you:
1. Must notify potential subrecipients that no non-Federal
entity (see definition in paragraph C of this award term) or Federal
agency may receive a subaward from you until the non-Federal entity
or Federal agency has provided its Unique Entity Identifier to you.
2. May not make a subaward to a non-Federal entity or Federal
agency until the non-Federal entity or Federal agency has provided
its Unique Entity Identifier to you.
C. Definitions
For purposes of this term:
1. System for Award Management (SAM) means the Federal
repository into which a
[[Page 3777]]
non-Federal entity or Federal agency must provide information
required for the conduct of business as a recipient. Additional
information about registration procedures may be found at the SAM
internet site (currently at https://www.sam.gov).
2. Unique Entity Identifier means the identifier required for
SAM registration to uniquely identify business entities.
3. Non-Federal entity has meaning given in 2 CFR 200.1 and also
includes all of the following, for purposes of this part:
a. A foreign organization;
b. A foreign public entity; and
c. A domestic for-profit organization.
4. Subaward has the meaning given in 2 CFR 200.1.
5. Subrecipient has the meaning given in 2 CFR 200.1.
PART 170--REPORTING SUBAWARD AND EXECUTIVE COMPENSATION INFORMATION
0
29. The authority citation for part 170 continues to read as follows:
Authority: Pub. L. 109-282; 31 U.S.C. 6102.
0
30. Revise Sec. 170.100 to read as follows:
Sec. 170.100 Purposes of this part.
This part provides guidance to Federal awarding agencies on
reporting Federal awards to establish requirements for recipients'
reporting of information on subawards and executive total compensation,
as required by the Federal Funding Accountability and Transparency Act
of 2006 (Pub. L. 109-282), as amended by section 6202 of Public Law
110-252, hereafter referred to as ``the Transparency Act''.
0
31. Revise Sec. 170.105 to read as follows:
Sec. 170.105 Types of awards to which this part applies.
This part applies to a Federal awarding agency's grants,
cooperative agreements, loans, and other forms of Federal financial
assistance subject to the Transparency Act, as defined in Sec.
170.320.
0
32. Revise Sec. 170.110 by revising paragraphs (a) and (b)(1),
paragraph (b)(2) introductory text, and paragraph (b)(3) to read as
follows:
Sec. 170.110 Types of entities to which this part applies.
(a) General. Through a Federal awarding agency's implementation of
the guidance in this part, this part applies to all non-Federal
entities and Federal agencies, other than those exempted by law or
excepted in paragraph (b) of this section, that--
(1) Apply for or receive Federal awards; or
(2) Receive subawards under Federal awards.
(b) * * * (1) None of the requirements in this part apply to an
individual who applies for or receives a Federal award as a natural
person (i.e., unrelated to any business or non-profit organization he
or she may own or operate in his or her name).
(2) None of the requirements regarding reporting names and total
compensation of a non-Federal entity's five most highly compensated
executives apply unless in the non-Federal entity's preceding fiscal
year, it received--
* * * * *
(3) The public does not have access to information about the
compensation of senior executives, unless otherwise publically
available, through periodic reports filed under section 13(a) or 15(d)
of the Securities Exchange Act of 1934 (15 U.S.C. 78m(a), 78o(d)) or
section 6104 of the Internal Revenue Code of 1986.
0
33. Revise Sec. 170.200 to read as follows:
Sec. 170.200 Federal awarding agency reporting requirements.
(a) Federal awarding agencies are required to publically report
Federal awards that equal or exceed the micro-purchase threshold and
publish the required information on a public-facing, OMB-designated,
governmentwide website and follow other relevant OMB guidance to
support Transparency Act implementation.
(b) Federal awarding agencies that obtain post-award data on
subaward obligations outside of this policy should take the necessary
steps to ensure that their recipients are not required, due to the
combination of agency-specific and Transparency Act reporting
requirements, to submit the same or similar data multiple times during
a given reporting period.
0
34. Add Sec. 170.210 to subpart B to read as follows:
Sec. 170.210 Requirements for notices of funding opportunities,
regulations, and application instructions.
(a) Each Federal awarding agency that makes awards of Federal
financial assistance subject to the Transparency Act must include the
requirements described in paragraph (b) of this section in each notice
of funding opportunity, regulation, or other issuance containing
instructions for applicants and is issued on or after the effective
date of this part.
(b) The notice of funding opportunity, regulation, or other
issuance must require each non-Federal entity that applies and for
Federal financial assistance and that does not have an exception under
Sec. 170.110(b) to ensure they have the necessary processes and
systems in place to comply with the reporting requirements should they
receive funding.
0
35. Revise Sec. 170.220 to read as follows:
Sec. 170.220 Award term.
(a) To accomplish the purposes described in Sec. 170.100, a
Federal awarding agency must include the award term in Appendix A to
this part in each Federal award to a non-Federal entity and Federal
agency under which the total funding is anticipated to equal or exceed
$30,000 in Federal funding.
(b) A Federal awarding agency, consistent with paragraph (a) of
this section, is not required to include the award term in Appendix A
to this part if it determines there is no possibility that the total
amount of Federal funding under the Federal award will equal or exceed
$30,000. However, the Federal awarding agency must subsequently modify
the award to add the award term if changes in circumstances increase
the total Federal funding under the award is anticipated to equal or
exceed $30,000 during the period of performance.
0
36. Revise Sec. 170.300 to read as follows:
Sec. 170.300 Federal awarding agency.
Federal awarding agency has the meaning given in 2 CFR 200.1.
0
37. Revise Sec. 170.305 to read as follows:
Sec. 170.305 Federal award.
Federal award, for the purposes of this part, means an award of
Federal financial assistance that a non-Federal entity or Federal
agency receives directly from a Federal awarding agency.
0
38. Add Sec. 170.307 to subpart C to read as follows:
Sec. 170.307 Foreign organization.
Foreign organization has the meaning given in 2 CFR 200.1.
0
39. Add Sec. 170.308 to subpart C to read as follows:
Sec. 170.308 Federal public entity.
Foreign public entity has the meaning given in 2 CFR 200.1.
0
40. Revise Sec. 170.310 to read as follows:
Sec. 170.310 Non-Federal entity.
Non-Federal entity has the meaning given in 2 CFR 200.1 and also
includes all of the following, for purposes of this part:
(a) A foreign organization;
[[Page 3778]]
(b) A foreign public entity; and
(c) A domestic or foreign for-profit organization.
0
41. Revise Sec. 170.320 to read as follows:
Sec. 170.320 Federal financial assistance subject to the
Transparency Act.
Federal financial assistance subject to the Transparency Act has
the meaning given in 2 CFR 200.1. Federal financial assistance, for
purposes of this part, does not include--
(a) Technical assistance, which provides services in lieu of money;
(b) A transfer of title to Federally owned property provided in
lieu of money, even if the award is called a grant;
(c) Any classified award; or
(d) Any award funded in whole or in part with Recovery funds, as
defined in section 1512 of the American Recovery and Reinvestment Act
of 2009 (Pub. L. 111-5).
0
42. Revise Sec. 170.325 to read as follows:
Sec. 170.325 Subaward.
Subaward has the meaning given in 2 CFR 200.1.
0
43. Amend Appendix A to part 179 by revising paragraphs (a)(1),
paragraph (b) introductory text, paragraphs (b)(1)(i), paragraph
(b)(1)(ii) introductory text, (b)(1)(iii), paragraph (c)(1)
introductory text, paragraph (c)(1)(ii), paragraph (e)(1) introductory
text, paragraph (e)(1)(iii), (e)(3)(ii), and (e)(4) and removing
(e)(1)(v) to read as follows:
Appendix A to Part 170--Award Term
(I) * * *
(a) * * *
(1) Applicability. Unless you are exempt as provided in
paragraph d. of this award term, you must report each action that
equals or exceeds $30,000 in Federal funds that does not include
Recovery funds (as defined in section 1512(a)(2) of the American
Recovery and Reinvestment Act of 2009, Pub. L. 111-5) for a subaward
to a non-Federal entity or Federal agency (see definitions in
paragraph e. of this award term).
* * * * *
(b) Reporting total compensation of recipient executives for
non-Federal entities.
(1) * * *
(i) The total Federal funding authorized to date under this
Federal award that equals or exceeds $30,000 as defined in 2 CFR
170.322;
(ii) In the preceding fiscal year, you received--
* * * * *
(iii) The public does not have access to information about the
compensation of the executives through periodic reports filed under
section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15
U.S.C. 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code
of 1986. (To determine if the public has access to the compensation
information, see the U.S. Security and Exchange Commission total
compensation filings at http://www.sec.gov/answers/execcomp.htm.)
* * * * *
(c) * * *
(1) Applicability and what to report. Unless you are exempt as
provided in paragraph d. of this award term, for each first-tier
non-Federal entity subrecipient under this award, you shall report
the names and total compensation of each of the subrecipient's five
most highly compensated executives for the subrecipient's preceding
completed fiscal year, if--
* * * * *
(ii) The public does not have access to information about the
compensation of the executives through periodic reports filed under
section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15
U.S.C. 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code
of 1986. (To determine if the public has access to the compensation
information, see the U.S. Security and Exchange Commission total
compensation filings at http://www.sec.gov/answers/execcomp.htm.)
* * * * *
(e) * * *
(1) Non-Federal entity means all of the following as defined in
2 CFR part 25:
* * * * *
(iii) A domestic or foreign nonprofit organization; and
(iv) A domestic or foreign for-profit organization
* * * * *
(3) * * *
(ii) The term does not include your procurement of property and
services needed to carry out the project or program (for further
explanation, see 2 CFR 200.330).
* * * * *
(4) Subrecipient means a non-Federal entity or Federal agency
that:
* * * * *
0
44. Add part 183 to read as follows:
PART 183--NEVER CONTRACT WITH THE ENEMY
Sec.
183.5 Purpose of this part.
183.10 Applicability.
183.15 Responsibilities of Federal awarding agencies.
183.20 Reporting responsibilities of Federal Awarding Agencies.
183.25 Responsibilities of non-Federal entities.
183.30 Access to records.
183.35 Definitions.
Appendix to Part 183--Clauses for Award Agreements
Authority: Pub. L. 113-291.
Sec. 183.5 Purpose of this part.
This part provides Office of Management and Budget (OMB) guidance
for Federal awarding agencies on applying Never Contract with the Enemy
to grants and cooperative agreements, as required by subtitle E, title
VIII of the National Defense Authorization Act (NDAA) for Fiscal Year
(FY) 2015 (Pub. L. 113-291).
Sec. 183.10 Applicability.
(a) Part 183 applies only to grants and cooperative agreements that
are expected to exceed $50,000 and that are performed outside the
United States, including U.S. territories, and that are in support of a
contingency operation in which members of the Armed Forces are actively
engaged in hostilities. It does not apply to the authorized
intelligence or law enforcement activities of the Federal Government.
(b) All elements of part 183 are applicable until December 31,
2019, except for Access to Records which has no sunset date.
Sec. 183.15 Responsibilities of Federal awarding agencies.
(a) Prior to making an award for a covered grant or cooperative
agreement that meets the thresholds in Sec. 183.10 for Never Contract
with the Enemy, the Federal awarding agency must check the current list
of prohibited or restricted persons or entities in the System Award
Management (SAM) Exclusions. If a person or entity is on the current
list of prohibited or restricted persons or entities in SAM Exclusions
pursuant to Never Contract with the Enemy, the agency must not make an
award.
(b) The Federal awarding agency must include a clause in all
covered grant and cooperative agreement awards in accordance with Never
Contract with the Enemy (see Appendix A of this part).
(c) A Federal awarding agency may become aware of a person or
entity that:
(1) Provides funds, including goods and services, received under a
covered grant or cooperative agreement of an executive agency directly
or indirectly to persons or entities that are actively opposing United
States or coalition forces involved in a contingency operation in which
members of the Armed Forces are actively engaged in hostilities; or
(2) Fails to exercise due diligence to ensure that none of the
funds, including goods and services, received under a covered grant or
cooperative agreement of an executive agency are provided directly or
indirectly to persons or entities that are actively opposing United
States or coalition forces involved in a contingency operation in which
members of the Armed Forces are actively engaged in hostilities.
(d) When a Federal awarding agency becomes aware of such a person
or
[[Page 3779]]
entity, it may do any of the following actions:
(1) Restrict the future award of all Federal grants and cooperative
agreements to the person or entity based upon concerns that Federal
awards to the entity would provide grant funds directly or indirectly
to a covered person or entity.
(2) Terminate any grant or cooperative agreement upon becoming
aware that the non-Federal recipient has failed to exercise due
diligence to ensure that none of the award funds are provided directly
or indirectly to a covered person or entity.
(e) The Federal awarding agency must notify non-Federal entities in
writing regarding its decision to restrict all future awards and/or to
terminate a grant. The agency must also notify the non-Federal entity
in writing about the non-Federal entity's right to request an
administrative review (using the agency's procedures) of the
restriction or termination of the grant or cooperative agreement within
30 days of receiving notification.
Sec. 183.20 Reporting responsibilities of Federal awarding agencies.
(a) If a Federal awarding agency restricts all future awards to a
covered person or entity in accordance with Never Contract with the
Enemy, it must enter information on the ineligible person or entity
into SAM Exclusions as a prohibited or restricted source pursuant to
Subtitle E, Title VIII of the NDAA for FY 2015 (Pub. L. 113-291).
(b) When a Federal awarding agency terminates a grant or
cooperative agreement due to Never Contract with the Enemy, it must
report the termination as a Termination for Material Failure to Comply
in the OMB-designated integrity and performance system accessible
through SAM (currently the Federal Awardee Performance and Integrity
Information System (FAPIIS)).
(c) The Federal awarding agency must report in writing any action
to restrict all future awards or to terminate the award. The Federal
awarding agency must also report in writing any decision not to
restrict all future awards or terminate an award along with the
agency's reasoning for not taking one of these actions after the agency
became aware that a person or entity is a prohibited or restricted
source pursuant to Subtitle E Title VIII of the NDAA for FY 2015 (Pub.
L. 113-291). The Federal awarding agency shall submit these reports to
the head of the executive agency concerned (or the designee of such
head) and the commander of the covered combatant command concerned (or
specific deputies). See section 843(4) of the NDAA for FY 2015 for
definition of covered combatant command: https://www.armed-services.senate.gov/imo/media/doc/CPRT-113-HPRT-RU00-S1847.pdf. See
section 841(h)(3) of the NDAA for FY 2015: https://www.armed-services.senate.gov/imo/media/doc/CPRT-113-HPRT-RU00-S1847.pdf.
(d) For each instance in which an executive agency exercised the
authority to restrict all future awards or to terminate, or a grant or
cooperative agreement, the agency must report in writing the following
to the head of the executive agency concerned (or the designee of such
head) and the commander of the covered combatant command concerned (or
specific deputies). See section 841(h)(3) of the NDAA for FY 2015:
https://www.armed-services.senate.gov/imo/media/doc/CPRT-113-HPRT-RU00-S1847.pdf:
(1) The executive agency taking such action.
(2) An explanation of the basis for the action taken.
(3) The value of the grant or cooperative agreement terminated.
(4) The value of all grants and cooperative agreements of the
executive agency with the person or entity concerned at the time the
grant or cooperative agreement was terminated.
(e) For each instance in which the Federal awarding agency did not
exercise the authority to terminate or restrict a grant or cooperative
agreement after becoming aware that a person or entity is a prohibited
or restricted source pursuant to Subtitle E Title VIII of the NDAA for
FY 2015 (Pub. L. 113-291), the Federal awarding agency must report in
writing to the head of the executive agency concerned (or the designee
of such head) and the commander of the covered combatant command
concerned (or specific deputies) the following. (See section 841(h)(3)
of the NDAA for FY 2015: https://www.armed-services.senate.gov/imo/media/doc/CPRT-113-HPRT-RU00-S1847.pdf):
(1) The executive agency concerned.
(2) An explanation of the basis for not taking the action.
(f) For each instance in which an executive agency exercised the
additional authority to examine grantee and subaward records, the
agency must report in writing to the head of the executive agency
concerned (or the designee of such head) and the commander of the
covered combatant command concerned (or specific deputies) the
following (See section 841(h)(3) of the NDAA for FY 2015: https://www.armed-services.senate.gov/imo/media/doc/CPRT-113-HPRT-RU00-S1847.pdf):
(1) An explanation of the basis for the action taken; and
(2) A summary of the results of any examination of records.
Sec. 183.25 Responsibilities of non-Federal entities.
Non-Federal entities must include two clauses in all covered
subawards in accordance with Never Contract with the Enemy (see
appendix to this Part).
Sec. 183.30 Access to records.
In addition to any other existing examination-of-records authority,
the Federal Government is authorized to examine any records of the
recipient and its subawards, to the extent necessary, to ensure that
funds, including supplies and services, received under a covered grant
or cooperative agreement (see Sec. 183.30) are not provided directly
or indirectly to a covered person or entity in accordance with Never
Contract with the Enemy. The Federal awarding agency may only exercise
this authority upon a written determination by the Federal awarding
agency that relies on a finding by the commander of a covered combatant
command that there is reason to believe that funds, including supplies
and services, received under the grant or cooperative agreement may
have been provided directly or indirectly to a covered person or
entity.
Sec. 183.35 Definitions.
Terms used in this part are defined as follows:
Contingency operation, as defined in 10 U.S.C. 101a, means a
military operation that--
(1) Is designated by the Secretary of Defense as an operation in
which members of the armed forces are or may become involved in
military actions, operations, or hostilities against an enemy of the
United States or against an opposing military force; or
(2) Results in the call or order to, or retention on, active duty
of members of the uniformed services under 10 U.S.C. 688, 12301a,
12302, 12304, 12304a, 12305, 12406 of 10 U.S.C. chapter 15, 14 U.S.C.
712 or any other provision of law during a war or during a national
emergency declared by the President or Congress.
Covered combatant command means the following:
(1) The United States Africa Command
(2) The United States Central Command
(3) The United States European Command
[[Page 3780]]
(4) The United States Pacific Command
(5) The United States Southern Command
(6) The United States Transportation Command.
Covered grant, cooperative agreement means a grant or cooperative
agreement, as defined in 2 CFR 200.1 with an estimated value in excess
of $50,000 that is performed outside the United States, including its
possessions and territories, in support of a contingency operation in
which members of the Armed Forces are actively engaged in hostilities.
Except for U.S. Department of Defense grants and cooperative agreements
that were awarded on or before December 19, 2017 that will be performed
in the United States Central Command, where the estimated value is in
excess of $100,000.
Covered person or entity means a person or entity that is actively
opposing United States or coalition forces involved in a contingency
operation in which members of the Armed Forces are actively engaged in
hostilities.
Appendix to Part 183--Clauses for Award Agreements
Federal awarding agencies must include the following two clauses
in all awards for covered grants and cooperative agreements in
accordance with Never Contract with the Enemy:
Clause 1:
Prohibition on Providing Funds to the Enemy
(a) The non-Federal Entity must--
(1) Exercise due diligence to ensure that none of the funds,
including supplies and services, received under this grant or
cooperative agreement are provided directly or indirectly (including
through subawards or contracts) to a person or entity who is
actively opposing the United States or Coalition forces involved in
a contingency operation in which members of the Armed Forces are
actively engaged in hostilities;
(2) Check the list of prohibited/restricted sources in the
System for Award Management (SAM) at www.sam.gov--
(i) Prior to issuing a subaward or contract; and
(ii) At least on a monthly basis; and
(3) Terminate in whole or in part any subaward or contract with
a person or entity listed in SAM as a prohibited or restricted
source pursuant to subtitle E of Title VIII of the NDAA for FY 2015,
unless the Federal awarding agency provides written approval to
continue the subaward or contract.
(4) Include the substance of this clause, including this
paragraph (a), in subawards under this grant or cooperative
agreement that have an estimated value over $50,000 and will be
performed outside the United States, including its outlying areas.
(b) The Federal awarding agency has the authority to terminate
this grant or cooperative agreement, in whole or in part, if the
Federal awarding agency becomes aware that the grantee failed to
exercise due diligence as required by paragraph (a) of this clause
or if the Federal awarding agency becomes aware that any funds
received under this grant or cooperative agreement have been
provided directly or indirectly to a person or entity who is
actively opposing or Coalition forces involved in a contingency
operation in which members of the Armed Forces are actively engaged
in hostilities.
(End of clause)
Clause 2:
Additional Access to Non-Federal Entity Records
(a) In addition to any other existing examination-of-records
authority, the Federal Government is authorized to examine any
records of the non-Federal entity and its subawards or contracts to
the extent necessary to ensure that funds, including supplies and
services, available under this grant or cooperative agreement are
not provided, directly or indirectly, to a person or entity that is
actively opposing United States or coalition forces involved in a
contingency operation in which members of the Armed Forces are
actively engaged in hostilities, except for awards awarded by the
Department of Defense on or before Dec 19, 2017 that will be
performed in the United States Central Command (USCENTCOM) theater
of operations.
(b) The substance of this clause, including this paragraph (b),
is required to be included in subawards or contracts under this
grant or cooperative agreement that have an estimated value over
$50,000 and will be performed outside the United States, including
its outlying areas.
PART 200--UNIFORM ADMINISTRATIVE REQUIREMENTS, COST PRINCIPLES, AND
AUDIT REQUIREMENTS FOR FEDERAL AWARDS
0
45. The authority citation for part 200 continues to read as follows:
Authority: 31 U.S.C. 503.
0
46. Amend Sec. 200.0 by adding in alphabetical order the acronym NFE
and revising the existing acronym SAM.
Sec. 200.0 Acronyms.
* * * * *
NFE Non-Federal Entity
* * * * *
SAM System for Award Management
* * * * *
0
47. Revise Sec. 200.1 to read as follows:
Sec. 200.1 Definitions
These are the definitions for terms used in this part. Different
definitions may be found in Federal statutes or regulations that apply
more specifically to particular programs or activities. These
definitions could be supplemented by additional instructional
information provided in governmentwide standard information
collections.
Acquisition cost means the cost of the asset including the cost to
ready the asset for its intended use. Acquisition cost for equipment,
for example, means the net invoice price of the equipment, including
the cost of any modifications, attachments, accessories, or auxiliary
apparatus necessary to make it usable for the purpose for which it is
acquired. Acquisition costs for software includes those development
costs capitalized in accordance with generally accepted accounting
principles (GAAP). Ancillary charges, such as taxes, duty, protective
in transit insurance, freight, and installation may be included in or
excluded from the acquisition cost in accordance with the non-Federal
entity's regular accounting practices.
Advance payment means a payment that a Federal awarding agency or
pass-through entity makes by any appropriate payment mechanism,
including a predetermined payment schedule, before the non-Federal
entity disburses the funds for program purposes.
Allocation means the process of assigning a cost, or a group of
costs, to one or more cost objective(s), in reasonable proportion to
the benefit provided or other equitable relationship. The process may
entail assigning a cost(s) directly to a final cost objective or
through one or more intermediate cost objectives.
Assistance listings refers to the publically available listing of
Federal assistance programs managed and administered by the General
Services Administration. Formally known as the Catalog of Federal
Domestic Assistance (CFDA).
Assistance listing number means a unique number assigned to
identify a Federal assistance listing. Formerly known as the CFDA
Number.
Assistance listing program title means the title that corresponds
to the Federal Assistance number. Formerly known as the CFDA program
title.
Audit finding means deficiencies which the auditor is required by
Sec. 200.516 Audit findings, paragraph (a) to report in the schedule
of findings and questioned costs.
Auditee means any non-Federal entity that expends Federal awards
which must be audited under subpart F of this part.
Auditor means an auditor who is a public accountant or a Federal,
state, local government, or Indian tribe audit organization, which
meets the general standards specified for external auditors in
generally accepted government auditing standards (GAGAS). The term
[[Page 3781]]
auditor does not include internal auditors of nonprofit organizations.
Budget means the financial plan for the Federal award that the
Federal awarding agency or pass-through entity approves during the
Federal award process or in subsequent amendments to the Federal award.
It may include the Federal and non-Federal share or only the Federal
share, as determined by the Federal awarding agency or pass-through
entity.
Budget period means the time interval during which recipients are
authorized to expend the current funds awarded and must meet the
matching or cost-sharing requirement, if any.
Central service cost allocation plan means the documentation
identifying, accumulating, and allocating or developing billing rates
based on the allowable costs of services provided by a state, local
government, or Indian tribe on a centralized basis to its departments
and agencies. The costs of these services may be allocated or billed to
users.
Capital assets means tangible or intangible assets used in
operations having a useful life of more than one year which are
capitalized in accordance with GAAP. Capital assets include:
(1) Land, buildings (facilities), equipment, and intellectual
property (including software) whether acquired by purchase,
construction, manufacture, exchange, or through a lease accounted for
as financed purchase under GASB standards or a finance lease under FSAB
standards; and
(2) Additions, improvements, modifications, replacements,
rearrangements, reinstallations, renovations or alterations to capital
assets that materially increase their value or useful life (not
ordinary repairs and maintenance). For purpose of this Part, capital
assets do not include intangible right-to-use assets (per GASB) and
right to use operating lease assets (per FASB). For example, assets
capitalized that recognize a leasse's right to control the use of
property and/or equipment for a period of time under a lease contract.
See also Sec. 200.465.
Capital expenditures means expenditures to acquire capital assets
or expenditures to make additions, improvements, modifications,
replacements, rearrangements, reinstallations, renovations, or
alterations to capital assets that materially increase their value or
useful life.
Claim means, depending on the context, either:
(1) A written demand or written assertion by one of the parties to
a Federal award seeking as a matter of right:
(i) The payment of money in a sum certain;
(ii) The adjustment or interpretation of the terms and conditions
of the Federal award; or
(iii) Other relief arising under or relating to a Federal award.
(2) A request for payment that is not in dispute when submitted.
Class of Federal awards means a group of Federal awards either
awarded under a specific program or group of programs or to a specific
type of non-Federal entity or group of non-Federal entities to which
specific provisions or exceptions may apply.
Closeout means the process by which the Federal awarding agency or
pass-through entity determines that all applicable administrative
actions and all required work of the Federal award have been completed
and takes actions as described in Sec. 200.343.
Cluster of programs means a grouping of closely related programs
that share common compliance requirements. The types of clusters of
programs are research and development (R&D), student financial aid
(SFA), and other clusters. ``Other clusters'' are as defined by OMB in
the compliance supplement or as designated by a state for Federal
awards the state provides to its subrecipients that meet the definition
of a cluster of programs. When designating an ``other cluster,'' a
state must identify the Federal awards included in the cluster and
advise the subrecipients of compliance requirements applicable to the
cluster, consistent with Sec. 200.331(a). A cluster of programs must
be considered as one program for determining major programs, as
described in Sec. 200.518, and, with the exception of R&D as described
in Sec. 200.501(c), whether a program-specific audit may be elected.
Cognizant agency for audit means the Federal agency designated to
carry out the responsibilities described in Sec. 200.513(a). The
cognizant agency for audit is not necessarily the same as the cognizant
agency for indirect costs. A list of cognizant agencies for audit can
be found on the Federal Audit Clearinghouse (FAC) website.
Cognizant agency for indirect costs means the Federal agency
responsible for reviewing, negotiating, and approving cost allocation
plans or indirect cost proposals developed under this part on behalf of
all Federal agencies. The cognizant agency for indirect cost is not
necessarily the same as the cognizant agency for audit. For assignments
of cognizant agencies see the following:
(1) For IHEs: Appendix III to Part 200, paragraph C.11.
(2) For nonprofit organizations: Appendix IV to Part 200, paragraph
C.2.a.
(3) For state and local governments: Appendix V to Part 200,
paragraph F.1.
(4) For Indian tribes: Appendix VII to Part 200, paragraph D.1.
Computing devices means machines used to acquire, store, analyze,
process, and publish data and other information electronically,
including accessories (or ``peripherals'') for printing, transmitting
and receiving, or storing electronic information. See also Supplies and
Information technology systems.
Compliance supplement means an annually updated source of
information for auditors to understand the Federal program's
objectives, procedures, and compliance requirements relevant to the
audit, as well as audit objectives and suggested audit procedures for
determining compliance with the relevant Federal program Assistance
listing title and number.
Contract means, for the purpose of Federal financial assistance, a
legal instrument by which a non-Federal entity purchases property or
services needed to carry out the project or program under a Federal
award. The term as used in this part does not include a legal
instrument, even if the non-Federal entity considers it a contract,
when the substance of the transaction meets the definition of a Federal
award or subaward. (see also Subaward).
Contractor means an entity that receives a contract as defined in
this section.
Cooperative agreement means a legal instrument of financial
assistance between a Federal awarding agency or pass-through entity and
a non-Federal entity that, consistent with 31 U.S.C. 6302-6305:
(1) Is used to enter into a relationship the principal purpose of
which is to transfer anything of value from the Federal awarding agency
or pass-through entity to the non-Federal entity to carry out a public
purpose authorized by a law of the United States (see 31 U.S.C.
6101(3)); and not to acquire property or services for the Federal
Government or pass-through entity's direct benefit or use;
(2) Is distinguished from a grant in that it provides for
substantial involvement between the Federal awarding agency or pass-
through entity and the non-Federal entity in carrying out the activity
contemplated by the Federal award.
(3) The term does not include:
[[Page 3782]]
(i) A cooperative research and development agreement as defined in
15 U.S.C. 3710a; or
(ii) An agreement that provides only:
(A) Direct United States Government cash assistance to an
individual;
(B) A subsidy;
(C) A loan;
(D) A loan guarantee; or
(E) Insurance.
Cooperative audit resolution means the use of audit follow-up
techniques which promote prompt corrective action by improving
communication, fostering collaboration, promoting trust, and developing
an understanding between the Federal agency and the non-Federal entity.
This approach is based upon:
(1) A strong commitment by Federal agency and non-Federal entity
leadership to program integrity;
(2) Federal agencies strengthening partnerships and working
cooperatively with non-Federal entities and their auditors; and non-
Federal entities and their auditors working cooperatively with Federal
agencies;
(3) A focus on current conditions and corrective action going
forward;
(4) Federal agencies offering appropriate relief for past
noncompliance when audits show prompt corrective action has occurred;
and
(5) Federal agency leadership sending a clear message that
continued failure to correct conditions identified by audits which are
likely to cause improper payments, fraud, waste, or abuse is
unacceptable and will result in sanctions.
Corrective action means action taken by the auditee that:
(1) Corrects identified deficiencies;
(2) Produces recommended improvements; or
(3) Demonstrates that audit findings are either invalid or do not
warrant auditee action.
Cost allocation plan means central service cost allocation plan or
public assistance cost allocation plan.
Cost objective means a program, function, activity, award,
organizational subdivision, contract, or work unit for which cost data
are desired and for which provision is made to accumulate and measure
the cost of processes, products, jobs, capital projects, etc. A cost
objective may be a major function of the non-Federal entity, a
particular service or project, a Federal award, or an indirect
(Facilities & Administrative (F&A)) cost activity, as described in
Subpart E of this part. See also Final cost objective and Intermediate
cost objective.
Cost sharing or matching means the portion of project costs not
paid by Federal funds (unless otherwise authorized by Federal statute).
See also Sec. 200.306.
Cross-cutting audit finding means an audit finding where the same
underlying condition or issue affects Federal awards of more than one
Federal awarding agency or pass-through entity.
Discretionary award means an award in which the awarding agency, in
keeping with specific statutory authority which enable the agency to
exercise judgement (``discretion'') in selection the grant award
recipient through a competitive process or based on merit of existing
grant recipients. Some discretionary grants to organizations may be
awarded on a non-competitive basis, often based on congressional
direction.
Disallowed costs means those charges to a Federal award that the
Federal awarding agency or pass-through entity determines to be
unallowable, in accordance with the applicable Federal statutes,
regulations, or the terms and conditions of the Federal award.
Equipment means tangible personal property (including information
technology systems) having a useful life of more than one year and a
per-unit acquisition cost which equals or exceeds the lesser of the
capitalization level established by the non-Federal entity for
financial statement purposes, or $5,000. See also Capital assets,
Computing devices, General purpose equipment, Information technology
systems, Special purpose equipment, and Supplies.
Expenditures means charges made by a non-Federal entity to a
project or program for which a Federal award was received.
(1) The charges may be reported on a cash or accrual basis, as long
as the methodology is disclosed and is consistently applied.
(2) For reports prepared on a cash basis, expenditures are the sum
of:
(i) Cash disbursements for direct charges for property and
services;
(ii) The amount of indirect expense charged;
(iii) The value of third-party in-kind contributions applied; and
(iv) The amount of cash advance payments and payments made to
subrecipients.
(3) For reports prepared on an accrual basis, expenditures are the
sum of:
(i) Cash disbursements for direct charges for property and
services;
(ii) The amount of indirect expense incurred;
(iii) The value of third-party in-kind contributions applied; and
(iv) The net increase or decrease in the amounts owed by the non-
Federal entity for:
(A) Goods and other property received;
(B) Services performed by employees, contractors, subrecipients,
and other payees; and
(C) Programs for which no current services or performance are
required such as annuities, insurance claims, or other benefit
payments.
Federal agency means an ``agency'' as defined at 5 U.S.C. 551(1)
and further clarified by 5 U.S.C. 552(f).
Federal Audit Clearinghouse (FAC) means the clearinghouse
designated by OMB as the repository of record where non-Federal
entities are required to transmit the information required by subpart F
of this part.
Federal awarding agency means the Federal agency that provides a
Federal award directly to a non-Federal entity.
Federal award has the meaning, depending on the context, in either
paragraph (1) or (2) of this definition:
(1)(i) The Federal financial assistance that a non-Federal entity
receives directly from a Federal awarding agency or indirectly from a
pass-through entity, as described in Sec. 200.101; or
(ii) The cost-reimbursement contract under the Federal Acquisition
Regulations that a non-Federal entity receives directly from a Federal
awarding agency or indirectly from a pass-through entity, as described
in Sec. 200.101.
(2) The instrument setting forth the terms and conditions. The
instrument is the grant agreement, cooperative agreement, other
agreement for assistance covered in paragraph (2) of the definition for
Federal financial assistance, or the cost-reimbursement contract
awarded under the Federal Acquisition Regulations.
(3) Federal award does not include other contracts that a Federal
agency uses to buy goods or services from a contractor or a contract to
operate Federal Government owned, contractor operated facilities
(GOCOs).
(4) See also definitions of Federal financial assistance, grant
agreement, and cooperative agreement.
Federal award date means the date when the Federal award is signed
by the authorized official of the Federal awarding agency.
(1) Federal financial assistance means assistance that non-Federal
entities receive or administer in the form of:
(i) Grants;
(ii) Cooperative agreements;
(iii) Non-cash contributions or donations of property (including
donated surplus property);
[[Page 3783]]
(iv) Direct appropriations;
(v) Food commodities; and
(vi) Other financial assistance (except assistance listed in
paragraph (b) of this section).
(2) For Sec. 200.203 and Subpart F of this part, Federal financial
assistance also includes assistance that non-Federal entities receive
or administer in the form of:
(i) Loans;
(ii) Loan Guarantees;
(iii) Interest subsidies; and
(iv) Insurance.
(3) Federal financial assistance does not include amounts received
as reimbursement for services rendered to individuals as described in
Sec. 200.502(h) and (i).
Federal interest means, for purposes of Sec. 200.329 or when used
in connection with the acquisition or improvement of real property,
equipment, or supplies under a Federal award, the dollar amount that is
the product of the:
(1) Federal share of total project costs; and
(2) Current fair market value of the property, improvements, or
both, to the extent the costs of acquiring or improving the property
were included as project costs.
Federal program means:
(1) All Federal awards which are assigned a single Assistance
listing number.
(2) When no Assistance listing number is assigned, all Federal
awards to non-Federal entities from the same agency made for the same
purpose must be combined and considered one program.
(3) Notwithstanding paragraphs (1) and (2) of this definition, a
cluster of programs. The types of clusters of programs are:
(i) Research and development (R&D);
(ii) Student financial aid (SFA); and
(iii) ``Other clusters,'' as described in the definition of Cluster
of Programs.
Federal share means the portion of the federal award costs that are
paid using Federal funds.
Final cost objective means a cost objective which has allocated to
it both direct and indirect costs and, in the non-Federal entity's
accumulation system, is one of the final accumulation points, such as a
particular award, internal project, or other direct activity of a non-
Federal entity. See also the definitions for Cost objective and
Intermediate cost objective in this section.
Financial obligations, when used in connection with a non-Federal
entity or recipient's utilization of funds under a Federal award, means
orders placed for property and services, contracts and subawards made,
and similar transactions that require payment.
Fixed amount awards means a type of grant or cooperative agreement
under which the Federal awarding agency or pass-through entity provides
a specific level of support without regard to actual costs incurred
under the Federal award. This type of Federal award reduces some of the
administrative burden and record-keeping requirements for both the non-
Federal entity and Federal awarding agency or pass-through entity.
Accountability is based primarily on performance and results. See
Sec. Sec. 200.201, 200.332(b) and 200.102(d).
Foreign public entity means:
(1) A foreign government or foreign governmental entity;
(2) A public international organization, which is an organization
entitled to enjoy privileges, exemptions, and immunities as an
international organization under the International Organizations
Immunities Act (22 U.S.C. 288-288f);
(3) An entity owned (in whole or in part) or controlled by a
foreign government; or
(4) Any other entity consisting wholly or partially of one or more
foreign governments or foreign governmental entities.
Foreign organization means an entity that is:
(1) A public or private organization located in a country other
than the United States and its territories that is subject to the laws
of the country in which it is located, irrespective of the citizenship
of project staff or place of performance;
(2) A private nongovernmental organization located in a country
other than the United States that solicits and receives cash
contributions from the general public;
(3) A charitable organization located in a country other than the
United States that is nonprofit and tax exempt under the laws of its
country of domicile and operation, and is not a university, college,
accredited degree-granting institution of education, private
foundation, hospital, organization engaged exclusively in research or
scientific activities, church, synagogue, mosque or other similar
entities organized primarily for religious purposes; or
(4) An organization located in a country other than the United
States not recognized as a Foreign Public Entity.
General purpose equipment means equipment which is not limited to
research, medical, scientific or other technical activities. Examples
include office equipment and furnishings, modular offices, telephone
networks, information technology equipment and systems, air
conditioning equipment, reproduction and printing equipment, and motor
vehicles. See also Equipment and Special Purpose Equipment.
GAAP has the meaning specified in accounting standards issued by
the Government Accounting Standards Board (GASB) and the Financial
Accounting Standards Board (FASB).
GAGAS, also known as the Yellow Book, means generally accepted
government auditing standards issued by the Comptroller General of the
United States, which are applicable to financial audits.
Grant agreement means a legal instrument of financial assistance
between a Federal awarding agency or pass-through entity and a non-
Federal entity that, consistent with 31 U.S.C. 6302, 6304:
(1) Is used to enter into a relationship the principal purpose of
which is to transfer anything of value from the Federal awarding agency
or pass-through entity to the non-Federal entity to carry out a public
purpose authorized by a law of the United States (see 31 U.S.C.
6101(3)); and not to acquire property or services for the Federal
awarding agency or pass-through entity's direct benefit or use;
(2) Is distinguished from a cooperative agreement in that it does
not provide for substantial involvement between the Federal awarding
agency or pass-through entity and the non-Federal entity in carrying
out the activity contemplated by the Federal award.
(3) Does not include an agreement that provides only:
(i) Direct United States Government cash assistance to an
individual;
(ii) A subsidy;
(iii) A loan;
(iv) A loan guarantee; or
(v) Insurance.
Highest level owner means the entity that owns or controls an
immediate owner of the offeror, or that owns or controls one or more
entities that control an immediate owner of the offeror. No entity owns
or exercises control of the highest-level owner as defined in the FAR
(48 CFR 52 204-17).
Hospital means a facility licensed as a hospital under the law of
any state or a facility operated as a hospital by the United States, a
state, or a subdivision of a state.
Improper payment. See definition of improper payment in OMB
Circular A-123 Appendix C, Part I A (2) ``What is an improper
payment?'' Questioned costs are not an improper payment until reviewed
and confirmed to be improper as defined in OMB Circular A-123 Appendix
C.
[[Page 3784]]
Indian tribe means any Indian tribe, band, nation, or other
organized group or community, including any Alaska Native village or
regional or village corporation as defined in or established pursuant
to the Alaska Native Claims Settlement Act (43 U.S.C. Chapter 33),
which is recognized as eligible for the special programs and services
provided by the United States to Indians because of their status as
Indians (25 U.S.C. 450b(e)). See annually published Bureau of Indian
Affairs list of Indian Entities Recognized and Eligible to Receive
Services.
Institutions of Higher Education (IHEs) is defined at 20 U.S.C.
1001.
Indirect (facilities & administrative (F&A)) costs means those
costs incurred for a common or joint purpose benefitting more than one
cost objective, and not readily assignable to the cost objectives
specifically benefitted, without effort disproportionate to the results
achieved. To facilitate equitable distribution of indirect expenses to
the cost objectives served, it may be necessary to establish a number
of pools of indirect (F&A) costs. Indirect (F&A) cost pools must be
distributed to benefitted cost objectives on bases that will produce an
equitable result in consideration of relative benefits derived.
Indirect cost rate proposal means the documentation prepared by a
non-Federal entity to substantiate its request for the establishment of
an indirect cost rate as described in Appendix III to Part 200 through
Appendix VII to part 200, and Appendix IX to part 200.
Information technology systems means computing devices, ancillary
equipment, software, firmware, and similar procedures, services
(including support services), and related resources. See also Computing
devices and Equipment.
Intangible property means property having no physical existence,
such as trademarks, copyrights, patents and patent applications and
property, such as loans, notes and other debt instruments, lease
agreements, stock and other instruments of property ownership (whether
the property is tangible or intangible).
Intermediate cost objective means a cost objective that is used to
accumulate indirect costs or service center costs that are subsequently
allocated to one or more indirect cost pools or final cost objectives.
See also Cost objective and Final cost objective.
Internal controls for non-Federal entities means processes designed
and implemented by non-Federal entities to provide reasonable assurance
regarding the achievement of objectives in the following categories:
(1) Effectiveness and efficiency of operations;
(2) Reliability of reporting for internal and external use; and
(3) Compliance with applicable laws and regulations.
(4) Internal controls Federal awarding agencies are required to
follow are located in OMB Circular A-123.
Internal control over compliance requirements for Federal awards.
Federal awarding agencies are required to follow internal control
compliance requirements located in OMB Circular A-123.
Loan means a Federal loan or loan guarantee received or
administered by a non-Federal entity, except as used in the definition
of Program income in Sec. 200.1 Definitions.
(1) The term ``direct loan'' means a disbursement of funds by the
Federal Government to a non-Federal borrower under a contract that
requires the repayment of such funds with or without interest. The term
includes the purchase of, or participation in, a loan made by another
lender and financing arrangements that defer payment for more than 90
days, including the sale of a Federal Government asset on credit terms.
The term does not include the acquisition of a federally guaranteed
loan in satisfaction of default claims or the price support loans of
the Commodity Credit Corporation.
(2) The term ``direct loan obligation'' means a binding agreement
by a Federal awarding agency to make a direct loan when specified
conditions are fulfilled by the borrower.
(3) The term ``loan guarantee'' means any Federal Government
guarantee, insurance, or other pledge with respect to the payment of
all or a part of the principal or interest on any debt obligation of a
non-Federal borrower to a non-Federal lender, but does not include the
insurance of deposits, shares, or other withdrawable accounts in
financial institutions.
(4) The term ``loan guarantee commitment'' means a binding
agreement by a Federal awarding agency to make a loan guarantee when
specified conditions are fulfilled by the borrower, the lender, or any
other party to the guarantee agreement.
Local government means any unit of government within a state,
including a:
(1) County;
(2) Borough;
(3) Municipality;
(4) City;
(5) Town;
(6) Township;
(7) Parish;
(8) Local public authority, including any public housing agency
under the United States Housing Act of 1937;
(9) Special district;
(10) School district;
(11) Intrastate district;
(12) Council of governments, whether or not incorporated as a
nonprofit corporation under state law; and
(13) Any other agency or instrumentality of a multi-, regional, or
intra-state or local government.
Major program means a Federal program determined by the auditor to
be a major program in accordance with Sec. 200.518 or a program
identified as a major program by a Federal awarding agency or pass-
through entity in accordance with Sec. 200.503(e).
Management decision means the Federal awarding agency's or pass-
through entity's written determination, provided to the auditee, of the
adequacy of the auditee's proposed corrective actions to address the
findings, based on its evaluation of the audit findings and proposed
corrective actions.
Micro-purchase means a purchase of supplies or services, the
aggregate amount of which does not exceed the micro-purchase threshold.
Micro-purchase comprise a subset of a non-Federal entity's small
purchases as defined in Sec. 200.319. Micro-purchase threshold means
the dollar amount at or below which a non-Federal entity may purchase
property or services using micro-purchase procedures (see Sec.
200.319). Generally, the micro-purchase threshold for procurement
activities administered under Federal awards is not to exceed the
amount set by the Federal Acquisition Regulation (FAR) at 48 CFR 2.101
(unless a higher threshold is requested by the non-Federal entity and
approved by the cognizant agency).
Modified Total Direct Cost (MTDC) means all direct salaries and
wages, applicable fringe benefits, materials and supplies, services,
travel, and up to the first $25,000 of each subaward (regardless of the
period of performance of the subawards under the award). MTDC excludes
equipment, capital expenditures, charges for patient care, rental
costs, tuition remission, scholarships and fellowships, participant
support costs and the portion of each subaward in excess of $25,000.
Other items may only be excluded when necessary to avoid a serious
inequity in the distribution of indirect costs, and with the approval
of the cognizant agency for indirect costs.
Non-discretionary award means an award made by the awarding agency
as defined by statute to specific recipients, assuming recipient
application meets
[[Page 3785]]
eligibility and compliance requirements, such that in keeping with
specific statutory authority the agency has no ability to exercise
judgment (``discretion''), due to ``mandatory'' award requirements, in
selecting the applicant/recipient organization through a competitive
process. Non-discretionary awards can be both formula and non-formula
based.
Non-Federal entity (NFE) means a state, local government, Indian
tribe, Institutions of Higher Education (IHE), or nonprofit
organization that carries out a Federal award as a recipient or
subrecipient.
Nonprofit organization means any corporation, trust, association,
cooperative, or other organization, not including IHEs, that:
(1) Is operated primarily for scientific, educational, service,
charitable, or similar purposes in the public interest;
(2) Is not organized primarily for profit; and
(3) Uses net proceeds to maintain, improve, or expand the
operations of the organization.
Notice of funding opportunity means a formal announcement of the
availability of Federal funding through a financial assistance program
from a Federal awarding agency. The Notice of Funding Opportunity
announcement provides information on the award, who is eligible to
apply, the evaluation criteria for selection of an awardee, required
components of an application, and how to submit the application.
Office of Management and Budget (OMB) means the Executive Office of
the President, Office of Management and Budget.
Oversight agency for audit means the Federal awarding agency that
provides the predominant amount of funding directly (direct funding) to
a non-Federal entity not assigned a cognizant agency for audit. When
the direct funding represents less than 25 percent of the total funding
received from the non-Federal entity (as prime and subawards), then the
Federal agency with the predominant amount of funding is the designated
oversight agency for award. When there is no direct funding, the
Federal awarding agency which is the predominant source of pass-through
funding must assume the oversight responsibilities. The duties of the
oversight agency for audit and the process for any reassignments are
described in Sec. 200.513(b).
Pass-through entity (PTE) means a non-Federal entity that provides
a subaward to a subrecipient to carry out part of a Federal program.
Participant support costs means direct costs for items such as
stipends or subsistence allowances, travel allowances, and registration
fees paid to or on behalf of participants or trainees (but not
employees) in connection with conferences, or training projects.
Performance goal means a target level of performance expressed as a
tangible, measurable objective, against which actual achievement can be
compared, including a goal expressed as a quantitative standard, value,
or rate. In some instances (e.g., discretionary research awards), this
may be limited to the requirement to submit technical performance
reports (to be evaluated in accordance with agency policy).
Period of performance means the anticipated time interval between
the start and end date of an initial Federal award or Renewal. See also
Budget period and Renewal.
Personal property means property other than real property. It may
be tangible, having physical existence, or intangible.
Personally Identifiable Information (PII) means information that
can be used to distinguish or trace an individual's identity, either
alone or when combined with other personal or identifying information
that is linked or linkable to a specific individual. Some information
that is considered to be PII is available in public sources such as
telephone books, public websites, and university listings. This type of
information is considered to be Public PII and includes, for example,
first and last name, address, work telephone number, email address,
home telephone number, and general educational credentials. The
definition of PII is not anchored to any single category of information
or technology. Rather, it requires a case-by-case assessment of the
specific risk that an individual can be identified. Non-PII can become
PII whenever additional information is made publicly available, in any
medium and from any source, that, when combined with other available
information, could be used to identify an individual.
Program income means gross income earned by the non-Federal entity
that is directly generated by a supported activity or earned as a
result of the Federal award during the period of performance except as
provided in Sec. 200.307(f). (See Period of performance in Sec.
200.1) Program income includes but is not limited to income from fees
for services performed, the use or rental or real or personal property
acquired under Federal awards, the sale of commodities or items
fabricated under a Federal award, license fees and royalties on patents
and copyrights, and principal and interest on loans made with Federal
award funds. Interest earned on advances of Federal funds is not
program income. Except as otherwise provided in Federal statutes,
regulations, or the terms and conditions of the Federal award, program
income does not include rebates, credits, discounts, and interest
earned on any of them. See also Sec. 200.407 Prior written approval
(prior approval). See also 35 U.S.C. 200-212 ``Disposition of Rights in
Educational Awards'' applies to inventions made under Federal awards.
Property means real property or personal property. See also Real
property and personal property.
Protected Personally Identifiable Information (Protected PII) means
an individual's first name or first initial and last name in
combination with any one or more of types of information, including,
but not limited to, social security number, passport number, credit
card numbers, clearances, bank numbers, biometrics, date and place of
birth, mother's maiden name, criminal, medical and financial records,
educational transcripts. This does not include PII that is required by
law to be disclosed. See also Personally Identifiable Information
(PII).
Project cost means total allowable costs incurred under a Federal
award and all required cost sharing and voluntary committed cost
sharing, including third-party contributions.
Questioned cost means a cost that is questioned by the auditor
because of an audit finding:
(1) Which resulted from a violation or possible violation of a
statute, regulation, or the terms and conditions of a Federal award,
including for funds used to match Federal funds;
(2) Where the costs, at the time of the audit, are not supported by
adequate documentation; or
(3) Where the costs incurred appear unreasonable and do not reflect
the actions a prudent person would take in the circumstances.
(4) Questioned costs are not an improper payment until reviewed and
confirmed to be improper as defined in OMB Circular A-123 Appendix C.
(see also Improper payment)
Real property means land, including land improvements, structures
and appurtenances thereto, but excludes moveable machinery and
equipment.
Recipient means a non-Federal entity that receives a Federal award
directly from a Federal awarding agency. The term recipient does not
include subrecipients or an individual that is a beneficiary of the
award.
Renewal means a subsequent Federal award to a current Federal
award; each renewal must have a distinct period of performance.
[[Page 3786]]
Research and Development (R&D) means all research activities, both
basic and applied, and all development activities that are performed by
non-Federal entities. The term research also includes activities
involving the training of individuals in research techniques where such
activities utilize the same facilities as other research and
development activities and where such activities are not included in
the instruction function. ``Research'' is defined as a systematic study
directed toward fuller scientific knowledge or understanding of the
subject studied. ``Development'' is the systematic use of knowledge and
understanding gained from research directed toward the production of
useful materials, devices, systems, or methods, including design and
development of prototypes and processes.
Simplified acquisition threshold means the dollar amount below
which a non-Federal entity may purchase property or services using
small purchase methods (see Sec. 200.319). Non-Federal entities adopt
small purchase procedures in order to expedite the purchase of items at
or below the simplified acquisition threshold. The simplified
acquisition threshold for procurement activities administered under
Federal awards is set by the Federal Acquisition Regulation at 48 CFR
subpart 2.1. Thresholds differ from the FAR. The non-Federal entity is
responsible for determining an appropriate simplified acquisition
threshold based on internal controls, an evaluation of risk and its
documented procurement procedures. States, IHEs and local governments
should determine if local government laws on purchasing apply.
Special purpose equipment means equipment which is used only for
research, medical, scientific, or other technical activities. Examples
of special purpose equipment include microscopes, x-ray machines,
surgical instruments, and spectrometers. See also Equipment and General
purpose equipment.
State means any state of the United States, the District of
Columbia, the Commonwealth of Puerto Rico, U.S. Virgin Islands, Guam,
American Samoa, the Commonwealth of the Northern Mariana Islands, and
any agency or instrumentality thereof exclusive of local governments.
Student Financial Aid (SFA) means Federal awards under those
programs of general student assistance, such as those authorized by
Title IV of the Higher Education Act of 1965, as amended, (20 U.S.C.
1070-1099d), which are administered by the U.S. Department of
Education, and similar programs provided by other Federal agencies. It
does not include Federal awards under programs that provide fellowships
or similar Federal awards to students on a competitive basis, or for
specified studies or research.
Subaward means an award provided by a pass-through entity to a
subrecipient for the subrecipient to carry out part of a Federal award
received by the pass-through entity. It does not include payments to a
contractor or payments to an individual that is a beneficiary of a
Federal program. A subaward may be provided through any form of legal
agreement, including an agreement that the pass-through entity
considers a contract.
Subrecipient means an entity, usually but not limited to non-
Federal entities, that receives a subaward from a pass-through entity
to carry out part of a Federal award; but does not include an
individual that is a beneficiary of such award. A subrecipient may also
be a recipient of other Federal awards directly from a Federal awarding
agency.
Subsidiary means an entity in which more than 50 percent of the
non-Federal entity is owned directly by a parent corporation or through
another subsidiary of a parent corporation as defined in the FAR (48
CFR 52.209-10).
Supplies means all tangible personal property other than those
described in the definition of Equipment. A computing device is a
supply if the acquisition cost is less than the lesser of the
capitalization level established by the non-Federal entity for
financial statement purposes or $5,000, regardless of the length of its
useful life. See also Computing devices and Equipment.
Termination means the ending of a Federal award, in whole or in
part at any time prior to the planned end of period of performance. A
lack of available funds is not a termination.
Third-party in-kind contributions means the value of non-cash
contributions (i.e., property or services) that--
(1) Benefit a federally assisted project or program; and
(2) Are contributed by non-Federal third parties, without charge,
to a non-Federal entity under a Federal award.
Unliquidated financial obligations means, for financial reports
prepared on a cash basis, financial obligations incurred by the non-
Federal entity that have not been paid (liquidated). For reports
prepared on an accrual expenditure basis, these are financial
obligations incurred by the non-Federal entity for which an expenditure
has not been recorded.
Unobligated balance means the amount of funds under a Federal award
that the non-Federal entity has not obligated. The amount is computed
by subtracting the cumulative amount of the non-Federal entity's
unliquidated financial obligations and expenditures of funds under the
Federal award from the cumulative amount of the funds that the Federal
awarding agency or pass-through entity authorized the non-Federal
entity to obligate.
Voluntary committed cost sharing means cost sharing specifically
pledged on a voluntary basis in the proposal's budget on the part of
the non-Federal entity and that becomes a binding requirement of
Federal award. See also Sec. 200.306.
Sec. Sec. 200.2 through 200.99 [Removed]
0
48. Remove Sec. Sec. 200.2 through 200.99
0
49. Amend Sec. 200.100 by revising paragraph (a)(1) to read as follow:
Sec. 200.100 Purpose.
(a)(1) This part establishes uniform administrative requirements,
cost principles, and audit requirements for Federal awards to non-
Federal entities, as described in Sec. 200.101. Federal awarding
agencies must not impose additional or inconsistent requirements,
except as provided in Sec. Sec. 200.102 and 200.211, or unless
specifically required by Federal statute, regulation, or Executive
Order.
* * * * *
0
50. Revise Sec. 200.101 to read as follows:
Sec. 200.101 Applicability.
(a) General applicability to Federal agencies. (1) The requirements
established in this part apply to Federal agencies that make Federal
awards to non-Federal entities. These requirements are applicable to
all costs related to Federal awards.
(2) Federal awarding agencies may apply subparts A through E of
this part to Federal agencies, for-profit entities, foreign public
entities, or foreign organizations, except where the Federal awarding
agency determines that the application of these subparts would be
inconsistent with the international responsibilities of the United
States or the statutes or regulations of a foreign government.
(b) Applicability to different types of Federal awards. (1)
Throughout this part when the word ``must'' is used it indicates a
requirement. Whereas, use of the word ``should'' or ``may'' indicates a
best practice or recommended approach rather than a requirement and
permits discretion.
[[Page 3787]]
(2) The following table describes what portions of this part apply
to which types of Federal awards. The terms and conditions of Federal
awards (including this part) flow down to subawards to subrecipients
unless a particular section of this part or the terms and conditions of
the Federal award specifically indicate otherwise. This means that non-
Federal entities must comply with requirements in this part regardless
of whether the non-Federal entity is a recipient or subrecipient of a
Federal award. Pass-through entities must comply with the requirements
described in Subpart D of this part, Sec. Sec. 200.330 through
200.332, but not any requirements in this part directed towards Federal
awarding agencies unless the requirements of this part or the terms and
conditions of the Federal award indicate otherwise.
Table 1 to Paragraph (b)
------------------------------------------------------------------------
Are applicable to
the following types
of Federal Awards Are NOT applicable
and fixed-price to the following
The following portions of contracts and types of Federal
this part subcontracts (except Awards and fixed-
as noted in price contracts and
paragraphs (d) and subcontracts:
(e) below):
------------------------------------------------------------------------
Subpart A--Acronyms and --All...............
Definitions.
Subpart B--General --All...............
Provisions, except for Sec.
Sec. 200.111 English
Language, 200.112 Conflict
of Interest, 200.113
Mandatory Disclosures.
Sec. Sec. 200.111 English --Grant Agreements --Agreements for
Language, 200.112 Conflict and cooperative loans, loan
of Interest, 200.113 agreements. guarantees,
Mandatory Disclosures. interest subsidies
and insurance.
--Procurement
contracts awarded
by Federal Agencies
under the Federal
Acquisition
Regulation and
subcontracts under
those contracts.
Subparts C-D, except for --Grant Agreements --Agreements for
Sec. Sec. 200.203 and cooperative loans, loan
Requirement to provide agreements. guarantees,
public notice of Federal interest subsidies
financial assistance and insurance.
programs, 200.303 Internal --Procurement
controls, 200.330-332 contracts awarded
Subrecipient Monitoring and by Federal Agencies
Management. under the Federal
Acquisition
Regulation and
subcontracts under
those contracts.
Sec. 200.203 Requirement --Grant Agreements --Procurement
to provide public notice of and cooperative contracts awarded
Federal financial agreements. by Federal Agencies
assistance programs. --Agreements for under the Federal
loans, loan Acquisition
guarantees, Regulation and
interest subsidies subcontracts under
and insurance.. those contracts.
Sec. Sec. 200.303 --All...............
Internal controls, 200.330-
332 Subrecipient Monitoring
and Management.
Subpart E--Cost Principles.. --Grant Agreements --Grant agreements
and cooperative and cooperative
agreements, except agreements
those providing providing foods
food commodities. commodities.
--All procurement --Fixed amount
contracts under the awards.
Federal Acquisition --Agreements for
Regulations except loans, loans
those that are not guarantees,
negotiated. interest subsidies
and insurance.
--Federal awards to
hospitals (see
Appendix IX
Hospital Cost
Principles).
Subpart F--Audit --Grant Agreements --Fixed-price
Requirements. and cooperative contracts and
agreements. subcontracts
--Contracts and awarded under the
subcontracts, Federal Acquisition
except for fixed Regulation.
price contacts and
subcontracts,
awarded under the
Federal Acquisition
Regulation..
--Agreements for
loans, loans
guarantees,
interest subsidies
and insurance and
other forms of
Federal Financial
Assistance as
defined by the
Single Audit Act
Amendment of 1996.
------------------------------------------------------------------------
(c) Federal award of cost-reimbursement contract under the FAR to a
non-Federal entity. When a non-Federal entity is awarded a cost-
reimbursement contract, only Subpart D of this part, Sec. Sec. 200.330
through 200.332, subpart E of this part and subpart F of this part are
incorporated by reference into the contract, but the requirements of
subparts D, E, and F are supplementary to the FAR contract and only
have effect to the extent that they do not conflict with the FAR and
the contract. When the Cost Accounting Standards (CAS) are applicable
to the contract, they take precedence over the requirements of this
part, including subpart F of this part, which are supplementary to the
CAS requirements. In addition, costs that are made unallowable under 10
U.S.C. 2324(e) and 41 U.S.C. 4304(a) as described in the FAR 48 CFR
subpart 31.2 and 48 CFR 31.603 are always unallowable. For requirements
other than those covered in subpart D of this part, Sec. Sec. 200.330
through 200.332, subpart E of this part and subpart F of this part, the
terms of the contract and the FAR apply. Note that when a non-Federal
entity is awarded a FAR contract, the FAR applies, and the terms and
conditions of the contract shall prevail over the requirements of this
part.
(d) With the exception of subpart F of this part, which is required
by the Single Audit Act, in any circumstances where the provisions of
Federal statutes or regulations differ from the provisions of this
part, the provision of the Federal statutes or regulations govern. This
[[Page 3788]]
includes, for agreements with Indian tribes, the provisions of the
Indian Self-Determination and Education and Assistance Act (ISDEAA), as
amended, 25 U.S.C 450--458ddd-2.
(e) Except for Sec. 200.203, and Sec. Sec. 200.330 through
200.332, the requirements in Subpart C, Subpart D, and Subpart E of
this part do not apply to the following programs:
(1) The block grant awards authorized by the Omnibus Budget
Reconciliation Act of 1981 (including Community Services), except to
the extent that Subpart E--Cost Principles of this Part apply to
subrecipients of Community Services Block Grant funds pursuant to 42
U.S.C. 9916(a)(1)(B);
(2) Federal awards to local education agencies under 20 U.S.C.
7702-7703b, (portions of the Impact Aid program);
(3) Payments under the Department of Veterans Affairs' State Home
Per Diem Program (38 U.S.C. 1741); and
(4) Federal awards authorized under the Child Care and Development
Block Grant Act of 1990, as amended:
(i) Child Care and Development Block Grant (42 U.S.C. 9858)
(ii) Child Care Mandatory and Matching Funds of the Child Care and
Development Fund (42 U.S.C. 9858)
(f) Except for Sec. 200.203, the guidance in subpart C of this
part does not apply to the following programs:
(1) Entitlement Federal awards to carry out the following programs
of the Social Security Act:
(i) Temporary Assistance to Needy Families (title IV-A of the
Social Security Act, 42 U.S.C. 601-619);
(ii) Child Support Enforcement and Establishment of Paternity
(title IV-D of the Social Security Act, 42 U.S.C. 651-669b);
(iii) Foster Care and Adoption Assistance (title IV-E of the Act,
42 U.S.C. 670-679c);
(iv) Aid to the Aged, Blind, and Disabled (titles I, X, XIV, and
XVI-AABD of the Act, as amended);
(v) Medical Assistance (Medicaid) (title XIX of the Act, 42 U.S.C.
1396-1396w-5) not including the State Medicaid Fraud Control program
authorized by section 1903(a)(6)(B) of the Social Security Act (42
U.S.C. 1396b(a)(6)(B)); and
(vi) Children's Health Insurance Program (title XXI of the Act, 42
U.S.C. 1397aa-1397mm).
(2) A Federal award for an experimental, pilot, or demonstration
project that is also supported by a Federal award listed in paragraph
(e)(1) of this section;
(3) Federal awards under subsection 412(e) of the Immigration and
Nationality Act and subsection 501(a) of the Refugee Education
Assistance Act of 1980 (Pub. L. 96-422, 94 Stat. 1809), for cash
assistance, medical assistance, and supplemental security income
benefits to refugees and entrants and the administrative costs of
providing the assistance and benefits (8 U.S.C. 1522(e));
(4) Entitlement awards under the following programs of The National
School Lunch Act:
(i) National School Lunch Program (section 4 of the Act, 42 U.S.C.
1753),
(ii) Commodity Assistance (section 6 of the Act, 42 U.S.C. 1755),
(iii) Special Meal Assistance (section 11 of the Act, 42 U.S.C.
1759a),
(iv) Summer Food Service Program for Children (section 13 of the
Act, 42 U.S.C. 1761), and
(v) Child and Adult Care Food Program (section 17 of the Act, 42
U.S.C. 1766).
(5) Entitlement awards under the following programs of The Child
Nutrition Act of 1966:
(i) Special Milk Program (section 3 of the Act, 42 U.S.C. 1772),
(ii) School Breakfast Program (section 4 of the Act, 42 U.S.C.
1773), and
(iii) State Administrative Expenses (section 7 of the Act, 42
U.S.C. 1776).
(6) Entitlement awards for State Administrative Expenses under The
Food and Nutrition Act of 2008 (section 16 of the Act, 7 U.S.C. 2025).
(7) Non-discretionary Federal awards under the following non-
entitlement programs:
(i) Special Supplemental Nutrition Program for Women, Infants and
Children (section 17 of the Child Nutrition Act of 1966) 42 U.S.C.
1786;
(ii) The Emergency Food Assistance Programs (Emergency Food
Assistance Act of 1983) 7 U.S.C. 7501 note; and
(iii) Commodity Supplemental Food Program (section 5 of the
Agriculture and Consumer Protection Act of 1973) 7 U.S.C. 612c note.
0
51. Amend Sec. 200.102 by revising paragraphs (a), (c), and (d) to
read as follows:
Sec. 200.102 Exceptions.
(a) With the exception of subpart F of this part, OMB may allow
exceptions for classes of Federal awards or non-Federal entities
subject to the requirements of this part when exceptions are not
prohibited by statute. In the interest of maximum uniformity,
exceptions from the requirements of this part will be permitted only as
described in paragraph (d) of this section or in unusual circumstances.
* * * * *
(c) The Federal awarding agency may apply more or less restrictive
requirements to a class of Federal awards or non-Federal entities when
approved by OMB, or when, required by Federal statutes or regulations,
except for the requirements in subpart F of this part. A Federal
awarding agency may apply less restrictive requirements when making
fixed amount awards as defined in subpart A of this part, except for
those requirements imposed by statute or in subpart F of this part.
(d) OMB encourages Federal awarding agencies to request exceptions
in support of innovative program designs that apply a risk-based, data-
driven framework to alleviate select compliance requirements and hold
recipients accountable for good performance. OMB also encourages
agencies to apply more restrictive terms and conditions when a risk-
assessment indicates it may be merited.
0
52. Revise Sec. 200.110 to read as follows:
Sec. 200.110 Effective/applicability date.
(a) The standards set forth in this part that affect the
administration of Federal awards issued by Federal awarding agencies
become effective once implemented by Federal awarding agencies or when
any future amendment to this part becomes final.
(b) Existing negotiated indirect cost rates will remain in place
until they are re-negotiated. The effective date of changes to indirect
cost rates must be based upon the date that a newly re-negotiated rate
goes into effect for a specific non-Federal entity's fiscal year.
Therefore, for indirect cost rates and cost allocation plans, Federal
awarding and indirect cost rate negotiating agencies will use the
Uniform Guidance both in generating proposals for and negotiating a new
rate (when the rate is re-negotiated) for non-Federal entities.
0
53. Revise Subpart C to read as follows:
Subpart C--Pre-Federal Award Requirements and Contents of Federal
Awards
Sec.
200.200 Purpose.
200.201 Use of grant agreements (including fixed amount awards),
cooperative agreements, and contracts.
200.202 Program planning and design.
200.203 Requirement to provide public notice of Federal financial
assistance programs.
200.204 Notices of funding opportunities.
200.205 Federal awarding agency review of merit of proposals.
200.206 Federal awarding agency review of risk posed by applicants.
200.207 Standard application requirements.
200.208 Specific conditions.
200.209 Certifications and representations.
[[Page 3789]]
200.210 Pre-award costs.
200.211 Information contained in a Federal award.
200.212 Public access to Federal award information.
200.213 Reporting a determination that a non-Federal entity is not
qualified for a Federal award.
200.214 Suspension and debarment.
200.215 Never contract with the enemy.
200.216 Prohibition on certain telecommunications and video
surveillance services or equipment.
Sec. 200.200 Purpose.
(a) Sections 200.201 through 200.209 prescribe instructions and
other pre-award matters to be used in the announcement and application
process.
(b) Use of Sec. Sec. 200.204, 200.205, 200.206, and 200.208, is
required only for competitive Federal awards, but may also be used by
the Federal awarding agency for non-competitive awards where
appropriate or where required by Federal statute.
Sec. 200.201 Use of grant agreements (including fixed amount
awards), cooperative agreements, and contracts.
(a) The Federal awarding agency or pass-through entity must decide
on the appropriate instrument for the Federal award (i.e., grant
agreement, cooperative agreement, or contract) in accordance with the
Federal Grant and Cooperative Agreement Act (31 U.S.C. 6301-08).
(b) Fixed Amount Awards. In addition to the options described in
paragraph (a) of this section, Federal awarding agencies, or pass-
through entities as permitted in Sec. 200.332, may use fixed amount
awards (see Fixed amount awards in Sec. 200.1) to which the following
conditions apply:
(1) The Federal award amount is negotiated using the cost
principles (or other pricing information) as a guide. The Federal
awarding agency or pass-through entity may use fixed amount awards if
the project scope has measurable goals and objectives and if adequate
cost, historical, or unit pricing data is available to establish a
fixed amount award based on a reasonable estimate of actual cost.
Payments are based on meeting specific requirements of the Federal
award. Accountability is based on performance and results. Except in
the case of termination before completion of the Federal award, there
is no governmental review of the actual costs incurred by the non-
Federal entity in performance of the award. Some of the ways in which
the Federal award may be paid include, but are not limited to:
(i) In several partial payments, the amount of each agreed upon in
advance, and the ``milestone'' or event triggering the payment also
agreed upon in advance, and set forth in the Federal award;
(ii) On a unit price basis, for a defined unit or units, at a
defined price or prices, agreed to in advance of performance of the
Federal award and set forth in the Federal award; or,
(iii) In one payment at Federal award completion.
(2) A fixed amount award cannot be used in programs which require
mandatory cost sharing or match.
(3) The non-Federal entity must certify in writing to the Federal
awarding agency or pass-through entity at the end of the Federal award
that the project or activity was completed or the level of effort was
expended. If the required level of activity or effort was not carried
out, the amount of the Federal award must be adjusted.
(4) Periodic reports may be established for each Federal award.
(5) Changes in principal investigator, project leader, project
partner, or scope of effort must receive the prior written approval of
the Federal awarding agency or pass-through entity.
Sec. 200.202 Program planning and design.
In designing the Federal financial assistance programs, the Federal
awarding agency must establish program goals, objectives, and
indicators at the assistance listing (e.g., program) level, to the
extent permitted by law. Program design must occur before the Federal
awarding agency drafts the Notice of Funding Opportunity. The program
goals and outcomes designed must be aligned with the Congressional
intent of the program, agency leadership goals, as well as agency
strategic plan and priority goals. Programs must be designed with clear
goals and objectives to achieve intended results. Program goals,
objectives and metrics for measuring performance must also be published
in the assistance listing. Program design elements may include a
problem or needs statement, goals and objectives, a logic model
depicting the program's structure, program activities, performance
indicators to measure program accomplishments which may include
independently available sources of data, learning communities which may
benefit from a common understanding of promising practices, and a
system to periodically review award selection criteria. Federal
awarding agencies should use program design to inform the management of
Federal awards at all stages of the financial assistance lifecycle.
Federal awarding agencies are responsible for collecting relevant
performance data to demonstrate the results of Federal financial
assistance programs. Federal awarding agencies are also responsible for
ensuring taxpayer dollars are providing critical Federal services to
citizens efficiently and cost-effectively while managing government
programs, as described in the Program Management Improvement
Accountability Act (Pub. L. 114-264), the OMB Memorandum M-18-19
(Improving the Management of Federal Programs and Projects through
Implementing the Program Management Improvement Accountability Act) and
OMB circular A-11 (Preparation, Submission, and Execution of the
Budget). See also Sec. 200.1 Definition for Assistance listing.
Sec. 200.203 Requirement to provide public notice of Federal
financial assistance programs.
(a) The Federal awarding agency must notify the public of Federal
programs in the Assistance listings maintained by the General Services
Administration (GSA).
(1) The Assistance listings is the single, authoritative,
governmentwide comprehensive source of Federal financial assistance
program information produced by the executive branch of the Federal
Government.
(2) The information that the Federal awarding agency must submit to
GSA for approval by OMB is listed in paragraph (b) of this section. GSA
must prescribe the format for the submission in coordination with OMB.
(3) The Federal awarding agency may not award Federal financial
assistance without assigning it to a program that has been included in
the Assistance listings as required in this section unless there are
exigent circumstances requiring otherwise, such as timing requirements
imposed by statute.
(b) For each program that awards discretionary Federal awards, non-
discretionary Federal awards, loans, insurance, or any other type of
Federal financial assistance, the Federal awarding agency must, to the
extent practicable, create, updated, and manage Assistance listing
entries based on the authorizing statute for the program and comply
with additional guidance provided by GSA in consultation with OMB to
ensure consistent, accurate information is available to prospective
applicants. At a minimum, Federal awarding agencies must submit the
following information to GSA:
(1) Program description, purpose, goals and measurement. A brief
summary of the statutory or regulatory requirements of the program and
its intended outcome. Where appropriate,
[[Page 3790]]
the Program description, purpose, goals, and measurement should align
with the strategic goals and objectives within the Federal awarding
agency's performance plan as required by Part 6 of OMB Circular A-11
and should support the Federal awarding agency's performance
measurement, management, and any required reporting;
(2) Identification. Whether the program makes Federal awards on a
discretionary basis or the Federal awards are prescribed by Federal
statute, such as in the case of formula grants.
(3) Projected total amount of funds available for the program.
Estimates based on previous year funding are acceptable if current
appropriations are not available at the time of the submission;
(4) Anticipated source of available funds: The statutory authority
for funding the program and, to the extent possible, agency, sub-
agency, or, if known, the specific program unit that will issue the
Federal awards, and associated funding identifier (e.g., Treasury
Account Symbol(s));
(5) General eligibility requirements: The statutory, regulatory or
other eligibility factors or considerations that determine the
applicant's qualification for Federal awards under the program (e.g.,
type of non-Federal entity); and
(6) Applicability. The applicability of Single Audit Requirements
as required by subpart F of this part.
Sec. 200.204 Notices of funding opportunities.
For discretionary grants and cooperative agreements, the Federal
awarding agency must announce specific funding opportunities by
providing the following information in a public notice:
(a) Summary information in notices of funding opportunities. The
Federal awarding agency must display the following information posted
on the OMB-designated governmentwide website for finding and applying
for Federal financial assistance, in a location preceding the full text
of the announcement:
(1) Federal Awarding Agency Name;
(2) Funding Opportunity Title;
(3) Announcement Type (whether the funding opportunity is the
initial announcement of this funding opportunity or a modification of a
previously announced opportunity);
(4) Funding Opportunity Number (required, if applicable). If the
Federal awarding agency has assigned or will assign a number to the
funding opportunity announcement, this number must be provided;
(5) Assistance listing number(s);
(6) Key Dates. Key dates include due dates for applications or
Executive Order 12372 submissions, as well as for any letters of intent
or pre-applications. For any announcement issued before a program's
application materials are available, key dates also include the date on
which those materials will be released; and any other additional
information, as deemed applicable by the relevant Federal awarding
agency.
(b) Availability period. The Federal awarding agency must generally
make all funding opportunities available for application for at least
60 calendar days. The Federal awarding agency may make a determination
to have a less than 60 calendar day availability period but no funding
opportunity should be available for less than 30 calendar days unless
exigent circumstances require as determined by the Federal awarding
agency head or delegate.
(c) Full text of funding opportunities. The Federal awarding agency
must include the following information in the full text of each funding
opportunity. For specific instructions on the content required in this
section, refer to Appendix I to Part 200.
(1) Full programmatic description of the funding opportunity.
(2) Federal award information, including sufficient information to
help an applicant make an informed decision about whether to submit an
application. (See also Sec. 200.414(c)(4)).
(3) Specific eligibility information, including any factors or
priorities that affect an applicant's or its application's eligibility
for selection.
(4) Application Preparation and Submission Information, including
the applicable submission dates and time.
(5) Application Review Information including the criteria and
process to be used to evaluate applications. See also Sec. Sec.
200.205 and 200.206.
(6) Federal Award Administration Information. See also Sec.
200.211.
Sec. 200.205 Federal awarding agency review of merit of proposals.
For discretionary grants or cooperative agreements, unless
prohibited by Federal statute, the Federal awarding agency must design
and execute a merit review process for applications, with the objective
of selecting the recipients most likely to be successful in delivering
results based on the program objectives outlines in section Sec.
200.202. This process must be described or incorporated by reference in
the applicable funding opportunity (see Appendix I to this part.) See
also Sec. 200.204. The Federal awarding agency must also
systematically review award selection criteria for effectiveness.
Sec. 200.206 Federal awarding agency review of risk posed by
applicants.
(a) Review of OMB-designated repositories of governmentwide data.
(1) Prior to making a Federal award, the Federal awarding agency is
required by the Improper Payments Elimination and Recovery Improvement
Act of 2012, 31 U.S.C. 3321, note and 41 U.S.C. 2313 note to review
information available through any OMB-designated repositories of
governmentwide eligibility qualification or financial integrity
information as appropriate. See also suspension and debarment
requirements at 2 CFR part 180 as well as individual Federal agency
suspension and debarment regulations in title 2 of the Code of Federal
Regulations.
(2) In accordance 41 U.S.C. 2313, the Federal awarding agency is
required to review the non-public segment of the OMB-designated
integrity and performance system accessible through SAM (currently the
Federal Awardee Performance and Integrity Information System (FAPIIS))
prior to making a Federal award where the Federal share is expected to
exceed the simplified acquisition threshold, defined in 41 U.S.C. 134,
over the period of performance. As required by Public Law 112-239
National Defense Authorization Act for Fiscal Year 2013, prior to
making a Federal award, the Federal awarding agency must consider all
of the information available through FAPIIS with regard to the
applicant and any immediate highest level owner, predecessor (i.e., a
non-Federal entity that is replaced by a successor), or subsidiary,
identified for that applicant in FAPIIS, if applicable. At a minimum,
the information in the system for a prior Federal award recipient must
demonstrate a satisfactory record of executing programs or activities
under Federal grants, cooperative agreements, or procurement awards;
and integrity and business ethics. The Federal awarding agency may make
a Federal award to a recipient who does not fully meet these standards,
if it is determined that the information is not relevant to the current
Federal award under consideration or there are specific conditions that
can appropriately mitigate the effects of the non-Federal entity's risk
in accordance with Sec. 200.208 Specific conditions.
(b) Risk evaluation. (1) In addition, for competitive grants or
cooperative agreements, the Federal awarding agency must have in place
a framework for evaluating the risks posed by applicants before they
receive Federal
[[Page 3791]]
awards. This evaluation may incorporate results of the evaluation of
the applicant's eligibility or the quality of its application. If the
Federal awarding agency determines that a Federal award will be made,
special conditions that correspond to the degree of risk assessed may
be applied to the Federal award. Criteria to be evaluated must be
described in the announcement of funding opportunity described in Sec.
200.204 Notices of funding opportunities.
(2) In evaluating risks posed by applicants, the Federal awarding
agency may use a risk-based approach and may consider any items such as
the following:
(i) Financial stability;
(ii) Quality of management systems and ability to meet the
management standards prescribed in this part;
(iii) History of performance. The applicant's record in managing
Federal awards, if it is a prior recipient of Federal awards, including
timeliness of compliance with applicable reporting requirements,
conformance to the terms and conditions of previous Federal awards, and
if applicable, the extent to which any previously awarded amounts will
be expended prior to future awards;
(iv) Reports and findings from audits performed under Subpart F of
this part or the reports and findings of any other available audits;
and
(v) The applicant's ability to effectively implement statutory,
regulatory, or other requirements imposed on non-Federal entities.
(c) Suspension and debarment compliance. The Federal awarding
agency must comply with the guidelines on governmentwide suspension and
debarment in 2 CFR part 180, and must require non-Federal entities to
comply with these provisions. These provisions restrict Federal awards,
subawards and contracts with certain parties that are debarred,
suspended or otherwise excluded from or ineligible for participation in
Federal programs or activities.
Sec. 200.207 Standard application requirements.
(a) Paperwork clearances. The Federal awarding agency may only use
application information collections approved by OMB under the Paperwork
Reduction Act of 1995 and OMB's implementing regulations in 5 CFR part
1320, Controlling Paperwork Burdens on the Public and in alignment with
OMB-approved, governmentwide data elements available from the OMB-
designated standards lead. Consistent with these requirements, OMB will
authorize additional information collections only on a limited basis.
(b) If applicable, the Federal awarding agency may inform
applicants and recipients that they do not need to provide certain
information otherwise required by the relevant information collection.
Sec. 200.208 Specific conditions.
(a) Federal awarding agencies are responsible for ensuring that
specific Federal award conditions are consistent with the program
design reflected in Sec. 200.202 and include clear performance
expectations of recipients as required in Sec. 200.301.
(b) Risk-based specific conditions.
(1) The Federal awarding agency or pass-through entity may impose
more or less restrictive or additional specific Federal award
conditions as needed, in accordance with paragraphs (b)(2) and (3) of
this section, based on an analysis of the following factors:
(i) Based on the criteria set forth in Sec. 200.206;
(ii) The an applicant or recipient's history of compliance with the
general or specific terms and conditions of a Federal award;
(iii) The applicant or recipient's ability to meet expected
performance goals as described in Sec. 200.211; or
(iv) A responsibility determination of an applicant or recipient
(2) Additional Federal award conditions may include items such as
the following:
(i) Requiring payments as reimbursements rather than advance
payments;
(ii) Withholding authority to proceed to the next phase until
receipt of evidence of acceptable performance within a given budget
period;
(iii) Requiring additional, more detailed financial reports;
(iv) Requiring additional project monitoring;
(v) Requiring the non-Federal entity to obtain technical or
management assistance; or
(vi) Establishing additional prior approvals.
(3) If the Federal awarding agency or pass-through entity is
imposing additional requirements, they must notify the applicant or
non-Federal entity as to:
(i) The nature of the additional requirements;
(ii) The reason why the additional requirements are being imposed;
(iii) The nature of the action needed to remove the additional
requirement, if applicable;
(iv) The time allowed for completing the actions if applicable, and
(v) The method for requesting reconsideration of the additional
requirements imposed.
(c) Any additional requirements must be promptly removed once the
conditions that prompted them have been satisfied.
Sec. 200.209 Certifications and representations.
Unless prohibited by the U.S. Constitution, Federal statutes or
regulations, each Federal awarding agency or pass-through entity is
authorized to require the non-Federal entity to submit certifications
and representations required by Federal statutes, or regulations on an
annual basis. Submission may be required more frequently if the non-
Federal entity fails to meet a requirement of a Federal award.
Sec. 200.210 Pre-award costs.
For requirements on costs incurred by the applicant prior to the
start date of the period of performance of the Federal award, see Sec.
200.458.
Sec. 200.211 Information contained in a Federal award.
A Federal award must include the following information:
(a) Federal award performance goals. The Federal awarding agency
must include in the Federal award of the timing and scope of expected
performance by the non-Federal entity as related to the outcomes
intended to be achieved by the program. Where applicable, this should
also include any performance measures or independent sources of data
that may be used to measure progress. In some instances (e.g.,
discretionary research awards), this must be limited to the requirement
to submit technical performance reports (to be evaluated in accordance
with Federal awarding agency policy). Where appropriate, the Federal
award may include specific performance goals, indicators, milestones,
or expected outcomes (such as outputs, or services performed or public
impacts of any of these) with an expected timeline for accomplishment.
Reporting requirements must be clearly articulated such that, where
appropriate, performance during the execution of the Federal award has
a standard against which non-Federal entity performance can be
measured. The Federal awarding agency may include program-specific
requirements, as applicable. These requirements must be aligned, to the
extent permitted by law, with Federal awarding agency strategic goals,
strategic objectives or performance goals that are relevant to the
program. See
[[Page 3792]]
also OMB Circular A-11, Preparation, Submission and Execution of the
Budget Part 6 for definitions of strategic objectives and performance
goals.
(b) General Federal Award Information. The Federal awarding agency
must include the following general Federal award information in each
Federal award:
(1) Recipient name (which must match the name associated with its
unique entity identifier as defined at 2 CFR 25.315);
(2) Recipient's unique entity identifier;
(3) Unique Federal Award Identification Number (FAIN);
(4) Federal Award Date (see Federal award date in Sec. 200.1
Definitions);
(5) Period of Performance Start and End Date;
(6) Budget Period Start and End Date;
(7) Amount of Federal Funds Obligated by this action;
(8) Total Amount of Federal Funds Obligated;
(9) Total Approved Cost Sharing or Matching, where applicable;
(10) Total Amount of the Federal Award including approved Cost
Sharing or Matching;
(11) Budget Approved by the Federal Awarding Agency;
(12) Federal award description, (to comply with statutory
requirements (e.g., FFATA));
(13) Name of Federal awarding agency and contact information for
awarding official,
(14) Assistance listing number and title;
(15) Identification of whether the award is R&D; and
(16) Indirect cost rate for the Federal award (including if the de
minimis rate is charged per Sec. 200.414).
(17) Performance goals, indicators, targets, baseline data, and
data collection plan
(c) General terms and conditions. (1) Federal awarding agencies
must incorporate the following general terms and conditions either in
the Federal award or by reference, as applicable:
(i) Administrative requirements. These are implemented by the
Federal awarding agency as specified in this part.
(ii) National policy requirements. These include statutory,
executive order, other Presidential directive, or regulatory
requirements that apply by specific reference and are not program-
specific. See Sec. 200.300 Statutory and national policy requirements.
(iii) Recipient integrity and performance matters. If the total
Federal share of the Federal award may include more than $500,000 over
the period of performance, the Federal awarding agency must include the
term and condition available in Appendix XII of this part. See also
Sec. 200.113.
(iv) Future budget periods. If it is anticipated that the period of
performance will include multiple budget periods, the Federal awarding
agency must indicate that subsequent budget periods are subject to the
availability of funds, satisfactory performance, and compliance with
the terms and conditions of the Federal award.
(v) Termination provisions. Recipients must be made aware of the
termination provisions in Sec. 200.339, including the applicable
termination provisions in the Federal awarding agency's regulations and
in each Federal award.
(2) The Federal award must include wording to incorporate, by
reference, all terms and conditions of the award. Any reference within
the award to general terms and conditions must be to the website at
which the Federal awarding agency maintains.
(3) If a non-Federal entity requests a copy of the full text of the
general terms and conditions, the Federal awarding agency must provide
it.
(4) Wherever the general terms and conditions are publicly
available, the Federal awarding agency must maintain an archive of
previous versions of the general terms and conditions, with effective
dates, for use by the non-Federal entity, auditors, or others.
(d) Federal awarding agency, program, or federal award specific
terms and conditions. The Federal awarding agency must include with
each Federal award any terms and conditions necessary to communicate
requirements that are in addition to the requirements outlined in the
Federal awarding agency's general terms and conditions as required in
Sec. 200.208. Whenever practicable, these specific terms and
conditions also should be shared on a public website and in notices of
funding opportunities (as outlined in Sec. 200.204) in addition to
being included in a Federal award. See also Sec. 200.207.
(e) Prohibition of Including References to Non-Binding Guidance
Documents. Federal awarding agencies are prohibited from including
references to non-binding guidance in the terms and conditions of
award. As described in Executive Order (E.O.) 13891, references to non-
binding guidance include references to promising practices and other
documents that the inclusion of by reference carries the implicit
threat of enforcement action. These resources may be shared outside of
the terms and conditions for reference purposes.
(f) Federal awarding agency requirements. Any other information
required by the Federal awarding agency.
Sec. 200.212 Public access to Federal award information.
(a) In accordance with statutory requirements for Federal spending
transparency (e.g., FFATA), except as noted in this section, for
applicable Federal awards the Federal awarding agency must announce all
Federal awards publicly and publish the required information on a
publicly available OMB-designated governmentwide website.
(b) All information posted in the designated integrity and
performance system accessible through SAM (currently FAPIIS) on or
after April 15, 2011 will be publicly available after a waiting period
of 14 calendar days, except for:
(1) Past performance reviews required by Federal Government
contractors in accordance with the Federal Acquisition Regulation (FAR)
48 CFR subpart 42.15;
(2) Information that was entered prior to April 15, 2011; or
(3) Information that is withdrawn during the 14-calendar day
waiting period by the Federal Government official.
(c) Nothing in this section may be construed as requiring the
publication of information otherwise exempt under the Freedom of
Information Act (5 U.S.C. 552), or controlled unclassified information
pursuant to Executive Order 13556.
Sec. 200.213 Reporting a determination that a non-Federal entity is
not qualified for a Federal award.
(a) If a Federal awarding agency does not make a Federal award to a
non-Federal entity because the official determines that the non-Federal
entity does not meet either or both of the minimum qualification
standards as described in Sec. 200.206(a)(2), the Federal awarding
agency must report that determination to the designated integrity and
performance system accessible through SAM (currently FAPIIS), only if
all of the following apply:
(1) The only basis for the determination described in paragraph (a)
of this section is the non-Federal entity's prior record of executing
programs or activities under Federal awards or its record of integrity
and business ethics, as described in Sec. 200.206(a)(2) (i.e., the
entity was determined to be qualified based on all factors other than
those two standards), and
[[Page 3793]]
(2) The total Federal share of the Federal award that otherwise
would be made to the non-Federal entity is expected to exceed the
simplified acquisition threshold over the period of performance.
(b) The Federal awarding agency is not required to report a
determination that a non-Federal entity is not qualified for a Federal
award if they make the Federal award to the non-Federal entity and
includes specific award terms and conditions, as described in Sec.
200.208.
(c) If a Federal awarding agency reports a determination that a
non-Federal entity is not qualified for a Federal award, as described
in paragraph (a) of this section, the Federal awarding agency also must
notify the non-Federal entity that--
(1) The determination was made and reported to the designated
integrity and performance system accessible through SAM, and include
with the notification an explanation of the basis for the
determination;
(2) The information will be kept in the system for a period of five
years from the date of the determination, as required by section 872 of
Public Law 110-417, as amended (41 U.S.C. 2313), then archived;
(3) Each Federal awarding agency that considers making a Federal
award to the non-Federal entity during that five year period must
consider that information in judging whether the non-Federal entity is
qualified to receive the Federal award when the total Federal share of
the Federal award is expected to include an amount of Federal funding
in excess of the simplified acquisition threshold over the period of
performance;
(4) The non-Federal entity may go to the awardee integrity and
performance portal accessible through SAM (currently the Contractor
Performance Assessment Reporting System (CPARS)) and comment on any
information the system contains about the non-Federal entity itself;
and
(5) Federal awarding agencies will consider that non-Federal
entity's comments in determining whether the non-Federal entity is
qualified for a future Federal award.
(d) If a Federal awarding agency enters information into the
designated integrity and performance system accessible through SAM
about a determination that a non-Federal entity is not qualified for a
Federal award and subsequently:
(1) Learns that any of that information is erroneous, the Federal
awarding agency must correct the information in the system within three
business days;
(2) Obtains an update to that information that could be helpful to
other Federal awarding agencies, the Federal awarding agency is
strongly encouraged to amend the information in the system to
incorporate the update in a timely way.
(e) Federal awarding agencies must not post any information that
will be made publicly available in the non-public segment of designated
integrity and performance system that is covered by a disclosure
exemption under the Freedom of Information Act. If the recipient
asserts within seven calendar days to the Federal awarding agency that
posted the information that some or all of the information made
publicly available is covered by a disclosure exemption under the
Freedom of Information Act, the Federal awarding agency that posted the
information must remove the posting within seven calendar days of
receiving the assertion. Prior to reposting the releasable information,
the Federal awarding agency must resolve the issue in accordance with
the agency's Freedom of Information Act procedures.
Sec. 200.214 Suspension and debarment.
Non-federal entities are subject to the non-procurement debarment
and suspension regulations implementing Executive Orders 12549 and
12689, 2 CFR part 180. These regulations restrict awards, subawards,
and contracts with certain parties that are debarred, suspended, or
otherwise excluded from or ineligible for participation in Federal
assistance programs or activities.
Sec. 200.215 Never contract with the enemy.
Federal awarding agencies and non-Federal entities are subject to
the regulations implementing Never Contract with the Enemy in 2 CFR
part 183. These regulations affect grants and cooperative agreements
that are expected to exceed $50,000 within the period of performance,
are performed outside the United States, including U.S. territories,
and are in support of a contingency operation in which members of the
Armed Forces are actively engaged in hostilities.
Sec. 200.216 Prohibition on certain telecommunications and video
surveillance services or equipment.
Grant, cooperative agreement, and loan recipients are prohibited
from using government funds to enter into contracts (or extend or renew
contracts) with entities that use covered technology. See section 889
of Public Law 115-232 (National Defense Authorization Act 2019).
0
54. Amend Sec. 200.300 by revising the first sentence of paragraph (a)
to read as follows:
Sec. 200.300 Statutory and national policy requirements.
(a) The Federal awarding agency must manage and administer the
Federal award in a manner so as to ensure that Federal funding is
expended and associated programs are implemented in full accordance
with the U.S. Constitution, Federal Law, statutory, and public policy
requirements: including, but not limited to, those protecting free
speech, religious liberty, public welfare, the environment, and
prohibiting discrimination. * * *
* * * * *
0
55. Revise Sec. 200.301 to read as follows:
Sec. 200.301 Performance measurement.
The Federal awarding agency must measure the recipient's
performance in a way that will help the Federal awarding agencies and
non-Federal entities to achieve program goals and objectives, share
lessons learned, and foster adoption of promising practices. The
Federal awarding agency should provide recipients with clear
performance goals, indicators, and milestones as described in Sec.
200.211. Performance reporting frequency and content should be
established to not only allow the Federal awarding agency to understand
the recipient's progress but also to facilitate identification of
promising practices among recipients and build evidence upon which the
Federal awarding agency's program and performance decisions are made.
This provision is designed to operate in tandem with evidence-related
statutes (e.g.; The Foundations for Evidence-Based Policymaking Act of
2018, which emphasizes collaboration and coordination to advance data
and evidence-building functions in the Federal government) and related
OMB implementation guidance (e.g.; OMB Memorandum M-19-23: Phase 1
implementation of the Foundations for Evidence-Based Policymaking Act
of 2018. Learning Agendas, Personnel, and Planning Guidance). The
Federal awarding agency must also require the recipient to use OMB-
approved common information collections, as applicable, when providing
financial and performance information. As appropriate and in accordance
with above mentioned information collections, the Federal awarding
agency should require the recipient to relate financial data to
performance accomplishments of the Federal award. Also, in accordance
with above mentioned common information collections, and when
applicable, recipients should also provide cost information to
demonstrate cost
[[Page 3794]]
effective practices (e.g., through unit cost data). In some instances
(e.g., discretionary research awards), these requirements may be
limited to the submission of technical performance reports (to be
evaluated in accordance with agency policy). The Federal awarding
agency should also specify any requirements of award recipients'
participation in a Federally-funded evaluation, and any evaluation
activities required to be conducted by the Federal award.
Sec. 200.302 [Amended]
0
56. Amend Sec. 200.302 as follows:
0
a. In paragraph (b)(1) remove the term ``CFDA'' and add, in its place,
``Assistance listing''.
0
b. In paragraph (b)(3) remove the word ``obligations'' and add, in its
place, ``financial obligations''.
0
57. Amend Sec. 200.303 by revising paragraphs (b) and (e) to read as
follows:
Sec. 200.303 Internal controls.
* * * * *
(b) Comply with the U.S. Constitution, Federal statutes,
regulations, and the terms and conditions of the Federal awards.
* * * * *
(e) Take reasonable measures to safeguard protected personally
identifiable information and other information the Federal awarding
agency or pass-through entity designates as sensitive or the non-
Federal entity considers sensitive consistent with applicable Federal,
state, local, and tribal laws regarding privacy and responsibility over
confidentiality.
0
58. Revise Sec. 200.305 to read as follows:
Sec. 200.305 Federal payment.
(a) For states, payments are governed by Treasury-State CMIA
agreements and default procedures codified at 31 CFR part 205 and TFM
4A-2000 Overall Disbursing Rules for All Federal Agencies.
(b) For non-Federal entities other than states, payments methods
must minimize the time elapsing between the transfer of funds from the
United States Treasury or the pass-through entity and the disbursement
by the non-Federal entity whether the payment is made by electronic
funds transfer, or issuance or redemption of checks, warrants, or
payment by other means. See also Sec. 200.302(b)(6). Except as noted
elsewhere in this part, Federal agencies must require recipients to use
only OMB-approved, governmentwide information collection requests to
request payment.
(1) The non-Federal entity must be paid in advance, provided it
maintains or demonstrates the willingness to maintain both written
procedures that minimize the time elapsing between the transfer of
funds and disbursement by the non-Federal entity, and financial
management systems that meet the standards for fund control and
accountability as established in this part. Advance payments to a non-
Federal entity must be limited to the minimum amounts needed and be
timed to be in accordance with the actual, immediate cash requirements
of the non-Federal entity in carrying out the purpose of the approved
program or project. The timing and amount of advance payments must be
as close as is administratively feasible to the actual disbursements by
the non-Federal entity for direct program or project costs and the
proportionate share of any allowable indirect costs. The non-Federal
entity must make timely payment to contractors in accordance with the
contract provisions.
(2) Whenever possible, advance payments must be consolidated to
cover anticipated cash needs for all Federal awards made by the Federal
awarding agency to the recipient.
(i) Advance payment mechanisms include, but are not limited to,
Treasury check and electronic funds transfer and must comply with
applicable guidance in 31 CFR part 208.
(ii) Non-Federal entities must be authorized to submit requests for
advance payments and reimbursements at least monthly when electronic
fund transfers are not used, and as often as they like when electronic
transfers are used, in accordance with the provisions of the Electronic
Fund Transfer Act (15 U.S.C. 1693-1693r).
(3) Reimbursement is the preferred method when the requirements in
this paragraph (b) cannot be met, when the Federal awarding agency sets
a specific condition per Sec. 200.208, or when the non-Federal entity
requests payment by reimbursement. This method may be used on any
Federal award for construction, or if the major portion of the
construction project is accomplished through private market financing
or Federal loans, and the Federal award constitutes a minor portion of
the project. When the reimbursement method is used, the Federal
awarding agency or pass-through entity must make payment within 30
calendar days after receipt of the billing, unless the Federal awarding
agency or pass-through entity reasonably believes the request to be
improper.
(4) If the non-Federal entity cannot meet the criteria for advance
payments and the Federal awarding agency or pass-through entity has
determined that reimbursement is not feasible because the non-Federal
entity lacks sufficient working capital, the Federal awarding agency or
pass-through entity may provide cash on a working capital advance
basis. Under this procedure, the Federal awarding agency or pass-
through entity must advance cash payments to the non-Federal entity to
cover its estimated disbursement needs for an initial period generally
geared to the non-Federal entity's disbursing cycle. Thereafter, the
Federal awarding agency or pass-through entity must reimburse the non-
Federal entity for its actual cash disbursements. Use of the working
capital advance method of payment requires that the pass-through entity
provide timely advance payments to any subrecipients in order to meet
the subrecipient's actual cash disbursements. The working capital
advance method of payment must not be used by the pass-through entity
if the reason for using this method is the unwillingness or inability
of the pass-through entity to provide timely advance payments to the
subrecipient to meet the subrecipient's actual cash disbursements.
(5) Use of resources before requesting cash advance payments. To
the extent available, the non-Federal entity must disburse funds
available from program income (including repayments to a revolving
fund), rebates, refunds, contract settlements, audit recoveries, and
interest earned on such funds before requesting additional cash
payments.
(6) Unless otherwise required by Federal statutes, payments for
allowable costs by non-Federal entities must not be withheld at any
time during the period of performance unless the conditions of Sec.
200.208, subpart D of this part, Sec. 200.338, or one or more of the
following applies:
(i) The non-Federal entity has failed to comply with the project
objectives, Federal statutes, regulations, or the terms and conditions
of the Federal award.
(ii) The non-Federal entity is delinquent in a debt to the United
States as defined in OMB Guidance A-129, ``Policies for Federal Credit
Programs and Non-Tax Receivables.'' Under such conditions, the Federal
awarding agency or pass-through entity may, upon reasonable notice,
inform the non-Federal entity that payments must not be made for
financial obligations incurred after a specified date until the
conditions are corrected or the indebtedness to the Federal Government
is liquidated.
(iii) A payment withheld for failure to comply with Federal award
conditions,
[[Page 3795]]
but without suspension of the Federal award, must be released to the
non-Federal entity upon subsequent compliance. When a Federal award is
suspended, payment adjustments will be made in accordance with Sec.
200.342.
(iv) A payment must not be made to a non-Federal entity for amounts
that are withheld by the non-Federal entity from payment to contractors
to assure satisfactory completion of work. A payment must be made when
the non-Federal entity actually disburses the withheld funds to the
contractors or to escrow accounts established to assure satisfactory
completion of work.
(7) Standards governing the use of banks and other institutions as
depositories of advance payments under Federal awards are as follows.
(i) The Federal awarding agency and pass-through entity must not
require separate depository accounts for funds provided to a non-
Federal entity or establish any eligibility requirements for
depositories for funds provided to the non-Federal entity. However, the
non-Federal entity must be able to account for funds received,
obligated, and expended.
(ii) Advance payments of Federal funds must be deposited and
maintained in insured accounts whenever possible.
(8) The non-Federal entity must maintain advance payments of
Federal awards in interest-bearing accounts, unless the following
apply:
(i) The non-Federal entity receives less than $250,000 in Federal
awards per year.
(ii) The best reasonably available interest-bearing account would
not be expected to earn interest in excess of $500 per year on Federal
cash balances.
(iii) The depository would require an average or minimum balance so
high that it would not be feasible within the expected Federal and non-
Federal cash resources.
(iv) A foreign government or banking system prohibits or precludes
interest bearing accounts.
(9) Interest earned amounts up to $500 per year may be retained by
the non-Federal entity for administrative expense. Any additional
interest earned on Federal advance payments deposited in interest-
bearing accounts must be remitted annually to the Department of Health
and Human Services Payment Management System (PMS) through an
electronic medium using either Automated Clearing House (ACH) network
or a Fedwire Funds Service payment.
(i) For returning interest on Federal awards paid through PMS, the
refund should:
(A) Provide an explanation stating that the refund is for interest;
(B) List the PMS Payee Account Number(s) (PANs);
(C) List the Federal award number(s) for which the interest was
earned; and
(D). Make returns payable to: Department of Health and Human
Services.
(ii) For returning interest on Federal awards not paid through PMS,
the refund should:
(A) Provide an explanation stating that the refund is for interest;
(B) Include the name of the awarding agency;
(C) List the Federal award number(s) for which the interest was
earned; and
(D) Make returns payable to: Department of Health and Human
Services.
(10) Funds, principal, and excess cash returns must be directed to
the original Federal agency payment system. The non-Federal entity
should review instructions from the original Federal agency payment
system. Returns should include the following information:
(i) Payee Account Number (PAN), if the payment originated from PMS,
or Agency information to indicate whom to credit the funding if the
payment originated from ASAP, NSF, or another Federal agency payment
system.
(ii) PMS document number and subaccount(s), if the payment
originated from PMS, or relevant account numbers if the payment
originated from another Federal agency payment system.
(iii) The reason for the return (e.g., excess cash, funds not
spent, interest, part interest part other, etc.)
(11) When returning funds or interest to PMS you must include the
following as applicable:
(i) For ACH Returns:
Routing Number: 051036706.
Account number: 303000.
Bank Name and Location: Credit Gateway--ACH Receiver St. Paul, MN.
(ii) For Fedwire Returns *:
Routing Number: 021030004.
Account number: 75010501.
Bank Name and Location: Federal Reserve Bank Treas NYC/Funds
Transfer Division New York, NY.
(* Please note organization initiating payment is likely to incur a
charge from their Financial Institution for this type of payment)
(iii) For International ACH Returns:
Beneficiary Account: Federal Reserve Bank of New York/ITS (FRBNY/
ITS).
Bank: Citibank N.A. (New York).
Swift Code: CITIUS33.
Account Number: 36838868.
Bank Address: 388 Greenwich Street, New York, NY 10013 USA.
Payment Details (Line 70): Agency Locator Code (ALC): 75010501.
Name (abbreviated when possible) and ALC Agency POC.
(iv) For recipients that do not have electronic remittance
capability, please make check ** payable to: ``The Department of Health
and Human Services.''
Mail Check to Treasury approved lockbox: HHS Program Support
Center, P.O. Box 530231, Atlanta, GA 30353-0231.
(** Please allow 4-6 weeks for processing of a payment by check to be
applied to the appropriate PMS account)
(v) Questions can be directed to PMS at 877-614-5533 or
[email protected].
Sec. 200.306 [Amended]
0
59. In Sec. 200.306 paragraph (a) remove ``200.203'' and add, in its
place, ``200.204''.
0
60. Amend Sec. 200.307 by revising paragraphs (d) and (g) to read as
follows:
Sec. 200.307 Program income.
* * * * *
(d) Property. Proceeds from the sale of real property, equipment,
or supplies are not program income; such proceeds will be handled in
accordance with the requirements of Subpart D of this part, Sec. Sec.
200.310, 200.312, and 200.313, or as specifically identified in Federal
statutes, regulations, or the terms and conditions of the Federal
award.
* * * * *
(g) Unless the Federal statute, regulations, or terms and
conditions for the Federal award provide otherwise, the non-Federal
entity is not accountable to the Federal awarding agency with respect
to program income earned from license fees and royalties for
copyrighted material, patents, patent applications, trademarks, and
inventions made under a Federal award to which 37 CFR part 401 is
applicable.
0
61. Revise Sec. 200.308 to read as follows:
Sec. 200.308 Revision of budget and program plans.
(a) The approved budget for the Federal award summarizes the
financial aspects of the project or program as approved during the
Federal award process. It may include either the Federal and non-
Federal share (see Federal share in Sec. 200.1) or only the Federal
share, depending upon Federal awarding agency requirements. The budget
and program plans must include considerations for performance and
program evaluation purposes whenever required in accordance with the
terms and conditions of the award.
[[Page 3796]]
(b) Recipients are required to report deviations from budget or
project scope or objective, and request prior approvals from Federal
awarding agencies for budget and program plan revisions, in accordance
with this section.
(c) For non-construction Federal awards, recipients must request
prior approvals from Federal awarding agencies for the following
program or budget-related reasons:
(1) Change in the scope or the objective of the project or program
(even if there is no associated budget revision requiring prior written
approval).
(2) Change in a key person specified in the application or the
Federal award.
(3) The disengagement from the project for more than three months,
or a 25 percent reduction in time devoted to the project, by the
approved project director or principal investigator.
(4) The inclusion, unless waived by the Federal awarding agency, of
costs that require prior approval in accordance with Subpart E of this
part or 45 CFR part 75 Appendix IX, or 48 CFR part 31, as applicable.
(5) The transfer of funds budgeted for participant support costs to
other categories of expense.
(6) Unless described in the application and funded in the approved
Federal awards, the subawarding, transferring or contracting out of any
work under a Federal award, including fixed amount subawards as
described in Sec. 200.332 Fixed amount subawards. This provision does
not apply to the acquisition of supplies, material, equipment or
general support services.
(7) Changes in the approved cost-sharing or matching provided by
the non-Federal entity.
(8) The need arises for additional Federal funds to complete the
project.
(d) No other prior approval requirements for specific items may be
imposed unless an exception has been approved by OMB. See also
Sec. Sec. 200.102 and 200.407.
(e) Except for requirements listed in paragraphs (c)(1) through (8)
of this section, the Federal awarding agency is authorized, at its
option, to waive other cost-related and administrative prior written
approvals contained in Subparts D and E. Such waivers may include
authorizing recipients to do any one or more of the following:
(1) Incur project costs 90 calendar days before the Federal
awarding agency makes the Federal award. Expenses more than 90 calendar
days pre-award require prior approval of the Federal awarding agency.
All costs incurred before the Federal awarding agency makes the Federal
award are at the recipient's risk (i.e., the Federal awarding agency is
not required to reimburse such costs if for any reason the recipient
does not receive a Federal award or if the Federal award is less than
anticipated and inadequate to cover such costs). See also Sec. 200.458
Pre-award costs.
(2) Initiate a one-time extension of the period of performance by
up to 12 months unless one or more of the conditions outlined in
paragraphs (d)(2)(i) through (iii) of this section apply. For one-time
extensions, the recipient must notify the Federal awarding agency in
writing with the supporting reasons and revised period of performance
at least 10 calendar days before the end of the period of performance
specified in the Federal award. This one-time extension must not be
exercised merely for the purpose of using unobligated balances.
Extensions require explicit prior Federal awarding agency approval
when:
(i) The terms and conditions of the Federal award prohibit the
extension.
(ii) The extension requires additional Federal funds.
(iii) The extension involves any change in the approved objectives
or scope of the project.
(3) Carry forward unobligated balances to subsequent budget
periods.
(4) For Federal awards that support research, unless the Federal
awarding agency provides otherwise in the Federal award or in the
Federal awarding agency's regulations, the prior approval requirements
described in paragraph (d) are automatically waived (i.e., recipients
need not obtain such prior approvals) unless one of the conditions
included in paragraph (d)(2) applies.
(f) The Federal awarding agency may, at its option, restrict the
transfer of funds among direct cost categories or programs, functions
and activities for Federal awards in which the Federal share of the
project exceeds the Simplified Acquisition Threshold and the cumulative
amount of such transfers exceeds or is expected to exceed 10 percent of
the total budget as last approved by the Federal awarding agency. The
Federal awarding agency cannot permit a transfer that would cause any
Federal appropriation to be used for purposes other than those
consistent with the appropriation.
(g) All other changes to non-construction budgets, except for the
changes described in paragraph (c) of this section, do not require
prior approval (see also Sec. 200.407).
(h) For construction Federal awards, the recipient must request
prior written approval promptly from the Federal awarding agency for
budget revisions whenever paragraph (h)(1), (2), or (3) of this section
applies:
(1) The revision results from changes in the scope or the objective
of the project or program.
(2) The need arises for additional Federal funds to complete the
project.
(3) A revision is desired which involves specific costs for which
prior written approval requirements may be imposed consistent with
applicable OMB cost principles listed in Subpart E of this part.
(4) No other prior approval requirements for budget revisions may
be imposed unless an exception has been approved by OMB.
(5) When a Federal awarding agency makes a Federal award that
provides support for construction and non-construction work, the
Federal awarding agency may require the recipient to obtain prior
approval from the Federal awarding agency before making any fund or
budget transfers between the two types of work supported.
(i) When requesting approval for budget revisions, the recipient
must use the same format for budget information that was used in the
application, unless the Federal awarding agency indicates a letter of
request suffices.
(j) Within 30 calendar days from the date of receipt of the request
for budget revisions, the Federal awarding agency must review the
request and notify the recipient whether the budget revisions have been
approved. If the revision is still under consideration at the end of 30
calendar days, the Federal awarding agency must inform the recipient in
writing of the date when the recipient may expect the decision.
Sec. 200.309 [Removed]
0
62. Remove Sec. 200.309.
Sec. Sec. 200.310 through 200.321 [Redesignated]
0
63. Redesignate Sec. Sec. 200.310 through 200.321 to Sec. Sec.
200.309 through 200.320.
0
64. Amend newly redesignated Sec. 200.310 to revise paragraph (a) to
read as follows:
Sec. 200.310 Real property.
(a) Title. Subject to the requirements and conditions set forth in
this section, title to real property acquired or improved under a
Federal award will vest upon acquisition in the non-Federal entity.
* * * * *
0
65. Amend newly redesignated Sec. 200.311 by revising the first
sentence of paragraph (c) to read as follows:
Sec. 200.311 Federally-owned and exempt property.
* * * * *
[[Page 3797]]
(c) Exempt federally-owned property means property acquired under a
Federal award where the Federal awarding agency has chosen to vest
title to the property to the non-Federal entity without further
responsibility to the Federal Government, based upon the explicit terms
and conditions of the Federal award. * * *
0
66. Amend newly redesignated Sec. 200.312 by revising paragraph (a),
paragraph (c) introductory, paragraph (e)(1) and the first sentence of
(e)(2) to read as follows:
Sec. 200.312 Equipment.
* * * * *
(a) Title. Subject to the requirements and conditions set forth in
this section, title to equipment acquired under a Federal award will
vest upon acquisition in the non-Federal entity. Unless a statute
specifically authorizes the Federal agency to vest title in the non-
Federal entity without further responsibility to the Federal
Government, and the Federal agency elects to do so, the title must be a
conditional title. Title must vest in the non-Federal entity subject to
the following conditions:
* * * * *
(c) * * * (1) Equipment must be used by the non-Federal entity in
the program or project for which it was acquired as long as needed,
whether or not the project or program continues to be supported by the
Federal award, and the non-Federal entity must not encumber the
property without prior approval of the Federal awarding agency. The
Federal awarding agency may require the submission of the applicable
common form for equipment. When no longer needed for the original
program or project, the equipment may be used in other activities
supported by the Federal awarding agency, in the following order of
priority:
* * * * *
(e) * * *
(1) Items of equipment with a current per unit fair market value of
$5,000 or less may be retained, sold or otherwise disposed of with no
further responsibility to the Federal awarding agency.
(2) Except as provided in Sec. 200.311 Federally-owned and exempt
property, paragraph (b), or if the Federal awarding agency fails to
provide requested disposition instructions within 120 days, items of
equipment with a current per-unit fair-market value in excess of $5,000
may be retained by the non-Federal entity or sold. * * *
* * * * *
0
67. Amend newly redesignated Sec. 200.313 by revising the last
sentence of paragraph (a) to read as follows:
Sec. 200.313 Supplies.
* * * * *
(a) * * * See Sec. 200.312(e)(2) for the calculation methodology.
0
68. Amend the newly redesignated Sec. 200.314 by revising paragraph
(a) to read as follows:
Sec. 200.314 Intangible property.
(a) Title to intangible property (see Intangible property in Sec.
200.1) acquired under a Federal award vests upon acquisition in the
non-Federal entity. The non-Federal entity must use that property for
the originally-authorized purpose, and must not encumber the property
without approval of the Federal awarding agency. When no longer needed
for the originally authorized purpose, disposition of the intangible
property must occur in accordance with the provisions in Sec.
200.312(e).
* * * * *
0
69. Amend the newly redesignated Sec. 200.316 by revising the last
sentence to read as follows:
Sec. 200.316 Procurements by states.
* * * All other non-Federal entities, including subrecipients of a
state, will follow Sec. Sec. 200.317 through 200.326.
0
70. Amend the newly redesignated Sec. 200.317 by revising the last
sentence of paragraph (h) to read as follows:
Sec. 200.317 General procurement standards.
* * * * *
(h) * * * See also Sec. 200.213.
0
71. Revise the newly redesignated Sec. 200.318 to read as follows:
Sec. 200.318 Competition.
(a) All procurement transactions for the acquisition of property or
services required under a Federal award must be conducted in a manner
providing full and open competition consistent with the standards of
this section and Sec. 200.319, Methods of procurement to be followed.
(b) In order to ensure objective contractor performance and
eliminate unfair competitive advantage, contractors that develop or
draft specifications, requirements, statements of work, or invitations
for bids or requests for proposals must be excluded from competing for
such procurements. Some of the situations considered to be restrictive
of competition include but are not limited to:
(1) Placing unreasonable requirements on firms in order for them to
qualify to do business;
(2) Requiring unnecessary experience and excessive bonding;
(3) Noncompetitive pricing practices between firms or between
affiliated companies;
(4) Noncompetitive contracts to consultants that are on retainer
contracts;
(5) Organizational conflicts of interest;
(6) Specifying only a ``brand name'' product instead of allowing
``an equal'' product to be offered and describing the performance or
other relevant requirements of the procurement; and
(7) Any arbitrary action in the procurement process.
(c) The non-Federal entity must conduct procurements in a manner
that prohibits the use of statutorily or administratively imposed
state, local, or tribal geographical preferences in the evaluation of
bids or proposals, except in those cases where applicable Federal
statutes expressly mandate or encourage geographic preference. Nothing
in this section preempts state licensing laws. When contracting for
architectural and engineering (A/E) services, geographic location may
be a selection criterion provided its application leaves an appropriate
number of qualified firms, given the nature and size of the project, to
compete for the contract.
(d) The non-Federal entity must have written procedures for
procurement transactions. These procedures must ensure that all
solicitations:
(1) Incorporate a clear and accurate description of the technical
requirements for the material, product, or service to be procured. Such
description must not, in competitive procurements, contain features
which unduly restrict competition. The description may include a
statement of the qualitative nature of the material, product or service
to be procured and, when necessary, must set forth those minimum
essential characteristics and standards to which it must conform if it
is to satisfy its intended use. Detailed product specifications should
be avoided if at all possible. When it is impractical or uneconomical
to make a clear and accurate description of the technical requirements,
a ``brand name or equivalent'' description may be used as a means to
define the performance or other salient requirements of procurement.
The specific features of the named brand which must be met by offers
must be clearly stated; and
(2) Identify all requirements which the offerors must fulfill and
all other factors to be used in evaluating bids or proposals.
(e) The non-Federal entity must ensure that all prequalified lists
of persons, firms, or products which are
[[Page 3798]]
used in acquiring goods and services are current and include enough
qualified sources to ensure maximum open and free competition. Also,
the non-Federal entity must not preclude potential bidders from
qualifying during the solicitation period.
(f) Noncompetitive procurements can only be awarded in accordance
with Sec. 200.319(b)(3).
0
72. Revise the newly redesignated Sec. 200.319 to read as follows:
Sec. 200.319 Methods of procurement to be followed.
The non-Federal entity must have and use documented procurement
procedures for the following methods of procurement for the acquisition
of property or services required under a Federal award.
(a) Informal procurement methods. When the value of the procurement
for property or services under a Federal award does not exceed the
simplified acquisition threshold, as defined in Sec. 200.1
Definitions, formal procurement methods are not required. The non-
Federal entity may use informal procurement methods to expedite the
completion of its transactions and minimize the associated
administrative burden and cost. The following informal methods of
procurement used for procurement of property or services at or below
the simplified acquisition threshold include:
(1) Micro-purchases. (i) The acquisition of property or services,
the aggregate dollar amount of which does not exceed the micro-purchase
threshold (See Micro-purchase in Sec. 200.1 Definitions). To the
maximum extent practicable, the non-Federal entity should distribute
micro-purchases equitably among qualified suppliers.
(ii) Micro-purchases may be awarded without soliciting competitive
price or rate quotations if the non-Federal entity considers the price
to be reasonable and can include the use of purchase cards if
documented and approved by the non-Federal entity.
(iii) Micro-purchase thresholds that differ from the FAR. The non-
Federal entity is responsible for determining an appropriate micro-
purchase threshold based on internal controls, an evaluation of risk
and its documented procurement procedures. All non-Federal entities can
establish lower thresholds. However, a non-Federal entity may request a
higher micro-purchase threshold in accordance to section (iv) below.
When applicable, the micro-purchase threshold used by the non-Federal
entity must be authorized or not prohibited under State, local, or
tribal laws or regulations.
Requests for approval of a higher threshold must be submitted to
the cognizant Federal agency for indirect cost rates (see Cognizant
agency for indirect costs) for review and approval.
(iv) Cognizant agency for indirect cost evaluation of higher
threshold requests are performed to determine if an entity is low risk
(see Sec. 200.520 Criteria for a low-risk auditee) and must include at
a minimum a review of the entity's audit findings and any appropriate
internal institutional risk assessments. Values used to set micro-
purchase thresholds must also be consistent with any applicable state
laws.
(2) Small purchases. (i) The acquisition of property or services,
the aggregate dollar amount of which is higher than the micro-purchase
threshold but does not exceed the simplified acquisition threshold. If
small purchase procedures are used, price or rate quotations must be
obtained from an adequate number of qualified sources.
(ii) Simplified acquisition thresholds that differ from the FAR.
The non-Federal entity is responsible for determining an appropriate
simplified acquisition threshold based on internal controls, an
evaluation of risk and its documented procurement procedures which must
not exceed the threshold established in the FAR. When applicable, the
simplified acquisition threshold used by the non-Federal entity must be
authorized or not prohibited under State, local, or tribal laws or
regulations.
(b) Formal procurement methods. When the value of the procurement
for property or services under a Federal financial assistance award
exceeds the simplified acquisition threshold (SAT) (Simplified
acquisition threshold), or a threshold established by a non-federal
entity, formal procurement methods are required. Formal procurement
methods require following documented procedures. Formal procurement
methods also require public advertising unless a non-competitive
procurement can be used in accordance with Sec. 200.318 Competition.
The following formal methods of procurement are used for procurement of
property or services above the simplified acquisition threshold or a
value below the simplified acquisition threshold the non-Federal entity
determines to be appropriate:
(1) Sealed bids. A procurement method in which bids are publicly
solicited and a firm fixed price contract (lump sum or unit price) is
awarded to the responsible bidder whose bid, conforming with all the
material terms and conditions of the invitation for bids, is the lowest
in price. The sealed bids method is the preferred method for procuring
construction, if the conditions in paragraph (c)(1) of this section
apply.
(i) In order for sealed bidding to be feasible, the following
conditions should be present:
(A) A complete, adequate, and realistic specification or purchase
description is available;
(B) Two or more responsible bidders are willing and able to compete
effectively for the business; and
(C) The procurement lends itself to a firm fixed price contract and
the selection of the successful bidder can be made principally on the
basis of price.
(ii) If sealed bids are used, the following requirements apply:
(A) Bids must be solicited from an adequate number of known
suppliers, providing them sufficient response time prior to the date
set for opening the bids, for local, and tribal governments, the
invitation for bids must be publicly advertised;
(B) The invitation for bids, which will include any specifications
and pertinent attachments, must define the items or services in order
for the bidder to properly respond;
(C) All bids will be opened at the time and place prescribed in the
invitation for bids, and for local and tribal governments, the bids
must be opened publicly;
(D) A firm fixed price contract award will be made in writing to
the lowest responsive and responsible bidder. Where specified in
bidding documents, factors such as discounts, transportation cost, and
life cycle costs must be considered in determining which bid is lowest.
Payment discounts will only be used to determine the low bid when prior
experience indicates that such discounts are usually taken advantage
of; and
(E) Any or all bids may be rejected if there is a sound documented
reason.
(2) Proposals. A procurement method in which either a fixed price
or cost-reimbursement type contract is awarded. Proposals are generally
used when conditions are not appropriate for the use of sealed bids.
They are awarded in accordance with the following requirements:
(i) Requests for proposals must be publicized and identify all
evaluation factors and their relative importance. Proposals must be
solicited from an adequate number of qualified offerors. Any response
to publicized requests for proposals must be considered to the maximum
extent practical;
[[Page 3799]]
(ii) The non-Federal entity must have a written method for
conducting technical evaluations of the proposals received and making
selections;
(iii) Contracts must be awarded to the responsible offeror whose
proposal is most advantageous to the non-Federal entity, with price and
other factors considered; and
(iv) The non-Federal entity may use competitive proposal procedures
for qualifications-based procurement of architectural/engineering (A/E)
professional services whereby offeror's qualifications are evaluated
and the most qualified offeror is selected, subject to negotiation of
fair and reasonable compensation. The method, where price is not used
as a selection factor, can only be used in procurement of A/E
professional services. It cannot be used to purchase other types of
services though A/E firms that are a potential source to perform the
proposed effort.
(3) Noncompetitive procurement. There are specific circumstances in
which noncompetitive procurement can be used. Noncompetitive
procurement can only be awarded if one or more of the following
circumstances apply:
(i) The acquisition of property or services, the aggregate dollar
amount of which does not exceed the micro-purchase threshold (see Sec.
200.319(a)(1));
(ii) The item is available only from a single source;
(iii) The public exigency or emergency for the requirement will not
permit a delay resulting from competitive solicitation;
(iv) The Federal awarding agency or pass-through entity expressly
authorizes a noncompetitive procurement in response to a written
request from the non-Federal entity; or
(v) After solicitation of a number of sources, competition is
determined inadequate.
0
73. Add Sec. 200.321 to read as follows:
Sec. 200.321 Domestic preferences for procurements.
(a) As appropriate and to the extent consistent with law, the non-
Federal entity should, to the greatest extent practicable under a
Federal award, provide a preference for the purchase, acquisition, or
use of goods, products, or materials produced in the United States
(including but not limited to iron, aluminum, steel, cement, and other
manufactured products). This term must be included in all subawards
including all contracts and purchase orders for work or products under
this award.
(b) For purposes of this award term:
(1) ``Produced in the United States'' means, for iron and steel
products, that all manufacturing processes, from the initial melting
stage through the application of coatings, occurred in the United
States.
(2) ``Manufactured products'' means items and construction
materials composed in whole or in part of non-ferrous metals such as
aluminum; plastics and polymer-based products such as polyvinyl
chloride pipe; aggregates such as concrete; glass, including optical
fiber; and lumber.
0
74. Amend Sec. 200.325 by revising paragraph (b) to read as follows:
Sec. 200.325 Bonding requirements.
* * * * *
(b) A performance bond on the part of the contractor for 100
percent of the contract price. A ``performance bond'' is one executed
in connection with a contract to secure fulfillment of all the
contractor's requirements under such contract.
* * * * *
0
75. Amend Sec. 200.327 by revising the first sentence to read as
follows:
Sec. 200.327 Financial reporting.
Unless otherwise approved by OMB, the Federal awarding agency must
solicit only the OMB-approved governmentwide data elements for
collection of financial information (at time of publication the Federal
Financial Report or such future, OMB-approved, governmentwide data
elements available from the OMB-designated standards lead. * * *
0
76. Amend Sec. 200.328 by revising paragraph (b) introductory text,
paragraph (b)(1), and paragraph (b)(2) introductory text to read as
follows:
Sec. 200.328 Monitoring and reporting program performance.
* * * * *
(b) Non-construction performance reports. The Federal awarding
agency must use standard, OMB-approved data elements for collection of
performance information (including performance progress reports,
Research Performance Progress Report, or such future OMB-approved,
governmentwide data elements available from the OMB-designated
standards lead.
(1) The non-Federal entity must submit performance reports at the
interval required by the Federal awarding agency or pass-through entity
to best inform improvements in program outcomes and productivity.
Intervals must be no less frequent than annually nor more frequent than
quarterly except in unusual circumstances, for example where more
frequent reporting is necessary for the effective monitoring of the
Federal award or could significantly affect program outcomes. Annual
reports must be due 120 calendar days after the reporting period;
quarterly or semiannual reports must be due 30 calendar days after the
reporting period. Alternatively, the Federal awarding agency or pass-
through entity may require annual reports before the anniversary dates
of multiple year Federal awards. The final performance report will be
due 120 calendar days after the period of performance end date. If a
justified request is submitted by a non-Federal entity, the Federal
agency may extend the due date for any performance report.
(2) The non-Federal entity must submit performance reports using
OMB-approved governmentwide common information collections when
providing performance information. As applicable, these information
collections must use OMB-approved, governmentwide data elements
available from the OMB-designated standards lead. As appropriate in
accordance with above mentioned information collections, these reports
will contain, for each Federal award, brief information on the
following unless other collections are approved by OMB:
* * * * *
0
77. Amend Sec. 200.330 by revising paragraphs (a) introductory text
and (b) introductory text to read as follows:
Sec. 200.330 Subrecipient and contractor determinations.
* * * * *
(a) Subrecipients. A subaward is for the purpose of carrying out a
portion of a Federal award and creates a Federal assistance
relationship with the subrecipient. See Subaward in Sec. 200.1.
Characteristics which support the classification of the non-Federal
entity as a subrecipient include when the non-Federal entity:
* * * * *
(b) Contractors. A contract is for the purpose of obtaining goods
and services for the non-Federal entity's own use and creates a
procurement relationship with the contractor. See Contract in Sec.
200.1. Characteristics indicative of a procurement relationship between
the non-Federal entity and a contractor are when the contractor:
* * * * *
0
78. Revise Sec. 200.331 to read as follows:
Sec. 200.331 Requirements for pass-through entities.
All pass-through entities must:
(a) Ensure that every subaward is clearly identified to the
subrecipient as a subaward and includes the following information at
the time of the subaward
[[Page 3800]]
and if any of these data elements change, include the changes in
subsequent subaward modification. When some of this information is not
available, the pass-through entity must provide the best information
available to describe the Federal award and subaward. Required
information includes:
(1) Federal award identification:
(i) Subrecipient name (which must match the name associated with
its unique entity identifier);
(ii) Subrecipient's unique entity identifier;
(iii) Federal Award Identification Number (FAIN);
(iv) Federal Award Date (see Federal award date in Sec. 200.1) of
award to the recipient by the Federal agency;
(v) Subaward Period of Performance Start and End Date;
(vi) Subaward Budget Period Start and End Date;
(vii) Amount of Federal Funds Obligated by this action by the pass-
through entity to the subrecipient;
(viii) Total Amount of Federal Funds Obligated to the subrecipient
by the pass-through entity including the current financial obligation;
(ix) Total Amount of the Federal Award committed to the
subrecipient by the pass-through entity;
(x) Federal award project description, as required to be responsive
to the Federal Funding Accountability and Transparency Act (FFATA);
(xi) Name of Federal awarding agency, pass-through entity, and
contact information for awarding official of the Pass-through entity;
(xii) Assistance listing number and title; the pass-through entity
must identify the dollar amount made available under each Federal award
and the Assistance listing number at time of disbursement;
(xiii) Identification of whether the award is R&D; and
(xiv) Indirect cost rate for the Federal award (including if the de
minimis rate is charged per Sec. 200.414).
(2) All requirements imposed by the pass-through entity on the
subrecipient so that the Federal award is used in accordance with
Federal statutes, regulations and the terms and conditions of the
Federal award;
(3) Any additional requirements that the pass-through entity
imposes on the subrecipient in order for the pass-through entity to
meet its own responsibility to the Federal awarding agency including
identification of any required financial and performance reports;
(4) An approved federally recognized indirect cost rate negotiated
between the subrecipient and the Federal Government. The pass-through
entity must not require use of a de minimus indirect cost rate if the
subrecipient has a federally approved rate. If no federally approved
rate exists, the pass-through entity must accept:
(i) The negotiated indirect cost rate between the pass-through
entity and the subrecipient;
(ii) The negotiated indirect cost rate between a different pass-
through entity and the subrecipient; or
(iii) The de minimus indirect cost rate;
(5) A requirement that the subrecipient permit the pass-through
entity and auditors to have access to the subrecipient's records and
financial statements as necessary for the pass-through entity to meet
the requirements of this part; and
(6) Appropriate terms and conditions concerning closeout of the
subaward.
(b) Evaluate each subrecipient's risk of noncompliance with Federal
statutes, regulations, and the terms and conditions of the subaward for
purposes of determining the appropriate subrecipient monitoring
described in paragraphs (d) and (e) of this section, which may include
consideration of such factors as:
(1) The subrecipient's prior experience with the same or similar
subawards;
(2) The results of previous audits including whether or not the
subrecipient receives a Single Audit in accordance with Subpart F--
Audit Requirements of this part, and the extent to which the same or
similar subaward has been audited as a major program;
(3) Whether the subrecipient has new personnel or new or
substantially changed systems; and
(4) The extent and results of Federal awarding agency monitoring
(e.g., if the subrecipient also receives Federal awards directly from a
Federal awarding agency).
(c) Consider imposing specific subaward conditions upon a
subrecipient if appropriate as described in Sec. 200.208.
(d) Monitor the activities of the subrecipient as necessary to
ensure that the subaward is used for authorized purposes, in compliance
with Federal statutes, regulations, and the terms and conditions of the
subaward; and that subaward performance goals are achieved. Pass-
through entity monitoring of the subrecipient must include:
(1) Reviewing financial and performance reports required by the
pass-through entity.
(2) Following-up and ensuring that the subrecipient takes timely
and appropriate action on all deficiencies pertaining to the Federal
award provided to the subrecipient from the pass-through entity
detected through audits, on-site reviews, and other means. Other means
may include written confirmation from the subrecipient related to the
Single Audit already performed and any audit findings related to the
particular subaward.
(3) Issuing a management decision for applicable audit findings
pertaining only to the Federal award provided to the subrecipient from
the pass-through entity as required by Sec. 200.521.
(4) The pass-through entity is only responsible for resolving audit
findings specifically related to the subaward (i.e., non-systemic) and
not applicable to the entire subrecipient (i.e., systemic). If a
subrecipient has a current Single Audit report posted in the Federal
Audit Clearinghouse and has not otherwise been excluded from receipt of
Federal funding (e.g., has been debarred or suspended), the pass-
through entity may rely on the subrecipient's auditors and cognizant
agency for routine audit follow-up and management decisions. Such
reliance does not eliminate the responsibility of the pass-through
entity to issue subawards that conform to agency and award-specific
requirements, to manage risk through ongoing subaward monitoring, and
to monitor the status of the findings that are specifically related to
the subaward issued by the pass-through entity.
(e) Depending upon the pass-through entity's assessment of risk
posed by the subrecipient (as described in paragraph (b) of this
section), the following monitoring tools may be useful for the pass-
through entity to ensure proper accountability and compliance with
program requirements and achievement of performance goals:
(1) Providing subrecipients with training and technical assistance
on program-related matters; and
(2) Performing on-site reviews of the subrecipient's program
operations;
(3) Arranging for agreed-upon-procedures engagements as described
in Sec. 200.425 Audit services.
(f) Verify that every subrecipient is audited as required by
Subpart F of this part when it is expected that the subrecipient's
Federal awards expended during the respective fiscal year equaled or
exceeded the threshold set forth in Sec. 200.501.
(g) Consider whether the results of the subrecipient's audits, on-
site reviews, or other monitoring indicate conditions
[[Page 3801]]
that necessitate adjustments to the pass-through entity's own records.
(h) Consider taking enforcement action against noncompliant
subrecipients as described in Sec. 200.338 Remedies for noncompliance
of this part and in program regulations.
0
79. Revise Sec. 200.335 to read as follows.
Sec. 200.335 Methods for collection, transmission and storage of
information.
The Federal awarding agency and the non-Federal entity should,
whenever practicable, collect, transmit, and store Federal award-
related information in open and machine-readable formats rather than in
closed formats or on paper in accordance with applicable legislative
requirements. A machine-readable format is a format in a standard
computer language (not English text) that can be read automatically by
a web browser or computer system. The Federal awarding agency or pass-
through entity must always provide or accept paper versions of Federal
award-related information to and from the non-Federal entity upon
request. If paper copies are submitted, the Federal awarding agency or
pass-through entity must not require more than an original and two
copies. When original records are electronic and cannot be altered,
there is no need to create and retain paper copies. When original
records are paper, electronic versions may be substituted through the
use of duplication or other forms of electronic media provided that
they are subject to periodic quality control reviews, provide
reasonable safeguards against alteration, and remain readable.
Sec. 200.337 [Amended]
0
80. Amend Sec. 200.337 by removing ``Sec. 200.315 Intangible
property'' and adding, in its place, ``Sec. 200.314''.
0
81. Amend Sec. 200.338 by revising the introductory text to read as
follows:
Sec. 200.338 Remedies for noncompliance.
If a non-Federal entity fails to comply with the U.S. Constitution,
Federal statutes, regulations or the terms and conditions of a Federal
award, the Federal awarding agency or pass-through entity may impose
additional conditions, as described in Sec. 200.208 Specific
conditions. If the Federal awarding agency or pass-through entity
determines that noncompliance cannot be remedied by imposing additional
conditions, the Federal awarding agency or pass-through entity may take
one or more of the following actions, as appropriate in the
circumstances:
* * * * *
0
82. Revise Sec. 200.339 to read as follows:
Sec. 200.339 Termination.
(a) The Federal award may be terminated in whole or in part as
follows:
(1) By the Federal awarding agency or pass-through entity, if a
non-Federal entity fails to comply with the terms and conditions of a
Federal award;
(2) By the Federal awarding agency or pass-through entity, to the
greatest extent authorized by law, if an award no longer effectuates
the program goals or agency priorities;
(3) By the Federal awarding agency or pass-through entity with the
consent of the non-Federal entity, in which case the two parties must
agree upon the termination conditions, including the effective date
and, in the case of partial termination, the portion to be terminated;
(4) By the non-Federal entity upon sending to the Federal awarding
agency or pass-through entity written notification setting forth the
reasons for such termination, the effective date, and, in the case of
partial termination, the portion to be terminated. However, if the
Federal awarding agency or pass-through entity determines in the case
of partial termination that the reduced or modified portion of the
Federal award or subaward will not accomplish the purposes for which
the Federal award was made, the Federal awarding agency or pass-through
entity may terminate the Federal award in its entirety; or
(5) By the Federal awarding agency or pass-through entity pursuant
to termination provisions included in the Federal award.
(b) A Federal awarding agency must specify applicable termination
provisions in its regulations and in each Federal award, consistent
with this section.
(c) When a Federal awarding agency terminates a Federal award prior
to the end of the period of performance due to the non-Federal entity's
material failure to comply with the Federal award terms and conditions,
the Federal awarding agency must report the termination to the OMB-
designated integrity and performance system accessible through SAM
(currently FAPIIS).
(1) The information required under paragraph (b) of this section is
not to be reported to designated integrity and performance system until
the non-Federal entity either--
(i) Has exhausted its opportunities to object or challenge the
decision, see Sec. 200.341 Opportunities to object, hearings and
appeals; or
(ii) Has not, within 30 calendar days after being notified of the
termination, informed the Federal awarding agency that it intends to
appeal the Federal awarding agency's decision to terminate.
(2) If a Federal awarding agency, after entering information into
the designated integrity and performance system about a termination,
subsequently:
(i) Learns that any of that information is erroneous, the Federal
awarding agency must correct the information in the system within three
business days;
(ii) Obtains an update to that information that could be helpful to
other Federal awarding agencies, the Federal awarding agency is
strongly encouraged to amend the information in the system to
incorporate the update in a timely way.
(3) Federal awarding agencies, must not post any information that
will be made publicly available in the non-public segment of designated
integrity and performance system that is covered by a disclosure
exemption under the Freedom of Information Act. If the non-Federal
entity asserts within seven calendar days to the Federal awarding
agency who posted the information, that some of the information made
publicly available is covered by a disclosure exemption under the
Freedom of Information Act, the Federal awarding agency who posted the
information must remove the posting within seven calendar days of
receiving the assertion. Prior to reposting the releasable information,
the Federal agency must resolve the issue in accordance with the
agency's Freedom of Information Act procedures.
(d) When a Federal award is terminated or partially terminated,
both the Federal awarding agency or pass-through entity and the non-
Federal entity remain responsible for compliance with the requirements
in Sec. Sec. 200.343 and 200.344.
0
83. Revise Sec. 200.340 paragraph (b) introductory text to read as
follows:
Sec. 200.340 Notification of termination requirement.
* * * * *
(b) If the Federal award is terminated for the non-Federal entity's
material failure to comply with the U.S. Constitution, Federal
statutes, regulations, or terms and conditions of the Federal award,
the notification must state that--
* * * * *
Sec. 200.342 [Amended]
0
84. Amend Sec. 200.342 by removing the term ``obligations'' wherever
it appears
[[Page 3802]]
and adding, in its place ``financial obligations''.
0
85. Revise Sec. 200.343 to read as follows:
Sec. 200.343 Closeout.
The Federal awarding agency or pass-through entity will close-out
the Federal award when it determines that all applicable administrative
actions and all required work of the Federal award have been completed
by the non-Federal entity. If the non-Federal entity fails to complete
the requirements, the Federal awarding agency or pass-through entity
will proceed to close-out the Federal award with the information
available. This section specifies the actions the non-Federal entity
and Federal awarding agency or pass-through entity must take to
complete this process at the end of the period of performance.
(a) The non-Federal entity must submit, no later than 120 calendar
days after the end date of the period of performance, all financial,
performance, and other reports as required by the terms and conditions
of the Federal award. A subrecipient must submit to the pass-through
entity, no later than 90 calendar days after the end date of the period
of performance, all financial, performance, and other reports as
required by the terms and conditions of the Federal award. The Federal
awarding agency or pass-through entity may approve extensions when
requested and justified by the non-Federal entity, as applicable.
(b) Unless the Federal awarding agency or pass-through entity
authorizes an extension, a non-Federal entity must liquidate all
financial obligations incurred under the Federal award no later than
120 calendar days after the end date of the period of performance as
specified in the terms and conditions of the Federal award.
(c) The Federal awarding agency or pass-through entity must make
prompt payments to the non-Federal entity for costs meeting the
requirements in Subpart E of this part under the Federal award being
closed out.
(d) The non-Federal entity must promptly refund any balances of
unobligated cash that the Federal awarding agency or pass-through
entity paid in advance or paid and that are not authorized to be
retained by the non-Federal entity for use in other projects. See OMB
Circular A-129 and see Sec. 200.345, for requirements regarding
unreturned amounts that become delinquent debts.
(e) Consistent with the terms and conditions of the Federal award,
the Federal awarding agency or pass-through entity must make a
settlement for any upward or downward adjustments to the Federal share
of costs after closeout reports are received.
(f) The non-Federal entity must account for any real and personal
property acquired with Federal funds or received from the Federal
Government in accordance with Sec. Sec. 200.309 through 200.315 and
200.329.
(g) When a recipient or subrecipient completes all closeout
requirement, the Federal awarding agency or pass-through entity must
promptly complete all closeout actions for Federal awards. The Federal
awarding agency must make every effort to complete closeout actions no
later than one year after the end of the period of performance unless
otherwise directed by authorizing statutes. Closeout actions include
Federal awarding agency actions in the grants management and payment
systems.
(h) If the non-Federal entity does not submit all reports in
accordance with this section, and the terms and conditions of the
Federal Award, the Federal awarding agency must proceed to closeout
with the information available, within one year of the period of
performance end date.The Federal awarding agency must report the non-
Federal entity's failure to submit required reports to the OMB-
designated integrity and performance system (currently FAPIIS) as the
non-Federal entity's material failure to comply with the terms and
conditions of the award. Federal awarding agencies may also pursue
other enforcement actions per Sec. 200.338.
0
86. Revise Sec. 200.344 to read as follows:
Sec. 200.344 Post-closeout adjustments and continuing
responsibilities.
(a) The closeout of a Federal award does not affect any of the
following:
(1) The right of the Federal awarding agency or pass-through entity
to disallow costs and recover funds on the basis of a later audit or
other review. The Federal awarding agency or pass-through entity must
make any cost disallowance determination and notify the non-Federal
entity within the record retention period.
(2) The requirement for the non-Federal entity to return any funds
due as a result of later refunds, corrections, or other transactions
including final indirect cost rate adjustments.
(3) The ability of the Federal awarding agency to make financial
adjustments to a previously closed award.
(4) Audit requirements in Subpart F of this part.
(5) Property management and disposition requirements in Subpart D
of this part, Sec. Sec. 200.309 through 200.315.
(6) Records retention as required in Subpart D, Sec. Sec. 200.333
through 200.337.
(b) After closeout of the Federal award, a relationship created
under the Federal award may be modified or ended in whole or in part
with the consent of the Federal awarding agency or pass-through entity
and the non-Federal entity, provided the responsibilities of the non-
Federal entity referred to in paragraph (a) of this section, including
those for property management as applicable, are considered and
provisions made for continuing responsibilities of the non-Federal
entity, as appropriate.
0
87. Amend Sec. 200.400 by revising the last sentence of paragraph (e)
to read as follows:
Sec. 200.400 Policy guide.
* * * * *
(e) * * * See Indirect (facilities & administrative (F&A)) costs in
Sec. 200.1.
* * * * *
0
88. Amend Sec. 200.401 by revising paragraph(a)(3) to read as follows:
Sec. 200.401 Application.
* * * * *
(3) Fixed amount awards. See also Sec. 200.1 and 200.201.
* * * * *
0
89. Revise Sec. 200.402 to read as follows:
Sec. 200.402 Composition and timing of costs.
(a) Total cost. The total cost of a Federal award is the sum of the
allowable direct and allocable indirect costs less any applicable
credits.
(b) Timing of costs. Costs must be charged to the approved budget
period in which they were incurred except where noted in the specific
cost principle.
0
90. Amend Sec. 200.403 by revising paragraph (g) to read as follows:
Sec. 200.403 Factors affecting allowability of costs.
* * * * *
(g) Be adequately documented. See also Sec. Sec. 200.300 Statutory
and national policy requirements through 200.308 Revision of budget and
program plans of this part.
0
91. Revise Sec. 200.405 paragraph (d) to read as follows:
Sec. 200.405 Allocable costs.
* * * * *
(d) Direct cost allocation principles. If a cost benefits two or
more projects or activities in proportions that can be
[[Page 3803]]
determined without undue effort or cost, the cost must be allocated to
the projects based on the proportional benefit. If a cost benefits two
or more projects or activities in proportions that cannot be determined
because of the interrelationship of the work involved, then,
notwithstanding paragraph (c) of this section, the costs may be
allocated or transferred to benefitted projects on any reasonable
documented basis. Where the purchase of equipment or other capital
asset is specifically authorized under a Federal award, the costs are
assignable to the Federal award regardless of the use that may be made
of the equipment or other capital asset involved when no longer needed
for the purpose for which it was originally required. See also
Sec. Sec. 200.309 through 200.315 and 200.439.
* * * * *
0
92. Amend Sec. 200.407 by revising paragraphs (e) and (f) to read as
follows:
Sec. 200.407 Prior written approval (prior approval).
* * * * *
(e) Sec. 200.310 Real property;
(f) Sec. 200.312 Equipment;
* * * * *
0
93. Amend Sec. 200.410 by revising the last sentence to read as
follows:
Sec. 200.410 Collection of unallowable costs.
* * * See also Subpart D of this part, Sec. Sec. 200.300 through
200.308.
0
94. Amend Sec. 200.413 by revising paragraph (b) to read as follows:
Sec. 200.413 Direct costs.
* * * * *
(b) Application to Federal awards. Identification with the Federal
award rather than the nature of the goods and services involved is the
determining factor in distinguishing direct from indirect (F&A) costs
of Federal awards. Typical costs charged directly to a Federal award
are the compensation of employees who work on that award, their related
fringe benefit costs, the costs of materials and other items of expense
incurred for the Federal award. If directly related to a specific
award, certain costs that otherwise would be treated as indirect costs
may also be considered direct cost, examples include extraordinary
utility consumption, the cost of materials supplied from stock or
services rendered by specialized facilities, program evaluation costs,
or other institutional service operations.
* * * * *
0
95. Amend Sec. 200.414 by revising paragraphs (a), (c)(4), and (f) and
adding paragraph (h) to read as follows:
Sec. 200.414 Indirect (F&A) costs.
(a) Facilities and Administration Classification. For major
Institutions of Higher Education (IHE) and major nonprofit
organizations, indirect (F&A) costs must be classified within two broad
categories: ``Facilities'' and ``Administration.'' ``Facilities'' is
defined as depreciation on buildings, equipment and capital
improvement, interest on debt associated with certain buildings,
equipment and capital improvements, and operations and maintenance
expenses. ``Administration'' is defined as general administration and
general expenses such as the director's office, accounting, personnel
and all other types of expenditures not listed specifically under one
of the subcategories of ``Facilities'' (including cross allocations
from other pools, where applicable). For nonprofit organizations,
library expenses are included in the ``Administration'' category; for
IHEs, they are included in the ``Facilities'' category. Major IHEs are
defined as those required to use the Standard Format for Submission as
noted in Appendix III to Part 200, and Rate Determination for
Institutions of Higher Education paragraph C.11. Major nonprofit
organizations are those which receive more than $10 million dollars in
direct Federal funding.
* * * * *
(c) * * *
(4) As required under Sec. 200.204 Notices of funding
opportunities, the Federal awarding agency must include in the notice
of funding opportunity the policies relating to indirect cost rate
reimbursement, matching, or cost share as approved under paragraph
(e)(1) of this section. As appropriate, the Federal agency should
incorporate discussion of these policies into Federal awarding agency
outreach activities with non-Federal entities prior to the posting of a
notice of funding opportunity.
* * * * *
(f) In addition to the procedures outlined in the appendices in
paragraph (e) of this section, any non-Federal entity, except for those
non-Federal entities described in Appendix VII to Part 200, paragraph
D.1.b, may elect to charge a de minimis rate of 10% of modified total
direct costs (MTDC) which may be used indefinitely. No documentation is
required to provide proof of costs that are covered under the de
minimus indirect cost rate. As described in Sec. 200.403 Factors
affecting allowability of costs, costs must be consistently charged as
either indirect or direct costs, but may not be double charged or
inconsistently charged as both. If chosen, this methodology once
elected must be used consistently for all Federal awards until such
time as a non-Federal entity chooses to negotiate for a rate, which the
non-Federal entity may apply to do at any time.
* * * * *
(h) All rate agreements from non-Federal entities must be available
publicly on an OMB-Designated Federal website.
0
96. Amend Sec. 200.419 by revising paragraphs (b)(1) and (b)(2) to
read as follows:
Sec. 200.419 Cost accounting standards and disclosure statement.
* * * * *
(b) * * *
(1) The DS-2 must be submitted to the cognizant agency for indirect
costs with a copy to the IHE's cognizant agency for audit. The initial
DS-2 and revisions to the DS-2 must be submitted in coordination with
the IHE's F&A rate proposal, unless an earlier submission is requested
by the cognizant agency for indirect costs. IHEs with CAS-covered
contracts or subcontracts meeting the dollar threshold in 48 CFR
9903.202-1(f) must submit their initial DS-2 or revisions no later than
prior to the award of a CAS-covered contract or subcontract.
(2) An IHE must maintain an accurate DS-2 and comply with disclosed
cost accounting practices. An IHE must file amendments to the DS-2 to
the cognizant agency for indirect costs in advance of a disclosed
practice being changed to comply with a new or modified standard, or
when a practice is changed for other reasons. An IHE may proceed with
implementing the change after it has notified the Federal cognizant
agency for indirect costs. If the change represents a variation from 2
CFR 200, the change may require approval by the Federal cognizant
agency for indirect costs, in accordance with Sec. 200.102(b).
Amendments of a DS-2 may be submitted at any time. Resubmission of a
complete, updated DS-2 is discouraged except when there are extensive
changes to disclosed practices.
* * * * *
0
97. Amend Sec. 200.430 by revising paragraph (h) introductory text and
the first two sentences of paragraph (h)(3) to read as follows:
Sec. 200.430 Compensation--personal services.
* * * * *
(h) Institutions of Higher Education (IHEs).
* * * * *
[[Page 3804]]
(3) Intra-Institution of Higher Education (IHE) consulting. Intra-
IHE consulting by faculty should be undertaken as an IHE responsibility
requiring no compensation in addition to IBS. * * *
* * * * *
0
98. Revise Sec. 200.431 to read as follows.
Sec. 200.431 Compensation--fringe benefits.
(a) Fringe benefits are allowances and services provided by
employers to their employees as compensation in addition to regular
salaries and wages. Fringe benefits include, but are not limited to,
the costs of leave (vacation, family-related, sick or military),
employee insurance, pensions, and unemployment benefit plans. Except as
provided elsewhere in these principles, the costs of fringe benefits
are allowable provided that the benefits are reasonable and are
required by law, non-Federal entity-employee agreement, or an
established policy of the non-Federal entity.
(b) Leave. The cost of fringe benefits in the form of regular
compensation paid to employees during periods of authorized absences
from the job, such as for annual leave, family-related leave, sick
leave, holidays, court leave, military leave, administrative leave, and
other similar benefits, are allowable if all of the following criteria
are met:
(1) They are provided under established written leave policies;
(2) The costs are equitably allocated to all related activities,
including Federal awards; and,
(3) The accounting basis (cash or accrual) selected for costing
each type of leave is consistently followed by the non-Federal entity
or specified grouping of employees.
(i) When a non-Federal entity uses the cash basis of accounting,
the cost of leave is recognized in the period that the leave is taken
and paid for. Payments for unused leave when an employee retires or
terminates employment are allowable in the year of payment.
(ii) The accrual basis may be only used for those types of leave
for which a liability as defined by GAAP exists when the leave is
earned. When a non-Federal entity uses the accrual basis of accounting,
allowable leave costs are the lesser of the amount accrued or funded.
(c) The cost of fringe benefits in the form of employer
contributions or expenses for social security; employee life, health,
unemployment, and worker's compensation insurance (except as indicated
in Sec. 200.447); pension plan costs (see paragraph (i) of this
section); and other similar benefits are allowable, provided such
benefits are granted under established written policies. Such benefits,
must be allocated to Federal awards and all other activities in a
manner consistent with the pattern of benefits attributable to the
individuals or group(s) of employees whose salaries and wages are
chargeable to such Federal awards and other activities, and charged as
direct or indirect costs in accordance with the non-Federal entity's
accounting practices.
(d) Fringe benefits may be assigned to cost objectives by
identifying specific benefits to specific individual employees or by
allocating on the basis of entity-wide salaries and wages of the
employees receiving the benefits. When the allocation method is used,
separate allocations must be made to selective groupings of employees,
unless the non-Federal entity demonstrates that costs in relationship
to salaries and wages do not differ significantly for different groups
of employees.
(e) Insurance. See also Sec. 200.447(d)(1) and (2).
(1) Provisions for a reserve under a self-insurance program for
unemployment compensation or workers' compensation are allowable to the
extent that the provisions represent reasonable estimates of the
liabilities for such compensation, and the types of coverage, extent of
coverage, and rates and premiums would have been allowable had
insurance been purchased to cover the risks. However, provisions for
self-insured liabilities which do not become payable for more than one
year after the provision is made must not exceed the present value of
the liability.
(2) Costs of insurance on the lives of trustees, officers, or other
employees holding positions of similar responsibility are allowable
only to the extent that the insurance represents additional
compensation. The costs of such insurance when the non-Federal entity
is named as beneficiary are unallowable.
(3) Actual claims paid to or on behalf of employees or former
employees for workers' compensation, unemployment compensation,
severance pay, and similar employee benefits (e.g., post-retirement
health benefits), are allowable in the year of payment provided that
the non-Federal entity follows a consistent costing policy.
(f) Automobiles. That portion of automobile costs furnished by the
non-Federal entity that relates to personal use by employees (including
transportation to and from work) is unallowable as fringe benefit or
indirect (F&A) costs regardless of whether the cost is reported as
taxable income to the employees.
(g) Pension Plan Costs. Pension plan costs which are incurred in
accordance with the established policies of the non-Federal entity are
allowable, provided that:
(1) Such policies meet the test of reasonableness.
(2) The methods of cost allocation are not discriminatory.
(3) The costs assigned to a given fiscal year are funded for all
plan participants within six months after the end of that year.
However, increases to normal and past service pension costs caused by a
delay in funding the actuarial liability beyond 30 calendar days after
each quarter of the year to which such costs are assignable are
unallowable. Non-Federal entity may elect to follow the ``Cost
Accounting Standard for Composition and Measurement of Pension Costs''
(48 CFR 9904.412).
(4) Pension plan termination insurance premiums paid pursuant to
the Employee Retirement Income Security Act (ERISA) of 1974 (29 U.S.C.
1301-1461) are allowable. Late payment charges on such premiums are
unallowable. Excise taxes on accumulated funding deficiencies and other
penalties imposed under ERISA are unallowable.
(5) Pension plan costs may be computed using a pay-as-you-go method
or an acceptable actuarial cost method in accordance with established
written policies of the non-Federal entity.
(i) For pension plans financed on a pay-as-you-go method, allowable
costs will be limited to those representing actual payments to retirees
or their beneficiaries.
(ii) Pension costs calculated using an actuarial cost-based method
recognized by GAAP are allowable for a given fiscal year if they are
funded for that year within six months after the end of that year.
Costs funded after the six month period (or a later period agreed to by
the cognizant agency for indirect costs) are allowable in the year
funded. The cognizant agency for indirect costs may agree to an
extension of the six month period if an appropriate adjustment is made
to compensate for the timing of the charges to the Federal Government
and related Federal reimbursement and the non-Federal entity's
contribution to the pension fund. Adjustments may be made by cash
refund or other equitable procedures to compensate the Federal
Government for the time value of Federal reimbursements in excess of
contributions to the pension fund.
(iii) Amounts funded by the non-Federal entity in excess of the
actuarially determined amount for a
[[Page 3805]]
fiscal year may be used as the non-Federal entity's contribution in
future periods.
(iv) When a non-Federal entity converts to an acceptable actuarial
cost method, as defined by GAAP, and funds pension costs in accordance
with this method, the unfunded liability at the time of conversion is
allowable if amortized over a period of years in accordance with GAAP.
(v) The Federal Government must receive an equitable share of any
previously allowed pension costs (including earnings thereon) which
revert or inure to the non-Federal entity in the form of a refund,
withdrawal, or other credit.
(h) Post-Retirement Health. Post-retirement health plans (PRHP)
refers to costs of health insurance or health services not included in
a pension plan covered by paragraph (g) of this section for retirees
and their spouses, dependents, and survivors. PRHP costs may be
computed using a pay-as-you-go method or an acceptable actuarial cost
method in accordance with established written policies of the non-
Federal entity.
(1) For PRHP financed on a pay-as-you-go method, allowable costs
will be limited to those representing actual payments to retirees or
their beneficiaries.
(2) PRHP costs calculated using an actuarial cost method recognized
by GAAP are allowable if they are funded for that year within six
months after the end of that year. Costs funded after the six month
period (or a later period agreed to by the cognizant agency) are
allowable in the year funded. The Federal cognizant agency for indirect
costs may agree to an extension of the six month period if an
appropriate adjustment is made to compensate for the timing of the
charges to the Federal Government and related Federal reimbursements
and the non-Federal entity's contributions to the PRHP fund.
Adjustments may be made by cash refund, reduction in current year's
PRHP costs, or other equitable procedures to compensate the Federal
Government for the time value of Federal reimbursements in excess of
contributions to the PRHP fund.
(3) Amounts funded in excess of the actuarially determined amount
for a fiscal year may be used as the non-Federal entity contribution in
a future period.
(4) When a non-Federal entity converts to an acceptable actuarial
cost method and funds PRHP costs in accordance with this method, the
initial unfunded liability attributable to prior years is allowable if
amortized over a period of years in accordance with GAAP, or, if no
such GAAP period exists, over a period negotiated with the cognizant
agency for indirect costs.
(5) To be allowable in the current year, the PRHP costs must be
paid either to:
(i) An insurer or other benefit provider as current year costs or
premiums, or
(ii) An insurer or trustee to maintain a trust fund or reserve for
the sole purpose of providing post-retirement benefits to retirees and
other beneficiaries.
(6) The Federal Government must receive an equitable share of any
amounts of previously allowed post-retirement benefit costs (including
earnings thereon) which revert or inure to the non-Federal entity in
the form of a refund, withdrawal, or other credit.
(i) Severance Pay. (1) Severance pay, also commonly referred to as
dismissal wages, is a payment in addition to regular salaries and
wages, by non-Federal entities to workers whose employment is being
terminated. Costs of severance pay are allowable only to the extent
that in each case, it is required by
(i) Law;
(ii) Employer-employee agreement;
(iii) Established policy that constitutes, in effect, an implied
agreement on the non-Federal entity's part; or
(iv) Circumstances of the particular employment.
(2) Costs of severance payments are divided into two categories as
follows:
(i) Actual normal turnover severance payments must be allocated to
all activities; or, where the non-Federal entity provides for a reserve
for normal severances, such method will be acceptable if the charge to
current operations is reasonable in light of payments actually made for
normal severances over a representative past period, and if amounts
charged are allocated to all activities of the non-Federal entity.
(ii) Measurement of costs of abnormal or mass severance pay by
means of an accrual will not achieve equity to both parties. Thus,
accruals for this purpose are not allowable. However, the Federal
Government recognizes its responsibility to participate, to the extent
of its fair share, in any specific payment. Prior approval by the
Federal awarding agency or cognizant agency for indirect cost, as
appropriate, is required.
(3) Costs incurred in certain severance pay packages which are in
an amount in excess of the normal severance pay paid by the non-Federal
entity to an employee upon termination of employment and are paid to
the employee contingent upon a change in management control over, or
ownership of, the non-Federal entity's assets, are unallowable.
(4) Severance payments to foreign nationals employed by the non-
Federal entity outside the United States, to the extent that the amount
exceeds the customary or prevailing practices for the non-Federal
entity in the United States, are unallowable, unless they are necessary
for the performance of Federal programs and approved by the Federal
awarding agency.
(5) Severance payments to foreign nationals employed by the non-
Federal entity outside the United States due to the termination of the
foreign national as a result of the closing of, or curtailment of
activities by, the non-Federal entity in that country, are unallowable,
unless they are necessary for the performance of Federal programs and
approved by the Federal awarding agency.
(j) For IHEs only. (1) Fringe benefits in the form of undergraduate
and graduate tuition or remission of tuition for individual employees
are allowable, provided such benefits are granted in accordance with
established non-Federal entity policies, and are distributed to all
non-Federal entity activities on an equitable basis. Tuition benefits
for family members other than the employee are unallowable.
(2) Fringe benefits in the form of tuition or remission of tuition
for individual employees not employed by IHEs are limited to the tax-
free amount allowed per section 127 of the Internal Revenue Code as
amended.
(3) IHEs may offer employees tuition waivers or tuition reductions,
provided that the benefit does not discriminate in favor of highly
compensated employees. Employees can exercise these benefits at other
institutions according to institutional policy. See Sec. 200.466
Scholarships and student aid costs, for treatment of tuition remission
provided to students.
(k) For IHEs whose costs are paid by state or local governments,
fringe benefit programs (such as pension costs and FICA) and any other
benefits costs specifically incurred on behalf of, and in direct
benefit to, the non-Federal entity, are allowable costs of such non-
Federal entities whether or not these costs are recorded in the
accounting records of the non-Federal entities, subject to the
following:
(1) The costs meet the requirements of Basic Considerations in
Sec. Sec. 200.402 Composition of costs through 200.411 Adjustment of
previously negotiated
[[Page 3806]]
indirect (F&A) cost rates containing unallowable costs of this subpart;
(2) The costs are properly supported by approved cost allocation
plans in accordance with applicable Federal cost accounting principles;
and
(3) The costs are not otherwise borne directly or indirectly by the
Federal Government.
Sec. 200.433 [Amended]
0
99. In Sec. 200.433 amend paragraph (b) by removing the words
``200.309 Period of Performance'' and adding, in its place, ``200.308
Revision of budget and program plans''.
Sec. 200.434 [Amended]
0
100. In Sec. 200.434 amend paragraph (g)(2) by removing the words
``200.309 Period of Performance'' wherever it appears and adding, in
its place, ``200.308''.
0
101. Amend Sec. 200.436 by revising paragraph (c) introductory text,
paragraphs (c)(3), (c)(4), and (e) and adding paragraph (c)(5) to read
as follows:
Sec. 200.436 Depreciation.
* * * * *
(c) Depreciation is computed applying the following rules. The
computation of depreciation must be based on the acquisition cost of
the assets involved. For an asset donated to the non-Federal entity by
a third party, its fair market value at the time of the donation must
be considered as the acquisition cost. Such assets may be depreciated
or claimed as matching but not both. For the computation of
depreciation, the acquisition cost will exclude:
* * * * *
(3) Any portion of the cost of buildings and equipment contributed
by or for the non-Federal entity that are already claimed as matching
or where law or agreement prohibits recovery;
(4) Any asset acquired solely for the performance of a non-Federal
award; and
(5) Assets that were directly paid for and expensed using Federal
financial assistance.
* * * * *
(e) Charges for depreciation must be supported by adequate property
records, and physical inventories must be taken at least once every two
years to ensure that the assets exist and are usable, used, and needed.
Statistical sampling techniques may be used in taking these
inventories. In addition, adequate depreciation records showing the
amount of depreciation must be maintained.
0
102. Amend Sec. 200.439 by revising paragraph (a), paragraph (b)(3),
and (b)(7) to read as follows:
Sec. 200.439 Equipment and other capital expenditures.
(a) See the definitions for Capital expenditures, Equipment,
Special purpose equipment, General purpose equipment, Acquisition cost,
and Capital assets in Sec. 200.1.
(b) * * *
(3) Capital expenditures for improvements to land, buildings, or
equipment which materially increase their value or useful life are
unallowable as a direct cost except with the prior written approval of
the Federal awarding agency, or pass-through entity. See Sec. 200.436
Depreciation, for rules on the allowability of depreciation on
buildings, capital improvements, and equipment. See also Sec. 200.465.
* * * * *
(7) Equipment and other capital expenditures are unallowable as
indirect costs. See Sec. 200.436.
0
103. Revise Sec. 200.433 paragraph (d) to read as follows:
Sec. 200.443 Gains and losses on disposition of depreciable assets.
* * * * *
(d) When assets acquired with Federal funds, in part or wholly, are
disposed of, the distribution of the proceeds must be made in
accordance with Sec. Sec. 200.309 through 200.315.
0
104. Revise Sec. 200.444 paragraph (b) to read as follows:
Sec. 200.444 General costs of government.
* * * * *
(b) For Indian tribes and Councils of Governments (COGs) (see Local
government in Sec. 200.1), up to 50% of salaries and expenses directly
attributable to managing and operating Federal programs by the chief
executive and his or her staff can be included in the indirect cost
calculation without documentation.
0
105. Amend Sec. 200.449 by revising paragraphs (b)(1) and (c)(4) to
read as follows:
Sec. 200.449 Interest.
* * * * *
(b)(1) Capital assets is defined as noted in the definition of
Capital assets in Sec. 200.1. An asset cost includes (as applicable)
acquisition costs, construction costs, and other costs capitalized in
accordance with GAAP.
* * * * *
(c) * * *
(4) The non-Federal entity limits claims for Federal reimbursement
of interest costs to the least expensive alternative. For example, a
lease contract that transfers ownership by the end of the contract may
be determined less costly than purchasing through debt financing, in
which case reimbursement must be limited to the amount of interest
determined if leasing had been used.
* * * * *
0
106. Revise Sec. 200.456 to read as follows:
Sec. 200.456 Participant support costs.
Participant support costs as defined in Sec. 200.1 and are
allowable with the prior approval of the Federal awarding agency.
0
107. Amend Sec. 200.458 by revising the last sentence to read as
follows:
Sec. 200.458 Pre-award costs.
* * * If charged to the award, these costs must be charged to the
initial budget period of the award, unless otherwise specified by the
Federal awarding agency.
0
108. Amend Sec. 200.461 by revising paragraph (b)(3) to read as
follows:
Sec. 200.461 Publication and printing costs.
* * * * *
(b) * * *
(3) The non-Federal entity may charge the Federal award before
closeout for the costs of publication or sharing of research results if
the costs are not incurred during the period of performance of the
Federal award. If charged to the award, these costs must be charged to
the final budget period of the award, unless otherwise specified by the
Federal awarding agency.
0
109. Amend Sec. 200.465 by
0
a. Redesignating paragraph (c)(5) as paragraph (d).
0
b. Redesignating paragraph (c)(6) as paragraph (f);
0
c. Revising newly redesignated paragraph (d); and
0
d. Adding paragraph (e).
The addition and revision to read as follows:
Sec. 200.465 Rental costs of real property and equipment.
* * * * *
(d) Rental costs under leases which are required to be accounted
for as a financed purchase under GASB standards or a finance lease
under FASB standards under GAAP are allowable only up to the amount (as
explained in paragraph (b) of this section) that would be allowed had
the non-Federal entity purchased the property on the date the lease
agreement was executed. Interest costs related to these leases are
allowable to the extent they meet the criteria in Sec. 200.449
Interest.
[[Page 3807]]
Unallowable costs include amounts paid for profit, management fees, and
taxes that would not have been incurred had the non-Federal entity
purchased the property.
(e) Rental or lease payments are allowable under lease contracts
where the non-Federal entity is required to recognize an intangible
right-to-use lease asset (per GASB) or right of use operating lease
asset (per FASB) for purposes of financial reporting in accordance to
GAAP.
* * * * *
0
110. Amend Sec. 200.509 by revising paragraph (a) to read as follows:
Sec. 200.509 Auditor selection.
(a) Auditor procurement. In procuring audit services, the auditee
must follow the procurement standards prescribed by the Procurement
Standards in Sec. Sec. 200.316 through 20.326 or the FAR (48 CFR part
42), as applicable. When procuring audit services, the objective is to
obtain high-quality audits. In requesting proposals for audit services,
the objectives and scope of the audit must be made clear and the non-
Federal entity must request a copy of the audit organization's peer
review report which the auditor is required to provide under GAGAS.
Factors to be considered in evaluating each proposal for audit services
include the responsiveness to the request for proposal, relevant
experience, availability of staff with professional qualifications and
technical abilities, the results of peer and external quality control
reviews, and price. Whenever possible, the auditee must make positive
efforts to utilize small businesses, minority-owned firms, and women's
business enterprises, in procuring audit services as stated in Sec.
200.320, or the FAR (48 CFR part 42), as applicable.
* * * * *
0
111. Amend Sec. 200.510 by revising paragraph (b)(3) to read as
follows:
Sec. 200.510 Financial statements.
* * * * *
(b) * * *
(3) Provide total Federal awards expended for each individual
Federal program and the Assistance listing number or other identifying
number when the Assistance listings information is not available. For a
cluster of programs also provide the total for the cluster.
* * * * *
0
112. Amend 200.513 by revising paragraphs (a)(1), (a)(3)(ii),
(a)(3)(vii), paragraph (b) introductory text, paragraph (c)
introductory text, and paragraph (c)(3)(iii) to read as follows:
Sec. 200.513 Responsibilities.
(a)(1) Cognizant agency for audit responsibilities. A non-Federal
entity expending more than $50 million a year in Federal awards must
have a cognizant agency for audit. The designated cognizant agency for
audit must be the Federal awarding agency that provides the predominant
amount of funding directly (direct funding) to a non-Federal entity
unless OMB designates a specific cognizant agency for audit. When the
direct funding represents less than 25 percent of the total funding
received by the non-Federal entity (as prime and sub awards), then the
Federal agency with the predominant amount of total funding is the
designated cognizant agency for audit.
* * * * *
(3) * * *
(ii) Obtain or conduct quality control reviews on selected audits
made by non-Federal auditors, and provide the results to other
interested organizations. Cooperate and provide support to the Federal
agency designated by OMB to lead a governmentwide project to determine
the quality of single audits by providing a statistically reliable
estimate of the extent that single audits conform to applicable
requirements, standards, and procedures; and to make recommendations to
address noted audit quality issues, including recommendations for any
changes to applicable requirements, standards and procedures indicated
by the results of the project. The governmentwide project can rely on
the current and on-going quality control review work performed by the
agency. This governmentwide audit quality project must be performed
once every 6 years beginning with audits submitted in 2021 or at such
other interval as determined by OMB, and the results must be public.
* * * * *
(vii) Coordinate a management decision for cross-cutting audit
findings (as defined in Cross-cutting audit finding in Sec. 200.1)
that affect the Federal programs of more than one agency when requested
by any Federal awarding agency whose awards are included in the audit
finding of the auditee.
* * * * *
(b) Oversight agency for audit responsibilities. An auditee who
does not have a designated cognizant agency for audit will be under the
general oversight of the Federal agency determined in accordance with
the Oversight agency for audit. A Federal agency with oversight for an
auditee may reassign oversight to another Federal agency that agrees to
be the oversight agency for audit. Within 30 calendar days after any
reassignment, both the old and the new oversight agency for audit must
provide notice of the change to the FAC, the auditee, and, if known,
the auditor. The oversight agency for audit:
* * * * *
(c) Federal awarding agency responsibilities. The Federal awarding
agency must perform the following for the Federal awards it makes (See
also the requirements of Sec. 200.211):
* * * * *
(3) * * *
(iii) Use cooperative audit resolution mechanisms (see Cooperative
audit resolution) to improve Federal program outcomes through better
audit resolution, follow-up, and corrective action; and
* * * * *
0
113. Revise Sec. 200.515 paragraph (a) to read as follows:
Sec. 200.515 Audit reporting.
* * * * *
(a) An opinion (or disclaimer of opinion) as to whether the
financial statements are presented fairly in all material respects in
accordance with generally accepted accounting principles (or a special
purpose framework such as cash, modified cash, or regulatory) and an
opinion (or disclaimer of opinion) as to whether the schedule of
expenditures of Federal awards is fairly stated in all material
respects in relation to the financial statements as a whole.
* * * * *
Sec. 200.516 [Amended]
0
114. Amend Sec. 200.516 by removing ``CFDA'' wherever it appears and
adding, in its place, ``Assistance listing''.
0
115. Amend Appendix I to Part 200 by revising paragraphs (A), the first
paragraph of (B), paragraphs (D)(3), (D)(4), (D)(5), (E)(3),
(E)(3(iii), and (F)(1) to read as follows:
Appendix I to Part 200--Full Text of Notice of Funding Opportunity
* * * * *
A. Program Description--Required
This section contains the full program description of the
funding opportunity. It may be as long as needed to adequately
communicate to potential applicants the areas in which funding may
be provided. It describes the Federal awarding agency's funding
priorities or the technical or focus areas in which the Federal
awarding agency intends to provide assistance. As appropriate, it
may include any program history (e.g., whether this is a new program
or a new or changed area of program emphasis). This
[[Page 3808]]
section must include program goals and objectives, a reference to
the relevant assistance listing, a description of how the award will
contribute to the achievement of the program's goals and objectives,
and the expected performance indicators and may include examples of
successful projects that have been funded previously. This section
also may include other information the Federal awarding agency deems
necessary, and must at a minimum include citations for authorizing
statutes and regulations for the funding opportunity.
B. Federal Award Information--Required
This section provides sufficient information to help an
applicant make an informed decision about whether to submit a
proposal. Relevant information could include the total amount of
funding that the Federal awarding agency expects to award through
the announcement; the expected performance indicators, targets,
baseline data, and data collection; the anticipated number of
Federal awards; the expected amounts of individual Federal awards
(which may be a range); the amount of funding per Federal award, on
average, experienced in previous years; and the anticipated start
dates and periods of performance for new Federal awards. This
section also should address whether applications for renewal or
supplementation of existing projects are eligible to compete with
applications for new Federal awards.
* * * * *
D. * * *
3. Unique entity identifier and System for Award Management
(SAM)--Required.
This paragraph must state clearly that each applicant (unless
the applicant is an individual or Federal awarding agency that is
excepted from those requirements under 2 CFR 25.110(b) or (c), or
has an exception approved by the Federal awarding agency under 2 CFR
25.110(d)) is required to:
(i) Be registered in SAM before submitting its application;
(ii) Provide a valid unique entity identifier in its
application; and
(iii) Continue to maintain an active SAM registration with
current information at all times during which it has an active
Federal award or an application or plan under consideration by a
Federal awarding agency. It also must state that the Federal
awarding agency may not make a Federal award to an applicant until
the applicant has complied with all applicable unique entity
identifier and SAM requirements and, if an applicant has not fully
complied with the requirements by the time the Federal awarding
agency is ready to make a Federal award, the Federal awarding agency
may determine that the applicant is not qualified to receive a
Federal award and use that determination as a basis for making a
Federal award to another applicant.
4. Submission Dates and Times--Required. Announcements must
identify due dates and times for all submissions. This includes not
only the full applications but also any preliminary submissions
(e.g., letters of intent, white papers, or pre-applications). It
also includes any other submissions of information before Federal
award that are separate from the full application. If the funding
opportunity is a general announcement that is open for a period of
time with no specific due dates for applications, this section
should say so. Note that the information on dates that is included
in this section also must appear with other overview information in
a location preceding the full text of the announcement (see Sec.
200.204).
* * * * *
5. Intergovernmental Review--Required, if applicable. If the
funding opportunity is subject to Executive Order 12372,
``Intergovernmental Review of Federal Programs,'' the notice must
say so and applicants must contact their state's Single Point of
Contact (SPOC) to find out about and comply with the state's process
under Executive Order 12372, it may be useful to inform potential
applicants that the names and addresses of the SPOCs are listed in
the Office of Management and Budget's website.
* * * * *
E. * * *
3. For any Federal award under a notice of funding opportunity,
if the Federal awarding agency anticipates that the total Federal
share will be greater than the simplified acquisition threshold on
any Federal award under a notice of funding opportunity may include,
over the period of performance, this section must also inform
applicants:
* * * * *
iii. That the Federal awarding agency will consider any comments
by the applicant, in addition to the other information in the
designated integrity and performance system, in making a judgment
about the applicant's integrity, business ethics, and record of
performance under Federal awards when completing the review of risk
posed by applicants as described in Sec. 200.206.
* * * * *
F. Federal Award Administration Information
1. Federal Award Notices--Required. This section must address
what a successful applicant can expect to receive following
selection. If the Federal awarding agency's practice is to provide a
separate notice stating that an application has been selected before
it actually makes the Federal award, this section would be the place
to indicate that the letter is not an authorization to begin
performance (to the extent that it allows charging to Federal awards
of pre-award costs at the non-Federal entity's own risk). This
section should indicate that the notice of Federal award signed by
the grants officer (or equivalent) is the authorizing document, and
whether it is provided through postal mail or by electronic means
and to whom. It also may address the timing, form, and content of
notifications to unsuccessful applicants. See also Sec. 200.211.
* * * * *
0
116. Amend Appendix II to Part 200 revising paragraph (A) and adding
paragraph (K) to read as follows:
Appendix II to Part 200--Contract Provisions for Non-Federal Entity
Contracts Under Federal Awards
* * * * *
(A) Contracts for more than the simplified acquisition
threshold, which is the inflation adjusted amount determined by the
Civilian Agency Acquisition Council and the Defense Acquisition
Regulations Council (Councils) as authorized by 41 U.S.C. 1908, must
address administrative, contractual, or legal remedies in instances
where contractors violate or breach contract terms, and provide for
such sanctions and penalties as appropriate.
* * * * *
(K) See Sec. 200.216.
0
117. Amend Appendix III to Part 200 by
0
a. Revising paragraphs (B)(4)(c)(2)(ii)(B) and (C)(2);
0
b. Redesignating paragraph (C)(7)(7) as paragraph (C)(7)(a);
0
c. Revising paragraph (C)(11)(a)(1); and
0
d. Revising paragraph (E).
The revisions read as follows:
Appendix III to Part 200--Indirect (F&A) Costs Identification and
Assignment, and Rate Determination for Institutions of Higher Education
(IHEs)
* * * * *
B. * * *
4. * * *
c. * * *
2. * * *
(ii) * * *
B. In July 2012, values for these two indices (taken
respectively from the Lawrence Berkeley Laboratory ``Labs for the
21st Century'' benchmarking tool and the US Department of Energy
``Buildings Energy Databook'' and were 310 kBtu/sq ft-yr. and 155
kBtu/sq ft-yr., so that the adjustment ratio is 2.0 by this
methodology. To retain currency, OMB will adjust the EUI numbers
from time to time (no more often than annually nor less often than
every 5 years), using reliable and publicly disclosed data. Current
values of both the EUIs and the REUI will be posted on the OMB
website.
* * * * *
C. * * *
2. The Distribution Basis
Indirect (F&A) costs must be distributed to applicable Federal
awards and other benefitting activities within each major function
(see section A.1, Major functions of an institution) on the basis of
modified total direct costs (MTDC), consisting of all salaries and
wages, fringe benefits, materials and supplies, services, travel,
and up to the first $25,000 of each subaward (regardless of the
period covered by the subaward). MTDC is defined in Sec. 200.1
Definitions. For this purpose, an indirect (F&A) cost rate should be
determined for each of the separate indirect (F&A) cost pools
developed pursuant to subsection 1. The rate in each case should be
stated as the percentage which the amount of the particular indirect
(F&A) cost pool is
[[Page 3809]]
of the modified total direct costs identified with such pool.
* * * * *
11. * * *
a. * * *
(1) Cost negotiation cognizance is assigned to the Department of
Health and Human Services (HHS) or the Department of Defense's
Office of Naval Research (DOD), normally depending on which of the
two agencies (HHS or DOD) provides more funds directly to the
educational institution for the most recent three years. Information
on funding must be derived from relevant data gathered by the
National Science Foundation. In cases where neither HHS nor DOD
provides Federal funding directly to an educational institution, the
cognizant agency for indirect costs assignment must default to HHS.
Notwithstanding the method for cognizance determination described in
this section, other arrangements for cognizance of a particular
educational institution may also be based in part on the types of
research performed at the educational institution and must be
decided based on mutual agreement between HHS and DOD. Where a non-
Federal entity only receives funds as a subrecipient, see Sec.
200.331 Requirements for pass-through entities.
E. Documentation requirements. The standard format for
documentation requirements for indirect (indirect (F&A)) rate
proposals for claiming costs under the regular method is available
on the OMB website.
* * * * *
0
118. Amend Appendix IV to Part 200 by revising paragraphs (B)(2)(c),
(B)(3)(f) and (C)(2)(a) to read as follows:
Appendix IV to Part 200--Indirect (F&A) Costs Identification and
Assignment, and Rate Determination for Nonprofit Organizations
* * * * *
B. * * *
2. * * *
c. The distribution base may be total direct costs (excluding
capital expenditures and other distorting items, such as subawards
for $25,000 or more), direct salaries and wages, or other base which
results in an equitable distribution. The distribution base must
exclude participant support costs as defined in Sec. 200.1.
* * * * *
3. * * *
f. Distribution basis. Indirect costs must be distributed to
applicable Federal awards and other benefitting activities within
each major function on the basis of MTDC (see definition in Sec.
200.1 Definitions of Part 200).
* * * * *
C. * * *
2. * * *
a. Unless different arrangements are agreed to by the Federal
agencies concerned, the Federal agency with the largest dollar value
of Federal awards directly funded to an organization will be
designated as the cognizant agency for indirect costs for the
negotiation and approval of the indirect cost rates and, where
necessary, other rates such as fringe benefit and computer charge-
out rates. Once an agency is assigned cognizance for a particular
nonprofit organization, the assignment will not be changed unless
there is a shift in the dollar volume of the Federal awards directly
funded to the organization for at least three years. All concerned
Federal agencies must be given the opportunity to participate in the
negotiation process but, after a rate has been agreed upon, it will
be accepted by all Federal agencies. When a Federal agency has
reason to believe that special operating factors affecting its
Federal awards necessitate special indirect cost rates in accordance
with section B.5 of this Appendix, it will, prior to the time the
rates are negotiated, notify the cognizant agency for indirect
costs. (See also Sec. 200.414 Indirect (F&A) costs of Part 200.) If
the nonprofit does not receive any funding from any Federal agency,
the pass-through entity is responsible for the negotiation of the
indirect cost rates in accordance with section 200.331(a)(4).
* * * * *
0
119. Amend Appendix V to Part 200 by revising the last sentence of
paragraph (A)(2) and paragraph (B)(4) to read as follows:
Appendix V to Part 200--State/Local Governmentwide Central Service Cost
Allocation Plans
A. * * *
2. * * * A copy of this brochure may be obtained from the HHS
Cost Allocation Services or at their website.
B. * * *
4. Cognizant agency for indirect costs is defined in Sec.
200.1. The determination of cognizant agency for indirect costs for
states and local governments is described in section F.1,
Negotiation and Approval of Central Service Plans.
* * * * *
0
120. Amend Appendix VII to Part 200 by revising the last sentence of
paragraph (A)(3) to read as follows:
Appendix VII to Part 200--States and Local Government and Indian Tribe
Indirect Cost Proposals
A. * * *
3. * * * A copy of this brochure may be obtained from HHS Cost
Allocation Services or at their website.
* * * * *
0
121. Revise Appendix XI to Part 200 to read as follows:
Appendix XI to Part 200--Compliance Supplement
The compliance supplement is available on the OMB website.
[FR Doc. 2019-28524 Filed 1-21-20; 8:45 am]
BILLING CODE 3110-01-P
