RES 2004-1574 - Construction of houses in Fontenelle View target area 0
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{ wl� Irl Robert C.Peters
City of Omaha �' �� 11"i s.5 i't Director
Mike Fahey,Mayor
December 14, 2004
Honorable President
and Members of the City Council,
The purpose of this Amendment is to provide funds for the fifth phase of construction for the
Fontenelle View Target Area that includes partial financing for an additional six (6) single-
family houses of which three (3) shall be purchased by low and moderate income households and
any qualified buyer can purchasing the remaining three (3) units. This project has received
approval for funding in order to ultimately reach the total development of forty-one (41) housing
units.
The original Agreement between the City of Omaha and Holy Name Housing Corporation, a
Nebraska Non-Profit Corporation (HNHC), located at 3014 North 45th Street, Omaha, Nebraska
68104, Sister Marilyn Ross, Executive Director, to fund this Project was executed and approved
by the City Council on March 31, 2000 from FY 2000 Community Development Block Grant
(CDBG) funds by Resolution No. 1018. Subsequently three Amendments were approved by the
City Council as follows: first amendment, FY 2001, October 30, 2001, Resolution No. 2777;
second amendment, FY 2002, March 5, 2002, Resolution No. 532; and the third amendment July
1, 2003, Resolution No.895. The attached proposed Resolution approves a fourth Amendment to
the Agreement, as amended. This Amendment allocates $300,000.00 in FY 2004 funding
comprised of funds in the amount of $150,000,00 in Community Development Block Grant
(CDBG) funds and $150,000.00 from the HOME Investment Partnerships Program (HOME).
Funding will provide partial financing for new construction of six (6) single-family houses and
the provision of deferred payment loans to assist qualified homebuyers in purchasing the houses
located in the Fontenelle View Target Area bounded by Fowler Avenue to the north, Ames
Avenue on the south, 45th Street on the east, and 46th Street on the west.
This project is being treated as an ongoing project and this is the fifth phase of the project.
Amending the Agreement is the most practical approach because the Davis Bacon wage decision
applies to the entire development of 41 units. Therefore, this is the fourth Amendment to the
agreement covering this development and the amendment will change the agreement on the
whole to consolidate terms and for ease in reviewing.
The FY 1999, FY 2001, FY 2002, FY 2003 and FY 2004 funds will provide partial financing to
complete the fifth phase of construction. Due to an increase in down payment assistance to the
homebuyer over the past few years and an increase in development subsidy grants to HNHC,
only twenty (20) houses have been constructed and sold, five (5) houses are currently in various
stages of construction and 12 lots are undeveloped. With this allocation of funds, HNHC will be
able to complete an additional six houses for a total of 31 units.
Honorable President
and Members of the City Council
Page 2
CDBG funding in the amount of $1,345,000.00 (comprised of $400,000.00 FY 1999,
$450,000.00 FY 2001, $245,000.00 FY 2002, $100,000.00 of FY 2003, and $150,000.00 FY
2004) shall be payable from CDBG Fontenelle View Housing Development Program, Fund No.
12186, Organization No. 129124.
HOME funding in the amount of $465,000.00 (comprised of $315,000.00 in FY 2003 and
$150,000.00 in FY 2004 program years) shall be payable from HOME Fontenelle View First-
Time Homebuyer Program, Fund No. 12179, Organization No. 128058. This Project is included
in the FY 2004 Consolidated Submission for Community Planning and Development Programs
approved by the City Council on November 4, 2003 by Resolution No. 1328 and is eligible for
funding.
The total Project cost for this phase of construction is estimated at $870,000.00, comprised of
$150,000.00 in CDBG funds, $150,000.00 in HOME funds, and $570,000.00 in private and other
funds.
HNHC (Developer/General Contractor) has on file a current Annual Contract Compliance
Report Form (CC-1) on file. The Contract Compliance Ordinance requires that the Human
Relations Director, at his discretion, conduct a preaward review of the employment practices of a
contractor with a City contract of$200,000.00 or more. As is City policy, the Human Relations
Director will review the Contractor to ensure compliance with the Contract Compliance
Ordinance prior to the expenditure of City Program Funds.
Authorizing the approval of this proposed Resolution will allow HNHC to successfully complete
the final construction phase of this worthwhile housing development project in the North Omaha
Community.
Your favorable consideration of this Resolution will be appreciated.
Respectfully submitted, Referred to City Council for Consideration:
Robert C. Peters a664 Date ayor's Office Date
Planning Director
Approved: Approved:
4.L.9046/14.(1eitilt4e , /-04
Carol A. Ebdon Date Gail Kinseyson Thom ��pp�� Date
Finance Director -�" " °�� Human Relations Director Oak
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A
FOURTH AMENDMENT
NEW CONSTRUCTION/HOMEBUYER AGREEMENT
COMMUNITY DEVELOPMENT BLOCK GRANT AND HOME INVESTMENT
PARTNERSHIPS FUNDING FOR CONTINUATION OF NEW CONSTRUCTION OF
SINGLE-FAMILY HOMES AND HOMEBUYER DEFERRED PAYMENT LOANS IN
FONTENELLE VIEW SUBDIVISION
Fiscal Years 1999,2001, 2002, 2003, and 2004
TABLE OF CONTENTS
SECTION 1 DEFINITIONS AND ABBREVIATIONS
SECTION 2 RESPONSIBILITIES OF DEVELOPER
2.01 Overall Project Performance
2.02 Phase Four Project Accomplishments
2.03 Total Cumulative Project Accomplishments
2.04 Speculation or Model Homes
2.05 Presold Houses
2.06 Project Budget
2.07 Term of Agreement
SECTION 3 CONDITIONS FOR RECEIPT OF CITY FINANCING
3.01 Documents Requirement by City
3.01.1 Property Insurance
3.01.2 Contracts
3.01.3 Bonding/Letter of Credit
3.01.4 Plan Submissions
3.01.5 Matching Funds
3.01.6 MBE/WBE Plan
3.01.7 Eligible Contractors
3.01.8 Section 504
3.01.9 Contractors' Insurance and Workers' Compensation
3.01.10 Insurance and Bonding
3.01.11 Funding Compliance Deadline
SECTION 4 PROJECT RESPONSIBILITIES OF THE DEVELOPER
4.01 Eligible Use of Funds
4.01.1 Use Restrictions
4.01.2 House Initial Sales Price Restrictions
4.02 Security for DPL
4.03 Terms and Conditions
4.04 Breach of Agreement
4.05 Lien Waivers
4.06 Ineligible/Eligible Cost
4.07 Lead-Based Paint Prohibition
4.08 Ongoing Property Restrictions
4.09 Davis Bacon Labor Standards
4.10 Property Standards
4.11 Affirmative Marketing Policy
4.12 Maintenance of Property
4.13 Homebuyer First Mortgage Financing
4.14 Homebuyer Counseling Services
SECTION 5 GENERAL ADMINISTRATION REQUIREMENTS OF DEVELOPER
5.01 Financial Management
5.02 Documentation and record-Keeping
5.03 Reports
5.04 Financial Status Reports
5.05 Record Retention
5.06 Personnel and Participant Conditions
SECTION 6 DEVELOPER'S COMPLIANCE WITH OTHER FEDERAL REGULATIONS
6.01 Environmental Review
6.02 Uniform Relocation Act
SECTION 7 RESPONSIBILITIES OF THE CITY
7.01 Performance Monitoring
7.02 Payments
7.03 Progress Payments
7.04 Inspections
7.05 Technical Assistance
SECTION 8 MUTUAL AGREEMENTS BETWEEN CITY AND DEVELOPER
8.01 Release of Information Laws
8.02 Applicable Laws
8.03 Interest of the City
8.04 Independent Contractor
8.05 Project Roles
8.06 Captions
8.07 Merger
8.08 Modification
8.09 Assignment
8.10 Strict Compliance
8.11 Termination
8.12 Reversion of Assets - CDBG Funds
8.13 Reversion of Assets -HOME Funds
8.14 Indemnification
8.15 Unenforceable Provisions
8.16 Disclosure of Lobbying
8.17 Notices
8.18 Applicability
SECTION 9 DEFAULT PROVISIONS
9.01 Remedies
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FOURTH AMENDMENT
NEW CONSTRUCTION/HOMEBUYER AGREEMENT
COMMUNITY DEVELOPMENT BLOCK GRANT AND HOME INVESTMENT
PARTNERSHIPS PROGRAMS FUNDING FOR CONTINUATION OF NEW
CONSTRUCTION OF SINGLE-FAMILY HOMES AND HOMEBUYER DEFERRED
PAYMENT LOANS IN FONTENELLE VIEW SUBDIVISION
THIS AMENDMENT is to amend the original Agreement entered into by and between
the City of Omaha, a Municipal Corporation in Douglas County, Nebraska (hereinafter referred
to as "City") and Holy Name Housing Corporation, a Nebraska Non-Profit Corporation,
(hereinafter referred to as "HNHC") approved by the City Council on March 31, 2000 by
Resolution No. 1018, and amended October 30, 2001 by Resolution No. 2777, March 5, 2002 by
Resolution No. 532, and July 1, 2003 by Resolution No.895.
WHEREAS, the original Agreement provided partial financing in the amount of
$400,000.00 of which $70,000.00 was a Grant for predevelopment and public improvement costs
and $330,000.00 was for partial construction financing as wells as for Deferred Payment Loans
provided to qualified low and moderate income homebuyers to assist in purchasing ten (10)
newly constructed single-family homes in the Fontenelle View Redevelopment Area; and,
WHEREAS, the Fontenelle View Project is an ongoing project in which the entire
development shall consist of forty one (41) single-family houses; and,
WHEREAS, this Amendment shall be the fourth Amendment to provide funds for the
fifth phase of construction for the Fontenelle View Target Area and, as such, this Amendment
shall be an Amendment on the whole of the original Agreement and previous amendments
approved in 2001, 2002 and 2003; and,
WHEREAS, City HOME Investment Partnerships Program (hereinafter referred to as
"HOME") and Community Development Block Grant Program (hereinafter referred to as
"CDBG") funds in the amount of$300,000.00 ($150,000.00 CDBG and $150,000.00 HOME),
have been allocated in FY 2004 to the fifth phase of the development; and,
WHEREAS, City CDBG funds designated to the Project to date amount to $1,345.000.00
from fiscal years 1999, 2001, 2002, 2003 and 2004, and an additional $465,000.00 was allocated
from HOME funds in 2003 and 2004 for the Project; and,
WHEREAS, it is in the best interest of the City and its residents to enter into an Amended
Agreement with HNHC for the successful completion of this worthwhile housing development
project.
NOW, THEREFORE, IN CONSIDERATION OF THESE MUTUAL COVENANTS,
HNHC and the City do hereby agree as follows:
All Recitals in the original Agreement approved March 31, 2000 by Resolution No. 1018,
and Sections 1 through 7 and language in its respective amendments approved October 30, 2001
by Resolution No. 2777, March 5, 2002 by Resolution No. 532 and July 1, 2003 by Resolution
No. 895 shall be deleted in their entirety and the following language shall be substituted in their
place and stead:
RECITALS:
WHEREAS, the City of Omaha is a municipal corporation located in Douglas County,
Nebraska, and is organized under the laws of the State of Nebraska, and is authorized and
empowered to exercise all powers conferred by the State constitution laws, Home Rule Charter
of the City of Omaha, 1956, as amended, and local ordinances, including but not limited, to the
power to contract; and,
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WHEREAS, the City of Omaha has applied for and received CDBG funds under Title I
of the Housing and Community Development Act of 1974, as amended, and HOME funds under
Title II of the National Affordable Housing Act of 1990, for the purpose of providing affordable
housing opportunities for low and moderate income residents, eliminating slum and blight, and
for other urgent community development needs; and,
WHEREAS, the Fontenelle View Redevelopment Area was originally a vacant site in
North Omaha and was determined to be a blighted and substandard area; and,
WHEREAS, following a Request for Proposals and an in-depth review, the Holy Name
Housing Corporation, was designated as the developer responsible for the new construction and
sale of single-family homes; and,
WHEREAS, the City's Consolidated Submission for Community Planning and
Development Programs (hereinafter referred to as "Consolidated Plans"), for the City outlining
priorities, programs and funding allocations for the Program Years 1999, 2001, 2002, 2003 and
2004 were approved on December 1, 1998 by Resolution No. 3267, December 19, 2000 by
Resolution No. 3377, November 6, 2001 by Resolution No. 2843 on November 5, 2002 by
Resolution No. 2509 and July 1, 2003 by Resolution No. 895,respectively; and,
WHEREAS, the Project includes the conveyance of the vacant property by the City to
HNHC located within the Fontenelle View Target Area bounded by Fowler Avenue to the north,
Ames Avenue on the south, 45th Street on the east, and 46th Street on the west, provision of a
grant for pre-development site improvements,partial financing for new construction of thirty-one
(31) single-family houses and provision of twenty-one (21) deferred payment loans to qualified
low and moderate income homebuyers whose annual household incomes are 80% and below the
Median Income by Family Size (MFI) and the remaining ten (10) houses may be available to
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purchase by any qualified buyers whose annual household incomes exceeds 80% MFI
(hereinafter referred to as the "Project"); and,
WHEREAS, this new construction Project (24 C.F.R. 570.202(a)(1) is consistent with the
Consolidated Plan as it is in the City of Omaha Neighborhood Strategy Area for North Omaha;
therefore, it is presumed to provide housing activities that benefit low and moderate income
households (24 C.F.R. 570.208(3); and, it is eligible for funding; and,
WHEREAS, HNHC is a Community Housing Development Organization (hereinafter
referred to as "CHDO") that has capacity to develop affordable housing within the City of
Omaha and has been certified by the City as meeting CHDO requirements; and,
WHEREAS, during this fifth phase of development, HNHC proposes to construct and
sell six (6) single-family houses during the term of this Amended Agreement and provide that
three (3) of the six (6) houses shall be sold to qualified homebuyers; and,
WHEREAS, HNHC plans to assist potential homeowners in obtaining mortgage
financing at an affordable rate; and
WHEREAS, the total funding from the City for the Project amounts to $1,810,000.00
comprised of$400,000.00 FY 1999, $450,000.00 FY 2001, $245,000.00 FY 2002, $100,000.00
FY 2003 and $150,000.00 FY 2004 in CDBG funds and $315,000.00 in FY 2003 HOME funds
and $150,000.00 in FY 2004 HOME funds; and,
WHEREAS, the estimated Project cost for this fifth phase of construction is estimated at
$870,000.00, comprised of $150,000.00 in CDBG funds, $150,000.00 in HOME funds, and
$570,000.00 in private and other funds; and,
WHEREAS, City funding for the fifth phase of construction shall derive from
$150,000.00 payable from the City's FY 2004 CDBG Fontenelle View Housing Development
Program, Fund No. 122186, Organization No. 129124 and $150,000.00 from the City's FY 2004
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HOME Fontenelle View Housing Development Program, Fund No. 12179, Organization No.
128058; and,
WHEREAS, a determination has been made that this Project provides or improves
housing which is determined to benefit low and moderate income persons or addresses slum and
blighted conditions on a spot basis; and,
WHEREAS, it is in the best interest of the citizens of the City of Omaha to continue the
construction of single-family dwelling units in the North Omaha community and to provide
Deferred Payment Loans for construction financing to eligible homebuyers to assist in
purchasing a newly constructed home.
NOW, THEREFORE, IN CONSIDERATION OF THESE MUTUAL COVENANTS,
the parties do hereby agree as follows:
SECTION 1. DEFINITIONS AND ABBREVIATIONS.
The following terms shall have the following meanings for all purposes in this Amended
Agreement:
1.01 "City" shall mean- the City of Omaha, a Nebraska Municipal Corporation.
1.02 "Developer" shall mean— the Holy Name Housing Corporation, a Nebraska non-
profit corporation, 3014 N. 45th Street, Omaha, Nebraska, 68104. (See Exhibit
"A"herein.)
1.03 "Director" shall mean - the Planning Director of the City of Omaha.
1.04 "Recipient" shall mean - the City of Omaha.
1.05 "Community Housing Development Organization" or "CHDO" shall mean — a
private nonprofit organization that meets a series of qualifications as prescribed in
the HOME regulations and has been certified by the City as evidenced by Exhibit
B attached herein. In this Amended Agreement, the CHDO is Holy Name
Housing Corporation, the Developer.
1.06 "HUD" shall mean -the U.S. Department of Housing and Urban Development.
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1.07 "CDBG Funds" shall mean - that portion of the Community Development Block
Grant (CDBG) funds awarded to the City of Omaha for its FY 1999, 2001, 2002
FY 2003 and 2004 Program Years, subject to and conditioned upon actual receipt
of same by the City as may be available to grant during the FY 1999, 2001, 2002
FY 2003 and 2004 program years for the use specified herein in an amount not to
exceed $1,345,000.00 (comprised of $400,000.00 FY 1999, $450,000.00 FY
2001, $245,000.00 FY 2002 $100,000.00 FY 2003 and $150,000.00 FY 2004
funds) payable from the CDBG Fontenelle View Housing Development Program,
Fund No. 122186, Organization No. 129124, subject to the terms, conditions and
requirements of said Amended Agreement.
1.07.1 "CDBG Grant" shall mean — a grant not to exceed $70,000.00 to
Developer for predevelopment and public improvement costs as
described in Exhibit C herein and applied to the development of the
first ten homes constructed and funded with FY 1999 funds.
1.08 "HOME Funds" shall mean— that portion of the HOME Investment Partnerships
Program funds awarded to the City during the FY 2004 program year in an
amount not to exceed $465,000.00, comprised of $315,000.00 in FY 2003 and
$150,000.00 in FY 2004 funds, subject to and conditioned upon actual receipt of
same by the City of Omaha, as may be available to loan for the use specified
herein. Funds shall be payable from the HOME Fontenelle Housing Development
Program, Fund No. 12179, Organization No. 128058.
1.09 "Deferred Payment Loan (DPL)" shall mean - a $1,810,000.00 loan fund derived
from CDBG and/or HOME funds without interest to Developer to finance
construction and to loan to qualified low and moderate income homebuyers in an
amount not to exceed $35,000.00 for a pre-sold property in FY 1999, FY 2001,
FY 2002, FY 2003 and FY 2004 described herein in Section 2 made subject to the
terms, conditions and provisions of the loan agreement under which said loan is
made, secured by no less than a second mortgage/deed of trust, which shall
provide, inter-alia, that same shall become due and payable without interest upon
the sale or transfer of ownership of the property, or portion thereof, by the
Developer. In the case of a speculation or model property, the DPL cannot
exceed $100,000.00 each, secured by no less than a second mortgage/deed of
trust, as described in Section 2.05 herein.
The Deferred Payment Loan will depreciate 5% to 10% per year over a period of
five (5) to ten (10) years based on the amount of the DPL with the remaining
depreciated balance due upon sale or transfer of the Property. Following the
initial depreciation, the Owner may choose to repay the DPL balance over a
period of time. Upon written request by the Owner to repay the DPL balance, the
Planning Director will determine the terms and conditions of repayment. (See
Section 1.09.2 below).
1.09.1 Maximum Deferred Payment Loans — Maximum Deferred Payment
Loans to assist homebuyers may not exceed the following:
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HOME Program
Median Income Maximum DPL Amount
80% and Below $35,000.00
Over 80% Ineligible to Purchase
CDBG Program
Median Income Maximum DPL Amount
80% and Below $35,000.00
81% - 110% $25,000.00
111% - 120% $20,000.00
Over 120% -0-
1.09.2 Recapture Provisions
Beginning after project completion, the assisted housing for the initial
homebuyer shall meet the affordability requirements for not less than the
applicable period specified in the following table:
Amount of Homeownership Minimum Period of
Assistance Per-Unit Affordability in Years
Under$15,000.00 5 Years
$15,000.00 to $40,000.00 10 Years
Over$40,000.00 15 Years
If the housing does not continue to be the principal residence of the
family for the duration of the five, ten or fifteen year Affordability
Period, or if the housing is sold during the Affordability Period, the City
of Omaha will recapture only the amount available from the net
proceeds from the sale of the assisted house.
The principal amount of the mortgage/deed of trust will depreciate
according to the following table:
Minimum Period of Term of Annual Depreciation during
Affordability in Years Depreciation Term of Depreciation
5 Years 5 Years 10%per Year
10 Years 10 Years 5%per Year
15 Years 10 Years 5%per Year
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The balance of the assistance available from the net proceeds of the
saele of the assisted house will be recaptured if the housing is sold or no
longer remains the principal residence of the household.
1.09.3 To reduce administration burden to the City, all Deferred Payment
Loans for Homebuyers shall be processed through Omaha 100 before
they can be submitted to the City for prequalification, preliminary and
final loan approval.
1.09.4 CDBG Initial House Sale Price Restriction - The maximum sales price
of any CDBG-funded house in the Project cannot exceed the Nebraska
Investment Finance Authority(NIFA) first-time homebuyer limitation in
effect at the time of loan closing to receive homebuyer assistance from
the City. Purchase agreements prior to October 30, 2001 shall be
exempt from this provision. In the Target Area, the NIFA first-time
homebuyer limitation is currently $195,000.00 on newly constructed
houses.
1.09.5 HOME Initial House Sale Price Restriction - The maximum sales price
of any HOME-funded house in the Project cannot exceed the FHA
Section 203(b) Mortgage Limits in effect at the time of loan closing.
Effective January 1, 2003, the sales price limit on single-family homes is
$160,176.00 (24 C.F.R. 9.254(a)(2)(iii).
1.10 "Construction Financing" shall mean - but is not limited to, billings for
construction, closing costs, profit and overhead, predevelopment and public
improvements costs, financing, legal, accounting, architectural, engineering, or
construction supervision costs, developer fees, developer subsidies as described in
Sections 1.10.1 and 1.10.2 herein, costs for materials, labor, utility hookups and
site preparation associated with the construction of Project.
1.10.1 The Developer, its contractors' or subcontractors' profit and overhead
shall not exceed 15%of hard construction cost.
1.10.2 "Development Subsidy Grant" shall mean — the difference between the
actual cost to develop the Property and the appraised fair market value
of the Property. The Subsidy shall be grants associated with a maximum
of twenty-seven (27) properties developed after October 30, 2001 and
shall be paid directly to the Developer in an amount not to exceed
$15,000.00 on any individual Property. Upon written request, the
Director may approve an increase in the amount of the development
subsidy grant. In no event shall the subsidy exceed the difference
between the total project cost and the appraised value.
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1.10.3 In the case of a foreclosure or upon receipt of a Deed in Lieu of
Foreclosure, Developer may buy out the first mortgage and the second
mortgage using CDBG funds. No additional CDBG or HOME funds
will be disbursed to rehabilitate the Property. After any rehabilitation of
the Property, the maximum DPL to assist the homebuyer in purchasing
the Property will not exceed the amounts identified in Section 1.09.1
herein, on a foreclosed, newly constructed property.
1.11 "Construction Completion" shall mean—the date the Project has been certified by
the City as meeting all state, federal and local laws, ordinances, regulations and
codes, including but not limited to, Section 8 Housing Quality Standards for
Existing Homes (HQS) as established by HUD, the City of Omaha Property
Rehabilitation Standards, and accessibility requirements,where applicable.
1.12 "Project Completion" shall mean-the date leveraged funds have been received by
the Developer and allocated to the Project, Construction Completion has been
certified and approved by the City, all CDBG and HOME funds have been
disbursed, and all units have been purchased by low-and-moderate income
households.
1.13 "Project Close Out" shall mean - the dates all project CDBG and HOME funds
have been disbursed and City has completed HUD close out procedures (24
C.F.R. 92.507 and OMB Circular A-110 Subpart A(g)) (Exhibit "D"). The
distinction between Project Close Out and Project Completion is that homebuyer
occupancy requirements are required to be satisfied for Project Completion. As a
result, Project Close Out shall typically occur prior to Project Completion.
1.14 "Affordability Period" (24 C.F.R. 92.252(e)) shall mean - that time period, up to
ten (10) years after Project Close Out in which Developer shall keep homes
affordable. During the Affordability Period, the Developer must ensure that
CDBG-assisted units and HOME-assisted units continue to meet occupancy
requirements and property standards as described herein. For this Amended
Agreement, the Affordability Period shall commence at loan closing with the
Homebuyer and continue until December 31, 2021. In the event Project Close Out
would be accelerated or extended, the term of the Amended Agreement and
Affordability Period would be adjusted correspondingly.
1.15 "Target Area" shall mean — that area bounded by Fowler Avenue to the north,
Ames Avenue on the south, 45th Street on the east, and 46th Street on the West.
1.16 "Property" or"Project" shall mean—the conveyance of the vacant property by the
City to HNHC located within the Fontenelle View Target Area, provision of a
grant for pre-development site improvements, partial financing for new
construction and provision of deferred payment loans to qualified low and
moderate income homebuyers.
9
1.17 "Low-and-Moderate Income Household" shall mean— a household whose annual
household income does not exceed 80% of the median income for the Omaha NE-
IA Metropolitan Statistical Area as determined by HUD (Exhibit"F").
1.18 "Client"or"Owner" shall mean - a qualified participant making application to the
Developer to purchase a newly-constructed home in the Target Area. Initial
Clients must meet income restrictions in Section 1.09.1 herein.
1.18.1 In the event a CDBG-assisted property is sold in the future, any
household may purchase the property based on a Presumption of Low-
Moderate Income.
1.19 "Presumption of Low-Moderate Income" shall mean — Households in CDBG-
assisted units in the Project are presumed to be low and moderate income since
the Project is located in the north Neighborhood Revitalization Strategy Area.
1.19.1 "North Neighborhood Revitalization Strategy Area" shall mean—
that area designated according to CPD Notice 96-01 of the CDBG
Program that requires partnerships to stimulate reinvestment in human and
economic capital and to coordinate strategies to address these needs. The
designated north Neighborhood Revitalization Strategy Area (NRSA) is
primarily a residential, economically distressed area. See Exhibit "B" for
area boundaries.
1.20 "CHDO Proceeds" shall mean — the CHDO shall be permitted to retain net
income (gross home proceeds less any construction loan financing
(CDBG/HOME funds or private)) from the sale of houses commencing July 1,
2003. CHDO Proceeds shall revolve with HNHC and continue to be used for
housing activities that benefit low-income households. The activities HNHC
proposes to use the CHCO Proceeds towards shall include pre- and post-
purchase housing counseling, renovation of substandard houses, supportive
housing services and administration and overhead. HNHC shall be permitted to
continue to retain the CHDO Proceeds after termination of this Amended
Agreement. CHDO Proceeds shall not be considered as HOME match funds.
1.20.1 CHDO Proceeds do not include the following: 1) principal and
interest payments from the homebuyer loan; and 2) funds recaptured
because the assisted homeowner does not continue to keep the house as
their principal place of residence. Income from these two sources shall be
considered Program Income and must be returned to the City as noted in
Section 1.21 below.
1.21 "Program Income" shall mean - the gross income received by the Recipient or
CHDO, exclusive of CHDO Proceeds, directly generated from the use of CDBG
and/or HOME Funds (24 C.F.R. 92.503). When such income is generated by an
activity that is only partially assisted with CDBG and/or HOME Funds, the
income shall be prorated to reflect the percentage of CDBG and/or HOME Funds
used (see Exhibit "G" attached hereto and incorporated herein by this reference as
10
though fully set forth). Any program income fund received during the term of
this Amended Agreement shall be returned to the City within thirty (30) days
prior to any additional distribution of CDBG or HOME Funds.
SECTION 2. RESPONSIBILITIES OF DEVELOPER.
2.01 Overall Project Performance. Subject to and conditioned upon actual receipt of
same, the City agrees to convey by Warranty Deed platted vacant lots in the
Target Area to Developer for the sum of One Dollar ($1.00) and other valuable
considerations. The lots conveyed shall be free of any and all encumbrances,
except those of record. The number of lots conveyed shall be sufficient in
number to enable construction of forty-one (41) single-family homes, of which
lots for six (6) homes shall be provided from FY 2004 funding sources.
In addition, the City agrees to provide funds for the fifth phase of construction
from FY 2004 including a CDBG Loan Fund not to exceed $150,000.00 and
HOME Loan Fund not to exceed $150,000.00. Total cumulative City funding for
the Project Loan CDBG and HOME funds shall not exceed $1,810,000.00.
CDBG Loan Funds for Fontenelle View Target Area shall not exceed
$1,195,000.00 of which $400,000.00 shall be payable from FY 1999, $450,000.00
shall be payable from FY 2001 and $245,000.00 shall be payable from FY 2002,
$100,000.00 shall be payable from FY 2003 and $150,000.00 from FY 2004
CDBG Program funds. Total HOME Loan Funds shall not exceed $465,000.00
(comprised of$315,000.00 FY 2003 and $150,000.00 FY 2004 FUNDS). CDBG
and HOME funding are subject to the following conditions:
2.01.1 Use of$1,740,000.00 in the form of DPLs as described in Sections 1.09
and 1.09.1 herein, plus and program income, is limited to approved
HNHC construction activities, and use of $70,000.00 in the form of a
Grant for predevelopment and public improvement costs as described in
Section 1.14 herein.
2.01.2 Loans must be made in compliance with Sections 1.09, 1.09.1, 1.09.2,
1.09.3, 2.02, and 2.03 of this Amended Agreement and the Subrecipient
Underwriting Guidelines for a City of Omaha Deferred Payment Loan,
attached hereto as Exhibit "D" and incorporated herein by this reference
as though fully set forth.
2.02 Phase Five Project Accomplishments
2.03.1 Total Total CDBG Total HOME Total Low/Moderate
Units Units Units Income Units
6 3 3 (a minimum of)
6
11
2.02.2 Number of Low/Moderate Maximum Percent of Area
Households Median Income Permitted
3 (HOME-assisted units) 80%
3 (CDBG-assisted units) 120%
2.03 Total Cumulative Project Accomplishments
2.03.1 Total Total CDBG Total HOME Total Low/Moderate
Units Units Units Income Units
31 2 10 (a minimum of)
16 + 51%
2.03.2 Number of Low/Moderate Maximum Percent of Area
Households Median Income Permitted
16 80%
2.03.3 Number Above Low/Moderate Maximum Percent of Area
Households Median Income Permitted
15 None
2.04 Speculation or Model Homes. The Developer shall be permitted to construct a
maximum of three (3) speculation(houses for which a buyers is not identified and
obligated to purchase) or model houses for the Project. The model houses shall
be built at a rate of two homes per funding year until FY 2004. In FY 2004,
Developer shall be permitted to construct four model houses. The City shall
make construction financing on model houses available to Developer without
interest, in an amount as described in Section 1.10 herein, for the cost of
constructing three (3) houses. Such loan shall be secured by no less than a second
mortgage/deed of trust and become due and payable to the City at the loan closing
as each individual house is sold.
2.04.1 Developer may construct at least one additional housing unit for each
speculation or model housing as each model house is sold, subject to the
limitations on outstanding City Construction Financing set forth in
Section 1.10 herein.
2.05 Presold Houses. In the case of pre-sold houses (houses in which a buyer has been
identified and received preliminary approval from the City), Construction
Financing shall be made available to Developer without interest in an amount not
to exceed $35,000.00 in accordance with the Subrecipient Underwriting
Guidelines (Exhibit "H"). Such loan shall be secured by no less than a second
mortgage/deed of trust and become due and payable to the City at the loan closing
as each individual house is sold. Client income verifications need to be dated no
earlier than six months prior to purchase. The Client must qualify as income
eligible at the time of loan closing with the City.
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2.05.1 Upon receipt by the City of all funds secured by each Property, the City
shall release its mortgage or provide a Deed of Reconveyance for such
Property.
2.06 Project Budget. The Developer asserts that the funding sources and amounts listed
below are committed as of the date of loan closing or will be committed to the
Project during the term of this Amended Agreement. These Project costs are an
estimation of total funding sources. Any change in the amount or sources of
funds (except for CDBG or HOME funds) shall be approved by the Director.
2.06.1 Budget for Phase Five Project Development
FY 2004 CDBG $150,000.00
FY 2004 HOME 150,000.00
Financial Institution and other private funds 570,000.00
Total Estimated Phase Four Project Costs $870,000.00
2.06.2 Budget for Total Cumulative Project. Total Project funding as of the
effective date of this Amended Agreement is estimated to be
$6,014,000.00. Funding sources from the City shall not exceed
$1,810,000.00 and is comprised of the following sources and amounts:
FY 1999 CDBG $400,000.00
FY 2001 CDBG 450,000.00
FY 2002 CDBG 245,000.00
FY 2003 CDBG 100,000.00
FY 2003 HOME 315,000.00
FY 2004 HOME 150,000.00
FY 2004 CDBG 150,000.00
Other Public Funds 170,000.00
Financial Institution and other private funds 4,134,000.00
Total Estimated Project Cost $6,014,000.00
2.07 Term of the Agreement This Amended Agreement shall be in full force and
effect and shall end on December 31, 2021 . Services of the Developer will start
effective the date of the proceed order issued by the City and Levels of Project
Performance stated in Section 2.02 herein shall be completed as of June 30, 2006.
Upon the sole discretion of the Director this date may be extended up to
December 31, 2006. In the event Project Close Out would be accelerated, the
term of the Amended Agreement and Affordability Periods may be moved
forward correspondingly.
SECTION 3. CONDITIONS FOR RECEIPT OF CITY FINANCING.
3.01 Documents Required by City. In no event shall the City assume any obligation to
make any or all of the above-referenced funding available, nor shall the City incur
any liability hereunder, unless and until the Developer has submitted for and
received the prior approval of the Director of all of the documents listed below.
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3.01.1 Property Insurance. Developer shall procure and maintain, at a minimum,
fire and extended coverage insurance in an amount sufficient to protect the
City's interest in the property during the term of the Amended Agreement
and financing security documents (OMB Circular A-110) (Exhibit "B").
The insurance policy shall include the City of Omaha as an additional
insured. Written evidence of such insurance shall be submitted to the City
for approval. In the event of damage of the property, any insurance
proceeds are to be applied, at the discretion of the Director, to the
reconstruction of the property or repayment, in full, of the funding.
3.01.2 Contracts. The Developer shall submit duly executed contracts and all
related amended contracts for all Construction Work to the Director for
approval prior to the start of construction. After Construction Work
commences, all change orders must receive prior approval by the Director
prior to the start of work related to the change orders.
3.01.3 Performance and Labor Material Payment Bond and/or an Irrevocable
Letter of Credit. Developer shall acquire and maintain performance bond
and/or letter of credit in force for one year following the completion of the
Construction Work from the Developer/General Contractor and all
subcontractors in an aggregate amount of the contract bid. The Bonds
and/or Letters of Credit shall be in favor of the City and shall be submitted
to the Director for review and approval. The Director reserves the right to
reject the Letters of Credit and Choice of Surety of the Bonds. Upon
written request by the Developer, the Director may waive this
requirement. (See Attachment 5, attached hereto and incorporated herein
as though fully set forth.).
3.01.4 Plan Submissions. Developer shall submit all plans, working drawing
and/or specifications necessary or incidental to this Project to the Director
for review and approval.
3.01.5 Evidence of Leverage/Matching Funds. Developer shall provide written
evidence that funds detailed in the Project Budget amounting to a total of
$4,304,000.00 for the Project as a whole have been committed or secured
for this Project. Matching funds are listed according to funding year
below:
FY 1999 Private Leveraged Funds $ 935,000.00
FY 2001 Private Leveraged Funds $1,305,000.00
FY 2002 Private Leveraged Funds $ 525,000.00
FY 2002 Other Public Funds $ 70,000.00
FY 2003 Private Leveraged Funds $ 799,000.00
FY 2003 Other Funds $ 100,000.00
FY 2004 Private $ 570,000.00
Total Leveraged Funds $4,304,000.00
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3.01.6 Minority/Women Owned Business Enterprise Plan. Developer shall
submit to the Director for his review and approval a minority and women
business participation plan which discusses economic development and
employment opportunities. These plans shall ensure that the Developer
and its subcontractors will make their best efforts to ensure that
construction services, contracts and employment opportunities are
affirmatively marketed to women and members of minority groups.
3.01.7 Eligible Contractors. Developer hereby certifies that it has never been
debarred or disqualified from participation in Federal programs and the
City has verified that Developer is an eligible CHDO (see Attachment 6
attached herein). In addition, Developer shall obtain a certificate from
each contractor or subcontractor to be used on this Project to the effect
that each contractor or subcontractor has not been debarred or
disqualified by HUD (24 C.F.R. Part 5). The Director shall approve all
contractors and subcontractors prior to being hired by the Developer.
3.01.8 Section 504. Not applicable. See Attachment No. 7.
3.01.9 Contractors' Insurance and Workers' Compensation. The Developer or
its contractors and subcontractors shall submit Certificates of Insurance
in favor of the City for review and approval by the Director. The
insurance coverage shall include, at a minimum, $200,000.00 bodily
injury or death, $200,000.00 property damage, $200,000.00 pollutant
liability for lead reduction work and Workers' Compensation.
3.01.10 Employment Insurance and Bonding. The Developer shall purchase a
blanket fidelity bond covering all employees, at a minimum, in an
amount equal to cash advances from the City. The Developer shall
comply with bonding and insurance requirements of OMB Circular A-
122, Bonding and Insurance.
3.01.11 Funding Compliance Deadline. In the event that all conditions of
funding are not met on or before December 31, 2005, then this Amended
Agreement shall automatically become null and void and the City shall
not be deemed to have assumed any obligation or liability hereunder.
Upon the sole discretion of the Director, this date may be extended up to
June 30, 2006.
SECTION 4. PROJECT RESPONSIBILITIES OF THE DEVELOPER.
4.01 Eligible Use of Funds. The Developer does hereby certify, contract and agree that
any and all funding obtained or made available hereunder shall be used solely and
exclusively for the purposes described herein.
4.01.1 Use Restrictions. Developer agrees that each of the housing units
developed pursuant to this Amended Agreement shall be:
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a) the principal residence of the initial Owners at the time of
purchase; and
b) subject to the repayment/recapture provisions of the DPL Deed of
Trust and Promissory Note including the terms requiring payment
in accordance with Sections 1.09.2.
4.01.2 House Initial Sales Price Restrictions. Maximum initial selling prices of
homes for the Project are as listed in Sections 1.09.3 and 1.09.4 herein.
4.02 Security for DPL. Partial mortgage or deed of trust financing to qualified low and
moderate income buyers through the use of CDBG and/or HOME Deferred
Payment Loans shall be secured by no less than a second mortgage or deed of
trust on individual properties and shall be provided in accordance with the
Subrecipient Underwriting Guidelines (Exhibit "H"). The DPL amount shall be
as summarized in Section 1.09 herein and provided in accordance with the
Deferred Payment Loan Determination Process attached hereto as Attachment 9.
Both Exhibits are attached hereto and incorporated herein by this reference as
though fully set forth.
4.03 Terms and Conditions. The Developer shall abide by all terms and conditions of
this Amended Agreement and shall be responsible for the security and
maintenance of the sites described in Section 1.14 herein.
4.04 Breach of Agreement. If through breach of this Agreement the Developer fails to
maintain the occupancy, affordability and use restrictions as described herein, all
CDBG and/or HOME funds previously provided to the Developer through
fulfillment of this Amended Agreement shall promptly be returned to the City.
4.05 Lien Waivers. Developer agrees to submit the appropriate lien waivers for each
construction payment.
4.06 Ineligible Costs. The Developer shall be responsible for payment of any Project
costs that exceed those specified in this Amended Agreement.
4.06.1 Eligible Costs. The Developer shall not request disbursement of funds
under this Amended Agreement until the funds are needed for payment
of eligible costs as described in Section 1.10 herein.
4.06.1.1 Luxury Items. Property amenities shall be those amenities
reasonably anticipated in comparable properties. Any items
determined by the City as luxury items shall not be
considered an eligible cost for construction or
reimbursement.
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4.07 Lead-Based Paint Prohibition. Developer shall not use lead-based paint in the
performance of this Amended Agreement, including the performance of any
subcontractor (42 USC 4821 et seq., 24 C.F.R. 92.355 and 24 C.F.R. Part 35).
"Lead-based Paint" means any paint containing more than six one-hundredths of
one (1) per centum of lead by weight (calculated as lead metal) in the total
nonvolatile content of the paint, or the equivalent measure of lead in the dried
film of paint already applied. The Developer further agrees to abide by Federal
requirements regarding lead-based paint poison prevention.
4.08 Ongoing Property Restrictions. During the construction period of the term of this
Amended Agreement and that of any grant, deed of trust/mortgage, covenant
documents, the Developer shall:
4.08.1 Maintain the Property in a safe and sanitary conditions at all times.
4.08.2 Ensure that all real estate taxes and special assessments are paid and
kept current.
4.08.3 Maintain insurance against loss or damage to the Property in an
aggregate amount sufficient to protect the City's interest in the Property.
Such property insurance policy must be properly endorsed showing the
City as an additional insured. In the event of loss or damage, the
Developer shall provide immediate written notification to the City of
any loss. Proceeds from any claim under this policy may, at the
discretion of the Director, be either applied to restore or replace the
improvements damaged or be paid to the City to satisfy the Developer's
obligation to the City under the terms of this Amended Agreement.
4.08.4 Ensure that the Property remains free and clear of superior liens, except
those of record at the time of loan closing with the City.
4.09 Davis-Bacon Labor Standards. Developer agrees to comply with the
requirements of the Secretary of Labor in accordance with the Davis-Bacon Acts
amended (40 U.S.C. 76a-a-7), the provisions of Contract Work Hours, the Safety
Standards Act, the Copeland "Anti-Kickback" Act (18 U.S.C. 874 and 40 U.S.C.
276 ( c ) and all other applicable federal, state and local laws and regulations
pertaining to labor standards insofar as those acts apply to the performance of this
Amended Agreement. Developer shall comply with and ensure that all bid
documents, contracts, and subcontracts contain the HUD 4010 Federal Labor
Standards provisions and applicable Department of Labor Wage Determination
("Exhibit I"), attached hereto and incorporated herein by this reference as though
fully set forth. In addition, Developer shall certify that no contractor is ineligible
for federally assisted work. The wage determination may be modified to keep it
current. All actions modifying a general wage determination apply unless notice
of such action is published less than 10 days before the contract award for the
Project. The wage determination is required to be updated in the event
construction has not commenced within ninety (90) days for the date of this
Amended Agreement. This City will send these modifications to the Developer
17
as needed. A pre-construction meeting must be held with the Developer, its
General Contractor and City Planning Department representatives prior to
commencement of construction. To obtain Project payments, the pay requests
and supporting documents must be forwarded directly to the Planning Department
Rehabilitation Inspector assigned to the Project. See Section 7.03 herein. This
shall include an Application and Certificate for Payment (AIA Document G702 or
comparable document) for entire project. This also includes pay requests that do
not require City funds.
4.10 Property Standards (24 C.F.R. 92.251). During the construction period, the
Developer shall ensure that all work performed and the Construction Work meets
all state, federal and local laws, ordinances, regulations and codes, including but
not limited to, Section 8 Housing Quality Standards for Existing Homes (HQS) as
established by HUD, the City of Omaha Property Rehabilitation Standards, and
accessibility requirements, where applicable.
4.10.1 After completion of Construction Work, the Property must comply with
all appropriate City codes and ordinances, Federal Section 8 Housing
Quality Standards and with fire safety codes (24 C.F.R. 570.02), City of
Omaha Property Rehabilitation Standards and accessibility
requirements, where applicable.
4.11 Affirmative Marketing Policy (24 C.F.R. 92.351). The Developer agrees to
comply with the City's Affirmative Marketing Policy, attached hereto as Exhibit
"J" and incorporated herein by this reference as though fully set forth. These
affirmative marketing procedures must be employed in the advertising and
marketing of this Project for the Affordability Period. Written evidence of
affirmative marketing efforts are required to be submitted to the City by the end
of the calendar year and annually thereafter for the duration of the Affordability
Period. In marketing, the Developer shall also conform to the nondiscrimination
provisions hereinafter set forth in Section 5.06.1.2.
4.12 Maintenance of Property. The Developer shall maintain the Property in a safe and
sanitary condition to the extent possible during the construction phase of the
Project.
4.13 Homebuyer First Mortgage/Deed of Trust Financing. The Developer shall assist a
first mortgage/deed of trust lender to ensure that all loans are made in compliance
with first mortgage or deed of trust lending institution's policies and underwriting
standards similar in content to the Subrecipient Underwriting Guidelines attached
hereto as Exhibit H, and incorporated herein by their reference as though fully set
forth.
4.14 Homebuyer Counseling Services. The Developer shall ensure that Clients who do
not qualify for or are refused first mortgage financing assistance through Omaha
100, Inc. are referred to Family Housing Advisory Services (FHAS) for housing
counseling services identical to that received by qualified or approved Clients in
order to qualify for homebuyer assistance from the City.
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SECTION 5. GENERAL ADMINISTRATIVE REQUIREMENTS OF DEVELOPER.
Developer agrees to comply with the following requirements:
5.01 Financial Management.
5.01.1 Accounting Standards. The Developer agrees to comply with the
Standards for Financial Management Systems (24 C.F.R. 84.21, see
Exhibit K, attached hereto and incorporated herein as though fully set
forth) and OMB Circular A-110 and agrees to adhere to the accounting
principles and procedures required therein, utilize adequate internal
controls, and maintain necessary source documentation for all costs
incurred. (Exhibit "D", attached hereto and incorporated herein as
though fully set forth).
5.01.2 Cost Principals. The Developer shall comply with the requirements and
the standards of OMB Circular No. A-122, "Cost Principles for the
Nonprofit Organizations" (Exhibit "L"), and with the requirements of
OMB Circular A-110 (Exhibit "D"). Both Exhibits are attached hereto
and incorporated herein as though fully set forth.
5.01.3 Audits. The Developer shall comply with all provisions and regulations
of the Program and have an annual audit completed in compliance with
OMB Circular A-133, attached hereto as Exhibit "M", and incorporated
herein as though fully set forth. A copy of the audit shall be provided to
the Director. The auditor shall determine the appropriate type of audit to
be conducted; i.e., limited scope or full compliance. A single audit is
not an allowable expense unless the Subrecipient expends total federal
funds over $300,000.00 in each fiscal year. A limited-scope audit may
be allowable provided the auditor conducts the audit in accordance with
generally accepted auditing standards and the recipient expends less than
$300,000.00 in each fiscal year.
5.01.3.1 Any deficiencies noted in audit reports must be fully cleared
by the Developer within 30 days after receipt of audit by the
Developer. Failure of the Developer to comply with the
above audit requirements will constitute a violation of this
Amended Agreement and may result in the withholding of
future payments and may constitute a default subject to
default remedies referenced herein in Section 9.
5.02 Documentation and Record-Keeping (24 C.F.R. 92.508). All Developer records
with respect to any matters covered in this Amended Agreement shall be made
available to the City, its designees or the Federal Government, at any time during
normal business hours, as often as the City deems necessary, to audit, examine,
and make excerpts or transcripts of all relevant data. Any contract entered into by
the Developer with any contractor or subcontractors shall include this Section to
ensure said access.
19
5.03 Reports. The Developer shall submit to the City the following reports in
accordance with 24 C.F.R. 92.505 with the submission timelines as specified.
5.03.1 Construction Progress Reports. The Developer shall provide reports to
the Director (AIA G702 Form or comparable document) describing the
progress of construction, and any significant problems and/or delays in
construction on this project. Reports will be submitted at the time of
each pay request, or by the 15th day of each month if no pay request is
made before the 15th day of the month (or upon written request from the
Director, but no more frequently than monthly). The progress reports
are required until such time as all Construction Work is completed and
the City issues the final payment of construction to the Developer.
5.03.2 Occupancy Report. The Developer shall provide to the Director an
initial occupancy report and income computation form (Exhibit N).
Reports shall include the information listed below.
5.03.2.1 name(s) of buyer(s)
5.03.2.2 address of property
5.03.2.3 household income as a percent of Median Family Income
(MFI) as determined by HUD, income verification forms
used in determining MFI including the City's Asset Form
(Exhibit"F")
5.03.2.4 household size
5.03.2.5 gender of head of household member
5.03.2.6 name and age of each household member
5.03.2.7 race/ethnicity household member
5.03.2.8 disability status of any household member
For each household or individual occupying a Property, the Developer
shall retain the occupancy records for five (5) years after the required
Affordability Period as stated in Section 1.14 herein. In the event the
Affordability Period and Term of the Amended Agreement would be
extended, the timeframe for record retention would be extended
correspondingly.
5.03.3 Presumption of Affordability. —For HOME-assisted units, the City may
presume affordability according to the acceptance of the market
analysis as described in 24 C.F.R. 92.254(a)(5)(I)(B) as evidenced by
Exhibit "0" herein in the City's annual reporting to HUD. To receive
City financing identified in Sections 1.09 and 1.09.1 herein, the Client
must be income eligible at the time of purchase.
5.04 Financial Status Reports. Developer shall submit financial status reports (OMB
Circular A-110) along with pay requests. These reports shall accompany pay
requests. In the event pay requests are not submitted for ninety (90) days,
financial status report shall be due, at a minimum, 15 calendar days from the end
of the calendar year quarter. Attached as Exhibit "P", and incorporated herein by
this reference as though fully set forth, is a sample financial status report.
20
5.05 Record Retention. The Developer, its contractors and subcontractors shall
maintain such records and accounts, including property, personnel and financial
records, as are deemed necessary by the City to assure a proper accounting for all
expenses. The Comptroller General of the United States, or any of their duly
authorized representatives, or any duly authorized representatives of the City, as
approved by the Director, shall have access to any books, documents, papers,
records and accounts of the Developer, Contractor, or subcontractors which are
directly pertinent to this Project for the purpose of making audit, examination,
excerpts and transcriptions. Such records and accounts shall be retained for five
(5) years after expiration of the Affordability Period or until December 31, 2023
for this Amended Agreement. (OMB Circular A-110) (Exhibit "D"). In the event
the Affordability Period and Term of the Amended Agreement would be
extended, the timeframe for record retention would be extended correspondingly.
5.06 Personnel and Participant Conditions.
5.06.1 Contract Compliance Clause.
5.06.1.1 Section 10-192 of the Omaha Municipal Code, Equal
Employment Opportunity Clause. The Developer and its
contractors or subcontractors shall not discriminate against
any employee or applicant for employment because of race,
religion, color, sex, age, national origin, familial or handicap
status. As used herein, the word "treated" shall mean and
include, without limitation, the following: recruited, whether
by advertising or by other means; compensated; selected for
training, including apprenticeship; promoted; upgraded;
demoted; downgraded; transferred; laid off; and terminated.
The Developer and its contractor agree to and shall post in
conspicuous places, available to employees and applicants
for employment, notices to be provided by the contracting
officers setting forth the provisions of this nondiscrimination
clause.
5.06.1.2 The Developer and its contractors or subcontractors shall, in
all solicitations or advertisements for employees placed by or
on behalf of the contractor, state that all qualified applicants
will receive consideration for employment without regard to
race, religion, color, sex, age, national origin, familial or
handicap status.
5.06.1.3 The Developer and its contractors or subcontractors shall
send to each representative of workers with which he has a
collective bargaining agreement or other contract or
understanding a notice advising the labor union or workers'
representative of the contractor's commitments under the
equal employment opportunity clause of the city and shall
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post copies of the notice in conspicuous places available to
employees and applicants for employment.
5.06.1.4 The Developer and its contractors or subcontractors shall
furnish to the Human Relations Director all federal forms
containing the information and reports required by the federal
government for federal contracts under federal rules and
regulations, including the information required by sections
10-192 to 10-194, inclusive, of the Omaha Municipal Code
and shall permit reasonable access to his records. Records
accessible to the Human Relations Director shall be those
which related to paragraphs 5.06.1.1 through 5.06.1.7 of this
subsection and only after reasonable notice is given the
contractor. The purpose of this provision is to provide for
investigation to ascertain compliance with the program
provided herein.
5.06.1.5 The Developer and its contractors or subcontractors shall
take such actions with respect to any subcontractor as the
City may direct as a means of enforcing the provisions of
paragraphs 5.06.1.1 through 5.06.1.7 herein, including
penalties and sanctions for noncompliance; however, in the
event the contractor becomes involved in or is threatened
with litigation as the result of such directions by the City, the
City will enter into such litigation as is necessary to protect
the interests of the City and to effectuate the provisions of
this division, and, in the case of contracts receiving federal
assistance, the contractor or the City may request the United
States to enter into such litigation to protect the interests of
the United States.
5.06.1.6 The Developer and its contractors shall file and shall cause
his subcontractors, if any, to file compliance reports with the
Developer's contractor in the same form and to the extent as
required by the federal government for federal contracts
under federal rules and regulations. Such compliance reports
shall be filed with the City's Human Relations Director.
Compliance reports filed at such times as directed shall
contain information as to the employment practices, policies,
programs and statistics of the Developer, contractor and his
subcontractors.
5.06.1.7 The Developer and its contractors or subcontractors shall
include the provisions of paragraphs 5.06.1.1 through
5.06.1.7 of this section, "Equal Employment Opportunity
Clause," and Section 10-193 in every contract, subcontract or
purchase order so that such provisions will be binding upon
22
each subcontractor or vendor. (Code 1980, Section 10-192;
Ordinance No. 35344, Sections 1, 9-26-00).
5.06.2 Workers' Compensation. The Developer shall provide Workers'
Compensation Insurance coverage for all employees involved in the
performance in this Amended Agreement.
5.06.3 Section 3 - Employment of Low-Income Persons (Section 3 of HUD Act
of 68, as amended, 1 U.S.C. 1701u). The Developer shall make its best
efforts to comply with Section 3. The purpose of Section 3 is to ensure
that employment and other economic opportunities generated by HUD
assistance or HUD-assisted projects covered by Section 3 shall, to the
greatest extent feasible,be directed to low and very low-income persons,
particularly persons who are recipients of HUD assistance for housing.
5.06.4 Conflict of Interest. The Developer agrees to abide by the provisions of
24 C.F.R. 92.356 with respect to conflicts of interest, and covenants that
it presently has financial interest and shall not acquire any financial
interest, direct or indirect, which would conflict in any manner or degree
with the performance of services required under this Amended
Agreement. The Developer further covenants that in the performance of
this Agreement no person having such a financial interest shall be
employed or retained by the Developer hereunder. These conflict of
interest provisions apply to any person who is an employee, agent,
consultant, officer or elected official or appointed official of the City or
any designated public agencies or subrecipients which are receiving
funds under the entitlement program.
5.06.5 Protected and Disadvantaged Business Enterprise Programs. (Omaha
Municipal Code, Section 10-200). The Developer shall make every
good faith effort to procure services or supplies with protected and
disadvantaged business enterprises as defined in Exhibit"Q"herein.
SECTION 6. DEVELOPER'S COMPLIANCE WITH OTHER FEDERAL REGULATIONS.
6.01. Environmental Review. The Developer agrees to comply with the following
regulations insofar as they apply to the performance of this Amended Agreement:
6.01.1 Clean Air Act, 42,.U.S.C., 1857, et seq.
6.01.2 Federal Water Pollution Control Act, as amended, 33 U.S.C. 1251, et
seq., as amended 1318 relating to inspection, monitoring entry, reports
and information as well as other requirements specified in Section 114
and Section 308, and all regulations and guidelines issued thereunder.
6.01.3 Environmental Protection Agency (EPA) regulations pursuant to 40
C.F.R. Part 50, as amended.
23
6.01.4 National Environmental Policy Act of 1969.
6.01.5 HUD Environmental Review Procedures (24 C.F.R. Part 58).
6.01.6 Flood Disaster Protection Act of 1973 (24 U.S.C. 4106 and P.L. 2234) in
regard to the sale, lease or other transfer of land acquired, cleared or
improved under the terms of the Amended Agreement as it may apply to
provisions of this Amended Agreement.
6.01.7 Historic Preservation requirements set forth in the National Historic
Preservation Act of 1966, as amended (16 U.S.C. 470) and the
procedures set forth in 36 C.F.R., Part 800, Advisory Council on
Historic Preservation Procedures for Protection of Historic Properties,
insofar as they apply to the performance of this Amended Agreement.
In general, this requires concurrence from the State Historic Preservation
Office for all rehabilitation and demolition of historic properties that are
45 years old or older or that are included on a Federal, State or local
historic property list.
6.02 Uniform Relocation Act. The Developer shall comply with the applicable
regulations of the Uniform Relocation Act of 1970, as amended (URA) (42
U.S.C. 4601-4655), or Section 104 (d) of the Housing and Community
Development Act of 1974, as amended (Section 104 (d)), which require relocation
assistance be provided to resident owners, tenants,businesses and other occupants
that are displaced as a result of a federally-assisted project. In the event that the
Developer or its agent displaces any tenant-occupant of the property, it shall
immediately notify the City in writing of the circumstances surrounding said
displacement and comply with 24 C.F.R. 92.353.
6.03 Soil Work Policy. Developer and its contractors and subcontractors shall comply
with the City of Omaha Soil Work Policy, if applicable, see Exhibit "R", attached
hereto and incorporated herein as though fully set forth.
SECTION 7. RESPONSIBILITIES OF THE CITY.
7.01 Performance Monitoring. The City will monitor the performance standards of the
Developer as stated herein. Substandard performance as determined by the City
will constitute non-compliance with this Amended Agreement. If action to
correct such substandard performance is not taken by the Developer within a
reasonable period of time after being notified by the City, contract suspension or
termination procedures may be initiated.
7.02 Payments. It is expressly agreed and understood that the total amount to be paid
by the City under this Amended Agreement shall not exceed $1,195,000.00 in
CDBG funds and $315,000.00 in HOME funds. The payment of these funds is
subject to and conditioned upon actual receipt by the City of the same. Should
adequate funding not be available to the City, the City shall notify the Developer
as soon as reasonably possible and the Amended Agreement will be terminated.
24
7.02.1 Funds Allocated to the Developer. Funds allocated to the Developer
shall be in the form of a Repayable Loan for the CDBG and HOME
funds and a Deferred Payment Loans and such funds shall be used for
the purposes set forth in this Amended Agreement. Payments will be
contingent on Duties and Conditions specified herein. Drawdowns for
the payment of eligible expenses shall not be made until the funds are
needed based upon the value of the construction, administration, or
professional services work completed at the time the payment request is
made.
7.02.2 Obligation for Payment. In no event shall the City become obligated to
make any payments for any work performed, materials furnished,
expense incurred, or any other expenditure of any kind whatsoever,
unless same is expressly included in this Amended Agreement, nor shall
the City incur any liability hereunder, unless and until the Developer has
timely and fully complied with its duties and obligations hereunder. No
payments shall be made for any work, labor, material or expenses
incurred the Director deems to be:
7.02.2.1 Not in conformance with applicable state, federal and/or local
laws, including but not limited to, the building, plumbing
and/or electrical codes; or,
7.02.2.2 Not in conformance with all plans, working drawings and/or
specifications as approved.
7.02.2.3 Unacceptable or substandard; or,
7.02.2.4 Not in accordance with this Amended Agreement or related
contracts as approved for this Project.
7.03 Progress Payments. After receipt of compliance of the Developer with the
Contract Compliance Ordinance from the Human Relations Director, progress
payments and final payment, as may be authorized by the Director or his
designated representative, are subject to:
7.03.1 Receipt, verification and approval of an AIA Document G702
"Application and Certificate for Payment" or comparable document,
such document being prepared by the Developer's architect or
authorized person and approved by the Developer and the City
rehabilitation specialist before being submitted to the Planning
Department for payment. All documents for each pay request
submission must be forwarded directly to the Planning Department
Rehabilitation Inspector assigned to the Project. This shall include all
Application and Certificate for Payment (AIA Document G702 or
comparable document) for the entire Project. This also includes pay
requests that do not require City funds.
25
7.03.2 Receipt of requisite financial status reports.
7.03.3 A 10% retainage of HOME and CDBG funds shall be held by the City
until all punch list items have been corrected to the satisfaction of the
Developer and the City rehabilitation specialist assigned to this project.
7.04 Inspections. The City may perform periodic inspections at any reasonable time to
ensure compliance with this Amended Agreement. The City shall perform final
inspection to certify Project completion prior to final disbursement of CDBG, or
HOME. In addition, the City shall perform on site inspections of Property every
one to three years from project completion to ensure compliance with property
standards (24 C.F.R. 92.504 (c)(4)(d)).
7.05 Technical Assistance. The Director shall assist the Developer in the same manner
the Director provides technical assistance to other developers during the
construction phase to ensure compliance with such housing quality standards and
property rehabilitation standards.
SECTION 8. MUTUAL AGREEMENTS BETWEEN CITY AND DEVELOPER.
8.01 Release of Information Laws. The Developer specifically hereby states, agrees
and certifies that it is familiar with the limited purpose set forth in the Federal
Laws, Rules and Regulations, and in the laws of the State of Nebraska, for which
personal information requested may be used and that the information received
will be used solely for those limited purposes and not to harass, degrade or
humiliate any person. The information released shall be used for the limited
purposes stated, and the Developer further agrees to indemnify and hold harmless
the City of Omaha for any liability arising out the improper use by the Developer
of information provided.
8.02 Applicable Laws. Parties to this Amended Agreement shall conform with all
existing and applicable City ordinances, resolutions, state laws, federal laws, and
all existing and applicable rules and regulations. Nebraska law will govern the
term and the performance under this Amended Agreement.
8.03 Interest of the City. Pursuant to Section 8.05 of the Home Rule Charter, no
elected official or any officer or employee of the City shall have a financial
interest, direct or indirect, in any City agreement. Any violation of this section
with the knowledge of the person or corporation contracting with the City shall
render the Agreement voidable by the Mayor or Council.
8.04 Independent Contractor. Nothing contained in this Amended Agreement is
intended to, or shall be construed in any manner, as creating or establishing the
relationship of employer/employee between the parties. The Developer shall at
all times remain an independent contractor with respect to the services to be
performed under this Amended Agreement. The City shall be exempt from
payment of all Unemployment Compensation, FICA, retirement, life and/or
26
medical insurance and Worker's Compensation Insurance as the Developer is an
Independent Contractor.
8.05. Project Roles. The Developer shall ensure that the Project meets the objectives
stated herein. The City has selected the Developer to assist in the Project since it
is consistent with the Consolidated Plan. With respect to this Project, the City is
not acting as the Developer's architect or engineer. The City makes no
warranties, express or implied, as to the Construction Work. The City owes no
duty to the Developer or any other persons that shall arise because of any
inspection of the premises by the City's agents or employees.
8.06 Captions. Captions used in this Amended Agreement are for convenience and are
not used in the construction of this Amended Agreement.
8.07 Merger. This Amended Agreement shall not be merged into any other oral or
written agreement, lease or deed of any type.
8.08 Modification. This Amended Agreement and any related documents securing the
financing contain the entire agreement of the parties. No representations were
made or relied upon by either party other than those that are expressly set forth
herein. No agent, employee, or other representative of either party is empowered
to alter any of the terms herein unless done in writing and signed by an authorized
officer of the respective parties, pursuant to Section 10-142 of the Omaha
Municipal Code.
8.09 Assignment. The Developer may not assign its rights or obligations under this
Amended Agreement without the express prior written consent of the City; except
that the Mayor may, without City Council approval, approve, in writing, the
assignment to a limited partnership so long as the Developer is and remains a
general partner or to a limited liability company so long as the Developer is and
remains as the managing member.
8.10 Strict Compliance. All provisions of this Amended Agreement and each and
every document that shall be attached shall be strictly complied with as written,
and no substitution or change shall be made upon written direction from
authorized representatives of the parties.
8.11 Termination. This Amended Agreement may be suspended or terminated in
accordance with 24 C.F.R. 85.43, Enforcement or C.F.R. 85.44, Termination for
Convenience (Exhibit "S", attached hereto and incorporated herein by this
reference as though fully set forth). Upon termination of this Amended
Agreement, all funds and interest in any account hereunder shall become the
property of the City and shall be returned to the City.
8.12 Reversion of Assets - CDBG Funds. Upon the expiration of this Amended
Agreement, the Developer shall transfer to the City of Omaha any CDBG funds
on hand at the time of expiration and any accounts receivable attributable to the
use CDBG funds (24 C.F.R. 570.503(b)(8)). Additionally, the Developer shall
27
ensure that any real property under the Developer's control that was acquired or
improved in whole or in part with CDBG funds in excess of$25,000.00 is either:
8.12.1 Used to meet on the national objectives in 24 C.F.R. 570.208 until five (5)
years after expiration of the Amended Agreement, or such longer period of
time as determined appropriate by the City; or,
8.12.2 Is disposed of in a manner which results in the City being reimbursed in
the amount of the current fair market value of the property less any portion
thereof attributable to expenditures of non-CDBG funds for acquisition of,
or improvement to, the property. Such reimbursement is not required after
the period of time specified in accordance with Section 8.12.1 above.
8.13 Reversion of Assets - HOME Funds. Upon the expiration of this Amended
Agreement, the Developer shall transfer to the City of Omaha any CDBG funds
on hand at the time of expiration and any accounts receivable attributable to the
use HOME funds (24 C.F.R. 92.504 (c)(2)(vii)).
8.14 Indemnification. The Developer shall indemnify and hold the City harmless from
and against: (1) any and all claims arising from contracts between the Developer
and third parties made to effectuate the purposes of this Amended Agreement;
and, (2) any and all claims, liabilities or damages arising from the preparation or
presentation of any of the work covered by this Amended Agreement.
8.15 Unenforceable Provisions. Any provision of this Amended Agreement, which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be in
effect to the extent of such prohibition or enforceability without invalidating the
remaining provisions hereof or affecting the validity or enforceability of such
provision in any other jurisdiction.
8.16 Disclosure of Lobbying. The Developer shall certify and disclose, to the best of
its knowledge and belief, that:
8.16.1 No Federal appropriated funds have been paid or will be paid, by or on
behalf of the Developer, to any person for influencing or attempting to
influence an officer or employee of Congress, or an employee of a
Member of Congress in connection with the awarding of any Federal
contract, the making of any Federal grant, the making of any Federal
loan, the entering into of any cooperative agreement, and the extension,
continuation, renewal, amendment or modification of any Federal
contract, grant, loan, or cooperative agreement.
8.16.2 If any funds other than Federal appropriated funds have been paid or
will be paid to any person for influencing or attempting to influence an
officer or employee of any agency, a Member of Congress, an officer of
employee of Congress, or an employee of a Member of Congress in
connection with this Federal contract, grant, loan, or cooperative
agreement, the Developer shall complete and submit standard Form-
28
LLL, "Disclosure Form to Report Lobbying", in accordance with its
instructions.
8.16.3 The language of this certification be included in the award documents
for all subawards at all tiers, (including subcontracts, subgrants, and
contracts under grants, loans, and cooperative agreements) and that all
subrecipients shall certify and disclose accordingly.
8.17 Notices. The City and the Developer hereby expressly agree that for purposes of
notice, including legal service or process, during the term of this Amended
Agreement, and for the period of any applicable statute of limitations thereafter,
the following named individuals shall be authorized representatives of the parties:
1) City:
City of Omaha
Planning Department
1819 Farnam Street, Room 1111-0110
Omaha,Nebraska 68183
2) Developer:
Holy Name Housing Corporation
Sister Marilyn Ross, Executive Director
3014 N. 45th St.
Omaha,Nebraska 68104
In the event the authorized representative changes during the term of this
Amended Agreement, prior written notice will be given to the respective party at
the address noted above.
8.18 Applicability. This Amended Agreement shall be binding upon the parties hereto
and shall run with the Property.
SECTION 9. DEFAULT PROVISIONS.
9.01 Remedies. If, through any cause, the Developer shall fail to fulfill in a timely and
proper manner any obligations under this Amended Agreement, or violate any of
the covenants, representations or agreements hereof, the City may upon written
notice terminate this Amended Agreement or such parts thereof as to this
Amended Agreement, and may hold the Developer liable for any damages caused
to the City by reasons of such default and termination.
•
29
IN WITNESS WHEREOF, the parties have executed this Amended Agreement as of the
date indicated bel.ow�
ATTEST; CITY OF OMAHA:
/ V Val
CI = LERK OF THE CITY OF OMAHA MAYOR OF THE CITY O OMAHA
/*/
Date Date
HOLY NAME HOUSING CORPORATION, a
Nebraska Non-Profit Company:
WI NE S:
By: �rf. 4,-, l��
Sr. Marilyn Rossaxecutive Director Date
a /
Date
APPR AS TO FORM:
,/e7//#
SSI ANT CIT ATTORNEY D to
P:\PLN2\2664sap.doc
30
SCHEDULE OF EXHIBITS
Agreement
Exhibit Location Description
A 1.02 Articles of Incorporation, Bylaws, Corporate
Resolution for Holy Name Housing Corporation
B 1.05 CHDO Certification
C 1.07.1 Project Pre-Development and Public
Improvement Cost Estimate
D 1.13 OMB Circular A-110
E 1.19.1 North Neighborhood Revitalization Strategy
Area
F Median Family Income Chart and Asset
Computation Form
G 1.21 Definition—Program Income
H 2.05, 4.02, 4.13 Subrecipient Underwriting Guidelines
I 4.09 Davis Bacon Wage Decision and HUD 4010
J 4.11 Affirmative Marketing Policy
K 5.01.1 Standards for Financial Management Systems
(24 C.F.R. 84.21)
L 3.01.10, 5.01.2 OMB Circular A-122
M 5.01.3 OMB Circular A-133
N 5.03.2 Occupancy Report
0 5.03.3 Market Analysis Acceptance of HOME
Presumption of Affordability
P 5.04 Financial Status Reports
Q 5.06.5 Protected and Disadvantage Business Enterprise
Programs (Omaha Municipal Code, Section 10-
200)
R . 6.03 City Soil Work Policy
S 8.11 Termination- 24 C.F.R. 85.43 - 85.44
31
ATTACHMENTS
1 City of Omaha Definition of Income
2 Equal Opportunity
3 Section 3 Clause
4 Minority and Women Business Plan
5 Approved Waiver of Bond
6 HNHC—Eligible Contractor/Developer
7 Section 504 Exemption
8 Subsidy Layering
9 Deferred Payment Loan Determination Process
P:\PLN2\2664sap.doc
32
Exhibit A
CORPORATE RESOLUTION
I, Fr. James Keena, do hereby certify that I am the duly elected President of Holy Name
Housing Corporation, a Nebraska 501(c)(3) nonprofit corporation authorized to do business in
the State of Nebraska, and that the following is a Resolution adopted at a meeting of the Board
of Directors of said corporation, held on the 1st day of December, 2004.
WHEREAS, Holy Name Housing Corporation is committed to the development of
residential units to provide affordable residential units to qualified low and moderate income
families; and
WHEREAS,the Corporation and the City of Omaha have negotiated an Agreement for
the construction of three residential units; and
NOW, THEREFORE, BE IT RESOLVED that the Corporation does hereby agree to
enter into an Agreement with the City of Omaha for the construction of six units for qualified
low and moderate income families in the designated Fontenelle View taret area; an area
bounded by Ames Avenue on the south, Fowler Avenue on the north, 45 ' Street on the east and
46th Street on the west; and
IT IS FURTHER RESOLVED that Sr. Marilyn Ross, Executive Director of the
Corporation, Thomas Vaughan,Housing Coordinator of the Corporation and Lisa Burks,
Administrative Assistant of the Corporation be, and hereby are, authorized to take all such
actions, including the execution of an Agreement and any security documents in favor of the
City of Omaha to carry out the purpose of this Resolution.
I do hereby further certify that since the adoption of said Resolution, it has been neither
revoked nor amended; and
I do hereby further certify that on October 1, 2003, Reverend John Kuehner was elected
Secretary/Treasurer and on October 1, 2003, Br. William Cloughley was elected Vice President
and that they have been since that date and are now, respectively, Secretary/Treasurer and Vice
President of Holy Name Housing Corporation.
Witness my hand and the seal of Holy Name Housing Corporation this 2nd day of
December, 2004.
President
•
• ARTICLES OF INCORPORATION •
OF Exhibit A •
•
HOLY NAME HOUSING CORPORATION •
•
•
•
•
•
Pursuant to the provisions of the Nebraska Nonprofit
Corporation Act, the undersigned natural persons of the age of
eighteen years or more, acting as incorporators, do. h reby set
forth:
.
ARTICLE I
•
Name •
•
• The name of the corporation is Holy Name Housing
Corporation..
•
ARTICLE II MARI" () '.� 1927
STATE C:7 NEEI:.ASKh S5
Duration SECIZET.•''RY'S 0F1 ICL•
•
Film,'andrecc4dcd c:r� Ca roll
The corporation shall have perpetual exis . Page•
e ,;9. &i1,4,4X
ARTICLE III
BY (• f f• ) SOcretuy at au
�i /
•
The corporation is organized and shall be operated
exclusively as a nonprofit corporation for the following pur-
poses:
•
( 1 ) To promote and encourage the rehabilitation and
maintenance of substandard housing in economically
depressed areas of the City of Omaha;
(2 ) To actively engage in the rehabilitation and
maintenance of substandard housing in economically
depressed areas of the City of Omaha;
•
(3 ) To' participate in activities and other programs
of public interest which relate to the establishment
and maintenance of desirable housing and neighborhood
rehabilitation and preservation; and
(4 ) Such other charitable, benevolent, eleemosynary,
• educational, civic, religious and social activities • as
may be deemed appropriate by the Board of Directors . •
The corporation shall have the power to hold property of ally
nature in trust for itself or for the carrying out of any of its
authorized purposes . In furtherance of its foregoing purposes ,
. the corporation shall have all the powers given to and possessed
by a corporation under the Nebraska Nonprofit Corporation Act
Lhat are not inconsistent with such purposes , subject. always ,
however, to the.,limitation that, notwithstanding any other
_. provision of .these Articles, only such powers shall be exercised
, " as may be exercised • by an organization exempt under Section
501(c) (3 ) of the Internal Revenue Code and its regulations as .
they now exist or as they may hereafter be 'amended. •
ARTICLE IV '
Registered Office and Re istered Agent •
• The address of the corporation' s registered office is
3014 North 45th Street, Omaha, Nebraska 68104, and the name of
.its registered agent at such office is Rev. Gerald Mullin, C.S .s .R.
ARTICLE V
Management of Affairs
•
• The affairs of the corporation shall be managed in
accordance with the By-laws by a Board of Directors . The method
of selection, the number of directors and' the duration of their
•
terms shall be as provided in the By-laws, provided that the
number of directors shall not be less than three (3 ) . The
directors constituting the first Board of Directors are as •
follows :
I. Rev. Gerald Mullin, C. S . s.R.
3014 North 45th Street •
Omaha, Nebraska 68104 •
•
2. Rev. Donald Neureuther, C.S . s .R.
3024 North 45th Street •
•
Omaha, Nebraska 68104
3 . Edward Vaughan
2711 North 48th Avenue
Omaha, Nebraska 68104
• ARTICLE VI
By-laws
The By-laws of the corporation shall be adopted by the
Directors . at any regular meeting or at any special meeting
called for that purpose so long as they are not inconsistent
with the provisions of these Articles . The By-laws may be
amended by the Board of Directors in the manner provided in the
By-laws .
•
ARTICLE VII
• Membership : Capital Stock
The corporation shall have no members and the corpoi1-
tion shall not have nor shall it issue any shares of stock Ln
any form or denomination.
•
•
•
•
•
•
ARTICLE VIII •
Amendments •
The corporation reserves the right to amend, alter or
repeal any provision contained in these Articles of Incorporation
in the manner now or hereinafter prescribed or permitted by law .
•
ARTICLE IX'
Liability of Members , Board of Directors , Officers , etc .
The private property of the incorporators and Directors
of the corporation shall not be subject to the debts or obliga-
tions of the corporation to any extent whatsoever.
ARTICLE X
Prohibitions ; Dissolution •
This corporation is organized exclusively for chari-
table, religious , educational, and scientific purposes , includ-
ing, for such purposes , the making of distributions to organiza-
tions that qualify as exempt organizations under Section 501 (c) ( 3 )
of the Internal Revenue Code of 1954 (or the corresponding
provision of any future United States Internal Revenue Law ) . No
part of the net earnings of the corporation - shall inure to the
benefit of, or be distributable to its Directors , officers , or
other private persons, except that the 'corporation shall be
authorized and .empowered to pay reasonable compensation for
services rendered and to make payments and distributions in
furtherance of the purposes set forth in the preceding sentence
hereof. No substantial part of the activities of the corpora-
tion shall be the carrying on of propaganda, or otherwise
attempting to influence legislation, and the corporation shall
not participate in, or intervene in ( including the publishing or
distribution of . statements ) any political campaign on behalf of
any candidate for public office. Notwithstanding any other
provision of these Articles , 'the corporation shall not carry on
activities not permitted to be. carried on ( a) by a corporation
exempt from Federal. . Income Tax under Section 501(c) (3 ) of the
Internal Revenue Code of 1954 (or the• corresponding provision of
any future United States Internal Revenue Law) or (b ) by a
corporation, contributions to which are deductible under Section
170 (c) (2 ) of the Internal Revenue Code of 1954 (or the correspond-
ing provisions of any future United States Internal Revenue
Law ) .
Notwithstanding anything herein to the contrary upon
the dissolution of the corporation, the Board of Directors
shall , after paying or making provision for the payment of• ail
of the liabilities of the corporation, dispose of all of the
assets of the corporation in such manner, or to such organizo-
•
•
•
tion or organizations organized and operated. exclusiveiy for
charitable . educational , religious or scientific purposes as
shall at the time qualify as an exempt organization or organize
ti ons under section 501 ( c ) ( 3 ) of the Internal Revenue •Code of
1954 (or the corresponding provision of any future United States
Internal Revenue Law.) , as the Board of Directors- shall deter-
mine . Any such assets not so disposed of shall be disposed o
by the District Court of the county in which the principal
officeof the corporation is then located, exclusively for sucn
purposes or to such organizations , - as said Court shall deter-
mine , which are organized and operated exclusively for such
purposes .
ARTICLE XI.
The name and street address of each incorporator is as
follows :
Rev . Gerald I'Iullin , C. S . s . R.
• 3014 North 45th Street
Omaha , Nebraska 66104 •
Rev. Donald ' Neureuther, C. S . s . R.
3014 North 45th S`_`_t
Omaha, Nebraska 68104 •
DATED this 3rd day of March, 1982 .
•
1.4l/�€�� l'/ Ct '(�41
Incorporatori1 t
kill:1M('c�_1 l j•
U,•V,�t�#'�;1� C. �. S. .
Incorporator
i
Exhibit A
RESTATED
BY-LAWS
HOLY NAME HOUSING CORPORATION
ARTICLE I CORPORATE AFFAIRS
1. 1 The affairs of the corporation shall be conducted
strictly in accordance with and furtherance of the
Corporation's charitable and educational purposes as set
forth in the Articles of Incorporation, and all
provisions of these By-Laws shall be construed in a
manner consistent with the furtherance of such purposes.
ARTICLE II BOARD OF DIRECTORS
2 . 1 Purposes and Duties. The purpose of the Board of
Directors is to assure that the philosophy and mission of
Holy Name Housing Corporation is in agreement with the
philosophy and mission of the Redemptorist Fathers, St.
Louis Province, Inc.
The duties of the Board of Directors shall be:
a. to appoint or remove the Executive Director;
b. to approve any amendment of . the Articles of
Incorporation or By-laws of the corporation;
c. to review and approve the annual operating budget
of the corporation;
d. to approve any dissolution, consolidation, or
merger of the Corporation and to approve the
incorporation of affiliated corporations of this '
Corporation.
2 . 2 Membership. The members of the Board of Directors shall,
at all times, be the three (3). persons who hold the
offices of Rector and Consultors of the Redemptorist
Fathers of Nebraska. When any Redemptorist shall cease
to be the Rector or Consultor of the Redemptorist Fathers
of Nebraska, he shall cease to be a director of this
Corporation, automatically and without any affirmative
action on the part of the Corporation, and his
replacement as Rector or Consultor of the Redemptorist
Fathers of Nebraska shall automatically become a director
• of this corporation.
2 . 3 Compensation. Directors shall serve without
compensation.
2 . 4 Officers and Duties. The Rector of the Redemptorist
Fathers of Nebraska shall serve as the President of the
Board of Directors and shall appoint one Consultor to
serve as Vice President and one Consultor to serve as
Secretary/Treasurer.
2 . 5 Meetings. Regular meetings of the Board of Directors
shall be held annually on or before- March 15th of each
year. Special meetings shall be called from time to time
when requested by two (2) directors.
2 . 6 Notice. Reasonable notice of all Directors ' meetings
shall be given. A majority of Directors present shall
constitute a quorum for the transaction of business.
ARTICLE III BOARD OF ADVISORS
3 . 1 Purpose and Duties. The purpose of the Board of Advisors
is to assure that the mission, philosophy, goals and
purpose of Holy Name Housing Corporation are preserved.
The duties of the Board of Advisors shall be:
a. to participate, in an advisory capacity, in the
ongoing long range and shortterm planning process
of Holy Name Housing Corporation;
b. to make recommendations, in an advisory capacity,
to the Board of Directors and Executive Director
regarding organizational development, fund-raising,
financial management, and relationships with other ,
agencies, institutions and individuals;
c. to make recommendations, in an advisory capacity,
to the Board of Directors and Executive Director
regarding provision, maintenance and expansion of
housing services;
d. to recommend to the Board of Directors an annual
operating budget;
e. to participate when appropriate with the Board of
Directors in the recruitment, selection and annual
evaluation of the Executive Director.
3 . 2 Membership. Membership of the Board of Advisors shall be
comprised of the Executive Director of Holy Name Housing
Corporation and such other persons as the Executive
Director appoints, including, by way of example only,
residents of the Holy Name neighborhood, representatives
of organizations which fund Holy Name Housing
Corporation, representatives of the professional and
business sector of this community, and representatives of
community organizations.
3 . 3 Compensation. Advisors shall serve without compensation.
3 . 4 Terms. Members of the Board of Advisors shall serve
three year terms and may serve consecutive terms for such
time as the Executive Director specifies.
3 .5 Officers and Duties. Such officers as the Executive
Director determines are necessary shall be elected by the
Holy Name Housing Corporation Board of Advisors from time
to time and shall perform such duties and have such
responsibilities as the Executive Director shall
determine.
3 . 6 Meetings. Regular meetings of the Board of Advisors
shall be held during the first week of the months of
March, June, September and December. Special meetings
shall be called from time to time when requested by three
(3) Advisors.
3 . 7 Notice. Reasonable notice of all Advisors ' meetings
shall be given.
3 . 8 Committees. The Executive Director may appoint an
Executive, Finance, Personnel, and Project Committee of
the Board of Advisors and any other committee the
Executive Director deems necessary.
ARTICLE IV EXECUTIVE DIRECTOR
4. 1 Appointment. The Executive Director .shall be appointed
by, accountable to, and shall serve at the will of the
Board of Directors.
4. 2 Duties. The duties of the Executive Director of Holy
Name Housing Corporation are:
a. to direct the activities of Holy Name Housing
Corporation in accordance with the Corporation' s
Articles of Incorporation and Bylaws;
b. to provide leadership in the governance and
management of Holy Name Housing Corporation;
c. to achieve the objectives and discharge the
responsibilities established by the Board of
Directors and specified in the Holy Name Housing
Corporation "Position Description" for the
Executive Director.
d. to plan, direct, control and evaluate all day-to-
day corporate activities.
4 .3 Compensation. The compensation of the Executive Director
shall be established by the Board of Directors at the
Board' s annual meeting.
ARTICLE V CORPORATE SEAL
5 . 1 The Corporation shall not have a corporate seal .
ARTICLE VI FISCAL YEAR
6. 1 The fiscal year of the Corporation shall commence on the
first day of April and end on the thirty-first day of
March.
ARTICLE VII AMENDMENTS
7 . 1 These By-laws may be repealed, altered or amended by
majority vote of the Board of Directors at any regular
meeting or any special meeting held for that purpose.
The undersigned hereby certify that the foregoing By-laws
were duly adopted by the Board of Directors effective
September 1, 1993 .
Rev. B ian Jo s ,. C.SS.R.
4tzi,,A_
Rev. Robert Oelerich
Rev. Stephen Benden, C.SS.R.
HOLY NAME HOUSING CORPORATION
BOARD OF DIRECTORS Exhibit A
Date: 12/1//2004
President: Rev. James Keena, Pastor
Holy Name Church
3014 N. 45th Street
Omaha, NE 68104
Vice President: * Brother William Cloughley
(Same as above)
Sec/Treasurer * Rev. John Kuehner
(Same as above)
Note: Holy Name Housing Corporation is not a religious organization nor does it serve persons of a particular faith.
Because the founders of Holy Name Housing Corporation were concerned that the Board of Directors be neighborhood
residents, who were concerned about the neighborhood and the Corporation's faithfulness to the mission of the
neighborhood, they made the Redemptorist Fathers of Nebraska the Board of Directors. (HNHC By-laws. Article 2.2).
The Redemptorists have been active in the Holy Name neighborhood for seventy-five years. The Board of Directors
and Board of Advisors meet jointly four times a year.
HOLY NAME HOUSING CORPORATION
BOARD OF ADVISORS
Gary R. Batenhorst
(Business) Stinson Morrison Hecker LLP
Attorneys at Law
Landmark Building, 15th Floor
1299 Farnam Street
Omaha, NE 68102
(402) 930-1734 and Fax (402) 930-1701
(Home) 362 South 160th Street
Omaha, NE 68118
(402) 330-0395 •
Mike Boyle •
(Business) Boyle & Associates, Attorneys at Law
1106 Howard Street, #6
Omaha, NE 68102-2821
(402) 978-7878 Fax (402) 342-9232
(Home) 420 South 11th Street
Omaha, NE 68102
(402) 342-6336 Mike Cell Phone: 706-7810
Richard Hays, Chairperson
(Retired)
5445 Hanover Plaza
Omaha, NE 68152
(402) 572-6721
Ed Kentch, Operations Officer
(Business) First National Bank of Omaha
One First National Center
Omaha, NE. 68102 •
(402) 633-3189 Fax (402) 633-3939
(Home) 6306 South 73rd Avenue
Omaha, NE 68127
(402) 593-8703
Lou Lamberty (Retired)
320 North 68th Street
Omaha, NE. 68132
(402) 558-5820
Jennie McCartney
(Business) Mutual of Omaha
33rd & Dodge Streets
Omaha, NE 68131
(402) 351-4949 Fax (402) 351-2798
(Home) 9117 Westridge Drive
Omaha, NE. 68124
Peggy Murphy
(Business) Peter Kiewit Sons, Inc.
1000 Kiewit Plaza
Omaha, NE 68131
Work: (402) 342-2052 Ext. 2560 Fax: (402) 271-2981
(Home) 1816 South 133rd Street
Omaha, NE 68144
(402) 334-1275
Chris Ott
(Business) American Games, Inc.
Work (712) 366-9553
(Home) 4527 North 78th Avenue
Omaha, NE 68134
(402) 393-1717
Shawn Peterson, Owner
(Business) Acrylicon, Inc.
PO Box 11326
Omaha, NE 68111-0326
(402) 451-1365 Fax (402) 451-1366
(Home) 306 South 56th Street
Omaha, NE 68132
Fax: (402) 556-8689
Betty F. Quinn
(Business) CBS/HOME Real Estate
11213 Davenport St.
Omaha, NE 68154
(402) 334-5500 Fax (402) 697-4401 Cell (402) 677-5863 Fax 588-3041
(Home) 6300 Dodge Street
Omaha, NE 68132
(402) 558-2950
*Terry Rogers-Womack
(Business) First Data Employment Office
90th andMilitaryAvenue
Omaha, NE 68134
(402) 777-2331 Fax: (402) 777-1146
(Home) 2125 Spencer Street
Omaha, NE. 68110
(402) 451-6882
Bruce Thomas
(Business) Prairie Systems
7200 World Communication Drive
Omaha, NE. 68122
(402) 398-4100 Fax (402) 398-4482
(Home) 604 North 65th Street
Omaha, NE 68121
(402) 553-6321
*Louis Wright
(Business) Omaha Economic Development Corp.
2221 North 24th Street
Omaha, NE. 68102
(402) 346-2300 Fax (402) 346-3368
*Neighborhood Residents
HOLY NAME
HOUSING
/ December 2, 2004 CORPORATION
City of Omaha Planning Department
Omaha/Douglas Civic Center
1819 Farnam Street, Suite 1111
Omaha, NE 68183
RE: SCOPE OF WORK
Holy Name Housing Corporation (HNHC)
$300,000.00 CDBG/HOME Funds
Construction of Single Family Homes
HNHC will construct approximately six new homes in order to continue with the development of the 1
Fontenelle View Subdivision. This subdivision is bounded by Ames Avenue on the south, Fowler
Avenue on the north, 45th Street on the east and 4011 Street on the west.
HNHC will provide pre-purchase counseling to low and moderate income families who purchase these
homes.
HNHC will assist families to secure private financing for a first mortgage at an affordable rate and to
meet city requirements for second mortgage.
HNHC will maintain such records and accounts, including property, personnel and financial records as
are deemed necessary by the City to assure proper accounting for all expenses.
HNHC will make best efforts to ensure that construction services, contracts and employment
opportunities are affirmatively marketed to women and minority groups.
HNHC will employ affirmative marketing procedures in the advertising and marketing of the
completed houses.
HNHC shall ensure that clients who do not qualify for or are refused first mortgage financing
assistance through Omaha 100, Inc., are referred to Family Housing Advisory Services (FHAS) for
housing counseling services identical to that received by qualified or approved clients referred to
FHAS.
Sincerely,
ee,......
Sr. Marilyn Ro6
Executive Director
3014 North 45th Street
Omaha, Nebraska 68104
402-453-6100 • Fax 402-451-7187
Exhibit B
COMMUNITY HOUSING DEVELOPMENT ORGANIZATION (CHDO)
QUALIFICATION CHECKLIST
Name of Organization: Holy Name Housing Corporation
Contact Person: Sr. Marilyn Ross
Phone: 402.453.6100
Address: 3014 North 45t1i Street, Omaha,NE 68104
I certify that Holy Name Housing Corporation
x meets the qualifications of a Community Housing Development Organization
(CHDO) in accordance with Sub Part A, 92.2 of the HOME Rule.
mes Thele, Assistant Planning Director Date
Robert Peters, Planning Director Date
Exhibit C
Attachment 7
Housing and Community Development Division
City of Omaha Planning Department
Cost Certification Form
Project Name: �Q(��eY 1 V Ie\ ���5e T 1�
Project Owner: e \ 1o` sic•Nc
Project Address:
cra
Project Cost Estimate: 71: 1 /7O QOQ
The Rehabilitation Division has reviewed the project cost estimate, work write-up or
plans, specifications, & proposal. In our opinion the project cost estimate is accurate.
(See attached)
Rehabilitation Inspector:
Rehabilitation Manager: `/ 0�
"
EXHIBIT 0
CIRCULAR NO.A-110
Revised
TO THE HEADS OF EXECUTIVE DEPARTMENTS AND ESTABLISHMENTS
SUBJECT: Uniform Administrative Requirements for Grants and Agreements with Institutions of Higher
Education,Hospitals,and Other Non-Profit Organizations
I. Purpose. This Circular sets forth standards for obtaining consistency and uniformity among
Federal agencies in the administration of grants to and agreements with institutions of higher
education, hospitals, and other non-profit organizations.
2. Authority. Circular A-110 is issued under the authority of 31 USC 503 (the Chief Financial
Officers Act), 31 USC 1111, 41 USC 405 (the Office of Federal Procurement Policy Act),
Reorganization Plan No. 2 of 1970, and EO 11541 ("Prescribing the Duties of the Office of
Management and Budget and the Domestic Policy Council in the Executive Office of the
President").
3. Policy. Except as provided herein, the standards set forth in this Circular are applicable to all
Federal agencies. If any statute specifically prescribes policies or specific requirements that
differ from the standards provided herein, the provisions of the statute shall govern.
The provisions of the sections of this Circular shall be applied by Federal agencies to recipients. Recipients
shall apply the provisions of this Circular to sub-recipients performing substantive work under grants and
agreements that are passed through or awarded by the primary recipient, if such sub-recipients are organizations
described in Paragraph 1.
This Circular does not apply to grants, contracts,or other agreements between the Federal
Government and units of State or local governments covered by OMB Circular A-102, "Grants
and Cooperative Agreements with State and Local Governments", and the Federal agencies'
grants management common rule which standardized and codified the administrative
requirements Federal agencies impose on State and local grantees. In addition, sub-awards and
contracts to State or local governments are not covered by this Circular. However, this Circular
applies to sub-awards made by State and local governments to organizations covered by this
Circular. Federal agencies may apply the provisions of this Circular to commercial
organizations, foreign governments, organizations under the jurisdiction of foreign governments,
and international organizations.
4. Definitions. Definitions of key terms used in this Circular are contained in Section .2 in
Attachment.
5. Rethequired Action. The specific requirements and responsibilities of Federal agencies and
institutions of higher education, hospitals, and other non-profit organizations are set forth in
this Circular. Federal agencies responsible for awarding and administering grants to and
other agreements with organizations described in Paragraph I shall adopt the language in the
v
Circular unless different provisions are required by Federal statute or are approved by OMB.
6. OMB Responsibilities. OMB will review agency regulations and implementation of this
Circular, and will provide interpretations of policy requirements and assistance to insure
effective and efficient implementation. Any exceptions will be subject to approval by OMB,
as indicated in Section .4 in the Attachment. Exceptions will only be made in particular
cases where adequate justification is presented.
7. Information Contact. Further information concerning this Circular may be obtained by
contacting the Office of Federal Financial Management, Office of Management and Budget,
Washington, DC 20503, telephone{202) 395-3993.
8. Termination Review Date. This Circular will have a policy review three years from date of
issuance.
9. Effective Date. The standards set forth in this Circular which affect Federal agencies will be
effective 30 days after publication of the final revision in the Federal Register. Those
standards which Federal agencies impose on grantees will be adopted by agencies in codified
regulations within six months after publication in the Federal Register. Earlier
implementation is encouraged.
Attachment
Grants and Agreements with Institutions of Higher Education,
Hospitals, and Other Non-Profit Organizations
SUBPART A-GENERAL
Sec.
.l. Purpose.
.2 Definitions.
.3 Effect on other issuances.
.4 Deviations.
.5 Sub-awards.
SUBPART B-PRE-AWARD REQUIREMENTS
.10 Purpose.
.11 Pre-award policies.
.12 Forms for applying for Federal assistance.
.13 Debarment and suspension.
.14 Special award conditions.
.15 Metric system of measurement.
.16 Resource Conservation and Recovery Act.
.17 Certifications and representations.
SUBPART C-POST-AWARD REQUIREMENTS
Financial and Program Management
.20 Purpose of financial and program management.
.21 Standards for financial management systems.
.22 Payment.
.23 Cost sharing or matching.
.24 Program income.
.25 Revision of budget and program plans.
.26 Non-Federal audits.
.27 Allowable costs.
.28 Period of availability of funds.
.29 Conditional exemptions.
Property Standards
.30 Purpose of property standards.
.31 Insurance coverage.
.32 Real property.
.33 Federally-owned and exempt property.
.34 Equipment.
.35 Supplies and other expendable property.
.36 Intangible property.
.37 Property trust relationship.
Procurement Standards
.40 Purpose of procurement standards.
.41 Recipient responsibilities.
.42 Codes of conduct.
.43 Competition.
.44 Procurement procedures.
.45 Cost and price analysis.
.46 Procurement records.
.47 Contract administration.
.48 Contract provisions.
Reports and Records
.50 Purpose of reports and records.
.51 Monitoring and reporting program performance.
.52 Financial reporting.
.53 Retention and access requirements for records.
Termination and Enforcement
.60 Purpose of termination and enforcement.
.61 Termination.
.62 Enforcement.
SUBPART D-AFTER-THE-AWARD REQUIREMENTS
.70 Purpose.
.71 Closeout procedures.
.72 Subsequent adjustments and continuing responsibilities.
.73 Collection of amounts due.
APPENDIX A-CONTRACT PROVISIONS
* * * * *
SUBPART A-General
.1 Purpose. This Circular establishes uniform administrative requirements for Federal grants
and agreements awarded to institutions of higher education, hospitals, and other non-
profit organizations. Federal awarding agencies shall not impose additional or
inconsistent requirements, except as provided in Sections .4, and .14 or unless
specifically required by Federal statute or executive order. Non-profit organizations that
implement Federal programs for the States are also subject to State requirements.
.2 Definitions.
(a) Accrued expenditures means the charges incurred by the recipient during a given
period requiring the provision of funds for:
(1) goods and other tangible property received;
(2) services performed by employees, contractors, sub-recipients, and other payees;
and,
(3) other amounts becoming owed under programs for which no current services or
performance is required.
(b) Accrued income means the sum of:
(1) earnings during a given period from
(i) services performed by the recipient, and
(ii) goods and other tangible property delivered to purchasers, and
(2) amounts becoming owed to the recipient for which no current services or performance is required
by the recipient.
(c) Acquisition cost of equipment means the net invoice price of the equipment,
including the cost of modifications, attachments, accessories, or auxiliary apparatus
necessary to make the property usable for the purpose for which it was acquired.
Other charges, such as the cost of installation, transportation, taxes, duty or protective
in-transit insurance, shall be included or excluded from the unit acquisition cost in
accordance with the recipient's regular accounting practices.
(d) Advance means a payment made by Treasury check or other appropriate payment
mechanism to a recipient upon its request either before outlays are made by the
recipient or through the use of predetermined payment schedules.
(e) Award means financial assistance that provides support or stimulation to accomplish
a public purpose. Awards include grants and other agreements in the form of money
or property in lieu of money, by the Federal Government to an eligible recipient. The
term does not include: technical assistance, which provides services instead of
money; other assistance in the form of loans, loan guarantees, interest subsidies, or
insurance; direct payments of any kind to individuals; and, contracts which are
required to be entered into and administered under procurement laws and regulations.
(f) Cash contributions means the recipient's cash outlay, including the outlay of money
contributed to the recipient by third parties.
(g) Closeout means the process by which a Federal awarding agency determines that all
applicable administrative actions and all required work of the award have been
completed by the recipient and Federal awarding agency.
(h) Contract means a procurement contract under an award or sub-award, and a
procurement subcontract under a recipient's or sub-recipient's contract.
(i) Cost sharing or matching means that portion of project or program costs not borne
by the Federal Government.
(j) Date of completion means the date on which all work under an award is completed
or the date on the award document, or any supplement or amendment thereto, on
which Federal sponsorship ends.
(k) Disallowed costs means those charges to an award that the Federal awarding agency
determines to be unallowable, in accordance with the applicable Federal cost
principles or other terms and conditions contained in the award.
(1) Equipment means tangible non-expendable personal property including exempt
property charged directly to the award having a useful life of more than one year and
an acquisition cost of $5000 or more per unit. However, consistent with recipient
policy, lower limits may be established.
(m)Excess property means property under the control of any Federal awarding agency
that, as determined by the head thereof, is no longer required for its needs or the
discharge of its responsibilities.
(n) Exempt property means tangible personal property acquired in whole or in part with
Federal funds, where the Federal awarding agency has statutory authority to vest title
in the recipient without further obligation to the Federal Government. An example of
exempt property authority is contained in the Federal Grant and Cooperative
Agreement Act (31 USC 6306), for property acquired under an award to conduct
basic or applied research by a non-profit institution of higher education or non-profit
organization whose principal purpose is conducting scientific research.
(o) Federal awarding agency means the Federal agency that provides an award to the
recipient.
(p) Federal funds authorized means the total amount of Federal funds obligated by the
Federal Government for use by the recipient. This amount may include any
authorized carryover of unobligated funds from prior funding periods when permitted
by agency regulations or agency implementing instructions.
(q) Federal share of real property, equipment, or supplies means that percentage of
the property's acquisition costs and any improvement expenditures paid with Federal
funds.
(r) Funding period means the period of time when Federal funding is available for
obligation by the recipient.
(s) Intangible property and debt instruments means, but is not limited to, trademarks,
copyrights, patents and patent applications and such property as loans, notes and other
debt instruments, lease agreements, stock and other instruments of property
ownership, whether considered tangible or intangible.
(t) Obligations means the amounts of orders placed, contracts and grants awarded,
services received and similar transactions during a given period that require payment
by the recipient during the same or a future period.
(u) Outlays or expenditures mean charges made to the project or program. They may
be reported on a cash or accrual,basis. For reports prepared on a cash basis, outlays
are the sum of cash disbursements for direct charges for goods and services, the
amount of indirect expense charged, the value of third party in-kind contributions
applied and the amount of cash advances and payments made to sub-recipients. For
reports prepared on an accrual basis, outlays are the sum of cash disbursements for
direct charges for goods and services, the amount of indirect expense incurred, the
value of in-kind contributions applied, and the net increase (or decrease) in the
amounts owed by the recipient for goods and other property received, for services
performed by employees, contractors, sub-recipients and other payees and other
amounts becoming owed under programs for which no current services or
performance are required.
(v) Personal property means property of any kind except real property. It may be
tangible, having physical existence, or intangible, having no physical existence, such
as copyrights, patents, or securities.
(w)Prior approval means written approval by an authorized official evidencing prior
consent.
(x) Program income means gross income earned by the recipient that is directly
generated by a supported activity or earned as a result of the award (see exclusions in
Paragraphs .24 (e) and (h)). Program income includes, but is not limited to,
income from fees for services performed, the use or rental of real or personal property
acquired under Federally-funded projects, the sale of commodities or items fabricated
under an award, license fees and royalties on patents and copyrights, and interest on
loans made with award funds. Interest earned on advances of Federal funds is not
program income. Except as otherwise provided in Federal awarding agency
regulations or the terms and conditions of the award, program income does not
include the receipt of principal on loans, rebates, credits, discounts, etc., or interest
earned on any of them.
(y) Project costs means all allowable costs, as set forth in the applicable Federal cost
principles, incurred by a recipient and the value of the contributions made by third
parties in accomplishing the objectives of the award during the project period.
(z) Project period means• the period established in the award document during which
Federal sponsorship begins and ends.
(aa) Property means, unless otherwise stated, real property, equipment, intangible
property and debt instruments.
(bb) Real property means land, including land improvements, structures and
appurtenances thereto, but excludes movable machinery and equipment.
(cc) Recipient means an organization receiving financial assistance directly from
Federal awarding agencies to carry out a project or program. The term includes
public and private institutions of higher education, public and private hospitals, and
other quasi-public and private non-profit organizations such as, but not limited to,
community action agencies, research institutes, educational associations, and health
centers. The term may include commercial organizations, foreign or international
organizations (such as agencies of the United Nations) which are recipients, sub-
recipients, or contractors or subcontractors of recipients or sub-recipients at the
discretion of the Federal awarding agency. The term does not include government-
owned contractor-operated facilities or research centers providing continued support
for mission-oriented, large-scale programs that are government-owned or controlled,
or are designated as federally-funded research and development centers.
(dd) Research and development means all research activities, both basic and applied,
and all development activities that are supported at universities, colleges, and other
non-profit institutions. "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. 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.
(ee) Small awards means a grant or cooperative agreement not exceeding the small
purchase threshold fixed at 41 USC 403(11) (currently$25,000).
(ff)Sub-award means an award of financial assistance in the form of money, or property
in lieu of money, made under an award by a recipient to an eligible sub-recipient or
by a sub-recipient to a lower tier sub-recipient. The term includes financial assistance
when provided by any legal agreement, even if the agreement is called a contract, but
does not include procurement of goods and services nor does it include any form of
assistance which is excluded from the definition of"award" in }(e Paragraph .
(gg) Sub-recipient means the legal entity to which a sub-award is made and which is
accountable to the recipient for the use of the funds provided. The term may include
foreign or international organizations (such as agencies of the United Nations) at the
discretion of the Federal awarding agency.
(hh)Supplies means all personal property excluding equipment, intangible property, and debt instruments
as defined in this section, and inventions of a contractor conceived or first actually reduced to practice
in the performance of work under a funding agreement ("subject inventions"), as defined in 37 CFR
part 401, "Rights to Inventions Made by Nonprofit Organizations and Small Business Firms Under
Government Grants, Contracts, and Cooperative Agreements".
(ii) Suspension means an action by a Federal awarding agency that temporarily
withdraws Federal sponsorship under an award, pending corrective action by the
recipient or pending a decision to terminate the award by the Federal awarding
agency. Suspension of an award is a separate action from suspension under Federal.
agency regulations implementing EO's 12549 and 12689, "Debarment and
Suspension".
(ji) Termination means the cancellation of Federal sponsorship, in whole or in part,
under an agreement at any time prior to the date of completion.
(kk) Third party in-kind contributions means the value of non-cash contributions
provided by non-Federal third parties. Third party in-kind contributions may be in
the form of real property, equipment, supplies and other expendable property, and the
value of goods and services directly benefiting and specifically identifiable to the
project or program.
(II) Unliiquidated obligations, for financial reports prepared on a cash basis, means the
amount of obligations incurred by the recipient that have not been paid. For reports
prepared on an accrued expenditure basis, they represent the amount of obligations
incurred by the recipient for which an outlay has not been recorded.
(mm) Unobligated balance means the portion of the funds authorized by the Federal
awarding agency that has not been obligated by the recipient and is determined by
deducting the cumulative obligations from the cumulative funds authorized.
(nn) Unrecovered indirect cost means the difference between the amount awarded
and the amount, which could have been awarded under the recipient's approved
negotiated indirect cost rate.
(oo) Working capital advance means a procedure, where by funds are advanced to
the recipient to cover its estimated disbursement needs for a given initial period.
.3 Effect on other issuances. For awards subject to this Circular, all administrative
requirements of codified program regulations, program manuals, handbooks and other
non-regulatory materials which are inconsistent with the requirements of this Circular
shall be superseded, except to the extent they are required by statute, or authorized in
accordance with the deviations provision in Section .4.
.4 Deviations. The Office of Management and Budget (OMB) may grant exceptions for
classes of grants or recipients subject to the requirements of this Circular when
exceptions are not prohibited by statute. However, in the interest of maximum
uniformity, exceptions from the requirements of this Circular shall be permitted only in
unusual circumstances. Federal awarding agencies may apply more restrictive
requirements to a class of recipients when approved by OMB. Federal awarding agencies
may apply less restrictive requirements when awarding small awards, except for those
requirements, which are statutory. Exceptions on a case-by-case basis may also be made
by Federal awarding agencies.
.5 Sub-awards. Unless sections of this Circular specifically exclude sub-recipients from
coverage, the provisions of this Circular shall be applied to sub-recipients performing
work under awards if such sub-recipients are institutions of higher education, hospitals or
other non-profit organizations. State and local government sub-recipients are subject to
the provisions of regulations implementing the grants management common rule,
"Uniform Administrative Requirements for Grants and Cooperative Agreements to State
and Local Governments", published at 53 FR 8034(3/11/88).
SUBPART B-Pre-Award Requirements
.10 Purpose. Sections .11 through .17 prescribes forms and instructions and other pre-award matters to
be used in applying for Federal awards.
.11 Pre-award policies.
a) Use of Grants and Cooperative Agreements, and Contracts. In each instance, the Federal awarding
agency shall decide on the appropriate award instrument (i.e., grant, cooperative agreement, or
contract). The Federal Grant and Cooperative Agreement Act (31 USC 6301-08) governs the use of
grants, cooperative agreements and contracts. A grant or cooperative agreement shall be used only
when the principal purpose of a transaction is to accomplish a public purpose of support or stimulation
authorized by Federal statute. The statutory criterion for choosing between grants and cooperative
agreements is that for the latter, "substantial involvement is expected between the executive agency and
the State, local government, or other recipient when carrying out the activity contemplated in the
agreement". Contracts shall be used when the principal purpose is acquisition of property or services
for the direct benefit or use of the Federal Government.
(b) Public Notice and Priority Setting. Federal awarding agencies shall notify the public of its intended
funding priorities for discretionary grant programs, unless funding priorities are established by Federal
statute.
.12 Forms for applying for Federal assistance.
(a) Federal awarding agencies shall comply with the applicable report clearance requirements of 5 CFR
part 1320, "Controlling Paperwork Burdens on the Public", with regard to all forms used by the
Federal awarding agency in place of or as a supplement to the Standard Form 424(SF-424)series.
(b) Applicants shall use the SF-424 series or those forms and instructions prescribed by
the Federal awarding agency.
(c) For Federal programs covered by EO 12372, "Intergovernmental Review of Federal
Programs", the applicant shall complete the appropriate sections of the SF-424
(Application for Federal Assistance) indicating whether the application was subject to
review by the State Single Point of Contact (SPOC). The name and address of the
SPOC for a particular State can be obtained from the Federal awarding agency or the
Catalog of Federal Domestic Assistance. The SPOC shall advise the applicant
whether the program for which application is made has been selected by that State for
review.
(d) Federal awarding agencies that do not use the SF-424 form should indicate whether
the application is subject to review by the State under EO 12372.
�.13 Debarment and suspension. Federal awarding agencies and recipients shall comply with
the non-procurement debarment and suspension common rule implementing EO's 12549
and 12689, "Debarment and Suspension". This common rule restricts sub-awards and
contracts with certain parties that are debarred, suspended or otherwise excluded from or
ineligible for participation in Federal assistance programs or activities.
.14 Special award conditions. If an applicant or recipient:
(a) has a history of poor performance,
(b) is not financially stable,
(c) has a management system that does not meet the standards prescribed in this Circular,
(d) has not conformed to the terms and conditions of a previous award, or
(e) is not otherwise responsible.
Federal awarding agencies may impose additional requirements as needed, provided that
such applicant or recipient is notified in writing as to: the nature of the additional
requirements, the reason why the additional requirements are being imposed, the nature
of the corrective action needed, the time allowed for completing the corrective actions,
and the method for requesting reconsideration of the additional requirements imposed.
Any special conditions shall be promptly removed once the conditions that prompted
them have been corrected.
.15 Metric system of measurement. The Metric Conversion Act, as amended by the Omnibus Trade and
Competitiveness Act(15 USC 205)declares that the metric system is the preferred measurement system for
U.S. trade and commerce. The Act requires each Federal agency to establish a date or dates in consultation
with the Secretary of Commerce, when the metric system of measurement will be used in the agency's
procurements, grants, and other business-related activities. Metric implementation may take longer where
the use of the system is initially impractical or likely to cause significant inefficiencies in the
accomplishment of Federally-funded activities. Federal awarding agencies shall follow the provisions of
EO 12770, "Metric Usage in Federal Government Programs".
.16 Resource Conservation and Recovery Act (RCRA) (Pub. L. 94-580 codified at 42 USC
6962). Under the Act, any State agency or agency of a political subdivision of a State
which is using appropriated Federal funds must comply with Section 6002. Section 6002
requires that preference be given in procurement programs to the purchase of specific
products containing recycled materials identified in guidelines developed by the
Environmental Protection Agency (EPA) (40 CFR parts 247-254). Accordingly, State
and local institutions of higher education, hospitals, and non-profit organizations that
receive direct Federal awards or other Federal funds shall give preference in their
procurement programs funded with. Federal funds to the purchase of recycled products
pursuant to the EPA guidelines.
_.17 Certifications and representations. Unless prohibited by statute or codified regulation, each Federal
awarding agency is authorized and encouraged to allow recipients to submit certifications and
representations required by statute, executive order, or regulation on an annual basis, if the recipients have
ongoing and continuing relationships with the agency. Annual certifications and representations shall be
signed by responsible officials with the authority to ensure recipients' compliance with the pertinent
requirements.
SUBPART C - Post-Award Requirements
Financial and Program Management
Purpose of financial and program management. Sections .21 through .28 prescribe standards for
financial management systems, methods for making payments and rules for: satisfying cost sharing and
matching requirements, accounting for program income, budget revision approvals, making audits,
determining allowability of cost,and establishing fund availability.
.21 Standards for financial management systems.
(a) Federal awarding agencies shall require recipients to relate financial data to
performance data and develop unit cost information whenever practical.
(b) Recipients' financial management systems shall provide for the following.
(I) Accurate, current and complete disclosure of the financial results of each Federally-sponsored
project or program in accordance with the reporting requirements set forth in Section .52. If a
Federal awarding agency requires reporting on an accrual basis from a recipient that maintains its
records on other than an accrual basis, the recipient shall not be required to establish an accrual
accounting system. These recipients may develop such accrual data for its reports on the basis of
an analysis of the documentation on hand.
(2) Records that identify adequately the source and application of funds for
Federally-sponsored activities. These records shall contain information pertaining
to Federal awards, authorizations, obligations, unobligated balances, assets,
outlays, income and interest.
(3) Effective control over and accountability for all funds, property and other assets.
Recipients shall adequately safeguard all such assets and assure they are used
solely for authorized purposes.
(4) Comparison of outlays with budget amounts for each award. Whenever
appropriate, financial information should be related to performance and unit cost
data.
(5) Written procedures to minimize the time elapsing between the transfer of funds to
the recipient from the U.S. Treasury and the issuance or redemption of checks,
warrants or payments by other means for program purposes by the recipient. To
the extent that the provisions of the Cash Management Improvement Act (CMIA)
(Pub. L. 101-453) govern, payment methods of State agencies, instrumentalities,
and fiscal agents shall be consistent with CMIA Treasury-State Agreements or the
CMIA default procedures codified at 31 CFR part 205, "Withdrawal of Cash from
the Treasury for Advances under Federal Grant and Other Programs".
(6) Written procedures for determining the reasonableness, allocability and
allowability of costs in accordance with the provisions of the applicable Federal
cost principles and the terms and conditions of the award.
(7) Accounting records including cost accounting records that are supported by
source documentation.
(c) Where the Federal Government guarantees or insures the repayment of money
borrowed by the recipient, the Federal awarding agency, at its discretion, may require
adequate bonding and insurance if the bonding and insurance requirements of the
recipient are not deemed adequate to protect the interest of the Federal Government.
(d) The Federal awarding agency may require adequate fidelity bond coverage where the
recipient lacks sufficient coverage to protect the Federal Government's interest.
(e) Where bonds are required in the situations described above, the bonds shall be
obtained from companies holding certificates of authority as acceptable sureties, as
prescribed in 31 CFR part 223, "Surety Companies Doing Business with the United
States".
.22 Payment.
(a) Payment methods shall minimize the time elapsing between the transfer of funds from
the United States Treasury and the issuance or redemption of checks, warrants, or
payment by other means by the recipients. Payment methods of State agencies or
instrumentalities shall be consistent with Treasury-State CMIA agreements or default
procedures codified at 31 CFR part 205.
(b) Recipients are to be paid in advance, provided they maintain or demonstrate the
willingness to maintain:
(1) written procedures that minimize the time elapsing between the transfer of funds
and disbursement by the recipient, and
(2) financial management systems that meet the standards for fund control and
accountability as established in Section .21. Cash advances to a recipient
organization shall be limited to the minimum amounts needed and be timed to be
in accordance with the actual, immediate cash requirements of the recipient
organization in carrying out the purpose of the approved program or project. The
timing and amount of cash advances shall be as close as is administratively
feasible to the actual disbursements by the recipient organization for direct
program or project costs and the proportionate share of any allowable indirect
costs.
(c) Whenever possible, advances shall be consolidated to cover anticipated cash needs
for all awards made by the Federal awarding agency to the recipient.
(1) Advance payment mechanisms include, but are not limited to, Treasury check and
electronic funds transfer.
(2) Advance payment mechanisms are subject to 31 CFR part 205.
(3) Recipients shall be authorized to submit requests for advances and
reimbursements at least monthly when electronic fund transfers are not used.
(d) Requests for Treasury check advance payment shall be submitted on SF-270,
"Request for Advance or Reimbursement", or other forms as may be authorized by
OMB. This form is not to be used when Treasury check advance payments are made
to the recipient automatically through the use of a predetermined payment schedule or
if precluded by special Federal awarding agency instructions for electronic funds
transfer.
(e) Reimbursement is the preferred method when the requirements in Paragraph (b)
cannot be met. Federal awarding agencies may also use this method on any
construction agreement, or if the major portion of the construction project is
accomplished through private market financing or Federal loans, and the Federal
assistance constitutes a minor portion of the project.
(1) When the reimbursement method is used, the Federal awarding agency shall make payment within
30 days after receipt of the billing,unless the billing is improper.
(2) Recipients shall be authorized to submit request for reimbursement at least
monthly when electronic funds transfers are not used.
(f) If a recipient cannot meet the criteria for advance payments and the Federal awarding
agency has determined that reimbursement is not feasible because the recipient lacks
sufficient working capital, the Federal awarding agency may provide cash on a
working capital advance basis. Under this procedure, the Federal awarding agency
shall advance cash to the recipient to cover its estimated disbursement needs for an
initial period generally geared to the awardee's disbursing cycle. Thereafter, the
Federal awarding agency shall reimburse the recipient for its actual cash
disbursements. The working capital advance method of payment shall not be used for
recipients unwilling or unable to provide timely advances to their sub-recipient to
meet the sub-recipient's actual cash disbursements.
(g) To the extent available, recipients shall disburse funds available from repayments to
and interest earned on a revolving fund, program income, reblates, refunds, contract
settlements, audit recoveries and interest earned on such funds before requesting
additional cash payments.
(h) Unless otherwise required by statute, Federal awarding agencies shall not withhold
payments for proper charges made by recipients at any time during the project period
unless (1) or(2) apply.
(1) A recipient has failed to comply with the project objectives, the terms and
conditions of the award, or Federal reporting requirements.
(2) The recipient or sub-recipient is delinquent in a debt to the United States as
defined in OMB Circular A-129, "Managing Federal Credit Programs". Under
such conditions, the Federal awarding agency may, upon reasonable notice,
inform the recipient that payments shall not be made for obligations incurred after
a specified date until the conditions are corrected or the indebtedness to the
Federal Government is liquidated.
(i) Standards governing the use of banks and other institutions as depositories of funds
advanced under awards are as follows.
(1) Except for situations described in Paragraph (i)(2), Federal awarding agencies
shall not require separate depository accounts for funds provided to a recipient or
establish any eligibility requirements for depositories for funds provided to a
recipient. However, recipients must be able to account for the receipt, obligation
and expenditure of funds.
(2) Advances of Federal funds shall be deposited and maintained in insured accounts
whenever possible.
(j) Consistent with the national goal of expanding the opportunities for women-owned
and minority-owned business enterprises, recipients shall be encouraged to use
women- owned and minority-owned banks (a bank which is owned at least 50 percent
by women or minority group members).
(k) Recipients shall maintain advances of Federal funds in interest bearing accounts,
unless (1), (2)or(3) apply.
(1) The recipient receives less than $120,000 in Federal awards per year.
(2) The best reasonably available interest bearing account would not be expected to
earn interest in excess of$250 per year on Federal cash balances.
(3) 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.
(1) For those entities where CMIA and its implementing regulations do not apply,
interest earned on Federal advances deposited in interest bearing accounts shall be
remitted annually to Department of Health and Human Services, Payment
Management System, Rockville, MD 20852. Interest amounts up to $250 per year
may be retained by the recipient for administrative expense. State universities and
hospitals shall comply with CMIA, as it pertains to interest. If an entity subject to
CMIA uses its own funds to pay pre-award costs for discretionary awards without
prior written approval from the Federal awarding agency, it waives its right to recover
the interest under CMIA.
(m)Except as noted elsewhere in this Circular, only the following forms shall be
authorized for the recipients in requesting advances and reimbursements. Federal
agencies shall not require more than an original and two copies of these forms.
(1) SF-270, Request for Advance or Reimbursement. Each Federal awarding agency
shall adopt the SF-270 as a standard form for all non-construction programs when
electronic funds transfer or predetermined advance methods are not used. Federal
awarding agencies, however, have the option of using this form for construction
programs in lieu of the SF-271, "Outlay Report and Request for Reimbursement
for Construction Programs".
(2) SF-271, Outlay Report and Request for Reimbursement for Construction Programs. Each Federal
awarding agency shall adopt the SF-271 as the standard form to be used for requesting
reimbursement for construction programs. However, a Federal awarding agency may substitute
the SF-270 when the Federal awarding agency determines that it provides adequate information to
meet Federal needs.
23 Cost sharing or matching.
(a) All contributions, including cash and third party in-kind, shall be accepted as part of
the recipient's cost sharing or matching when such contributions meet all of the
following criteria.
(i) Are verifiable from the recipient's records.
(2) Are not included as contributions for any other Federally-assisted project or
program.
(3) Are necessary and reasonable.for-proper and efficient accomplishment of project.
or program objectives.
(4) Are allowable under the applicable cost principles.
(5) Are not paid by the Federal Government under another award, except where
authorized by Federal statute to be used for cost sharing or matching.
(6) Are provided for in the approved budget when required by the Federal awarding
agency.
(7) Conform to other provisions of this Circular, as applicable.
(b) Unrecovered indirect costs may be included as part of cost sharing or matching only
with the prior approval of the Federal awarding agency.
(c) Values for recipient contributions of services and property shall be established in
accordance with the applicable cost principles. If a Federal awarding agency
authorizes recipients to donate buildings or land for construction/facilities acquisition
projects or long-term use, the value of the donated property for cost sharing or
matching shall be the lesser of(1)or(2).
(1) The certified value of the remaining life of the property recorded in the recipient's accounting
records at the time of donation.
(2) The current fair market value. However, when there is sufficient justification, the Federal
awarding agency may approve the use of the current fair market value of the donated property,
even if it exceeds the certified value at the time of donation to the project.
(d) Volunteer services furnished by professional and technical personnel, consultants,
and other skilled and unskilled labor may be counted as cost sharing or matching if
the service is an integral and necessary part of an approved project or program. Rates
for volunteer services shall be consistent with those paid for similar work in the
recipient's organization. In those instances in which the required skills are not found
in the recipient organization, rates shall be consistent with those paid for similar work
in the labor market in which the recipient competes for the kind of services involved.
In either case, paid fringe benefits that are reasonable, allowable, and allocable may
be included in the valuation.
(e) When an employer other than the recipient furnishes the services of an employee,
these services shall be valued at the employee's regular rate of pay (plus an amount of
fringe benefits that are reasonable, allowable, and allocable, but exclusive of
overhead costs), provided these services are in the same skill for which the employee
is normally paid.
(f) Donated supplies may include such items as expendable equipment, office supplies,
laboratory supplies or workshop and classroom supplies. Value assessed to donated
supplies included in the cost sharing or matching share shall be reasonable and shall
not exceed the fair market value of the property at the time of the donation.
(g) The method used for determining cost sharing or matching for donated equipment,
buildings and land for which title passes to the recipient may differ according to the
purpose of the award, if(l)or(2) apply.
(1) If the purpose of the award is to assist the recipient in the acquisition of
equipment, buildings or land, the total value of the donated property may be
claimed as cost sharing or matching.
(2) If the purpose of the award is to support activities which require the use of
equipment, buildings or land, normally only depreciation or use charges for
equipment and buildings may be made. However, the full value of equipment or
other capital assets and fair rental charges for land may be allowed, provided that
the Federal awarding agency has approved the charges.
(h) The value of donated property shall be determined in accordance with the usual
accounting policies of the recipient, with the following qualifications.
(1) The value of donated land and buildings shall not exceed its fair market value at
the time of donation to the recipient as established by an independent appraiser
(e.g., certified real property appraiser or General Services Administration
representative) and certified by a responsible official of the recipient.
(2) The value of donated equipment shall not exceed the fair market value of
equipment of the same age and condition at the time of donation.
(3) The value of donated space shall not exceed the fair rental value of comparable
space as established by an independent appraisal of comparable space and
facilities in a privately-owned building in the same locality.
(4) The value of loaned equipment shall not exceed its fair rental value.
(5) The following requirements pertain to the recipient's supporting records for in-
kind contributions from third parties.
(i) Volunteer services shall be documented and, to the extent feasible, supported
by the same methods used by the recipient for its own employees.
(ii) The basis for determining the valuation for personal service, material,
equipment, buildings and land shall be documented.
.24 Program income.
(a) Federal awarding agencies shall apply the standards set forth in this section in
requiring recipient organizations to account for program income related to projects
financed in whole or in part with Federal funds.
(b) Except as provided in Paragraph(h)below, program income earned during the project period shall be
retained by the recipient and, in accordance with Federal awarding agency regulations or the terms and
conditions of the award, shall be used in one or more of the ways listed in the following.
(1) Added to funds committed to the project by the Federal awarding agency and recipient and used to
further eligible project or program objectives.
(2) Used to finance the non-Federal share of the project or program.
(3) Deducted from the total project or program allowable cost in determining the net
allowable costs on which the Federal share of costs is based.
(c) When an agency authorizes the disposition of program income as described in Paragraphs (b)(1) or
(b)(2), program income in excess of any limits stipulated shall be used in accordance with Paragraph
(b)(3).
(d) In the event that the Federal awarding agency does not specify in its regulations or the
terms and conditions of the award how program income is to be used, Paragraph
(b)(3) shall apply automatically to all projects or programs except research. For
awards that support research, Paragraph (b)(l) shall apply automatically unless the
awarding agency indicates in the terms and conditions another alternative on the
award or the recipient is subject to special award conditions, as indicated in Section
.14.
(e) Unless Federal awarding agency regulations or the terms and conditions of the award
provide otherwise, recipients shall have no obligation to the Federal Government
regarding program income earned after the end of the project period.
(f) If authorized by Federal awarding agency regulations or the terms and conditions of
the award, costs incident to the generation of program income may be deducted from
gross income to determine program income, provided these costs have not been
charged to the award.
(g) Proceeds from the sale of property shall be handled in accordance with the
requirements of the Property Standards (See Sections .30 through .37).
(h) Unless Federal awarding agency regulations or the terms and condition of the award
provide otherwise, recipients shall have no obligation to the Federal Government with
respect to program income earned from license fees and royalties for copyrighted
material, patents, patent applications, trademarks, and inventions produced under an
award. However, Patent and Trademark Amendments (35 USC 18) apply to
inventions made under an experimental, developmental, or research award.
.25 Revision of budget and program plans.
(a) The budget plan is the financial expression of the project or program as approved
during the award process. It may include either the Federal and non-Federal share, or
only the Federal share, depending upon Federal awarding agency requirements. It
shall be related to performance for program evaluation purposes whenever
appropriate.
(b) Recipients are required to report deviations from budget and program plans, and
request prior approvals for budget and program plan revisions, in accordance with
this section.
(c) For non-construction awards, recipients shall request prior approvals from Federal
awarding agencies for one or more of 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 award document.
(3) The absence 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 need for additional Federal funding.
(5) The transfer of amounts budgeted for indirect costs to absorb increases in direct
costs, or vice versa, if approval is required by the Federal awarding yagency.
(6) The inclusion, unless waived by the Federal awarding agency, of costs that
require prior approval in accordance with OMB Circular A-21, "Cost Principles
for Educational Institutions", OMB Circular A-122, "Cost Principles for Non-
Profit Organizations" or 45 CFR part 74 Appendix E, "Principles for
Determining Costs Applicable to Research and Development under Grants and
Contracts with Hospitals", or 48 CFR part 31, "Contract Cost Principles and
Procedures", as applicable.
(7) The transfer of funds allotted for training allowances (direct payment to trainees)
to other categories of expense.
(8) Unless described in the application and funded in the approved awards, the sub-award, transfer or
contracting out of any work under an award. This provision does not apply to the purchase of
supplies,material, equipment or general support services.
(d) No other prior approval requirements for specific items may be imposed unless a
deviation has been approved by OMB.
(e) Except for requirements listed in Paragraphs (c)(1) and (c)(4) of this section, Federal
awarding agencies are authorized, at their option, to waive cost-related and
administrative prior written approvals required by this Circular and OMB Circulars
A-21 and A-122. Such waivers may include authorizing recipients to do any one or
more of the following.
(1) Incur pre-award costs 90 calendar days prior to award or more than 90 calendar days with the prior
approval of the Federal awarding agency. All pre-award costs are incurred at the recipient's risk
(i.e., the Federal awarding agency is under no obligation to reimburse such costs if for any reason
the recipient does not receive an award or if the award is less than anticipated and inadequate to
cover such costs).
(2) Initiate a one-time extension of the expiration date of the award of up to 12
months unless one or more of the following conditions apply. For one-time
extensions, the recipient must notify the Federal awarding agency in writing with
the supporting reasons and revised expiration date at least 10 days before the
expiration date specified in the award. This one-time extension may not be
exercised merely for the purpose of using unobligated balances.
(i) The terms and conditions of 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 funding periods.
(4) For awards that support research, unless the Federal awarding agency provides
otherwise in the award or in the agency's regulations, the prior approval
requirements described in Paragraph (e) are automatically waived (i.e., recipients
need not obtain such prior approvals) unless one of the conditions included in
Paragraph (e)(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 awards in which the
Federal share of the project exceeds $100,000 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. No Federal awarding agency shall permit
a transfer that would cause any Federal appropriation or part thereof to be used for
purposes other than those consistent with the original intent of the appropriation.
(g) All other changes to non-construction budgets, except for the changes described in
Paragraph (j), do not require prior approval.
(h) For construction awards, recipients shall request prior written approval promptly from
Federal awarding agencies for budget revisions whenever(1), (2) or(3) apply.
(I) 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 Section .27.
(i) No other prior approval requirements for specific items may be imposed, unless a
deviation has been approved by OMB.
(j) When a Federal awarding agency makes an award that provides support for both
construction and non-construction work, the Federal awarding agency may require
the recipient to request prior approval from the Federal awarding agency before
making any fund or budget transfers between the two types of work supported.
(k) For both construction and non-construction awards, Federal awarding agencies shall
require recipients to notify the Federal awarding agency in writing promptly
whenever the amount of Federal authorized funds is expected to exceed the needs of
the recipient for the project period by more than $5000 or five percent of the Federal
award, whichever is greater. This notification shall not be required if an application
for additional funding is submittedrfor a continuation award.
(1) When requesting approval for budget revisions, recipients shall use the budget forms
that were used in the application unless the Federal awarding agency indicates a letter
of request suffices.
(m)Within 30 calendar days from the date of receipt of the request for budget revisions,
Federal awarding agencies shall 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 shall inform the recipient in
writing of the date when the recipient may expect the decision.
.26 Non-Federal audits.
(a) Recipients and sub-recipients that are institutions of higher education or other non-
profit organizations (including hospitals) shall be subject to the audit requirements
contained in the Single Audit Act Amendments of 1996 (31 USC 7501-7507) and
revised OMB Circular A-133, "Audits of States, Local Governments, and Non-Profit
Organizations".
(b) State and local governments shall be subject to the audit requirements contained in
the SinglerAudit Act Amendments of 1996 (31 USC 7501-7507) and revised OMB
Circular A-133, "Audits of States, Local Governments, and Non-Profit
Organizations".
(c) For-profit hospitals not covered by the audit provisions of revised OMB Circular A-
133 shall be subject to the audit requirements of the Federal awarding agencies.
(d) Commercial organizations shall be subject to the audit requirements of the Federal
awarding agency or the prime recipient as incorporated into the award document.
.27 Allowable costs. For each kind of recipient, there is a set of Federal principles for
determining allowable costs. Allowability of costs shall be determined in accordance
with the cost principles applicable to the entity incurring the costs. Thus, allowability of
costs incurred by State, local or federally-recognized Indian tribal governments is
determined in accordance with the provisions of OMB Circular A-87, "Cost Principles
for State, Local, and Indian Tribal Governments". The allowability of costs incurred by
non-profit organizations is determined in accordance with the provisions of OMB
Circular A-1.22, "Cost Principles for Non-Profit Organizations". The allowability of
costs incurred by institutions of higher education is determined in accordance with the
provisions of OMB Circular A-21, "Cost Principles for Educational Institutions". The
allowability of costs incurred by hospitals is determined in accordance with the
provisions of Appendix E of 45 CFR part 74, "Principles for Determining Costs
Applicable to Research and Development Under Grants and Contracts with Hospitals".
The allowability of costs incurred by commercial organizations and those non-profit
organizations listed in Attachment C to Circular A-122 is determined in accordance with
the provisions of the Federal Acquisition Regulation (FAR) at 48 CFR part 31.
.28 Period of availability of funds. Where a funding period is specified, a recipient may
charge to the grant only allowable costs resulting from obligations incurred during the
funding period and any pre-award costs authorized by the Federal awarding agency.
.29 Conditional exemptions.
(a) OMB authorizes conditional exemption from OMB administrative requirements and
cost principles circulars for certain Federal programs with statutorily-authorized
consolidated planning and consolidated administrative funding, that are identified by
a Federal agency and approved by the head of the Executive department or
establishment. A Federal agency shall consult with OMB during its consideration of
whether to grant such an exemption.
(b) To promote efficiency in State and local program administration, when Federal non-
entitlement programs with common purposes have specific statutorily-authorized
consolidated planning and consolidated administrative funding and where most of the
State agency's resources come from non-Federal sources, Federal agencies may
exempt these covered State-administered, non-entitlement grant programs from
certain OMB grants management requirements. The exemptions would be from all
but the allocability of costs provisions of OMB Circulars A-87 (Attachment A,
subsection C.3), "Cost Principles for State, Local, and Indian Tribal Governments",
A-21 (Section C, subpart 4), "Cost Principles for Educational Institutions", and A-
122 (Attachment A, subsection A.4), "Cost Principles for Non-Profit Organizations",
and from all of the administrative requirements provisions of OMB Circular A-110,
"Uniform Administrative Requirements for Grants and Agreements with Institutions
of Higher Education, Hospitals, and Other Non-Profit Organizations", and the
agencies' grants management common rule.
(c) When a Federal agency provides this flexibility, as a prerequisite to a State's
exercising this option, a State must adopt its own written fiscal and administrative
requirements for expending and accounting for all funds, which are consistent with
the provisions of OMB Circular A-87, and extend such policies to all sub-recipients.
These fiscal and administrative requirements must be sufficiently specific to ensure
that: funds are used in compliance with all applicable Federal statutory and regulatory
provisions, costs are reasonable and necessary for operating these programs, and
funds are not be used for general expenses required to carry out other responsibilities
of a State or its sub-recipients.
Property Standards
.30 Purpose of property standards. Sections .31 through .37 set forth uniform standards governing
management and disposition of property furnished by the Federal Government whose cost was charged to a
project supported by a Federal award. Federal awarding agencies shall require recipients to observe these
standards under awards and shall not impose additional requirements, unless specifically required by
Federal statute. The recipient may use its own property management standards and procedures provided it
observes the provisions of Sections .31 through .37.
.31 Insurance coverage. Recipients shall, at a minimum, provide the equivalent insurance
coverage for real property and equipment acquired with Federal funds as provided to
property owned by the recipient. Federally-owned property need not be insured unless
required by the terms and conditions of the award.
.32 Real property. Each Federal awarding agency shall prescribe requirements for recipients
concerning the use and disposition of real property acquired in whole or in part under
awards. Unless otherwise provided by statute, such requirements, at a minimum, shall
contain the following.
(a) Title to real property shall vest in the recipient subject to the condition that the
recipient shall use the real property for the authorized purpose of the project as long
as it is needed and shall not encumber the property without approval of the Federal
awarding agency.
(h) The recipient shall obtain written approval by the Federal awarding agency for the
use of real property in other Federally-sponsored projects when the recipient
determines that the property is no longer needed for the purpose of the original
project. Use in other projects shall be limited to those under Federally-sponsored
projects (i.e., awards) or programs that have purposes consistent with those
authorized for support by the Federal awarding agency.
(c) When the real property is no longer needed as provided in Paragraphs (a) and (b), the
recipient shall request disposition instructions from the Federal awarding agency or
its successor Federal awarding agency. The Federal awarding agency shall observe
one or more of the following disposition instructions.
(1) The recipient may be permitted to retain title without further obligation to the Federal Government
after it compensates the Federal Government for that percentage of the current fair market value of
the property attributable to the Federal participation in the project.
(2) The recipient may be directed to sell the property under guidelines provided by
the Federal awarding agency and pay the Federal Government for that percentage
of the current fair market value of the property attributable to the Federal
participation in the project (after deducting actual and reasonable selling and fix-
up expenses, if any, from the sales proceeds). When the recipient is authorized or
required to sell the property, proper sales procedures shall be established that
provide for competition to the extent practicable and result in the highest possible
return.
(3) The recipient may be directed to transfer title to the property to the Federal
Government or to an eligible third party provided that, in such cases, the recipient
shall be entitled to compensation for its attributable percentage of the current fair
market value of the property.
.33 Federally-owned and exempt property.
(a) Federally-owned property. •
(1) Title to Federally-owned property remains vested in the Federal Government.
Recipients shall submit annually an inventory listing of Federally-owned property
in their custody to the Federal awarding agency. Upon completion of the award
or when the property is no longer needed, the recipient shall report the property to
the Federal awarding agency for further Federal agency utilization.
(2) If the Federal awarding agency has no further need for the property, it shall be
declared excess and reported to the General Services Administration, unless the
Federal awarding agency has statutory authority to dispose of the property by
alternative methods (e.g., the authority provided by the Federal Technology
Transfer Act (15 USC 3710 (I)) to donate research equipment to educational and
non-profit organizations in accordance with EO 12821, "Improving Mathematics
and Science Education in Support of the National.Education Goals".) Appropriate
instructions shall he issued to the recipient by the Federal awarding agency.
(b) Exempt property. When statutory authority exists, the Federal awarding agency has
the option to vest title to property acquired with Federal funds in the recipient without
further obligation to the Federal Government and under conditions the Federal
awarding agency considers appropriate. Such property is "exempt property". Should
a Federal awarding agency not establish conditions, title to exempt property upon
acquisition shall vest in the recipient without further obligation to the Federal
Government.
.34 Equipment.
(a) Title to equipment acquired by a recipient with Federal funds shall vest in the
recipient, subject to conditions of this section.
(b) The recipient shall not use equipment acquired with Federal funds to provide services to non-
Federal outside organizations for a fee that is less than private companies charge for equivalent
services, unless specifically authorized by Federal statute, for as long as the Federal Government
retains an interest in the equipment.
(c) The recipient shall use the equipment in the project or program for which it was acquired as long
as needed, whether or not the project or program continues to be supported by Federal funds and
shall not encumber the property without approval of the Federal awarding agency. When no
longer needed for the original project or program, the recipient shall use the equipment in
connection with its other federally-sponsored activities,in the following order of priority:
(i) activities sponsored by the Federal awarding agency which funded the original
project, then
(ii) activities sponsored by other Federal awarding agencies.
(d) During the time that equipment is used on the project or program for which it was acquired, the
recipient shall make it available for use on other projects or programs if such other use will not
interfere with the work on the project or program for which the equipment was originally acquired.
First preference for such other use shall be given to other projects or programs sponsored by the
Federal awarding agency that financed the equipment;second preference shall be given to projects
or programs sponsored by other Federal awarding agencies. If the equipment is owned by the
Federal Government, use on other activities not sponsored by the Federal Government shall be
permissible if authorized by the Federal awarding agency. User charges shall be treated as
program income.
(e) When acquiring replacement equipment, the recipient may use the equipment to
be replaced as trade-in or sell the equipment and use the proceeds to offset the
costs of the replacement equipment subject to the approval of the Federal
awarding agency.
(f) The recipient's property management standards for equipment acquired with
Federal funds and Federally-owned equipment shall include all of the following.
(1) Equipment records shall be maintained accurately and shall include the
following information.
(i) A description of the equipment.
(ii) Manufacturer's serial number, model number, Federal stock number,
national stock number, or other identification number.
(iii)Source of the equipment, including the award number.
(iv)Whether title vests in the recipient or the Federal Government.
(v) Acquisition date (or date received, if the equipment was furnished by the
Federal Government) and cost.
(vi)Information from which one can calculate the percentage of Federal
participation in the cost of the equipment (not applicable to equipment
furnished by the Federal Government).
(vii) Location and condition of the equipment and the date the
information was reported.
(viii) Unit acquisition cost.
(ix)Ultimate disposition data, including date of disposal and sales price or the
method used to determine current fair market value where a recipient
compensates the Federal awarding agency for its share.
(2) Equipment owned by the Federal Government shall be identified to indicate
Federal ownership.
(3) A physical inventory of equipment shall be taken and the results reconciled
with the equipment records at least once every two years. Any differences
between quantities determined by the physical inspection and those shown in
the accounting records shall be investigated to determine the causes of the
difference. The recipient.shall, in connection with the inventory, verify the
existence, current utilization, and continued need for the equipment.
(4) A control system shall be in effect to insure adequate safeguards to prevent
loss, damage, or theft of the equipment. Any loss, .damage, or theft of
equipment shall be investigated and fully documented; if the equipment was
owned by the Federal Government, the recipient shall promptly notify the
Federal awarding agency.
(5) Adequate maintenance procedures shall be implemented to keep the
equipment in good condition.
(6) Where the recipient is authorized or required to sell the equipment, proper
sales procedures shall be established which provide for competition to the
extent practicable and result in the highest possible return.
(g) When the recipient no longer needs the equipment,the equipment may be used for other activities
in accordance with the following standards. For equipment with a current per unit fair market
value of $5000 or more, the recipient may retain the equipment for other uses provided that
compensation is made to the original Federal awarding agency or its successor. The amount of
compensation shall be computed by applying the percentage of Federal participation in the cost of
the original project or program to the current fair market value of the equipment. If the recipient
has no need for the equipment, the recipient shall request disposition instructions from the Federal
awarding agency. The Federal awarding agency shall determine whether the equipment can be
used to meet the agency's requirements. If no requirement exists within that agency, the
availability of the equipment shall be reported to the General Services Administration by the
Federal awarding agency to determine whether a requirement for the equipment exists in other
Federal agencies. The Federal awarding agency shall issue instructions to the recipient no later
than 120 calendar days after the recipient's request and the following procedures shall govern.
(1) If so instructed or if disposition instructions are not issued within 120 calendar
days after the recipient's request, the recipient shall sell the equipment and
reimburse the Federal awarding agency an amount computed by applying to
the sales proceeds the percentage of Federal participation in the cost of the
original project or program, However, the recipient shall be permitted to
deduct and retain from the Federal share $500 or ten percent of the proceeds,
whichever is less, for the recipient's selling and handling expenses.
(2) If the recipient is instructed to ship the equipment elsewhere, the recipient
shall be reimbursed by the Federal Government by an amount which is
computed by applying the percentage of the recipient's participation in the
cost of the original project or program to the current fair market value of the
equipment, plus any reasonable shipping or interim storage costs incurred.
(3) If the recipient is instructed to otherwise dispose of the equipment, the
recipient shall be reimbursed by the Federal awarding agency for such costs
incurred in its disposition.
(4) The Federal awarding agency may reserve the right to transfer the title to the
Federal Government or to a third party named by the Federal Government
when such third party is otherwise eligible under existing statutes. Such
transfer shall be subject to the following standards.
(i) The equipment shall be appropriately identified in the award or otherwise
made known to the recipient in writing.
(ii) The Federal awarding agency shall issue disposition instructions within
120 calendar days after receipt of a final inventory. The final inventory
shall list all equipment acquired with grant funds and Federally-owned
equipment. If the Federal awarding agency fails to issue disposition
instructions within the 120-calendar day period, the recipient shall apply
the standards of this section, as appropriate.
(iii)When the Federal awarding agency exercises its right to take title, the
equipment shall be subject to the provisions for Federally-owned
equipment.
.35 Supplies and other expendable property.
(a) Title to supplies and other expendable property shall vest in the recipient upon
acquisition. If there is a residual inventory of unused supplies exceeding $5000 in
total aggregate value upon termination or completion of the project or program and
the supplies are not needed for any other Federally-sponsored project or program, the
recipient shall retain the supplies for use on non-Federal sponsored activities or sell
them, but shall, in either case, compensate the Federal Government for its share. The
amount of compensation shall be computed in the same manner as for equipment.
(b) The recipient shall not use supplies acquired with Federal funds to provide services to
non-Federal outside organizations for a fee that is less than private companies charge
for equivalent services, unless specifically authorized by Federal statute as long as the
Federal Government retains an interest in the supplies.
.36 Intangible property.
(a) The recipient may copyright any work that is subject to copyright and was developed,
or for which ownership was purchased, under an award. The Federal awarding
agency(ies) reserve a royalty-free, nonexclusive and irrevocable right to reproduce,
publish, or otherwise use the work for Federal purposes, and to authorize others to do
so.
(b) Recipients are subject to applicable regulations governing patents and inventions,
including government-wide regulations issued by the Department of Commerce at 37
CFR part 401, "Rights to Inventions Made by Nonprofit Organizations and Small
Business Firms Under Government Grants, Contracts and Cooperative Agreements".
(c) The Federal Government has the right to:
(1) obtain, reproduce, publish or otherwise use the data first produced under an
award; and
(2) authorize others to receive, reproduce, publish, or otherwise use such data for
Federal purposes.
(d) (1) In addition, in response to a Freedom of Information Act (FOIA) request for
research data relating to published research findings produced under an award that
were used by the Federal Government in developing an agency action that has the
force and effect of law, the Federal awarding agency shall request, and the
recipient shall provide, within a reasonable time, the research data so that they can
be made available to the public through the procedures established under the
FOIA. If the Federal awarding agency obtains the research data solely in
response to a FOIA request, the•agency may charge the requester a reasonable fee
equaling the full incremental cost of obtaining the research data. This fee should
reflect costs incurred by the agency, the recipient, and applicable sub-recipients.
This fee is in addition to any fees the agency may assess under the FOIA (5 USC
552(a)(4)(A)).
(2) The following definitions apply for purposes of Paragraph (d) of this section:
(i) Research data is defined as the recorded factual material commonly accepted
in the scientific community as necessary to validate research findings, but not
any of the following: preliminary analyses, drafts of scientific papers, plans
for future research, peer reviews, or communications with colleagues. This
"recorded" material excludes physical objects (e.g., laboratory samples).
Research data also do not include:
(A)Trade secrets, commercial information, materials necessary to be held
confidential by a researcher until they are published, or similar
information which is protected under law; and
(B)Personnel and medical information and similar information the disclosure
of which would constitute a clearly unwarranted invasion of personal
privacy, such as information that could be used to identify a particular
person in a research study.
(ii) Published is defined as either when:
(A)Research findings are published in a peer-reviewed scientific or technical
journal; or
(B)A Federal agency publicly and officially cites the research findings in
support of an agency action that has the force and effect of law.
(iii)Used by the Federal Government in developing an agency action'that has the
force and effect of law is defined as when an.agency publicly and officially
cites the research findings in support of an agency action that has the force
and effect of law.
(e) Title to intangible property and debt instruments acquired under an award or sub-
award vests upon acquisition in the recipient. The recipient shall use that property for
the originally-authorized purpose, and the recipient shall 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 shall occur in
accordance with the provisions of Paragraph .34(g).
.37 Property trust relationship. Real property, equipment, intangible property and debt
instruments that are acquired or improved with Federal funds shall be held in trust by the
recipient as trustee for the beneficiaries of the project or program under which the
property was acquired or improved. Agencies may require recipients to record liens or
other appropriate notices of record to indicate that personal or real property has been
� i
•
acquired or improved with Federal funds and that use and disposition conditions apply to
the property.
Procurement Standards
.40 Purpose of procurement standards. Sections _.41 through .48 set forth standards
for use by recipients in establishing procedures for the procurement of supplies and other
expendable property, equipment, real property and other services with Federal funds.
These standards are furnished to ensure that such materials and services are obtained in
an effective manner and in compliance with the provisions of applicable Federal statutes
and executive orders. No additional procurement standards or requirements shall be
imposed by the Federal awarding agencies upon recipients, unless specifically required
by Federal statute or executive order or approved by OMB.
.41 Recipient responsibilities. The standards contained in this section do not relieve the
recipient of the contractual responsibilities arising under its contract(s). The recipient is
the responsible authority, without recourse to the Federal awarding agency, regarding the
settlement and satisfaction of all contractual and administrative issues arising out of
procurements entered into in support of an award or other agreement. This includes
disputes, claims, protests of award, source evaluation or other matters of a contractual
nature. Matters concerning violation of statute are to be referred to such Federal, State or
local authority, as may have proper jurisdiction.
.42 Codes of conduct. The recipient shall maintain written standards of conduct governing
the performance of its employees engaged in the award and administration of contracts.
No employee, officer, or agent shall participate in the selection, award, or administration
of a contract supported by Federal funds if a real or apparent conflict of interest would be
involved. Such a conflict would arise when the employee, officer, or agent, any member
of his or her immediate family, his or her partner, or an organization which employs or is
about to employ any of the parties indicated herein, has a financial or other interest in the
firm selected for an award. The officers, employees, and agents of the recipient shall
neither solicit nor accept gratuities, favors, or anything of monetary value from
contractors, or parties to sub-agreements. However, recipients may set standards for
situations in which the financial interest is not substantial or the gift is an unsolicited item
of nominal value. The standards of conduct shall provide for disciplinary actions to be
applied for violations of such standards by officers, employees, or agents of the recipient.
.43 Competition. All procurement transactions shall be conducted in a manner to provide, to
the maximum extent practical, open and free competition. The recipient shall be alert to
organizational conflicts of interest as well as noncompetitive practices among contractors
that may restrict or eliminate competition or otherwise restrain trade. In order to ensure
objective contractor performance and eliminate unfair competitive advantage, contractors
that develop or draft specifications, requirements, statements of work, invitations for bids
and/or requests for proposals shall be excluded from competing for such procurements.
Awards shall be made to the bidder or offeror whose bid or offer is responsive to the
solicitation and is most advantageous to the recipient, price, quality and other factors
considered. Solicitations shall clearly set forth all requirements that the bidder or offeror
shall fulfill in order for the bid or offer to be evaluated by the recipient. Any and all bids
or offers may be rejected when it is in the recipient's interest to do so.
.44 Procurement procedures.
(a) All recipients shall establish written procurement procedures. These procedures shall
provide for, at a minimum, that (1), (2) and (3) apply.
(1) Recipients avoid purchasing unnecessary items.
(2) Where appropriate, an analysis is made of lease and purchase alternatives to
determine which would be the most economical and practical procurement for the
Federal Government.
(3) Solicitations for goods and services provide for all of the following.
(i) A clear and accurate description of the technical requirements for the material,
product or service is to be procured. In competitive procurements, such a
description shall not contain features, which unduly restrict competition.
(ii) Requirements which the bidder/offeror must fulfill and all other factors are to
be used in evaluating bids or proposals.
(iii)A description, whenever practicable, of technical requirements in terms of
functions to be performed or performance required, including the range of
acceptable characteristics or minimum acceptable standards.
(iv)The specific features of "brand name or equal" descriptions that bidders are
required to meet when such items are included in the solicitation.
(v) The acceptance, to the extent practicable and economically feasible, of
products and services dimensioned in the metric system of measurement.
(vi)Preference, to the extent practicable and economically feasible, for products
and services that conserve natural resources and protect the environment and
are energy efficient.
(b) Positive efforts shall be made by recipients to utilize small businesses, minority-
owned firms, and women's business enterprises, whenever possible. Recipients of
Federal awards shall take all of the following steps to further this goal.
(1) Ensure that small businesses,minority-owned firms, and women's business enterprises are used to
the fullest extent practicable.
(2) Make information on forthcoming opportunities available and arrange time
frames for purchases and contracts to encourage and facilitate participation by
small businesses, minority-owned firms, and women's business enterprises.
(3) Consider in the contract process whether firms competing for larger contracts
intend to subcontract with small businesses, minority-owned firms, and women's
business enterprises.
(4) Encourage contracting with consortiums of small businesses, minority-owned
firms and women's business enterprises when a contract is too large for one of
these firms to handle individually.
(5) Use the services and assistance, as appropriate, of such organizations as the Small
Business Administration and the Department of Commerce's Minority Business
Development Agency in the solicitation and utilization of small businesses,
minority- owned firms and women's business enterprises.
(c) The type of procuring instruments used (e.g., fixed price contracts, cost reimbursable
contracts, purchase orders, and incentive contracts) shall be determined by the
recipient but shall be appropriate for the particular procurement and for promoting the
best interest of the program or project involved. The "cost-plus-a-percentage-of-cost"
or "percentage of construction cost"methods of contracting shall not be used.
(d) Contracts shall be made only with responsible contractors who possess the potential
ability to perform successfully under the terms and conditions of the proposed
procurement. Consideration shall be given to such matters as contractor integrity,
record of past performance, financial and technical resources or accessibility to other
necessary resources. In certain circumstances, contracts with certain parties are
restricted by agencies' implementation of EO's 12549 and 12689, "Debarment and
Suspension".
(e) Recipients shall, on request, make available for the Federal awarding agency, pre-
award review and procurement documents, such as request for proposals or
invitations for bids, independent cost estimates, etc., when any of the following
conditions apply.
(1) A recipient's procurement procedures or operation fails to comply with the
procurement standards in the Federal awarding agency's implementation of this
Circular.
(2) The procurement is expected to exceed the small purchase threshold fixed at 41
USC 403 (11) (currently $25,000) and is to be awarded without competition or
only one bid or offer is received in response to a solicitation.
(3) The procurement, which is expected to exceed the small purchase threshold,
specifies a "brand name" product.
(4) The proposed award over the small purchase threshold is to be awarded to other
than the apparent low bidder under a sealed bid procurement.
(5) A proposed contract modification changes the scope of a contract or increases the contract amount
by more than the amount of the small purchase threshold.
.45 Cost and price analysis. Some form of cost or price analysis shall be made and
documented in the procurement files in connection with every procurement action. Price
analysis may be accomplished in various ways, including the comparison of price
quotations submitted, market prices and similar indicia, together with discounts. Cost
analysis is the review and evaluation of each element of cost to determine reasonableness,
allocability and allowability.
.46 Procurement records. Procurement records and files for purchases in excess of the small
purchase threshold shall include the following at a minimum:
(a) basis for contractor selection,
(b) justification for lack of competition when competitive bids or offers are not obtained,
and
(c) basis for award cost or price.
.47 Contract administration. A system for contract administration shall be maintained to
ensure contractor conformance with the terms, conditions and specifications of the
contract and to ensure adequate and timely follow up of all purchases. Recipients shall
evaluate contractor performance and document, as appropriate, whether contractors have
met the terms, conditions and specifications of the contract.
.48 Contract provisions. The recipient shall include, in addition to provisions to define a
sound and complete agreement, the following provisions in all contracts. The following
provisions shall also be applied to subcontracts.
(a) Contracts in excess of the small purchase threshold shall contain contractual
provisions or conditions that allow for administrative, contractual, or legal remedies
in instances in which a contractor violates or breaches the contract terms, and provide
for such remedial actions as may be appropriate.
(b) All contracts in excess of the small purchase threshold shall contain suitable
provisions for termination by the recipient, including the manner by which
termination shall be effected and the basis for settlement. In addition, such contracts
shall describe conditions under which the contract may be terminated for default as
well as conditions where the contract may be terminated because of circumstances
beyond the control of the contractor.
(c) Except as otherwise required by statute, an award that requires the contracting (or
subcontracting) for construction or facility improvements shall provide for the
recipient to follow its own requirements relating to bid guarantees, performance
bonds, and payment bonds unless the construction contract or subcontract exceeds
$100,000. For those contracts or subcontracts exceeding $100,000, the Federal
awarding agency may accept the bonding policy and requirements of the recipient,
provided the Federal awarding agency has made a determination that the Federal
Government's interest is adequately protected. If such a determination has not been
made, the minimum requirements shall be as follows.
(1) A bid guarantee from each bidder equivalent to five percent of the bid price. The "hid guarantee"
shall consist of a firm commitment such as a bid bond, certified check, or other negotiable
instrument accompanying a bid as assurance that the bidder shall, upon acceptance of his bid,
execute such contractual documents as may be required within the time specified.
(2) 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 obligations under such contract.
(3) A payment bond on the part of the contractor for 100 percent of the contract price.
A "payment bond" is one executed in connection with a contract to assure
payment as required by statute of all persons supplying labor and material in the
execution of the work provided for in the contract.
(4) Where bonds are required in the situations described herein, the bonds shall be
obtained from companies holding certificates of authority as acceptable sureties
pursuant to 31 CFR part 223, "Surety Companies Doing Business with the United
States".
(d) All negotiated contracts (except those for less than the small purchase threshold)
awarded by recipients shall include a provision to the effect that the recipient, the
Federal awarding agency, the Comptroller General of the United States, or any of
their duly authorized representatives, shall have access to any books, documents,
papers and records of the contractor which are directly pertinent to a specific program
for the purpose of making audits, examinations, excerpts and transcriptions.
(e) All contracts, including small purchases, awarded by recipients and their contractors
shall contain the procurement provisions of Appendix A to this Circular, as
applicable.
Reports and Records
__.50 Purpose of reports and records. Sections .51 through .53 set forth the procedures
for monitoring and reporting on the recipient's financial and program performance and
the necessary standard reporting forms. They also set forth record retention requirements.
.51 Monitoring and reporting program performance.
(a) Recipients are responsible for managing and monitoring each project, program, sub-
award, function or activity supported by the award. Recipients shall monitor sub-
awards to ensure sub-recipients have met the audit requirements as delineated in
Section .26.
(b) The Federal awarding agency shall prescribe the frequency with which the performance reports shall
be submitted. Except as provided in Paragraph .51(f), performance reports shall not be required
n 1 than quarterlyor, less frequently than annually. Annual reports shall be due 90
more frequently q Y
q Y
calendar days after the grant year; quarterly or semi-annual reports shall be due 30 days after the
reporting period. The Federal awarding agency may require annual reports before the anniversary
dates of multiple year awards in lieu of these requirements. The final performance reports are due 90
calendar days after the expiration or termination of the award.
(c) If inappropriate, a final technical or performance report shall not be required after completion of the
project.
(d) When required, performance reports shall generally contain, for each award,brief information on each
of the following.
(1) A comparison of actual accomplishments with the goals and objectives
established for the period, the findings of the investigator, or both. Whenever
appropriate and the output of programs or projects can be readily quantified, such
quantitative data should be related to cost data for computation of unit costs.
(2) Reasons why established goals were not met, if appropriate.
(3) Other pertinent information including, when appropriate, analysis and explanation
of cost overruns or high unit costs.
(e) Recipients shall not be required to submit more than the original and two copies of
performance reports.
(f) Recipients shall immediately notify the Federal-awarding agency of developments
that have a significant impact on the award-supported activities. Also, notification
shall be given in the case of problems, delays, or adverse conditions, which materially
impair the ability to meet the objectives of the award. This notification shall include
a statement of the action taken or contemplated, and any assistance needed to resolve
the situation.
(g) $
Federal awardingagencies may make site visits, as needed.
(h) Federal awarding agencies shall comply with clearance requirements of 5 CFR part
1320 when requesting performance data from recipients.
.52 Financial reporting.
(a) The following forms or such other forms as may be approved by OMB are authorized
for obtaining financial information from recipients.
(1) SF-269 or SF-269A,Financial Status Report.
(i) Each Federal awarding agency shall require recipients to use the SF-269 or
SF-269A to report the status of funds for all non-construction projects or
programs. A Federal awarding agency may, however, have the option of not
requiring the SF-269 or SF-269A when the SF-270, Request for Advance or
Reimbursement, or SF-272, Report of Federal Cash Transactions, is
determined to provide adequate information to meet its needs, except that a
final SF-269 or SF-269A shall be required at the completion of the project
when the SF-270 is used only for advances.
(ii) The Federal awarding agency shall prescribe whether the report shall be on a
cash or accrual basis. If the Federal awarding agency requires accrual
information and the recipient's accounting records are not normally kept on
the accrual basis, the recipient shall not be required to convert its accounting
system, but shall develop such accrual information through best estimates
based on an analysis of the documentation on hand.
(iii)The Federal awarding agency shall determine the frequency of the Financial
Status Report for each project or program, considering the size and
complexity of the particular project or program. However, the report shall not
be required more frequently than quarterly or less frequently than annually. A
final report shall be required at the completion of the agreement.
(iv)The Federal awarding agency shall require recipients to submit the SF-269 or
SF-269A (an original and no more than two copies) no later than 30 days after
the end of each specified reporting period for quarterly and semi-annual
reports, and 90 calendar days for annual and final reports. Extensions of
reporting due dates may be.approved by the Federal awarding agency upon
request of the recipient.
(2) SF-272,Report of Federal Cash Transactions.
(i) When funds are advanced to recipients the Federal awarding agency shall
require each recipient to submit the SF-272 and, when necessary, its
continuation sheet, SF-272a. The Federal awarding agency shall use this
report to monitor cash advanced to recipients and to obtain disbursement
information for each agreement with the recipients.
(ii) Federal awarding agencies may require forecasts of Federal cash requirements
in the "Remarks" section of the report.
(iii)When practical and deemed necessary, Federal awarding agencies may require
recipients to report in the "Remarks" section the amount of cash advances
received in excess of three days. Recipients shall provide short narrative
explanations of actions taken to reduce the excess balances.
(iv)Recipients shall be required to submit not more than the original and two
copies of the SF-272 15 calendar days following the end of each quarter. The
Federal awarding agencies may require a monthly report from those recipients
receiving advances totaling $1 million or more per year.
(v) Federal awarding agencies may waive the requirement for submission of the
SF-272 for any one of the following reasons: (1) When monthly advances do
not exceed $25,000 per recipient, provided that such advances are monitored.
through other forms contained in this section; (2) If, in the Federal awarding
agency's opinion, the recipient's accounting controls are adequate to minimize
excessive Federal advances; or, (3) When the electronic payment mechanisms
provide adequate data.
(b) When the Federal awarding agency needs additional information or more frequent
reports, the following shall be observed.
(1) When additional information is needed to comply with legislative requirements, Federal awarding
agencies shall issue instructions to require recipients to submit such information under the
"Remarks" section of the reports.
(2) When a Federal awarding agency determines that a recipient's accounting system
does not meet the standards in Section .21, additional pertinent information to
further monitor awards may be obtained upon written notice to the recipient until
such time as the system is brought up to standard. The Federal-awarding agency,
in obtaining this information, shall comply with report clearance requirements of
5 CFR part 1320.
(3) Federal awarding agencies are encouraged to shade out any line item on any
report if not necessary.
(4) Federal awarding agencies may accept the identical information from the
recipients in machine-readable format or computer printouts or electronic outputs
in lieu of prescribed formats.
(5) Federal awarding agencies may provide computer or electronic outputs to recipients when such
expedites or contributes to the accuracy of reporting.
.53 Retention and access requirements for records.
(a) This section sets forth requirements for record retention and access to records for
awards to recipients. Federal awarding agencies shall not impose any other record
retention or access requirements upon recipients. •
(b) Financial records, supporting documents, statistical records, and all other records
pertinent to an award shall be retained for a period of three years from the date of
submission of the final expenditure report or, for awards that are renewed quarterly or
annually, from the date of the submission of the quarterly or annual financial report,
as authorized by the Federal awarding agency. The only exceptions are the
following.
(1) If any litigation, claim, or audit is started before the expiration of the 3-year period, the records
shall be retained until all litigation, claims or audit findings involving the records have been
resolved and final action taken.
(2) Records for real property and equipment acquired with Federal funds shall be
retained for 3 years after final disposition.
(3) When records are transferred to or maintained by the Federal awarding agency,
the 3-year retention requirement is not applicable to the recipient.
(4) Indirect cost rate proposals, cost allocations plans, etc. as specified in Paragraph
_.53(g).
(c) Copies of original records may be substituted for the original records if authorized by
the Federal awarding agency.
(d) The Federal awarding agency shall request transfer of certain records to its custody
from recipients when it determines that the records possess long term retention value.
However, in order to avoid duplicate record keeping, a Federal awarding agency may
make arrangements for recipients to retain any records that are continuously needed
for joint use.
(e) The Federal awarding agency, the Inspector General, Comptroller General of the
United States, or any of their duly authorized representatives, have the right of timely
and unrestricted access to any books, documents, papers, or other records of
recipients that are pertinent to the awards, in order to make audits, examinations,
excerpts, transcripts and copies of such documents. This right also includes timely
and reasonable access to a recipient's personnel for the purpose of interview and
discussion related to such documents. The rights of access in this paragraph are not
limited to the required retention period, but shall last as long as records are retained.
(f) Unless required by statute, no Federal awarding agency shall place restrictions on
recipients that limit public access to the records of recipients that are pertinent to an
award, except when the Federal awarding agency can demonstrate that such records
shall be kept confidential and would have been exempted from disclosure pursuant to
the Freedom of Information Act (5 USC 552) if the records had belonged to the
Federal awarding agency.
(g) Indirect cost rate proposals, cost allocations plans, etc. Paragraphs (g)(1) and (g)(2)
apply to the following types of documents, and their supporting records: indirect cost
rate computations or proposals, cost allocation plans, and any similar accounting
computations of the rate at which a particular group of costs is chargeable (such as
computer usage charge-back rates or composite fringe benefit rates).
(1) If submitted for negotiation. If the recipient submits to the Federal awarding agency or the sub-
recipient submits to the recipient the proposal, plan, or other computation to form the basis for
negotiation of the rate, then the 3-year retention period for its supporting records starts on the date
of such submission.
(2) If not submitted for negotiation. If the recipient is not required to submit to the
Federal awarding agency or the sub-recipient is not required to submit to the
recipient the proposal, plan, or other computation for negotiation purposes, then
the 3-year retention period for the proposal, plan, or other computation and its
supporting records starts at the end of the fiscal year (or other accounting period)
covered by the proposal, plan, or other computation.
Termination and Enforcement
.60 Purpose of termination and enforcement. Sections .61 and .62 set forth uniform
suspension, termination and enforcement procedures.
.61 Termination.
(a) Awards may be terminated in whole or in part only if(1), (2) or (3) apply.
(I) By the Federal awarding agency, if a recipient materially fails to comply with the terms and
conditions of an award.
(2) By the Federal awarding agency with the consent of the recipient, in which case the two parties
shall agree upon the termination conditions, including the effective date and, in the case of partial
termination,the portion to be terminated.
(3) By the recipient upon sending to the Federal awarding agency 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 determines in the case of partial termination that the reduced or
modified portion of the grant will not accomplish the purposes for which the grant
was made, it may terminate the grant in its entirety under either Paragraphs (a)(1)
or(2).
(b) If costs are allowed under an award, the responsibilities of the recipient referred to in
Paragraph .71(a), including those for property management as applicable, shall be
considered in the termination of the award, and provision shall be made for
continuing responsibilities of the recipient after termination, as appropriate.
.62 Enforcement.
(a) Remedies for noncompliance. If a recipient materially''fails to comply with the terms
and conditions of an award, whether stated in a Federal statute, regulation, assurance,
application, or notice of award, the Federal awarding agency may, in addition to
imposing any of the special conditions outlined in Section .14, take one or more
of the following actions, as appropriate in the circumstances.
(1) Temporarily withhold cash payments pending correction of the deficiency by the recipient or more
severe enforcement action by the Federal awarding agency.
(2) Disallow (that is, deny both use of funds and any applicable matching credit for)
all or part of the cost of the activity or action not in compliance.
(3) Wholly or partly suspend or terminate the current award.
(4) Withhold further awards for the project or program.
(5) Take other remedies that may be legally available.
(b) Hearings and appeals. In taking an enforcement action, the awarding agency shall
provide the recipient an opportunity for hearing, appeal, or other administrative
proceeding to which the recipient is entitled under any statute or regulation applicable
to the action involved.
(c) Effects of suspension and termination. Costs of a recipient resulting from obligations
incurred by the recipient during a suspension or after termination of an award are not
allowable unless the awarding agency expressly authorizes them in the notice of
suspension or termination or subsequently. Other recipient costs during suspension or
after termination, which are necessary and not reasonably avoidable are allowable if
(1) and (2)apply.
(1) The costs result from obligations, which were properly incurred by the recipient before the
effective date of suspension or termination, are not in anticipation of it, and in the case of a
termination,are non-cancellable.
(2) The costs would be allowable if the award were not suspended or expired
normally at the end of the funding period in which the termination takes effect.
(d) Relationship to debarment and suspension. The enforcement remedies identified in
this section, including suspension and termination, do not preclude a recipient from
being subject to debarment and suspension under EO's 12549 and 12689 and the
Federal awarding agency implementing regulations (see Section .13).
SUBPART D-After-the-Award Requirements
.70 Purpose. Sections .71 through .73 contain closeout procedures and other
procedures for subsequent disallowances and adjustments.
.71 Closeout procedures.
(a) Recipients shall submit, within 90 calendar days after the date of completion of the
award, all financial, performance, and other reports as required by the terms and
conditions of the award. The Federal awarding agency may approve extensions when
requested by the recipient.
(b) Unless the Federal awarding agency authorizes an extension, a recipient shall
liquidate all obligations incurred under the award not later than 90 calendar days after
the funding period or the date of completion as specified in the terms and conditions
of the award or in agency implementing instructions.
(c) The Federal awarding agency shall make prompt payments to a recipient for
allowable reimbursable costs under the award being closed out.
(d) The recipient shall promptly refund any balances of unobligated cash that the Federal
awarding agency has advanced or paid and that is not authorized to be retained by the
recipient for use in other projects. OMB Circular A-129 governs unreturned amounts
that become delinquent debts.
(e) When authorized by the terms and conditions of the award, the Federal awarding
agency shall make a settlement for any upward or downward adjustments to the
Federal share of costs after closeout reports are received.
(f) The recipient shall account for any real and personal property acquired with Federal
funds or received from the Federal Government in accordance with Sections .31
through .37.
(g) In the event a final audit has not been performed prior to the closeout of an award, the
Federal awarding agency shall retain the right to recover an appropriate amount after
fully considering the recommendations on disallowed costs resulting from the final
audit.
.72 Subsequent adjustments and continuing responsibilities.
(a) The closeout of an award does not affect any of the following.
(1) The right of the Federal awarding agency to disallow costs and recover funds on
the basis of a later audit or other review.
(2) The obligation of the recipient to return any funds due as a result of later refunds.
corrections, or other transactions:
(3) Audit requirements in Section .26.
(4) Property management requirements in Sections .31 through .37.
(5) Records retention as required in Section .53.
(b) After closeout of an award, a relationship created under an award may be modified or ended in whole
or in part with the consent of the Federal awarding agency and the recipient, provided the
responsibilities of the recipient referred to in Paragraph. .73(a), including those for property
management as applicable, are considered and provisions made for continuing responsibilities of the
recipient,as appropriate.
.73 Collection of amounts due.
(a) Any funds paid to a recipient in excess of the amount to which the recipient finally determined to he
entitled under the terms and conditions of the award constitute a debt to the Federal Government. If
not paid within a reasonable period after the demand for payment, the Federal awarding agency may
reduce the debt by(1),(2)or(3).
(1) Making an administrative offset against other requests for reimbursements.
(2) Withholding advance payments otherwise due to the recipient.
(3) Taking other action permitted by statute.
(b) Except as otherwise provided by law, the Federal awarding agency shall charge interest on an overdue
debt in accordance with 4 CFR Chapter II, "Federal Claims Collection Standards".
Appendix A
Contract Provisions
All contracts, awarded by a recipient including small purchases, shall contain the following
provisions as applicable:
1. Equal Employment Opportunity - All contracts shall contain a provision requiring
compliance with E.01 11246, "Equal Employment Opportunity", as amended by EO. 11375,
"Amending Executive Order 11246 Relating to Equal Employment Opportunity", and as
supplemented by regulations at 41 CFR part 60, "Office of Federal Contract Compliance
Programs, Equal Employment Opportunity, Department of Labor".
2. Copeland "Anti-Kickback" Act (18 USC 874 and 40 USC 276c) - All contracts and sub-
grants in excess of$2000 for construction or repair awarded by recipients and sub-recipients
shall include a provision for compliance with the Copeland "Anti-Kickback" Act (18 USC
874), as supplemented by Department of Labor regulations (29 CFR part 3, "Contractors and
Subcontractors on Public Building or Public Work Financed in Whole or in Part by Loans or
Grants from the United States"). The Act provides that each contractor or sub-recipient shall
be prohibited from inducing, by any means, any person employed in the construction,
completion, or repair of public work, to give up any part of the compensation to which he is
otherwise entitled. The recipient shall report all suspected or reported violations to the
Federal awarding agency.
3. Davis-Bacon Act, as amended (40 USC 276a to a-7) - When required by Federal program
legislation, all construction contracts awarded by the recipients and sub-recipients of more
than $2000 shall include a provision for compliance with the Davis-Bacon Act (40 USC 276a
to a-7) and as supplemented by Department of Labor regulations (29 CFR part 5, "Labor
Standards Provisions Applicable to Contracts Governing Federally Financed and Assisted
Construction"). Under this Act, contractors shall be required to pay wages to laborers and
mechanics at a rate not less than the minimum wages specified in a wage determination made
by the Secretary of Labor. In addition, contractors shall be required to pay wages not less
than once a week. The recipient shall place a copy of the current prevailing wage
determination issued by the Department of Labor in each solicitation and the award of a
contract shall be conditioned upon the acceptance of the wage determination. The recipient
shall report all suspected or reported violations to the Federal awarding agency.
4. Contract Work Hours and Safety Standards Act (40 USC 327-333) - Where applicable,
all contracts awarded by recipients in excess of $2000 for construction contracts and in
excess of $2500 for other contracts that involve the employment of mechanics or laborers
shall include a provision for compliance with Sections 102 and 107 of the Contract Work
Hours and Safety Standards Act (40 USC 327-333), as supplemented by Department of
Labor regulations (29 CFR part 5). Under Section 102 of the Act, each contractor shall be
required to compute the wages of every mechanic and laborer on the basis of a standard
work-week of 40 hours. Work in excess of the standard work week is permissible provided
that the worker is compensated at a rate of not less than 1 '/2 times the basic rate of pay for all
hours worked in excess of 40 hours in the work week. Section 107 of the Act is applicable to
construction work and provides that no laborer or mechanic shall be required to work in
surroundings or under working conditions which are unsanitary, hazardous or dangerous.
These requirements do not apply to the purchases of supplies or materials or articles
ordinarily available on the open market, or contracts for transportation or transmission of
intelligence.
5. Rights to Inventions Made Under a Contract or Agreement - Contracts or agreements for
the performance of experimental, developmental, or research work shall provide for the
rights of the Federal Government and the recipient in any resulting invention in accordance
with 37 CFR part 401, "Rights to Inventions Made by Nonprofit Organizations and Small
Business Firms Under Government Grants, Contracts and Cooperative Agreements", and
any implementing regulations issued by the awarding agency.
6. Clean Air Act (42 USC 7401 et seq.) and the Federal Water Pollution Control Act (33
USC 1251 et seq.), as amended - Contracts and sub-grants of amounts in excess of$100,000
shall contain a provision that requires the recipient to agree to comply with all applicable
standards, orders or regulations issued pursuant to the Clean Air Act (42 USC 7401 et seq.)
and the Federal Water Pollution Control Act as amended (33 USC 1251 et seq.). Violations
shall be reported to the Federal awarding agency and the Regional Office of the
Environmental Protection Agency(EPA).
7. Byrd Anti-Lobbying Amendment (31 USC 1352) - Contractors who apply or bid for an
award of$100,000 or more shall file the required certification. Each tier certifies to the tier
above that it will not and has not used Federal appropriated funds to pay any person or
organization for influencing or attempting to influence an officer or employee of any agency,
a member of Congress, officer or employee of Congress, or an employee of a member of
Congress in connection with obtaining any Federal contract, grant or any other award
covered by 31 USC 1352. Each tier shall also disclose any lobbying with non-Federal funds
that takes place in connection with obtaining any Federal award. Such disclosures are
forwarded from tier to tier up to the recipient.
8. Debarment and Suspension (EO's 12549 and 12689) - No contract shall be made to parties
listed on the General Services Administration's List of Parties Excluded from Federal
Procurement or Non-procurement Programs in accordance with EO's 12549 and 12689,
"Debarment and Suspension". This list contains the names of parties debarred, suspended, or
otherwise excluded by agencies, and contractors declared ineligible under statutory or
regulatory authority other than EO 12549. Contractors with awards that exceed the small
purchase threshold shall provide the required certification regarding its exclusion status and
that of its principal employees.
•
•
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EXHIBIT G
Community Development Block Grant Program Handbook 6500
Entitlement Grant Regulations September 1988
"Program income" means gross income received by the Recipient or a Subrecipient directly
generated from the uses of CDBG funds. When such income is generated by an activity that is
only partially assisted with CDBG funds, the income shall be prorated to reflect the percentage
of CDBG funds used.
(1) Program income includes, but is not limited to the following:
(i) Proceeds from the disposition by sale or long term lease of real property
purchased or improved with CDBG funds;
(ii) Proceeds from the disposition of equipment purchased with CDBG funds;
(iii) Gross income from the use or rental of real or personal property acquired by
the Recipient or a Subrecipient with CDBG funds, less the costs incidental to
the generation of such income;
(iv) Gross income from the use or rental of real property owned by the Recipient
or a Subrecipient that was constructed or improved with CDBG funds, less the
costs incidental to the generation of such income;
(v) Payments of principal and interest on loans made using CDBG funds;
(vi) Proceeds from the sale of loans made with CDBG funds;
(vii) Proceeds from the sale of obligations secured by loans made with CDBG
funds;
(viii) Interest earned on funds held in a revolving fund account;
(ix) Interest earned on program income pending disposition of such income; and
(x) Funds collected through special assessments made against properties owned
and occupied by households not of low- and moderate-income, where such
assessments are used to recover all or part of the CDBG portion of a public
improvement.
(2) Program income does not include interest earned (except for interest described in
§570.513) on cash advances from the US Treasury. Such interest shall be remitted to
HUD for transmittal to the US Treasury and will not be reallocated
under Section
106(c) or (d) of the Act. Examples of other receipts that are not considered program
income are proceeds from fundraising activities carried out by Subrecipients
receiving CDBG assistance; funds collected through special assessments used to
recover the non-CDBG portion of a public improvement; and proceeds from the
disposition of real property acquired or improved with CDBG funds when such
disposition occurs after the applicable time period specified in §570.503(b)(8) for
Subrecipient-controlled property or §570.505 for Recipient-controlled property.
Exhibit H
CDBG PROGRAM
SUB-RECIPIENT UNDERWRITING GUIDELINES
CITY OF OMAHA DEFERRED PAYMENT LOANS
Effective Date: March 20, 1998
Revised: March 15, 2000
These Underwriting Guidelines provide a general overview of the City of Omaha requirements applicable
to Deferred Payment Loans for homes purchased through sub-recipients including, but not limited to,
Holy Name Housing Corporation, South Omaha Affordable Housing Corporation; Housing and
Neighborhood Developers, Inc. (formerly known as United Ministry of Northeast Omaha, Inc), Omaha
100, Inc.; New Community Development Corporation; Omaha Economic Development Corporation and
United Minority Contractor's Association of Nebraska. While it is not possible to mention all
requirements, these guidelines answer most questions concerning the City's Deferred Payment Loan.
A. PURPOSE
The purpose of the Planning Department's Community Development Division is to promote the
growth, development and revitalization of the City of Omaha through the elimination of slums and
blight, to assist low- and moderate-income persons and families in attaining decent, affordable
housing and to create job opportunities for lower-income persons through economic development
activities.
This is accomplished by 1) formulating and implementing plans and programs designed to revitalize
neighborhoods, commercial areas an industrial areas; upgrade the housing stock in the inner city; and
create homeownership opportunities; 2) administering home renovation, home construction, economic
developing, real estate development and revitalization programs and activities; and 3) providing
services and improved service facilities for housing counseling, home maintenance, homelessness,job
training, education, elderly person, handicapped and other socio-economic assistance activities.
B. DEFINITIONS
In order to provide guidance and consistency in providing Deferred Payment Loans to homebuyers,
the following definitions shall apply:
1. Borrower — shall mean one or more persons purchasing a property and any other persons co-
signing on the promissory note.
2. Debt-to-Income Ratio (DIR)—shall mean the monthly total of all mortgage payments, real estate
taxes, special assessments, property insurance premiums and liabilities (excluding utilities, federal
income taxes, state income taxes and social security payments) divided by the gross monthly
income. The maximum DIR shall be 42%. In computing the DIR, installment debts extending ten
months or more and all revolving accounts shall be considered.
3. Deferred Payment Loan (DPL) — shall mean a loan without interest of CDBG funds in an
amount not to exceed the amount approved by the City Council for rehabilitated and a newly
constructed property, made subject to the terms, conditions and provisions of the loan agreement
under which said loan is made, secured by no less than a second mortgage/deed of trust on
individual property, which shall provide, inter-alia, that same shall become due and payable
without interest upon the sale or transfer of ownership of the property, or portion thereof, or
1 Rev. 3/15/2000
interest therein by the Owner within five (5) years from the date of loan closing for a rehabilitated
property and ten(10) years from the date of loan closing on a newly constructed property.
After 5 years on the rehabilitated properties and 10 years on newly constructed properties, the
Deferred Payment loan amount will depreciate 50% with the remaining depreciated balance due
upon sale or transfer of the property. Following the initial depreciation, the Owner may choose to
repay the 50% DPL balance over a period of time. Upon written request by the Owner to repay
the DPL balance, the Planning Department will determine the terms and conditions or repayment.
Deferred Payment Loan amounts may not exceed the following:
a. New Property: Median Income DPL Amount
80% and Below $35,000.00
81%-110% $25,000.00
111%-120% $20,000.00
Over 120% -0-
b. Rehabilitated Property: Median Income DPL Amount
80% and Below $15,000.00
Over 80% -0-
4. Employment History — shall mean a verifiable and continuous two-year work history, or a
verifiable source of other income including, but not limited to, social security, pension, annuities,
child support, alimony, etc. In some instances, education may be substituted for employment if
Borrower has been employed at current job for six months.
5. Household — shall mean all persons who will occupy the property. The occupants may be a
single-family, one person living alone, two or more families living together or any other group of
related or unrelated persons who share living arrangements and includes:
a. any dependent child under the age of 19. If a child is claimed for income tax (IRS) purposes,
the City will consider the child a dependent.
b. any dependent member over the age of 62 who has lived in the household full time for a
minimum of 6 months immediately prior to application date and will continue to live in the
household full time, does not own other property and is dependent upon the borrower.
6. Housing — Income Ratio (HIR) — shall mean the monthly total of all mortgage payments, real
estate taxes, special assessments and property insurance premiums divided by the gross monthly
income. The maximum HIR shall be 33% or the percentage established by the lender providing
the first mortgage financing.
7. Income—(See attached sheet for computing annual income) Annual income shall include:
a. Wages, salaries, tips, commissions, etc.,
b. Self-employment income from owned non-farm business, including proprietorships and
partnerships,
c. Farm Self-employment income
d. Interest, dividends, net rental income or income from estates or trusts,
e. Social security or railroad retirement,
f. Supplemental security income, Aid to Families with Dependent Children or other public
assistance or public welfare programs,
g. Retirement, survivor or disability pensions,
2 Rev. 3/15/2000
h. Any other sources of income received regularly including Veteran's (VA) payments,
unemployment compensation, child support and alimony, and
i. Income from assets as shown below:
1) amounts in savings or checking accounts,
2) stocks, bonds, savings certificates, money market funds and other investment accounts,
3) Equity in real property or other capital investments. Equity is the estimated current market
value of the asset less the unpaid balance on all loans secured by the asset and reasonable
costs (such as broker fees) that would be incurred in selling the asset. Do not include
equity in principle residence (home equity).
4) The cash value of trusts that are available to the household,
5) IRA, Keogh an similar retirement savings accounts, even though withdrawal would result
in a penalty,
6) Contributions to company retirement/pension funds that can be withdrawn without retiring
or terminating employment.,
7) Assets which, although owned by more than one person, allow unrestricted access by the
applicant,
8) Lump sum receipts such as inheritances, capital gains, lottery winnings, insurance
settlements and other claims,
9) Personal property held as an investment such as gems, jewelry, coin collections, antique
cars, etc.
10)Cash value of life insurance policies, and
11)Assets disposed of for less than fair market value during two years preceding certification
or re-certification.
j. Actual income from assets if total assets are $5,000 or less
k. If assets are more than $5,000, the greater of actual income from assets or total assets times
passbook rate.
1. Assets do not include:
1) Necessary personal property except personal property held as an investment such as gems,
jewelry, coin collections, antique cars, etc.,
2) Interest in Indian trust lands,
3) Assets that are a part of an active business or farming operation. NOTE: Rental
properties are considered personal assets held as an investment rather than business assets
unless real estate is the applicant's/tenant's main occupation,
4) Assets not accessible to the family and which provide no income for the family,
5) Vehicles especially equipped for the handicapped,
6) Equity in owner-occupied cooperatives and manufactured homes in which the family lives,
and
7) Equity in principle residence (home equity)
NOTE: Income averaging is not acceptable.
3 Rev. 3/15/2000
8) Median Income— shall mean the Median Income by Family Size income data as published by the
United Stated Department of Housing and Urban Development and as further updated and revised
to reflect the current or most recent income level statistics. A copy of the median incomes is
available upon request at the City of Omaha Planning Department.
9) Sub-recipient — shall mean a public or private non-profit agency, authority or organization
receiving HOME funds to undertake eligible activities.
10)Verifications — shall mean all supporting documentation obtained within the past six months for
preliminary loan approval by the City. These documents include, but are not limited to,
employment, bank deposits, credit information and property title commitments.
C. INTEREST OF THE CITY
Pursuant to Section 8.5 of the Home Rule Charter, no elected official or any officer or employee of the
City shall have a financial interest, direct or indirect, in any City Agreement. Any violation of this
section with the knowledge of the person or corporation contracting with the City shall render the
Agreement voidable by the Mayor or the City Council.
D. BANKRUPTCY
Borrowers who have filed a bankruptcy must have established a verifiable form of credit over a six-
month period commending after the Bankruptcy Court entered its Order of Discharge. A copy of the
bankruptcy document, Court Order of Discharge and a detailed letter explaining the reason for filing
bankruptcy and the circumstances surrounding it must be submitted with the initial application for
preliminary loan approval by the City.
E. INSURANCE
The Borrower must have at least a hazard insurance policy in force for one year at the time of loan
closing. The policy must have a proper endorsement naming the City of Omaha as an additional
mortgagee. Proper mortgage endorsement is available at the City of Omaha Planning Department.
F. SALE OF PROPERTY
In the event of sale of the property, the deferred payment loan must be repaid to the City of Omaha as
specified in the Promissory Note and Section B, Number 3 above.
G. LOAN ASSUMPTION
Some Homeowners who have received financial assistance from the City of Omaha for a Deferred
Payment loan to purchase their homes may, at some point, desire to transfer their homes and have
your loan assumed by a new buyer. The following criteria will apply when a homeowner desires to
sell his/her property and requests that the loan be assumed by a new buyer:
1. The family who assumes a City of Omaha Deferred Payment Loan:
a. must be creditworthy; and
b. must meet all underwriting criteria contained in these guidelines; and,
c. must agree to live in the house for the remaining term of the Deferred Payment Loan.
2. The purchase price, including the downpayment, must be negotiated and agreed upon between the
buyer and the seller.
3. The incomes of families assuming a DPL may not exceed the limits of the median family income
contained in the agreement under which the Seller's DPL was approved.
4 Rev. 3/15/2000
4. The new buyer assuming a DPL must assume liability for the balance of the loan at the time of
loan closing.
5. When an Owner of a property with a DPL wishes to transfer his/her property through an
assumption, the Owner must:
a. Secure a potential borrower who is willing to assume the DPL,
b. Negotiate a selling (purchase price with the potential buyer. The amount of the downpayment
would be paid to the Owner by the new buyer at the time of loan closing. The City of Omaha
will not negotiate with either party over the amount of this repayment.
c. Write a letter to the Sub-recipient requesting that an assessment be made of the prospective
borrower's qualifications to assume the DPL.
d. After this assessment is completed, the present Owner will be notified of the prospective
buyer's eligibility to assume the loan.
6. In the event of the death of an owner, the heirs will have the same assumption options as the
Owner.
H. CREDIT HISTORY
1. Judgments—Judgements must be paid or satisfied prior to loan approval.
2. Collection Accounts — Collection accounts should be paid or a repayment agreement must be in
effect. If a repayment agreement is in effect, the Borrower must have established a minimum of
six months payment history.
3. Divorce — In the case of a divorce, any debts remaining in both names originating prior to the
Court granting of a decree shall be considered a financial obligation against the borrower.
4. Legal Separation —Borrower that is legally separated will be subjected to the same underwriting
criteria as a married person; therefore, both signatures (husband and wife) shall be required on the
Promissory Note.
I. NON-DISCRIMINATION BASED ON HANDICAP
1. The Sub-recipient shall not discriminate or permit discrimination in violation of federal or state
laws or local ordinances because of race, color, sex, age, political or religious opinions,
affiliations, national origin, familial status or handicap.
2. The Sub-recipient shall not discriminate in admission or access to, or treatment or employment in,
its federally-assisted programs and activities. To this end, no otherwise qualified individual with a
handicap shall, solely by reason of his or her handicap, be excluded from participation in, or be
denied the benefits of, or be subjected to discrimination under this or any other City-sponsored
program or activity. The person responsible for coordinating the Planning Department's efforts to
comply with its non-discrimination policies is Marian Todd, Section 504 Coordinator, Planning
Department, Suite 1111, 1819 Farnam Street, Omaha, Nebraska 68183, (402) 444-5217, (V/TDD)
444-5150.
Persons desiring to file a complaint with the City of Omaha concerning an allegation of discrimination
shall contact the Human Relations Department at (402) 444-5025 (V/TDD 444-5055).
5 Rev. 3/15/2000
HOME PROGRAM Exhibit H
SUB-RECIPIENT UNDERWRITING GUIDELINES
CITY OF OMAHA DEFERRED PAYMENT LOANS
Effective Date: March 20, 1998
Revised: March 7,2000
These Underwriting guidelines provide a general overview of the City of Omaha requirements applicable to
Deferred Payment Loans for homes purchased through Sub-recipients including, but not limited to, Holy Name
Housing Corporation; South Omaha Affordable Housing Corporation; Omaha Inc.; Omaha 100, Inc.; New
Community Development Corporation; Omaha Economic Development Corporation and United ministry
Contractor's Association of Nebraska. While it is not possible to mention all requirements, these guidelines
answer most questions concerning the City's Deferred Payment Loan.
A. PURPOSE
The purpose of the Planning Department's Community Development Division is to promote the growth,
development and revitalization of the City of Omaha through the elimination of slums and blight; to assist
low- and moderate-income persons and families in attaining decent, affordable housing; and to create job
opportunities for lower income persons through economic development activities.
This is accomplished by:
1) formulating and implementing plans and programs designed to revitalize neighborhoods, commercial
areas and industrial areas; upgrade the housing stock in the inner city; and create homeownership
opportunities;
2) administering home renovation, home construction, economic developing, real estate development and
revitalization programs and activities; and
3) providing services and improved service facilities for housing counseling, home maintenance,
homelessness, job training, education, elderly persons, handicapped and other socio-economic
assistance activities.
B. DEFINITIONS
In order to provide guidance and consistency in providing Deferred Payment Loans to homebuyers, the
following definitions shall apply:
1. Borrower—shall mean one or more persons purchasing a property and any other persons co-signing on
the promissory note.
2. Debt-to-Income Ratio (DIR) — shall mean the monthly total of all mortgage payments, real estate
taxes, special assessments, property insurance premiums and liabilities (excluding utilities, federal
income, taxes, state taxes and social security payments) divided by the gross monthly income. The
maximum DIR shall be 42%. In computing the DIR, installment debts extending ten months or more
and all revolving accounts shall be considered.
3. Deferred Payment Loan (DPL)—shall mean a loan without interest of HOME funds in an amount not
to exceed the amount approved by the City Council for a rehabilitated and a newly constructed property,
made subject to the terms, conditions and provisions of the loan agreement under which said loan is
made, secured by no less than a second mortgage/deed of trust on an individual property, which shall
provide, inter-alia, that same shall become due and payable without interest upon the sale or transfer of
ownership of the property, or portion thereof, or interest therein by the Owner within five (5)years from
the date of loan closing for a rehabilitated property and ten(10)years from the date of loan closing on a
newly constructed property.
After 5 years on the rehabilitated properties and 10 years on newly constructed properties, the Deferred
payment loan amount will depreciate 50% with the remaining depreciated balance due upon sale or
transfer of the property. Following the initial depreciation, the Owner may choose to repay the 50%
1
DPL balance over a period of time. Upon written request by the Owner to repay the DPL balance, the
Planning Department will determine the terms and conditions of repayment.
Deferred Payment Loan amounts may not exceed the following:
a. New Property: Median Income DPL Amount
80% and Below $35,000.00
b. Rehabilitated Property Median Income DPL Amount
80% and Below $15,000.00
4. Employment History — shall mean a verifiable and continuous two-year work history, or a verifiable
source of other income including, but not limited to, social security, pension, annuities, child support,
alimony, etc. In some instances, education may be substituted for employment if borrower has been
employed at current job for six months.
5. Household — shall mean all persons who will occupy the property. The occupants may be a single-
family, one person living alone, two or more families living together or any other group of related or
unrelated persons who share living arrangements and includes:
a. any dependent child under the age of 19. If a child is claimed for income tax (IRS) purposes, the
City will consider the child a dependent.
b. any dependent member over the age of 62 who has lived in the household full time for a minimum
of 6 months immediately prior to application date and will continue to live in the household full
time, does not own other property and is dependent upon the borrower.
6. Housing-Income-Ratio (HIR) — shall mean the monthly total of all mortgage payments, real estate
taxes, special assessments and property insurance premiums divided by the gross monthly income. The
maximum HIR shall be 33% or the percentage established by the lender providing the first mortgage
financing.
7. Income—(See attached sheet for computing annual income)Annual income shall include:
a. Wages, salaries, tips, commissions, etc.,
b. Self-employment income from owned non-farm business, including proprietorships and
partnerships,
c. Farm self-employment income,
d. Interest, dividends,net rental income or income from estates or trusts,
e. Social security or railroad retirement,
f. Supplemental security income, Aid to Families with Dependent children or other public assistance
or public welfare programs,
g. Retirement, survivor or disability pensions,
h. Any other sources of income received regularly including Veterans' (VA)payments, unemployment
compensation, child support and alimony, and
i. Income from assets as shown below:
1) Amounts in savings or checking accounts,
2) Stocks,bonds, savings certificates,money market funds and other investment accounts,
3) Equity in real property or other capital investments. Equity is the estimated current market
value of the asset less the unpaid balance on all loans secured by the asset and reasonable costs
(such as broker fees) that would be incurred in selling the asset. Do not include equity in
principle residence(home equity).
2
4) The cash value of trusts that are available to the household,
5) IRA, Keogh and similar retirement savings accounts, even though withdrawal would result in a
penalty,
6) Contributions to company retirement/pension funds that can be withdrawn without retiring or
terminating employment,
7) Assets which, although owned by more than one person, allow unrestricted access by the
applicant,
8) Lump sum receipts such as inheritances, capital gains, lottery winnings, insurance settlements
and other claims,
9) Personal property held as an investment such as gems, jewelry, coin collections, antique cars,
etc.
10) Cash value of life insurance policies, or
11) Assets disposed of for less than fair market value during two years preceding certification or re-
certification.
j. Actual income from assets if total assets are$5,000 or less.
k. Assets do not include:
1) Necessary personal property except personal property held as an investment such as gems,
jewelry, coin collections, antique cars, etc.
2) Interest in Indian trust lands,
3) Assets that are a part of an active business or farming operation. NOTE: Rental properties are
considered personal assets held as an investment rather than business assets unless real estate is
the applicant's/tenant's main occupation.
4) Assets not accessible to the family and which provide no income for the family,
5) Vehicles especially equipped for the handicapped,
6) Equity in owner-occupied cooperatives and manufactured homes in which the family lives, or
7) Equity in principle residence(home equity).
NOTE: Income averaging is not acceptable.
8) Median Income — shall mean the Median Income by Family Size income data as published by the
United Stated Department of Housing and Urban Development and as further updated and revised to
reflect the current or most recent income level statistics. A copy of the median incomes is available
upon request at the City of Omaha Planning Department.
9) Sub-recipient — shall mean a public or private non-profit agency, authority or organization receiving
HOME funds to undertake eligible activities.
10) Verifications — shall mean all supporting documentation obtained within the past six months for
preliminary loan approval by the City. These documents include, but are not limited to, employment,
bank deposits, credit information and property title commitments.
C. INTEREST OF THE CITY
Pursuant to Section 8.05 of the Home Rule Charter, no elected official or any officer or employee of the
City shall have a financial interest, direct or indirect, in any City Agreement. Any violation of this section
with the knowledge of the person or corporation contracting with the City shall render the Agreement
voidable by the Mayor or the City Council.
3
D. BANKRUPTCY
Borrowers who have filed a bankruptcy must have established a verifiable form of credit over a six-month
period commending after the Bankruptcy Court entered its Order of Discharge. A copy of the bankruptcy
document, Court Order of Discharge and a detailed letter explaining the reason for filing bankruptcy and the
circumstances surrounding it must be submitted with the initial application for preliminary loan approval by
the City.
E. INSURANCE
The Borrower must have at least a hazard insurance policy in force for one year at the time of loan closing.
The policy must have a proper endorsement naming the City of Omaha as an additional mortgagee. Proper
mortgage endorsement is available at the City of Omaha Planning Department.
F. SALE OF PROPERTY
In the event of sale of the property, the deferred payment loan must be repaid to the City of Omaha as
specified in the Promissory Note and Section B,Number 3 above.
G. LOAN ASSUMPTION
Loans funded through the HOME Program are not assumable.
H. CREDIT HISTORY
1. Judgments—Judgments must be paid or satisfied prior to loan approval.
2. Collection accounts —Collection accounts should be paid or a repayment agreement must be in effect.
If a repayment agreement is in effect, the Borrower must have established a minimum of six months
payment history.
3. Divorce — In the case of a divorce, any debts remaining in both names originating prior to the Court
granting of a decree shall be considered a financial obligation against the borrower.
4. Legal Separation — Borrower that is legally separated will be subjected to the same underwriting
criteria as a married person; therefore, both signatures (husband and wife) shall be required on the
Promissory Note.
I. NON-DISCRIMINATION BASED ON HANDICAP
1. The Sub-recipient shall not discriminate or permit discrimination in violation of federal or state laws or
local ordinances because of race, color, sex, age, political or religious opinions, affiliations, national
origin, familial status or handicap.
2. The Sub-recipient shall not discriminate in admission or access to, or treatment or employment in, its
federally-assisted programs and activities. To this end, no otherwise qualified individual with a
handicap shall, solely by reason of his or her handicap, be excluded from participation in, or be denied
the benefits of, or be subjected to discrimination under this or any other City-sponsored program or
activity. The person responsible for coordinating the Planning Depaituient's efforts to comply with its
non-discrimination policies is Marian Todd, Section 504 Coordinator, Planning Depai Intent, Suite 1111,
1819 Farnam Street, Omaha,Nebraska 68183, (402)444-5217 (V/TDD)444-5150.
Persons desiring to file a complaint with the City of Omaha concerning an allegation of discrimination
shall contact the Human Relations Depaitl,ient at(402)444-5025 (V/TDD 444-5055).
4
7/ /00
General Decision Number NE000009
-- `- / '
Superseded General Decision No. NE990009
r, Gt. jNl
State: Nebraska
4Ate,fievgle,
Construction Type:
•
RESIDENTIAL '1 5 �'
County(ies) :
CASS DOUGLAS SARPY Exhibit I
RESIDENTIAL CONSTRUCTION PROJECTS (consisting of single family
homes and apartments up to and including 4 stories)
Modification Number Publication Date
0 02/11/2000
y\.) r--"N K. K
1
•
•
COUNTY(ies) :
CASS DOUGLAS SARPY
BRNE0001D 07/01/1999
Rates Fringes
BRICKLAYER 20.15 4. 95
CARP0444C 10/01/1999
Rates Fringes
CARPENTER (includes acoustical
ceiling and bait insulation) 18.01 4. 55
ELEC0022C 06/01/1999
Rates Fringes
ELECTRICIAN:
Work on 4-story apartment buildings 22.45 3 .75% + 6. 84
ELEC0022E 04/01/1999
Rates Fringes
ELECTRICIAN:
Work on single family homes
and apartments up to and
including 3 stories 14.34 3 .75% + 4.14
PLAS0538B 10/01/1999
Rates Fringes •
CEMENT MASON 18.36 2 .20
PLUM0016E 06/01/1999
Rates Fringes
PLUMBER 23.52 6.35
SUNE4003A 06/01/1984
Rates Fringes
DRYWALL:
Hanger 13 .57 2 . 10
Finisher & taper 8.64
INSULATOR 11.21
IRONWORKER 13 .00 2 . 00
LABORERS:
General 10.41 1 . 80
Mason tender 10.585 1 . 80
PAINTER 10.00 •
POWER EQUIPMENT OPERATORS:
Loader 13 .49
SHEET METAL WORKER 11.89 1 . 34
2
TRUCK DRIVER 10 .27
WELDERS - Receive rate prescribed for craft performing operation
to which welding is incidental.
Unlisted classifications needed for work not included within
the scope of the classifications listed may be added after
award only as provided in the labor standards contract clauses
(29 CFR 5.5 (a) (1) (v) ) .
In the listing above, the "SU" designation means that rates
listed under that identifier do not reflect collectively
bargained wage and fringe benefit rates. Other designations
indicate unions whose rates have been determined to be
prevailing.
WAGE DETERMINATION APPEALS PROCESS
1. ) Has there been an initial decision in the matter? This can
be:
* an existing published wage determination
* a survey underlying a wage determination
* a Wage and Hour Division letter setting forth a
position on a wage determination matter
* a conformance (additional classification and rate)
ruling
On survey related matters, initial contact, including requests
for summaries of surveys, should be with the Wage and Hour
Regional Office for the area in which the survey was conducted
because those Regional Offices have responsibility for the
Davis-Bacon survey program. If the response from this initial
contact is not satisfactory, then the process described in 2 . )
and 3. ) should be followed.
With regard to any other matter not yet ripe for the formal
process described here, initial contact should be with the Branch
of Construction Wage Determinations. Write to:
Branch of Construction Wage Determinations
Wage and Hour Division
U. S. Department of Labor
200 Constitution Avenue, N. W.
Washington, D. C. 20210
2 . ) If the answer to the question in 1 . ) is yes, then an
interested party (those affected by the action) can request
review and reconsideration from the Wage and Hour Administrator
(See 29 CFR Part 1 . 8 and 29 CFR Part 7) . Write to:
3
*
VA
Wage and Hour Administrator
U.S. Department of Labor
200 Constitution Avenue, N. W.
Washington, D. C. 20210
The request should be accompanied by a full statement of the
interested party's position and by any information (wage payment
data, project description, area practice material, etc. ) that the
requestor considers relevant to the issue.
3 . ) If the decision of the Administrator is not favorable, an
interested party may appeal directly to the Administrative Review
Board (formerly the Wage Appeals Board) . Write to:
Administrative Review Board
U. S. Department of Labor
200 Constitution Avenue, N. W.
Washington, D. C. 20210
4. ) All decisions by the Administrative Review Board are final.
END OF GENERAL DECISION
•
•
���ENTo U.S. DEPARTMENT OF HOUSING ANL URBAN DEVELOPMENT
.t I q' eft l yOGN KANSAS/MISSOURI STATE OFFICE
0 ° i Z Gateway Tower II, Room 200
* [la -J * 400 State Avenue
'yo II II II Kansas City, KS 66101-2406
Q� HUD Home Page: www.hud.gov
9e'1N DEVE�O
Apri123, 2001
Sharon Oamek
Planning Department, llt'1 Floor
1819 Farnam Street
Omaha/Douglas Civic Center
Omaha, NE
Dear Ms . Oamek:
SUBJECT : Fontenelle View Project, 2000-2
Enclosed is a copy of the Department of Housing and
Urban Development ' s Form 4230A, Report of Additional
Classification and Rate, dated April 23, 2001, approving
the classification and wage rate as listed. This form
shall be attached to and constitute a part of the
Department of Labor' s wage determination number NE000009
dated February 11, 2000 .
This report has been forwarded to the Department
of Labor for final approval . Should the Department of
Labor take exception to the established rate, a formal
notification will be transmitted to you. Should you
have any questions, you may contact me or Barbara C .
McGonagle at 913-551-6883 .
Sincerely,
/- Frank C. Bustamante
Director, Labor Relations
Enclosure
U 5 DEPARTMENT OF N 'NG AND URBAN DEVELOPMENT 'OATC Oa wLPORT
. REPORT OF ADDITION.__ CLASSIFICATION AND RATE
• ., (Soo Instructions on Revorso) APRIL 23, 2001
—' ,:,..I•.,.t,...,1;rx cur„,. (..s. Depn'tmrnr of Labnr) PROM, /hnmr and f.nrnunn n(HIM Offtc•r) •
U.S. Department of Labor U.S. Department of Housing and Urban Development
Employment Standards Administration, Wage and Hour Kansas/Missouri State Office, Gateway Tower II '
Branch of Construction Contract Wage Determination 400 State Avenue, Room S00, Labor Relations
Washington, D.C._ 20210 _ Kansas City, KS 66101-2406 (913) 551-6883
•
..A..tE OP PROJECT PROJECT NUMBER
Fontenell View Project 2000—$ CDBG
LOCATION or PROJECT (City, County and State)
•
Omaha, Douglas, Nebraska
DESCRIPTION OF 'VORA -
•
Rehab
In order to complete the Project. it is necessary to establish wage rates for the following classifications not included in the U.S
pepartment of Labor Wage Determination Decision No. NE000009 Dated L-11-00
CLASSIFtCATIONISt BASIC HOURLY RATEISi i FRINGE BENEFIT PAYMENTS
Residential Construction:
Roofer $13-23
•
Gutter Installation $13.23
Vinyl Siding Installation $13.23
,
'AME. ADDRESS •,"D -ZIF CODE OF LASCP ORGANIZATION NAt.tE AOGRE55 AND ZIP CODE OF CONTRACTOR
John Higgins Weatherguard, Inc.
Nonunion 1710 Binfield Street
Elkhorn, NE 68022 0
TEE pc t.A9CR ORGAN!ZATICN'S R EPRESENTATIvE. TITLE CC CONTRACTOR'S REPRESENTATIVE
Owner
Wi Supporting documents attached.
f2The interested part:es. including the employees or their atshorized representatives, agree on the classification
and wage rate
0 The interested parties. including the employees or their authorized representatives, cannot agree on the proper
t classification and wage rate. A determination of she question by the Secretary of Labor is therefore requested
Available information and recommendations are attached.
•
1 CONTRACT AWARD DATE: /7 �O Q
•
APPRC :ED
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Mt.;•' .i230:. -.t T3t PREVIOUS ED,TIOnt us ojaOL ETE
. 0ENTox. U.S. DEPARTMENT OF HOUSING ANL .,RBAN DEVELOPMENT
• ti
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N KANSAS/MISSOURI STATE OFFICE
Gateway Tower II, Room 200
400 State Avenue
2oG I) II I! ��= Kansas City, KS 66101-2406
egN oEVE�o HUD Home Page: www.hud.gov
April23, 2001
Sharon Oamek
Planning Department, ilt Floor
1819 Farnam Street
Omaha/Douglas Civic Center
Omaha, NE
Dear Ms . Oamek:
SUBJECT : Fontenelle View Project, 2000-2
Enclosed is a copy of the Department of Housing and
Urban Development ' s Form 4230A, Report of Additional
Classification and Rate, dated April 23, 2001, approving
the classification and wage rate as listed. This form
shall be attached to and constitute a part of the
Department of Labor' s wage determination number NE000009
dated February 11, 2000 .
This report has been forwarded to the Department
of Labor for final approval . Should the Department of
Labor take exception to the established rate, a formal
notification will be transmitted to you. Should you
have any questions, you may contact me or Barbara C.
McGonagle at 913-551-6883 .
Sincerely,
Frank C. Bustamante
Director, Labor Relations
Enclosure •
3
U S DEPARTMENT OF Y ND AND URBAN DEVELOPMENT DATE OF REPORT
' .1 7
REPORT OF ADD1TIOtk.__ CLASSiFICAT1ON AND RATE .
(S•• Instructions on R•v•rs•) APRIL 23, 2001
r p ILI•...t•r•.a. ,(t•;.tnn.• (t/ Ire, .>7 lernrtmrnr n f.abnr) FROM /home and l.nrnttm, nl Milt OfJrcrl ,
U.S. Department of Labor U.S. Department of Housing and Urban Development
Employment Standards Administration, Wage and Hour Kansas/Missouri State Office, Gateway Tower II '
Branch of Construction Contract Wage Determination 400 State Avenue, Room 500, Labor Relations
Washington, D.C._ 20210 _ Kansas City, KS 66101-2406 (913) 551-6883
^••ME OF PROJECT PROJECT NUMBER
Fontenell View Project 2000-y', CDBG
:.oc•TION or PROJECT (City, County and Stale)
•
Omaha, Douglas, Nebraska .
OESCRIPTJON OF WORK .
•
Rehab
In order to complete the Project. it is necessary to establish wage rates for the following classifications not included in the U.S.
department of Labor Wage Determination Decision No. iNE00000 I Dated 2-11-00
CLASSIFtCATiCN,SI L BASIC HOURLY RATE:Si ( FRINGE BENEFIT PAYMENTS
•
Residential Construction:
Roofer $13.23
•
Gutter Installation $13.23
•
Vinyl Siding Installation $13.23
....aw,C. ACCRESS AN ZIP COCC OF LABOR ORGANIZATION NAME AOCRES5 ANO ZIP COCE OF CONTRACTOR
John Higgins Weatherguard, Inc.
Nonunion 1710 Binfield Street
Elkhorn, NE 68022
- TEE OF L..ecm ORGAN!ZATION'S REPRESENTATIVE, TITLE OF CONTRACTOR'S REPRESENTATIVE
Owner
Supporting document; attached.
EThe interested pan:es. Including the employees or their atahorized representatives• agree on the classification
and wage rate
0 The interested parties. including the employees or their authorized representatives, cannot agree on the proper
`
classification and wage rate. A determination of she question by the Secretary of Labor is therefore requested
Available information and recommendations are attached.
CONTRACT AWARD DATE: // CC G'
APPRC'•:ED
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PAEviOU3 EDITION is o4SOL ET E
//ciz
Federal Labor Standards Provisions
U. S. Department of Housing and Urban Development
Applicability
The Project or Program to which the construction work covered by this contract pertains is being
assisted by the United States of America and the following Federal Labor Standards Provisions are
included in this Contract pursuant to the provisions applicable to such Federal assistance.
A. 1. (i) Minimum Wages. All laborers and mechanics employed or working upon the site of the
work (or under the United States Housing Act of 1937 or under the Housing Act of 1949 in the
construction or development of the project), will be paid unconditionally and not less often than once
a week, and without subsequent deduction or rebate on any account (except such payroll deductions
as are permitted by regulations issued by the Secretary of Labor under the Copeland Act (29 CFR
Part 3), the full amount of wages and bona fide fringe benefits (or cash equivalents thereof) due at
time of payment computed at rates not less than those contained in the wage determination of the
Secretary of Labor which is attached hereto and made a part hereof, regardless of any contractual
relationship which may be alleged to exist between the contractor and such laborers and mechanics.
Contributions made or costs reasonably anticipated for bona fide fringe benefits under Section
1(b)(2) of the Davis-Bacon Act on behalf of laborers or mechanics are considered wages paid to
such laborers or mechanics, subject to the provisions of 29 CFR 5.5(a)(1)(iv); also; regular
contributions made or costs incurred for more than a weekly period (but not less often than quarterly)
under plans, funds, or programs, which cover the particular weekly period, are deemed to be
constructively made or incurred during such weekly period.
Such laborers and mechanics shall be paid the appropriate wage rate and fringe benefits on the
wage determination for the classification of work actually performed, without regard to skill, except
as provided in 29 CFR Part 5.5(a)(4). Laborers or mechanics performing work in more than one
classification may be compensated at the rate specified for each classification for the time actually
worked therein: Provided, That the employer's payroll records accurately set forth the time spent in
each classification in which work is performed. The wage determination (including any additional
classification and wage rates conformed under 29 CFR Part 5.5(a)(1)(ii) and the Davis-Bacon poster
(WH-1321) shall be posted at all times by the contractor and its subcontractors at the site of the work
in a prominent and accessible place where it can be easily seen by the workers.
(ii) (a) Any class of laborers or mechanics which is not listed in the wage determination and
which is to be employed under the contract shall be classified in conformance with the wage
determination, HUD shall approve an additional classification and wage rate and fringe benefits
therefore only when the following criteria have been met:
(1) The work to be performed by the classification requested is not performed by a
classification in the wage determination; and
(2) The classification is utilized in the area by the construction industry; and
(3) The proposed wage rate, including any bona fide fringe benefits, bears a reasonable
relationship to the wage rates contained in the wage determination.
(b) If the contractor and the laborers and mechanics to be employed in the classification (if
known), or their representatives, and HUD or its designee agree on the classification and wage rate
(including the amount designated for fringe benefits where appropriate), a report of the action taken
shall be sent by HUD or its designee to the Administrator of the Wage and Hour Division,
Employment Standards Administration, U.S. Department of Labor, Washington, D.C. 20210. The
Administrator, or an authorized representative, will approve, modify, or disapprove every additional
classification action within 30 days of receipt and so advise HUD or its designee or will notify HUD or
its designee within the 30-day period that additional time is necessary. (Approved by the Office of
Management and Budget under OMB control number 1215-0140.)
1 r l�
D TOrd
(c) In the event the contractor, the laborers or mechanics to be employed in the classification or
their representatives, and HUD or its designee do not agree on the proposed classification and wage
rate (including the amount designated for fringe benefits, where appropriate), HUD or its designee
shall refer the questions, including the views of all interested parties and the recommendation of
HUD or its designee, to the Administrator for determination. The Administrator, or an authorized
representative, will issue a determination within 30 days of receipt and so advise HUD or its
designee or will notify HUD or its designee within the 30-day period that additional time is necessary.
(Approved by the Office of Management and Budget under OMB Control Number 1215-0140.)
(d) The wage rate (including fringe benefits where appropriate) determined pursuant to
subparagraphs (1)(b) or (c) of this paragraph, shall be paid to all workers performing work in the
classification under this contract from the first day on which work is performed in the classification.
(iii) Whenever the minimum wage rate prescribed in the contract for a class of laborers or
mechanics includes a fringe benefit which is not expressed as an hourly rate, the contractor shall
either pay the benefit as stated in the wage determination or shall pay another bona fide fringe
benefit or an hourly cash equivalent thereof.
(iv) If the contractor does not make payments to a trustee or other third person, the contractor
may consider as part of the wages of any laborer or mechanic the amount of any costs reasonably
anticipated in providing bona fide fringe benefits under a plan or program, Provided, That the
Secretary of Labor has found, upon the written request of the contractor, that the applicable
standards of the Davis-Bacon Act have been met. The Secretary of Labor may require the
contractor to set aside in a separate account assets for the meeting of obligations under the plan or
program. (Approved by the Office of Management and Budget under OMB Control Number 1215-
0140.)
2. Withholding. HUD or its designee shall upon its own action or upon written request of an
authorized representative of the Department of Labor withhold or cause to be withheld from the
contractor under this contract or any other Federal contract with the same prime contractor, or any
other Federally-assisted contract subject to Davis-Bacon prevailing wage requirements, which is
held by the same prime contractor so much of the accrued payments or advances as may be
considered necessary to pay laborers and mechanics, including apprentices, trainees and helpers,
employed by the contractor or any subcontractor the full amount of wages required by the contract.
In the event of failure to pay any laborer or mechanic, including any apprentice, trainee or helper,
employed or working on the site of the work (or under the United States Housing Act of 1937 or
under the Housing Act of 1949 in the construction or development of the project), all or part of the
wages required by the contract, HUD or its designee may, after written notice to the contractor,
sponsor, applicant, or owner, take such action as may be necessary to cause the suspension of any
further payment, advance, or guarantee of funds until such violations have ceased. HUD or its
designee may, after written notice to the contractor, disburse such amounts withheld for and on
account of the contractor or subcontractor to the respective employees to whom they are due. The
Comptroller General shall make such disbursements in the case of direct Davis-Bacon Act contracts.
3. (i) Payrolls and basic records. Payrolls and basic records relating thereto shall be
maintained bythe contractor duringthe courseof the work s opreserved foraperiod of three years
thereafter for all laborers and mechanics working at the site of the work (or under the United States
Housing Act of 1937, or under the Housing Act of 1949, in the construction or development of the
project). Such records shall contain the name, address, and social security number of each such
worker, his or her correct classification, hourly rates of wages paid (including rates of contributions or
costs anticipated for bona fide fringe benefits or cash equivalents thereof of the types described in
Section 1(b)(2)(B) of the Davis-Bacon Act), daily and weekly number of hours worked, deductions
made and actual wages paid. Whenever the Secretary of Labor has found under 29 CFR 5.5
(a)(1)(iv) that the wages of any laborer or mechanic include the amount of any costs reasonably
anticipated in providing benefits under a plan or program described in Section 1(b)(2)(B) of the
Davis-Bacon Act, the contractor shall maintain records which show that the commitment to provide
such benefits is enforceable, that the plan or program is financially responsible, and that the plan or
program has been communicated in writing to the laborers or mechanics affected, and records which
show the costs anticipated or the actual cost incurred in providing such benefits. Contractors
employing apprentices or trainees under approved programs shall maintain written evidence of the
registration of apprenticeship programs and certification of trainee programs, the registration of the
apprentices and trainees, and the ratios and wage rates prescribed in the applicable programs.
(Approved by the Office of Management of Budget under OMB Control Numbers 1215-0140 and
1215-0017.)
(ii) (a) The contractor shall submit weekly for each week in which any contract work is performed
a copy of all payrolls to HUD or its designee if the agency is a party to the contract, but if the agency
is not such a party, the contractor will submit the payrolls to the applicant, sponsor, or owner, as the
case may be, for transmission to HUD or its designee. The payrolls submitted shall set out
accurately and completely all of the information required to be maintained under 29 CFR Part
5.5(a)(3)(i). This information may be submitted in any form desired. Optional Form WH-347 is
available for this purpose and may be purchased from the Superintendent of Documents (Federal
Stock Number 029-005-00014-1), U.S. Government Printing Office, Washington, D.C. 20402. The
prime Contractor is responsible for the submission of copies of payrolls by all subcontractors.
(Approved by the Office of Management and Budget under OMB Control Number 1215-0149).
(b) Each payroll submitted shall be accompanied by a "Statement of Compliance," signed by the
contractor or subcontractor or his or her agent who pays or supervises the payment of the persons
employed under the contract and shall certify the following:
(1) That the payroll for the payroll period contains the information required to be maintained
under 29 CFR Part 5.5(a)(3)(i) and that such information is correct and complete;
(2) That each laborer or mechanic (including each helper, apprentice, and trainee) employed
on the contract during the payroll period has been paid the full weekly wages earned, without rebate,
either directly or indirectly, and that no deductions have been made either directly or indirectly from
the full wages earned, other than permissible deductions as set forth in 29 CFR Part 3;
(3) That each laborer or mechanic has been paid not less than the applicable wage rates and
fringe benefits or cash equivalents for the classification of work performed, as specified in the
applicable wage determination incorporated into the contract.
(c) The weekly submission of a properly executed certification set forth on the reverse side of
Optional Form WH-347 shall satisfy the requirement for submission of the "Statement of
Compliance" required by paragraph A.3(ii)(b) of this section.
(d) The falsification of any of the above certifications may subject the contractor or subcontractor
to civil or criminal prosecution under Section 1001 of Title 18 and Section 231 of Title 31 of the
United States Code.
(iii) The contractor or subcontractor shall make the records required under paragraph A.3(i) of
this section available for inspection, copying, or transcription by authorized representatives of HUD
or its designee or the Department of Labor, and shall permit such representatives to interview
employees during working hours on the job. If the contractor or subcontractor fails to submit the
required records or to make them available, HUD or its designee may, after written notice to the
contractor, sponsor, applicant, or owner, take such action as may be necessary to cause the
suspension of any further payment, advance, or guarantee of funds: Furthermore, failure to submit
the required records upon request or to make such records available may be grounds for debarment
action pursuant to 29 CFR Part 5.12. ,/
3
•
4. (i) Apprentices and Trainees. Apprentices will be permitted to work at less than the
predetermined rate for the work they performed when they are employed pursuant to and individually
registered in a bona fide apprenticeship program registered with the U.S. Department of Labor,
Employment and Training Administration, Bureau of Apprenticeship and Training, or with a State
Apprenticeship Agency recognized by the Bureau, or if a person is employed in his or her first 90 •
days of probationary employment as an apprentice in such an apprenticeship program, who is not
individually registered in the program, but who has been certified by the Bureau of Apprenticeship
and Training or a State Apprenticeship Agency (where appropriate) to be eligible for probationary
employment as an apprentice. The allowable ratio of apprentices to journeymen on the job site in
any craft classification shall not be greater than the ratio permitted to the contractor as to the entire
work force under the registered program. Any worker listed on a payroll at an apprentice wage rate,
who is not registered or otherwise employed as stated above, shall be paid not less than the
applicable wage rate on the wage determination for the classification of work actually performed. In
addition, any apprentice performing work on the job site in excess of the ratio permitted under the
registered program shall be paid not less than the applicable wage rate on the wage determination
for the work actually performed. Where a contractor is performing construction on a project in a
locality other than that in which its program is registered, the ratios and wage rates (expressed in
percentages of the journeyman's hourly rate) specified in the contractor's or subcontractor's
registered program shall be observed. Every apprentice must be paid at not less than the rate
specified in the registered program for the apprentice's level of progress, expressed as a percentage
of the journeymen hourly rate specified in the applicable wage determination. Apprentices shall be
paid fringe benefits in accordance with the provisions of the apprenticeship program. If the
apprenticeship program does not specify fringe benefits, apprentices must be paid the full amount of
fringe benefits listed on the wage determination for the applicable classification. If the Administrator
determines that a different practice prevails for the applicable apprentice classification, fringes shall
be paid in accordance with that determination. In the event the Bureau of Apprenticeship and
Training, or a State Apprenticeship Agency recognized by the Bureau, withdraws approval of an
apprenticeship program, the contractor will no longer be permitted to utilize apprentices at less than
the applicable predetermined rate for the work performed until an acceptable program is approved.
(ii) Trainees. Except as provided in 29 CFR 5.16, trainees will not be permitted to work at less
than the predetermined rate for the work performed unless they are employed pursuant to and
individually registered in a program which has received prior approval; evidenced by formal
certification by the U.S. Department of Labor, Employment and Training Administration. The ratio of
trainees to journeymen on the job site shall not be greater than permitted under the plan approved
by the Employment and Training Administration. Every trainee must be paid at not less than the rate
specified in the approved program for the trainee's level of progress, expressed as a percentage of
the journeyman hourly rate specified in the applicable wage determination. Trainees shall be paid
fringe benefits in accordance with the provisions of the trainee program. If the trainee program does
not mention fringe benefits, trainees shall be paid the full amount of fringe benefits listed on the
wage determination unless the Administrator of the Wage and Hour Division determines that there is
an apprenticeship program associated with the corresponding journeyman wage rate on the wage
determination which provides for less than full fringe benefits for apprentices. Any employee listed
on the payroll at a trainee rate who is not registered and participating in a training plan approved by
the Employment and Training Administration shall be paid not less than the applicable wage rate on
the wage determination for the work actually performed. In addition, any trainee performing work on
the job site in excess of the ratio permitted under the registered program shall be paid not less than
the applicable wage rate on the wage determination for the work actually performed. In the event
the Employment and Training Administration withdraws approval of a training program, the
contractor will no longer be permitted to utilize trainees at less than the applicable predetermined
rate for the work performed until an acceptable program is approved.
(iii) Equal employment opportunity. The utilization of apprentices, trainees and journeymen
under this part shall be in conformity with the equal employment opportunity requirements of
Executive Order 11246, as amended, and 29 CFR Part 30.
4
.5. Compliance with Copeland Act requirements. The contractor shall comply with the
requirements of 29 CFR Part 3 which are incorporated by reference in this contract.
6. Subcontracts. The contractor or subcontractor will insert in any subcontracts the clauses
contained in 29 CFR 5.5(a)(1) through (10) and such other clauses as HUD or its designee may by
appropriate instructions require, and also a clause requiring the subcontractors to include these
clauses in any lower tier subcontracts. The prime contractor shall be responsible for the compliance
by any subcontractor or lower tier subcontractor with all the contract clauses in 29 CFR Part 5.5
7. Contracts termination; debarment. A breach of the contract clauses in 29 CFR 5.5 may be
grounds for termination of the contract, and for debarment as a contractor and a subcontractor as
provided in 29 CFR 5.12.
8. Compliance with Davis-Bacon and Related Act Requirements. All rulings and
interpretations of the Davis-Bacon and Related Acts contained in 29 CFR Parts 1, 3, and 5 are
herein incorporated by reference in this contract.
9. Disputes concerning labor standards. Disputes arising out of the labor standards
provisions of this contract shall not be subject to the general disputes clause of this contract. Such
disputes shall be resolved in accordance with the procedures of the Department of Labor set forth in
29 CFR Parts 5, 6, and 7. Disputes within the meaning of this clause include disputes between the
contractor (or any of its subcontractors) and HUD or its designee, the U.S. Department of Labor, or
the employees or their representatives.
10. (i) Certification of Eligibility. By entering into this contract, the contractor certifies that
neither it (nor he or she) nor any person or firm who has an interest in the contractor's firm is a
person or firm ineligible to be awarded Government contracts by virtue of Section 3(a) of the Davis-
Bacon Act or 29 CFR 5.12(a)(1) or to be awarded HUD contracts or participate in HUD programs
pursuant to 24 CFR Part 24.
(ii) No part of this contract shall be subcontracted to any person or firm ineligible for award of a
Government contract by virtue of Section 3(a) of the Davis-Bacon Act or 29 CFR 5.12(a)(1) or to be
awarded HUD contracts or participate in HUD programs pursuant to 24 CFR Part 24.
(iii) The penalty for making false statements is prescribed in the U.S. Criminal Code, 18 U.S.C.
1001. Additionally, U.S. Criminal Code, Section 1010, Title 18, U.S.C. "Federal Housing
Administration transactions", provides in part "Whoever, for the purpose of...influencing in any way
the action of such Administration...makes, utters or publishes any statement knowing the same to be
false...shall be fined not more than $5,000 or imprisoned not more than two years, or both."
11. Complaints, Proceedings, or Testimony by Employees. No laborer or mechanic to whom
the wage, salary, or other labor standards provisions of this Contract are applicable shall be
discharged or in any other manner discriminated against by the contractor or any subcontractor
n or instituted or caused to be instituted
such employee has filedt any
because anycomplaint com p
proceeding or has testified or is about to testify in any proceeding under or relating to the labor
standards applicable under this Contract to his employer.
B Contract Work Hours and Safety Standards Act. As used in this paragraph, the terms
"laborers"and"mechanics" include watchmen and guards.
(1) Overtime requirements. No contractor or subcontractor contracting for any part of the
contract work which may require or involve the employment of laborers or mechanics shall require or
permit any such laborer or mechanic in any workweek in which he or she is employed on such work
to work in excess of forty hours in such workweek unless such laborer or mechanic receives
compensation at a rate not less than one and one-half times the basic rate of pay for all hours
worked in excess of forty hours in such workweek. hiu
5
` r
• (2) Violation; liability for unpaid wages; liquidated damages. In the event of any violation of
the clause set forth in subparagraph (1) of this paragraph, the contractor and any subcontractor
responsible therefor shall be liable for the unpaid wages. In addition, such contractor and
subcontractor shall be liable to the United States (in the case of work done under contract for the
District of Columbia or a territory, to such District or to such territory), for liquidated damages. Such
liquidated damages shall be computed with respect to each individual laborer or mechanic, including
watchmen and guards, employed in violation of the clause set forth in subparagraph (1) of this
paragraph, in the sum of $10 for each calendar day on which such individual was required or
permitted to work in excess of the standard workweek of forty hours without payment of the overtime
wages required by the clause set forth in subparagraph (1) of this paragraph.
(3) Withholding for unpaid wages and liquidated damages. HUD or its designee shall upon
its own action or upon written request of an authorized representative of the Department of Labor
withhold or cause to be withheld, from any moneys payable on account of work performed by the
contractor or subcontractor under any such contract or any other Federal contract with the same
prime contractor or any other Federally-assisted contract subject to the Contract Work Hours and
Safety Standards Act, which is held by the same prime contractor such sums as may be determined
to be necessary to satisfy any liabilities of such contractor or subcontractor for unpaid wages and
liquidated damages as provided in the clause set forth in subparagraph (2) of this paragraph.
(4) Subcontracts. The contractor or subcontractor shall insert in any subcontracts the clauses
set forth in subparagraph (1) through (4) of this paragraph and also a clause requiring the
subcontractors to include these clauses in any lower tier subcontracts. The prime contractor shall be
responsible for compliance by any subcontractor or lower tier subcontractor with the clauses set
forth in subparagraphs (1) through (4) of this paragraph.
C. Health and Safety
(1) No laborer or mechanic shall be required to work in surroundings or under working conditions
which are unsanitary, hazardous, or dangerous to his health and safety as determined under
construction safety and health standards promulgated by the Secretary of Labor by regulation.
(2) The Contractor shall comply with all regulations issued by the Secretary of Labor pursuant to
Title 29 Part 1926 (formerly part 1518) and failure to comply may result in imposition of sanctions
pursuant to the Contract Work Hours and Safety Standards Act (Public Law 91-54, 83 Stat. 96).
(3) The Contractor shall include the provisions of this Article insubcontract so that such
every
provisions will be binding on each subcontractor. The Contractor shall take such action with respect
to any subcontract as the Secretary of Housing and Urban Development or the Secretary of Labor
shall direct as a means of enforcing such provisions.
6
LITTTl 1.r,l!1 I' Q1.\
Federal Labor Standards Provisions Exhibit I
U.S.Department of Housing and Urban Development
Applicability
The project or Program to which the construction work covered by this contract pertains is being assisted by the
United States of America and the following Federal Labor Standards Provisions are included in this Contract
pursuant to the provisions applicable to such federal assistance.
A. 1. (i) Minimum Wages. All laborers and mechanics employed or working upon the site of the work (or
under the United States Housing Act of 1937 or under the Housing Act of 1949 in the construction or
development of the project), will be paid unconditionally and not less often than once a week, and
without subsequent deduction or rebate on any account (except such payroll deductions as are
permitted by regulations issued by the Secretary of Labor under the Copeland Act(29 CFR Part 3),the
full amount of wages and bona fide fringe benefits(or cash equivalents thereof)due at time of payment
computed at rates not less than those contained in the wage determination of the Secretary of Labor
which is attached hereto and made a part hereof, regardless of any contractual relationship which may
be alleged to exist between the contractor and such laborers and mechanics. Contributions made or
costs reasonably anticipated for bona fide fringe benefits under Section 1(b)(2)of the Davis-Bacon Act
on behalf of laborers or mechanics are considered wages paid to contributions made or costs incurred
for more than a weekly period(but not less often than quarterly)under plans, funds or programs which
cover the particular weekly period, are deemed to be constructively made or incurred during such
weekly period.
Such laborers and mechanics shall be paid the appropriate wage rate and fringe benefits on the wage
determination for the classification of work actually performed, without regard to skill, except as
provided in 29 CFR Part 5.5(a)(4). Laborers or mechanics performing work in more than one
classification may be compensated at the rate specified for each classification for the time actually
worked therein. Provided that the employer's payroll records accurately set forth the time spent in
each classification in which work is performed. The wage determination (including any additional
classification and wage rates conformed under 29 CFR Part 5.5(a)(1)(ii) and the Davis-Bacon poster
(WH-1321) shall be posted at all times by the contractor and its subcontractors at the site of the work
in a prominent and accessible place where it can be easily seen by the workers.
(ii) (a) Any class of laborers or mechanics which is not listed in the wage determination and which is to
be employed under the contract shall be classified in conformance with the wage determination,
HUD shall approve an additional classification and wage rate and fringe benefits therefore only
when the following criteria have been met:
(1) The work to be performed by the classification requested is not performed by a classification
in the wage determination; and
(2) The classification is utilized in the area by the construction industry; and
(3) The proposed wage rate, including any bona fide fringe benefits, bears a reasonable
relationship to the wage rates contained in the wage determination.
(b) If the contractor and the laborers and mechanics to be employed in the classification(if known),or
their representatives,and HUD or its designee agree on the classification and wage rage(including
the amount designated for fringe benefits where appropriate), a report of the action taken shall be
sent by HUD or its designee to the Administrator of the Wage and Hour Division, Employment
Standards Administration, U.S. Depaitinent of Labor, Washington, D.C. 20210. The
Administrator, or an authorized representative, will approve, modify or disapprove every
additional classification action within 30 days of receipt and so advise HUD or its designee or will
notify HUD or its designee within the 30-day period that additional time is necessary. (Approved
by the Office of Management and Budget under OMB control number 1215-0140.)
(c) In the event the contractor, the laborers or mechanics to be employed in the classification or their
representatives,and HUD or its designee do not agree on the proposed classification and wage rate
(including the amount designated for fringe benefits, where appropriate), HUD or its designee
1
shall refer the questions, including the views of all interested parties and the recommendation of
HUD or its designee,to the Administrator for determination. The Administrator, or an authorized
representative, will issue a determination within 30 days of receipt and so advise HUD or its
designee or will notify HUD or its designee with the 30-day period that additional time is
necessary. (Approved by the Office of Management and Budget under OMB Control Number
1215-0140.)
(d) The wage rate(including fringe benefits where appropriate)determined pursuant to subparagraphs
(1)(b) or (c) of this paragraph, shall be paid to all workers performing work in the classification
under this contract from the first day on which work is performed in the classification.
(iii) Whenever the minimum wage rage prescribed in the contract for a class of laborers or mechanics
includes a fringe benefit which is not expressed as an hourly rate, the contractor shall either pay the
benefit as stated in the wage determination or shall pay another bona fide fringe benefit or an hourly
cash equivalent thereof.
(iv) If the contractor does not make payments to a trustee or other third person,the contractor may consider
as part of the wages of any laborer or mechanic the amount of any costs reasonably anticipated in
providing bona fide fringe benefits under a plan or program,provided, that the Secretary of Labor has
found,upon the written request of the contractor,that the applicable standards of the Davis-Bacon Act
have been met. The Secretary of Labor may require the contractor to set aside in a separate account
assets for the meeting of obligations under the plan or program. (Approved by the Office of
Management and Budget under OMB Control Number 1215-0140.)
2. Withholding. HUD or its designee shall upon its own action or upon written request of an authorized
representative of the Depaitiuent of Labor withhold or cause to be withheld from the contractor under this
contract or any other federal contract with the same prime contractor, or any other federally-assisted
contract subject to Davis-Bacon prevailing wage requirements, which is held by the same prime contractor
so much of the accrued payments or advances as may be considered necessary to pay laborers and
mechanics,including apprentices,trainees and helpers,employed by the contractor or any subcontractor the
full amount of wages required by the contract. In the event of failure to pay any laborer or mechanic,
including any apprentice, trainee or helper employed or working on the site of the work (or under
the Untied States Housing Act of 1937 or under the Housing Act of 1949 in the construction or
development of the project), all or part of the wages required by the contract, HUD or its designee
may, after written notice to the contractor, sponsor, applicant, or owner, take such action as may be
necessary to cause the suspension of any further payment, advance, or guarantee of funds until such
violations have ceased. HUD or its designee may, after written notice to the contractor, disburse such
amounts withheld for and on account of the contractor or subcontractor to the respective employees to
whom they are due. The Comptroller General shall make such disbursements in the case of direct Davis-
Bacon Act contracts.
(3) (i) Payrolls and basic records. Payrolls and basic records relating thereto shall be maintained by the
contractor during the course of the work preserved for a period of three years thereafter for all laborers
and mechanics working at the site of the work (or under the United States Housing Act of 1937, or
under the Housing Act of 1949, in the construction or development of the project). Such records shall
contain the name, address, and social security number of each such worker, his or her correct
classification, hourly rates of wages paid(including rates of contributions or costs anticipated for bona
fide fringe benefits or cash equivalents thereof of the types described in Section 1(b)(2)(B) of the
Davis-Bacon Act), daily and weekly number of hours worked, deductions made and actual wages paid.
Whenever the Secretary of Labor has found under 29 CFR 5.5 (a)(1)(iv) that the wages of any laborer
or mechanic include the amount of any costs reasonably anticipated in providing benefits under a plan
or program described in Section 1(b)92)(B) of the Davis-Bacon Act, the contractor shall maintain
records which show that the commitment to provide such benefits is enforceable, that the plan or
program is financially responsible, and that the plan or program has been communicated in writing to
the laborers or mechanics affected, and records which show the costs anticipated or the actual cost
incurred in providing such benefits. Contractors employing apprentices or trainees under approved
programs shall maintain written evidence of the registration of apprenticeship programs and
certification of trainee programs, the registration of the apprentices and trainees, and the ratios and
2
wage rates prescribed in the applicable programs. (Approved by the Office of Management and Budget
under OMB Control Number 1215-0017.)
(ii) (a) The contractor shall submit weekly for each week in which any contract work is performed a copy
of all payrolls to HUD or its designee if the agency is a party to the contract,but if the agency is
not such a party, the contractor will submit the payrolls to the applicant, sponsor, or owner, as the
case may be, for transmission to HUD or its designee. The payrolls submitted shall set out
accurately and completely all of the information required to be maintained under 29 CFR Part
5.5(a)(3)(i). This information may be submitted in any form desired. Optional Form WH-347 is
available for this purpose and may be purchased from the Superintendent of Documents (Federal
Stock Number 029-005-00014-1), U.S. Government Printing Office, Washington, D.C. 20402.
The prime Contractor is responsible for the submission of copies of payrolls by all subcontractors.
(Approved by the Office of Management and Budget under OMB Control Number 1215-0149.)
(b) Each payroll submitted shall be accompanied by a "Statement of Compliance", signed by the
contractor or subcontractor or his or her agent who pays or supervises the payment of the persons
employed under the contract and shall certify the following:
(1) That the payroll for the payroll period contains the information required to be maintained
under 29 CFR Part 5.5(a)(3)(i)and that such information is correct and complete;
(2) That each laborer or mechanic (including each helper, apprentice and trainee) employed on
the contract during the payroll period has been paid the full weekly wages earned, without
rebate, either directly or indirectly, and that no deductions have been made either directly or
indirectly from the full wages earned, other than permissible deductions as set forth in 29
CFR Part 3;
(3) That each laborer or mechanic has been paid not less than the applicable wage rates and fringe
benefits or cash equivalents for the classification of work performed, as specified in the
applicable wage determination incorporated into the contract.
(c) The weekly submission of a properly executed certification set forth on the reverse side of
Optional Form WH-347 shall satisfy the requirement for submission of the "Statement of
Compliance"required by paragraph A.3(ii)(b)of this section.
(d) The falsification of any of the above certifications may subject the contractor or subcontractor to
civil or criminal prosecution under Section 1001 of Title 18 and Section 231 of Title 31 of the
United States Code.
(iii) The contractor or subcontractor shall make the records required under paragraph A.3(i) of this section
available for inspection, copying or transcription by authorized representatives of HUD or its designee
or the Department of Labor, and shall permit such representatives to interview employees during
working hours on the job. If the contractor or subcontractor fails to submit the required records or to
make them available, HUD or its designee may, after written notice to the contractor, sponsor,
applicant or owner, take such action as may be necessary to cause the suspension of any further
payment, advance or guarantee of funds: Furthermore, failure to submit the required records upon
request or to make such records available may be grounds for debarment action pursuant to 29 CFR
Part 5.12.
(2) Violation; liability for unpaid wages; liquidated damages. In the event of any violation of the clause set
forth in subparagraph(1) of this paragraph, the contractor and any subcontractor responsible therefor shall
be liable for the unpaid wages. In addition, such contractor and subcontractor shall be liable to the United
States(in the case of work done under contract for the District of Columbia or a territory,to such District or
to such territory), for liquidated damages. Such liquidated damages shall be computed with respect to each
individual laborer or mechanic, including watchmen and guards, employed in violation of the clause set
forth in subparagraph (1) of this paragraph, in the sum of $10 for each calendar day on which such
individual was required or permitted to work in excess of the standard workweek of forty hours without
payment of the overtime wages required by the clause set forth in subparagraph(1)of this paragraph.
(3) Withholding for unpaid wages and liquidated damages. HUD or its designee shall upon its own action
or upon written request of an authorized representative of the Department of Labor withhold or cause to be
3
withheld from any monies payable on account of work performed by the contractor or subcontractor under
any such contract or any other federal contract with the same prime contractor or any other federally-
assisted contract subject to the Contract Work Hours and Safety Standards Act, which is held by the same
prime contractor such sums as may be determined to be necessary to satisfy any liabilities of such
contractor or subcontractor for unpaid wages and liquidated damages as provided in the clause set forth in
subparagraph(2)of this paragraph.
(4) Subcontracts. The contractor or subcontractor shall insert in any subcontracts the clauses set forth in
subparagraph (1) through (4) of this paragraph and also a clause requiring the subcontractors to include
these clauses in any lower tier subcontracts. The prime contractor shall be responsible for compliance by
any subcontractor or lower tier subcontractor with the clauses set forth in subparagraphs(1) through(4) of
this paragraph.
C. Health and Safety
(1) No laborer or mechanic shall be required to work in surroundings or under working conditions which are
unsanitary, hazardous or dangerous to his health and safety as determined under construction safety and
health standards promulgated by the Secretary of Labor by regulation.
(2) The Contractor shall comply with all regulations issued by the Secretary of Labor pursuant to Title 29 Part
1926 (formerly part 1518) and failure to comply may result in imposition of sanctions pursuant to the
Contract Work Hours and Safety Standards Act(Public Law 91-54, 83 Stat. 96).
(3) The Contractor shall include the provisions of this Article in every subcontract so that such provisions will
be binding on each subcontractor. The Contractor shall take such action with respect to any subcontract as
the Secretary of Housing and Urban Development or the Secretary of Labor shall direct as a means of
enforcing such provisions.
4
Exhibit J
CITY OF OMAHA
AFFIRMATIVE MARKETING POLICY
AND MONITORING PROCEDURES
Effective: October 1, 1999
Revised: January 1, 2003
Affirmative Marketing Policy
In furtherance of the City of Omaha's commitment to non-discrimination and equal opportunity
in housing, the City of Omaha establishes procedures to affirmatively market units constructed or
rehabilitated under any City-assisted program or project. These procedures are intended to
further the objectives of Title VIII of the Civil Rights Act of 1968 and Executive Order 11063.
It is the affirmative marketing goal of the City of Omaha to assure that individuals who normally
might not apply for vacant rehabilitated or constructed units because of their race or ethnicity:
• know about the vacancies
• feel welcome to apply
• have the opportunity to rent or purchase the units
This policy will be carried out through the following procedures:
1. Informing the public, potential tenants and owners about federal fair housing laws and
affirmative marketing policies
• The City of Omaha will inform the public, potential tenants, purchasers and owners
about its affirmative marketing policy, Title VIII and Executive Order 11063.
• The City will place public notices in the Omaha World Herald and the North
Omaha Star to inform owners of the program.
• City representatives will meet with property owners and assist them in preparing
program applications as requested and necessary.
• Owners selected for a rehabilitation program shall notify in-place tenants in writing
of their involvement in the program and provide them with the following options:
1. Remain in the present unit during rehabilitation.
2. Move temporarily to another unit within the project while his/her unit is being
rehabilitated.
3. Permanently relocate or voluntarily abandon the unit during the rehabilitation.
• Owners shall post the HUD Equal Housing Opportunity Logo in the project
building and display the Fair Housing Poster in their rental office.
1
• Owners shall use media accessible to minorities when advertising the availability
of units.
• Owners shall use the Equal Housing Opportunity logo, slogan or statement in all
advertising.
• Owners shall maintain a non-discriminatory hiring policy.
• Owners shall adopt a fair housing policy.
2. Informing low- and moderate-income persons about available units
Property Owners having vacant units may call the Omaha Housing Authority (OHA) at
444-6900 and place units on OHA's "Available Unit" list. This list is distributed to
families who have received Certificates of Family Participation and are looking for units
to rent. The listing will remain on the "Available" list for 35 calendar days, then be
removed. If still vacant, the property may be relisted.
If the property is not listed with OHA when rehabilitated or constructed units are
available for initial occupancy, the owner shall inform the following outreach agencies
and/or other agencies of this fact in writing and submit a copy of the letters to the City of
Omaha, Planning Department, Housing and Community Development Division, Loan
Section, 1819 Farnam Street, Room 1111, Omaha,Nebraska, 68183.
Chicano Awareness, Inc. Urban League of Nebraska
4821 South 24th Street 3022 North 24th Street
Omaha,NE 68107 Omaha,NE 68111
Family Housing Advisory Services Community Alliance
2416 Lake Street 4011 Leavenworth Street
Omaha,NE 68111 Omaha,NE 68105
Eastern Nebraska Human Services Family Service
900 South 74th Plaza, Suite 200 2101 South 42"a Street
Omaha, NE 68114 Omaha,NE 68105
Greater Omaha Community Action Family Service
2406 Fowler Avenue 6720 North 30th Street
Omaha,NE 68111 Omaha,NE 68112
Greater Omaha Community Action Family Service
5211 South 31st Street 116 E. Mission Avenue
Omaha, NE 68111 Bellevue,NE 68005
2
League of Human Dignity Family Service
5513 Center Street 2580 South 90th Street
Omaha, NE 68106 Omaha, NE 68124
South Omaha Affordable Housing Corp. Omaha Association for the Blind
3605 "Q" Street 1024 South 32"1 Street
Omaha, NE 68107 Omaha,NE 68105
Nebraska Commission for the Deaf Paralyzed Veterans of America
1313 Farnam on the Mall 7612 Maple Street
Omaha,NE 68102 Omaha, NE 68134
Mayor's Commission for Citizens Holy Name Housing Corporation
with Disabilities 3014 North 45th Street
1819 Farnam Street, Room 304 Omaha,NE 68104
Omaha,NE 68183
3. Record Keeping
The Owner shall keep records of the following:
• Local media advertisements of the vacant unit
• Contact dates with outreach agencies and Omaha Housing Authority
• Correspondence informing outreach agencies of vacancies
• Race and other demographic data of occupants and persons inquiring about
availability of units
• Tenant Survey, utility allowance and income determination forms signed and dated
by Owner
• Name and age of all household members
• Verified income for each household
• Copy of lease
4. Assessment of Actions
The Owner's affirmative marketing efforts will be assessed by the City to:
• determine whether Owners have affirmatively marketed vacant units to individuals
who normally might not apply; and,
• determine whether a sufficient number of racial and ethnic families have applied for
vacant units
The City will take corrective action if it is found that property owners are not carrying out
established procedures of the City's Affirmative Marketing Policy and Monitoring Procedures.
3
Affirmative Marketing Policy Monitoring Procedures
1. Duties and Responsibilities of the Owner
a) The Owner shall post the HUD Equal Housing Opportunity Logo in the project
building and in the rental or sales office.
b) The Owner shall submit to the City a copy of all letters notifying the outreach
agencies of vacancies. Outreach agencies may include, but are not limited to, the
agencies listed in Item 2, Page 2.
c) The Owner shall submit to the City a copy of all advertisements placed in the local
newspapers. All advertisements must include the Equal Housing Opportunity
Logo, Slogan or Statement.
d) The Owner shall submit to the City a Demographics for Applicant, attached as
Exhibit 1, which includes the name, racial/ethnic characteristics, income and family
size for each person responding to the advertisement.
e) The Owner shall meet with each in-place tenants of the occupied vacant units and
complete a Tenant Survey, utility allowance and income determination form. A
copy of each form is attached and marked Exhibit 2.
f) The Owner shall submit to the City the original Tenant Survey, utility allowance,
income determination form (signed and dated by Owner) and a copy of the lease
agreement and retain a copy for proper record keeping. Forms must be updated on
lease anniversary date and submitted to the City.
g) The Owner shall provide each in-place tenant in the project with a copy of the City
of Omaha's written Tenant Assistance Policy (TAP) and shall advise said tenant(s)
of the impact of the project on him or her. The Owner shall provide the TAP to the
tenant immediately after submission of the Owner's application for participation in
the City's program.
h) After completion of the project, the Owner shall submit a Tenant Survey, utility
allowance and income determination form (signed and dated by Owner) for each
occupied unit and a copy of the lease agreement.
i) Owner shall insure that the rents, including utilities and Median Family Income, are
consistent with the terms and conditions in the approved Agreement between the
Owner and the City of Omaha
4
2. Duties and Responsibilities of the City
a) The City shall assess the affirmative marketing procedures to determine whether the
Owner has affirmatively marketed the vacant units by monitoring the Owner's
performance in carrying out the Duties and Responsibilities of the Owner as
outlined in Section 1.
b) The City shall assess the affirmative marketing efforts of the Owner to determine
whether a sufficient number of racial and ethnic families have applied for vacant
units. This determination will be made by reviewing the information provided on
the Demographics Form for Applicant and Tenant Survey Form to determine the
proportion of racial/gender participation versus overall participation.
c) The City shall take the following corrective action if it is found that the Owner is
not carrying out established procedures of affirmatively marketing units:
Notify• the Owner in writingof anyviolations of the Owner's Duties and
Responsibilities.
■ The Owner will be given thirty(30) days upon receipt of written notification to
provide evidence of compliance. Upon the Owner's request, the City will
provide technical assistance.
• If the Owner fails to comply with the Affirmative Marketing Policy and
Monitoring Procedures, the City may declare the loan/grant in default.
5
Exhibit K
Sec. 84.21 Standards for financial management systems.
(a) HUD shall require recipients to relate financial data to performance data and develop unit
cost information whenever practical.
(b) Recipients' financial management systems shall provide for the following:
(1) Accurate, current and complete disclosure of the financial results of
((Page 456))
each federally-sponsored project or program in accordance with the reporting
requirements set forth in Sec. 84.52. If a recipient maintains its records on other than
an accrual basis, the recipient shall not be required to establish an accrual accounting
system. These recipients may develop such accrual data for their reports on the basis
of an analysis of the documentation on hand.
(2) Records that identify adequately the source and application of funds for federally-
sponsored activities. These records shall contain information pertaining to federal
awards, authorizations, obligations, unobligated balances, assets, outlays, income and
interest.
(3) Effective control over and accountability for all funds, property and other assets.
Recipients shall adequately safeguard all such assets and assure they are used solely
for authorized purposes.
(4) Comparison of outlays with budget amounts for each award. Whenever appropriate,
financial information should be related to performance and unit cost data.
(5) Written procedures to minimize the time elapsing between the transfer of funds to the
recipient from the U.S. Treasury and the issuance or redemption of checks, warrants
or payments by other means for program purposes by the recipient. To the extent that
the provisions of the Cash Management Improvement Act (CMIA) (Pub. L. 101-453)
govern, payment methods of state agencies, instrumentalities, and fiscal agents shall
be consistent with CMIA Treasury-State Agreements or the CMIA default procedures
codified at 31 CFR Part 205, "Withdrawal of Cash from the Treasury for Advances
under Federal Grant and Other Programs."
(6) Written procedures for determining the reasonableness, allocability and allowability
of costs in accordance with the provisions of the applicable federal cost principles and
the terms and conditions of the award.
(7) Accounting records including cost accounting records that are supported by source
documentation.
(c) Where the federal government guarantees or insures the repayment of money borrowed
by the recipient, HUD, at its discretion, may require adequate bonding and insurance if
the bonding and insurance requirements of the recipient are not deemed adequate to
protect the interest of the federal government.
(d) HUD may require adequate fidelity bond coverage where the recipient lacks sufficient
coverage to protect the federal government's interest.
(e) Where bonds are required in the situations described above, the bonds shall be obtained
from companies holding certificates of authority as acceptable sureties, as prescribed in
31 CFR Part 223, "Surety Companies Doing Business with the United States."
J
OMB Circular A-122 http://www.whitehouse.gov/omb/circulars/a122/a122.html
EXHIBIT L
• OFFICE OF MANAGEMENT AND BUDGET
•
Cost Principles for Non-Profit Organizations
AGENCY: Office of Management and Budget
ACTION: Final revision of OMB Circular A-122,"Cost Principles for Non-Profit Organizations"
SUMMARY: The Office of Management and Budget(OMB)revises OMB Circular A-122 by amending
the definition for equipment;requiring the breakout of indirect costs into two categories(facilities and
administration) for certain non-profit organizations;modifying the multiple allocation basis; and, clarifying
the treatment of certain cost items.
DATES: The revision is effective on June 1, 1998.
FOR FURTHER INFORMATION CONTACT: Federal agencies should contact Gilbert Tran, Office of
Federal Financial Management,Office of Management and Budget, (202)395-3993.Non-Federal
organizations should contact the organization's Federal cognizant agency.
SUPPLEMENTARY INFORMATION:
A.Background
On October 6, 1995;the Office of Management and Budget(OMB)issued a final revision to OMB
Circular A-122,"Cost Principles for Non-Profit Organizations,"in the Federal Register(60 FR 52516)
regarding interest allowability. The revision was made in a continuing effort to increase consistency across
OMB's cost principles circulars A-122,A-21, "Cost Principles for Educational Institutions," and A-87,
"Cost Principles for State,Local and Indian Tribal Governments."To further the goals of consistency,
OMB proposed on the same date(60 FR 52522)to revise the definition of equipment,to clarify the
treatment of certain types of costs,to modify the multiple allocation base method for computing indirect
cost rate(s),and to place an upper-limit on payments of administrative expenses for certain non-profit
organizations.
With this final revision,Circular A-122 consists of the Circular as issued in 1980(45 FR 46022;July 8,
1980), as amended in 1984(49 FR 18260; April 27, 1984),in 1987(52 FR 19788;May 27, 1987),in 1995
(60 FR 52516;October 6, 1995),in 1997(62 FR 45934;August 29, 1997), and in this notice. A
recompilation of the entire Circular A-122,with all its amendments, accompanies the notice and is
available in electronic form on the OMB Home Page at http://www.whitehouse.gov/OMB.
B.Current Revisions
Circular A-122 is revised in this notice to:
1.Amend the definition of equipment by increasing the capitalization threshold to the lesser amount used
for financial statement purposes or$5,000(see paragraph 15).
2.Require major non-profit organizations(those receiving more than$10 million in direct Federal funding)
to report indirect cost rates by two major component categories: facilities and administration(see paragraph
D,Attachment A).
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3. Modify the multiple allocation base method(MAB)to be consistent with OMB Circular A-21 (see
paragraph D.3).However,major non-profit organizations are not required to use the multiple allocation
base method. MAB remains one of the three available methodologies for computing indirect costs.
4. Clarify the treatment of the following cost items to provide consistency across OMB's cost principles
circulars(A-21 and A-87)and the Federal Acquisition Regulations,where applicable:
• Alcoholic beverages
• Advertising and public relations costs
• Organization-furnished automobiles
• Defense and prosecution of criminal and civil proceedings,claims,appeals and patent infringements
• Housing and living expenses
• Insurance
• Memberships
• Selling or marketing of goods and services
• Severance pay for foreign nationals
OMB is not implementing the proposed restrictions on trustees'travel expenses at non-profit organizations.
In line with this decision,and to further consistency between cost circulars, OMB will be amending
Circular A-21 to allow trustees'travel expenses.
OMB defers considering an upper-limit on payment of administrative expenses until better data on indirect
costs at non-profit organizations are collected.
C. Comments and Responses
OMB received about 185 comments from non-profit organizations,Federal agencies,professional
organizations and accounting firms. A summary of comments and OMB's responses are included in this
notice. Several comments resulted in modifications to OMB's original proposal.
The comments and OMB's responses are summarized by section as follow.
Equipment Definition
Comment:Clarification is needed on the treatment of depreciation of those assets which had costs between
the old$500 threshold and the new$5,000.
Response: In order to clarify the accounting for the undepreciated portion of any equipment costs as a
result of a change in capitalization levels,paragraph 15 has been added to explain that the undepreciated
amount may be recovered by continuing to claim otherwise allowable use allowances pr depreciation on
the equipment,or by amortizing the amount to be written off over a period of years as negotiated with the
Federal cognizant agency.
Comment: Clarification is needed on whether equipment under the$5,000 threshold, as established by the
non-profit organizations'policy,requires Federal approval prior to acquisition.
Response: Equipment under the$5,000 threshold,as established by the non-profit organization's policy,
can be directly charged to sponsored agreements(subparagraph 15.b)without prior Federal approval.
Comment: Current subparagraph 13.b requires prior approval for special purpose equipment,as direct
1 ry
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OMB Circular A-122 http://www.whitehouse.gov/omb/circulars/a122/a122.htmi
costs,with a unit cost of$1,000 or more. This requirement is not consistent with the higher threshold of
$5,000 allowed in the proposed revision.This requirement should be revised to be consistent with the
proposed revision.
Response: OMB agrees. The Circular is revised to require prior Federal approval only for special purpose
equipment with a unit cost of$5,000 or more.
Unallowable Cost Items
These ten revised cost items are already unallowable under OMB Circulars A-21,"Cost Principles for
Educational Institutions," and A-87, "Cost Principles for State,Local and Indian Tribal Governments,"
and/or the Federal Acquisition Regulations. OMB addressed the issue of trustees'travel in response to the
comments received. For the other items,consistency across Federal cost regulations was a more significant
issue than most of the commenters'concerns. Comments related to specific cost items are presented below,
followed by OMB's responses.
Advertising and Public Relations Costs
Comment: Current paragraph 37,Public information service costs,should be combined with the
"Advertising"paragraph to be consistent with other OMB cost principles in Circulars A-21 and A-87.
Response: The commenter is correct. The treatment of public information service costs is now addressed in
revised paragraph 1,Advertising and public relations costs. Current paragraph 37 is deleted.
Comment: Clarify the types of activities that are allowable as public relations costs. Public relations costs
to carry out certain functions,such as legitimate program outreach,that are required under sponsored
programs and contracts should be allowable.
Response: The Circular is revised to clarify that certain public relations costs for the purpose of
communicating specific activities related to the sponsored programs to the public or the press are allowable
costs. When they are necessary for program outreach effort as required by sponsored programs,public
relations costs are allowable. Costs of advertising and public relations incurred solely to promote the
organization are unallowable.
Comment: Clarify whether advertising media costs such as radio and television are allowable.
Response: As long as the public relations costs are specifically required by the sponsored programs or are
related to the promotion of sponsored programs,any reasonable advertising media,including magazines,
newspapers,radio,television,direct mail,exhibits,and the like,can be used and its costs are allowable.
See paragraph 1.a.
Comment: Community relation costs should be allowable as part of program outreach effort for Federal
sponsored programs.
Response: Community relations are defined in subparagraph 1.b as"those activities dedicated to maintain
the image of the organization or promoting understanding and favorable relations with the community or
public at large or any segment of the public." Costs related to community relations are allowable when the
costs are required or necessary to the performance of the sponsored programs.
Organization-furnished automobiles for personal use
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Comment: For security and economic reasons,non-profit organizations often furnish automobiles and
housing for its personnel working on Federal projects(e.g., overseas projects sponsored by the U.S.
Agency for International Development or the U.S. State Department). These costs should be allowable as
direct costs.
Response: The Circular is revised to allow these costs when they are necessary to perform the Federal
projects,particularly the overseas sponsored projects with prior approval by the Federal awarding agency.
These costs are allowable only as direct costs to the Federal projects, and not as fringe benefit or indirect
costs.
Comment: The Circular should specify which types of automobiles are allowable or unallowable(e.g., cars,
vans,trucks and buses).
Response: The types of automobiles are irrelevant for the purpose of determining the allowability of
automobile costs. Rather,the determinant factors should be whether the automobile costs are reasonable
and necessary for the performance of the Federal projects and authorized by the Federal awarding agency.
Defense and prosecution of criminal and civil proceedings,claims,appeals and patent infringements
Comment: Current paragraph 35.d,Professional service costs, should be combined with new paragraph 10.
Response: OMB agrees. Current paragraph 35.d is deleted. Professional service costs related to defense of
antitrust suits,prosecution of claims against the Federal Government and patent infringement litigation are
discussed in new paragraph 10. Professional service costs incurred for organization and reorganization are
discussed in paragraph 31, Organization costs.
Comment: Clarification is needed as to when legal costs related to claims,appeals or proceeding become
unallowable. Commenters noted that Federal agencies are inconsistent in the determination of the
allowability of legal costs as one agency would allow legal costs up to the point where the case goes out of
the Federal agency appeal process and to the courts,whereas other agencies would only allow legal costs
through the first phase of appeals within the Federal agency.
Response: The policy makes unallowable legal and related costs for either defending against claims made
by the Federal Government or prosecuting claims against the Government. As such,once a final
management decision letter is issued by the agency(for example,a disallowance letter),all legal and
related costs are unallowable from that point forward. Unallowable costs would include claims and
defenses pursued through agencies' formal appeal procedures such as administrative law judges and agency
appeal boards. Note that legal and related costs may be allowable if the non-profit organization's position is
sustained by the administrative appeal process or an agreement is reached between the organization and the
Federal Government(see subparagraghs 10.b, 10.c, 10.d and 10.e). This revision is consistent with the
language contained in OMB Circular A-21, "Cost Principles for Educational Institutions."
Comment: Some commenters objected to the proposed 80 percent limitation on reimbursement when the
institution is found innocent.
Response: The proposed revision was retained because it provides consistency with procurement contracts.
This limitation is based on the statutory language of Public Law 100-700, Major Fraud Act of 1988,
November 19, 1988 (41 U.S.C., 256(k)(5)),which only allows recovery of 80 percent of the legal costs.
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Comment: Legal expenses to defend against lawsuits brought by a foreign government for violation of that
country's law should be allowable.
Response: The Circular is revised in subparagraph 10.d to authorize Federal agencies to allow legal
expenses to defend against lawsuits brought by a foreign government for violation of its law when such
costs were necessary or were direct results of the performance of Federal sponsored programs. The same
authorizations apply for legal costs for defense against lawsuits brought by state or local governments.
Comment: Legal fees to defend against lawsuits filed by former employees for termination or by
subrecipients should be allowable.
Response: Legal fees incurred in defense of lawsuits not brought by a Federal, State, local or foreign
government,except when the suits are brought by former employees under Section 2 of the Major Fraud
Act of 1988 (Pub. L. 100-700), are allowable.
Housing and living expenses
Comment:For security and economic reasons,non-profit organizations often furnish automobiles and
housing for its personnel working on overseas Federal projects(e.g.,overseas projects sponsored by the
U.S. Agency for International Development).These costs should be allowable as direct costs.
Response: As previously noted(in the discussion of automobiles),the Circular is revised to allow these .
costs when they are necessary to perform the Federal projects and when they are approved by the Federal
awarding agency.These costs are allowable only as direct costs to the Federal projects, and not as fringe
benefit or indirect costs.
Insurance
Comment: General and casualty liability insurance costs for organization's directors and administrators
should be allowable.
Response: General and casualty liability insurance costs for organization's directors and administrators are
allowable,subject to limitations, as described in subparagraph 22.a.(2). New subparagraph 22.a.(2).f,
sponsored awards for
ent of costs against Federally
Insurance against defects,prohibits the reimbursement
product(or services) liability insurance costs.
Comment: Medical liability insurance costs for participants in Federal training programs should be
allowable.
Response: Medical liability insurance costs associated with participants in Federal training programs are
allowable to Federal programs as direct costs.
Comment: Malpractice insurance costs for physicians should be direct charged to Federal programs while
malpractice insurance costs for nurses or laboratory assistants,which are immaterial in most cases, should
be charged as indirect costs.
Response: Subparagraph B.2 of Attachment A provides that when a direct cost is of minor amounts,it may
be treated as an indirect cost for reasons of practicality and efficiency,provided that the accounting
treatment for such cost is consistently applied to all final cost objectives. Therefore,when malpractice
insurance costs for nurses or lab technicians are immaterial in relation to its effect on the overall indirect
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cost rates of the organization,they may be treated as indirect costs.
Memberships
Comment: Membership costs in civic and community organizations should be allowable.
Response: Membership costs are allowable for business and professional organizations. The Circular is
further revised to allow membership costs in civic and community organizations when associations with
these organizations are essential to the performance of the Federal programs(as an outreach function).
These membership costs must be approved by the Federal cognizant agency.
Comment: Costs of membership in organizations that lobby should be unallowable.
Response: Paragraph 25 of the Circular disallows lobbying costs. Membership dues to lobbying
organizations are therefore unallowable. The unallowable portion of membership dues is determined by the
percentage of lobbying activities versus other allowable activities of the lobbying organization.
Selling or Marketing of Goods and Services
Comment: Clarification is needed for what types of activities are considered to be the selling or marketing
of goods and services,
Response: Selling or marketing of goods and services generally include an organization's efforts to market
the organization's products or services such as through advertising,organizational image enhancement,
market planning and direct selling. Direct selling efforts are those acts or actions used to induce particular
customers to purchase particular products or services of the organization. The allowability provisions for
advertising costs are described in paragraph 1.
Comment: The guidelines for selling or marketing of goods and services should be consistent with those in
FAR 31.205.38(c)(1).
Response: FAR 31.205.38(c)(1)allows direct selling costs at commercial contractors if they are reasonable
in amount. By contrast to the commercial contract context,direct selling costs are generally not considered
to be necessary costs for the performance of Federal sponsored programs by non-profit organizations. In
those cases where they are essential for certain Federal sponsored programs,these costs can be charged as
direct costs to the Federal sponsored programs if they are approved by the Federal awarding agency.
Comment: Given that the Bayh-Dole Act encouraged technology transfer, selling or marketing costs of
goods or services should be allowable costs. At the minimum,these costs should be allowable as direct
costs to the Federal projects.
Response: The Circular is revised to allow selling or marketing costs as direct costs to some Federal
sponsored programs when approved by the Federal awarding agency.
Severance Pay
Comment: Early retirement benefits should be allowable costs.
Response: Early retirement benefit costs are allowable costs,subject to limitations, and are discussed in
subparagraph 6.f, Fringe Benefits, along with other forms of fringe benefits. Paragraph 49, Severance Pay,
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deals only with severance policy, i.e.,dismissal, and the reimbursement of its costs.
Comment: Guidelines for costs of severance pay to foreign nationals in excess of customary or prevailing
practices should be consistent with section 2151 of the Federal Acquisition Streamlining Act of 1994
(FASA).
Response: OMB agrees. The Circular is revised to be consistent with FASA guidelines for severance pay to
foreign nationals in excess of customary or prevailing practices. As a result, the Federal awarding agency
may allow these costs when they are necessary for the performance of the Federal sponsored programs.
Trustees' Travel
Comment: Several commenters opposed the proposal to disallow trustees'travel costs citing the difficulty
of retaining or obtaining members to serve voluntarily on the Board of Trustees(or Directors)of a
non-profit organization,if Board members have to pay for their own travel expenses to attend Board
meetings. The commenters added that since serving on a non-profit organization's Board is often not as
prestigious and desirable as serving on a University's Board(where trustees'travel costs are unallowable
under Circular A-21),non-reimbursement of the travel costs would inhibit the recruitment of Board
members.
Respon
se: OMB concurs that disallowing the reimbursement of trustees'travel costs could inhibit the
recruitment of qualified Board members(particularly at smaller non-profit organizations),thereby
hampering the operations of a non-profit organization. OMB also recognizes that trustees'travel costs are
reasonable and necessary business costs. As a result,trustees'travel costs remain allowable.
Comment: Trustees'travel costs should be allowable if they are reasonable. Some suggested tests for
reasonableness of trustees'travel costs are: limit number of allowed trips per year,restriction of trips to
organization's principal place of business or reasonable surroundings,distinction between scheduled Board
meetings and emergency Board meetings, and disallowance of first-class airfare travels.
Response: All costs charged to Federal projects must satisfy a reasonableness test. Although some of the
suggested reasonableness tests appear to be good,OMB does not believe it is necessary at this time to
impose specific restrictions on trustees'travel expenses. The reasonableness of a particular travel expense
remains at the judgement of Federal negotiators.
Comment: At Head Start organizations,some Trustee members are first sent for training in the operations
of a Head Start program. These travel costs related to training should be allowable.
Response: Travel costs related to training and education are allowable, subject to limitations,and are
addressed in paragraph 53 of the Circular,Training and education costs.
Comment: At Head Start organizations,there often are several advisory boards in addition to the Board of
Trustees(or Directors).These advisory boards are involved in day-to-day operations of the organizations
and often incur travel costs. Are these costs subject to the same restrictions as trustees'travel?
Response:Travel costs for members of advisory groups are allowable, subject to the limitations in
paragraph 55,Travel costs.
Multiple Allocation Basis(MAB)
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Comment: The multiple allocation method for calculating indirect costs rates is much more complicated
and burdensome than the simplified method and it will cost non-profit organizations much more to prepare
the indirect cost proposal. Several commenters recommended the flexibility of using one of the three
different allocation methods as they are currently described in the Circular. The multiple allocation basis
(MAB)should remain an optional allocation methodology rather than a required methodology for certain
organizations.
Response: The use of MAB for major non-profit organizations promotes consistency in the calculation and
the reporting of indirect costs. It would facilitate the accumulation of indirect cost data by cost components
(i.e., facilities and administration)and provide comparable rates between major research non-profit
organizations and universities. However, OMB recognizes that a conversion to MAB may require some
substantial changes in the organization's accounting system and that MAB is not practical for
single-function organizations. Therefore, the Circular continues to allow non-profit organizations to use
any of the current three allocation methodologies.
Comment: Several commenters suggested raising the threshold for the requirement to$25 million in direct
Federal funding. Several commenters also suggested an exemption from this requirement for
single-function organizations regardless of Federal funding levels.
Response: The Circular is revised to allow the use of the current three allocation methodologies for all
non-profit organizations. For organizations that receive more than$10 million in direct Federal funding, a
breakout of indirect costs into two components, facilities and administration, is required regardless of the
selected allocation methodology.
Comment: The allocation methodology for general administration under MAB on the basis of modified
total direct costs conflicts with the required methodology under Cost Accounting Standard(CAS)410
applicable to contracts using the salaries and wages basis. One commenter suggested that a fully
CAS-covered non-profit organization be exempted from the MAB requirement.
Response: MAB is not a requirement for non-profit organizations and remains one of the three available
methodologies in the Circular for computing indirect costs. In addition,CAS-covered non-profit
organizations should continue to follow CAS with respect to the measurement, assignment and allocation
of costs.
Comment: The revision should clarify that the modified total direct cost base should only include the first
$25,000 of a subcontract regardless of the period during which the project is started(consistent with OMB
Circular A-21).
Response: The modified total direct cost base,described in subparagraph D.3.fof the Circular,includes the
first $25,000 of each subgrant or subcontract regardless of the period covered by the subgrant or
subcontract. Subgrant or subcontract costs above$25,000 shall be excluded from the Modified total direct
cost base. For example, for a$300,000 subgrant that lasts three years,only the first$25,000 incurred on the
award should be included in the modified total direct cost base.
Administrative Cap of 26 percent
Comment: Most commenters strongly opposed the 26 percent administrative cap stating that such
limitation on cost reimbursement is arbitrary, capricious, and unnecessary. Some argued that a cap would
be financially disastrous to non-profit organizations because they receive most of their funding from
Federal sources(unlike universities). A detailed analysis is urged to determine the average administrative
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costs applicable to non-profit organizations,if an administrative cap is to be implemented at non-profit
organizations.
Response: Based on the comments against the implementation of an administrative cap at non-profit
organizations,OMB defers the consideration of establishing any administrative cap until better data on
indirect costs at non-profit organizations can be collected. If OMB believes that an administrative cap
should be implemented,it would be proposed in a subsequent notice.
Other
Comment: Attachment C of the Circular should be updated since a few listed organizations no longer exist.
Response: OMB agrees. Attachment C is updated to delete those organizations that no longer exist or are
no longer exempted from OMB Circular A-122. •
Franklin D. Raines
Director
Attachments A,B and C of Circular A-122 are revised as follows:
A.Attachment A
1. Add subparagraph 3 to paragraph C("Indirect Costs").
3. Indirect costs shall be classified within two broad categories: "Facilities" and "Administration."
"Facilities" is defined as depreciation and use allowances 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, library expenses and all other types of
expenditures not listed specifically under one of the subcategories of"Facilities" (including cross
allocations from other pools,where applicable). See indirect cost rate reporting requirements in
subparagraphs D.2.e and D.3.g.
2. Add subparagraph 2.e to paragraph D.
e. For an organization that receives more than$10 million in Federal funding of direct costs in a fiscal year,
a breakout of the indirect cost component into two broad categories,Facilities and Administration as
defined in subparagraph C.3, is required.The rate in each case shall be stated as the percentage which the
amount of the particular indirect cost category(i.e.,Facilities or Administration)is of the distribution base
identified with that category.
3. Replace subparagraph D.3 with the following:
3. Multiple allocation base method.
a.General. Where an organization's indirect costs benefit its major functions in varying degrees, indirect
costs shall be accumulated into separate cost groupings,as described in subparagraph b. Each grouping
shall then be allocated individually to benefitting functions by means of a base which best measures the
relative benefits. The default allocation bases by cost pool are described in subparagraph c.
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b. Identification of indirect costs. Cost groupings shall be established so as to permit the allocation of each
grouping on the basis of benefits provided to the major functions. Each grouping shall constitute a pool of
expenses that are of like character in terms of functions they benefit and in terms of the allocation base
which best measures the relative benefits provided to each function. The groupings are classified within the
two broad categories: "Facilities"and"Administration,"as described in subparagraph C.3. The indirect
cost pools are defined as follows:
(1)Depreciation and use allowances. The expenses under this heading are the portion of the costs of the
organization's buildings,capital improvements to land and buildings, and equipment which are computed
in accordance with paragraph 11 of Attachment B("Depreciation and use allowances").
(2)Interest. Interest on debt associated with certain buildings,equipment and capital improvements are
computed in accordance with paragraph 23 of Attachment B("Interest, fund raising, and investment
management costs").
(3)Operation and maintenance expenses. The expenses under this heading are those that have been
incurred for the administration, operation, maintenance,preservation, and protection of the organization's
physical plant. They include expenses normally incurred for such items as:janitorial and utility services;
repairs and ordinary or normal alterations of buildings, furniture and equipment; care of grounds;
maintenance and operation of buildings and other plant facilities; security; earthquake and disaster
preparedness; environmental safety;hazardous waste disposal; property, liability and other insurance
relating to property; space and capital leasing; facility planning and management; and,central receiving.
The operation and maintenance expenses category shall also include its allocable share of fringe benefit
costs, depreciation and use allowances,and interest costs.
(4) General administration and general expenses. The expenses under this heading are those that have been
incurred for the overall general executive and administrative offices of the organization and other expenses
of a general nature which do not relate solely to any major function of the organization. This category shall
also include its allocable share of fringe benefit costs,operation and maintenance expense,depreciation
and use allowances, and interest costs. Examples of this category include central offices, such as the
director's office, the office of finance,business services,budget and planning,personnel, safety and risk
management,general counsel, management information systems, and library costs.
In developing this cost pool, special care should be exercised to ensure that costs incurred for the same
purpose in like circumstances are treated consistently as either direct or indirect costs. For example,
salaries of technical staff,project supplies,project publication,telephone toll charges,computer costs,
travel costs, and specialized services costs shall be treated as direct costs wherever identifiable to a:
particular program. The salaries and wages of administrative and pooled clerical staff should normally be
treated as indirect costs. Direct charging of these costs may be appropriate where a major project or activity
explicitly requires and budgets for administrative or clerical services and other individuals involved can be
identified with the program or activity. Items such as office supplies,postage, local telephone costs,
periodicals and memberships should normally be treated as indirect costs.
c. Allocation bases. Actual conditions shall be taken into account in selecting the base to be used in.
allocating the expenses in each grouping to benefitting functions. The essential consideration in selecting a
method or a base is that it is the one best suited for assigning the pool of costs to cost objectives in
accordance with benefits derived; a traceable cause and effect relationship;or logic and reason,where
neither the cause nor the effect of the relationship is determinable. When an allocation can be made by
assignment of a cost grouping directly to the function benefited, the allocation shall be made in that
manner. When the expenses in a cost grouping are more general in nature, the allocation shall be made
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through the use of a selected base which produces results that are equitable to both the Federal Government
and the organization. The distribution shall be made in accordance with the bases described herein unless it
can be demonstrated that the use of a different base would result in a more equitable allocation of the costs,
or that a more readily available base would not increase the costs charged to sponsored awards. The results
of special cost studies(such as an engineering utility study)shall not be used to determine and allocate the
indirect costs to sponsored awards.
(1)Depreciation and use allowances.Depreciation and use allowances expenses shall be allocated in the
following manner:
(a)Depreciation or use allowances on buildings used exclusively in the conduct of a single function, and on
capital improvements and equipment used in such buildings, shall be assigned to that function.
(b)Depreciation or use allowances on buildings used for more than one function, and on capital
improvements and equipment used in such buildings,shall be allocated to the individual functions
performed in each building on the basis of usable square feet of space,excluding common areas, such as
hallways,stairwells,and restrooms.
(c)Depreciation or use allowances on buildings,capital improvements and equipment related space(e.g.,
individual rooms,and laboratories)used jointly by more than one function(as determined by the users of
the space)shall
treated as follows.The cost of each jointly used unit of space ace shall be allocated to the
benefitting functions on the basis of:
(i)the employees and other users on a full-time equivalent(FTE)basis or salaries and wages of those
individual functions benefitting from the use of that space;or
(ii)organization-wide employee FTEs or salaries and wages applicable to the benefitting functions of the
organization.
(d)Depreciation or use allowances on certain capital improvements to land, such as paved parking areas,
fences,sidewalks,and the like,not included in the cost of buildings,shall be allocated to user categories on
a FTE basis and distributed to major functions in proportion to the salaries and wages of all employees
applicable to the functions.
(2)Interest. Interest costs shall be allocated in the same manner as the depreciation or use allowances on
the buildings, equipment and capital equipments to which the interest relates.
(3)Operation and maintenance expenses. Operation and maintenance expenses shall be allocated in the
same manner as the depreciation and use allowances.
(4)General administration and general expenses. General administration and general expenses shall be
allocated to benefitting functions based on modified total direct costs(MTDC), as described in
subparagraph D.3.f.The expenses included in this category could be grouped first according to major
functions of the organization to which they render services or provide benefits. The aggregate expenses of
each group shall then be allocated to benefitting functions based on MTDC.
d. Order of distribution.
(1)Indirect cost categories consisting of depreciation and use allowances,interest,operation and
maintenance,and general administration and general expenses shall be allocated in that order to the
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remaining indirect cost categories as well as to the major functions of the organization. Other cost
categories could be allocated in the order determined to be most appropriate by the organization. When
cross allocation of costs is made as provided in subparagraph(2),this order of allocation does not apply.
(2)Normally, an indirect cost category will be considered closed once it has been allocated to other cost
objectives,and costs shall not be subsequently allocated to it. However, a cross allocation of costs between
two or more indirect costs categories could be used if such allocation will result in a more equitable
allocation of costs. If a cross allocation is used, an appropriate modification to the composition of the
indirect cost categories is required.
e. Application of indirect cost rate or rates. Except where a special indirect cost rate(s)is required in
accordance with subparagraph D.5, the separate groupings of indirect costs allocated to each major
function shall be aggregated and treated as'a common pool for that function. The costs in the common pool
shall then be distributed to individual awards included in that function by use of a single indirect cost rate.
f. Distribution basis. Indirect costs shall be distributed to applicable sponsored awards and other benefitting
activities within each major function on the basis of MTDC. MTDC consists of all salaries and wages,
fringe benefits, materials and supplies, services,travel, and subgrants and subcontracts up to the first
$25,000 of each subgrant or subcontract(regardless of the period covered by the subgrant or subcontract).
Equipment, capital expenditures,charges for patient care, rental costs and the portion in excess of$25,000
shall be excluded from MTDC. Participant support costs shall generally be excluded from MTDC. Other
items may only be excluded when the Federal cost cognizant agency determines that an exclusion is
necessary to avoid a serious inequity in the distribution of indirect costs.
g. Individual Rate Components. An indirect cost rate shall be determined for each separate indirect cost
pool developed. The rate in each case shall be stated as the percentage which the amount of the particular
indirect cost pool is of the distribution base identified with that pool. Each indirect cost rate negotiation or
determination agreement shall include development of the rate for each indirect cost pool as well as the
overall indirect cost rate. The indirect cost pools shall be classified within two btoad categories: "Facilities"
and "Administration," as described in subparagraph C.3.
B. Attachment B
Revise the following cost items in Attachment B to Circular A-122("Selected Items of Cost").
1. Revise the Table of Contents for Attachment B to read:
1. Advertising and public relations costs
2. Alcoholic beverages
3. Bad debts
4. Bid and proposal costs(reserved)
5. Bonding costs
6. Communication costs
7. Compensation for personal services
8. Contingency provisions
9. Contributions
10. Defense and prosecution of criminal and civil proceedings,claims, appeals and patent infringement
11. Depreciation and use allowances
12. Donations
13. Employee morale, health, and welfare costs and credits
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14. Entertainment costs
15. Equipment and other capital expenditures
16. Fines and penalties
17. Fringe benefits
18. Goods or services for personal use
19.Housing and personal living expenses
20. Idle facilities and idle capacity
21. Independent research and development(reserved)
22. Insurance and indemnification
23. Interest, fund raising, and investment management costs
24. Labor relations costs
25. Lobbying costs
26. Losses on other awards
27. Maintenance and repair costs
28.Materials and supplies
29. Meetings and conferences
30.Memberships,subscriptions,and professional activity costs
31. Organization costs
32.Overtime,extra-pay shift,and multi-shift premiums
33. Page charges in professional journals
34. Participant support costs
35.Patent costs •
36. Pension plans
37.Plant security costs
38. Pre-award costs
39. Professional service costs
40. Profits and losses on disposition of depreciable property or other capital assets
41. Publication and printing costs
42. Rearrangement and alteration costs
43. Reconversion costs
44. Recruiting costs
45. Relocation costs
46. Rental costs
47.Royalties and other costs for use of patents and copyrights
48. Selling and marketing
49. Severance pay
50. Specialized service facilities
51. Taxes
52.Termination costs
53. Training and education costs
54.Transportation costs
55.Travel costs
56.Trustees
2. Revise and retitle paragraph 1 to read:
1. Advertising and public relations costs.
a.The term advertising costs means the costs of advertising media and corollary administrative costs.
Advertising media include magazines,newspapers,radio and television programs,direct mail,exhibits,
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and the like.
b. The term public relations includes community relations and means those activities dedicated to
maintaining the image of the organization or maintaining or promoting understanding and favorable
relations with the community or public at large or any segment of the public.
c. The only allowable advertising costs are those which are solely for:
(1)The recruitment of personnel required for the performance by the organization of obligations arising
under a sponsored award, when considered in conjunction with all other recruitment costs, as set forth in
paragraph 44("Recruiting costs");
(2) The procurement of goods and services for the performance of a sponsored award;
(3)The disposal of scrap or surplus materials acquired in the performance of a sponsored award except
when organizations are reimbursed for disposal costs at a predetermined amount in accordance with OMB
Circular A-110,Sec. .34, "Equipment"; or
(4) Other specific purposes necessary to meet the requirements of the sponsored award.
d. The only allowable public relations costs are:
(1)Costs specifically required by sponsored awards;
(2) Costs of communicating with the public and press pertaining to specific activities or accomplishments
which result from performance of sponsored awards(these costs are considered necessary as part of the
outreach effort for the sponsored awards); or
(3)Costs of conducting general liaison with news media and government public relations officers,to the
extent that such activities are limited to communication and liaison necessary to keep the public informed
on matters of public concern, such as notices of contract/grant awards, financial matters, etc.
e. Costs identified in subparagraphs c and d if incurred for more than one sponsored award or for both
sponsored work and other work of the organization, are allowable to the extent that the principles in
paragraphs B("Direct Costs")and C("Indirect Costs")of Attachment A are observed.
f. Unallowable advertising and public relations costs include the following:
(1)All advertising and public relations costs other than as specified in subparagraphs c,d,and e;
I
(2)Costs of meetings or other events related to fund raising or other organizational a I tivities including:
(i)Costs of displays, demonstrations, and exhibits;
(ii)Costs of meeting rooms, hospitality suites, and other special facilities used in conjunction with shows
and other special events; and
(iii) Salaries and wages of employees or cost of services engaged in setting up and displaying exhibits,
making demonstrations, and providing briefings;
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(3)Costs of promotional items and memorabilia, including models, gifts, and souvenirs;
(4)Costs of advertising and public relations designed solely to promote the organization.
3. Renumber current paragraphs 2 through 8 as paragraphs 3 through 9,respectively.
4. Add the following new paragraph 2:
2. Alcoholic beverages. Costs of alcoholic beverages are unallowable.
5. In paragraph 7("Compensation for personal services"), as renumbered above in item 3,rename the
current subparagraph g("Pension costs"),as subparagraph h. Add a new subparagraph g:
g. Organization-furnished automobiles. That portion of the cost of organization-furnished automobiles
that relates to personal use by employees(including transportation to and from work)is unallowable as
fringe benefit or indirect costs regardless of whether the cost is reported as taxable income to the
employees. These costs are allowable as direct costs to sponsored award when necessary for the
performance of the sponsored award and approved by awarding agencies.
6. Renumber current paragraphs 9 through 15 as paragraphs 11 through 17, respectively.
7. Add new paragraph 10:
10. Defense and prosecution of criminal and civil proceedings,claims,appeals and patent
infringement.
a. Definitions.
(1)Conviction, as used herein,means a judgment or a conviction of a criminal offense by any court of
competent jurisdiction,whether entered upon as a verdict or a plea,including a conviction due to a plea of
nolo contendere.
(2)Costs include,but are not limited to, administrative and clerical expenses;the cost of legal services,
whether performed by in-house or private counsel;and the costs of the services of accountants,consultants,
or others retained by the organization to assist it; costs of employees,officers and trustees,and any similar
costs incurred before,during, and after commencement of a judicial or administrative proceeding that bears
a direct relationship to the proceedings.
(3)Fraud, as used herein,means(i)acts of fraud corruption or attempts to defraud the Federal Government
or to corrupt its agents,(ii)acts that constitute a cause for debarment or suspension(as specified in agency
regulations), and(iii)acts which violate the False Claims Act, 31 U.S.C., sections 3729-3731,or the
Anti-Kickback Act,41 U.S.C., sections 51 and 54.
(4)Penalty does not include restitution,reimbursement,or compensatory damages.
(5)Proceeding includes an investigation.
b.(1) Except as otherwise described herein,costs incurred in connection with any criminal,civil or
administrative proceeding(including filing of a false certification)commenced by the Federal Government,
or a State, local or foreign government, are not allowable if the proceeding: (1)relates to a violation of,or
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failure to comply with,a Federal, State, local or foreign statute or regulation by the organization(including
its agents and employees),and(2)results in any of the following dispositions:
(a)In a criminal proceeding,a conviction.
(b)In a civil or administrative proceeding involving an allegation of fraud or similar misconduct, a
determination of organizational liability.
(c)In the case of any civil or administrative proceeding;the imposition of a monetary penalty.
(d)A final decision by an appropriate Federal official to debar or suspend the organization, to rescind or
void an award,or to terminate an award for default by reason of a violation or failure to comply with a law
or regulation.
(e)A disposition by consent or compromise, if the action could have resulted in any of the dispositions
described in(a),(b),(c)or(d).
(2)If more than one proceeding involves the same alleged misconduct, the costs of all such proceedings
shall be unallowable if any one of them results in one of the dispositions shown in subparagraph b.(l).
c. If a proceeding referred to in subparagraph b is commenced by the Federal Government and is resolved
by consent or compromise pursuant to an agreement entered into by the organization and the Federal
Government,then the costs incurred by the organization in connection with such proceedings that are
otherwise not allowable under subparagraph b may be allowed to the extent specifically provided in such
agreement.
d. If a proceeding referred to in subparagraph b is commenced by a State, local or foreign government,the
authorized Federal official may allow the costs incurred by the organization for such proceedings, if such
authorized official determines that the costs were incurred as a result of(1)a specific term or condition of a
federally-sponsored award,or(2) specific written direction of an authorized official of the sponsoring
agency.
e. Costs incurred in connection with proceedings described in subparagraph b,but which are not made
unallowable by that subparagraph,may be allowed by the Federal Government,but only to the extent that:
(1)The costs are reasonable in relation to the activities required to deal with the proceeding and the
underlying cause of action;
(2)Pa1,
yment of the costs incurred, as allowable and allocable costs, is not prohibited by any other
provision(s)of the sponsored award;
(3)The costs are not otherwise recovered from the Federal Government or a third party,either directly as a
result of the proceeding or otherwise; and,.
(4) The percentage of costs allowed does not exceed the percentage determined by an authorized Federal
official to be appropriate, considering the complexity of the litigation,generally accepted principles
governing the award of legal fees in civil actions involving the United States as a party,and such other
factors as may be appropriate. Such percentage shall not exceed 80 percent, However, if an agreement
reached under subparagraph c has explicitly considered this 80 percent limitation and permitted a higher
percentage, then the full amount of costs resulting from that agreement shall be allowable.
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f.Costs incurred by the organization in connection with the defense of suits brought by its employees or
ex-employees under section 2 of the Major Fraud Act of 1988(Pub. L. 100-700), including the cost of all
relief necessary to make such employee whole,where the organization was found liable or settled, are
unallowable.
g. Costs of legal,accounting, and consultant services,and related costs, incurred in connection with
defense against Federal Government claims or appeals,antitrust suits,or the prosecution of claims or
appeals against the Federal Government,are unallowable.
h. Costs of legal,accounting,and consultant services,and related costs, incurred in connection with patent
infringement litigation, are unallowable unless otherwise provided for in the sponsored awards.
i. Costs which may be unallowable under this paragraph, including directly associated costs, shall be
segregated and accounted for by the organization separately. During the pendency of any proceeding
covered by subparagraphs b and f,the Federal Government shall generally withhold payment of such costs.
However,if in the best interests of the Federal Government, the Federal Government may provide for
conditional payment upon provision of adequate security,or other adequate assurance, and agreements by
the organization to repay all unallowable costs,plus interest,if the costs are subsequently determined to be
unallowable.
8. In paragraph 15 ("Equipment and other capital expenditures"),as renumbered in item 6 above,replace
subparagraphs 15.a.(1)and 15.b.(2)to read:
15.a.(1)"Equipment" means an article of nonexpendable,tangible personal property having a useful life of
more than one year and an acquisition cost which equals or exceeds the lesser of(a)the capitalization level
established by the organization for the financial statement purposes,or(b)$5000. The unamortized portion
of any equipment written off as a result of a change in capitalization levels may be recovered by continuing
equipment,oramortizingthe
to claim the otherwise allowable use allowances or depreciation on theby
amount to be written off over a period of years as negotiated with the Federal cognizant agency.
15.b.(2)Capital expenditures for special purpose equipment are allowable as direct costs,provided that
items with a unit cost of$5000 or more have the prior approval of awarding agency.
9. Renumber current paragraphs 16 through 36 as paragraphs 20 through 40, respectively.
10. Add new paragraph 18:
18. Goods or services for personal use. Costs of goods or services for personal use of the organization's
employees are unallowable regardless of whether the cost is reported as taxable income to the employees.
11. Add new paragraph 19:
19. Housing and personal living expenses.
a. Costs of housing(e.g.,depreciation,maintenance, utilities, furnishings,rent, etc.),housing allowances
and personal living expenses for/of the organization's officers are unallowable as fringe benefit or indirect
costs regardless of whether the cost is reported as taxable income to the employees. These costs are
awards when necessary as direct costs to sponsored for the performance of the sponsored award
and approved by awarding agencies.
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b. The term "officers" includes current and past officers and employees.
12:add to paragraph 22.a.(2)("Insurance and indemnification"),as renumbered in item 9, subparagraphs
(f)and(g):
(f)Insurance against defects. Costs of insurance with respect to any costs incurred to correct defects in the
.organization's materials or workmanship are unallowable..
(g)Medical liability(malpractice) insurance. Medical liability insurance is an allowable cost of Federal
research programs only to the extent that the Federal research programs involve human subjects or training
of participants in research techniques. Medical liability insurance costs shall be treated as a direct cost and
shall be assigned to individual projects based on the manner in which the insurer allocates the risk to the
population covered by the insurance.
13. Revise paragraph 30, as renumbered in item 9,to read:
30. Memberships,subscriptions and professional activity costs.
a. Costs of the organization's membership in business, technical, and professional organizations are
allowable.
b. Costs of the organization's subscriptions to business,professional,and technical periodicals are
allowable.
c. Costs of meetings and conferences,when the primary purpose is the dissemination of technical
information, are allowable. This includes costs of meals,transportation, rental of facilities,and other items
incidental to such meetings or conferences.
d. Costs of membership in any civic or community organization are allowable with prior approval by
Federal cognizant agency.
e. Costs of membership in any country club or social or dining club or organization are unallowable.
14. Delete subparagraph 39.d, as renumbered in item 9.
15. Delete current paragraph 37 ("Public service costs").
16. Renumber current paragraphs 38 through 44 as paragraphs 41 through 47,respectively.
17. Revise paragraph 44, as renumbered in item 16, to read:
44. Recruiting costs.
a. Subject to subparagraphs b, c, and d, and provided that the size of the staff recruited and maintained is in
keeping with workload requirements, costs of"help wanted"advertising,operating costs of an employment
office necessary to secure and maintain an adequate staff,costs of operating an aptitude and educational
testing program, travel costs of employees while engaged in recruiting personnel, travel costs of applicants
for interviews for prospective employment, and relocation costs incurred incident to recruitment of new
employees, are allowable to the extent that such costs are incurred pursuant to a well-managed recruitment
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program. Where the organization uses employment agencies,costs that are not in excess of standard
commercial rates for such services are allowable.
b.In publications,costs of help wanted advertising that includes color, includes advertising material for
other than recruitment purposes,or is excessive in size(taking into consideration recruitment purposes for
which intended and normal organizational practices in this respect),are unallowable.
c. Costs of help wanted advertising, special emoluments, fringe benefits, and salary allowances incurred to
attract professional personnel from other organizations that do not meet the test of reasonableness or do not
conform with the established practices of the organization, are unallowable.
d. Where relocation costs incurred incident to recruitment of a new employee have been allowed either as
an allocable direct or indirect cost, and the newly hired employee resigns for reasons within his control
within twelve months after being hired,the organization will be required to refund or credit such relocation
costs to the Federal Government.
•
18. Renumber current paragraphs 45 through 51 as paragraphs 49 through 55,respectively.
19. Add new paragraph 48:
48. Selling and marketing. Costs of selling and marketing any products or services of the organization
(unless allowed under paragraph 1 as allowable public relations costs)are unallowable. These costs,
however, are allowable as direct costs,with prior approval by awarding agencies,when they are necessary
for the performance of Federal programs.
20. Add new subparagraphs c,d and e to paragraph 49("Severance pay"),as renumbered in item 18, as
follow:
c. Costs incurred in certain severance pay packages(commonly known as"a golden parachute" payment)
which are in an amount in excess of the normal severance pay paid by the organization 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 organization's assets are unallowable.
d. Severance payments to foreign nationals employed by the organization outside the United States,to the
extent that the amount exceeds the customary or prevailing practices for the organization in the United
States are unallowable, unless they are necessary for the performance of Federal programs and approved by
awarding agencies.
e. Severance payments to foreign nationals employed by the organization 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
organization in that country, are unallowable,unless they are necessary for the performance of Federal
programs and approved by awarding agencies.
21. Add new paragraph 56:
56.Trustees. Travel and subsistence costs of trustees(or directors)are allowable. The costs are subject to
restrictions regarding lodging,subsistence and air travel costs provided in paragraph 55.
C.Attachment C
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1. Delete the following organizations from Attachment C. These organizations either no longer exist or are
no longer exempted from complying with Circular A-122.
• Associated Universities, Incorporated, Washington,D.C.
• Associated Universities for Research and Astronomy, Tucson,Arizona
• Center for Energy and Environmental Research(CEER), (University of Puerto Rico),
Commonwealth of Puerto Rico
. • Comparative Animal Research Laboratory(CARL), (University of Tennessee),Oak Ridge,
Tennessee
• Institute of Gas Technology,Chicago, Illinois
• Montana Energy Research and Development Institute, Inc., (MERDI),Butte, Montana
• Project Management Corporation, Oak Ridge, Tennessee
• Sandia Corporation,Albuquerque, New Mexico
• Universities Corporation for Atmospheric Research, Boulder, Colorado
2. Change Argonne Universities Association, Chicago, Illinois to Argonne National Laboratory,Chicago,
Illinois.
3. Change the location of the Institute for Defense Analysis in Virginia from Arlington to Alexandria.
4. Replace Midwest Research Institute,Headquartered in Kansas City,Missouri to National Renewable
Energy Laboratory, Golden, Colorado.
D. A recompilation of the entire Circular A-122, with all its amendments, follows:
CIRCULAR NO. A-122
Revised
TO THE HEADS OF EXECUTIVE DEPARTMENTS AND ESTABLISHMENTS
SUBJECT: Cost Principles for Non-Profit Organizations
1. Purpose. This Circular establishes principles for determining costs of grants, contracts and other
agreements with non-profit organizations. It does not apply to colleges and universities which are covered
by Office of Management and Budget(OMB)Circular A-21,"Cost Principles for Educational Institutions";
State, local, and federally-recognized Indian tribal governments which are covered by OMB Circular A-87,
"Cost Principles for State, Local, and Indian Tribal Governments";or hospitals. The principles are designed
to provide that the Federal Government bear its fair share of costs except where restricted or prohibited by
law. The principles do not attempt to prescribe the extent of cost sharing or matching on grants,contracts,
or other agreements. However, such cost sharing or matching shall not be accomplished through arbitrary
limitations on individual cost elements by Federal agencies. Provision for profit or other increment above
•
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cost is outside the scope of this Circular.
2. Supersession. This Circular supersedes cost principles issued by individual agencies for non-profit
organizations.
3. Applicability.
a. These principles shall be used by all Federal agencies in determining the costs of work performed by
non-profit organizations under grants,cooperative agreements,cost reimbursement contracts,and other
contracts in which costs are used in pricing, administration,or settlement. All of these instruments are
hereafter referred to as awards. The principles do not apply to awards under which an organization is not
required to account to the Federal Government for actual costs incurred.
b. All cost reimbursement subawards(subgrants, subcontracts,etc.)are subject to those Federal cost
principles applicable to the particular organization concerned. Thus, if a subaward is to a non-profit
organization,this Circular shall apply; if a subaward is to a commercial organization,the cost principles
applicable to commercial concerns shall apply; if a subaward is to a college or university, Circular A-21
shall apply; if a subaward is to a State, local,or federally-recognized Indian tribal government,Circular
A-87 shall apply.
4. Definitions.
a. Non-profit organization means any corporation,trust, association,cooperative,or other organization
which:
(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 its net proceeds to maintain, improve, and/or expand its operations. For this purpose,the term
"non-profit organization" excludes(i)colleges and universities;(ii)hospitals;(iii) State, local,and
federally-recognized Indian tribal governments; and(iv)those non-profit organizations which are excluded
from coverage of this Circular in accordance with paragraph 5.
b. Prior approval means securing the awarding agency's permission in advance to incur cost for those
items that are designated as requiring prior approval by the Circular. Generally this permission will be in
writing. Where an item of cost requiring prior approval is specified in the budget of an award,approval of
the budget constitutes approval of that cost.
5. Exclusion of some non-profit organizations. Some non-profit organizations,because of their size and
nature of operations,can be considered to be similar to commercial concerns for purpose of applicability of
cost principles. Such non-profit organizations shall operate under Federal cost principles applicable to
commercial concerns. A listing of these organizations is contained in Attachment C. Other organizations
may be added from time to time.
6. Responsibilities. Agencies responsible for administering programs that involve awards to non-profit
organizations shall implement the provisions of this Circular.Upon request, implementing instruction shall
be furnished to OMB. Agencies shall designate a liaison official to serve as the agency representative on
matters relating to the implementation of this Circular. The name and title of such representative shall be
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furnished to OMB within 30 days of the date of this Circular.
7. Attachments. The principles and related policy guides are set forth in the following Attachments:
Attachment A-General Principles
Attachment B - Selected Items of Cost
Attachment C -Non-Profit Organizations Not Subject.To This Circular
8. Requests for exceptions. OMB may grant exceptions to the requirements of this Circular when
permissible under existing law. However, in the interest of achieving maximum uniformity, exceptions will
be permitted only in highly unusual circumstances.
9. Effective Date. The provisions of this Circular are effective immediately. Implementation shall be
phased in by incorporating the provisions into new awards made after the start of the organization's next
fiscal year. For existing awards,the new principles may be applied if an organization and the cognizant
Federal agency agree. Earlier implementation, or a delay in implementation of individual provisions, is also
permitted by mutual agreement between an organization and the cognizant Federal agency.
10. Inquiries. Further information concerning this Circular may be obtained by contacting the Office of
Federal Financial Management,OMB, Washington, DC 20503,telephone(202)395-3993.
Attachments
ATTACHMENT A
Circular No. A-122
GENERAL PRINCIPLES
Table of Contents
A. Basic Considerations
. 1. Composition of total costs
2. Factors affecting allowability of costs
3. Reasonable costs
4. Allocable costs �.
5. Applicable credits
6. Advance understandings
7. Conditional exemptions
B. Direct Costs
C. Indirect Costs
D. Allocation of Indirect Costs and Determination of Indirect Cost Rates
1. General
2. Simplified allocation method
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3.Multiple allocation base method
4. Direct allocation method
5. Special indirect cost rates
E.Negotiation and Approval of Indirect Cost Rates
1.Definitions
2.Negotiation and approval of rates
ATTACHMENT A
Circular No. A-122
GENERAL PRINCIPLES
A. Basic Considerations •
1. Composition of total costs. The total cost of an award is the sum of the allowable direct and allocable
indirect costs less any applicable credits.
2. Factors affecting allowability of costs. To be allowable under an award,costs must meet the following
general criteria:
a. Be reasonable for the performance of the award and be allocable thereto under these principles.
b. Conform to any limitations or exclusions set forth in these principles or in the award as to types or
amount of cost items.
c. Be consistent with policies and procedures that apply uniformly to both federally-financed and other
activities of the organization.
d.Be accorded consistent treatment.
e. Be determined in accordance with generally accepted accounting principles(GAAP).
f.Not be included as a cost or used to meet cost sharing or matching requirements of any other
federally-financed program in either the current or a prior period.
g.Be adequately documented.
3.Reasonable costs. A cost is reasonable if,in its nature or amount, it does not exceed that which would be
incurred by a prudent person under the circumstances prevailing at the time the decision was made to incur
the costs. The question of the reasonableness of specific costs must be scrutinized with particular care in
connection with organizations or separate divisions thereof which receive the preponderance of their
support from awards made by Federal agencies. In determining the reasonableness of a given cost,
consideration shall be given to:
a. Whether the cost is of a type generally recognized as ordinary and necessary for the operation of the
organization or the performance of the award.
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b. The restraints or requirements imposed by such factors as generally accepted sound business practices,
arms length bargaining,Federal and State laws and regulations,and terms and conditions of the award.
c. Whether the individuals concerned acted with prudence in the circumstances,considering their
responsibilities to the organization, its members,employees, and clients,the public at large, and the
Federal Government.
d. Significant deviations from the established practices of the organization which may unjustifiably
increase the award costs.
4.Allocable costs.
a. A cost is allocable to a particular cost objective, such as a grant,contract,project,service,or other
activity, in accordance with the relative benefits received. A cost is allocable to a Federal award if it is
treated consistently with other costs incurred for the same purpose in like circumstances and if it:
(1)Is incurred specifically for the award.
(2)Benefits both the award and other work and can be distributed in reasonable proportion to the benefits
received,or
(3) Is necessary to the overall operation of the organization, although a direct relationship to any particular
cost objective cannot be shown.
b. Any cost allocable to a particular award or other cost objective under these principles may not be shifted
to other Federal awards to overcome funding deficiencies,or to avoid restrictions imposed by law or by the
terms of the award.
5.Applicable credits.
a. The term applicable credits refers to those receipts,or reduction of expenditures which operate to offset
or reduce expense items that are allocable to awards as direct or indirect costs. Typical examples of such
transactions are: purchase discounts,rebates or allowances,recoveries or indemnities on losses,insurance
refunds, and adjustments of overpayments or erroneous charges. To the extent that such credits accruing or
received by the organization relate to allowable cost,they shall be credited to the Federal Government
either as a cost reduction or cash refund, as appropriate.
b. In some instances,the amounts received from the Federal Government to finance organizational
activities or service operations should be treated as applicable credits. Specifically,the concept of netting
such credit items against related expenditures should be applied by the organization in determining the
rates or amounts to be charged to Federal awards for services rendered whenever the facilities or other
resources used in providing such services have been financed directly, in whole or in part,by Federal
funds.
c. For rules covering program income(i.e., gross income earned from federally-supported activities)see
Sec. _.24 of Office of Management and Budget(OMB)Circular A-110, "Uniform Administrative
Requirements for Grants and Agreements with Institutions of Higher Education,Hospitals,and Other
Non-Profit Organizations."
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6.Advance understandings. Under any given award, the reasonableness and allocability of certain items of
costs may be difficult to determine. This is particularly true in connection with organizations that receive a
preponderance of their support from Federal agencies. In order to avoid subsequent disallowance or dispute
based on unreasonableness or nonallocability,it is often desirable to seek a written agreement with the
cognizant or awarding agency in advance of the incurrence of special or unusual costs. The absence of an
advance agreement on any element of cost will not, in itself,affect the reasonableness or allocability of that
element.
7. Conditional exemptions.
a. OMB authorizes conditional exemption from OMB administrative requirements and cost principles
circulars for certain Federal programs with statutorily-authorized consolidated planning and consolidated
administrative funding,that are identified by a Federal agency and approved by the head of the Executive
department or establishment. A Federal agency shall consult with OMB during its consideration of whether
to grant such an exemption.
b. To promote efficiency in State and local program administration, when Federal non-entitlement
programs with common purposes have specific statutorily-authorized consolidated planning and
consolidated administrative funding and where most of the State agency's resources come from non-Federal
sources,Federal agencies may exempt these covered State-administered,non-entitlement grant programs
from certain OMB grants management requirements.The exemptions would be from all but the allocability
of costs provisions of OMB Circulars A-87(Attachment A,subsection C.3), "Cost Principles for State,
Local, and Indian Tribal Governments,"A-21 (Section C,subpart 4), "Cost Principles for Educational
Institutions," and A-122(Attachment A, subsection A.4),"Cost Principles for Non-Profit Organizations,"
and from all of the administrative requirements provisions of OMB Circular A-110, "Uniform
Administrative Requirements for Grants and Agreements with Institutions of Higher Education, Hospitals,
and Other Non-Profit Organizations," and the agencies'grants management common rule.
c. When a Federal agency provides this flexibility,as a prerequisite to a States exercising this option, a
State must adopt its own written fiscal and administrative requirements for expending and accounting for
all funds,which are consistent with the provisions of OMB Circular A-87, and extend such policies to all
subrecipients. These fiscal and administrative requirements must be sufficiently specific to ensure that:
funds are used in compliance with all applicable Federal statutory and regulatory provisions,costs are
reasonable and necessary for operating these programs, and funds are not be used for general expenses
required to carry out other responsibilities of a State or its subrecipients.
B. Direct Costs
1. Direct costs are those that can be identified specifically with a particular final cost objective, i.e.,a
particular award,project, service,or other direct activity of an organization. However,a cost may not be
assigned to an award as a direct cost if any other cost incurred for the same purpose, in like circumstance,
has been allocated to an award as an indirect cost. Costs identified specifically with awards are direct costs
of the awards and are to be assigned directly thereto. Costs identified specifically with other final cost
objectives of the organization are direct costs of those cost objectives and are not to be assigned to other
awards directly or indirectly.
2. Any direct cost of a minor amount may be treated as an indirect cost for reasons of practicality where the
accounting treatment for such cost is consistently applied to all final cost objectives.
3. The cost of certain activities are not allowable as charges to Federal awards(see, for example,
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fundraising costs in paragraph 23 of Attachment B). However,even though these costs are unallowable
for purposes of computing charges to Federal awards, they nonetheless must be treated as direct costs for
purposes of determining indirect cost rates and be allocated their share of the organization's indirect costs if
they represent activities which(1)include the salaries of personnel,(2)occupy space, and(3)benefit from
the organization's indirect costs.
4. The costs of activities performed primarily as a service to members,clients,or the general public when
significant and necessary to the organization's mission must be treated as direct costs whether or not
allowable and be allocated an equitable share of indirect costs. Some examples of these types of activities
include:
a. Maintenance of membership rolls, subscriptions,publications, and related functions.
b. Providing services and information to members, legislative or administrative bodies,or the public.
c. Promotion, lobbying,and other forms of public relations.
d. Meetings and conferences except those held to conduct the general administration of the organization.
e. Maintenance,protection, and investment of special funds not used in operation of the organization.
f. Administration of group benefits on behalf of members or clients, including life and hospital insurance,
annuity or retirement plans, financial aid,etc.
C. Indirect Costs
1. Indirect costs are those that have been incurred for common or joint objectives and cannot be readily
identified with a_particular final cost objective. Direct cost of minor amounts may be treated as indirect
costs under the conditions described in subparagraph B.2. After direct costs have been determined and
assigned directly to awards or other work as appropriate, indirect costs are those remaining to be allocated
to benefiting cost objectives. A cost may not be allocated to an award as an indirect cost if any other cost
incurred for the same purpose, in like circumstances,has been assigned to an award as a direct cost.
2. Because of the diverse characteristics and accounting practices of non-profit organizations, it is not
possible to specify the types of cost which may be classified as indirect cost in all situations. However,
typical examples of indirect cost for many non-profit organizations may include depreciation or use
allowances on buildings and equipment, the costs of operating and maintaining facilities,and general
administration and general expenses, such as the salaries and expenses of executive officers,personnel
administration,and accounting.
3. Indirect costs shall be classified within two broad categories: "Facilities" and"Administration."
"Facilities" is defined as depreciation and use allowances 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, library expenses and all other types of
expenditures not listed specifically under one of the subcategories of"Facilities"(including cross
allocations from other pools, where applicable). See indirect cost rate reporting requirements in
subparagraphs D.2.e and D.3.g.
D. Allocation of Indirect Costs and Determination of Indirect Cost Rates
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1. General.
a. Where a non-profit organization has only one major function,or where all its major functions benefit
from its indirect costs to approximately the same degree,the allocation of indirect costs and the
computation of an indirect cost rate may be accomplished through simplified allocation procedures,as
described in subparagraph 2.
b.Where an organization has several major functions which benefit from its indirect costs in varying
degrees,allocation of indirect costs may require the accumulation of such costs into separate cost
groupings which then are allocated individually to benefiting functions by means of a base which best
measures the relative degree of benefit. The indirect costs allocated to each function are then distributed to
individual awards and other activities included in that function by means of an indirect cost rate(s).
c. The determination of what constitutes an organization's major functions will depend on its purpose in
being;the types of services it renders to the public,its clients, and its members; and the amount of effort it
devotes to such activities as fundraising,public information and membership activities.
d. Specific methods for allocating indirect costs and computing indirect cost rates along with the conditions
under which each method should be used are described in subparagraphs 2 through 5.
e. The base period for the allocation of indirect costs is the period in which such costs are incurred and
accumulated for allocation to work performed in that period. The base period normally should coincide
with the organization's fiscal year but,in any event, shall be so selected as to avoid inequities in the
allocation of the costs.
2. Simplified allocation method.
a. Where an organization's major functions benefit from its indirect costs to approximately the same
degree,the allocation of indirect costs may be accomplished by(i) separating the organization's total costs
for the base period as either direct or indirect, and(ii)dividing the total allowable indirect costs(net of
applicable credits)by an equitable distribution base. The result of this process is an indirect cost rate which
is used to distribute indirect costs to individual awards. The rate should be expressed as the percentage
which the total amount of allowable indirect costs bears to the base selected. This method should also be
used where an organization has only one major function encompassing a number of individual projects or
activities, and may be used where the level of Federal awards to an organization is relatively small.
b. Both the direct costs and the indirect costs shall exclude capital expenditures and unallowable costs.
However, unallowable costs which represent activities must be included in the direct costs under the
conditions described in subparagraph B.3.
c.The distribution base may be total direct costs(excluding capital expenditures and other distorting items,
orsub ants direct salaries and wages,or other base which results in an
such as major subcontracts subgrants), g
equitable distribution. The distribution base shall generally exclude participant support costs as defined in
paragraph 34 of Attachment B.
d. Except where a special rate(s)is required in accordance with subparagraph 5,the indirect cost rate
developed under the above principles is applicable to all awards at the organization. If a special rate(s)is
required, appropriate modifications shall be made in order to develop the special rate(s).
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e. For an organization that receives more than$10 million in Federal funding of direct costs in a fiscal year,
a breakout of the indirect cost component into two broad categories,Facilities and Administration as
defined in subparagraph C.3, is required. The rate in each case shall be stated as the percentage which the
amount of the particular indirect cost category(i.e.,Facilities or Administration)is of the distribution base
identified with that category.
3. Multiple allocation base method
a. General. Where an organization's indirect costs benefit its major functions in varying degrees,indirect
costs shall be accumulated into separate cost groupings,as described in subparagraph b. Each grouping
shall then be allocated individually to benefitting functions by means of a base which best measures the
relative benefits. The default allocation bases by cost pool are described in subparagraph c.
b. Identification of indirect costs. Cost groupings shall be established so as to permit the allocation of each
grouping on the basis of benefits provided to the major functions. Each grouping shall constitute a pool of
expenses that are of like character in terms of functions they benefit and in terms of the allocation base
which best measures the relative benefits provided to each function. The groupings are classified within the
two broad categories: "Facilities" and "Administration,"as described in subparagraph C.3. The indirect
cost pools are defined as follows:
(1)Depreciation and use allowances. The expenses under this heading are the portion of the costs of the
organization's buildings,capital improvements to land and buildings,and equipment which are computed
in accordance with paragraph 11 of Attachment B("Depreciation and use allowances").
(2)Interest. Interest on debt associated with certain buildings,equipment and capital improvements are
computed in accordance with paragraph 23 of Attachment B("Interest, fundraising, and investment
management costs").
(3) Operation and maintenance expenses. The expenses under this heading are those that have been
incurred for the administration,operation,maintenance,preservation,and protection of the organization's
physical plant. They include expenses normally incurred for such items as:janitorial and utility services;
repairs and ordinary or normal alterations of buildings,furniture and equipment;care of grounds;
maintenance and operation of buildings and other plant facilities; security;earthquake and disaster
preparedness;environmental safety; hazardous waste disposal;property, liability and other insurance
relating to property; space and capital leasing; facility planning and management; and,central receiving.
The operation and maintenance expenses category shall also include its allocable share of fringe benefit
costs,depreciation and use allowances, and interest costs.
(4)General administration and general expenses. The expenses under this heading are those that have been
incurred for the overall general executive and administrative offices of the organization and other expenses
of a general nature which do not relate solely to any major function of the organization. This category shall
also include its allocable share of fringe benefit costs,operation and maintenance expense,depreciation
and use allowances, and interest costs. Examples of this category include central offices,such as the
director's office, the office of finance, business services,budget and planning,personnel, safety and risk
management, general counsel,management information systems, and library costs.
In developing this cost pool, special care should be exercised to ensure that costs incurred for the same
purpose in like circumstances are treated consistently as either direct or indirect costs. For example,
salaries of technical staff, project supplies,project publication,telephone toll charges,computer costs,
travel costs, and specialized services costs shall be treated as direct costs wherever identifiable to a
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particular program. The salaries and wages of administrative and pooled clerical staff should normally be
treated as indirect costs. Direct charging of these costs may be appropriate where a major project or activity
explicitly requires and budgets for administrative or clerical services and other individuals involved can be
identified with the program or activity. Items such as office supplies,postage, local telephone costs,
periodicals and memberships should normally be treated as indirect costs.
c. Allocation bases. Actual conditions shall be taken into account in selecting the base to be used in
allocating the expenses in each grouping to benefitting functions. The essential consideration in selecting a
method or a base is that it is the one best suited for assigning the pool of costs to cost objectives in
accordance with benefits derived; a traceable cause and effect relationship; or logic and reason,where
neither the cause nor the effect of the relationship is determinable. When an allocation can be made by
assignment of a cost grouping directly to the function benefited, the allocation shall be made in that
manner. When the expenses in a cost grouping are more general in nature, the allocation shall be made
through the use of a selected base which produces results that are equitable to both the Federal Government
and the organization. The distribution shall be made in accordance with the bases described herein unless it
can be demonstrated that the use of a different base would result in a more equitable allocation of the costs,
or that a more readily available base would not increase the costs charged to sponsored awards. The results
of special cost studies(such as an engineering utility study)shall not be used to determine and allocate the
indirect costs to sponsored awards.
(1)Depreciation and use allowances.Depreciation and use allowances expenses shall be allocated in the
following manner:
(a)Depreciation or use allowances on buildings used exclusively in the conduct of a single function,and on
capital improvements and equipment used in such buildings,shall be assigned to that function.
(b)Depreciation or use allowances on buildings used for more than one function, and on capital
improvements and equipment used in such buildings, shall be allocated to the individual functions
performed in each building on the basis of usable square feet of space, excluding common areas, such as
hallways,stairwells,and restrooms.
(c)Depreciation or use allowances on buildings,capital improvements and equipment related space(e.g.,
individual rooms,and laboratories)used jointly by more than one function(as determined by the users of
the space)shall be treated as follows. The cost of each jointly used unit of space shall be allocated to the
benefitting functions on the basis of:
(i)the employees and other users on a full-time equivalent(FTE)basis or salaries and wages of those
individual functions benefitting from the use of that space; or
(ii)organization-wide employee FTEs or salaries and wages applicable to the benefitting functions of the
organization.
(d)Depreciation or use allowances on certain capital improvements to land,such as paved parking areas,
fences,sidewalks,and the like,not included in the cost of buildings,shall be allocated to user categories on
a FTE basis and distributed to major functions in proportion to the salaries and wages of all employees
applicable to the functions.
(2)Interest. Interest costs shall be allocated in the same manner as the depreciation or use allowances on
the buildings,equipment and capital equipments to which the interest relates.
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(3)Operation and maintenance expenses. Operation arid maintenance expenses shall be allocated in the
same manner as the depreciation and use allowances.
(4)General administration and general expenses. General administration and general expenses shall be
allocated to benefitting functions based on modified total direct costs(MTDC), as described in
subparagraph D.3.f. The expenses included in this category could be grouped first according to major
functions of the organization to which they render services or provide benefits. The aggregate expenses of
each group shall then be allocated to benefitting functions based on MTDC.
d. Order of distributions
(1)Indirect cost categories consisting of depreciation and use allowances, interest,operation and
maintenance, and general administration and general expenses shall be allocated in that order to the
remaining indirect cost categories as well as to the major functions of the organization. Other cost
categories could be allocated in the order determined to be most appropriate by the organization. When
cross allocation of costs is made as provided in subparagraph(2), this order of allocation does not apply.
(2)Normally, an indirect cost category will be considered closed once it has been allocated to other cost
objectives, and costs shall not be subsequently allocated to it. However, a cross allocation of costs between
two or more indirect costs categories could be used if such allocation will result in a more equitable
allocation of costs. If a cross allocation is used, an appropriate modification to the composition of the
indirect cost categories is required.
e. Application of indirect cost rate or rates. Except where a special indirect cost rate(s)is required in
accordance with subparagraph D.5, the separate groupings of indirect costs allocated to each major
function shall be aggregated and treated as a common pool for that function. The costs in the common pool
shall then be distributed to individual awards included in that function by use of a single indirect cost rate.
f. Distribution basis. Indirect costs shall be distributed to applicable sponsored awards and other benefitting
activities within each major function on the basis of MTDC. MTDC consists of all salaries and wages,
fringe benefits,materials and supplies, services,travel, and subgrants and subcontracts up to the first
$25,000 of each subgrant or subcontract(regardless of the period covered by the subgrant or subcontract).
Equipment,capital expenditures,charges for patient care,rental costs and the portion in excess of$25,000
shall be excluded from MTDC. Participant support costs shall generally be excluded from MTDC. Other
items may only be excluded when the Federal cost cognizant agency determines that an exclusion is
necessary to avoid a serious inequity in the distribution of indirect costs.
g. Individual Rate Components. An indirect cost rate shall be determined for each separate indirect'cost
pool developed. The rate in each case shall be stated as the percentage which the amount of the particular
indirect cost pool is of the distribution base identified with that pool. Each indirect cost rate negotiation or
determination agreement shall include development of the rate for each indirect cost pool as well as the
overall indirect cost rate. The indirect cost pools shall be classified within two broad categories: "Facilities"
and "Administration," as described in subparagraph C.3.
4. Direct allocation method.
a. Some non-profit organizations treat all costs as direct costs except general administration and general
expenses. These organizations generally separate their costs into three basic categories: (i)General
administration and general expenses, (ii) fundraising, and(iii)other direct functions(including projects
performed under Federal awards). Joint costs, such as depreciation, rental costs,operation and maintenance
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of facilities,telephone expenses, and the like are prorated individually as direct costs to each category and
to each award or other activity using a base most appropriate to the particular cost being prorated.
b.This method is acceptable,provided each joint cost is prorated using a base which accurately measures
the benefits provided to each award or other activity. The bases must be established in accordance with
reasonable criteria, and be supported by current data. This method is compatible with the Standards of
Accounting and Financial Reporting for Voluntary Health and Welfare Organizations issued jointly by the
National Health Council, Inc.,the National Assembly of Voluntary Health and Social Welfare
Organizations,and the United Way of America.
c. Under this method,indirect costs consist exclusively of general administration and general expenses. In
all other respects, the organization's indirect cost rates shall be computed in the same manner as that
described in subparagraph 2.
5. Special indirect cost rates. In some instances,a single indirect cost rate for all activities of an
organization or for each major function of the organization may not be appropriate, since it would not take
into account those different factors which may substantially affect the indirect costs applicable to a
particular segment of work. For this purpose,a particular segment of work may be that performed under a
single award or it may consist of work under a group of awards performed in a common environment.
These factors may include the physical location of the work,the level of administrative support required,
the nature of the facilities or other resources employed,the scientific disciplines or technical skills
involved,the organizational arrangements used,or any combination thereof. When a particular segment of
work is performed in an environment which appears to generate a significantly different level of indirect
costs,provisions should be made for a separate indirect cost pool applicable to such work. The separate
indirect cost pool should be developed during the course of the regular allocation process, and the separate
indirect cost rate resulting therefrom should be used,provided it is determined that(i)the rate differs
significantly from that which would have been obtained under subparagraphs 2,3,and 4,and(ii)the
volume of work to which the rate would apply is material.
E. Negotiation and Approval of Indirect Cost Rates
1. Definitions. As used in this section,the following terms have the meanings set forth below:
a. Cognizant agency means the Federal agency responsible for negotiating and approving indirect cost
rates for a non-profit organization on behalf of all Federal agencies.
b. Predetermined rate means an indirect cost rate,applicable to a specified current or future period,
usually the organization's fiscal year. The rate is based on an estimate of the costs to be incurred during the
period. A predetermined rate is not subject to adjustment.
c. Fixed rate means an indirect cost rate which has the same characteristics as a predetermined rate,except
that the difference between the estimated costs and the actual costs of the period covered by the rate is
carried forward as an adjustment to the rate computation of a subsequent period.
d. Final rate means an indirect cost rate applicable to a specified past period which is based on the actual
costs of the period. A final rate is not subject to adjustment.
e. Provisional rate or billing rate means a temporary indirect cost rate applicable to a specified period
which is used for funding, interim reimbursement,and reporting indirect costs on awards pending the
establishment of a final rate for the period.
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f. Indirect cost proposal means the documentation prepared by an organization to substantiate its claim
for the reimbursement of indirect costs. This proposal provides the basis for the review and negotiation
leading to the establishment of an organization's indirect cost rate.
g. Cost objective means a function,organizational subdivision,contract, grant, or other work unit for
which cost data are desired and for which provision is made to accumulate and measure the cost of
processes,projects,jobs and capitalized projects.
2. Negotiation and approval of rates.
a. Unless different arrangements are agreed to by the agencies concerned, the Federal agency with the
largest dollar value of awards with an organization will be designated as the cognizant agency 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 non-profit
organization, the assignment will not be changed unless there is a major long-term shift in the dollar
volume of the Federal awards to the organization. All concerned Federal agencies shall 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 awards necessitate special indirect cost rates in accordance with subparagraph D.5, it
will,prior to the time the rates are negotiated, notify the cognizant,agency.
b. A non-profit organization which has not previously established an indirect cost rate with a Federal
agency shall submit its initial indirect cost proposal immediately after the organization is advised that an
award will be made and, in no event, later than three months after the effective date of the award.
c. Organizations that have previously established indirect cost rates must submit a new indirect cost
proposal to the cognizant agency within six months after the close of each fiscal year.
d. A predetermined rate may be negotiated for use on awards where there is reasonable assurance,based on
past experience and reliable projection of the organization's costs,that the rate is not likely to exceed a rate
based on the organization's actual costs.
e. Fixed rates may be negotiated where predetermined rates are not considered appropriate. A fixed rate,
however, shall not be negotiated if(i) all or a substantial portion of the organization's awards are expected
to expire before the carry-forward adjustment can be made;{ii)the mix of Federal and non-Federal work at
the organization is too erratic to permit an equitable carry-forward adjustment; or(iii)the organization's
operations fluctuate significantly from year to year.
f. Provisional and final rates shall be negotiated where neither predetermined nor fixed rates are
appropriate.
g. The results of each negotiation shall be formalized in a written agreement between the cognizant agency
and the non-profit organization. The cognizant agency shall distribute copies of the agreement to all
concerned Federal agencies.
h. If a dispute arises in a negotiation of an indirect cost rate between the cognizant agency and the
non-profit organization,the dispute shall be resolved in accordance with the appeals procedures of the
cognizant agency.
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i.To the extent that problems are encountered among the Federal agencies in connection with the
negotiation and approval process,OMB will lend assistance as required to resolve such problems in a
timely manner.
ATTACHMENT B
Circular No. A-122
SELECTED ITEMS OF COST
Table of Contents
1. Advertising and public relations costs
2. Alcoholic beverages
3. Bad debts
4.Bid and proposal costs(reserved)
5. Bonding costs
6. Communication costs
7. Compensation for personal services
8. Contingency provisions
9. Contributions
10. Defense and prosecution of criminal and civil proceedings,claims, appeals and patent infringement
11. Depreciation and use allowances
12. Donations
13. Employee morale,health, and welfare costs and credits
14. Entertainment costs
15. Equipment and other capital expenditures
16. Fines and penalties
17. Fringe benefits
18. Goods or services for personal use
19. Housing and personal living expenses
20. Idle facilities and idle capacity
21. Independent research and development(reserved)
22. Insurance and indemnification
23. Interest, fund raising,and investment management costs
24. Labor relations costs
25. Lobbying
26. Losses on other awards
27. Maintenance and repair costs
28.Materials and supplies
29. Meetings and conferences
30. Memberships, subscriptions, and professional activity costs
31. Organization costs
32. Overtime, extra-pay shift,and multi-shift premiums
33. Page charges in professional journals
34. Participant support costs
35. Patent costs
36. Pension plans
37. Plant security costs
38. Pre-award costs
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39. Professional service costs
40. Profits and losses on disposition of depreciable property or other capital assets
41. Publication and printing costs
42. Rearrangement and alteration costs
43. Reconversion costs
44. Recruiting costs
45. Relocation costs
46. Rental costs
47. Royalties and other costs for use of patents and copyrights
48. Selling and marketing
49. Severance pay
50. Specialized service facilities
51. Taxes
52. Termination costs
53. Training and education costs
54. Transportation costs
55. Travel costs
56. Trustees
ATTACHMENT B
Circular No. A-122
SELECTED ITEMS OF COST
Paragraphs 1 through 56 provide principles to be applied in establishing the allowability of certain items
of cost. These principles apply whether a cost is treated as direct or indirect. Failure to mention a particular
item of cost is not intended to imply that it is unallowable; rather,determination as to allowability in each
case should be based on the treatment or principles provided for similar or related items of cost.
1. Advertising and public relations costs.
a. The term advertising costs means the costs of advertising media and corollary administrative costs.
Advertising media include magazines, newspapers, radio and television programs,direct mail,exhibits,
and the like.
b. The term public relations includes community relations and means those activities dedicated to
maintaining the image of the organization or maintaining or promoting understanding and favorable
relations with the community or public at large or any segment of the public. •
c. The only allowable advertising costs are those which are solely for:
(1) The recruitment of personnel required for the performance by the organization of obligations arising
under a sponsored award, when considered in conjunction with all other recruitment costs, as set forth in
paragraph 44("Recruiting costs");
(2)The procurement of goods and services for the performance of a sponsored award;
(3)The disposal of scrap or surplus materials acquired in the performance of a sponsored award except
when organizations are reimbursed for disposal costs at a predetermined amount in accordance with OMB
Circular A-110, Sec. .34, "Equipment";or
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(4)Other specific purposes necessary to meet the requirements of the sponsored award.
d. The only allowable public relations costs are:
(1)Costs specifically required by sponsored awards;
(2)Costs of communicating with the public and press pertaining to specific activities or accomplishments
which result from performance of sponsored awards(these costs are considered necessary as part of the
outreach effort for the sponsored awards);or
(3)Costs of conducting general liaison with news media and government public relations officers,to the
extent that such activities are limited to communication and liaison necessary to keep the public informed
on matters of public concern, such as notices of contract/grant awards, financial matters, etc.
e. Costs identified in subparagraphs c and d if incurred for more than one sponsored award or for both
sponsored work and other work of the organization,are allowable to the extent that the principles in
paragraphs B("Direct Costs")and C("Indirect Costs")of Attachment A are observed.
f.Unallowable advertising and public relations costs include the following:
(1)All advertising and public relations costs other than as specified in subparagraphs c,d,and e;
(2)Costs of meetings or other events related to fund raising or other organizational activities including:
(i)Costs of displays,demonstrations,and exhibits;
(ii)Costs of meeting rooms,hospitality suites, and other special facilities used in conjunction with shows
and other special events; and
(iii)Salaries and wages of employees or cost of services engaged in setting up and displaying exhibits,
making demonstrations, and providing briefings;
(3)Costs of promotional items and memorabilia, including models,gifts, and souvenirs;
(4)Costs of advertising and public relations designed solely to promote the organization.
2. Alcoholic beverages. Costs of alcoholic beverages are unallowable.
3. Bad debts. Bad debts, including losses(whether actual or estimated)arising from uncol
lectible accounts
and other claims,related collection costs,and related legal costs,are unallowable.
4. Bid and proposal costs. (reserved)
5. Bonding costs.
a. Bonding costs arise when the Federal Government requires assurance against financial loss to itself or
others by reason of the act or default of the organization. They arise also in instances where the
organization requires similar assurance. Included are such bonds as bid,performance,payment,advance
payment, infringement, and fidelity bonds.
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b. Costs of bonding required pursuant to the terms of the award are allowable.
c. Costs of bonding required by the organization in the general conduct of its operations are allowable to
the extent that such bonding is in accordance with sound business practice and the rates and premiums are
reasonable under the circumstances.
6. Communication costs. Costs incurred for telephone services, local and long distance telephone calls,
telegrams,radiograms,postage and the like are allowable.
7. Compensation for personal services.
a. Definition. Compensation for personal services includes all compensation paid currently or accrued by
the organization for services of employees rendered during the period of the award(except as otherwise
provided in subparagraph h). It includes,but is not limited to,salaries,wages,director's and executive
committee member's fees, incentive awards, fringe benefits,pension plan costs, allowances for off-site pay,
incentive pay, location allowances, hardship pay, and cost of living differentials.
b. Aloowability. Except as otherwise specifically provided in this paragraph, the costs of such
compensation are allowable to the extent that:
(1)Total compensation to individual employees is reasonable for the services rendered and conforms to the
established policy of the organization consistently applied to both federal and non-Federal activities;and
(2)Charges to awards whether treated as direct or indirect costs are determined and supported as required
in this paragraph.
c. Reasonableness.
(1) When the organization is predominantly engaged in activities other than those sponsored by the Federal
Government, compensation for employees on federally-sponsored work will be considered reasonable to
the extent that it is consistent with that paid for similar work in the organization's other activities.
(2)When the organization is predominantly engaged in federally-sponsored activities and in cases where
the kind of employees required for the Federal activities are not found in the organization's other activities,
compensation for employees on federally-sponsored work will be considered reasonable to the extent that it
is comparable to that paid for similar work in the labor markets in which the organization competes for the
kind of employees involved. •
d. Special considerations in determining allowability. Certain conditions require special consideration
and possible limitations in determining costs under Federal awards where amounts or types of
compensation appear unreasonable. Among such conditions are the following:
(1) Compensation to members of non-profit organizations,trustees,directors, associates,officers,or the
immediate families thereof. Determination should be made that such compensation is reasonable for the
actual personal services rendered rather than a distribution of earnings in excess of costs.
(2)Any change in an organization's compensation policy resulting in a substantial increase in the
organization's level of compensation, particularly when it was concurrent with an increase in the ratio of
Federal awards to other activities of the organization or any change in the treatment of allowability of
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specific types of compensation due to changes in Federal policy.
e. Unallowable costs. Costs which are unallowable under other paragraphs of this Attachment shall not be
allowable under this paragraph solely on the basis that they constitute personal compensation.
f. Fringe benefits.
(1)Fringe benefits in the form of regular compensation paid to employees during periods of authorized
absences from the job,such as vacation leave, sick leave,military leave, and the like,are allowable,
provided such costs are absorbed by all organization activities in proportion to the relative amount of time
or effort actually devoted to each.
(2)Fringe benefits in the form of employer contributions or expenses for social security,employee
insurance,workmen's compensation insurance,pension plan costs(see subparagraph h), and the like, are
allowable,provided such benefits are granted in accordance with established written organization policies.
Such benefits whether treated as indirect costs or as direct costs, shall be distributed to particular awards
and other activities in a manner consistent with the pattern of benefits accruing to the individuals or group
of employees whose salaries and wages are chargeable to such awards and other activities.
3 (a)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
shall not exceed the present value of the liability.
(b)Where an organization follows a consistent policy of expensing actual payments to,or on behalf of,
employees or former employees for unemployment compensation or workers'compensation, such
payments are allowable in the year of payment with the prior approval of the awarding agency,provided
they are allocated to all activities of the organization.
(4)Costs of insurance on the lives of trustees,officers, or other employees holding positions of similar
the represents additional compensation. The
responsibility are allowable onlyto the extent that insurancep P
P Y
costs of such insurance when the organization is named as beneficiary are unallowable.
g. Organization-furnished automobiles. That portion of the cost of organization-furnished automobiles
that relates to personal use by employees(including transportation to and from work)is unallowable as
fringe benefit or indirect costs regardless of whether the cost is reported as taxable income to the
employees. These costs are allowable as direct costs to sponsored award when necessary for the
performance of the sponsored award and approved by awarding agencies.
h. Pension plan costs.
(1)Costs of the organization's pension plan which are incurred in accordance with the established policies
of the organization are allowable,provided:
(a)Such policies meet the test of reasonableness;
(b)The methods of cost allocation are not discriminatory;
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(c)The cost assigned to each fiscal year is determined in accordance with generally accepted accounting
principles(GAAP), as prescribed in Accounting Principles Board Opinion No. 8 issued by the American
Institute of Certified Public Accountants; and
(d)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 days after each quarter.of the year to which such costs are assignable are
unallowable.
(2)Pension plan termination insurance premiums paid pursuant to the Employee Retirement Income
Security Act(ERISA)of 1974(Pub. L. 93-406)are allowable. Late payment charges on such premiums are
unallowable.
(3)Excise taxes on accumulated funding deficiencies and other penalties imposed under ERISA are
unallowable.
i. Incentive compensation. Incentive compensation to employees based on cost reduction,or efficient
performance, suggestion awards, safety awards,etc., are allowable to the extent that the overall
compensation is determined to be reasonable and such costs are paid or accrued pursuant to an agreement
entered into in good faith between the organization and the employees before the services were rendered, or
pursuant to an established plan followed by the organization so consistently as to imply, in effect, an
agreement to make such payment.
j. Overtime,extra-pay shift,and multi-shift premiums. See paragraph 32.
k. Severance pay. See paragraph 49.
1. Training and education costs. See paragraph 53.
m. Support of salaries and wages.
(1) Charges to awards for salaries and wages, whether treated as direct costs or indirect costs,will be based
on documented payrolls approved by a responsible official(s)of the organization. The distribution of
salaries and wages to awards must be supported by personnel activity reports,as prescribed in
subparagraph (2), except when a substitute system has been approved in writing by the cognizant agency.
(See subparagraph E.2 of Attachment A.)
(2) Reports reflecting the distribution of activity of each employee must be maintained for all staff
members(professionals and nonprofessionals)whose compensation is charged, in whole or in part,directly
to awards. In addition, in order to support the allocation of indirect costs,such reports must also be
maintained for other employees whose work involves two or more functions or activities if a distribution of
their compensation between such functions or activities is needed in the determination of the organization's
indirect cost rate(s)(e.g., an employee engaged part-time in indirect cost activities and part-time in a direct
function). Reports maintained by non-profit organizations to satisfy these requirements must meet the
following standards:
(a) The reports must reflect an after-the-Pict determination of the actual activity of each employee. Budget
estimates(i.e., estimates determined before the services are performed)do not qualify as support for
charges to awards.
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4.
(b)Each report must account for the total activity for which employees are compensated and which is
required in fulfillment of their obligations to the organization.
(c)The reports must be signed by the individual employee,or by a responsible supervisory official having
first hand knowledge of the activities performed by the employee, that the distribution of activity represents
a reasonable estimate of the actual work performed by the employee during the periods covered by the
reports.
(d)The reports must be prepared at least monthly and must coincide with one or more pay periods.
(3)Charges for the salaries and wages of nonprofessional employees, in addition to the supporting
documentation described in subparagraphs(1)and(2),must also be supported by records indicating the
total number of hours worked each day maintained in conformance with Department of Labor regulations
implementing the Fair Labor Standards Act(FLSA)(29 CFR Part 516). For this purpose,the term
"nonprofessional employee" shall have the same meaning as "nonexempt employee," under FLSA.
(4) Salaries and wages of employees used in meeting cost sharing or matching requirements on awards
must be supported in the same manner as salaries and wages claimed for reimbursement from awarding
agencies.
8. Contingency provisions. Contributions to a contingency reserve or any similar provision made for
events the occurrence of which cannot be foretold with certainty as to time,intensity,or with an assurance
of their happening,are unallowable. The term"contingency reserve"excludes self-insurance reserves(see
subparagraphs 7.f(3)and 22.a(2)(d);pension funds(see subparagraph 7.h); and reserves for normal
severance pay(see subparagraph 49.b(1)).
9. Contributions. Contributions and donations by the organization to others are unallowable.
10. Defense and prosecution of criminal and civil proceedings,claims,appeals and patent
infringement.
a. De
finitions.
(1)Conviction, as used herein,means a judgment or a conviction of a criminal offense by any court of
competent jurisdiction,whether entered upon as a verdict or a plea, including a conviction due to a plea of
nolo contendere.
(2)Costs include,but are not limited to, administrative and clerical expenses; the cost of legal services,
whether performed by in-house or private counsel; and the costs of the services of accountants,consultants,
or others retained by the organization to assist it;costs of employees,officers and trustees,and any similar
costs incurred before,during,and after commencement of a judicial or administrative proceeding that bears
a direct relationship to the proceedings.
(3)Fraud, as used herein,means(i)acts of fraud corruption or attempts to defraud the Federal Government
or to corrupt its agents, (ii)acts that constitute a cause for debarment or suspension(as specified in agency
regulations), and(iii)acts which violate the False Claims Act, 31 U.S.C., sections 3729-3731,or the
Anti-Kickback Act,41 U.S.C.,sections 51 and 54.
(4)Penalty does not include restitution,reimbursement,or compensatory damages.
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(5)Proceeding includes an investigation.
b. (1) Except as otherwise described herein,costs incurred in connection with any criminal, civil or
administrative proceeding(including filing of a false certification)commenced by the Federal Government,
or a State, local or foreign government, are not allowable if the proceeding: (1)relates to a violation of,or
failure to comply with, a Federal, State, local or foreign statute or regulation by the organization(including
its agents and employees), and(2)results in any of the following dispositions:
(a)In a criminal proceeding,a conviction.
(b)In a civil or administrative proceeding involving an allegation of fraud or similar misconduct, a
determination of organizational liability.
(c)In the case of any civil or administrative proceeding, the imposition of a monetary penalty.
(d)A final decision by an appropriate Federal official to debar or suspend the organization,to rescind or
void an award,or to terminate an award for default by reason of a violation or failure to comply with a law
or regulation.
(e)A disposition by consent or compromise, if the action could have resulted in any of the dispositions
described in(a),(b), (c)or(d).
(2)If more than one proceeding involves the same alleged misconduct,the costs of all such proceedings
shall be unallowable if any one of them results in one of the dispositions shown in subparagraph b.(1).
c. If a proceeding referred to in subparagraph b is commenced by the Federal Government and is resolved
by consent or compromise pursuant to an agreement entered into by the organization and the Federal
Government, then the costs incurred by the organization in connection with such proceedings that are
otherwise not allowable under subparagraph b may be allowed to the extent specifically provided in such
agreement.
d. If a proceeding referred to in subparagraph b is commenced by a State, local or foreign government,
the authorized Federal official may allow the costs incurred by the organization for such proceedings, if
such authorized official determines that the costs were incurred as a result of(1)a specific term or
condition of a federally-sponsored award,or(2)specific written direction of an authorized official of the
sponsoring agency.
e. Costs incurred in connection with proceedings described in subparagraph b, but which are not made
unallowable by that subparagraph,may be allowed by the Federal Government,but only to the extent that:
(1) The costs are reasonable in relation to the activities required to deal with the proceeding and the
underlying cause of action;
•
(2)Payment of the costs incurred, as allowable and allocable costs, is not prohibited by any other
provision(s)of the sponsored award;
(3)The costs are not otherwise recovered from the Federal Government or a third party, either directly as a
result of the proceeding or otherwise; and,
(4)The percentage of costs allowed does not exceed the percentage determined by an authorized Federal
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official to be appropriate,considering the complexity of the litigation, generally accepted principles
governing the award of legal fees in civil actions involving the United States as a party, and such other
factors as may be appropriate. Such percentage shall not exceed 80 percent. However, if an agreement
reached under subparagraph c has explicitly considered this 80 percent limitation and permitted a higher
percentage,then the full amount of costs resulting from that agreement shall be allowable.
f. Costs incurred by the organization in connection with the defense of suits brought by its employees or
ex-employees under section 2 of the Major Fraud Act of 1988 (Pub. L. 100-700), including the cost of all
relief necessary to make such employee whole,where the organization was found liable or settled,are
unallowable.
g. Costs of legal, accounting,and consultant services, and related costs, incurred in connection with
defense against Federal Government claims or appeals, antitrust suits, or the prosecution of claims or
appeals against the Federal Government, are unallowable.
h. Costs of legal,accounting, and consultant services,and related costs,incurred in connection with patent
infringement litigation,are unallowable unless otherwise provided for in the sponsored awards.
i. Costs which may be unallowable under this paragraph,including directly associated costs, shall be
segregated and accounted for by the organization separately. During the pendency of any proceeding
covered by subparagraphs b and f,the Federal Government shall generally withhold payment of such
costs. However,if in the best interests of the Federal Government,the Federal Government may provide
for conditional payment upon provision of adequate security,or other adequate assurance, and agreements
by the organization to repay all unallowable costs,plus interest, if the costs are subsequently determined to
be unallowable.
11. Depreciation and use allowances.
a. Compensation for the use of buildings,other capital improvements,and equipment on hand may be
made through use allowances or depreciation. However,except as provided in subparagraph f,a
combination of the two methods may not be used in connection with a single class of fixed assets(e.g.,
buildings,office equipment,computer equipment, etc.).
b.The computation of use allowances or depreciation shall be based on the acquisition cost of the assets
involved. The acquisition cost of an asset donated to the organization by a third party shall be its fair
market value at the time of the donation.
c. The computation of use allowances or depreciation will exclude:
(1)The cost of land;
(2)Any portion of the cost of buildings and equipment borne by or donated by the Federal Government
irrespective of where title was originally vested or where it presently resides; and
(3)Any portion of the cost of buildings and equipment contributed by or for the organization in satisfaction
of a statutory matching requirement.
d. Where the use allowance method is followed,the use allowance for buildings and improvement
(including land improvements, such as paved parking areas, fences, and sidewalks)will be computed at an
annual rate not exceeding two percent of acquisition cost. The use allowance for equipment will be
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computed at an annual rate not exceeding six and two-thirds percent of acquisition cost. When the use
allowance method is used for buildings,the entire building must be treated as a single asset;the building's
components(e.g.,plumbing system,heating and air conditioning, etc.)cannot be segregated from the
building's shell. The two percent limitation,however,need not be applied to equipment which is merely
attached or fastened to the building but not permanently fixed to it and which is used as furnishings or
decorations or for specialized purposes(e.g.,dentist chairs and dental treatment units, counters, laboratory
benches bolted to the floor,dishwashers,carpeting,etc.). Such equipment will be considered as not being
permanently fixed to the building if it can be removed without the need for costly or extensive alterations
or repairs to the building or the equipment. Equipment that meets these criteria will be subject to the six
and two-thirds percent equipment use allowance limitation.
e. Where depreciation method is followed, the period of useful service(useful life)established in each case
for usable capital assets must take into consideration such factors as type of construction,nature of the
equipment used, technological developments in the particular program area, and the renewal and
replacement policies followed for the individual items or classes of assets involved. The method of
depreciation used to assign the cost of an asset(or group of assets)to accounting periods shall reflect the
pattern of consumption of the asset during its useful life. In the absence of clear evidence indicating that
the expected consumption of the asset will be significantly greater or lesser in the early portions of its
useful life than in the later portions, the straight-line method shall be presumed to be the appropriate
method. Depreciation methods once used shall not be changed unless approved in advance by the cognizant
Federal agency. When the depreciation method is introduced for application to assets previously subject to
a use allowance,the combination of use allowances and depreciation applicable to such assets must not
exceed the total acquisition cost of the assets. When the depreciation method is used for buildings,a
building's shell may be segregated from each building component(e.g.,plumbing system,heating,and air
conditioning system, etc.)and each item depreciated over its estimated useful life; or the entire building
(i.e., the shell and all components)may be treated as a single asset and depreciated over a single useful life.
f. When the depreciation method is used for a particular class of assets,no depreciation may be allowed on
any such assets that, under subparagraph e, would be viewed as fully depreciated. However,a reasonable
use allowance may be negotiated for such assets if warranted after taking into consideration the amount of
depreciation previously charged to the Federal Government,the estimated useful life remaining at time of
negotiation, the effect of any increased maintenance charges or decreased efficiency due to age, and any
other factors pertinent to the utilization of the asset for the purpose contemplated.
g. Charges for use allowances or depreciation must be supported by adequate property records and physical
inventories must be taken at least once every two years(a statistical sampling basis is acceptable)to ensure
that assets exist and are usable and needed. When the depreciation method is followed, adequate
depreciation records indicating the amount of depreciation taken each period must also be maintained.
12. Donations.
a. Services received.
(1)Donated or volunteer services may be furnished to an organization by professional and technical
personnel,consultants, and other skilled and unskilled labor. The value of these services is not
reimbursable either as a direct or indirect cost.
(2)The value of donated services utilized in the performance of a direct cost activity shall be considered in
the determination of the organization's indirect cost rate(s)and, accordingly,shall be allocated a
proportionate share of applicable indirect costs when the following circumstances exist:
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(a)The aggregate value of the services is material;
(b)The services are supported by a significant amount of the indirect costs incurred by the organization;
(c)The direct cost activity is not pursued primarily for the benefit of the Federal Government,
(3)In those instances where there is no basis for determining the fair market value of the services rendered,
the recipient and the cognizant agency shall negotiate an appropriate allocation of indirect cost to the
services.
(4)Where donated services directly benefit a project supported by an award,the indirect costs allocated to
the services will be considered as a part of the total costs of the project. Such indirect costs may be
reimbursed under the award or used to meet cost sharing or matching requirements.
(5)The value of the donated services may be used to meet cost sharing or matching requirements under
conditions described in Sec._.23 of Circular A-110. Where donated services are treated as indirect costs,
indirect cost rates will separate the value of the donations so that reimbursement will not be made.
(6)Fair market value of donated services shall be computed as follows:
(a)Rates for volunteer services. Rates for volunteers shall be consistent with those regular rates paid for - -
similar work in other activities of the organization. In cases where the kinds of skills involved are not
found in other activities of the organization,the rates used shall be consistent with those paid for similar
work in the labor market in which the organization competes for such skills.
(b)Services donated by other organizations. When an employer donates the services of an employee,
these services shall be valued at the employee's regular rate of pay(exclusive of fringe benefits and indirect
costs),provided the services are in the same skill for which the employee is normally paid. If the services
are not in the same skill for which the employee is normally paid, fair market value shall be computed in
accordance with subparagraph (a).
b. Goods and space.
(1)Donated goods; i.e., expendable personal property/supplies,and donated use of space may be furnished
to an organization. The value of the goods and space is not reimbursable either as a direct or indirect cost.
(2)The value of the donations may be used to meet cost sharing or matching share requirements under the
conditions described in Sec._.23 of Circular A-110. The value of the donations shall be determined in
accordance with Sec._.23 of Circular A-110. Where donations are treated as indirect costs, indirect cost
rates will separate the value of the donations so that reimbursement will not be made.
13. Employee morale,health,and welfare costs and credits. The costs of house publications,health or
first-aid clinics,and/or infirmaries,recreational activities,employees'counseling services,and other
expenses incurred in accordance with the organization's established practice or custom for the improvement
of working conditions, employer-employee relations,employee morale, and employee performance are
allowable. Such costs will be equitably apportioned to all activities of the organization. Income generated
from any of these activities will be credited to the cost thereof unless such income has been irrevocably set
over to employee welfare organizations.
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14. Entertainment costs.Costs of amusement,diversion, social activities,ceremonials,and costs relating
thereto, such as meals, lodging,rentals,transportation,and gratuities are unallowable(but see paragraphs
13 and 30).
15. Equipment and other capital expenditures.
a. As used in this paragraph,the following terms have the meanings set forth below:
(1) "Equipment"means an article of nonexpendable, tangible personal property having a useful life of more
than one year and an acquisition cost which equals or exceeds the lesser of(a)the capitalization level
established by the organization for the financial statement purposes,or(b) $5000. The unamortized portion
of any equipment written off as a result of a change in capitalization levels may be recovered by continuing
to claim the otherwise allowable use allowances or depreciation on the equipment, or by amortizing the
amount to be written off over a period of years as negotiated with the Federal cognizant agency.
(2)Acquisition cost means the net invoice unit price of an item of 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. Ancillary charges, such as taxes,duty,protective in-transit insurance, freight, and
installation shall be included in or excluded from acquisition cost in accordance with the organization's
regular written accounting practices.
(3)Special purpose equipment means equipment which is usable only for research,medical,scientific, or
technical activities. Examples of special purpose equipment include microscopes,x-ray machines, surgical
instruments, and spectrometers.
(4)General purpose equipment means equipment which is usable for other than research,medical,
scientific,or technical activities,whether or not special modifications are needed to make them suitable for
a particular purpose. Examples of general purpose equipment include office equipment and furnishings, air
conditioning equipment, reproduction and printing equipment,motor vehicles,and automatic data
processing equipment.
b. (1)Capital expenditures for general purpose equipment are unallowable as a direct cost except with the
prior approval of the awarding agency.
(2)Capital expenditures for special purpose equipment are allowable as direct costs,provided that items
with a unit cost of$5000 or more have the prior approval of awarding agency.
c. Capital expenditures for land or buildings are unallowable as a direct cost except with the prior approval
of the awarding agency.
d. 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 approval of the awarding agency.
e. Equipment and other capital expenditures are unallowable as indirect costs. However, see paragraph 11
for allowability of use allowances or depreciation on buildings, capital improvements, and equipment.
Also, see paragraph 46 for allowability of rental costs for land,buildings, and equipment.
16. Fines and penalties. Costs of fines and penalties resulting from violations of,or failure of the
organization to comply with Federal, State, and local laws and regulations are unallowable except when
incurred as a result of compliance with specific provisions of an award or instructions in writing from the
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awarding agency.
17. Fringe benefits. See subparagraph 7.f.
18. Goods or services for personal use. Costs of goods or services for personal use of the organization's
employees are unallowable regardless of whether the cost is reported as taxable income to the employees.
19. Housing and personal living expenses.
a. Costs of housing(e.g.,depreciation,maintenance,utilities, furnishings,rent,etc.), housing allowances
and personal living expenses for/of the organization's officers are unallowable as fringe benefit or indirect
costs regardless of whether the cost is reported as taxable income to the employees. These costs are
allowable as direct costs to sponsored award when necessary for the performance of the sponsored award
and approved by awarding agencies.
b. The term"officers" includes current and past officers and employees.
20. Idle facilities and idle capacity.
a. As used in this paragraph,the following terms have the meanings set forth below:
(1) Facilities means land and buildings or any portion thereof,equipment individually or collectively,or any other tangible capital asset,wherever located, and whether owned or leased by the organization.
(2)Idle facilities means completely unused facilities that are excess to the organization's current needs.
(3) Idle capacity means the unused capacity of partially used facilities. It is the difference between that
which a facility could achieve under 100 percent operating time on a one-shift basis less operating
interruptions resulting from time lost for repairs, setups, unsatisfactory materials,and other normal delays,
and the extent to which the facility was actually used to meet demands during the accounting period. A
multi-shift basis may be used if it can be shown that this amount of usage could normally be expected for
the type of facility involved.
(4)Costs of idle facilities or idle capacity means costs such as maintenance, repair,housing,rent, and
other related costs, e.g.,property taxes, insurance,and depreciation or use allowances.
b. The costs of idle facilities are unallowable except to the extent that:
(1)They are necessary to meet fluctuations in workload; or
(2)Although not necessary to meet fluctuations in workload,they were necessary when acquired and are
now idle because of changes in program requirements,efforts to achieve more economical operations,
reorganization,termination,or other causes which could not have been reasonably foreseen. Under the
exception stated in this subparagraph,costs of idle facilities are allowable for a reasonable period of time,
ordinarily not to exceed one year,depending upon the initiative taken to use, lease,or dispose of such
facilities(but see subparagraphs 48.b and d).
c. The costs of idle capacity are normal costs of doing business and are a factor in the normal fluctuations
of usage or indirect cost rates from period to period. Such costs are allowable,provided the capacity is
reasonably anticipated to be necessary or was originally reasonable and is not subject to reduction or
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elimination by subletting, renting, or sale, in accordance with sound business,economics, or security
practices. Widespread idle capacity throughout an entire facility or among a group of assets having
substantially the same function may be idle facilities.
21. Independent research and development. [Reserved]
22. Insurance and indemnification.
a. Insurance includes insurance which the organization is required to carry,or which is approved,under the
terms of the award and any other insurance which the organization maintains in connection with the
general conduct of its operations. This paragraph does not apply to insurance which represents fringe
benefits for employees(see subparagraphs 7.f and 7.h(2)).
(1) Costs of insurance required or approved, and maintained,pursuant to the award are allowable.
(2)Costs of other insurance maintained by the organization in connection with the general conduct of its
operations are allowable subject to the following limitations:
(a)Types and extent of coverage shall be in accordance with sound business practice and the rates and
premiums shall be reasonable under the circumstances.
(b)Costs allowed for business interruption or other similar insurance shall be limited to exclude coverage
of management fees.
(c) Costs of insurance or of any provisions for a reserve covering the risk of loss or damage to Federal
property are allowable only to the extent that the organization is liable for such loss or damage.
(d)Provisions for a reserve under a self-insurance program are allowable to the extent that types of
coverage,extent of coverage, rates, and premiums would have been allowed had insurance been purchased
to cover the risks. However,provision for known or reasonably estimated self-insured liabilities,which do
not become payable for more than one year after the provision is made, shall not exceed the present value
of the liability.
(e) Costs of insurance on the lives of trustees,officers,or other employees holding positions of similar
responsibilities are allowable only to the extent that the insurance represents additional compensation(see
subparagraph 71(4)). The cost of such insurance when the organization is identified as the beneficiary is
unallowable.
1
(f) Insurance against defects. Costs of insurance with respect to any costs incurred to correct defects in the
organization's materials or workmanship are unallowable.
(g)Medical liability(malpractice)insurance. Medical liability insuranctw is an allowable cost of Federal
research programs only to the extent that the Federal research programs involve human subjects or training
of participants in research techniques. Medical liability insurance costs shall be treated as a direct cost and
shall be assigned to individual projects based on the manner in which the insurer allocates the risk to the
population covered by the insurance.
(3)Actual losses which could have been covered by permissible insurance(through the purchase of
insurance or a self-insurance program) are unallowable unless expressly provided for in the award,except:
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(a)Costs incurred because of losses not covered under nominal deductible insurance coverage provided in
keeping with sound business practice are allowable.
(b)Minor losses not covered by insurance,such as spoilage,breakage, and disappearance of supplies,
which occur in the ordinary course of operations,are allowable.
b. Indemnification includes securing the organization against liabilities to third persons and any other loss
or damage,not compensated by insurance or otherwise. The Federal Government is obligated to indemnify
the organization only to the extent expressly provided in the award.
23. Interest,fundraising, and investment management costs.
a. Interest.
(1)Costs incurred for interest on borrowed capital or temporary use of endowment funds,however
represented, are unallowable. However, interest on debt incurred after the effective date of this revision to
acquire or replace capital assets(including renovations, alterations, equipment, land, and capital assets
acquired through capital leases), acquired after the effective date of this revision and used in support of
sponsored agreements is allowable,provided that:
(a)For facilities acquisitions(excluding renovations and alterations)costing over$10 million where the
Federal Government's reimbursement is expected to equal or exceed 40 percent of an asset's cost,the
non-profit organization prepares,prior to the acquisition or replacement of the capital asset(s), a
justification that demonstrates the need for the facility in the conduct of federally-sponsored activities.
Upon request,the needs justification must be provided to the Federal agency with cost cognizance
authority as a prerequisite to the continued allowability of interest on debt and depreciation related to the
facility. The needs justification for the acquisition of a facility should include,at a minimum,the
following:
A statement of purpose and justification for facility acquisition or replacement
A statement as to why current facilities are not adequate
A statement of planned future use of the facility
A description of the financing agreement to be arranged for the facility
A summary of the building contract with estimated cost information and statement of source and use of
funds
A schedule of planned occupancy dates
(b)For facilities costing over$500,000,the non-profit organization prepares,prior to the acquisition or
replacement of the facility, a lease/purchase analysis in accordance with the provisions of Sec._.30
through_.37 of Circular A-110,which shows that a financed purchase or capital lease is less costly to the
organization than other leasing alternatives,on a net present value basis. Discount rates used should be
equal to the non-profit organization's anticipated interest rates and should be no higher than the fair market
rate available to the non-profit organization from an unrelated("arm's length")third-party. The
lease/purchase analysis shall include a comparison of the net present value of the projected total cost
comparisons of both alternatives over the period the asset is expected to be used by the non-profit
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organization. The cost comparisons associated with purchasing the facility shall include the estimated
purchase price,anticipated operating and maintenance costs(including property taxes, if applicable)not
included in the debt financing, less any estimated asset salvage value at the end of the period defined
above. The cost comparison for a capital lease shall include the estimated total lease payments, any
estimated bargain purchase option,operating and maintenance costs, and taxes not included in the capital
leasing arrangement, less any estimated credits due under the lease at the end of the period defined above.
Projected operating lease costs shall be based on the anticipated cost of leasing comparable facilities at fair
market rates under rental agreements that would be.renewed or reestablished over the period defined above,
and any expected maintenance costs and allowable property taxes to be borne by the non-profit
organization directly or as part of the lease arrangement.
(c)The actual interest cost claimed is predicated upon interest rates that are no higher than the fair market
rate available to the non-profit organization from an unrelated ("arm's length")third party.
(d) Investment earnings, including interest income,on bond or loan principal,pending payment of the
construction or acquisition costs, are used to offset allowable interest cost. Arbitrage earnings reportable to
the Internal Revenue Service are not required to be offset against allowable interest costs.
(e)Reimbursements are limited to the least costly alternative based on the total cost analysis required under
subparagraph (b). For example, if an operating lease is determined to be less costly than purchasing
through debt financing, then reimbursement is limited to the amount determined if leasing had been used.
In all cases where a lease/purchase analysis is performed, Federal reimbursement shall be based upon the
least expensive alternative.
(f)Non-profit organizations are also subject to the following conditions:
(i)Interest on debt incurred to finance or refinance assets acquired before or reacquired after the effective -
date of this Circular is not allowable.
(ii)For debt arrangements over$1 million, unless the non-profit organization makes an initial equity
contribution to the asset purchase of 25 percent or more,non-profit organizations shall reduce claims for
interest expense by an amount equal to imputed interest earnings on excess cash flow,which is to be
calculated as follows. Annually,non-profit organizations shall prepare a cumulative(from the inception of
the project)report of monthly cash flows that includes inflows and outflows,regardless of the funding
source. Inflows consist of depreciation expense, amortization of capitalized construction interest,and
annual interest!expense. For cash flow calculations, the annual inflow figures shall be divided by the
number of months in the year(usually 12)that the building is in service for monthly amounts. Outflows
consist of initial equity contributions,debt principal payments(less the pro rata share attributable to the
unallowable costs of land)and interest payments. Where cumulative inflows exceed cumulative outflows,
interest shall be calculated on the excess inflows for that period and be treated as a reduction to allowable
interest expense. The rate of interest to be used to compute earnings on excess cash flows shall be the three
month Treasury Bill closing rate as of the last business day of that month.
(iii) Substantial relocation of federally-sponsored activities from a facility financed by indebtedness,the
cost of which was funded in whole or part through Federal reimbursements, to another facility prior to the
expiration of a period of 20 years requires notice to the Federal cognizant agency. The extent of the
relocation, the amount of the Federal participation in the financing, and the depreciation and interest
charged to date may require negotiation and/or downward adjustments of replacement space charged to
Federal programs in the future.
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(iv)The allowable costs to acquire facilities and equipment are limited to a fair market value available to
the non-profit organization from an unrelated("arm's length")third party.
(2)For non-profit organizations subject to"full coverage"'under the Cost Accounting Standards(CAS)as
defined at 48 CFR 9903.201,the interest allowability provisions of subparagraph a do not apply. Instead,
these organizations'sponsored agreements are subject to CAS 414(48 CFR 9903.414),cost of money as an
element of the cost of facilities capital,and CAS 417(48 CFR 9903.417),cost of money as an element of
the cost of capital assets under construction.
(3)The following definitions are to be used for purposes of paragraph 23:
(a)Re-acquired assets means assets held by the non-profit organization prior to the effective date of this
revision that have again come to be held by the organization,whether through repurchase or refinancing. It
does not include assets acquired to replace older assets.
(b)Initial equity contribution means the amount or value of contributions made by non-Federal entities
for the acquisition of the asset or prior to occupancy of facilities.
(c)Asset costs means the capitalizable costs of an asset, including construction costs, acquisition costs, and
other such costs capitalized in accordance with GAAP.
b. Costs of organized fundraising, including financial campaigns, endowment drives,solicitation of gifts
and bequests,and similar expenses incurred solely to raise capital or obtain contributions are unallowable.
c. Costs of investment counsel and staff and similar expenses incurred solely to enhance income from
investments are unallowable.
d. Fundraising and investment activities shall be allocated an appropriate share of indirect costs under the
conditions described in subparagraph 8.3 of Attachment A.
24. Labor relations costs. Costs incurred in maintaining satisfactory relations between the organization
and its employees,including costs of labor management committees, employee publications, and other
related activities are allowable.
25. Lobbying.
a. Notwithstanding other provisions of this Circular, costs associated with the following activities are
unallowable:
(1)Attempts to influence the outcomes of any Federal,State, or local election,referendum, initiative, or
similar procedure,through in kind or cash contributions,endorsements,publicity,or similar activity;
(2)Establishing, administering,contributing to,or paying the expenses of a political party,campaign,
political action committee,or other organization established for the purpose of influencing the outcomes of
elections;
(3)Any attempt to influence: (i)The introduction of Federal or State legislation;or(ii)the enactment or
modification of any pending Federal or State legislation through communication with any member or
employee of the Congress or State legislature(including efforts to influence State or local officials to
engage in similar lobbying activity),or with any Government official or employee in connection with a
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decision to sign or veto enrolled legislation;
(4)Any attempt to influence: (i)The introduction of Federal or State legislation; or(ii)the enactment or
modification of any pending Federal or State legislation by preparing,distributing or using publicity or
propaganda,or by urging members of the general public or any segment thereof to contribute to or
participate in any mass demonstration, march, rally, fundraising drive, lobbying campaign or letter writing
or telephone campaign; or
(5)Legislative liaison activities, including attendance at legislative sessions or committee hearings,
gathering information regarding legislation,and analyzing the effect of legislation,when such activities are
carried on in support of or in knowing preparation for an effort to engage in unallowable lobbying.
b. The following activities are excepted from the coverage of subparagraph a:
(1) Providing a technical and factual presentation of information on a topic directly related to the
performance of a grant,contract or other agreement through hearing testimony, statements or letters to the
Congress or a State legislature,or subdivision, member,or cognizant staff member thereof, in response to a
documented request(including a Congressional Record notice requesting testimony or statements for the
record at a regularly scheduled hearing)made by the recipient member, legislative body or subdivision,or a
cognizant staff member thereof;provided such information is readily obtainable and can be readily put in
deliverable form;and further provided that costs under this section for travel, lodging or meals are
unallowable unless incurred to offer testimony at a regularly scheduled Congressional hearing pursuant to a
written request for such presentation made by the Chairman or Ranking Minority Member of the
Committee or Subcommittee conducting such hearing.
(2)Any lobbying made unallowable by subparagraph a(3)to influence State legislation in order to
directly reduce the cost, or to avoid material impairment of the organization's authority to perform the
grant, contract,or other agreement.
(3) Any activity specifically authorized by statute to be undertaken with funds from the grant,contract,or
other agreement.
c. (1) When an organization seeks reimbursement for indirect costs, total lobbying costs shall be separately
identified in the indirect cost rate proposal, and thereafter treated as other unallowable activity costs in
accordance with the procedures of subparagraph B.3 of Attachment A.
(2) Organizations shall submit,as part of the annual indirect cost rate proposal, a certification that the
requirements and standards of this paragraph have been complied with.
•
(3)Organizations shall maintain adequate records to demonstrate that the determination of costs as being
allowable or unallowable pursuant to paragraph 25 complies with the requirements of this Circular.
(4)Time logs, calendars, or similar records shall not be required to be created for purposes of complying
with this paragraph during any particular calendar month when: (1)the employee engages in lobbying(as
defined in subparagraphs (a) and(b)) 25 percent or less of the employee's compensated hours of
employment during that calendar month, and(2)within the preceding five-year period,the organization has
not materially misstated allowable or unallowable costs of any nature, including legislative lobbying costs.
When conditions(I) and (2)are met, organizations are not required to establish records to support the
allowabliliy of claimed costs in addition to records already required or maintained. Also,when conditions
(1) and(2)are met, the absence of time logs, calendars, or similar records will not serve as a basis for
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disallowing costs by contesting estimates of lobbying time spent by employees during a calendar month.
(5)Agencies shall establish procedures for resolving in advance, in consultation with OMB,any significant
questions or disagreements concerning the interpretation or application of paragraph 25. Any such
advance resolution shall be binding in any subsequent settlements,audits or investigations with respect to
that grant or contract for purposes of interpretation of this Circular;provided, however,that this shall not
be construed to prevent a contractor or grantee from contesting the lawfulness of such a determination.
26. Losses on other awards. Any excess of costs over income on any award is unallowable as a cost of
any other award. This includes,but is not limited to,the organization's contributed portion by reason of
cost sharing agreements or any under-recoveries through negotiation of lump sums for, or ceilings on,
indirect costs.
27. Maintenance and repair costs. Costs incurred for necessary maintenance, repair, or upkeep of
buildings and equipment(including Federal property unless otherwise provided for)which neither add to
the permanent value of the property nor appreciably prolong its intended life,but keep it in an efficient
operating condition, are allowable. Costs incurred for improvements which add to the permanent value of
the buildings and equipment or appreciably prolong their intended life shall be treated as capital
expenditures(see paragraph 15).
28. Materials and supplies. The costs of materials and supplies necessary to carry out an award are
allowable. Such costs should be charged at their actual prices after deducting all cash discounts,trade
discounts,rebates,and allowances received by the organization. Withdrawals from general stores or
stockrooms should be charged at cost under any recognized method of pricing consistently applied.
Incoming transportation charges may be a proper part of material cost. Materials and supplies charged as a
direct cost should include only the materials and supplies actually used for the performance of the contract
or grant, and due credit should be given for any excess materials or supplies retained,or returned to
vendors.
29. Meetings and conferences.
a. Costs associated with the conduct of meetings and conferences include the cost of renting facilities,
meals, speakers' fees, and the like. But see paragraph 14, Entertainment costs, and paragraph 34,
Participant support costs.
b. To the extent that these costs are identifiable with a particular cost objective, they should be charged to
that objective(see paragraph B of Attachment A). These costs are allowable,provided that they meet the
general tests of allowability, shown in paragraph A of Attachment A to this Circular.
c. Costs of meetings and conferences held to conduct the general administration of the organization are
allowable.
30. Memberships,subscriptions,,and professional activity costs.
a. Costs of the organization's membership in business,technical,and professional organizations are
allowable.
b. Costs of the organization's subscriptions to business,professional, and technical periodicals are
allowable.
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C. Costs of meetings and conferences,when the primary purpose is the dissemination of technical
information,are allowable. This includes costs of meals, transportation, rental of facilities,and other items
incidental to such meetings or conferences. •
d. Costs of membership in any civic or community organization are allowable with prior approval by
Federal cognizant agency.
e. Costs of membership in any country club or social or dining club or organization are unallowable.
31. Organization costs. Expenditures, such as incorporation fees, brokers' fees, fees to promoters,
organizers or management consultants, attorneys, accountants, or investment counselors,whether or not
employees of the organization, in connection with establishment or reorganization of an organization, are
unallowable except with prior approval of the awarding agency.
32. Overtime,extra-pay shift, and multi-shift premiums. Premiums for overtime, extra-pay shifts,and
multi-shift work are allowable only with the prior approval of the awarding agency except:
a. When necessary to cope with emergencies, such as those resulting from accidents,natural disasters,
breakdowns of equipment,or occasional operational bottlenecks of a sporadic nature.
b. When employees are performing indirect functions, such as administration,maintenance,or accounting.
c. In the performance of tests, laboratory procedures, or other similar operations which are continuous in
nature and cannot reasonably be interrupted or otherwise completed.
d. When lower overall cost to the Federal Government will result.
33. Page charges in professional journals. Page charges for professional journal publications are
allowable as a necessary part of research costs,where:
a. The research papers report work supported by the Federal Government; and
b. The charges are levied impartially on all research papers published by the journal,whether or not by
federally-sponsored authors.
34. Participant support costs. Participant support costs are direct costs for items such as stipends or
subsistence allowances,travel allowances, and registration fees paid to or on behalf of participants.For
trainees(but not employees) in connection with meetings,conferences, symposia,or training projects.
These costs are allowable with the prior approval of the awarding agency.
35. Patent costs.
a. Costs of(i)preparing disclosures, reports, and other documents required by the award and of searching
the art to the extent necessary to make such disclosures,(ii)preparing documents and any other patent costs
in connection with the filing and prosecution of a United States patent.application where title or
royalty-free license is required by the Federal Government to be conveyed to the Federal Government, and
(iii)general counseling services relating to patent and copyright matters, such as advice on patent and
copyright laws, regulations, clauses, and employee agreements are allowable(but see paragraph 39).
b. Cost of preparing disclosures, reports, and other documents and of searching the art to the extent
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necessary to make disclosures,if not required by the award,are unallowable. Costs in connection with(i)
filing and prosecuting any foreign patent application,or(ii)any United States patent application,where the
award does not require conveying title or a royalty-free license to the Federal Government, are unallowable
(also see paragraph 47).
36. Pension plans. See subparagraph 7.b.
37. Plant security costs. Necessary expenses incurred to comply with Federal security requirements or for
facilities protection, including wages,uniforms,and equipment of personnel are allowable.
38. Pre-award costs. Pre-award costs are those incurred prior to the effective date of the award directly
pursuant to the negotiation and in anticipation of the award where such costs are necessary to comply with
the proposed delivery schedule or period of performance. Such costs are allowable only to the extent that
they would have been allowable if incurred after the date of the award and only with the written approval
of the awarding agency.
39. Professional service costs.
a. Costs of professional and consultant services rendered by persons who are members of a particular
profession or possess a special skill, and who are not officers or employees of the organization,are
allowable, subject to subparagraphs b and c when reasonable in relation to the services rendered and
when not contingent upon recovery of the costs from the Federal Government.
b. In determining the allowability of costs in a particular case,no single factor or any special combination
of factors is necessarily determinative. However,the following factors are relevant:
(1)The nature and scope of the service rendered in relation to the service required.
(2)The necessity of contracting for the service,considering the organization's capability in the particular
area.
(3)The past pattern of such costs,particularly in the years prior to Federal awards.
(4)The impact of Federal awards on the organization's business(i.e.,what new problems have arisen).
(5)Whether the proportion of Federal work to the organization's total business is such as to influence the
organization in favor of incurring the cost,particularly where the services rendered are not of a continuing
nature and have little relationship to work under Federal grants and contracts.
(6)Whether the service can be performed more economically by direct employment rather than contracting.
(7)The qualifications of the individual or concern rendering the service and the customary fees charged,
especially on non-Federal awards.
(8)Adequacy of the contractual agreement for the service(e.g.,description of the service,estimate of time
required,rate of compensation, and termination provisions).
c. In addition to the factors in subparagraph b,retainer fees to be allowable must be supported by
evidence of bona fide services available or rendered.
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40. Profits and losses on disposition of depreciable property or other capital assets.
a. (1)Gains and losses on sale, retirement,or other disposition of depreciable property shall be included in
the year in which they occur as credits or charges to cost grouping(s)in which the depreciation applicable
to such property was included. The amount of the gain or loss to be included as a credit or charge to the
appropriate cost grouping(s)shall be the difference between the amount realized on the property and the
undepreciated basis of the property.
(2)Gains and losses on the disposition of depreciable property shall not be recognized as a separate credit
or charge under the following conditions:
(a)The gain or loss is processed through a depreciation reserve account and is reflected in the depreciation
allowable under paragraph 11.
(b)The property is given in exchange as part of the purchase price of a similar item and the gain or loss is
taken into account in determining the depreciation cost basis of the new item.
(c)A loss results from the failure to maintain permissible insurance, except as otherwise provided in
subparagraph 22.a(3).
(d) Compensation for the use of the property was provided through use allowances in lieu of depreciation
in accordance with paragraph 11.
(e)Gains and losses arising from mass or extraordinary sales,retirements,or other dispositions shall be
considered on a case-by-case basis.
b. Gains or losses of any nature arising from the sale or exchange of property other than the property
covered in subparagraph a shall be excluded in computing award costs.
41. Publication and printing costs.
a. Publication costs include the costs of printing(includiing.the processes of composition,plate-making,
press work,binding, and the end products produced by such processes),distribution,promotion,mailing,
and general handling.
b. If these costs are not identifiable with a particular cost objective,they should be allocated as indirect
costs to all benefiting activities of the organization.
c. Publication and printing costs are unallowable as direct costs except with the prior approval of the
awarding agency.
d. The cost of page charges in journals is addressed paragraph 33.
42. Rearrangement and alteration costs. Costs incurred for ordinary or normal rearrangement and
alteration of facilities are allowable. Special arrangement and alteration costs incurred specifically for the
project are allowable with the prior approval of the awarding agency.
43. Reconversion costs. Costs incurred in the restoration or rehabilitation of the organization's facilities to
approximately the same condition existing immediately prior to commencement of Federal awards, fair
wear and tear excepted, are allowable.
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44. Recruiting costs.
a. Subject to subparagraphs b,c,and d,and provided that the size of the staff recruited and maintained is
in keeping with workload requirements,costs of"help wanted” advertising,operating costs of an
employment office necessary to secure and maintain an adequate staff,costs of operating an aptitude and
educational testing program,travel costs of employees while engaged in recruiting personnel,travel costs
of applicants for interviews for prospective employment, and relocation costs incurred incident to
recruitment of new employees,are allowable to the extent that such costs are incurred pursuant to a
well-managed recruitment program. Where the organization uses employment agencies,costs that are not
in excess of standard commercial rates for such services are allowable.
b. In publications,costs of help wanted advertising that includes color, includes advertising material for
other than recruitment purposes,or is excessive in size(taking into consideration recruitment purposes for
which intended and normal organizational practices in this respect),are unallowable.
c. Costs of help wanted advertising,special emoluments, fringe benefits, and salary allowances incurred to
attract professional personnel from other organizations that do not meet the test of reasonableness or do not
conform with the established practices of the organization,are unallowable.
d. Where relocation costs incurred incident to recruitment of a new employee have been allowed either as
an allocable direct or indirect cost,and the newly hired employee resigns for reasons within his control
the organization required zation will be
within twelve months after being hired, g quired to refund or credit such relocation
costs to the Federal Government.
45. Relocation costs.
a. Relocation costs are costs incident to the permanent change of duty assignment(for an indefinite period
or for a stated period of not less than 12 months)of an existing employee or upon recruitment of a new
employee. Relocation costs are allowable,subject to the limitation described in subparagraphs b,c, and
d,provided that:
(1)The move is for the benefit of the employer.
(2)Reimbursement to the employee is in accordance with an established written policy consistently
followed by the employer.
(3)The reimbursement does not exceed the employee's actual(or reasonably estimated)expenses.
b. Allowable relocation costs for current employees are limited to the following:
(1)The costs of transportation of the employee,members of his immediate family and his household, and
personal effects to the new location.
(2)The costs of finding a new home, such as advance trips by employees and spouses to locate living
transitionperiod,upto maximum period of 30 days, including
ora lodging duringthe
quarters and temporary g g
advance trip time.
is
(3)Closing costs, such as brokerage,legal, and appraisal fees, incident to the disposition of the employee's
former home. These costs,together with those described in(4), are limited to 8 per cent of the sales price
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of the employee's former home.
(4)The continuing costs of ownership of the vacant former home after the settlement or lease date of the
employee's new permanent home,such as maintenance of buildings and grounds(exclusive of fixing up
expenses), utilities, taxes, and property insurance.
(5)Other necessary and reasonable expenses normally incident to relocation,such as the costs of canceling
an unexpired lease,disconnecting and reinstalling household appliances, and purchasing insurance against
loss of or damages to personal property. The cost of canceling an unexpired lease is limited to three times
the monthly rental.
c. Allowable relocation costs for new employees are limited to those described in(1) and (2)of
subparagraph b. When relocation costs incurred incident to the recruitment of new employees have been
allowed either as a direct or indirect cost and the employee resigns for reasons within his control within 12
months after hire, the organization shall refund or credit the Federal Government for its share of the cost.
However, the costs of travel to an overseas location shall be considered travel costs in accordance with
paragraph 55 and not relocation costs for the purpose of this paragraph if dependents are not permitted at
the location for any reason and the costs do not include costs of transporting household goods.
d. The following costs related to relocation are unallowable:
(1)Fees and other costs associated with acquiring a new home.
(2)A loss on the sale of a former home.
(3)Continuing mortgage principal and interest payments on a home being sold.
(4)Income taxes paid by an employee related to reimbursed relocation costs.
46. Rental costs.
a. Subject to the limitations described in subparagraphs b through d, rental costs are allowable to the
extent that the rates are reasonable in light of such factors as:rental costs of comparable property, if any;
market conditions in the area; alternatives available; and the type, life expectancy,condition,and value of
the property leased.
b. Rental costs under sale and leaseback arrangements are allowable only up to the amount that would be
allowed had the organization continued to own the property.
t.
l
c. Rental costs under less-than-arms-length leases are allowable only up to the amount that would be
allowed had title to the property vested in the organization. For this purpose,a less-than-arms-length lease
is one under which one party to the lease agreement is able to control or substantially influence the actions
of the other. Such leases include, but are not limited to those between(i)divisions of an organization;(ii)
organizations under common control through common officers,directors,or members; and(iii)an
organization and a director, trustee,officer,or key employee of the organization or his immediate family
either directly or through corporations, trusts,or similar arrangements in which they hold a controlling
interest.
d. Rental costs under leases which are required to be treated as capital leases under GAAP,are allowable
only up to the amount that would be allowed had the organization purchased the property on the date the
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lease agreement was executed, i.e., to the amount that minimally would pay for depreciation or use
allowances,maintenance,taxes, and insurance. Interest costs related to capitalized leases are allowable to
the extent they meet criteria in subparagraph 23.a. Unallowable costs include amounts paid for profit,
management fees,and taxes that would not have been incurred had the organization purchased the facility.
47. Royalties and other costs for use of patents and copyrights.
a. Royalties on a patent or copyright or amortization of the cost of acquiring by purchase a copyright,
patent,or rights thereto,necessary for the proper performance of the award are allowable unless:
(1)The Federal Government has a license or the right to free use of the patent or copyright.
(2)The patent or copyright has been adjudicated to be invalid,or has been administratively determined to
be invalid.
(3)The patent or copyright is considered to be unenforceable.
(4)The patent or copyright is expired.
b. Special care should be exercised in determining reasonableness where the royalties may have arrived at
as a result of less-than-arm's-length bargaining,e.g.:
(1)Royalties paid to persons, including corporations,affiliated with the organization.
(2)Royalties paid to unaffiliated parties,including corporations,under an agreement entered into in
contemplation that a Federal award would be made.
(3)Royalties paid under an agreement entered into after an award is made to an organization.
c. In any case involving a patent or copyright formerly owned by the organization,the amount of royalty
allowed should not exceed the cost which would have been allowed had the organization retained title
thereto.
48. Selling and marketing. Costs of selling and marketing any products or services of the organization
(unless allowed under paragraph I as allowable public relations costs)are unallowable. These costs,
however, are allowable as direct costs,with prior approval by awarding agencies, when they are necessary
for the performance of Federal programs.
49. Severance pay.
to as dismissal wages, is a payment in addition to regular salaries
a. Severance pay, also commonlyreferredg p ym g
and wages,by organizations 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 organization's part,or(iv)
circumstances of the particular employment.
b. Costs of severance payments are divided into two categories as follows:
(1)Actual normal turnover severance payments shall be allocated to all activities;or,where the
organization provides for a reserve for normal severances,such method will be acceptable if the charge to
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•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 organization.
(2)Abnormal or mass severance pay is of such a conjectural nature that measurement of costs 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 obligation to participate, to the extent of its fair share,in
any specific payment. Thus,allowability will be considered on a case-by-case basis in the event or
,occurrence.
c. Costs incurred in certain severance pay packages(commonly known as "a golden parachute"payment)
which are in an amount in excess of the normal severance pay paid by the organization 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 organization's assets are unallowable.
d. Severance payments to foreign nationals employed by the organization outside the United States,to the
extent that the amount exceeds the customary or prevailing practices for the organization in the United
States are unallowable, unless they are necessary for the performance of Federal programs and approved by
awarding agencies.
e. Severance payments to foreign nationals employed by the organization 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
organization in that country, are unallowable,unless they are necessary for the performance of Federal
programs and approved by awarding agencies.
50. Specialized service facilities.
a. The costs of services provided by highly complex or specialized facilities operated by the organization,
such as electronic computers and wind tunnels, are allowable,provided the charges for the services meet
the conditions of either subparagraph b or c and, in addition,take into account any items of income or
Federal financing that qualify as applicable credits under subparagraph A.5 of Attachment A.
b. The costs of such services, when material,must be charged directly to applicable awards based on actual
usage of the services on the basis of a schedule of rates or established methodology that(i)does not
discriminate against federally-supported activities of the organization, including usage by the organization
for internal purposes,and(ii) is designed to recover only the aggregate costs Of the services. The costs of
each service shall consist normally of both its direct costs and its allocable share of all indirect costs.
Advance agreements pursuant to subparagraph A.6 of Attachment A are particularly important in this
situation.
c. Where the costs incurred for a service are not material, they may be allocated as indirect costs.
5l. Taxes.
a: In general, taxes which the organization is required to pay and which are paid or accrued in accordance
with GAAP, and payments made to local governments in lieu of taxes which are commensurate with the
local government services received are allowable, except for(i)taxes from which exemptions are available
to the organization directly or which are available to the organization based on an exemption afforded the
Federal Government and in the latter case when the awarding agency makes available the necessary
exemption certificates,(ii)special assessments on land which represent capital improvements,and(iii)
Federal income taxes.
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b. Any refund of taxes, and any payment to the organization of interest thereon, which were allowed as
award costs,will be credited either as a cost reduction or cash refund, as appropriate,to the Federal
Government.
52.Termination costs. Termination of awards generally give rise to the incurrence of costs,or the need for
special treatment of costs,which would not have arisen had the award not been terminated. Cost principles
covering these items are set forth below. They are to be used in conjunction with the other provisions of
this Circular in termination situations.
a. Common items. The cost of items reasonably usable on the organization's other work shall not be
allowable unless the organization submits evidence that it would not retain such items at cost without
sustaining a loss. In deciding whether such items are reasonably usable on other work of the organization,
the awarding agency should consider the organization's plans and orders for current and scheduled activity.
Contemporaneous purchases of common items by the organization shall be regarded as evidence that such
items are reasonably usable on the organization's other work. Any acceptance of common items as
allocable to the terminated portion of the award shall be limited to the extent that the quantities of such
items on hand,in transit, and on order are in excess of the reasonable quantitative requirements of other
work.
b. Costs continuing after termination.If in a particular case,despite all reasonable efforts by the
organization,certain costs cannot be discontinued immediately after the effective date of termination, such
costs are generally allowable within the limitations set forth in this Circular, except that any such costs
continuing after termination due to the negligent or willful failure of the organization to discontinue such
costs shall be unallowable.
c. Loss of useful value. Loss of useful value of special tooling,machinery and equipment which was not
charged to the award as a capital expenditure is generally allowable if:
(1) Such special tooling,machinery,or equipment is not reasonably capable of use in the other work of the
organization.
(2)The interest of the Federal Government is protected by transfer of title or by other means deemed
appropriate by the awarding agency;
d. Rental costs. Rental costs under unexpired leases are generally allowable where clearly shown to have
been reasonably necessary for the performance of the terminated award less the residual value of such
leases,if(i)the amount of such rental claimed does not exceed the reasonable use value of the property
leased for the period of the award and such further period as may be reasonable,and(ii)the organization
makes all reasonable efforts to terminate,assign, settle,or otherwise reduce the cost of such lease.There
also may be included the cost of alterations of such leased property,provided such alterations were
necessary for the performance of the award,and of reasonable restoration required by the provisions of the
lease.
e. Settlement expenses. Settlement expenses including the following are generally allowable:
(1)Accounting, legal,clerical, and similar costs reasonably necessary for:
(a)The preparation and presentation to awarding agency of settlement claims and supporting data with
respect to the terminated portion of the award,unless the termination is for default(see Sec._.61 of
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Circular A-110); and
(b)The termination and settlement of subawards.
(2)Reasonable costs for the storage,transportation,protection,and disposition of property provided by the
Federal Government or acquired or produced for the award, except when grantees or contractors are
reimbursed for disposals at a predetermined amount in accordance with Sec. _.30 through_37 of
Circular A-110.
(3) Indirect costs related to salaries and wages incurred as settlement expenses in subparagraphs(1)and
(2).Normally,such indirect costs shall be limited to fringe benefits,occupancy cost, and immediate
supervision.
f. Claims under subawards. Claims under subawards, including the allocable portion of claims which are
common to the award, and to other work of the organization are generally allowable. An appropriate share
of the organization's indirect expense may be allocated to the amount of settlements with subcontractors
and/or subgrantees,provided that the amount allocated is otherwise consistent with the basic guidelines
contained in Attachment A. The indirect expense so allocated shall exclude the same and similar costs
claimed directly or indirectly as settlement expenses.
53. Training and education costs.
a. Costs of preparation and maintenance of a program of instruction including but not limited to on-the-job,
classroom, and apprenticeship training, designed to increase the vocational effectiveness of employees,
including training materials, textbooks,salaries or wages of trainees(excluding overtime compensation
which might arise therefrom),and(i)salaries of the director of training and staff when the training program
is conducted by the organization; or(ii)tuition and fees when the training is in an institution not operated
by the organization,are allowable.
b. Costs of part-time education, at an undergraduate or post-graduate college level, including that provided
at the organization's own facilities, are allowable only when the course or degree pursued is relative to the
field in which the employee is now working or may reasonably be expected to work,and are limited to:
(1)Training materials.
(2) Textbooks.
(3) Fees charges by the educational institution.
(4) Tuition charged by the educational institution or, in lieu of tuition, instructors'salaries and the related
share of indirect costs of the educational institution to the extent that the sum thereof is not in excess of the
tuition which would have been paid to the participating educational institution.
(5) Salaries and related costs of instructors who are employees of the organization.
(6)Straight-time compensation of each employee for time spent attending classes during working hours not
in excess of 156 hours per year and only to the extent that circumstances do not permit the operation of
classes or attendance at classes after regular working hours;otherwise,such compensation is unallowable.
c. Costs of tuition, fees, training materials, and textbooks(but not subsistence, salary,or any other
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emoluments)in connection with full-time education,including that provided at the organization's own
facilities, at a post-graduate(but not undergraduate)college level,are allowable only when the course or
degree pursued is related to the field in which the employee is now working or may reasonably be expected
to work,and only where the costs receive the prior approval of the awarding agency. Such costs are limited
to the costs attributable to a total period not to exceed one school year for each employee so trained. In
unusual cases the period may be extended.
d. Costs of attendance of up to 16 weeks per employee per year at specialized programs specifically
designed to enhance the effectiveness of executives or managers or to prepare employees for such positions
are allowable. Such costs include enrollment fees,training materials, textbooks and related charges,
employees'salaries, subsistence,and travel. Costs allowable under this paragraph do not include those for
courses that are part of a degree-oriented curriculum,which are allowable only to the extent set forth in
subparagraphs b and c.
e. Maintenance expense,and normal depreciation or fair rental,on facilities owned or leased by the
organization for training purposes are allowable to the extent set forth in paragraphs 11,27,and 46.
f. Contributions or donations to educational or training institutions, including the donation of facilities or
other properties, and scholarships or fellowships, are unallowable.
g. Training and education costs in excess of those otherwise allowable under subparagraphs b and c may
be allowed with prior approval of the awarding agency. To be considered for approval,the organization
must demonstrate that such costs are consistently incurred pursuant to an established training and education
program, and that the course or degree pursued is relative to the field in which the employee is now
working or may reasonably be expected to work.
54.Transportation costs. Transportation costs include freight,express,cartage,and postage charges
relating either to goods purchased, in process,or delivered. These costs are allowable. When such costs can
readily be identified with the items involved,they may be directly charged as transportation costs or added
to the cost of such items(see paragraph 28). Where identification with the materials received cannot
readily be made,transportation costs may be charged to the appropriate indirect cost accounts if the
organization follows a consistent,equitable procedure in this respect.
55. Travel costs.
a.Travel costs are the expenses for transportation, lodging,subsistence, and related items incurred by
employees who are in travel status on official business of the organization. Travel costs are allowable
subject to subparagraphs b through e, when they are directly attributable to specific work under an award
or are incurred in the normal course of administration of the organization.
b. Such costs may be charged on an actual basis,on a per diem or mileage basis in lieu of actual costs
incurred,or on a combination of the two,provided the method used results in charges consistent with those
normally allowed by the organization in its regular operations.
c. The difference in cost between first-class air accommodations and less than first-class air
accommodations is unallowable except when less than first-class air accommodations are not reasonably
available to meet necessary mission requirements, such as where less than first-class accommodations
would(i)require circuitous routing, (ii)require travel during unreasonable hours,(iii)greatly increase the
duration of the flight,(iv)result in additional costs which would offset the transportation savings,or(v)
offer accommodations which are not reasonably adequate for the medical needs of the traveler.
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d. Necessary and reasonable costs of family movements and personnel movements of a special or mass
nature are allowable,pursuant to paragraphs 44 and 45, subject to allocation on the basis of work or time
period benefited when appropriate. Advance agreements are particularly important.
e. Direct charges for foreign travel costs are allowable only when the travel has received prior approval of
the awarding agency. Each separate foreign trip must be approved. For purposes of this provision, foreign
travel is defined as any travel outside of Canada and the United States and its territories and possessions.
However, for an organization located in foreign countries,the term "foreign travel"means travel outside
that country.
56. Trustees. Travel and subsistence costs of trustees(or directors)are allowable. The costs are subject to
restrictions regarding lodging, subsistence and air travel costs provided in paragraph 55.
ATTACHMENT C
Circular No. A-122
NON-PROFIT ORGANIZATIONS NOT SUBJECT TO THIS CIRCULAR
Aerospace Corporation, El Segundo,California
Argonne National Laboratory,Chicago, Illinois
Atomic Casualty Commission,Washington, D.C.
Battelle Memorial Institute,Headquartered in Columbus,Ohio
Brookhaven National Laboratory, Upton,New York
Charles Stark Draper Laboratory, Incorporated,Cambridge,Massachusetts
Environmental Institute of Michigan, Ann Arbor,Michigan
Hanford Environmental Health Foundation, Richland, Washington
IIT Research Institute, Chicago, Illinois
Institute for Defense Analysis, Alexandria, Virginia
Mitre Corporation, Bedford,Massachusetts
National Radiological Astronomy Observatory,Green Bank, West Virginia
National Renewable Energy Laboratory,Golden,Colorado
Oak Ridge Associated Universities,Oak Ridge,Tennessee
Rand Corporation, Santa Monica, California
Research Triangle Institute,Research Triangle Park,North Carolina
Riverside Research Institute,New York, New York
Southern Research Institute,Birmingham, Alabama •
Southwest Research Institute,San Antonio, Texas
SRI International, Menlo Park, California
Syracuse Research Corporation, Syracuse,New York
Universities Research Association, Incorporated(National Acceleration Lab),Argonne,Illinois
Non-profit insurance companies, such as Blue Cross and Blue Shield Organizations
Other non-profit organizations as negotiated with awarding agencies
BILLING CODE 3110-01
1 OMB Home Page I Budget Information I Legislative Information I Management ReformJGPRA
I Grants Management I Financial Management I Procurement Policy
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OMB CircularA-I22 nup.//v% cc.au
Information&Regulatory Policy I Special Topics
Read our Privacy Policy
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OMB Circular No. A-133 Page l of 33
EXHIBIT M
Circular No. A-133 Revised June 24, 1997
Audits of States, Local Governments, and Non-Profit
Organizations
Accompanying Federal Register Materials--Audits of States,.Local Governments,and Non-
Profit Oreanizations June 30,19911
TO THE HEADS OF EXECUTIVE DEPARTMENTS AND ESTABLISHMENTS
SUBJECT: Audits of States,Local Governments,and Non-Profit Organizations
1. Purpose.This Circular is issued pursuant to the Single Audit Act of 1984,P.L. 98-502,and the
Single Audit Act Amendments of 1996,P.L, 104-156. It sets forth standards for obtaining
consistency and uniformity among Federal agencies for the audit of States, local governments,and
non-profit organizations expending Federal awards.
2.Authority. Circular A-133 is issued under the authority of sections 503, 1111, and 7501 et seq.of
title 31,United States Code,and Executive Orders 8248 and 11541.
3. Rescission and Supersession.This Circular rescinds Circular A-128, "Audits of State and Local
Governments," issued April 12, 1985,and supersedes the prior Circular A-133, "Audits of
Institutions of Higher Education and Other Non-Profit Institutions," issued April 22, 1996.For
effective dates,see paragraph 10.
4. Policy. Except as provided herein,the standards set forth in this Circular shall be applied by all
Federal agencies. If any statute specifically prescribes policies or specific requirements that differ
from the standards provided herein,the provisions of the subsequent statute shall govern.
Federal agencies shall apply the provisions of the sections of this Circular to non-Federal entities,
whether they are recipients expending Federal awards received directly from Federal awarding
agencies,or are subrecipients expending Federal awards received from a pass-through entity(a
recipient or another subrecipient).
This Circular does not apply to non-U.S.based entities expending Federal awards received either
directly as a recipient or indirectly as a subrecipient.
5.Definitions. The definitions of key terms used in this Circular are contained in § .105 in the
Attachment to this Circular.
6. Required Action. The specific requirements and responsibilities of Federal agencies and non-
Federal entities are set forth in the Attachment to this Circular.Federal agencies making awards to
non-Federal entities,either directly or indirectly,shall adopt the language in the Circular in codified
regulations as provided in Section 10(below),unless different provisions are required by Federal
statute or are approved by the Office of Management and Budget(OMB).
7.OMB Responsibilities. OMB will review Federal agency regulations and implementation of this
Circular,and will provide interpretations of policy requirements and assistance to ensure uniform,
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OMB Circular No. A-133 Page 2 of 33
effective and efficient implementation.
8. Information Contact. Further information concerning Circular A-133 may be obtained by
contacting the Financial Standards and Reporting Branch,Office of Federal Financial Management,
Office of Management and Budget,Washington,DC 20503,telephone(202)395-3993.
9. Review Date. This Circular will have a policyreview three years from the date of issuance.
10. Effective Dates. The standards set forth in § .400 of the Attachment to this Circular,which
apply directly to Federal agencies, shall be effective July 1, 1996,and shall apply to audits of fiscal
years beginning after June 30, 1996,except as otherwise specified in § .400(a).
The standards set forth in this Circular that Federal agencies shall apply to non-Federal entities shall
be adopted by Federal agencies in codified regulations not later than 60 days after publication of this
final revision in the Federal Register, so that they will apply to audits of fiscal years beginning after
June 30, 1996,with the exception that § .305(b)of the Attachment applies to audits of fiscal years
beginning after June 30, 1998. The requirements of Circular A-128, although the Circular is
rescinded,and the 1990 version of Circular A-133 remain in effect for audits of fiscal years beginning
on or before June 30, 1996.
Franklin D. Raines
Director
Attachment
PART_--AUDITS OF STATES, LOCAL GOVERNMENTS,AND NON-PROFIT
ORGANIZATIONS
Subpart A_General
Sec.
_.100 Purpose.
_.105 Definitions.
S ibpartB_.-.-Audits
_.200 Audit requirements.
_.205 Basis for determining Federal awards expended.
.210 Subrecipient and vendor determinations.
_.215 Relation to other audit requirements.
_.220 Frequency of audits.
_.225 Sanctions.
_.230 Audit costs.
_.235 Program-specific audits.
Subpart C- Auditees.
_.300 Auditee responsibilities.
.305 Auditor selection.
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.310 Financial statements.
.315 Audit findings follow-up.
.320 Report submission.
Subpart D- Federal Agencies and Pass-Through Entities
.400 Responsibilities.
.405 Management decision.
SubpartE--Auditors
.500 Scope of audit.
.505 Audit reporting.
�.510 Audit findings.
.515 Audit working papers.
.520 Major program determination.
J.525 Criteria for Federal program risk.
.530 Criteria for a low-risk auditee.
Appendix A to Part_-Data Collection Form(Form SF-SAC).
Appendix B to Part—-Circular A-133 Compliance Supplement.
Subpart A--General
§ .100 Purpose.
This part sets forth standards for obtaining consistency and uniformity among Federal agencies for
the audit of non-Federal entities expending Federal awards.
§ .105 Definitions.
Auditee means any non-Federal entity that expends Federal awards which must be audited under this
part. Auditor means an auditor,that is a public accountant or a Federal,State or local government
audit organization,which meets the general standards specified in generally accepted government
auditing standards(GAGAS). The term auditor does not include internal auditors of non-profit
organizations.
Audit finding means deficiencies which the auditor is required by§ .510(a)to report in the
schedule of findings and questioned costs.
CFDA number means the number assigned to a Federal program in the Catalog of Federal
Domestic Assistance(CFDA).
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 the Office of Management
and Budget(OMB)in the compliance supplement or as designated by a State for Federal awards the
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State provides to its subrecipients that meet the definition of a cluster of programs. When designating
an"other cluster,"a State shall identify the Federal awards included in the cluster and advise the
subrecipients of compliance requirements applicable to the cluster,consistent with§ .400(d)(1)
and§ .400(dx2),respectively. A cluster of programs shall be considered as one program for
determining major programs, as described in§ .520,and,with the exception of R&D as described
in§ .200(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§ .400(a).
Compliance supplement refers to the Circular A-133 Compliance Supplement, included as
Appendix B to Circular A-133,or such documents as OMB or its designee may issue to replace it.
This document is available from the Government Printing Office, Superintendent of Documents,
Washington,DC 20402-9325.
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.
Federal agency has the same meaning as the term agency in Section 551(1)of title 5,United States
Code.
Federal award means Federal financial assistance and Federal cost-reimbursement contracts that
non-Federal entities receive directly from Federal awarding agencies or indirectly from pass-through
entities. It does not include procurement contracts,under grants or contracts, used to buy goods or
services from vendors. Any audits of such vendors shall be covered by the terms and conditions of
the contract. Contracts to operate Federal Government owned,contractor operated facilities(GOCOs)
are excluded from the requirements of this part.
Federal awarding agency means the Federal agency that provides an award directly to the recipient.
Federal financial assistance means assistance that non-Federal entities receive or administer in the •
form of grants, loans, loan guarantees,property(including donated surplus property),cooperative
agreements, interest subsidies, insurance, food commodities,direct appropriations, and other
assistance,but does not include amounts received as reimbursement for services rendered to
individuals as described in§ .205(h)and§_.205(i).
Federal program means:
(1)All Federal awards to a non-Federal entity assigned a single number in the CFDA.
(2)When no CFDA number is assigned, all Federal awards from the same agency made for the same
purpose should be combined and considered one program.
(3)Notwithstanding paragraphs(1)and(2)of this definition,a cluster of programs. The types of
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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 in this section.
GAGAS means generally accepted government auditing standards issued by the Comptroller General
of the United States, which are applicable to financial audits.
Generally accepted accounting principles has the meaning specified in generally accepted auditing
standards issued by the American Institute of Certified Public Accountants(AICPA).
Indian tribe means any Indian tribe,band,nation,or other organized group or community, including
any Alaskan Native village or regional or village corporation(as defined in,or established under,the
Alaskan Native Claims Settlement Act)that is recognized by the United States as eligible for the
special programs and services provided by the United States to Indians because of their status as
Indians.
Internal control means a process,effected by an entity's management and other personnel,designed
to provide reasonable assurance regarding the achievement of objectives in the following categories:
(1)Effectiveness and efficiency of operations;
(2)Reliability of financial reporting;and
(3)Compliance with applicable laws and regulations.
Internal control pertaining to the compliance requirements for Federal programs(Internal
control over Federal programs)means a process--effected by an entity's management and other
personnel--designed to provide reasonable assurance regarding the achievement of the following
objectives for Federal programs:
(1)Transactions are properly recorded and accounted for to:
(i)Permit the preparation of reliable financial statements and Federal reports;
(ii)Maintain accountability over assets; and
(iii)Demonstrate compliance with laws, regulations,and other compliance requirements;
(2)Transactions are executed in compliance with:
(i)Laws,regulations,and the provisions of contracts or grant agreements that could have a direct and
material effect on a Federal program; and
(ii)Any other laws and regulations that are identified in the compliance supplement; and
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(3)Funds,property, and other assets are safeguarded against loss from unauthorized use or
disposition.
Loan means a Federal loan or loan guarantee received or administered by a non-Federal entity.
Local government means any unit of local government within a State, including a county,borough,
municipality,city,town,township,parish, local public authority, special district, school district,
intrastate district,council of governments, and any other instrumentality of local government.
Major program means a Federal program determined by the auditor to be a major program in
accordance with§_.520 or a program identified:as a major program by a Federal agency or pass-
through entity in accordance with §_.215(c).
Management decision means the evaluation by the Federal awarding agency or pass-through entity
of the audit findings and corrective action plan and the issuance of a written decision as to what
corrective action is necessary.
Non-Federal entity means a State, local government, or non-profit organization.
Non-profit organization means:
(1)any corporation,trust,association,cooperative,or other organization that:
(i)Is operated primarily for scientific,educational,service,charitable,or similar purposes in the
public interest;
(ii)Is not organized primarily for profit; and
(iii)Uses its net proceeds to maintain, improve,or expand its operations;and
(2)The term non-profit organization includes non-profit institutions of higher education and
hospitals.
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 direct funding to a recipient not assigned a cognizant agency for audit. When there is no
direct funding,the Federal agency with the predominant indirect funding shall assume the oversight
responsibilities. The duties of the oversight agency for audit are described in§..400(b).
Pass-through entity means a non-Federal entity that provides a Federal award to a subrecipient to
carry out a Federal program.
Program-specific audit means an audit of one Federal program as provided for in§_.200(c)and
§_.235.
Questioned cost means a cost that is questioned by the auditor because of an audit finding:
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(1)Which resulted from a violation or possible violation of a provision of a law,regulation,contract,
grant,cooperative agreement,or other agreement or document governing the use of Federal funds,
including 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.
Recipient means a non-Federal entity that expends Federal awards received directly from a Federal
awarding agency to carry out a Federal program.
Research and development(R&D)means all research activities,both basic and applied, and all
development activities that are performed by a non-Federal entity. Research is defined as a
systematic study directed toward fuller scientific knowledge or understanding of the subject studied.
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. 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.
Single audit means an audit which includes both the entity's financial statements and the Federal
awards as described in§ .500.
State means any State of the United States,the District of Columbia,the Commonwealth of Puerto
Rico,the Virgin Islands,Guam,American Samoa,the Commonwealth of the Northern Mariana
Islands, and the Trust Territory of the Pacific Islands,any instrumentality thereof,any multi-State,
regional,or interstate entity which has governmental functions, and any Indian tribe as defined in this
section.
Student Financial Aid(SFA)includes 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 et seq.)
which is administered by the U.S. Department of Education,and similar programs provided by other
Federal agencies. It does not include programs which provide fellowships or similar Federal awards
to students on a competitive basis,or for specified studies or research.
Subrecipient means a non-Federal entity that expends Federal awards received from a pass-through
entity to carry out a Federal program,but does not include an individual that is a beneficiary of such a
program. A subrecipient may also be a recipient of other Federal awards directly from a Federal
awarding agency. Guidance on distinguishing between a subrecipient and a vendor is provided in
§ .210.
Types of compliance requirements refers to the types of compliance requirements listed in the
compliance supplement. Examples include: activities allowed or unallowed; allowable costs/cost
principles;cash management; eligibility;matching,level of effort,earmarking;and,reporting.
Vendor means a dealer,distributor,merchant,or other seller providing goods or services that are
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required for the conduct of a Federal program. These goods or services may be for an organization's
own use or for the use of beneficiaries of the Federal program. Additional guidance on distinguishing
between a subrecipient and a vendor is provided in § .210.
... .... ............. .... ..
Subpart B--Audits
§ .200 Audit requirements.
(a)Audit required.Non-Federal entities that expend$300,000 or more in a year in Federal awards
shall have a single or program-specific audit conducted for that year in accordance with the
provisions of this part. Guidance on determining Federal awards expended is provided in § .205.
(b)Single audit. Non-Federal entities that expend$300,000 or more in a year in Federal awards shall
have a single audit conducted in accordance with § .500 except when they elect to have a program-
specific audit conducted in accordance with paragraph(c)of this section.
(c)Program-specific audit election. When an auditee expends Federal awards under only one
Federal program(excluding R&D)and the Federal program's laws,regulations,or grant agreements
do not require a financial statement audit of the auditee,the auditee may elect to have a program-
specific audit conducted in accordance with § .235. A program-specific audit may not be elected
for R&D unless all of the Federal awards expended were received from the same Federal agency,or
the same Federal agency and the same pass-through entity,and that Federal agency,or pass-through
entity in the case of a subrecipient,approves in advance a program-specific audit.
(d)Exemption when Federal awards expended are less than $300,000. Non-Federal entities that
expend less than $300,000 a year in Federal awards are exempt from Federal audit requirements for
that year,except as noted in§ .215(a),but records must be available for review or audit by
appropriate officials of the Federal agency,pass-through entity,and General Accounting Office
(GAO).
(e) Federally Funded Research and Development Centers(FFRDC).Management of an auditee
that owns or operates a FFRDC may elect to treat the FFRDC as a separate entity for purposes of this
part.
§ .205 Basis for determining Federal awards expended.
(a)Determining Federal awards expended. The determination of when an award is expended
should be based on when the activity related to the award occurs. Generally,the activity pertains to
events that require the non-Federal entity to comply with laws,regulations, and the provisions of
contracts or grant agreements, such as: expenditure/expense transactions associated with grants,cost-
reimbursement contracts, cooperative agreements,and direct appropriations; the disbursement of
funds passed through to subrecipients; the use of loan proceeds under loan and loan guarantee
programs; the receipt of property; the receipt of surplus property; the receipt or use of program
income; the distribution or consumption of food commodities;the disbursement of amounts entitling
the non-Federal entity to an interest subsidy; and,the period when insurance is in force.
(b) Loan and loan guarantees(loans). Since the Federal Government is at risk for loans until the
debt is repaid, the following guidelines shall be used to calculate the value of Federal awards
expended under loan programs, except as noted in paragraphs(c)and(d)of this section:
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(1)Value of new loans made or received during the fiscal year;plus
(2)Balance of loans from previous years for which the Federal Government imposes continuing
compliance requirements;plus
(3)Any interest subsidy,cash,or administrative cost allowance received.
(c)Loan and loan guarantees(loans) at institutions of higher education. When loans are made to
students of an institution of higher education but the institution does not make the loans, then only the
value of loans made during the year shall be considered Federal awards expended in that year. The
balance of loans for previous years is not included as Federal awards expended because the lender
accounts for the prior balances.
(d)Prior loan and loan guarantees(loans). Loans,the proceeds of which were received and
expended in prior-years, are not considered Federal awards expended under this part when the laws,
regulations,and the provisions of contracts or grant agreements pertaining to such loans impose no
continuing compliance requirements other than to repay the loans.
(e)Endowment funds. The cumulative balance of Federal awards for endowment funds which are
federally restricted are considered awards expended in each year in which the funds are still
restricted.
(f)Free rent. Free rent received by itself is not considered a Federal award expended under this part.
However, free rent received as part of an award to carry out a Federal program shall be included in
determining Federal awards expended and subject to audit under this part.
(g)Valuing non-cash assistance. Federal non-cash assistance,such as free rent, food stamps, food
commodities,donated property,or donated surplus property, shall be valued at fair market value at
the time of receipt or the assessed value provided by the Federal agency.
(h)Medicare. Medicare payments to a non-Federal entity for providing patient care services to
Medicare eligible individuals are not considered Federal awards expended under this part.
(i)Medicaid. Medicaid payments to a subrecipient for providing patient care services to Medicaid
eligible individuals are not considered Federal awards expended under this part unless a State
requires the funds to be treated as Federal awards expended because reimbursement is on a cost-
reimbursement basis.
(j)Certain loans provided by the National Credit Union Administration. For purposes of this
part, loans made from the National Credit Union Share Insurance Fund and the Central Liquidity
Facility that are funded by contributions from insured institutions are not considered Federal awards
expended.
§_.210 Subrecipient and vendor determinations.
(a)General. An auditee may be a recipient, a subrecipient, and a vendor. Federal awards expended as
a recipient or a subrecipient would be subject to audit under this part. The payments received for
goods or services provided as a vendor would not be considered Federal awards. The guidance in
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OMB Circular No. A-133 Pagel 0 of 33
paragraphs(b)and(c)of this section should be considered in determining whether payments
constitute a Federal award or a payment for goods and services.
(b)Federal award. Characteristics indicative of a Federal award received by a subrecipient are when
the organization:
(1)Determines who is eligible to receive what Federal financial assistance;
(2)Has its performance measured against whether the objectives of the Federal program are met;
(3)Has responsibility for programmatic decision making;
(4)Has responsibility for adherence to applicable Federal program compliance requirements; and
(5)Uses the Federal funds to carry out a program of the organization as compared to providing goods
or services for a program of the pass-through entity.
(c) Payment for goods and services. Characteristics indicative of a payment for goods and services
received by a vendor are when the organization:
(1)Provides the goods and services within normal business operations;
(2)Provides similar goods or services to many different purchasers;
(3)Operates in a competitive environment;
(4)Provides goods or services that are ancillary to the operation of the Federal program; and
(5) Is not subject to compliance requirements of the Federal program.
(d)Use of judgment in making determination. There may be unusual circumstances or exceptions
to the listed characteristics. In making the determination of whether a subrecipient or vendor
relationship exists, the substance of the relationship is more important than the form of the
agreement. It is not expected that all of the characteristics will be present and judgment should be
used in determining whether an entity is a subrecipient or vendor.
•
(e) For-profit subrecipient. Since this part does not apply to for-profit subrecipients, the pass
through entity is responsible for establishing requirements,as necessary, to ensure compliance by for-
profit subrecipients. The contract with the for-profit subrecipient should describe applicable
compliance requirements and the for-profit subrecipient's compliance responsibility. Methods to
ensure compliance for Federal awards made to for-profit subrecipients may include pre-award audits,
monitoring during the contract, and post-award audits.
(f)Compliance responsibility for vendors. In most cases, the auditee's compliance responsibility
for vendors is only to ensure that the procurement,receipt, and payment for goods and services
comply with laws, regulations, and the provisions of contracts or grant agreements. Program
compliance requirements normally do not pass through to vendors. However,the auditee is
responsible for ensuring compliance for vendor transactions which are structured such that the vendor
is responsible for program compliance or the vendor's records must be reviewed to determine
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program compliance. Also,when these vendor transactions relate to a major program, the scope of
the audit shall include determining whether these transactions are in compliance with laws,
regulations, and the provisions of contracts or grant agreements.
§ .215 Relation to other audit requirements.
(a)Audit under this part in lieu of other audits. An audit made in accordance with this part shall
be in lieu of any financial audit required under individual Federal awards. To the extent this audit
meets a Federal agency's needs, it shall rely upon and use such audits. The provisions of this part
neither limit the authority of Federal agencies, including their Inspectors General,or GAO to conduct
or arrange for additional audits(e.g., financial audits,performance audits, evaluations, inspections, or
reviews)nor authorize any auditee to constrain Federal agencies from carrying out additional audits.
Any additional audits shall be planned and performed in such a way as to build upon work performed
by other auditors.
(b)Federal agency to pay for additional audits. A Federal agency that conducts or contracts for
additional audits shall, consistent with other applicable laws and regulations, arrange for funding the
full cost of such additional audits.
(c)Request for a program to be audited as a major program. A Federal agency may request an
auditee to have a particular Federal program audited as a major program in lieu of the Federal agency
conducting or arranging for the additional audits. To allow for planning,such requests should be
made at least 180 days prior to the end of the fiscal year to be audited. The auditee,after consultation
with its auditor, should promptly respond to such request by informing the Federal agency whether
the program would otherwise be audited as a major program using the risk-based audit approach
described in§ .520 and, if not,the estimated incremental cost. The Federal agency shall then
promptly confirm to the auditee whether it wants the program audited as a major program. If the
program is to be audited as a major program based upon this Federal agency request, and the Federal
agency agrees to pay the full incremental costs,then the auditee shall have the program audited as a
major program. A pass-through entity may use the provisions of this paragraph for a subrecipient.
§_.220 Frequency of audits.
Except for the provisions for biennial audits provided in paragraphs(a) and(b)of this section, audits
required by this part shall be performed annually. Any biennial audit shall cover both years within the
biennial period.
(a)A State or local government that is required by constitution or statute, in effect on January 1,
1987,to undergo its audits less frequently than annually,is permitted to undergo its audits pursuant to
this part biennially. This requirement must still be in effect for the biennial period under audit.
(b)Any non-profit organization that had biennial audits for all biennial periods ending between July
1, 1992,and January 1, 1995, is permitted to undergo its audits pursuant to this part biennially.
§_.225 Sanctions.
No audit costs may be charged to Federal awards when audits required by this part have not been
made or have been made but not in accordance with this part. In cases of continued inability or
unwillingness to have an audit conducted in accordance with this part,Federal agencies and pass-
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through entities shall take appropriate action using sanctions such as:
(a)Withholding a percentage of Federal awards until the audit is completed satisfactorily;
(b)Withholding or disallowing overhead costs;
(c)Suspending Federal awards until the audit is conducted;or
(d)Terminating the Federal award.
§ .230 Audit costs.
(a)Allowable costs. Unless prohibited by law,the cost of audits made in accordance with the
provisions of this part are allowable charges to Federal awards. The charges may be considered a
direct cost or an allocated indirect cost, as determined in accordance with the provisions of applicable
OMB cost principles circulars,the Federal Acquisition Regulation(FAR)(48 CFR parts 30 and 31),
or other applicable cost principles or regulations.
(b)Unallowable costs. A non-Federal entity shall not charge the following to a Federal award:
(1)The cost of any audit under the Single Audit Act Amendments of 1996(31 U.S.C. 7501 et seq.)
not conducted in accordance with this part.
(2)The cost of auditing a non-Federal entity which has Federal awards expended of less than
$300,000 per year and is thereby exempted under§ .200(d) from having an audit conducted under
this part. However, this does not prohibit a pass-through entity from charging Federal awards for the
cost of limited scope audits to monitor its subrecipients in accordance with§_.400(d)(3),provided
the subrecipient does not have a single audit. For purposes of this part, limited scope audits only
include agreed-upon procedures engagements conducted in accordance with either the AICPA's
generally accepted auditing standards or attestation standards, that are paid for and arranged by a
pass-through entity and address only one or more of the following types of compliance requirements:
activities allowed or unallowed;allowable costs/cost principles; eligibility; matching,level of effort,
earmarking; and, reporting.
§ .235 Program-specific audits.
(a) Program-specific audit guide available. In many cases, a program-specific audit guide will be •
available to provide specific guidance to the auditor with respect to internal control,compliance
requirements, suggested audit procedures, and audit reporting requirements. The auditor should
contact the Office of Inspector General of the Federal agency to determine whether such a guide is
available. When a current program-specific audit guide is available, the auditor shall follow GAGAS
and the guide when performing a program-specific audit.
(b) Program-specific audit guide not available. (1)When a program-specific audit guide is not
available,the auditee and auditor shall have basically the same responsibilities for the Federal
program as they would have for an audit of a major program in a single audit.
(2)The auditee shall prepare the financial statement(s) for the Federal program that includes,at a
minimum, a schedule of expenditures of Federal awards for the program and notes that describe the
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significant accounting policies used in preparing the schedule, a summary schedule of prior audit
findings consistent with the requirements of§_.315(b), and a corrective action plan consistent with
the requirements of§_.315(c).
(3)The auditor shall: '
(i)Perform an audit of the financial statement(s) for the Federal program in accordance with
GAGAS;
(ii)Obtain an understanding of internal control and perform tests of internal control over the Federal
program consistent with the requirements of§__.500(c) for a major program;
(iii)Perform procedures to determine whether the auditee has complied with laws,regulations,and
the provisions of contracts or grant agreements that could have a direct and material effect on the
Federal program consistent with the requirements of§ .500(d) for a major program; and
(iv)Follow up on prior audit findings,perform procedures to assess the reasonableness of the
summary schedule of prior audit findings prepared by the auditee,and report, as a current year audit
finding,when the auditor concludes that the summary schedule of prior audit findings materially
misrepresents the status of any prior audit finding in accordance with the requirements of§ .500
(e).
(4)The auditor's report(s)may be in the form of either combined or separate reports and may be
organized differently from the manner presented in this section. The auditor's report(s)shall state that
the audit was conducted in accordance with this part and include the following:
(i)An opinion(or disclaimer of opinion)as to whether the financial statement(s)of the Federal
program is presented fairly in all material respects in conformity with the stated accounting policies;
(ii)A report on internal control related to the Federal program,which shall describe the scope of
testing of internal control and the results of the tests;
(iii)A report on compliance which includes an opinion(or disclaimer of opinion)as to whether the
auditee complied with laws,regulations, and the provisions of contracts or grant agreements which
could have a direct and material effect on the Federal program; and
(iv)A schedule of findings and questioned costs for the Federal program that includes a summary of
the auditor's results relative to the Federal program in a format consistent with§ .505(d)(1)and
findings and questioned costs consistent with the requirements of§ .505(d)(3).
(c)Report submission for program-specific audits.
(1)The audit shall be completed and the reporting required by paragraph(c)(2)or(cX3)of this
section submitted within the earlier of 30 days after receipt of the auditor's report(s),or nine months
after the end of the audit period,unless a longer period is agreed to in advance by the Federal agency
that provided the funding or a different period is specified in a program-specific audit guide.
(However, for fiscal years beginning on or before June 30, 1998,the audit shall be completed and the
required reporting shall be submitted within the earlier of 30 days after receipt of the auditor's report
(s),or 13 months after the end of the audit period,unless a different period is specified in a program-
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specific audit guide.)Unless restricted by law or regulation,the auditee shall make report copies
available for public inspection.
(2)When a program-specific audit guide is available, the auditee shall submit to the Federal
clearinghouse designated by OMB the data collection form prepared in accordance with§ .320(b),
as applicable to a program-specific audit,and the reporting required by the program-specific audit
guide to be retained as an archival copy. Also,the auditee shall submit to the Federal awarding
agency or pass-through entity the reporting required by the program-specific audit guide.
(3)When a program-specific audit guide is not available,the reporting package for a program-
specific audit shall consist of the financial statement(s)of the Federal program, a summary schedule
of prior audit findings, and a corrective action plan as described in paragraph(b)(2)of this section,
and the auditor's report(s)described in paragraph (b)(4)of this section. The data collection form
prepared in accordance with§ .320(b), as applicable to a program-specific audit, and one copy of
this reporting package shall be submitted to the Federal clearinghouse designated by OMB to be
retained as an archival copy. Also,when the schedule of findings and questioned costs disclosed audit
findings or the summary schedule of prior audit findings reported the status of any audit findings,the
auditee shall submit one copy of the reporting package to the Federal clearinghouse on behalf of the
Federal awarding agency,or directly to the pass-through entity in the case of a subrecipient. Instead
of submitting the reporting package to the pass-through entity,when a subrecipient is not required to
submit a reporting package to the pass-through entity, the subrecipient shall provide written
notification to the pass-through entity,consistent with the requirements of§ .320(e)(2).A
subrecipient may submit a copy of the reporting package to the pass-through entity to comply with
this notification requirement.
(d)Other sections of this part may apply. Program-specific audits are subject to§`.100 through
§ .215(b), § .220 through § .230, §_.300 through § .305, § .315, § .320(f)
through§ .320(0), § .400 through§ .405, §_.510 through§ .515,and other referenced
provisions of this part unless contrary to the provisions of this section,a program-specific audit
guide, or program laws and regulations.
Subpart C--Auditees
§_.300 Auditee responsibilities.
The auditee shall:
(a) Identify, in its accounts, all Federal awards received and expended and the Federal programs
under which they were received. Federal program and award identification shall include, as
applicable,the CFDA title and number, award number and year,name of the Federal agency, and
name of the pass-through entity.
(b)Maintain internal control over Federal programs that provides reasonable assurance that the
auditee is managing Federal awards in compliance with laws,regulations, and the provisions of
contracts or grant agreements that could have a material effect on each of its Federal programs.
(c)Comply with laws, regulations, and the provisions of contracts or grant agreements related to each
of its Federal programs.
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(d)Prepare appropriate financial statements, including the schedule of expenditures of Federal
awards in accordance with§_.310.
(e)Ensure that the audits required by this part are properly performed and submitted when due. When
extensions to the report submission due date required by§ .320(a)are granted by the cognizant or
oversight agency for audit,promptly notify the Federal clearinghouse designated by OMB and each
pass-through entity providing Federal awards of the extension.
(f)Follow up and take corrective action on audit findings, including preparation of a summary
schedule of prior audit findings and a corrective action plan in accordance with§ .315(b)and
§ .315(c),respectively.
§ .305 Auditor selection.
(a)Auditor procurement. In procuring audit services,auditees shall follow the procurement
standards prescribed by the Grants Management Common Rule(hereinafter referred to as the "A-102
Common Rule")published March 11, 1988 and amended April 19, 1995 [insert appropriate CFR
citation],Circular A-110, "Uniform Administrative Requirements for Grants and Agreements with
Institutions of Higher Education,Hospitals and Other Non-Profit Organizations," or the FAR(48
CFR part 42), as applicable(OMB Circulars are available from the Office of Administration,
Publications Office,room 2200,New Executive Office Building, Washington,DC 20503). Whenever
possible,auditees shall make positive efforts to utilize small businesses,minority-owned firms, and
women's business enterprises, in procuring audit services as stated in the A-102 Common Rule,OMB
Circular A-110,or the FAR(48 CFR part 42), as applicable. In requesting proposals for audit
services,the objectives and scope of the audit should be made clear. 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 external quality control reviews,and price.
(b)Restriction on auditor preparing indirect cost proposals. An auditor who prepares the indirect
cost proposal or cost allocation plan may not also be selected to perform the audit required by this
part when the indirect costs recovered by the auditee during the prior year exceeded$1 million. This
restriction applies to the base year used in the preparation of the indirect cost proposal or cost
allocation plan and any subsequent years in which the resulting indirect cost agreement or cost
allocation plan is used to recover costs. To minimize any disruption in existing contracts for audit
services,this paragraph applies to audits of fiscal years beginning after June 30, 1998.
(c)Use of Federal auditors. Federal auditors may perform all or part of the work required under this
part if they comply fully with the requirements of this part.
§_.310 Financial statements.
(a)Financial statements. The auditee shall prepare financial statements that reflect its financial
position,results of operations or changes in net assets,and,where appropriate, cash flows for the
fiscal year audited. The financial statements shall be for the same organizational unit and fiscal year
that is chosen to meet the requirements of this part. However,organization-wide financial statements
may also include departments, agencies, and other organizational units that have separate audits in
accordance with§ .500(a)and prepare separate financial statements.
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(b)Schedule of expenditures of Federal awards. The auditee shall also prepare a schedule of
expenditures of Federal awards for the period covered by the auditee's financial statements. While not
required,the auditee may choose to provide information requested by Federal awarding agencies and
pass-through entities to make the schedule easier to use. For example,when a Federal program has
multiple award years,the auditee may list the amount of Federal awards expended for each award
year separately. At a minimum,the schedule shall:
(1)List individual Federal programs by Federal agency. For Federal programs included in a cluster of
programs, list individual Federal programs within a cluster of programs. For R&D,total Federal
awards expended shall be shown either by individual award or by Federal agency and major
subdivision within the Federal agency. For example,the National Institutes of Health is a major
subdivision in the Department of Health and Human Services.
(2)For Federal awards received as a subrecipient, the name of the pass-through entity and identifying
number assigned by the pass-through entity shall be included.
(3)Provide total Federal awards expended for each individual Federal program and the CFDA
number or other identifying number when the CFDA information is not available.
(4) Include notes that describe the significant accounting policies used in preparing the schedule.
(5)To the extent practical,pass-through entities should identify in the schedule the total amount
provided to subrecipients from each Federal program.
(6) Include, in either the schedule or a note to the schedule,the value of the Federal awards expended
in the form of non-cash assistance, the amount of insurance in effect during the year, and loans or
loan guarantees outstanding at year end. While not required, it is preferable to present this
information in the schedule.
§ .315 Audit findings follow-up.
(a)General.The auditee is responsible for follow-up and corrective action on all audit findings. As
part of this responsibility,the auditee shall prepare a summary schedule of prior audit findings. The
auditee shall also prepare a corrective action plan for current year audit findings. The summary
schedule of prior audit findings and the corrective action plan shall include the reference numbers the
auditor assigns to audit findings under§ .5110.(c). Since the summary schedule may include audit
findings from multiple years, it shall include the fiscal year in which the finding initially occurred.
(b)Summary schedule of prior audit findings. The summary schedule of prior audit findings shall
report the status of all audit findings included in the prior audit's schedule of findings and questioned
costs relative to Federal awards. The summary schedule shall also include audit findings reported in
the prior audit's summary schedule of prior audit findings except audit findings listed as corrected in
accordance with paragraph(b)(1)of this section,or no longer valid or not warranting further action in
accordance with paragraph(b)(4)of this section.
(1) When audit findings were fully corrected,the summary schedule need only list the audit findings
and state that corrective action was taken.
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(2)When audit findings were not corrected or were only partially corrected, the summary schedule
shall describe the planned corrective action as well as any partial corrective action taken.
(3)When corrective action taken is significantly different from corrective action previously reported
in a corrective action plan or in the Federal agency's or pass-through entity's management decision,
the summary schedule shall provide an explanation.
(4)When the auditee believes the audit findings are no longer valid or do not warrant further action,
the reasons for this position shall be described in the summary schedule. A valid reason for
considering an audit finding as not warranting further action is that all of the following have
occurred:
(i)Two years have passed since the audit report in which the finding occurred was submitted to the
Federal clearinghouse;
(ii)The Federal agency or pass-through entity is not currently following up with the auditee on the
audit finding; and
(iii)A management decision was not issued.
(c)Corrective action plan. At the completion of the audit,the auditee shall prepare a corrective
action plan to address each audit finding included in the current year auditor's reports. The corrective
action plan shall provide the name(s)of the contact person(s)responsible for corrective action,the
corrective action planned, and the anticipated completion date. If the auditee does not agree with the
audit findings or believes corrective action is not required,then the corrective action plan shall
include an explanation and specific reasons.
§_.320 Report submission.
(a)General.The audit shall be completed and the data collection form described in paragraph(b)of
this section and reporting package described in paragraph(c)of this section shall be submitted within
the earlier of 30 days after receipt of the auditor's report(s),or nine months after the end of the audit
period,unless a longer period is agreed to in advance by the cognizant or oversight agency for audit.
(However, for fiscal years beginning on or before June 30, 1998,the audit shall be completed and the
data collection form and reporting package shall be submitted within the earlier of 30 days after
receipt of the auditor's report(s),or 13 months after the end of the audit period.)Unless restricted by
law or regulation,the auditee shall make copies available for public inspection.
(b)Data Collection. (1)The auditee shall submit a data collection form which states whether the
audit was completed in accordance with this part and provides information about the auditee,its
Federal programs, and the results of the audit. The form shall be approved by OMB,available from
the Federal clearinghouse designated by OMB, and include data elements similar to those presented
in this paragraph. A senior level representative of the auditee(e.g., State controller,director of
finance,chief executive officer,or chief financial officer) shall sign a statement to be included as part
of the form certifying that: the auditee complied with the requirements of this part,the form was
ye g
prepared in accordance with this part(and the instructions accompanying the form), and the
information included in the form, in its entirety, are accurate and complete.
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(2)The data collection form shall include the following data elements:
(i)The type of report the auditor issued on the financial statements of the auditee(i.e., unqualified
opinion,qualified opinion, adverse opinion,or disclaimer of opinion).
(ii)Where applicable, a statement that reportable conditions in internal control were disclosed by the
audit of the financial statements and whether any such conditions were material weaknesses.
(iii)A statement as to whether the audit disclosed any noncompliance which is material to the
financial statements of the auditee.
(iv)Where applicable,a statement that reportable conditions in internal control over major programs
were disclosed by the audit and whether any such conditions were material weaknesses.
(v)The type of report the auditor issued on compliance for major programs(i.e.,unqualified opinion,
qualified opinion, adverse opinion,or disclaimer of opinion).
(vi)A list of the Federal awarding agencies which will receive a copy of the reporting package
pursuant to § .320(d)(2)of OMB Circular A-133.
(vii)A yes or no statement as to whether the auditee qualified as a low-risk auditee under§_.530 of
OMB Circular A-I33.
(viii)The dollar threshold used to distinguish between Type A and Type B programs as defined in
§ .520(b)of OMB Circular A-133.
(ix)The Catalog of Federal Domestic Assistance(CFDA)number for each Federal program,as
applicable.
(x)The name of each Federal program and identification of each major program. Individual programs
within a cluster of programs should be listed in the same level of detail as they are listed in the
schedule of expenditures of Federal awards.
(xi) The amount of expenditures in,the schedule of expenditures of Federal awards associated with
each Federal program.
(xii)For each Federal program, a yes or no statement as to whether there are audit,findings in each of
the following types of compliance requirements and the total amount of any questioned costs:
(A)Activities allowed or unallowed.
(B)Allowable costs/cost principles.
(C)Cash management.
(D)Davis-Bacon Act.
(E) Eligibility.
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(F)Equipment and real property management.
(G)Matching,level of effort, earmarking.
(H)Period of availability of Federal funds.
(I)Procurement and suspension and debarment.
(J)Program income.
(K)Real property acquisition and relocation assistance.
(L)Reporting.
(M)Subrecipient monitoring.
(N)Special tests and provisions.
(xiii)Auditee Name,Employer Identification Number(s),Name and Title of Certifying Official,
Telephone Number, Signature, and Date.
(xiv)Auditor Name,Name and Title of Contact Person,Auditor Address,Auditor Telephone
Number, Signature,and Date.
(xv)Whether the auditee has either a cognizant or oversight agency for audit.
(xvi)The name of the cognizant or oversight agency for audit determined in accordance with
§ .400(a)and§_.400(b),respectively.
(3)Using the information included in the reporting package described in paragraph(c)of this section,
the auditor shall complete the applicable sections of the form. The auditor shall sign a statement to be
included as part of the data collection form that indicates, at a minimum,the source of the
information included in the form,the auditor's responsibility for the information,that the form is not
a substitute for the reporting package described in paragraph(c)of this section,and that the content
of the form is limited to the data elements prescribed by OMB.
(c)Reporting package. The reporting package shall include the:
(1)Financial statements and schedule of expenditures of Federal awards discussed in§ .310(a)
and§ .310(b),respectively;
(2) Summary schedule of prior audit findings discussed in §_.315(b);
sdiscussed in .505• and
(3)Auditor's report(s) § ,
P O —
(4)Corrective action plan discussed in§ .315(c).
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(d)Submission to clearinghouse. All auditees shall submit to the Federal clearinghouse designated
by OMB the data collection form described in paragraph(b)of this section and one copy of the
reporting package described in paragraph(c)of this section for:
(1)The Federal clearinghouse to retain as an archival copy; and
(2)Each Federal awarding agency when the schedule of findings and questioned costs disclosed audit
findings relating to Federal awards that the Federal awarding agency provided directly or the
summary schedule of prior audit findings reported the status of any audit findings relating to Federal
awards that the Federal awarding agency provided directly.
(e)Additional submission by subrecipients. (1)In addition to the requirements discussed in
paragraph(d)of this section, auditees that are also subrecipients shall submit to each pass-through
entity one copy of the reporting package described in paragraph(c)of this section for each pass-
through entity when the schedule of findings and questioned costs disclosed audit findings relating to
Federal awards that the pass-through entity provided or the summary schedule of prior audit findings
reported the status of any audit findings relating to Federal awards that the pass-through entity
provided.
(2)Instead of submitting the reporting package to a pass-through entity,when a subrecipient is not
required to submit a reporting package to a pass-through entity pursuant to paragraph(e)(1)of this
section,the subrecipient shall provide written notification to the pass-through entity that: an audit of
the subrecipient was conducted in accordance with this part(including the period covered by the audit
and the name, amount,and CFDA number of the Federal award(s)provided by the pass-through
entity); the schedule of findings and questioned costs disclosed no audit findings relating to the
Federal award(s)that the pass-through entity provided;and, the summary schedule of prior audit
findings did not report on the status of any audit findings relating to the Federal award(s)that the
pass-through entity provided. A subrecipient may submit a copy of the reporting package described in
paragraph(c)of this section to a pass-through entity to comply with this notification requirement.
(f)Requests for report copies. In response to requests by a Federal agency or pass-through entity,
auditees shall submit the appropriate copies of the reporting package described in paragraph(c)of
this section and, if requested,a copy of any management letters issued by the auditor.
(g)Report retention requirements. Auditees shall keep one copy of the data collection form
described in paragraph(b)of this section and one copy of the reporting package described in
paragraph(c)of this section on file for three years from the date of submission to the Federal
clearinghouse designated by OMB. Pass-through entities shall keep subrecipients'submissions on file
for three years from date of receipt.
(h)Clearinghouse responsibilities. The Federal clearinghouse designated by OMB shall distribute
the reporting packages received in accordance with paragraph(d)(2)of this section and§_.235(c)
(3)to applicable Federal awarding agencies,maintain a data base of completed audits,provide
appropriate information to Federal agencies,and follow up with known auditees which have not
submitted the required data collection forms and reporting packages.
(i)Clearinghouse address. The address of the Federal clearinghouse currently designated by OMB is
Federal Audit Clearinghouse, Bureau of the Census, 1201 E. 10th Street,Jeffersonville,IN 47132.
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(j)Electronic filing.Nothing in this part shall preclude electronic submissions to the Federal
clearinghouse in such manner as may be approved by OMB. With OMB approval, the Federal
clearinghouse may pilot test methods of electronic submissions.
Subpart D—Federal Agencies and Pass-Through Entities
§`.400 Responsibilities.
(a)Cognizant agency for audit responsibilities. Recipients expending more than$25 million a year
in Federal awards shall have a cognizant agency for audit. The designated cognizant agency for audit
shall be the Federal awarding agency that provides the predominant amount of direct funding to a
recipient unless OMB makes a specific cognizant agency for audit assignment.To provide for
continuity of cognizance,the determination of the predominant amount of direct funding shall be
based upon direct Federal awards expended in the recipient's fiscal years ending in 1995,2000,2005,
and every fifth year thereafter. For example,audit cognizance for periods ending in 1997 through
2000 will be determined based on Federal awards expended in 1995. (However, for States and local
governments that expend more than$25 million a year in Federal awards and have previously
assigned cognizant agencies for audit,the requirements of this paragraph are not effective until fiscal
years beginning after June 30, 2000.)Notwithstanding the manner in which audit cognizance is
determined,a Federal awarding agency with cognizance for an auditee may reassign cognizance to
another Federal awarding agency which provides substantial direct funding and agrees to be the
cognizant agency for audit. Within 30 days after any reassignment,both the old and the new
cognizant agency for audit shall notify the auditee,and,if known,the auditor of the reassignment.
The cognizant agency for audit shall:
(1)Provide technical audit advice and liaison to auditees and auditors.
(2)Consider auditee requests for extensions to the report submission due date required by§ .320
(a). The cognizant agency for audit may grant extensions for good cause.
(3)Obtain or conduct quality control reviews of selected audits made by non-Federal auditors,and
provide the results,when appropriate,to other interested organizations.
(4)Promptly inform other affected Federal agencies and appropriate Federal law enforcement
officials of any direct reporting by the auditee or its auditor of irregularities or illegal acts,as required
by GAGAS or laws and regulations.
(5)Advise the auditor and,where appropriate,the auditee of any deficiencies found in the audits
when the deficiencies require corrective action by the auditor. When advised of deficiencies,the
auditee shall work with the auditor to take corrective action. If corrective action is not taken,the
cognizant agency for audit shall notify the auditor,the auditee, and applicable Federal awarding
agencies and pass-through entities of the facts and make recommendations for follow-up action.
Major inadequacies or repetitive substandard performance by auditors shall be referred to appropriate
State licensing agencies and professional bodies for disciplinary action.
(6)Coordinate,to the extent practical,audits or reviews made by or for Federal agencies that are in
addition to the audits made pursuant to this part, so that the additional audits or reviews build upon
audits performed in accordance with this part.
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(7)Coordinate a management decision for audit findings that affect the Federal programs of more
than one agency.
(8)Coordinate the audit work and reporting responsibilities among auditors to achieve the most cost-
effective audit.
(9)For biennial audits permitted under§ .220,consider auditee requests to qualify as a low-risk
auditee under§_.530(a).
(b)Oversight agency for audit responsibilities. An auditee which does not have a designated
cognizant agency for audit will be under the general oversight of the Federal agency determined in
accordance with§_.105. The oversight agency for audit:
(1) Shall provide technical advice to auditees and auditors as requested.
(2)May assume all or some of the responsibilities normally performed by a cognizant agency for
audit.
(c) Federal awarding agency responsibilities. The Federal awarding agency shall perform the
following for the Federal awards it makes:
(1)Identify Federal awards made by informing each recipient of the CFDA title and number, award
name and number, award year, and if the award is for R&D. When some of this information is not
available,the Federal agency shall provide information necessary to clearly describe the Federal
award.
(2)Advise recipients of requirements imposed on them by Federal laws,regulations, and the
provisions of contracts or grant agreements.
(3)Ensure that audits are completed and reports are received in a timely manner and in accordance
with the requirements of this part.
(4)Provide technical advice and counsel to auditees and auditors as requested.
(5)Issue a management decision on audit findings within six months after receipt of the audit report
and ensure that the recipient takes appropriate and timely corrective action.
(6)Assign a person responsible for providing annual updates of the compliance supplement to OMB.
(d)Pass-through entity responsibilities. A pass-through entity shall perform the following for the
Federal awards it makes:
(1) Identify Federal awards made by informing each subrecipient of CFDA title and number, award
name and number, award year, if the award is R&D, and name of Federal agency. When some of this
information is not available, the pass-through entity shall provide the best information available to
describe the Federal award.
(2)Advise subrecipients of requirements imposed on them by Federal laws, regulations,and the
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provisions of contracts or grant agreements as well as any supplemental requirements imposed by the
pass-through entity.
(3)Monitor the activities of subrecipients as necessary to ensure that Federal awards are used for
authorized purposes in compliance with laws,regulations, and the provisions of contracts or grant
agreements and that performance goals are achieved.
(4) Ensure that subrecipients expending$300,000 or more in Federal awards during the subrecipient's
fiscal year have met the audit requirements of this part for that fiscal year.
(5)Issue a management decision on audit findings within six months after receipt of the
subrecipient's audit report and ensure that the subrecipient takes appropriate and timely corrective
action.
(6)Consider whether subrecipient audits necessitate adjustment of the pass-through entity's own
records.
(7)Require each subrecipient to permit the pass-through entity and auditors to have access to the
records and financial statements as necessary for the pass-through entity to comply with this part.
§ .405 Management decision.
(a)General. The management decision shall clearly state whether or not the audit finding is
sustained,the reasons for the decision, and the expected auditee action to repay disallowed costs,
make financial adjustments,or take other action. If the auditee has not completed corrective action, a
timetable for follow-up should be given. Prior to issuing the management decision,the Federal
agency or pass-through entity may request
additional information or documentation from the auditee, including a request for auditor assurance
related to the documentation,as a way of mitigating disallowed costs. The management decision
should describe any appeal process available to the auditee.
(b)Federal agency. As provided in§l.400(a)(7),the cognizant agency for audit shall be
responsible for coordinating a management decision for audit findings that affect the programs of
more than one Federal agency. As provided in § .400(c)(5), a Federal awarding agency is
responsible for issuing a management decision for findings that relate to Federal awards it makes to
recipients. Alternate arrangements may be made on a case-by-case basis by agreement among the
Federal agencies concerned.
(c) Pass-through entity. As provided in§ .400(d)(5),the pass-through entity shall be responsible
for making the management decision for audit findings that relate to Federal awards it makes to
subrecipients.
(d)Time requirements.The entity responsible for making the management decision shall do so
within six months of receipt of the audit report. Corrective action should be initiated within six
months after receipt of the audit report and proceed as rapidly as possible.
(e)Reference numbers. Management decisions shall include the reference numbers the auditor
assigned to each audit finding in accordance with§_.510(c).
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Subpart E—Auditors
§_ .500 Scope of audit.
(a)General. The audit shall be conducted in accordance with GAGAS. The audit shall cover the
entire operations of the auditee; or, at the option of the auditee, such audit shall include a series of
audits that cover departments, agencies,and other organizational units which expended or otherwise
administered Federal awards during such fiscal year, provided that each such audit shall encompass
the financial statements and schedule of expenditures of Federal awards for each such department,
agency, and other organizational unit,which shall be considered to be a non-Federal entity. The
financial statements and schedule of expenditures of Federal awards shall be for the same fiscal year.
(b) Financial statements. The auditor shall determine whether the financial statements of the auditee
are presented fairly in all material respects in conformity with generally accepted accounting
principles. The auditor shall also determine whether the schedule of expenditures of Federal awards is
presented fairly in all material respects in relation to the auditee's financial statements taken as a
whole.
(c)Internal control. (1)In addition to the requirements of GAGAS,the auditor shall perform
procedures to obtain an understanding of internal control over Federal programs sufficient to plan the
audit to support a low assessed level of control risk for major programs.
(2)Except as provided in paragraph(c)(3)of this section,the auditor shall:
(i)Plan the testing of internal control over major programs to support a low assessed level of control
risk for the assertions relevant to the compliance requirements for each major program; and
(ii)Perform testing of internal control as planned in paragraph(c)(2)(i)of this section.
(3) When internal control over some or all of the compliance requirements for a major program are
likely to be ineffective in preventing or detecting noncompliance,the planning and performing of
testing described in paragraph(c)(2)of this section are not required for those compliance
requirements. However,the auditor shall report a reportable condition(including whether any such
condition is a material weakness)in accordance with§ .5I0, assess the related control risk at the
maximum, and consider whether additional compliance tests are required because of ineffective
internal control.
(d)Compliance. (1) In addition to the requirements of GAGAS,the auditor shall determine whether
the auditee has complied with laws,regulations, and the provisions of contracts or grant agreements
that may have a direct and material effect on each of its major programs.
(2)The principal compliance requirements applicable to most Federal programs and the compliance
requirements of the largest Federal programs are included in the compliance supplement.
(3)For the compliance requirements related to Federal programs contained in the compliance
supplement, an audit of these compliance requirements will meet the requirements of this part. Where
there have been changes to the compliance requirements and the changes are not reflected in the
compliance supplement, the auditor shall determine the current compliance requirements and modify
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the audit procedures accordingly. For those Federal programs not covered in the compliance
supplement,the auditor should use the types of compliance requirements contained in the compliance
supplement as guidance for identifying the types of compliance requirements to test,and determine
the requirements governing the Federal program by reviewing the provisions of contracts and grant
agreements and the laws and regulations referred to in such contracts and grant agreements.
(4)The compliance testing shall include tests of transactions and such other auditing procedures
necessary to provide the auditor sufficient evidence to support an opinion on compliance.
(e)Audit follow-up. The auditor shall follow-up on prior audit findings,perform procedures to
assess the reasonableness of the summary schedule of prior audit findings prepared by the auditee in
accordance with§ .315(b), and report,as a current year audit finding,when the auditor concludes
that the summary schedule of prior audit findings materially misrepresents the status of any prior
audit finding. The auditor shall perform audit follow-up procedures regardless of whether a prior
audit finding relates to a major program in the current year.
(f)Data Collection Form. As required in§_.320(b)(3),the auditor shall complete and sign
specified sections of the data collection form.
§r.505 Audit reporting.
The auditor's report(s)may be in the form of either combined or separate reports and may be
organized differently from the manner presented in this section. The auditor's report(s)shall state that
the audit was conducted in accordance with this part and include the following:
(a)An opinion(or disclaimer of opinion)as to whether the financial statements are presented fairly in
all material respects in conformity with generally accepted accounting principles and an opinion(or
disclaimer of opinion)as to whether the schedule of expenditures of Federal awards is presented
fairly in all material respects in relation to the financial statements taken as a whole.
(b)A report on internal control related to the financial statements and major programs. This report
shall describe the scope of testing of internal control and the results of the tests, and,where
applicable,refer to the separate schedule of findings and questioned costs described in paragraph(d)
of this section.
(c)A report on compliance with laws,regulations,and the provisions of contracts or grant
agreements,noncompliance with which could have a material effect on the financial statements. This
report shall also include an opinion(or disclaimer of opinion)as to whether the auditee complied
with laws,regulations,and the provisions of contracts or grant agreements which could have a direct
and material effect on each major program, and,where applicable,refer to the separate schedule of
findings and questioned costs described in paragraph(d)of this section.
(d) A schedule of findings and questioned costs which shall include the following three components:
(1)A summary of the auditor's results which shall include:
(i)The type of report the auditor issued on the financial statements of the auditee(i.e.,unqualified
opinion,qualified opinion,adverse opinion,or disclaimer of opinion);
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(ii)Where applicable,a statement that reportable conditions in internal control were disclosed by the
audit of the financial statements and whether any such conditions were material weaknesses;
(iii)A statement as to whether the audit disclosed any noncompliance which is material to the
financial statements of the auditee;
(iv)Where applicable, a statement that reportable conditions in internal control over major programs
were disclosed by the audit and whether any such conditions were material weaknesses;
(v)The type of report the auditor issued on compliance for major programs(i.e., unqualified opinion,
qualified opinion, adverse opinion,or disclaimer of opinion);
(vi)A statement as to whether the audit disclosed any audit findings which the auditor is required to
report under§ .510(a);
(vii)An identification of major programs;
(viii)The dollar threshold used to distinguish between Type A and Type B programs,as described in
§ .520(b); and
(ix)A statement as to whether the auditee qualified as a low-risk auditee under§ .530.
(2)Findings relating to the financial statements which are required to be reported in accordance with
GAGAS..
(3)Findings and questioned costs for Federal awards which shall include audit findings as defined in
§_.510(a).
(i)Audit findings(e.g., internal control findings, compliance findings,questioned costs,or fraud)
which relate to the same issue should be presented as a single audit finding. Where practical,audit
findings should be organized by Federal agency or pass-through entity.
(ii)Audit findings which relate to both the financial statements and Federal awards, as reported under
paragraphs(d)(2)and(d)(3)of this section,respectively,should be reported in both sections of the
schedule. However, the reporting in one section of the schedule may be in summary form with a
reference to a detailed reporting in the other section of the schedule.
§_.510 Audit findings.
(a)Audit findings reported. The auditor shall report the following as audit findings in a schedule of
findings and questioned costs:
(1)Reportable conditions in internal control over major programs. The auditor's determination of
whether a deficiency in internal control is a reportable condition for the purpose of reporting an audit
finding is in relation to a type of compliance requirement for a major program or an audit objective
identified in the compliance supplement. The auditor shall identify reportable conditions which are
individually or cumulatively material weaknesses.
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(2)Material noncompliance with the provisions of laws,regulations,contracts,or grant agreements
related to a major program. The auditor's determination of whether a noncompliance with the
provisions of laws,regulations,contracts,or grant agreements is material for the purpose of reporting
an audit finding is in relation to a type of compliance requirement for a major program or an audit
objective identified in the compliance supplement.
(3)Known questioned costs which are greater than$10,000 for a type of compliance requirement for
a major program. Known questioned costs are those specifically identified by the auditor. In
evaluating the effect of questioned costs on the opinion on compliance, the auditor considers the best
estimate of total costs questioned(likely questioned costs),not just the questioned costs specifically
identified(known questioned costs). The auditor shall also report known questioned costs when
likely questioned costs are greater than$10,000 for a type of compliance requirement for a major
program. In reporting questioned costs,the auditor shall include information to provide proper
perspective for judging the prevalence and consequences of the questioned costs.
(4)Known questioned costs which are greater than$10,000 for a Federal program which is not
audited as a major program. Except for audit follow-up,the auditor is not required under this part to
perform audit procedures for such a Federal program;therefore,the auditor will normally not find
questioned costs for a program which is not audited as a major program. However, if the auditor does
become aware of questioned costs for a Federal program which is not audited as a major program
(e.g.,as part of audit follow-up or other audit procedures)and the known questioned costs are greater
than$10,000,then the auditor shall report this as an audit finding.
(5)The circumstances concerning why the auditor's report on compliance for major programs is other
than an unqualified opinion,unless such circumstances are otherwise reported as audit findings in the
schedule of findings and questioned costs for Federal awards.
(6)Known fraud affecting a Federal award, unless such fraud is otherwise reported as an audit
finding in the schedule of findings and questioned costs for Federal awards. This paragraph does not
require the auditor to make an additional reporting when the auditor confirms that the fraud was
repor
ted outside of the auditor's reports under the direct reporting requirements of GAGAS.
(7)Instances where the results of audit follow-up procedures disclosed that the summary schedule of
prior audit findings prepared by the auditee in accordance with§_.315(b)materially misrepresents
the status of any prior audit finding.
(b)Audit finding detail. Audit findings shall be presented in sufficient detail for the auditee to
prepare a corrective action plan and take corrective action and for Federal agencies and pass-through
entities to arrive at a management decision. The following specific information shall be included, as
applicable,in audit findings:
(1)Federal program and specific Federal award identification including the CFDA title and number,
Federal award number and year,name of Federal agency, and name of the applicable pass-through
entity. When information, such as the CFDA title and number or Federal award number, is not
available,the auditor shall provide the best information available to describe the Federal award.
(2)The criteria or specific requirement upon which the audit finding is based,including statutory,
regulatory,or other citation.
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(3)The condition found,including facts that support the deficiency identified in the audit finding.
(4)Identification of questioned costs and how they were computed.
(5)Information to provide proper perspective for judging the prevalence and consequences of the
audit findings,such as whether the audit findings represent an isolated instance or a systemic
problem. Where appropriate, instances identified shall be related to the universe and the number of
cases examined and be quantified in terms of dollar value.
(6)The possible asserted effect to provide sufficient information to the auditee and Federal agency,or
pass-through entity in the case of a subrecipient, to permit them to determine the cause and effect to
facilitate prompt and proper corrective action.
(7)Recommendations to prevent future occurrences of the deficiency identified in the audit finding.
(8)Views of responsible officials of the auditee when there is disagreement with the audit findings,to
the extent practical.
(c)Reference numbers. Each audit finding in the schedule of findings and questioned costs shall
include a reference number to allow for easy referencing of the audit findings during follow-up.
§ .515 Audit working papers.
(a)Retention of working papers. The auditor shall retain working papers and reports for a minimum
of three years after the date of issuance of.the auditor's report(s)to the auditee,unless the auditor is
notified in writing by the cognizant agency for audit,oversight agency for audit,or pass-through
entity to extend the retention period. When the auditor is aware that the Federal awarding agency,
pass-through entity,or auditee is contesting an audit finding,the auditor shall contact the parties
contesting the audit finding for guidance prior to destruction of the working papers and reports.
(b)Access to working papers. Audit working papers shall be made available upon request to the
cognizant or oversight agency for audit or its designee,a Federal agency providing direct or indirect
funding,or GAO at the completion of the audit, as part of a quality review,to resolve audit findings,
or to carry out oversight responsibilities consistent with the purposes of this part. Access to working
papers includes the right of Federal agencies to obtain copies of working papers,as is reasonable and
necessary.
§ .520 Major program determination.
(a)General. The auditor shall use a risk-based approach to determine which Federal programs are
major programs. This risk-based approach shall include consideration of: Current and prior audit
experience,oversight by Federal agencies and pass-through entities, and the inherent risk of the
Federal program. The process in paragraphs(b)through(i)of this section shall be followed.
(b)Step 1. (1) The auditor shall identify the larger Federal programs,which shall be labeled Type A
programs. Type A programs are defined as Federal programs with Federal awards expended during
the audit period exceeding the larger of:
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(i)$300,000 or three percent(.03)of total Federal awards expended in the case of an auditee for
which total Federal awards expended equal or exceed$300,000 but are less than or equal to $100
million.
(ii)$3 million or three-tenths of one percent(.003)of total Federal awards expended in the case of an
auditee for which total Federal awards expended exceed$100 million but are less than or equal to
$10 billion.
(iii)$30 million or 15 hundredths of one percent(.0015)of total Federal awards expended in the case
of an auditee for which total Federal awards expended exceed$10 billion.
(2)Federal programs not labeled.Type A under paragraph(b)(1)of this section shall be labeled Type
B programs.
(3)The inclusion of large loan and loan guarantees(loans)should not result in the exclusion of other
programs as Type A programs. When a Federal program providing loans significantly affects the
number or size of Type A programs,the auditor shall consider this Federal program as a Type A
program and exclude its values in determining other Type A programs.
(4)For biennial audits permitted under§ .220,the determination of Type A and Type B programs
shall be based upon the Federal awards expended during the two-year period.
(c)Step 2. (1)The auditor shall identify Type A programs which are low-risk. For a Type A program
to be considered low-risk, it shall have been audited as a major program in at least one of the two
most recent audit periods(in the most recent audit period in the case of a biennial audit), and,in the
most recent audit period, it shall have had no audit findings under§ .510(a). However, the auditor
may use judgment and consider that audit findings from questioned costs under§ .510(a)(3)and
§_.510(a)(4), fraud under§ .510(a)(6),and audit follow-up for the summary schedule of prior
audit findings under§ .510(a)(7)do not preclude the Type A program from being low-risk. The
auditor shall consider: the criteria in§i_.525(c), § .525(d)(1), §_.525(d)(2),and§ .525(d)
(3); the results of audit follow-up; whether any changes in personnel or systems affecting a Type A
program have significantly increased risk; and apply professional judgment in determining whether a
Type A program is low-risk.
(2)Notwithstanding paragraph(c)(1)of this section,OMB may approve a Federal awarding agency's
request that a Type A program at certain recipients may not be considered low-risk. For example, it
may be necessary for a large Type A program to be audited as major each year at particular recipients
to allow the Federal agency to comply with the Government Management Reform Act of 1994(31
U.S.C. 3515). The Federal agency shall notify the recipient and,if known,the auditor at least 180
days prior to the end of the fiscal year to be audited of OMB's approval.
(d)Step 3. (1)The auditor shall identify Type B programs which are high-risk using professional
judgment and the criteria in§ .525. However,should the auditor select Option 2 under Step 4
(paragraph(e)(2)(i)(B)of this section), the auditor is not required to identify more high-risk Type B
programs than the number of low-risk Type A programs. Except for known reportable conditions in
internal control or compliance problems as discussed in§ .525(b)(1),§_.525(b)(2), and
§_.525(c)(1),a single criteria in§_.525 would seldom cause a Type B program to be considered
high-risk.
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(2)The auditor is not expected to perform risk assessments on relatively small Federal programs.
Therefore,the auditor is only required to perform risk assessments on Type B programs that exceed
the larger of:
(i)$100,000 or three-tenths of one percent(.003)of total Federal awards expended when the auditee
has less than or equal to$100 million in total Federal awards expended.
(ii)$300,000 or three-hundredths of one percent(.0003)of total Federal awards expended when the
auditee has more than$100 million in total Federal awards expended.
(e)Step 4. At a minimum,the auditor shall audit all of the following as major programs:
(1) All Type A programs,except the auditor may exclude any Type A programs identified as low-risk
under Step 2 (paragraph(c)(1)of this section).
(2)(i)High-risk Type B programs as identified under either of the following two options:
(A)Option 1. At least one half of the Type B programs identified as high-risk under Step 3
(paragraph(d)of this section), except this paragraph(e)(2)(i)(A)does not require the auditor to audit
more high-risk Type B programs than the number of low-risk Type A programs identified as low-risk
under Step 2.
(B) Option 2. One high-risk Type B program for each Type A program identified as low-risk under
Step 2.
(ii)When identifying which high-risk Type B programs to audit as major under either Option 1 or 2
in paragraph(e)(2)(i)(A)or(B), the auditor is encouraged to use an approach which provides an
opportunity for different high-risk Type B programs to be audited as major over a period of time.
(3) Such additional programs as may be necessary to comply with the percentage of coverage rule
discussed in paragraph(f)of this section. This paragraph(e)(3)may require the auditor to audit more
programs as major than the number of Type A programs.
(f) Percentage of coverage rule. The auditor shall audit as major programs Federal programs with
Federal awards expended that, in the aggregate,encompass at least 50 percent of total Federal awards
expended. If the auditee meets the criteria in§ .530 for a low-risk auditee, the auditor need only
audit as major programs Federal programs with Federal awards expended that, in the aggregate,
encompass at least 25 percent of total Federal awards expended.
(g)Documentation of risk. The auditor shall document in the working papers the risk analysis
process used in determining major programs.
(h)Auditor's judgment. When the major program determination was performed and documented in
accordance with this part,the auditor's judgment in applying the risk-based approach to determine
major programs shall be presumed correct. Challenges by Federal agencies and pass-through entities
shall only be for clearly improper use of the guidance in this part. However, Federal agencies and
pass-through entities may provide auditors guidance about the risk of a particular Federal program
and the auditor shall consider this guidance in determining major programs in audits not yet
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•
completed.
(i)Deviation from use of risk criteria. For first-year audits, the auditor may elect to determine
major programs as all Type A programs plus any Type B programs as necessary to meet the
percentage of coverage rule discussed in paragraph(f)of this section. Under this option,the auditor
would not be required to perform the procedures discussed in paragraphs(c),(d),and(e) of this
section.
(1)A first-year audit is the first year the entity is audited under this part or the first year of a change
of auditors.
(2)To ensure that a frequent change of auditors would not preclude audit of high-risk Type B
programs,this election for first-year audits may not be used by an auditee more than once in every
three years.
§_.525 Criteria for Federal program risk.
(a)General. The auditor's determination should be based on an overall evaluation of the risk of
noncompliance occurring which could be material to the Federal program. The auditor shall use
auditor judgment and consider criteria, such as described in paragraphs(b),(c),and(d)of this
section,to identify risk in Federal programs. Also,as part of the risk analysis,the auditor may wish to - -
discuss a particular Federal program with auditee management and the Federal agency or pass-
through entity.
(b)Current and prior audit experience. (1)Weaknesses in internal control over Federal programs
would indicate higher risk. Consideration should be given to the control environment over Federal
programs and such factors as the expectation of management's adherence to applicable laws and
regulations and the provisions of contracts and grant agreements and the competence and experience
of personnel who administer the Federal programs.
(i)A Federal program administered under multiple internal control structures may have higher risk.
When assessing risk in a large single audit,the auditor shall consider whether weaknesses are isolated
in a single operating unit(e.g.,one college campus)or pervasive throughout the entity.
(ii)When significant parts of a Federal program are passed through to subrecipients, a weak system
i
for monitoring subrecipients would indicate higher risk.
(iii)The extent to which computer processing is used to administer Federal programs,as well as the
complexity of that processing, should be considered by the auditor in assessing risk.New and
recently modifiedcomputersystemsalso indicate risk.
may
(2)Prior audit findings would indicate higher risk,particularly when the situations identified in the
audit findings could have a significant impact on a Federal program or have not been corrected.
(3)Federal programs not recently audited as major programs may be of higher risk than Federal
programs recently audited as major programs without audit findings.
(c)Oversight exercised by Federal agencies and pass-through entities. (1)Oversight exercised by
Federal agencies or pass-through entities could indicate risk. For example,recent monitoring or other
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reviews performed by an oversight entity which disclosed no significant problems would indicate
lower risk. However,monitoring which disclosed significant problems would indicate higher risk.
(2)Federal agencies,with the concurrence of OMB,may identify Federal programs which are higher
risk. OMB plans to provide this identification in the compliance supplement.
(d)Inherent risk of the Federal program. (1)The nature of a Federal program may indicate risk.
Consideration should be given to the complexity of the program and the extent to which the Federal
program contracts for goods and services. For example, Federal programs that disburse funds through
third party contracts or have eligibility criteria may be of higher risk. Federal programs primarily
involving staff payroll costs may have a high-risk for time and effort reporting,but otherwise be at
low-risk.
(2)The phase of a Federal program in its life cycle at the Federal agency may indicate risk. For
example, a new Federal program with new or interim regulations may have higher risk than an
established program with time-tested regulations. Also, significant changes in Federal programs,
laws, regulations,or the provisions of contracts or grant agreements may increase risk.
(3)The phase of a Federal program in its life cycle at the auditee may indicate risk. For example,
during the first and last years that an auditee participates in a Federal program,the risk may be higher
due to start-up or closeout of program activities and staff.
(4)Type B programs with larger Federal awards expended would be of higher risk than programs
with substantially smaller Federal awards expended.
§_.530 Criteria for a low-risk auditee.
An auditee which meets all of the following conditions for each of the preceding two years(or,in the
case of biennial audits,preceding two audit periods)shall qualify as a low-risk auditee and be eligible
for reduced audit coverage in accordance with§i.520:
(a)Single audits were performed on an annual basis in accordance with the provisions of this part. A
non-Federal entity that has biennial audits does not qualify as a low-risk auditee,unless agreed to in
advance by the cognizant or oversight agency for audit.
(b)The auditor's opinions on the financial statements and the schedule of expenditures of Federal
awards were unqualified. However,the cognizant or oversight agency for audit may judge that an
opinion qualification does not affect the management of Federal awards and provide a waiver.
(c)There were no deficiencies in internal control which were identified as material weaknesses under
the requirements of GAGAS. However, the cognizant or oversight agency for audit may judge that
any identified material weaknesses do not affect the management of Federal awards and provide a
waiver.
(d)None of the Federal programs had audit findings from any of the following in either of the
preceding two years(or, in the case of biennial audits, preceding two audit periods)in which they
were classified as Type A programs:
(1)Internal control deficiencies which were identified as material weaknesses;
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•
OMB Circular No. A-133 Page 33 of 33
(2)Noncompliance with the provisions of laws,regulations,contracts,or grant agreements which
have a material effect on the Type A program;or(3)Known or likely questioned costs that exceed
five percent of the total Federal awards expended for a Type A program during the year.
Appendix A to Part_-Data Collection Form(Form SF-SAC)71(56KB)
Appendix B to Part—-Circular A-133 Compliance Supplement
Note: Provisional OMB Circular A-133 Compliance Supplement is available from the Office of
Administration,Publications Office,room 2200,New Executive Office Building, Washington,DC
20503.
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PLEASE COMPLETE THE ENTIRE FORM. Exhibit N
CITY OF OMAHA PLANNING DEPARTMENT
HOUSING AND COMMUNITY DEVELOPMENT
OCCUPANCY REPORT
A. GENERAL INFORMATION
Project Name
Borrower Name DOB SSN
Co-Borrower Name DOB SSN
Address
City Funds Requested $ Fund Source HOME ❑ CDBG ❑ NAHTF ❑
DEMOGRAPHICS &ANTICIPATED INCOME OF ALL HOUSEHOLD MEMBERS
Head of Household is: Male ❑ Female ❑ Elderly ❑
Number of Occupants: Total No. Adults No. Children Under 18
Please enter ethnicity and race for each household member. Below are the definitions.
Ethnicity—Choose either H or NH. Enter H for Hispanic or Latino. Enter NH for Not Hispanic or Latino
Race Categories—Choose all that apply for each household member. Enter one or more of the following abbreviations:
W,B, A, AI,PI
White(W)
Black or African American(B)
Asian(A)
American Indian or Alaska Native(AI)
Native Hawaiian or Other Pacific Islander(PI)
(H or Anticipated Anticipated
Name of Household Relationship NH) (see above) Monthly Annual
Member to Borrower Age Ethnicity Race Handicap Income Income
Borrower ***** $ $
Co-Borrower $ $
$ $
$ $
$ $
$ $
$ $
$ $
$ $
TOTAL $ $
100%MEDIAN FAMILY INCOME(MFI)FOR HH SIZE $
%HOUSEHOLD MEDIAN FAMILY INCOME
%BORROWER MEDIAN FAMILY INCOME
CENSUS TRACT
NUMBER OF BEDROOMS
Authorized Agency Representative Date
Computing Annual Income Form must be attached. 9-23-03
1
�.ME nifrp
�Qr L� °Z U.S. Department of Housing and Urban Development
* iJ * Nebraska State Office
II,IIIII Executive Tower Centre
' , DEVS�PQ 10909 Mill Valley Road
Omaha, Nebraska 68 1 54-39 55
February 19, 2003
Mr. James R. Thele •
City of Omaha
Omaha/Douglas Civic Center
1819 Farnam Street, Suite 1100
Omaha,NE 68183-0110
Dear Mr. Thele:
Please refer to your letter dated January 15, 2003, concerning a market analysis of an Omaha
neighborhood to be used to demonstrate the presumption of affordability as described in the HOME
regulations at 24 CFR 92.254(a)(5)(i.)(B). The city is required to use resale or recapture provisions to
ensure the continued affordability of housing it assists with HOME funds. However, the city may
presume that housing will meet the affordability requirements if a market analysis demonstrates that the
housing will remain affordable to a reasonable range of low-income homebuyers.
Below is the list of Census Tracts that comprise the proposed neighborhood as identified in the
market analysis:
Tract Tract Tract Tract
2.00 .11.00 57.00 61.02 •
3.00 12.00 58.00 62.02
4.00 . 52.00 59.01 63.01
6.00 53.00 59.02 63.02
7.00 54.00 60.00 63.03
8.00 55.00 61.01 -.
We have completed a review of the analysis provided. We agree that housing within the
neighborhood identified above should continue to be affordable to a reasonable range of low-income
homebuyers who reside in the area. As a result, the city will not be required to impose resale/recapture
restrictions on HOME-assisted, homeownership activities in the identified neighborhood.
The regulations at 92.254(a)(5)(i)(B) also require that the market analysis periodically be updated
to verify the original presumption of continued affordability. Therefore, the approval of the presumption
of atfordabiliry for this neighborhood will be effective until December 31, 2007, so as to run concurrently
2
with the city's current Consolidated Plan. At that time, an updated market analysis must be presented to
verify the presumption of affordability.
Should you have any questions, please call Mr. Tim Severin, Public Trust Specialist, at 492-3145.
Sincerely,
• •
,
. -
Gregory A. Bevirt
Director
Community Planning and
Development Division
•
HOME Program Presumption of Housing Affordability:
Market Analysis of Proposed Neighborhood
Assisting households acquire affordable housing is a permitted use of funds under the
HOME Investment Partnerships (HOME) Program regulations. Part 24 CFR 92.254
(Qualification as Affordable Housing: Homeownership) of the regulations specifies the
criteria under which housing is determined to be affordability to low-income families,
• thereby permitting the use of HOME funds to assist potential homeowners acquire
homes..
Paragraph (a) (5) of this section goes on to state that a participating jurisdiction must
impose either resale or recapture requirements designed to "ensure affordability over a
period of time determined by the total amount of HOME funds invested in that housing.
During this period, the housing is to be available and affordable to a reasonable range of
low-income homebuyers; a low-income homebuyer must occupy the housing as it's
principal residence; and the original owner must be afforded a fair return on investment."
An alternative to the use of the resale requirements to maintaining affordability is
described in paragraph (a)(5)(i)(B), which states "Certain housing may be presumed to
meet the resale restrictions during the period of affordability without the imposition of
enforcement mechanisms by the participating jurisdiction." Employing the presumption
of affordability requires that an analysis/evaluation be prepared, the focus of which is the
neighborhood in which the housing for which presumption of affordability resale
alternative is proposed.
•
The City of Omaha undertakes homeownership programs with HOME funds and has
identified a neighborhood where housing may be presumed to meet the HOME resale
restrictions during the period of affordability. (See Map 1) A description of the necessary
components of the market analysis, the methods used to obtain the data, and the
conclusions drawn from the analysis follow:
1) An evaluation of the location and characteristics of the housing and residents in
the neighborhood (e.g., sales prices, age and amenities of housing stock, incomes
of residents, percentage of owner-occupants) in relation to housing and incomes
in the housing market area.
Housing sales prices in the Study Area are considerably less than are sales
prices the Omaha Area.' Based on sales from June to August of this 2002,
the median value of the houses sold in the Omaha Area was $129,239,
compared to $68,000 for housing sold within the Study Area--a difference
of 47%. The difference for the first quartile, or the price at which 25% of
the houses sold for less, is even greater with first quartile price at $95,500
for the Omaha Market Area and $45,750 for the study area; a difference of
50%. Third quartile housing values, or the price at which 75% of the
houses sold for less was $188,014 for the Omaha Market Area and
S85,000 for the Study Area: again, a substantial difference at 55%.
Data provided by the Great Plains Realtors a Multiple.Listing Service.
1.
The proportion of owner-occupied housing is nearly identical at 60.4% for
the Study Area and 59.6% for Omaha. Factors that combine to indicate the
potential for expanding the number homeowners in an area are the percent
of single-family detached units within and the percent of those that are
currently owner-occupied. Seventy-nine percent of the housing units are
single-family detached within the Study Area, compared to 63% for the
Omaha Area. Of those single-family detached units, owners occupy 84%
of them in the Omaha Area, compared to only 69% for the Study Area.
The impact of rehabilitation activities to the housing stock within the
study area is preservation of housing units. Increased values from
rehabilitation are nominal.
•
2) An analysis of the current and projected incomes of neighborhood residents for an
average period of affordability for homebuyers in the neighborhood must support
the conclusion that a reasonable range of low-income families will continue to
qualify for mortgage financing.
Both current and projected incomes support the conclusion that a
reasonable range of low-income homeowners will continue to qualify for
• mortgage financing.
Current
The Median Family Income (MFI) for Omaha in 2002 was $64,400
according the 2002 HUD provided Income Limits. For this analysis, the
families of greatest concern, or targeted, are those between 65%, or
$42,120, and 80% or$51,840. The study area has 2,025 families within
this range of incomes. Of the houses sold within the study area from June
2002, to August 2002, 91% were affordable to families at 65% MFI, and
96% were affordable to families with 80% MFI. The overwhelming
majority of houses were affordable to the income-targeted families.
Projections
Deteiiilining the future affordability of housing within the Study Area -
requires projecting changes in family income and housing values. For the
purposes .of this analysis, changes in MFI are deternuned by using national
projections of annual wages adjusted for inflation. The Board of Trustees
2002 Annual Report to the Old-Age and Survivors Insurance and the
Federal Disability Insurance Trust Funds (OASDI) developed the base
projections used in this analysis.- The projections are then adjusted: based
on comparisons of wages from 1990 to 2000 within the Study Area, to
reflect more closely the change in income expected in the Study Area.
Table V.B].—Principal Economic Assumptions of THE 2002 ANNUAL REPORT OF THE BOARD OF
TRUSTEES OF THE FEDERAL OLD-ACE.4ND SURVIVORS INSURANCE AND THE FEDERAL
DISABILITY INSURANCE TRUST FUNDS. page 90.
.
terms without government assistance and housing will remain affordable at least
during the next five to seven years compared to other housing in the market area.'
According to the 2000 Census 2,025 families within the Study Area had
incomes of 65% to 80% of the area Median Family Income (MFI). The
percentage of housing that is affordable to those 2,025 families within the •
• Study Area compared to the percentage that is affordable to them within
the Omaha Area demonstrates how different and relatively modest the
housing values are within the Study Area compared to the Omaha Area. •
As the previous section revealed, a family at 65% of the Area MFI could
afford 91% of the houses sold in the Study Area from June to August of
2002. Those same families could afford only 44% of the houses sold in the
Omaha Area during the same period. For families with 80% of the MFI,
96% of the houses sold in the Study Area were affordable, versus 60% of
the houses in the Omaha Area.
For families at 65% MFI, affordability for houses in the Omaha Area
drops to 29% compared to 85% in the Study Area in the 2007 projection.
For families at 80% of the area MFI, affordability declines to 47% for
housing within the Omaha Area, and 93% for houses in the Study Area.
By 2010, for families at 65% of the area MFI, affordability of houses in
the Omaha Area is down'to 21%, compared to 77% for the houses within
the Study Area. Families at 80% of the area MFI will be able to afford
only 36% of the houses, compared to 88% within the Study Area in 2010.
4) "The participating jurisdiction is encouraging homeownership in the .
neighborhood by p 5homeownership roviding assistance and by making
improvements to the streets, sidewalks, and other public facilities and services."
The City of Omaha has developed a system through which it encourages
homeownership in the Study Area. The major components of the system
include lenders, housing developers (often CFIDOs) and the City of
Omaha. The City of Omaha includes not just the Housing and Community
Development Division but the Public Works Department, the Parks
Department, the finance Department as well as other functional areas of
the Planning Department.
Omaha 100, a consortium of 11 lenders, provides mortgage financing to
homebuyers targeted by the City's homeownership programs. The efforts
increase homeownership opportunities by using underwriting criteria and
homeownership preparedness training designed to assist tow-income
' :affordable housing prices were determined with the mortgage calculator located at the Ginnie Mae
,.vebsite ihttp:i/www.cinniemae.aov/vpthi2 preaual/intro Lluestions.htm) using the maximum allowance for
non-housing debt.
•
income families supports this reasonable presumption. In addition, while projections of
housing affordability, based on projections of housing values and household incomes, do
indicate a pattern of lesser affordability the longer the projection, by 2010 the housing is
still affordable to nearly 80% of the low-income households with 65% of the MFI for the
area. This high level of affordability occurs in spite of using factors for housing value
increases that very likely over project housing values and therefore reduce affordability.
The housing is modestly priced in the Study Area in comparison to the Omaha Market
and the households that reside in the Study Area have incomes considerably less than do
those of the Omaha Market. The housing within the Study Area itself is similar, though
somewhat more modest, to that of the Omaha Area. The age of the housing stock is also
similar in the two areas, though older in the Study Area.
The City efforts to encourage homeownership in the Study Area by funding housing
development and assisting low-income household become homebuyers will continue. The
City will also continue to support the rehabilitation of owner-occupied housing to save
the existing housing_ stock and the character of the neighborhoods in which they are
located. These rehabilitation efforts have had very little impact on housing prices.
Finally, the City has and will continue to make the Study Area more attractive to
potential homebuyers through infrastructure improvements, improvements to recreational
facilities and the development of economic opportunities as well as through the provision
of affordable homeownership opportunities. •
•
•
The tact that affordability declines the longer the projection is indicative of the need to conduct future
analyses of this nature using updated data and factors on which to base projections.
HOME Program Presumption of Housing Affordability:
Market Analysis of Proposed Neighborhood
Support Data
Address Date Sold Price 2007 2010 Percentile
46 4319 Fowler Ave. 6/14/02 $49,950 $63,450 $72,842 33.3%
47 2202 No. 39 St. 6/21/02 $50,000 $63,514 $72,915 34.1
48 2878 Redick Ave. 7/17/02 $51,900 $65,927 $75,686 34.8%
49 2740 Mary 8/12/02 $52,900 $67,198 $77,144 35.5%
50 6018 No. 39 St. 6/7/02 $54,950 $69,802 $80,133 36.2%
51 3303 No. 43 St. 7/25/02 $54,950 $69,802 $80,133 37.0%
52 5805 Spaulding 6/28/02 $58,500 $74,311 $85,310 37.7%
53 4551 Fort St. 7/15/02 $59,000 $74,946 $86,040 38.4%
54 3321 Martin Ave. 6/5/02 $60,000 $76,216 $87,498 39.1
55 6544 No. 34 St. 6/14/02 $60,000 $76,216 $87,498 39.9%
56 2917 Ellison 7/29/02 $60,000 $76,216 $87,498 40.6%
57 4402 Pratt St. 6/6/02 $60,500 $76,852 $88,227 41.3%
58 3185 Stone Ave. 6/28/02 $60,900 $77,360 $88,810 42.0%
59 4302 Grand Ave. 6/4/02 $61,500 $78,122 $89,685 42.8%
60 3111 No. 50 St. 6/7/02 $62,000 $78,757 $90,414 43,5%
61 5029 Binney St. 7/26/02 $65,000 $82,568 $94,789 44.2%
62 2716 No. 51 St. 6/20/02 $65,500 $83,203 $95,519 44.9%
63 2746 No. 49 St. 6/13/02 $66,500 $84,473 $96,977 45.7%
64 2895 Crown Point Ave. 7/9/02 $66,500 $84,473 $96,977 46.4%
65 3509 Martin Ave. 6/4/02 $67,000 $85,108 $97,706 47.1%
66 3511 No. 60 St. 6/20/02 $67,500 $85,744 $98,435 47.8%
67 2747 Iowa St. 6/14/02 $68,000 $86,379 $99,164 48.6%
68 2872 Mary St. • 6/25/02 $68,000 $86,379 $99,164 49.3%
69 3425 Sheffield St. 8/5/02 $68,000 `$86,379 $99,164 50.0%
70 7407 No. 34 St. 6/27/02 $68,500 $87,014 $99,893 50.7%
71 6322 Camden Ave. 6/19/02 $69,500 $88,284 $101,352 51.4%
72 5605 Manderson St. 7/13/02 $69,500 $88,284 $101,352 52.2%
73 3031 Huntington Ave. 6/21/02 $70,000 $88,919 $102,081 52.9%
74 4537 Burdette St. 6/26/02 $70,000 $88,919 $102,081 53.6%
75 3528 No. 59 St. 7/12/02 $71,000 $90,189 $103,539 54.3%
76 1815 No. 48 Ave. 6/28/02 $72,000 $91,460 $104,997 55.1%
77 5835 Corby St. 6/26/02 $72,500 $92,095 $105,727 55.8%
78 3119 No. 55 St. 7/26/02 $73,000 $92,730 $106,456 56.5%
79 3901 King St. 7/31/02 $73,300 $93,111 $106,893 57.2%
80 4521 Franklin 6/12/02 $74,500 $94,635 $108,643 58.0%
81 3152 Arcadia Ave. 7/26/02 $74,950 $95,207 $109,299 58.7%
82 5311 Northwest Dr. 6/21/02 $74,999 $95,269 $109,371 59.4%
83 3201 No. 60 St. 6/7/02 $76,000 $96,541 $110,831 60.1%
84 4511 Bedford Ave. 7/3/02 $76,950 $97,748 $112,216 60.9%
85 4622 No. 55 St. 6/28/02 $77,000 $97,811 $112,289 61.6%
86 2916 Fontenelle Blvd. 6/28/02 $77,000 $97,811 $112,289 62.3%
37 5825 Ruggles St. 7/26/02 $77,686 $98,683 $113,289 63.0%
88 3021 N Whitmore 8/8/02 $77,950 $99,018 $113,674 63.8%
89 7736 No. 38 St. 7/12/02 $79,000 S100,352 S115,206 64.5%
90 6316 Maple St. 7/1/02 S79,000 S100,352 $115,206 65.2%
91 6716 No. 34 St. 7/31/02 $79,500 $100,987 S115,935 65.9%
92 7417 Northridge Dr. 6/21/02 S79,950 3101,558 $116,591 66.7%
93 5825 Ohio St. 6/12/02 S80,000 $101,622 61 16,664 67.4%0
Sales in Omaha Area 6/1/02 to 8/30/02 and Est. Current 2007 2010
Projected Housing Values for 2007 and 2010 values Prjctn2,75 S49,086Prjctn Voile
� 67 533,660 542,757 2.6,°
68 S33,904 $43,067 S49,442 2.7%
Est.Current 2007 2010 69 S34,148 S43,377 $49,798 2.7%
Values Prjctn Prjctn %Ile 70 $34,392 S43,687 S50,154 2.8%
1 $10,385 $13,192 S15,144 0.0% 71 S34,636 $43,997 $50,510 2.8%
2 $10,770 $13,681 $15,706 0.1% 72 S34,880 $44,307 $50,865 2.8%
3 $11,155 $14,170 $16,267 0.1% 73 $35,124 $44,617 $51,221 2.9%
4 $11,540 $14,659 $16,829 0.2% 74 $35,368 $44,927 $51,577 2.99'0
5 $11,925 $15,148 $17,390 0.2% 75 $35,612 $45,237 $51,933 3.0%
6 $12,310 $15,637 $17,952 0.2% 76 $35,856 $45,547 $52,289 3.0%
7 $12,695 $16,126 $18,513 0.3% 77 $36,100 S45,857 $52,645 3.0%
8 S13,080 $16,615 $19,075 0.3% 78 $36,344 $46,167 $53,000 3.1%
9 $13,465 $17,104 $19,636 0.4% 79 $36,588 $46,477 $53,356 3.1°0
10 $13,850 $17,593 $20,197 0.4% 80 $36,832 $46,787 $53,712 3.2%
11 $14,235 $18,082 $20,759 0.4% 81 S37,076 $47,097 $54,068 3.2%
12 $14,620 $18,571 $21,320 0.5% 82 $37,320 $47,407 $54,424 3.2%
13 $15,005 $19,060 $21,882 0.5% 83 $37,564 $47,717 $54,779 3.3%
14 $15,390 $19,550 $22,443 0.6% 84 $37,808 S48,027 $55,135 3.3%
15 $15,775 $20,039 $23,005 0.6% 85 $38,052 $48,336 $55,491 3.4%
16 $16,160 $20,528 $23,566 0.6% 86 $38,296 $48,646 $55,847 3.4%
17 $16,545 $21,017 $24,128 0.7% 87 $38,540 $48,956 $56,203 3.4%
18 $16,930 $21,506 $24,689 0.7% 88 $38,784 $49,266 $56,559 3.5%
19 $17,315 $21,995 $25,250 0.7% 89 $39,028 $49,576 $56,914 3.5%
20 $17,700 $22,484 $25,812 0.8% 90 $39,272 $49,886 $57,270 3.6%
21 $18,085 S22,973 $26,373 0.8% 91 $39,516 $50,196 $57,626 3.6%
22 $18,470 $23,462 $26,935 0.9% 92 $39,760 $50,506 $57,982 3.6%
23 $18,855 $23,951 $27,496 0.9% 93 $40,004 $50,816 $58,338 3.7%
24 $19,240 $24,440 $28,058 0.9% 94 $40,223 $51,094 $58,557 3.7%
25 $19,625 $24,929 $28,619 1.0% 95 $40,446 $51,378 $58,982 3.7%
26 $20,010 $25,418 $29,181 1.0% 96 $40,669 $51,661 $59,308 3.8%
27 $20,395 $25,907 $29,742 1.1% 97 $40,892 $51,944 $59,633 3.8%
28 $20,780 $26,396 $30,303 1.1% 98 $41,115 $52,227 $59,958 3.9%
29 $21,165 $26,885 $30,865 1.1% 99 •$41,338 $52,511 $60,283 3.9%
30 $21,550 $27,374 $31,426 1.2% 100 $41,561 $52,794 $60,608 3.9%
31 $21,935 $27,863 $31,988 1.2% 101 $41,784 $53,077 $60,934 4.0%
32 $22,320 $28,353 $32,549 1.3% 102 $42,007 $53,360 $61,259 4.0%
33 $22,705 $28,842 $33,111 1.3% 103 $42,230 $53,644 $61,584 4.1%
34 $23,090 $29,331 $33,672 1.3% 104 $42,453 $53,927 $61,909 4.1%
•
35 $23,475 $29,820 $34,234 1.4% 105 $42,676 $54,210 $62,234 4.1%
36 $23,860 $30,309 $34,795 1.4% 106 $42,899 $54,494 $62,560 4.2%
37 $24,245 $30,798 $35,356 1.5% 107 $43,122 $54,777 $62,885 4.2%
38 $24,630 $31,287 $35,918 1.5% 108 $43,345 $55,060 $63,210 4.3%
39 $25,015 $31,776 $36,479 1.5% 109 $43,568 $55,343 $63,535 4.3%
40 $25,400 $32,265 $37,041 1.6% 110 $43,791 $55,627 $63,860 4.3%
41 $25,785 $32,754 $37,602 1.6% 111 $44,014 $55,910 $64,186 4.4%
42 $26,170 $33,243 $38,164 1.7% 112 $44,237 $56,193 $64,511 4.4%
43 $26,555 $33,732 $38,725 1.7% 113 $44,460 $56,476 $64,836 4.5%
44 $26,940 $34,221 $39,287 1.7% 114 $44,683 $56,760 $65,161 4.5%
45 $27,325 $34,710 $39,848 1.8% 115 $44,906 $57,043 $65,486 - 4.5%
46 $27,710 $35,199 $40,409 1.8% 116 $45,129 $57,326 $65,812 4.6%
47 $28,095 $35,688 $40,971 1.9% 117 $45,352 $57,609 $66,137 4.6%
48 $28,480 $36,177 $41,532 1.9% 118 $45,575 $57,893 $66,462 4.7%
49 $28,865 $36,666 $42,094 1.9% 119 $45,798 $58,176 $66,787 4.7%
50 $29,250 $37,156 $42,655 2.0% 120 $46,021 $58,459 $67,112 4.7%
51 $29,635 $37,645 $43,217 2.0% 121 $46,244 $58,743 $67,438 4.8%
52 $30,020 $38,134 $43,778 2.1°%° 122 $46,467 $59,026 $67,763 4.8%
53 $30,244 $38,418 S44,105 2.1% 123 $46,690 $59,309 $68,088 4.9%
54 $30,488 $38,728 $44,461 2.1% 124 S46,913 S59.592 $68,413 4.9%
55 $30,732 S39,038 $44,816 2.2% 125 S47,136 $59,876 S68,738 4.9%
56 $30,976 $39.348 $45,172 2.2% 126 547,359 S60,159 $69,064 5.0%
57 $31,220 $39,658 $45,528 2.2% 127 S47,582 $60,442 S69,389 5.0%
58 $31,464 539,968 545,884 2.3% 28 547,805 $60,725 $69,714 S.%
59 531,708 540,278 $46,240 2.3% 129 $48,028 S61,009 S70,039 5.1%
,30 531,952 $40,588 $46,596 2.4% 130 S48,251 S61,292 370,364 5.1%
31 S32,196 :540.898 546,951 2.4% 31 S48.474 $61,575 S70,690 5.2%
,32 532,440 `541,'208 .347,307 2.4% i32 i48,697 561,359 $71,015 5.2%
'3 532.684 :341,518 347,663 5°� 133 348,920 :362,i 42 $71.340 5.2%
i4 32,228 541,828 548.019 ^5% '.34 549,143 S62,425 S71,665 5.3%
5333,172 342,138 548.375 ".640 '35 :349,366 362,708 S71,990 5.3%
i6 533,416 342,447 548,730 _.6% 36 549,589 ' 62,992 S72.2,16 5.4%
• Est. Current 2007 2010 Est. Current 2007 2010
' Values Prjctn Prjctn %Ile Values Prjctn Prjctn %ile
277 S71,125 S90,348 S103,721 10.9% 347 $76,375 $97,017 $111,377 13.7%
278 $71,200 S90,444 $103,831 11.0% 348 $76,450 $97,112 $111,487 13.7%
279 S71,275 S90,539 $103,940 11.0% 349 $76,525 $97,208 $111,596 13.8%
280 $71,350 $90,634 $104,050 11.0% 350 $76,600 $97,303 $111,706 13.8%
281 S71,425 S90,729 $104,159 11.1% 351 S76,675 $97,398 $111,815 13.9%
282 $71,500 $90,825 $104,268 11.1% 352 $76,750 $97,494 $111,924 13.9%
283 $71,575 $90,920 $104,378 11.2% 353 $76,825 $97,589 $112,034 13.9%
284 $71,650 $91,015 $104,487 11.2°0 354 $76,900 $97,684 $112,143 14.0%
285 $71,725 S91,110 $104,596 11.2% 355 $76,975 $97,779 $112,252 14.0%
286 $71,800 $91,206 $104,706 11.3% 356 $77,050 $97,875 $112,362 14.0%
287 $71,875 $91,301 $104,815 11.3% 357 $77,125 S97,970 S112,471 14.1%
288 $71,950 $91,396 $104,925 11.4% 358 $77,200 $98,065 $112,581 14.1%
289 $72,025 $91,492 $105,034 11.4% 359 $77,275 $98,160 $112,690 14.2%
290 $72,100 $91,587 $105,143 11.4% 360 $77,350 $98,256 $112,799 14.2%
291 $72,175 $91,682 $105,253 11.5% 361 $77,425 $98,351 $112,909 14.2%
292 $72,250 $91,777 $105,362 11.5% 362 $77,500 $98,446 $113,018 14.3%
293 $72,325 $91,873 $105,471 11.6% 363 $77,575 $98,542 $113,127 14.3%
294 $72,400 S91,968 $105,581 11.6% 364 $77,650 $98,637 $113,237 14.4%
295 $72,475 $92,063 $105,690 11.6% 365 $77,725 S98,732 $113,346 14.4%
296 $72,550 $92,158 $105,800 11.790 366 $77,800 $98,827 $113,456 14.4%
297 $72,625 $92,254 $105,909 11.7% 367 $77,875 $98,923 $113,565 14.5%
298 $72,700 $92,349 $106,018 11.8% 368 $77,950 $99,018 $113,674 14.5%
299 $72,775 $92,444 $106,128 11.8% 369 $78,025 S99,113 $113,784 14.6%
300 S72,850 $92,539 $106,237 11.8% 370 $78,100 $99,208 $113,893 14.6%
301 $72,925 $92,635 $106,346 11.9% 371 $78,175 $99,304 $114,002 14.6%
302 $73,000 $92,730 $106,456 11.9% 372 $78,250 $99,399 $114,112 14.7%
303 $73,075 $92,825 $106,565 12.0% 373 S78,325 $99,494 $114,221 14.7%
304 $73,150 $92,921 $106,674 12.0% 374 $78,400 $99,590 $114,331 14.8%
305 $73,225 $93,016 $106,784 12.0% 375 $78,475 $99,685 $114,440 14.8%
306 $73,300 $93,111 $106,893 12.1% 376 $78,550 $99,780 $114,549 14.8%
307 $73,375 $93,206 $107,003 12.1% 377 $78,625 $99,875 $114,659 14.9%
308 $73,450 $93,302 $107,112 12.2% 378 $78,700 $99,971 $114,768 14.9%
309 $73,525 $93,397 $107,221 12.2% 379 $78,775 $100,066 $114,877 15.0%
310 $73,600 $93,492 $107,331 12.2% 380 $78,850 $100,161 $114,987 15.0%
311 $73,675 $93,587 $107,440 12.3% 381 $78,925 $100,256 $115,096 15.0%
312 $73,750 $93,683 $107,549 12.3% 382 $79,000 $100,352 $115,206 15.1%
313 $73,825 $93,778 $107,659 12.4% 383 $79,075 $100,447 $115,315 15.1%
314 $73,900 $93,873 $107,768 12.4% 384 $79,150 $100,542 $115,424 15.2%
315 $73,975 $93,969 $107,878 12.4% 385 $79,225 $100,637 $115,534 15.2%
316 $74,050 $94,064 $107,987 12.5% 386 $79,300 $100,733 $115,643 15.2%
317 $74,125 $94,159 $108,096 12.5% 387 $79,375 $100,828 $115,752 15.3%
318 $74,200 $94,254 $108,206 12.5% 388 $79,450 $100,923 $115,862 15.3%
319 $74,275 $94,350 $108,315 12.6% 389 $79,525 $101,019 $115,971 15.4%
320 $74,350 $94,445 $108,424 12.6% 390 $79,600 $101,114 $116,081 15.4%
321 $74,425 $94,540 $108,534 12.7% 391 $79,675 $101,209 $116,190 15.4%
322 $74,500 $94,635 $108,643 12.7% 392 $79,750 $101,304 $116,299 15.5%
323 $74,575 $94,731 $108,753 12.7% 393 $79,825 $101,400 $116,409 15.5%
324 $74,650 $94,826 $108,862 12.8% 394 $79,900 $101,495 $116,518 15.5%
325 $74,725 $94,921 $108,971 12.8% 395 $79,975 $101,590 $116,627- 15.690
326 $74,800 $95,017 $109,081 12.9% 396 $80,050 $101,685 $116,737 15.6%
327 $74,875 $95,112 $109,190 12.9% 397 $80,069 $101,710 $116,764 15.7%
328 $74,950 $95,207 $109,299 12.9% 398 $80,138 5101,797 $116,865 15.7%
329 $75,025 $95,302 $109,409 13.0% 399 $80,207 $101,885 $116,966 15.7%
330 $75,100 $95,398 $109,518 13.0% 400 $80,276 $101,973 $117,066 15.8%
331 $75,175 $95,493 $109,628 13.1% 401 $80,345 $102,060 $117,167 15.8%
332 $75,250 $95,588 $109,737 13.1% 402 S80,414 5102,148 $117,268 15.9%
333 $75,325 $95,683 $109,846 13.1% 403 $80,483 3102,235 $117,368 15.9%
334 $75,400 S95,779 S109,956 13.290 404 S80,552 $102,323 $117,469 15.9%
335 S75,475 S95,874 $110,065 13.2% 405 $80,621 3102,411 $117,569 16.0%
336 $75,550 S95,969 $110,174 13.3% -106 '580,690 $102,498 $117,670 16.0%
337 S75,625 S96,065 $110,284 13.3 0 407 S80,759 S102,586 $117,771 16.1%
338 '575,700 S96,160 S110,393 13.3% 408 S80,828 5102,674 3117,871 16.1%
339 S75,775 S96,255 S110,503 13.4% 409 S80,897 3102,761 S117,972 16.1%
340 375,850 S96,350 S 110,612 13.4% 410 S80,966 $102,849 311 8,073 16.2%
341 S75,925 S96,446 3110,721 13.5% 411 $81,035 3102,937 $118,173 16.2%
342 .376.000 596,541 5110,831 13.590 J12 :581,104 '3103,024 S118,274 16.3%
243 376,075 396,636 5110,940 13.5% 413 $81,173 $103,112 $118,374 16.3%
744 376,150 ''S96,731 S111.049 13.6% :114 .581,242 :5103,200 S118,475 16.3%
345 576,225 :96.827 5111.159 13.69'. 415 '381.311 3103,287 S118,576 16.4%
346 376.300 396,922 .5111.268 13.77, 416 :581,380 .3103,375 S118.676 16.45
• Est.Current 2007 2010 Est.Current 2007 2010
Values Prjctn Prjctn %Ile Values Prjctn Prjctn %ile
557 S91,003 $115,599 $132,709 22.0% 627 $95,133 $120,845 $138,732 24.7%
558 $91,062 $115,674 $132,796 22.0% 628 $95,192 $120,920 $138,818 24.8%
559 $91,121 $115,749 $132,882 22.190 629 S95,251 $120,995 S138,904 24.8%
560 $91,180 S115,824 $132,968 22.1% 630 $95,310 $121,070 $138,990 24.9%
561 S91,239 $115,899 $133,054 22.1% 631 $95,369 $121,145 $139,076 24.9%
562 $91,298 $115,974 $133,140 22.2% 632 $95,428 $121,220 $139,162 24.9%
563 $91,357 $116,048 $133,226 22.2% 633 $95,487 $121,295 $139,248 25.0%
564 $91,416 $116,123 $133,312 22.3% 634 $95,546 $121,370 $139,335 25.0%
565 $91,475 $116,198 $133,398 22.3% 635 $95,605 $121,445 $139,421 25.1%
566 $91,534 $116,273 $133,484 22.3% 636 $95,664 $121,520 $139,507 25.1%
567 $91,593 $116,348 $133,570 22.4% 637 $95,723 $121,594 $139,593 25.1%
568 $91,652 $116,423 $133,656 22.4% 638 $95,782 $121,669 $139,679 25.2%
569 $91,711 $116,498 $133,742 22.5% 639 $95,841 $121,744 $139,765 25.2%
570 $91,770 $116,573 $133,828 22.5% 640 $95,900 $121,819 $139,851 25.3%
571 $91,829 $116,648 $133,914 22.5% 641 $95,959 $121,894 $139,937 25.3%
572 $91,888 $116,723 $134,000 22.6% 642 $96,018 $121,969 $140,023 25.3%
573 $91,947 $116,798 $134,086 22.6% 643 $96,077 $122,044 $140,109 25.4%
574 $92,006 $116,873 $134,172 22.7% 644 $96,136 $122,119 $140,195 25.4%
575 $92,065 $116,948 $134,258 22.7°%° 645 $96,195 $122,194 $140,281 25.5%
576 $92,124 $117,023 $134,344 22.7% 646 $96,254 $122,269 $140,367 25.5%
577 $92,183 $117,098 $134,430 22.8% 647 $96,313 $122,344 $140,453 25.5%
578 $92,242 $117,173 $134,516 22.8% 648 $96,372 $122,419 $140,539 25.6%
579 $92,301 $117,248 $134,602 22.8% 649 $96,431 $122,494 $140,625 25.6%
580 $92,360 $117,323 $134,688 22.9% 650 596,490 $122,569 $140,711 25.7%
581 $92,419 $117,397 $134,774 22.99'° 651 $96,549 $122,644 $140,797 25.7%
582 $92,478 $117,472 $134,860 23.0% 652 $96,608 $122,719 $140,883 25.79/o
583 $92,537 $117,547 $134,946 23.0% 653 S96,667 $122,794 $140,969 25.8%
584 $92,596 $117,622 $135,033 23.0% 654 $96,726 $122,869 $141,055 25.8%
585 $92,655 $117,697 $135,119 23.1% 655 S96,785 $122,944 $141,141 25.8%
586 $92,714 $117,772 $135,205 23.1% 656 $96,844 $123,018 $141,227 25.9%
587 $92,773 $117,847 $135,291 23.2% 657 $96,903 $123,093 $141,313 25.9%
588 $92,832 $117,922 $135,377 23.2% 658 $96,962 $123,168 $141,399 26.0%
589 $92,891 $117,997 $135,463 23.2% 659 $97,021 $123,243 $141,486 26.0%
590 $92,950 $118,072 $135,549 23.3% 660 $97,080 $123,318 $141,572 26.0%
591 $93,009 $118,147 $135,635 23.3% 661 $97,139 $123,393 $141,658 26.1%
592 $93,068 $118,222 $135,721 23.4% 662' $97,198 $123,468 $141,744 26.1%
593 $93,127 $118,297 $135,807 23.4% 663 $97,257 $123,543 $141,830 26.2%
594 $93,186 $118,372 $135,893 23.4% 664 $97,316 $123,618 $141,916 26.2%
595 $93,245 $118,447 $135,979 23.5% 665 $97,375 $123,693 $142,002 26.2%
596 $93,304 $118,522 $136,065 23.5% 666 $97,434 $123,768 $142,088 26.3%
597 $93,363 $118,597 $136,151 23.6% 667 $97,493 $123,843 $142,174 26.3%
598 $93,422 $118,672 $136,237 23.6% 668 $97,552 $123,918 $142,260 26.4%
599 $93,481 $118,747 $136,323 23.6% 669 $97,611 $123,993 $142,346 26.4%
600 $93,540 $118,821 $136,409 23.7% 670 $97,670 $124,068 $142,432 26.4%
601 $93,599 $118,896 $136,495 23.7% 671 $97,729 $124,143 $142,518 26.5%
602 $93,658 $118,971 $136,581 23.8% 672 $97,788 $124,218 $142,604 26.5%
603 $93,717 $119,046 $136,667 23.8% 673 $97,847 $124,293 $142,690 26.6%
604 $93,776 $119,121 $136,753 23.8% 674 $97,906 $124,367 $142,776 26.6%
605 $93,835 $119,196 $136,839 23.9% 675 $97,965 $124,442 $142,862 . 26.6%
606 $93,894 $119,271 $136,925 23.9% 676 $98,024 $124,517 $142,948 26.7%
607 $93,953 $119,346 $137,011 24.0% 677 $98,083 $124,592 $143,034 26.7%
608 $94,012 $119,421 $137,097 24.0% 678 S98,142 $124,667 $143,120 26.8%
609 $94,071 $119,496 $137,184 24.0% 679 $98,201 $124,742 $143,206 26.8%
610 $94,130 $119,571 $137,270 24.1% 680 $98,260 $124,817 $143,292 26.8%
611 $94,189 $119,646 $137,356 24.1% 681 $98,319 $124,892 $143,378 26.9%
612 $94,248 $119,721 $137,442 24.2% 682 $98,378 $124,967 $143,464 26.9%
613 $94,307 $119,796 $137,528 24.29'o 683 $98,437 5125,042 $143,550 27.0%
614 S94.366 S119,871 $137,614 24.2% 684 $98,496 $125,117 S143,636 27.0%
615 S94,425 S119,946 $137,700 24.3% 685 $98,555 3125,192 3143.723 27.0%
316 394,484 3120,021 51.,7,_86 24.3% 686 598,614 5125,267 3143,809 27.1%
,
617 394,543 5120,096 S137,872 24.3% 687 $98,673 $125,342 3143,895 27.1 9'.
618 394,602 3120,171 3137,958 24.4% 688 $98,732 3125,417 3143,981 27.2%
319 394.661 3120,245 3138,044 24.4% 689 398,791 5125,492 3144,067 27.2%
620 394,720 3120,320 3138,130 24.5% 690 $98,850 3125,567 3144.153 27.2%
621 394,779 5120,395 3138,216 24.5% 691 398,909 3125,642 3144.239 27.3%
622 394.838 .3120,470 '3138.302 24.5% .392 398,968 3125.717 3144,325 27.3%
623 :594.897 3120,545 3138,388 24.6% -393 :399.027 3125,7 91 3144.411 27.3%
'324 394.956 3120,620 5138,474 24.6% 694 399,086 '5125,866 3144,497 27.4%
325 295,015 3120,695 3138,560 24.7% 395 599,145 3125,941 3144.583 27.49'.
'326 395,074 .3120,770 '3138,646 24.7°6 696 :399,204 3126.016 3144,669 27.59'
Est.Current 2007 2010 Est. Current 2007 2010
' Values Prjctn Prjctn %ile Values Prjctn Prjctn %ire
837 $106,426 $135,190 $155,201 33.0% 907 $109,996 $139,725 $160,407 35.8%
838 $106,477 $135,255 $155,275 33.1% 908 $110,047 $139,790 $160,481 35.8%
839 $106,528 $135,320 $155,350 33.1% 909 $110,098 $139,855 S160,556 35.9%
840 $106,579 $135,385 5155,424 33.1% 910 $110,149 $139,919 $160,630 35.9%
841 $106,630 $135,449 $155,498 33.2% 911 $110,200 S139,984 $160,704 36.0%
842 $106,681 $135,514 $155,573 33.2% 912 $110,251 $140,049 $160,779 36.0%
843 $106,732 $135,579 $155,647 33.3% 913 $110,302 $140,114 $160,853 36.0%
844 $106,783 $135,644 $155,721 33.3% 914 $110,353 $140,179 $160,928 36.1%
845 $106,834 $135,708 $155,796 33.350 915 $110,404 $140,243 $161,002 36.1%
846 $106,885 $135,773 $155,870 33.4% 916 $110,455 $140,308 $161,076 36.1%
847 $106,936 $135,838 $155,945 33.4% 917 $110,506 $140,373 $161,151 36.2%
848 $106,987 $135,903 $156,019 33.5% 918 $110,557 $140,438 $161,225 36.2%
849 $107,038 $135,968 $156,093 33.5% 919 $110,608 $140,503 $161,299 36.3%
850 $107,089 $136,032 $156,168 33.5% 920 $110,659 $140,567 $161,374 36.3%
851 $107,140 $136,097 $156,242 33.6% 921 $110,710 $140,632 $161,448 36.3%
852 $107,191 $136,162 $156,316 33.6% 922 $110,761 $140,697 $161,523 36.4%
853 $107,242 $136,227 $156,391 33.7% 923 $110,812 $140,762 $161,597 36.4%
854 $107,293 $136,292 $156,465 33.7% 924 $110,863 $140,826 $161,671 36.5%
855 $107,344 $136,356 $156,540 33.7% 925 $110,914 $140,891 $161,746 36.5%
856 $107,395 $136,421 $156,614 33.8% 926 $110,965 $140,956 $161,820 36.5%
857 S107,446 $136,486 $156,688 33.8% 927 $111,016 $141,021 $161,894 36.6%
858 $107,497 $136,551 $156,763 33.9% 928 $111,067 $141,086 $161,969 36.6%
859 $107,548 $136,615 $156,837 33.9% 929 $111,118 $141,150 $162,043 36.7%
860 $107,599 $136,680 $156,911 33.9% 930 $111,169 $141,215 $162,118 36.7%
861 $107,650 $136,745 $156,986 34.0% 931 $111,220 $141,280 $162,192 36.7%
862 $107,701 $136,810 $157,060 34.0% 932 $111,271 $141,345 $162,266 36.8%
863 $107,752 $136,875 $157,135 34.1% 933 5 111,322 $141,409 $162,341 36.8%
864 $107,803 $136,939 $157,209 34.1% 934 $111,373 $141,474 $162,415 36.9%
865 $107,854 $137,004 $157,283 34.1% 935 $111,424 $141,539 $162,489 36.9%
866 $107,905 $137,069 $157,358 34.250 936 $111,475 $141,604 $162,564 36.9%
867 $107,956 $137,134 $157,432 34.2% 937 $111,526 $141,669 $162,638 37.0%
868 $108,007 $137,199 $157,506 34.3% 938 $111,577 $141,733 $162,712 37.0%
869 $108,058 $137,263 $157,581 34.3% 939 $111,628 $141,798 $162,787 37.1%
870 $108,109 $137,328 $157,655 34.3% 940 $111,679 $141,863 $162,861 37.1%
871 $108,160 $137,393 $157,729 34.4% 941 $111,730 $141,928 $162,936 37.1%
872 $108,211 $137,458 $157,804 34.4% 942 $111,781 $141,993 $163,010 37.2%
873 $108,262 $137,522 $157,878 34.5% 943 $111,832 $142,057 $163,084 37.2%
874 $108,313 $137,587 $157,953 34.5% 944 $111,883 $142,122 $163,159 37.3%
875 $108,364 $137,652 $158,027 34.5% 945 $111,934 $142,187 $163,233 37.3%
876 $108,415 $137,717 $158,101 34.6% 946 $111,985 $142,252 $163,307 37.3%
877 $108,466 $137,782 $158,176 34.6% 947 $112,036 $142,316 $163,382 37.4%
878 $108,517 $137,846 $158,250 34.6% 948 $112,087 $142,381 $163,456 37.4%
879 $108,568 $137,911 $158,324 34.7% 949 $112,138 $142,446 $163,531 37.5%
880 $108,619 $137,976 $158,399 34.7% 950 $112,189 $142,511 $163,605 37.5%
881 $108,670 $138,041 $158,473 34.8% 951 $112,240 $142,576 $163,679 37.5%
882 $108,721 $138,106 $158,548 34.8% 952 $112,291 $142,640 $163,754 37.6%
883 $108,772 $138,170 $158,622 34.8% 953 $112,342 $142,705 $163,828 37.6%
884 $108,823 $138,235 $158,696 34.9% 954 $112,393 $142,770 $163,902 37.6%
885 $108,874 $138,300 $158,771 34.9% 955 $112,444 $142,835 $163,977 37.79%0
886 $108,925 $138,365 $158,845 35.0% 956 $112,495 $142,900 $164,051 37.7%
887 $108,976 $138,429 $158,919 35.0% 957 $112,546 $142,964 $164,126 37.8%
888 $109,027 $138,494 $158,994 35.0% 958 $112,597 $143,029 $164,200 37.8%
889 $109,078 $138,559 $159,068 35.1% 959 $112,648 $143,094 $164,274 37.8%
890 $109,129 $138,624 $159,143 35.1% 960 $112,699 $143,159 $164,349 37.9%
891 $109,180 $138,689 $159,217 35.2% 961 $112,750 $143,223 $164,423 37.990
892 $109,231 $138,753 5159,291 35.2% 962 $112,801 $143,288 $164,497 38.0%
893 3109,282 S138,818 $159,366 35.2% 963 3112,852 $143,353 $164,572 38.0%
894 $109,333 $138,883 $159,440 35.3% 964 3112,903 $143,418 $164,646 38.0%
895 3109,384 $138,948 $159,514 35.3% 965 $112,954 $143,483 $164,721 38.1%
896 $109,435 3139,012 3159.589 35.4% 966 $113,005 3143,547 $164,795 38.1%
397 $109,486 3139,077 S159,663 35.4% 967 $113,056 3143,612 3164,869 38.2%
398 3109,537 $139,142 3159,738 35.4% 968 3113,107 3143,677 $164,944 38.2%
899 3109,588 $139.207 .3159,812 35.5% 969 $113,158 3143,742 $165,018 38.2%
900 3109.639 3139.272 .3159,886 35.5% 970 3113,209 3143,806 S165,092 38.3%
901 3109,690 3139,336 $159,961 35.6% 971 3113,260 3143,871 $165,167 38.3%
902 '3109, 41 3139.401 3160.035 35.6% 972 3113,311 3143.936 $165,241 38.4%
903 3109,792 S139,466 `3160,109 35.6% 973 S113,362 S144,001 3165,316 38.4%
104 '3109.843 .3139,531 3160.184 35. 974 5113,413 S144.066 S165.390 38.4%
.105 3109,894 3139,596 5160.258 35.7% 975 3113,464 3144.130 3165.464 18.5%
906 3109.945 S139,660 3160,333 '35.8% 976 3 1 13,515 .3144.195 .3165,539 '38.5%
Est.Current 2007 2010 Est. Current 2007 2010
Values Prjctn Prjctn %ile Values Prjctn Prjctn %ile
1117 $120,728 $153,358 $176,057 44.1% 1187 $124,648 $158,337 $181,774 46.8%
1118 $120,784 $153,429 $176,139 44.1% 1188 $124,704 $158,408 $181,856 46.9%
1119 $120,840 $153,500 $176,221 44.2% 1189 $124,760 $158,479 $181,937 46.9%
1120 $120,896 $153,571 $176,302 44.2% 1190 $124,816 $158,551 $182,019 47.0%
1121 $120,952 $153,642 $176,384 44.2% 1191 $124,872 $158,622 $182,101 47.0%
1122 $121,008 $153,713 $176,466 44.3% 1192 $124,928 $158,693 $182,182 47.0%
1123 $121,064 $153,785 $176,547 44.3% 1193 $124,984 $158,764 $182,264 47.1%
1124 $121,120 $153,856 $176,629 44.4% 1194 $125,040 $158,835 $182,346 47.1%
1125 $121,176 $153,927 $176,711 44.4% 1195 $125,096 $158,906 $182,427 47.2%
1126 $121,232 $153,998 $176,792 44.4% 1196 $125,152 $158,977 $182,509 47.2%
1127 $121,288 $154,069 $176,874 44.5% 1197 $125,208 $159,049 $182,591 47.2%
1128 $121,344 $154,140 $176,956 44.5% 1 198 $125,264 $159,120 $182,672 47.3%
1129 $121,400 $154,211 $177,037 44.6% 1199 $125,320 $159,191 $182,754 47.3%
1130 $121,456 $154,282 $177,119 44.6% 1200 $125,376 $159,262 $182,836 47.4%
1131 $121,512 $154,354 $177,201 44.6% 1201 $125,432 $159,333 $182,917 47.4%
1132 $121,568 $154,425 $177,282 44.7% 1202 $125,488 $159,404 $182,999 47.4%
1133 $121,624 $154,496 $177,364 44.7% 1203 $125,544 $159,475 $183,081 47.5%
1134 $121,680 $154,567 $177,446 44.8% 1204 $125,600 $159,546 $183,162 47.5%
1135 $121,736 $154,638 $177,527 44.8% 1205 $125,656 $159,618 $183,244 47.6%
1136 $121,792 $154,709 $177,609 44.8% 1206 $125,712 $159,689 $183,326 47.6%
1137 $121,848 $154,780 $177,691 44.9% 1207 $125,768 $159,760 $183,407 47.6%
1138 $121,904 $154,852 $177,772 44.9% 1208 $125,824 $159,831 $183,489 17.7%
1139 $121,960 $154,923 $177,854 44.9% 1209 $125,880 $159,902 $183,571 47.7%
1140 $122,016 $154,994 $177,936 45.0% 1210 $125,936 $159,973 $183,652 47.8%
1141 $122,072 $155,065 $178,017 45.0% 1211 $125,992 $160,044 $183,734 47.8%
1142 $122,128 $155,136 $178,099 45.1% 1212 S126,048 $160,116 $183,816 47.8%
1143 $122,184 $155,207 $178,181 45.1% 1213 $126,104 $160,187 $183,897 47.9%
1144 $122,240 $155,278 $178,262 45.1% 1214 $126,160 $160,258 $183,979 47.9%
1145 $122,296 $155,349 $178,344 45.2% 1215 $126,216 $160,329 $184,061 47.9%
1146 $122,352 $155,421 $178,426 45.2% 1216 $126,272 $160,400 $184,142 48.0%
1147 $122,408 $155,492 $178,507 45.3% 1217 $126,328 $160,471 $184,224 48.0%
1148 $122,464 $155,563 $178,589 45.3% 1218 $126,384 $160,542 $184,306 48.1%
1149 $122,520 $155,634 $178,671 45.3% 1219 $126,440 $160,614 $184,387 48.1%
1150 $122,576 $155,705 $178,752 45.4% 1220 $126,496 $160,685 $184,469 48.1%
1151 $122,632 $155,776 $178,834 45.4% 1221 $126,552 $160,756 $184,550 48.2%
1152 $122,688 $165,847 $178,916 45.5% 1222 $126,608 $160,827 $184,632 48.2%
1153 $122,744 $155,919 $178,997 45.5% 1223 $126,664 $160,898 $184,714 48.3%
1154 $122,800 $155,990 $179,079 45.5% 1224 $126,720 $160,969 $184,795 48.3% •
1155 $122,856 $156,061 $179,161 45.6% 1225 $126,776 $161,040 $184,877 48.3%
1156 $122,912 $156,132 $179,242 45.6% 1226 $126,832 $161,111 $184,959 48.4%
1157 $122,968 $156,203 $179,324 45.7% 1227 $126,888 $161,183 $185,040 48.4%
1158 $123,024 $156,274 $179,406 45.7% 1228 $126,944 $161,254 $185,122 48.5%
1159 $123,080 $156,345 $179,487 45.7% 1229 $127,000 $161,325 $185,204 48.5%
1160 $123,136 $156,417 $179,569 45.8% 1230 $127,056 $161,396 $185,285 48.5%
1161 $123,192 $156,488 $179,651 45.8% 1231 $127,112 $161,467 $185,367 48.69/0
1162 $123,248 $156,559 $179,732 45.9% 1232 $127,168 $161,538 $185,449 48.6%
1163 $123,304 $156,630 $179,814 45.9% 1233 $127,224 $161,609 $185,530 48.7%
1164 $123,360 $156,701 $179,896 45.9% 1234 $127,280 $161,681 $185,612 48.7%
1165 $123,416 $156,772 $179,977 46.0% 1235 $127,336 $161,752 $185,694 " 48.7%
1166 $123,472 $156,843 $180,059 46.0% 1236 $127,392 $161,823 $185,775 48.8%
1167 $123,528 $156,914 $180,141 46.1% 1237 $127,448 $161,894 $185,857 48.8%
1168 $123,584 $156,986 $180,222 46.1°0 1238 $127,504 $161,965 $185,939 48.9%
1169 $123,640 $157,057 $180,304 46.1% 1239 $127,560 $162,036 $186,020 48.9%
1170 $123,696 $157,128 $180,386 46.2°0 1240 $127,616 $162,107 $186,102 48.9%
1171 $123,752 $157,199 $180,467 46.2% 1241 $127,672 $162,178 $186,184 49.0%
1172 $123,808 $157,270 $180,549 46.3% 1242 $127,728 $162,250 $186,265 49.0%
1173 $123,864 $157,341 3180,631 46.3% 1243 $127,784 $162,321 $186,347 49.1%
1174 $123,920 $157,412 $180,712 46.3% 1244 S127,840 $162,392 $186,429 49.1%
1175 $123,976 $157,484 S180,794 46.4% 1245 $127,896 5162,463 S186,510 49.190
1176 $124,032 S157,555 $180,876 46.49'0 1246 $127.952 $162,534 5186,592 49.290
1177 5124,088 5157,626 $180,957 46.4/° 1247 3128.008 5162,605 5186,674 49.2%
1 178 3124,144 3157,697 3181,039 46.5% 1248 5128,064 5162,676 $186,755 49.3%
1179 5124,200 5157.768 5181,121 46.5% 1249 3128,120 $162,748 S186,837 49.3°0
1180 3124.256 3157,839 5181,202 46.6% 1250 5128,176 5162,819 $186,919 49.3%
1181 3124,312 3157,910 5181,284 46.6% 1251 5128,232 $162,890 $187,000 49.4%
1182 .3124.368 '3157,981 '5181,366 46.6°% 1252 3128,288 $162,961 $187,082 49.490
i 183 5124.424 5158,053 5181,447 46.7°0 1253 3128,344 :3163,032 5187,164 49.4%
i184 3124,480 5158.124 :5181,529 46.7% 1254 S128,400 5163,103 5187,245 -L9.5%
1185 0124.536 3158.195 51 81.611 46.8% 1255 5128,456 5163,174 2187,327 -49.590
1186 :124..392 3158,266 3181,692 46.8% 1256 3128,512 '3163,246 0187,409 49.6%
• ' Est.Current 2007 2010 Est.Current 2007 2010
Values Prjctn Prjctn %ile Values Prjctn Prjctn %Ile
1397 $136,408 $173,276 $198,923 55.1% 1467 $140,800 $178,855 $205,328 57.9%
1398 $136,464 $173,347 $199,005 55.2% 1468 $140,900 S178,982 $205,474 57.99/0
1399 $136,520 $173,418 $199,087 55.2% 1469 $141,000 $179,109 $205,620 58.0%
1400 $136,576 $173,489 S199,168 55.2% 1470 $141,100 $179,236 $205,766 58.0%
1401 $136,632 $173,560 $199,250 55.3% 1471 $141,200 $179,363 $205,912 58.1%
1402 $136,688 $173,631 $199,332 55.3% 1472 $141,300 $179,490 $206,057 58.1%
1403 $136,744 $173,702 $199,413 55.4% 1473 $141,400 $179,617 $206,203 58.1%
1404 $136,800 $173,774 $199,495 55.4% 1474 $141,500 $179,744 $206,349 58.2%
1405 $136,856 $173,845 $199,577 55.4% 1475 $141,600 $179,871 $206,495 58.2%
1406 $136,912 $173,916 $199,658 55.5% 1476 $141,700 $179,998 $206,641 58.2%
1407 $136,968 $173,987 $199,740 55.5% 1477 $141,800 $180,125 $206,787 58.3%
1408 $137,024 $174,058 $199,822 55.6% 1478 $141,900 $180,252 $206,932 58.3%
1409 $137,080 $174,129 $199,903 55.6% 1479 $142,000 $180,379 $207,078 58.4%
1410 $137,136 $174,200 $199,985 55.6% 1480 $142,100 $180,506 $207,224 58.4%
1411 $137,192 $174,271 $200,067 55.7% 1481 $142,200 $180,633 $207,370 58.4%
1412 $137,248 $174,343 $200,148 55.7% 1482 $142,300 $180,760 $207,516 58.5%
1413 $137,304 $174,414 $200,230 55.8% 1483 $142,400 $180,887 $207,662 58.5%
1414 $137,360 $174,485 $200,312 55.8% 1484 $142,500 $181,014 $207,807 58.6%
1415 $137,416 $174,556 $200,393 55.8% 1485 $142,600 $181,141 $207,953 58.6%
1416 $137,472 $174,627 $200,475 55.9% 1486 S142,700 $181,268 $208,099 58.6%
1417 $137,528 $174,698 $200,557 55.9% 1487 $142,800 $181,395 $208,245 58.7%
1418 S137,584 $174,769 $200,638 56.0% 1488 $142,900 $181,522 $208,391 58.79/0
1419 $137,640 $174,841 $200,720 56.0% 1489 $143,000 $181,649 $208,537 58.8%
1420 $137,696 $174,912 $200,802 56.0% 1490 $143,100 $181,776 $208,682 58.8%
1421 $137,752 $174,983 $200,883 56.1% 1491 $143,200 $181,903 $208,828 58.8%
1422 $137,808 $175,054 $200,965 56.1% 1492 $143,300 $182,030 $208,974 58.9%
1423 $137,864 $175,125 $201,047 56.2% 1493 $143,400 $182,157 $209,120 58.9%
1424 $137,920 $175,196 $201,128 56.2% 1494 $143,500 $182,284 $209,266 59.0%
1425 $137,976 $175,267 $201,210 56.2% 1495 $143,600 $182,411 $209,412 59.0%
1426 $138,032 $175,339 $201,292 56.3% 1496 $143,700 $182,538 $209,557 59.0%
1427 $138,088 $175,410 $201,373 56.3% 1497 $143,800 $182,665 $209,703 59.1%
1428 $138,144 $175,481 $201,455 56.4% 1498 $143,900 $182,792 $209,849 59.1%
1429 $138,200 $175,552 $201,537 56.4% 1499 $144,000 $182,920 $209,995 59.2%
1430 $138,256 $175,623 $201,618 56.4510 1500 $144,100 $183,047 $210,141 59.2%
1431 $138,312 $175,694 $201,700 56.5% 1501 $144,200 $183,174 $210,287 59.2%
1432 $138,368 $175,765 $201,782 56.5% 1502 $144,300 $183,301 $210,432 59.3%
1433 $138,424 $175,836 $201,863 56.6% 1503 $144,400 $183,428 $210,578 59.3%
1434 $138,480 $175,908 $201,945 56.6% 1504 $144,500 $183,555 $210,724 59.4% •
1435 $138,536 $175,979 $202,027 56.6% 1505 $144,600 $183,682 $210,870 59.4% •
1436 $138,592 $176,050 $202,108 56.7% 1506 $144,700 $183,809 $211,016 59.4%
1437 $138,648 $176,121 $202,190 56.7% 1507 $144,800 $183,936 $211,162 59.5%
1438 $138,704 $176,192 $202,272 56.7% 1508 $144,900 $184,063 $211,307 59.5%
1439 $138,760 $176,263 $202,353 56.8% 1509 $145,000 $184,190 $211,453 59.6%
1440 $138,816 $176,334 $202,435 56.8% 1510 $145,100 $184,317 $211,599 59.6%
1441 $138,872 $176,406 $202,517 56.9% 1511 $145,200 $184,444 $211,745 59.6%
1442 $138,928 $176,477 $202,598 56.9% 1512 $145,300 $184,571 $211,891 59.7%
1443 $138,984 $176,548 $202,680 56.95'o 1513 $145,400 $184,698 $212,036 59.7%
1444 $139,040 $176,619 $202,762 57.0% 1514 $145,500 $184,825 $212,182 59.79/0
1445 $139,096 $176,690 $202,843 57.0% 1515 $145,600 $184,952 $212,328 59.8%
1446 $139,152 $176,761 $202,925 57.1% 1516 $145,700 $185,079 $212,474 59.8%
1447 $139,208 $176,832 $203,007 57.1% 1517 $145,800 $185,206 $212,620 59.9%
1448 $139,264 $176,903 $203,088 57.1% 1518 $145,900 $185,333 $212,766 59.9%
1449 $139,320 $176,975 $203,170 57.2% 1519 $146,000 $185,460 $212,911 59.9%
1450 $139,376 $177,046 $203,252 57.2% 1520 $146,100 $185,587 $213,057 60.0%
1451 $139,432 $177,117 $203,333 57.3% 1521 $146,200 $185,714 $213,203 60.0%
1452 $139,488 $177,188 $203,415 57.3% 1522 $146,300 $185,841 $213,349 60.1%
1453 $139,544 $177,259 $203,497 57.3% 1523 $146,400 $185,968 $213,495 60.1%
1454 $139,600 $177,330 3203.578 57.4°'0 1524 $146,500 S186.095 $213,641 60.1%
1455 $139.656 $177,401 $203,660 57.4% 1525 $146,600 $186,222 $213.786 60.2%
1456 $139,712 $177,473 3'203,742 57.5% 1526 $146,700 $186,349 $213,932 60.29'.
1457 $139.768 3177,544 S203.823 57.5% 1527 $146,800 $186,476 $214,078 60.3%
1458 S139.824 $177,615 $203,905 57.5% 1528 3146,900 S 186.603 $214,224 60.3%
1459 3'139,880 3177,686 S203,987 57.6% 1529 3147,000 $186,730 S214.370 60.3%
1460 3140,100 '3177,965 3204,308 57.6% 1530 $147,100 5186,857 5214,516 60.496
1461 $140,200 3178,092 3204.453 57.7% 1531 3147,200 S186.984 $214,661 50.4%
1462 $140,200 3178.220 3204,599 57.7% 1532 3147.300 .3187,111 :3214,807 60.5%
1463 3140,400 3178.347 3204,745 57.7°5 1.533 `3147,400 3187,238 3214,953 60.5%
464 3140,500 3178.474 3204.891 67.3% 1.534 3147,500 5187,365 3'215,099 30.5%
1465 3140.600 13178,601 S205,037 37.8% 1535 .3147,600 3187,493 S215.245 30.6%
:466 '3140,700 1178,728 3205,182 57.9% 1536 3147,700 .3187,620 S215,391 30.6%
' Est.Current 2007 2010 Est. Current 2007 2010
Values Prjctn Prjctn %ile Values Prjctn Prjctn %ile
1677 $161,853 $205,598 S236,030 66.2% 1747 $169,483 $215,290 S247,157 68.9%
1678 $161,962 S205,736 S236,189 66.2% 1748 $169,592 S215,428 $247,316 69.090
1679 $162,071 $205,875 S236,348 66.3% 1749 $169,701 $215,567 $247,475 69.0%
1680 $162,180 $206,013 $236,507 66.3% 1750 $169,810 $215,705 $247,634 69.1%
1681 $162,289 $206,152 $236,666 66.3% 1751 $169,919 $215,844 $247,792 69.1%
1682 $162,398 $206,290 $236,825 66.4% 1752 $170,028 $215,982 $247,951 69.1%
1683 $162,507 $206,428 $236,984 66.4% 1753 $170,137 S216,121 $248,110 69.2%
1684 $162,616 $206,567 $237,143 66.5% 1754 $170,246 $216,259 $248,269 09.2%
1685 $162,725 $206,705 $237,302 66.5% 1755 $170,355 $216,398 $248,428 69.3%
1686 $162,834 $206,844 $237,460 66.5% 1756 $170,464 $216,536 $248,587 69.3%
1687 $162,943 $206,982 $237,619 66.6% 1757 $170,573 $216,675 $248,746 69.3%
1688 $163,052 $207,121 $237,778 66.6% 1758 $170,682 $216,813 $248,905 69.4%
1689 $163,161 $207,259 $237,937 66.7% 1759 $170,791 $216,951 $249,064 69.4%
1690 $163,270 $207,398 $238,096 66.7% 1760 $170,900 $217,090 $249,223 69.5%
1691 $163,379 $207,536 $238,255 66.7% 1761 $171,009 $217,228 $249,382 69.5%
1692 $163,488 $207,675 $238,414 66.8% 1762 $171,118 $217,367 $249,541 69.5%
1693 $163,597 $207,813 $238,573 66.8% 1763 $171,227 $217,505 $249,700 69.6%
1694 $163,706 $207,952 $238,732 66.9% 1764 $171,336 $217,644 $249,859 69.690
1695 $163,815 $208,090 $238,891 66.9% 1765 $171,445 S217,782 $250,018 69.7%
1696 $163,924 $208,228 $239,050 66.9% 1766 $171,554 $217,921 $250,177 69.790
1697 $164,033 $208,367 $239,209 67.0% 1767 $171,663 $218,059 $250,336 69.7%
1698 $164,142 $208,505 $239,368 67.0% 1768 $171,772 $218,198 $250,495 69.8%
1699 $164,251 $208,644 $239,527 67.0% 1769 $171,881 $218,336 $250,654 69.8%
1700 $164,360 $208,782 $239,686 67.1% 1770 $171,990 $218,475 S250,813 69.9%
1701 $164,469 $208,921 $239,845 67.1910 1771 $172,099 $218,613 $250,972 69.9%
1702 $164,578 $209,059 $240,004 67.2% 1772 $172,208 $218,751 $251,131 69.9%
1703 $164,687 $209,198 S240,163 67.2% 1773 $172,317 $218,890 $251,289 70.0%
1704 $164,796 $209,336 $240,322 67.290 1774 $172,426 $219,028 $251,448 70.0%
1705 $164,905 $209,475 $240,481 67.3% 1775 $172,535 $219,167 $251,607 70.0%
1706 $165,014 $209,613 $240,640 67.3% 1776 $172,644 $219,305 $251,766 70.1%
1707 $165,123 $209,752 $240,799 67.4% 1777 $172,753 $219,444 $251,925 70.1%
1708 $165,232 $209,890 $240,957 67.4% 1778 $172,862 $219,582 $252,084 70.2%
1709 $165,341 $210,028 $241,116 67.4% 1779 $172,971 $219,721 $252,243 70.2%
1710 $165,450 $210,167 $241,275 67.5% 1780 $173,080 $219,859 $252,402 70.2%
1711 $165,559 $210,305 $241,434 67.5% . 1781 $173,189 $219,998 $252,561 70.3%
1712 $165,668 $210,444 $241,593 67.6% 1782 $173,298 $220,136 $252,720 70.3%
1713 $165,777 $210,582 $241,752 67.6% 1783 $173,407 $220,274 $252,879 70.4%
1714 $165,886 $210,721 $241,911 67.6% 1784 $173,516 $220,413 $253,038 70.4%
1715 $165,995 $210,859 $242,070 67.7% 1785 $173,625 $220,551 $253,197 70.4%
1716 $166,104 $210,998 $242,229 67.7% 1786 $173,734 $220,690 $253,356 70.5%
1717 $166,213 $211,136 $242,388 67.8% 1787 $173,843 $220,828 $253,515 70.5%
1718 $166,322 $211,275 $242,547 67.8% 1788 $173,952 $220,967 $253,674 70.6%
1719 $166,431 $211,413 $242,706 67.8% 1789 $174,061 $221,105 $253,833 70.6%
1720 $166,540 $211,552 $242,865 67.9% 1790 $174,170 $221,244 $253,992 70.6%
1721 $166,649 $211,690 $243,024 67.9% 1791 $174,279 $221,382 $254,151 70.7%
1722 $166,758 $211,828 $243,183 68.0% 1792 $174,388 $221,521 $254,310 70.7%
1723 $166,867 $211,967 $243,342 68.0% 1793 $174,497 $221,659 $254,469 70.8%
1724 $166,976 $212,105 $243,501 68.0% 1794 $174,606 $221,798 $254,628 70.8%
1725 $167,085 $212,244 $243,660 68.1% 1795 $174,715 $221,936 $254,786 70.8%
1726 $167,194 $212,382 $243,819 68.1% 1796 $174,824 $222,074 $254,945 70.9%
1727 $167,303 $212,521 $243,978 68.2% 1797 $174,933 $222,213 $255,104 70.9%
1728 $167,412 $212,659 $244,137 68.2% 1798 $175,042 $222,351 $255,263 71.090
•
1729 $167,521 $212,798 $244,295 68.2% 1799 $175,151 $222,490 $255,422 71.0%
1730 $167,630 $212,936 $244,454 68.3% 1800 $175,260 $222,628 $255,581 71.0%
1731 $167,739 $213,075 $244,613 68.3% 1801 $175,369 $222,767 $255,740 71.1%
1732 $167,848 $213,213 $244,772 68.4% 1802 $175,478 $222,905 $255,899 71.1°/0
1733 $167,957 $213,351 $244,931 68.4% 1803 $175,587 $223,044 5256,058 71.2
1734 $168,066 $213,490 S245,090 68.4% 1804 13175,696 $223,182 3256,217 71.2%
1735 5168,175 $213,628 5245,249 68.5% 1805 5175,805 $223.321 3256,376 71.290
1736 5168,284 5213,767 5245,408 68.5% 1806 5175,914 $223,459 5256,535 71.3%
1737 5168,393 5213.905 5245,567 68.5% 1807 5176,023 $223.598 S256,694 71.3%
'1738 3168,502 $214,044 5245,726 68.6% 1808 5176,132 $223,736 5256,853 71.3%
1739 5168,611 $214,182 5245,885 68.6% 1809 5176,241 $223,874 S257.012 71.490
1 740 5168.720 $214,321 3246,044 68.7% 1810 5176,350 $224,013 S257,171 71.4%
1741 5168,829 $214,459 $246,203 68.79'., 1811 S176.459 5224,151 5257, 30 71.5%
1742 '3168,938 3214.598 :3246.362 68.7°5 1812 :3176,568 5224,290 5257,489 71.5%
1743 :5169,047 5'214,736 5246.521 68.8% 1813 5176,677 5224,428 3257.648 71.5%
1744 3169.156 :',21 4.875 .5246,680 88.8% 1814 S 176,786 3224,567 `5257.307 71.6%
745 3169,265 '3215.013 '3246,839 58.9% 1815 .5176,895 3224,705 5257.966 71.3%
1746 :3169,374 '5215,15 1 5246.998 58.9% 1816 '3177,004 5224.344 3258.:25 71_705
I
Est.Current 2007 2010 Est.Current 2007 2010
Values Prjctn Prjctn %ile Values Prjctn Prjctn %de
1957 $195,618 S248,489 S285,269 77.2% 2027 $206,726 $262,599 $301,468 80.0%
1958 $195,755 S248,663 S285,469 77.3% 2028 $206,903 $262,824 $301,726 80.0%
1959 S195,892 $248,837 $285,669 77.3% 2029 $207,080 S263,048 $301,984 80.1%
1960 $196,029 $249,011 $285,869 77.3% 2030 $207,257 $263,273 $302,242 80.1%
1961 $196,166 $249,185 S286,068 77.4% 2031 $207,434 $263,498 $302,501 80.1%
1962 $196,303 $249,359 S286,268 77.4% 2032 $207,611 $263,723 $302,759 80.2%
1963 $196,440 $249,533 $286,468 77.5% 2033 $207,788 $263,948 $303,017 80.290
1964 $196,577 $249,707 $286,668 77.50 2034 $207,965 $264,173 $303,275 80.3%
1965 $196,714 $249,881 $286,868 77.5% 2035 $208,142 $264,397 $303,533 80.3%
1966 $196,851 $250,055 $287,067 77.6% 2036 $208,319 $264,622 $303,791 80.3%
1967 $196,988 $250,229 $287,267 77.6% 2037 $208,496 $264,847 $304,049 80.4%
1968 $197,125 $250,403 $287,467 77.7% 2038 $208,673 $265,072 $304,307 80.4%
1969 $197,262 $250,577 $287,667 77.7% 2039 $208,850 S265,297 $304,565 80.5%
1970 $197,399 $250,751 $287,867 77.790 2040 $209,027 S265,522 $304,824 80.50
1971 $197,536 $250,925 $288,066 77.8% 2041 $209,204 $265,746 $305,082 80.5%
1972 $197,673 $251,099 $288,266 77.8% 2042 $209,381 $265,971 $305,340 80.6%
1973 $197,810 $251,273 $288,466 77.9% 2043 $209,558 $266,196 $305,598 80.6%
1974 $197,947 $251,447 $288,666 77.9% 2044 $209,735 $266,421 $305,856 80.7%
1975 $198,084 $251,621 $288,865 77.9% 2045 $209,912 $266,646 $306,114 80.7%
1976 $198,221 $251,795 $289,065 78.0% 2046 $210,089 $266.871 $306,372 80.7%
1977 $198,358 $251,969 $289,265 78.0% 2047 $210,266 $267,096 $306,630 80.8%
1978 $198,495 $252,143 $289,465 78.1% 2048 $210,443 S267,320 $306,889 90.8%
1979 $198,632 $252,317 $289,665 78.1% 2049 $210,620 $267,545 $307,147 80.9%
1980 $198,769 $252,491 S289,864 78.1% 2050 $210,797 $267,770 $307,405 80.9%
1981 $198,906 $252.665 S290,064 78.2% 2051 $210,974 $267,995 $307,663 80.9%
1982 $199,043 $252,839 $290,264 78.2% 2052 $211.151 $268,220 $307,921 81.0%
1983 $199,180 $253,013 $290,464 78.3% 2053 $211,328 $268,445 $308,179 81.0%
1984 $199,317 $253,187 $290,664 78.3% 2054 $211,505 $268,569 $308,437 81.1%
1985 $199,454 $253,361 $290,863 78.3% 2055 $211,682 $268,894 $308,695 81.1%
1986 $199,591 $253,535 $291,063 78.4% 2056 $211,859 $269,119 $308,954 81.1%
1987 $199,728 $253,709 $291,263 78.4% 2057 $212,036 $269,344 $309,212 81.2%
1988 $199,865 $253,883 $291,463 78.5% 2058 $212,213 $269,569 $309,470 81.2%
1989 $200,002 $254,057 $291,662 78.5% 2059 $212,390 $269,794 $309,728 81.3%
1990 $200,177 $254,280 $291,918 78.5% 2060 $212,567 $270,018 $309,986 81.3%
1991 $200,354 $254,505 $292,176 78.6% 2061 $212,744 $270,243 $310,244 81.3%
1992 $200,531 $254,729 $292,434 78.6% 2062 $212,921 $270,468 $310,502 81.4%
1993 $200,708 $254,954 $292,692 78.7% 2063 $213,098 $270,693 $310,760 81.4%
1994 $200,885 $255,179 $292,950 78.7% 2064 $213,275 $270,918 $311,018 81.5%
1995 $201,062 $255,404 $293,208 78.7% 2065 $213,452 $271,143 $311,277 81.5%
1996 $201,239 $255,629 $293,466 78.8% 2066 $213,629 $271,367 $311,535 81.5%
1997 $201,416 $255,854 $293,725 78.8% 2067 $213,806 $271,592 $311,793 81.6%
1998 $201,593 $256,078 $293,983 78.8% 2068 $213,983 $271,817 $312,051 81.6%
1999 $201,770 $256,303 $294,241 78.9% 2069 $214,160 $272,042 $312,309 81.6%
2000 $201,947 $256,528 $294,499 78.9% 2070 $214,337 $272,267 $312,567 81.7%
2001 $202,124 $256,753 $294,757 79.0% 2071 $214,514 $272,492 $312,825 81.7%
2002 $202,301 $256,978 $295,015 79.0% 2072 $214,691 $272,716 $313,083 81.8%
2003 $202,478 $257,203 $295,273 79.0% 2073 $214,868 $272,941 $313,342 81.8%
2004 $202,655 $257,427 $295,531 79.1% 2074 $215,045 $273,166 $313,600 81.8%
2005 $202,832 $257,652 $295,789 79.1% 2075 $215,222 $273,391 $313,858 . 81.9%
2006 $203,009 $257,877 $296,048 79.2% 2076 $215,399 $273,616 $314,116 81.9%
2007 $203,186 $258,102 $296,306 79.2% 2077 $215,576 $273,841 $314,374 82.0%
2008 $203,363 $258,327 $296,564 79.2% 2078 $215,753 $274,066 $314,632 82.0%
2009 $203,540 $258,552 $296,822 79.3% 2079 $215,930 $274,290 $314,890 82.0%
2010 $203,717 $258,776 $297,080 79.3% 2080 $216,107 $274,515 $315,148 82.1%
2011 $203,894 $259,001 $297,338 79.4% 2081 $216,284 $274,740 $315,406 82.1%
2012 $204,071 $259,226 S297,596 79.4% 2082 $216,461 $274,965 $315,665 82.2%
2013 $204,248 $259,451 $297,854 79.4% 2083 $216,638 $275,190 $315,923 82.2%
2014 S204,425 $259,676 S298,113 79.5% 2084 5216,815 $275,415 $316,181 32.2%
2015 $204,602 S259.901 $298,371 79.5% 2085 $216,992 S275,639 $316,439 82.3%
2016 S204.779 3260,126 $298,629 79.6% 2086 $217,169 '3275,864 S316,697 82.3%
2017 $204,956 S260,350 $298,887 79.6% 2087 $217,346 3276,089 S316.955 82.4%
2018 $205,133 $260,575 3299.145 79.6% 2088 $217,523 3276,314 $317,213 82.4%
2019 S205,310 3260,800 S299.403 79.7% 2089 3217.700 S276.539 S317,471 32.4%
2020 '3205,487 $261,025 3299,661 79.7% 2090 3217,877 3276,764 $317,730 32.5%
2021 :5205,664 3261.250 3299,919 79.8% 2091 $218.054 $276,988 $317,988 82.5%
2022 3205.841 '5261,475 3300,177 79.8% 2092 $218,231 S277,213 3318,246 32.6%
2023 3206.018 3261.699 3300,436 79.8% 2093 3218,408 3277,438 S318,504 82.6%
2024 3206,195 3261.924 3300.694 79.9% 2094 3218,585 :3277,663 3318,762 32.6%
2025 3206.272 5262,.49 3300,952 79.9% 2095 5218,7 62 '3277,888 3319,020 32.7%
2026 '5206.549 5262.374 3301,210 30.0% 2096 '5218,939 5278,113 5319.278 82.7%
, ,Est.Current 2007 2010 Est. Current 2007 2010
Values Prjctn Prjctn %ile Values Prjctn Prjctn %ile
2237 $243,896 S309,815 S355,673 88.390 2307 S266,812 $338,924 $389,091 91.0%
2238 3244,073 $310,040 S355,931 88.3% 2308 S267,279 S339,518 $389,772 91.1%
2239 S244,250 $310,265 $356,189 88.4% 2309 S267,746 S340,111 $390,453 91.1%
2240 S244,427 $310,489 $356,447 88.4% 2310 $268,213 $340,704 S391,134 91.2%
2241 S244,604 $310,714 $356,705 88.4% 2311 $268,680 S341,297 $391,815 91.2%
2242 S244,781 $310,939 $356,964 88.5% 2312 S269,147 S341,891 3392,496 91.2%
2243 $244,958 $311,164 $357,222 88.5% 2313 $269,614 $342,484 3393,177 91.3%
2244 $245,135 $311,389 $357,480 88.6% 2314 $270,081 3343,077 $393,859 91.390
2245 $245,312 $311,614 $357,738 88.6% 2315 $270,548 $343,670 $394,540 91.4%
2246 $245,489 $311,838 $357,996 88.6% 2316 $271,015 5344,263 $395,221 91.4°0
2247 $245,666 $312,063 $358,254 88.7% 2317 $271,482 $344,857 $395,902 91.4%
2248 $245,843 $312,288 $358,512 88.7% 2318 $271,949 $345,450 $396,583 91.590
2249 $246,020 $312,513 $358,770 88.8% 2319 S272,416 3346,043 $397,264 91.5%
2250 $246,197 $312,738 $359,029 88.8% 2320 $272,883 S346,636 S397,945 91.6°0
2251 $246,374 $312,963 $359,287 88.8% 2321 S273,350 $347,230 3398,626 91.6%
2252 $246,551 $313,187 $359,545 88.9% 2322 $273,817 3347,823 $399,307 91.6%
2253 $246,728 $313,412 $359,803 88.9% 2323 $274,284 $348,416 $399,988. 91.7%
2254 $246,905 $313,637 $360,061 89.0% 2324 $274,751 $349,009 $400,669 91.7%
2255 3247,082 $313,862 $360,319 89.0% 2325 $275,218 $349,602 $401,350 91.8%
2256 $247,259 $314,087 $360,577 89.0% 2326 $275,685 $350,196 $402,031 91.890
2257 $247,436 $314,312 $360,835 89.1% 2327 $276,152 $350,789 $402,712 91.8%
2258 $247,613 $314,536 $361,093 89.1% 2328 $276,619 3351,382 $403,393 91.9%
2259 $247,790 $314,761 $361,352 89.1% 2329 $277,086 3351,975 S404,074 91.9%
2260 $247,967 $314,986 $361,610 89.2% 2330 $277,553 $352,568 $404,755 91.9%
2261 $248,144 $315,211 $361,868 89.2% 2331 S278,020 $353,162 $405,436 92.0%
2262 $248,321 $315,436 $362,126 89.3% 2332 $278,487 $353,755 $406,117 92.0%
2263 $248,498 $315,661 $362,384 89.3% 2333 $278.954 S354,348 S406,798 92.1%
2264 $248,675 $315,885 $362,642 89.3% 2334 S279,421 3354,941 S407,479 92.1%
2265 $248,852 $316,110 $362,900 89.4% 2335 $279,888 $355,535 S408,160 92.1%
2266 $249,029 $316,335 $363,158 89.4% 2336 $280,355 $356,128 $408,841 92.2%
2267 $249,206 $316,560 $363,417 89.5% 2337 $280,822 $356,721 $409,522 92.2%
2268 $249,383 $316,785 $363,675 89.5% 2338 $281,289 $357,314 $410,203 92.3%
2269 $249,560 $317,010 $363,933 89.5% 2339 $281,756 $357,907 $410,884 92.3%
2270 $249,737 $317,235 $364,191 89.6% 2340 $282,223 $358,501 $411,565 92.3%
2271 $249,914 $317,459 $364,449 89.6% 2341 $282,690 $359,094 $412,246 92.4%
2272 $250,467 $318,162 $365,255 89.7% 2342 $283,157 $359,687 $412,927 92.4%
2273 $250,934 $318,755 $365,936 89.7% 2343 $283,624 $360,280 $413,608 92.5%
2274 $251,401 $319,348 $366,618 89.7% 2344 $284,091 $360,874 $414,289 92.5%
2275 $251,868 $319,941 $367,299 89.8% 2345 $284,558 $361,467 $414,970 92.5%
2276 $252,335 $320,535 $367,980 89.8% 2346 $285,025 $362,060 3415,651 92.6%
2277 $252,802 $321,128 $368,661 89.9% 2347 $285,492 $362,653 $416,332 92.6%
2278 $253,269 $321,721 $369,342 89.9% 2348 $285,959 $363,246 $417,013 92.7%
2279 $253,736 $322,314 $370,023 89.9% 2349 $286,426 $363,840 $417,694 92.7%
2280 $254,203 $322,908 $370,704 90.0% 2350 $286,893 $364,433 $418,375 92.7%
2281 $254,670 $323,501 $371,385 90.0% 2351 $287,360 $365,026 $419,056 92.8%
2282 $255,137 $324,094 $372,066 90.1% 2352 $287,827 $365,619 $419,737 92.8%
2283 $255,604 $324,687 $372,747 90.1% 2353 $288,294 $366,212 $420,418 92.9%
2284 $256,071 $325,280 $373,428 90.1% 2354 $288,761 $366,806 $421,100_, 92.9%
2285 $256,538 $325,874 $374,109 90.2% 2355 $289,228 $367,399 $421,781 92.9%
2286 $257,005 $326,467 $374,790 90.2% 2356 $289,695 $367,992 $422,462 93.0%
2287 $257,472 $327,060 $375,471 90.3% 2357 $290,162 $368,585 $423,143 93.0%
2288 $257,939 $327,653 $376,152 90.3% 2358 $290,629 $369,179 $423,824 93.1%
2289 $258,406 $328,247 $376,833 90.3% 2359 $291,096 $369,772 $424,505 93.1%
•
2290 $258,873 $328,840 $377,514 90.4% 2360 $291,563 $370,365 $425,186 93.1
2291 $259,340 $329,433 $378,195 90.4% 2361 $292,030 5370,958 $425,867 93.290
2292 $259,807 $330,026 $378,876 90.4% 2362 $292,497 $371,551 $426,548 93.2%
2293 3260,274 3330,619 $379,557 90.5% 2363 $292,964 5372,145 $427,229 . 93.3%
2294 S260,741 S331,213 S380.238 90.5% 2364 3293,431 5372,738 $427,910 93.3%
2295 3261,208 '5331,806 3380,919 90.6% 2365 3293,898 $373,331 5428,591 93.3%
2296 $261,675 3'332.399 3381,600 90.6% 2366 $294,365 5373,924 3429.272 93.4%
2297 3262,142 S332,992 S382,281 90.6% 2367 3294,832 3374,518 3429.953 93.4%
2298 3262,609 3333,586 $382,962 90.7% 2368 3295,299 $375,111 3430,634 93.4%
2299 S263,076 3334,179 S383.643 90.7% 2369 S295,766 3375,704 $431,315 93.5%
2300 3263,543 S334,772 3384,324 90.8% 2370 S296,233 3376,297 3431.996 93.5%
2301 3264.010 3335,365 3'385,005 90.8% 2371 3296,700 3376,890 3432.677 93.69'0
2302 :S264.477 S335.958 '5385,686 90.8% 2372 3297,167 $377,484 S433,358 93.6%
2303 5264,944 $336,552 3386.367 90.9% 2373 $297,634 $378,077 $434,039 93.6%
2304 265,411 '3337,145 0387,048 90.9°% 2374 S298,101 $378,670 3434,7 20 93.7%
2305 5265.878 S337.738 :3387,729 2.1.0% 2375 S298,568 3379.263 `5435,401 93.7°%
2306 3266,345 3338,331 3388,410 91.0% 2376 $299.035 '3379.857 S436,082 93.8%
, Est.Current 2007 2010
Values Prjctn Prjctn %ile
2517 $500,005 $635,144 $729,156 98.9%
2518 $500,005 $635,144 $729,156 98.9%
2519 S500,005 5635,144 $729,156 98.9°0
2520 $500,005 $635,144 $729,156 98.9%
2521 $500,005 $635,144 $729,156 98.990
2522 $500,005 $635,144 $729,156 98.9%
2523 $500,005 $635,144 $729,156 98.9%
2524 $500,005 $635,144 $729,156 98.9%
2525 $500,005 $635,144 $729,156 98.9%
2526 $500,005 $635,144 $729,156 98.9%
2527 $500,005 $635,144 $729,156 98.9%
2528 $500,005 $635,144 $729,156 98.9%
2529 $500,005 $635,144 $729,156 98.9%
2530 $500,005 $635,144 $729,156 98.9%
2531 $500,005 $635,144 $729,156 98.9%
2532 $500,005 $635,144 $729,156 98.9%
2533 $500,005 $635,144 $729,156 98.9%
2534 $500,005 $635,144 $729,156 98.9%
• HOME Market Study: Support Data
Study Omaha
Area
Tenure
Occupied housing units: Total 26,909 156,858
Occupied housing units: Owner 16,263 60.4% 93,430 59.6%
occupied
Occupied housing units: Renter 10,646 39.6% 63,428 40.4%
occupied
Number of Bedrooms Per Unit
Housing units: Total 28,749 165,809
Housing units: No bedroom 439 1 .5% 5,299 3.2%
Housing units: 1 bedroom 3,212 11 .2% 30,877 18.6%
Housing units: 2 bedrooms 9,747 33.9% 43,355 26:1 %
Housing units: 3 bedrooms 11 ,158 38.8% 57,889 34,9%
Housing units: 4 bedrooms 3,430 11 .9% 22,873 13.8%
Housing units: 5 or more bedrooms 763 2.7% 5,516 3.3%
Number of Rooms Per Unit
Housing units: Total 29,202 165,809
Housing units: 1 room 285 1 .0% 4,101 2.5%
Housing units: 2 rooms 1 ,109 3.8% 8,508 5.1
Housing units: 3 rooms 2,297 7.9% 19,181 11 .6%
Housing units: 4 rooms 4,072 13.9% 23,861 14.4%
Housing units: 5 rooms •7,021 24.0% 30,148 18.2%
Housing units: 6 rooms 6,149 21 .1% 26,140 15.8%
Housing units: 7 rooms 4,070 13.9% 21 ,768 13.1
Housing units: 8 rooms 2,393 8.2% 15,909 9.6%
Housing units: 9 or more rooms 1,806 6.2% 16,193 9.8%
Age of Housing
Housing units: Total 28,749 165,809
Housing units: Built 1999 to March 144 0.5% 1,656 1 .0%
2000
Housing units: Built 1995 to 1998 416 1 .4% 5,893 3.6%
Housing units: Built 1990 to 1994 375 1.3% 7,657 4.6%
Housing units: Built 1980 to 1989 874 3.0% 16,262 9.8%
Housing units: Built 1970 to 1979 2,122 7.4% 31,866 19.2%
Housing units: Built 1960 to 1969 4,654 16.2% 30,236 18.2%
Housing units: Built 1950 to 1959 6,350 22.1% 23,276 14.0%
Housing units: Built 1940 to 1949 4,457 15.5% 12,676 7.69'0
Housing units: Built 1939 or earlier 9,357 32.5% 36,287 21 .9%
Units Per Residential Structure
Housing units: Total 28,749 165,809
Housing units: 1 ; detached units in 22,707 78.98% 104,415 63.0%
structure
Housing units: 1 : attached units in 789 2.74% 5,473
structure
Housing units: 2 units in structure 931 3.24% 4,256 2.6%
FINANCIAL STATUS REPORT FORM Exhibit P
(Please attach AIA G702 form and other supporting documentation for expenditures)
Subrecipient/Contractor: Program: CDBG
HOME
Address: (Circle) ESG
SHP
Grant#: Other
Grant Period:
Reimbursement Period: Project Type: Acquisition
(Circle all New Construction
that apply) Rehabilitation
CURRENT
GRANT FUNDS PROJECT TOTAL PREVIOUS MONTH'S % BUDGET
BUDGET EXPENDITURES EXPENDITURES COMPLETE REMAINING
Construction Hard Costs $ $ $ % $
Architect $ $ $ % $
Engineering $ $ $ % $
Legal $ $ $ % $
Appraisal $ $ $ % $
Audit $ $ $ % $
Developer Overhead $ $ $ % $
Construction Contingency $ $ $ % $
Other—Please Specify $ $ $ % $
$ $ $ % $
$ $ $ % $
$ $ $ % $
TOTALS $ $ $ % $
Reimbursement Requested: $
Program Income This Month $
TOTAL PAY REQUEST $
CURRENT
MATCHING FUNDS PROJECT TOTAL PREVIOUS MONTH'S % BUDGET
BUDGET EXPENDITURES EXPENDITURES COMPLETE REMAINING
Owner Cash Equity $ $ $ % $
LIHTC $ $ $ % $
Private Funds $ $ $ % $
Other $ $ $ % $
TOTAL MATCHING $ $ $ % $
I certify to the best of my knowledge that the above information is correct and complete and is for the purpose set forth in
the award documents. Financial records are available for audit or review.
Authorized Certifying Officer Title Date Form 3/01
Exhibit Q
PROTECTED AND DISADVANTAGED BUSINESS ENTERPRISE PROGRAMS
Who Qualifies as a Protected/Disadvantaged Business Enterprise?
The term "Protected Business Enterprises" (PBE) is defined to be a business at least 51 percent
of which is owned, controlled and actively managed by protected class members (Black,
Hispanic, Asian or Pacific Islander, American Indian or Alaskan Native or Female).
The term "Disadvantaged Business Enterprise" (DBE) is defined to be a small business that has
been in existence for at least one year and has annual gross receipts of$150,000 or less. A DBE
may include, but not limited to a business owned by a protected class, but such business must
meet two or other conditions set forth in the City of Omaha Contract Compliance Ordinance,
Section 10-191, M (1) through (5).
What are the benefits of becoming certified as a PBE/DBE?
Certification as a PBE or DBE provides greater exposure for work opportunities on City of
Omaha projects. The names of all certified PBE/DBE's appear in the PBE/DBE directory,which
is disseminated to local government agencies, contractors and to the public. City of Omaha
contractors will use the PBE/DBE directory as a basic resource for soliciting
Minority/Women/Small Business participation on City of Omaha projects. The City of Omaha
shall make every good-faith effort to award City contracts and City-assisted construction
contracts to Disadvantaged Business Enterprises in amounts no less than 10% of the dollar
volume of the applicable contracts awarded by the City. Other benefits include the authority(but
not a requirement), of the City Council to award a contract to a DBE that is not the lowest
bidder. A contract or subcontract can be awarded to a DBE if determined by the City to be an
acceptable cost higher than a competing lower bid except for specially assessed projects. A DBE
company may be awarded the contract over the lowest bidder as long as the cost differential does
not exceed 3%.
If your business is not certified with the City of Omaha and
you are interested in becoming certified as a Protected
and/or Disadvantaged Business Enterprise, please contact
the Human Relations Department at 402-444-5055. The
PBE/DBE applications, Contract Compliance Report Form
CC-1 and a current PBE/DBE City of Omaha certified
directory are located on the City of Omaha website.
www.ci.omaha.ne.us. Click on departments. Click on
Human Relations.
UTILIZATION OF PROTECTED AND/OR bidder fails to submit with the bid, the required
DISADVANTAGED BUSINESS ENTERPRISES information concerning PBE/DBE participation, or if,
having failed to meet the City of Omaha's goals or fails
A. Protected and/or Disadvantaged Business Enterprise to demonstrate to the City of Omaha's satisfaction the
(PBE/DBE) Participation Contract Specifications Pursuant bidder's good faith efforts to do so, the City of Omaha
to City of Omaha Contract Compliance Ordinance. may,in its discretion,reject the bid.
1. It is the policy of the City of Omaha that Protected 3. Protected and/or Disadvantaged Business Enterprise
and/or Disadvantaged Business Enterprises shall have Goals. Bidders are hereby informed that pursuant to
the maximum practicable opportunity to participate in Sec. 10-200 and Executive Order No. F 11 02 the City
the City of Omaha projects. Consequently, the of Omaha has a PBE Participation goal of no less than
PBE/DBE requirements of Contract Compliance 13% and a DBE participation goal of no less than 10%
Ordinance apply to this solicitation. In this regard, the of the dollar volume of all the contracts that it awards.
Contractor to whom any award of this solicitation is All bidders must make every good faith effort to meet
made shall take all necessary and reasonable steps in said goals.
accordance with this solicitation to ensure that
Protected and/or Disadvantaged Business Enterprises 4. The City of Omaha shall set specific goals for all
have the maximum opportunity to participate in the contracts over $200,000 to assist it in meeting its
Contract. The Contractor shall not discriminate on the overall PBE/DBE goals set forth above. The City of
basis of race, color,national origin, sex,religion, age or Omaha has established a PBE/DBE goal of!0%of the
disability in the award or performance of any contract dollar amount of the bid(Bid Total) for this contract(if
or subcontract resulting from or relating to this said contract is anticipated to be over $200,000).
solicitation. Failure to carry out the pre award Bidders shall make every good faith effort to meet said
requirements of these PBE/DBE specifications will be goal.
sufficient grounds to reject the Bid. Failure of the
5. Bidders are informed that price alone does not
Contractor to carry out the requirements of the
PBE/DBE specifications shall constitute a material constitute an acceptable basis for rejecting PBE/DBE
breach of the contract and may result in termination of bids unless the Bidder can demonstrate that no
the contract. The Contractor shall use its best efforts to reasonable price can be obtained from a PBE/DBE. A
carry out the PBE/DBE policy consistent with efficient Bidder's failure to meet the PBE/DBE goal or to show
reasonable efforts to that end will, in the City of
performance on the project.
Omaha's discretion, constitute sufficient ground for bid
2. Bidders are hereby informed that the City of Omaha has rejection. Such reasonable efforts may include, but are
established goals for the participation of Protected not limited to,some or all of the following:
and/or Disadvantaged Business Enterprise in all
contracts that it awards. Subcontracts awarded by the a. Attendance at the pre-bid conference,if any;
Bidder that is successful in this solicitation, to firms
b. Follow-up of initial solicitations of interest by
owned by Protected and/or Disadvantaged Business
Enterprises is essential to the achievement of the City contacting PBE/DBE's to determine with certainty
of Omaha's PBE/DBE goals. Therefore, to be whether the PBE/DBE's are interested;
considered for award, Bidders must comply with the
By c. Efforts made to select portions of the work
requirements of these PBE/DBE specifications.
submitting his/her bid, each Bidder gives assurance that (including where appropriate, breaking down
the contractor will meet the City of Omaha's percentage contracts into economically feasible units)
goals set forth in the PBE/DBE specifications for proposed to be performed by PBE/DBE's in order
participation by Protected and/or Disadvantaged to increase the likelihood of achieving the
Business Enterprises in the performance of any contract PBE/DBE goals;
resulting from the solicitation or, as an alternative, that
the contractor has made such efforts. Bidders must d. Efforts to negotiate with PBE/DBE's for specific
sub-bids,including at a minimum:
submit with their bids, on the form set forth in the
PBE/DBE specifications, the names, respective scope
of work, and the dollar values of each PBE/DBE (1) The names, addresses, type of work to be
subcontractor that the Bidder proposes for participation subcontracted and telephone numbers of
in the contract work. In any case,Exhibits"A"and"B" PBE/DBE's that were contracted;
must be submitted with the bid. If the information so (2) A description of the information provided to
submitted indicates that the City of Omaha goals will PBE/DBE's regarding the plans and
not be met, the Bidder shall submit good faith efforts specifications for portions of the work to be
documentation with their bid. The evidence must show performed; and
to the City of Omaha's satisfaction that the bidder has (3) A detailed statement of the reasons why
in good faith made every reasonable effort in the City additional prospective agreements with
of Omaha's judgment, to meet such goals. If any
PBE/DBE's needed to meet the stated goals must have been approved as such by the Human
were not reached. Relations Department prior to bid opening on the
project.
e. Advertisement in general circulation media, trade
association publications and protected-focus media e. After bid opening and during contract performance,
for a reasonable period before bids are due; Bidders and the Contractor, as the case may be, are
required to make every reasonable effort to replace
£ Notification in writing to a reasonable number of a PBE/DBE subcontractor that is determined to be
specific PBE/DBE's that their interest in contract unable to perform successfully or is not performing
work is solicited, in sufficient time to allow the satisfactorily with another PBE and/or DBE prior
PBE/DBE's to participate effectively; to substituting such PBE/DBE,the Contractor shall
seek approval from the Human Relations
g. Concerning each PBE/DBE the Bidder contacted Department. The City of Omaha's Human
but rejected as unqualified, the reasons for the Relations Depai Intent Director or a designee shall
Bidder's conclusion; approve all prior substitutions in writing in order to
ensure that the substituted firms are bona fide
h. Efforts made to assist the PBE/DBE's contacted PBE/DBE's.
that needed assistance in obtaining bonding, lines
of credit or insurance required by the Bidder or the f. In the event of the Contractor's noncompliance
City of Omaha; with the Protected and/or Disadvantaged Business
Enterprise requirements of this Contract, The City
i. Designation in writing of a liaison officer who of Omaha shall imposes such contract sanctions as
administers the Bidder's Protected and/or it may determine to be appropriate, including, but
Disadvantaged Business Enterprise utilization not limited to:
program;
(1) Rejection of the Bid
j. Expansion of search for PBE/DBE's to a wider (2) Withholding of payments to the Contractor
geographic area than the area in which the Bidder until the Contractor complies;and/or
generally seeks subcontractors if use of the (3) Cancellation, termination or suspension of the
customary solicitation area does not result in Contract,in whole or in part;or
meeting the goals by the Bidder;and, (4) Any other penalty set forth in the City of
Omaha's Contract Compliance Ordinance.
k. Utilization of services of available protected
community organizations, protected contractor's 7. For the information of Bidders, Contract Compliance
group, local, state and federal minority business Ordinance outlines the City of Omaha's rules,
assistance offices, and other organizations that guidelines and criteria for(a)making determinations as
provide assistance in the recruitment and to the legitimacy of PBE/DBE's, (b) ensuring that
placement of PBE/DBE's. contracts are awarded to Bidders that meet PBE/DBE
goals.
6. The Bidder must comply with the following:
8. The Bidder/Contractor shall cooperate with the Human
a. Prior to award of this Contract, all Bidders shall Relations Department in any reviews of the
submit Exhibit "A" Protected and/or Bidder/Contractor's procedures and practices with
Disadvantaged Business Disclosure Participation respect to the Protected and/or Disadvantaged Business
Form. Exhibit"A"must be submitted with the bid. Enterprise which the Human Relations Depaitinent may
Bidder must also submit a copy of the written bid from time to time conduct.
submitted by the PBE/DBE subcontractor to the
Bidder or other verification in writing from the B. PBE/DBE Reporting and Record Keeping Requirements.
PBE/DBE subcontractor that said subcontractor has
agreed to perform the subcontracting work 1. The Contractor shall submit periodic reports of
identified in the bid submitted by the Bidder. contracting with Protected and/or Disadvantaged
Business Enterprises in such form and manner and at
b. If Bidder fails to meet the goals set forth above, such time as prescribed by the City of Omaha (Exhibit
Good Faith Efforts Documentation must be "C" is currently required to be submitted within ten
submitted with bid. (10) calendar days following the end of each calendar
quarter,from the start of the project).
c. Also, prior to award of this contract, all Bidders
must submit Exhibit `B" Contractor Employment 2. The Contractor and subcontractors shall permit
Data Form with the bid. access to their books, records and accounts by
the Human Relations Director or a designated
d. The Bidder and any of its subcontractors that have representative for purpose of investigation to
been designated by the Bidder as PBE and/or DBE ascertain compliance with these specified
requirements. Such requirements shall be
maintained by the Contractor in a fashion that
is readily accessible to the City of Omaha for a
minimum of three (3) years following
completion of this Contract.
3. To ensure that all obligations under any
contract awarded as a result of this bid
solicitation are met, the City of Omaha will
conduct specific reviews of the Contractor's
PBE/DBE involvement efforts during contract
performance. The Contractor shall bring to the
attention of the Human Relations Director any
situation in which regularly scheduled
progress payments are not made to PBE/DBE
subcontractors.
In submitting its bid, the Bidder is certifying that is has
contacted City of Omaha Human Relations Department prior to
bid opening regarding this project and has afforded
subcontractors participating in the PBE/DBE program the
opportunity to submit bids on this project. Failure to comply
with the above shall result in the bid being rejected by the City
of Omaha.
EXHIBIT "A"
PROTECTED AND/OR DISADVANTAGED BUSINESS
DISCLOSURE PARTICIPATION FORM
THIS FORM MUST BE SUBMITTED WITH THE BID
In the performance of this contract,the contractor proposes and agrees to make good faith efforts to contract with eligible City of
Omaha certified PBE and/or DBE's. Should the below listed PBE and/or DBE subcontractor be determined to be unable to
perform successfully or is not performing satisfactorily, the Contractor shall obtain prior approval from the Human Relations
Department Director or a designee,for substitution of the below listed subcontractor with a City of Omaha certified PBE and/or
DBE. In submitting this form,the Bidder is certifying that it has contacted City of Omaha Human Relations Department prior to
bid opening regarding this project and has afforded subcontractors participating in the program the opportunity to submit bids on
this project.
Type of work and Projected
contract item to be commencement
Name of PBE performed and completion *Agreed price
and/or DBE Address date of work with PBE/DBE's Percentage(%)
TOTALS
*Dollar value of each PBE/DBE agreement must be listed in the "Agreed Price" column; total in this column must equal the
PBE/DBE goals.
CERTIFICATION
The Undersigned/Contractor certifies to the City of Omaha that the utilization goals will be met either by goal achievement or
good faith effort as documented. The Undersigned/Contractor certifies that he/she has read, understands and agrees to be bound
by PBE/DBE Participation Contract Specifications, including the accompanying Exhibits regarding PBE/DBE and the other
terms and conditions of the Invitation for Bids. The undersigned further certifies that he/she is legally authorized by the Bidder
to make the statements and representations in the PBE/DBE Participation Contract Specifications and that said statements and
representations are true and correct to the best of his/her knowledge and belief. The undersigned will enter into formal
agreement(s)with Protected and/or Disadvantaged business enterprise(s)(which are otherwise deemed by the City of Omaha to
be technically responsible to perform the work) listed in the PBE/DBE Specifications at the price(s) set forth in Exhibit "A"
conditioned upon execution of a contract by the undersigned with the City of Omaha. The Undersigned Contractor agrees that if
any of the PBE/DBE Specification representations are made by the bidder knowing them to be false,or if there is a failure by the
successful bidder(i.e.,the Contractor)to implement the stated agreements, intentions, objectives, goals and comments set forth
herein without prior approval of the Director of the Human Relations Department, such action shall constitute a material breach
of the contract,entitling the City of Omaha to reject the contractors bid or to terminate the Contract for default. The right to so
terminate shall be in addition to,and not in lieu of, any other rights or remedies the City of Omaha may have for other defaults
under the Contract under City of Omaha's Contract Compliance Ordinance or otherwise. Additionally, the
Undersigned/Contractor will be subject to the terms of any future Contract Awards.
Signature
Title Date of Signing
Firm or Corporate Name
Telephone Number
Address P
EXHIBIT"B"
CONTRACTOR EMPLOYMENT DATA
BIDDERS ARE REQUIRED TO SUBMIT THE FOLLOWING WORK FORCE DATA WITH EACH BID
(Protected Class is defined as Black,Hispanic,Asian and Pacific Islander,American Indian or Alaskan Native,Female)
Total Employees Protected Class Males Protected Class Females
Asian American Asian American
Total Total or Indian or or Indian or
Work Protected Pacific Alaskan Pacific Alaskan
Date Force Class Black Hispanic Islander Native Black Hispanic Islander Native White
Refer any questions regarding the BID or SPECIFICATIONS directly to the Purchasing Department(402) 444-5400 or as shown on
bid. All bidders awarded a contract in the amount of$5,000 or more must comply with the Contract Compliance Ordinance and have
on file with the Human Relations Department the Contract Compliance Report (Form CC-1). This report shall be in effect for 24
months from the date received by the Human Relations Department. Any questions regarding the Contract Compliance Ordinance
should be directed to the Human Relations Department at(402)444-5055.
(PLEASE PRINT LEGIBLY OR TYPE)
Firm's Name:
(Date of Signing)
Signature:
(Print Name) (Title) (Signature)
EXHIBIT "C"
QUARTERLY REPORT ON PROTECTED AND/OR
DISADVANTAGEDBUSINESS ENTERPRISES
(This form must be submitted within ten (10) calendar days of the end of each calendar
quarter, from the start of the project)
Company Name:
Project Number:
Project Name:
Total Contract Amount:
Calendar Quarter
Covered by this Report:
1st 3rd
2nd 4th
Year 200_
1. Protected and/or Disadvantaged Contractors
Instructions: List all Protected and/or Disadvantaged Sub-contractors which have performed work since
Notice to Proceed (NTP), are currently performing work, and are contemplated to perform work during the
duration of the City of Omaha Contracts. Name and total dollars committed and paid.
Name of Protected
And/or Disadvantaged Dollars Paid During Dollars Paid Since
Business Enterprise Work Assignment Dollars Committed Quarter (NTP)to Date
Exhibit R
SOIL WORK POLICY
FEDERAL CDBG, HOME, ECONOMIC DEVELOPMENT INITIATIVE AND
NEIGHBORHOOD INITIATIVE PROGRAMS
Housing Development Programs
The City of Omaha operates several housing development programs with federal funds from the
Community Development Block Grant, HOME Investment Partnerships Program, Economic
Development Initiative Grant and Neighborhood Initiative Grant Programs. The City's housing
development programs may involve the removal of structures, installation of public infrastructure and site
preparation work prior to the construction of new residential structures by developers.
The Governor has made a request to the U.S. Environmental Protection Agency (EPA) to declare a
portion of the eastern part of Omaha a Superfund Site as a result of high concentrations of lead in the soil.
The area in question is generally bound by , subject to the actual testing of individual lots.
POLICY:
The soil work requirements for housing development projects involving the removal of structures,
installation of public infrastructure and/or site preparation work within the Superfund Site area as follows:
The lead content of the soil on the property will be determined by laboratory analysis
using either flame or furnace atomic absorption spectroscopy. Laboratories performing
analysis for lead in soil will be certified by the National Lead Laboratories Accreditation
Program (NLLAP) by mandatory participation in the Environmental Lead Proficiency
Analytical Testing (ELPAT)program. Lead content will be reported as parts per million
(ppm).
Should any of the soil samples report a lead concentration greater than 400 ppm, the
affected soil will be removed to a depth where the soil samples report a lead
concentration of less than 400 ppm or to a depth of one foot below the finished grade,
whichever depth is less.
In addition to requirements for soil integrity used for structural fill, all soil brought onto
the property must be tested for environmental contaminants. Borrow soils used for
purposes other than for structural fill, such as finish grade, topsoil or surcharge, are
required to be tested in the same manner for environmental contaminants. The contractor
will inform the City of the location of borrow soil no less than ten days prior to its use on
the property. Testing will include the collection of not less than three samples per borrow
site. The City and/or its designated representative will complete soil sample collection.
Should any of the soil samples report a lead concentration greater than 400 ppm, the soil
will not be allowed for use on housing development program properties.
Effective 9/1/2002
24 CFR 85.43 ENFORCEMENT Exhibit S
(a) Remedies for non-compliance. If a grantee or sub-grantee materially fails to comply with
any term of an award, whether stated in a federal statute or regulation, an assurance, in a
State plan or application, a notice of award, or elsewhere, the awarding agency may take one
or more of the following actions, as appropriate in the circumstances:
(1) Temporarily withhold cash payments pending correction of the deficiency by the grantee
or sub-grantee or more severe enforcement action by the awarding agency,
(2) Disallow (that is, deny both use of funds and matching credit for) all or part of the cost of
the activity or action not in compliance,
(3) Wholly or partly suspend or terminate the current award for the grantee's or sub-
grantee's program,
(4) Withhold further awards for the program, or
(5) Take other remedies that may be legally available.
(b) Hearings, appeals. In taking an enforcement action, the awarding agency will provide the
grantee or sub-grantee an opportunity for such hearing, appeal or other administrative
proceeding to which the grantee or sub-grantee is entitled under any statute or regulation
applicable to the action involved.
(c) Effects of suspension and termination. Costs of grantee or sub-grantee resulting from
obligations incurred by the grantee or sub-grantee during a suspension or after termination of
an award are not allowable unless the awarding agency expressly authorizes them in the
notice of suspension or termination or subsequently. Other grantee or sub-grantee costs
during suspension or after termination which are necessary and not reasonably avoidable are
allowable if:
(1) The costs result from obligations which were properly incurred by the grantee or sub-
grantee before the effective date of suspension or termination, are not in anticipation of it,
and, in the case of a termination, are non-cancellable, and,
(2) The costs would be allowable if the award were not suspended or expired normally at the
end of the funding period in which the termination takes effect.
(d) Relationship to Debarment and Suspension. The enforcement remedies identified in this
section, including suspension and termination, do not preclude grantee or sub-grantee from
being subject to "Debarment and Suspension"under EO 12549 (see § 85.35).
24 CFR 85.44 TERMINATION FOR CONVENIENCE
Except as provided in § 85.43 awards may be terminated in whole or in part only as follows:
(a) By the awarding agency with the consent of the grantee or sub-grantee in which case the two
parties shall agree upon the termination conditions, including the effective date and in the
case of partial termination, the portion to be terminated, or
(b) By the grantee or sub-grantee upon written notification to the awarding agency, setting forth
the reasons for such termination, the effective date, and in the case of partial termination, the
portion to be terminated. However, if, in the case of a partial termination, the awarding
agency determines that the remaining portion of the award will not accomplish the purposes
for which the award was made, the awarding agency may terminate the award in its entirety
under either § 85.43 or Paragraph(a) of this section.
Attachment 1
CITY OF OMAHA
DEFINITION OF INCOME
Annual Income Includes:
1. Wages, salaries, tips, commissions, etc.:
2. Self-employment income from owned non-farm business, including proprietorships and partnerships;
3. Farm self-employment income;
4. Interest, dividends,net rental income, or income from estates or trusts
5. Social security or railroad retirement;
6. Supplemental Security Income, Aid to Families with Dependent Children, or other public assistance
or public welfare programs;
7. Retirement, survivor or disability pensions;
8. Any other sources of income received regularly including Veterans' (VA) payments, unemployment
compensation, child support and alimony; and
9. Income from assets, as shown below:
a. amounts in savings certificates,money market funds and other investment accounts.
b. stocks,bonds, savings certificates,money market funds and other investment accounts.
c. equity in real property or other capital investments. Equity is the estimated current market value
of the asset less the unpaid balance on all loans secured by the asset and reasonable costs(such as
broker fees) that would be incurred in selling the asset. Do not include equity in principle
residence(home equity).
d. the cash value of trusts that are available to the household.
e. IRA, Keogh and similar retirement savings accounts, even though withdrawal would result in a
penalty.
f. contributions to company retirement/pension funds that can be withdrawn without retiring or
terminating employment.
g. assets which, although owned by more than one person, allow unrestricted access by the
applicant.
h. lump sum receipts such as inheritances, capital gains, lottery winnings, insurance settlements and
other claims.
i. personal property held as an investment such as gems,jewelry, coin collections, antique cars,etc.
j. cash value of life insurance policies.
k. assets disposed of for less than fair market value during two years preceding certification or re-
certification.
10. Actual income from assets if total assets are $5,000 or less.
11. If assets are more than $5,000, the greater of(a) actual income from assets, or (b) total assets times
passbook rate.
Annual Income Does Not Include the Following Assets:
1. necessary personal property, except as noted in 9 (i).
2. interest in Indian trust lands.
3. assets that are a part of an active business or farming operation. NOTE: Rental properties are
considered personal assets held as an investment rather than business assets unless real estate is the
applicant's/tenant's main occupation.
4. assets not accessible to the family and which provide no income for the family.
5. vehicles especially equipped for the handicapped.
6. equity in owner-occupied cooperatives and manufactured homes in which the family lives.
7. equity in principle residence(home equity).
Revised 10/8/99
Attachment "2"
EQUAL EMPLOYMENT OPPORTUNITY CLAUSE
During the performance of this Contract, the Contractor agrees as follows:
(1) The Contractor and its subcontractors shall not discriminate against any employee
or applicant for employment because of race, religion, color, sex, age, national
origin, handicap or familial status. As used herein, the work "treated" shall mean
and include, without limitation, the following: Recruited, whether by advertising
or by other means; compensated; selected for training, including apprenticeship;
promoted; upgraded; demoted; downgraded; transferred; laid off; and terminated.
The Contractor agrees to and shall post in conspicuous places, available to
employees and applicants for employment, notices to be provided by the
contracting officers setting forth the provisions of this nondiscrimination clause.
(2) The Contractor and its subcontractors shall, in all solicitations or advertisements
for employees placed by or on behalf of the Contractor, state that all qualified
applicants will receive consideration for employment without regard to race,
religion, color, sex, national origin, age, handicap or familial status.
(3) The Contractor and its subcontractors shall send to each representative of workers
with which he has a collective bargaining agreement or other contract or
understanding a notice advising the labor union or worker's representative of the
Contractor's commitments under the equal employment opportunity clause of the
City and shall post copies of the notice in conspicuous places available to
employees and applicants for employment.
(4) The Contractor and its subcontractors shall furnish to the City's Human Relations
Director all federal forms containing the information and reports required by the
federal government for federal contracts under federal rules and regulations,
including the information required by Omaha Municipal Code Sections 10-192 to
10-194, inclusive, and shall permit reasonable access to his records. Records
accessible to the Human Relations Director shall be those which are related to
Paragraphs (1) through (7) of this subsection and only after reasonable notice is
given to the Contractor. The purpose for this provision is to provide for
investigation to ascertain compliance with the program provided for herein.
(5) The Contractor and its subcontractors shall take such actions with respect to any
subcontractor as the City may direct as a means of enforcing the provisions of
Paragraphs (1) through (7) herein, including penalties and sanctions for
noncompliance; however, in the event the Contractor becomes involved in or is
threatened with litigation as the result of such directions by the City, the City will
enter into such litigation as is necessary to protect the interests of the City and to
effectuate the provisions of this division; and in the case of contracts receiving
federal assistance, the Contractor or the City may request the United States to
enter into such litigation to protect the interests of the United States.
(6) The Contractor shall file and shall cause his subcontractors, if any, to file
compliance reports with the Contractor in the same form and to the same extent as
required by the federal government for federal contracts under federal rules and
regulations. Such compliance reports shall be filed with the Human Relations
Director. Compliance reports filed at such times as directed shall contain
information as to the employment practices, policies, programs and statistics of
the Contractor and his subcontractors.
(7) The Contractor shall include the provisions of Paragraphs (1) through (7) of this
Section, "Equal Employment Opportunity Clause", and Omaha Municipal Code
Section 10-193 in every contract, subcontract or purchase order so that such
provisions will be binding upon each subcontractor or vendor. (Code 1980,
Section 10-192; Ordinance No. 35344, Sections 1, 9-26-00)
Attachment 3
SECTION 3 CLAUSE
All Section 3 covered contracts shall include the following clause (referred to as the Section 3
clause):
A. The work to be performed under this contract is subject to the requirements of Section 3
of the Housing and Urban Development Act of 1968, as amended, 12 U.S.C. 1701u
(Section 3). The purpose of Section 3 is to ensure that employment and other economic
opportunities generated by HUD assistance or HUD-assisted projects covered by Section
3 shall, to the greatest extent feasible, be directed to low- and very low-income persons,
particularly persons who are recipients of HUD assistance for housing.
B. The parties to this contract agree to comply with HUD's regulations in 24 CFR part 135,
which implement Section 3. As evidenced by their execution of this contract, the parties
to this contract certify that they are under no contractual or other impediment that would
prevent them from complying with the part 135 regulations.
C. The contractor agrees to send to each labor organization or representative of workers with
which the contractor has a collective bargaining agreement or other understanding, if any,
a notice advising the labor organization or workers' representative of the contractor's
commitments under this Section 3 clause, and will post copies of the notice in
conspicuous places at the work site where both employees and applicants for training and
employment positions can see the notice. The notice shall describe the Section 3
preference, shall set forth minimum number and job titles subject to hire, availability of
apprenticeship and training positions, the qualifications for each; and the name and
location of the person(s) taking applications for each of the positions; and the anticipated
date the work shall begin.
D. The contractor agrees to include this Section 3 clause in every subcontract subject to
compliance with regulations in 24 CFR part 135, and agrees to take appropriate action, as
provided in an applicable provision of the subcontract or in this Section 3 clause, upon a
finding that the subcontractor is in violation of the regulations in 24 CFR part 135. The
contractor will no6t subcontract with any subcontractor where the contractor has notice or
knowledge that the subcontractor has been found in violation of the regulations in 24
CFR part 135.
E. The contractor will certify that any vacant employment positions, including training
positions, that are filled (1) after the contractor is selected but before the contract is
executed, and (2) with persons other than those to whom the regulations of 24 CFR part
135 require employment opportunities to be directed were not filled to circumvent the
contractor's obligations under 24 CFR part 135.
F. Noncompliance with HUD's regulations in 24 CFR part 135 may result in sanctions,
termination of this contract for default, and debarment or suspension from future HUD-
assisted contracts.
G. With respect to work performed in connection with Section 3 covered Indian housing
assistance, Section 7(b) of the Indian Self-Determination and Education Assistance Act
(25 U.S.C. 450e) also applies to the work to be performed under this contract. Section
7(b) requires that to the greatest extent feasible (i) preference and opportunities for
training and employment shall be given to Indians, and (ii) preference in the award of
contracts and subcontracts shall be given to Indian organizations and Indian-owned
Economic Enterprises. Parties to this contract that are subject to the provisions of
Section 8 and Section 7(b) agree to comply with Section 3 to the maximum extent
feasible,but not in derogation of compliance with Section 87 (b).
Providing Other Economic Opportunities.
(a) General. In accordance with the findings of the Congress, as stated in Section 3,
that other economic opportunities offer an effective means of empowering low-
income persons, a recipient is encouraged to undertake efforts to provide to low-
income persons economic opportunities other than training, employment and
contract awards, in connection with Section 3 covered assistance.
(b) Other training and employment-related opportunities. Other economic opportunities
to train and employ Section 3 residents include, but need not be limited to, use of
"upward mobility", "bridge" and trainee positions to fill vacancies; and hiring
Section 3 residents in part-time positions.
(c) Other business-related economic opportunities: (1) A recipient or contractor may
provide economic opportunities to establish, stabilize or expand Section 3 business
concerns, including micro-enterprises. Such opportunities include, but are not
limited to formation of Section 3 joint ventures, financial support for affiliating with
franchise development, use of labor only contracts for building trades, purchase of
supplies and materials from housing authority resident-owned businesses, purchase
of materials and supplies from PHA resident-owned businesses and use of
procedures under 24 CFR part 963 regarding HA contracts to HA resident-owned
businesses. A recipient or contractor may employ these methods directly or may
provide incentives to non-Section 3 businesses to utilize such methods to provide
other economic opportunities to low-income persons. (2) A Section 3 joint venture
means an association of business concerns, one of which qualifies as a Section 3
business concern, formed by written joint venture agreement to engage in and carry
out a specific business venture for which purpose the business concerns combine
their efforts, resources and skills for joint profit, but not necessarily on a continuing
or permanent basis for conducting business generally, and for which the Section 3
business concern:
(i) Is responsible for a clearly defined portion of the work to be performed and
holds management responsibilities in the joint venture; and
(ii) Performs at least 25 percent of the work and is contractually entitled to
compensation proportionate to its work.
Attachment 4
MINORITY BUSINESS & WOMEN BUSINESS
ENTERPRISE PLAN
October 2001
PLANNING DEPARTMENT
CITY OF OMAHA
MINORITY BUSINESSWOMEN BUSINESS ENTERPRISE PLAN
INTRODUCTION
Minority and women business sectors play an important part in Omaha's overall plans for future growth,
progress, and prosperity. It is vital to the City's economic condition and well-being that minority and
women businesses expand, thrive and prosper, generating economic stability and increased job
opportunities. Towards the fulfillment and accomplishment of these important objectives, the City of
Omaha remains committed to minority and women business development.
The City of Omaha's approach to minority/women business development is embedded in its policy of non-
discrimination in the conduct of City business including the procurement of goods, materials and services,
construction and community and economic development projects. The City recognizes its obligations to
each segment of the various communities it serves. It is in recognition of these responsibilities that the
City established the City's Contract Compliance Ordinance.
The Ordinance commits the City to:
1. Require contractors and/or vendors to provide employment opportunities without regard to race,
creed, color, sex religion, or national origin;
2. Monitor contractor and vendor equal opportunity performance; and
3. Increase the total number and total dollar volume of City contracts awarded to minority-owned and
women-owned firms.
GOALS AND OBJECTIVES
The following represents a summary of the goals and objectives of the Planning Department as they relate
to minority and women-owned businesses:
1. Encourage, increase and promote business and procurement opportunities for women-owned
businesses;
2. Increase and expand the awareness and understanding regarding the concerns, obstacles, and
hindrances preventing increased MBE/WBE participation in Planning Department activities;
3. Assist MBE's/WBE's through the revitalization of business districts;
4. Assist minority and female entrepreneurs in the formation and growth of new small businesses;
and
5. Provide technical assistance to neighborhood organizations, MBE's and WBE's to increase their
participation in the Planning Department programs and activities at all levels.
SCOPE OF WORK
In order to accomplish these objectives, the Planning Department will:
1. Require that recipients of grant awards, consulting contracts, or loans to develop and provide a
MBE/WBE Utilization Plan.
2. Ensure that Requests for Proposals require the submission of MBE/WBE Utilization Plans.
1
3. Ensure that the programs of the Planning Department are advertised in the appropriate new media
whose markets are targeted toward MBE/WBE.
4. Implement an outreach effort informing MBE and WBE firms and capture information on these
firms doing business with the Planning Department.
5. Implement a system to identify MBE and WBE firms and capture information on these firms doing
business with the Planning Department.
6. Require developers, corporations, partnerships and/or sole proprietors to register with the Human
Relations Department and the Purchasing Department. In addition, require these entities to:
A. Complete CC-1 (Human Relations Department)
B. Complete Bid List Registration (Finance Department, Purchasing Division
C. Complete Business Certification(Human Relations Department)
7. Require developers, corporations, partnerships and/or sole proprietors to provide registration
information on all sub-contractors.
8. Require loan agreements to include a statement that jobs created will be made available to low-to-
moderate income persons.
The following application package has been developed to assist you in complying with our request for
information on your business and all sub-contractors providing goods and/or services on projects financed
by and/or implemented through an agreement with the City of Omaha. If you have any questions or
require further assistance in completing the application package, please contact Mr. Kenneth Johnson, Sr.
at 444-5165.
2
MBE/WBE FOR EMPLOYMENT
The following list of organizations is provided to assist you in identifying low-to-moderate income
persons for employment opportunities. You must make concerted efforts to hire low-to-moderate income
persons and document specific actions taken to achieve these objectives.
To help accomplish the above goals, the following agencies should be notified of initial employment
opportunities for low to moderate income persons:
Omaha Work Force Development Employment YWCA
Services 222 South 29th Street
2421 North 24th Street Omaha,NE 68131
Omaha,NE 68111 Peg Harriott, Executive Director
444-4700 345-6555
Work Force Development of Greater Omaha Omaha Opportunities Industrialization Center
Blue Lion Centre 2724 North 24th Street
2421-23 North 24th Street Omaha,NE 68110
Omaha, NE 68110 Dr. Bernice Dodd, Executive Director
Ola Anderson, Director 457-4222
444-3510
Urban League of Nebraska, Inc. Girls Incorporated of Omaha
3022-24 North 24th Street 2811 North 45th Street
Omaha, NE 68110 Omaha,NE 68104
Marilyn McGary, President Miss Roberta, Executive Director
453-9730 457-4676
3
MBE/WBE FOR GOODS AND SERVICES
Your company must make vendors aware of your policy to support equal opportunity utilization of
minority, disabled and women-owned businesses. To accomplish this goal, you must provide a copy of
the approved MBE/WBE Participation Plan to all businesses providing goods and/or services to the
project.
Your company must provide the opportunity for Minority Business Enterprises and Women Business
Enterprises to provide goods and services through all phases of the project. A concerted effort must be
made to allow these businesses to actively compete for project contracts. This effort will include
utilization of the following resources and documentation of your actions to achieve these objectives.
Omaha Small Business Network, Inc.
2505 North 24th Street
Omaha, NE 68110
Executive Director
453-5336
Housing and Community Development Division
City Planning
1819 Farnam Street, Room 1111
Omaha,NE 68183
Kenneth E. Johnson, Sr., Economic Development Manager
444-5165
Nebraska Department of Economic Development
Small Business (MBE/WBE/DBE) Assistance
301 Centennial Mall South
Lincoln,NE 68509-4666
Steve Williams, Business Assistance Manager
471-3778
Purchasing Department
1819 Farnam Street, Room 1003
Omaha, NE 68183
John Leming, Purchasing Agent
444-5407
Human Relations Department Gail Kinsey Thompson, Director(444-5050)
Contract Compliance (MBE/WBE)
1819 Farnam Street, Room 502
Omaha, NE 68183
4
MBE/WBE FOR GOODS AND SERVICES
Great Plains Minority Supplier Development Council
Greater Omaha Chamber of Commerce
1301 Harney Street
Omaha,NE 68102
Terrie Miller, Director
345-5000
United Minority Contractors Association
2221 North 24th Street
Omaha,NE 68110
Al Epps, Executive Director
341-2177
Kathleen Piper, ADD/MED
Small Business Administration
11145 Mill Valley Road
Omaha, NE 68154
221-7205
Hubert J. Carter, Jr., Deputy for Small Business
U.S. Corps of Engineers
215 North 17th Street
Omaha, NE 68102
221-4110
5
City of Omaha
BUSINESS QUALIFICATION RESUME
DATE:
I. FIRM IDENTIFICATION:
COMPANY NAME
STREET ADDRESS
CITY STATE ZIP CODE
BUSINESS PHONE HOME PHONE
MONTH &YEAR ESTABLISHED
II. OWNERSHIP OF FIRM:
IS THE FIRM OWNED AND CONTROLLED BY MEMBER OF MINORITY OR OTHER
DISADVANTAGED GROUP?: YES ❑ NO ❑ MINORITY ❑
WOMAN ❑ N/A ❑
TYPE OF OWNERSHIP: INDIVIDUAL ❑ PARTNERSHIP ❑ CORPORATION ❑
IS 51% OWNED BY A MINORITY? YES ❑ NO ❑
NAME AND ADDRESS OF ALL STOCKHOLDERS AND/OR PARTNERS:
NAME, TITLE, HOME ADDRESS % OF OWNERSHIP
III. MANAGEMENT (USE SAME FORMAT FOR ADDITIONAL MANAGEMENT PERSONNEL):
NAME POSITION
EDUCATION
MANAGEMENT OR TECHNICAL TRAINING
6/22/90
6
City of Omaha
CONTRACTOR INFORMATION FORM:
DATE: PROJECT ADDRESS
OWNER INFORMATION: (To be filled out by the City of Omaha)
OWNER'S NAME
OWNER'S ADDRESS
CITY/STATE/ZIP CODE
OWNER'S PHONE NUMBER
OWNER'S FEDERAL TAX IDENTIFICATION NUMBER: MINORITY INFORMATION:
The Owner meets the following criteria:
MINORITY ❑ WOMAN ❑ N/A ❑
(If the company does not have a Federal Tax Identification
Number, then provide the Owner's Social Security Number.)
GENERAL CONTRACTOR INFORMATION:
COMPANY'S NAME
COMPANY'S ADDRESS
CITY/STATE/ZIP CODE
COMPANY'S PHONE NUMBER
COMPANY'S FEDERAL TAX IDENTIFICATION NUMBER: MINORITY INFORMATION:
The Company meets the following criteria:
MINORITY ❑ WOMAN ❑ N/A ❑
CONTRACT AMOUNT:
SUBCONTRACTOR LIST:
SUBCONTRACTOR TRADE FED. I.D. # TELEPHONE# MINORITY INFO.:
❑ MINORITY
❑ WOMAN
CONTRACT AMOUNT: ❑ N/A
SUBCONTRACTOR TRADE FED. I.D. # TELEPHONE# MINORITY INFO.:
❑ MINORITY
❑ WOMAN
CONTRACT AMOUNT: ❑ N/A
City of Omaha
SUBCONTRACTOR LIST:
(Continuation)
SUBCONTRACTOR TRADE FED. I.D. # TELEPHONE# MINORITY INFO.:
❑ MINORITY
❑ WOMAN
CONTRACT AMOUNT: ❑ N/A
SUBCONTRACTOR TRADE FED. I.D. # TELEPHONE# MINORITY INFO.:
E MINORITY
❑ WOMAN
CONTRACT AMOUNT: El N/A
SUBCONTRACTOR TRADE FED. I.D. # TELEPHONE# MINORITY INFO.:
El MINORITY
❑ WOMAN
CONTRACT AMOUNT: ❑ N/A
SUBCONTRACTOR TRADE FED. I.D. # TELEPHONE# MINORITY INFO.:
❑ MINORITY
❑ WOMAN
CONTRACT AMOUNT: ❑ N/A
SUBCONTRACTOR TRADE FED. I.D. # TELEPHONE# MINORITY INFO.:
❑ MINORITY
❑ WOMAN
CONTRACT AMOUNT: ❑ N/A
SUBCONTRACTOR TRADE FED. I.D. # TELEPHONE# MINORITY INFO.:
❑ MINORITY
❑ WOMAN
CONTRACT AMOUNT: ❑ N/A
SUBCONTRACTOR TRADE FED. I.D. # TELEPHONE # MINORITY INFO.:
❑ MINORITY
❑ WOMAN
CONTRACT AMOUNT: El N/A
SUBCONTRACTOR TRADE FED. I.D. # TELEPHONE# MINORITY INFO.:
❑ MINORITY
❑ WOMAN
CONTRACT AMOUNT: ❑ N/A
8
Attachment 5
covam,NF
,��`,�_ � Planning Department
s
`►•,.� ; Omaha/Douglas Civic Center
4521t7y'.j�'o� 1819 Famam Street,Suite 1100
z t :C
%®I,;.!', 4 ". , Omaha,Nebraska 68183
°�P,;�= ti (402)444-5150
O.447, FEBR��4� Telefax(402)444-6140
RD Robert C.Peters
City of Omaha Director
Mike Fahey,Mayor
November 29, 2004
Holy Name Housing
3014 North 45th Street
Omaha, NE 68104
453-6100
RE: FY 2004 HOME Agreement
Bond Waiver Request
Dear Sr. Ross,
This letter is in response to your correspondence requesting that the City waive tlif bonding
requirement in section 3.01.3 in the FY 2004 HOME Single Family Housing Development
Program agreement.
The City will waive the bonding requirement for the entire project. Lien waivers will be
required for each construction pay request.
Should you have any questions or concerns please contact Daisy Burton at 444-5J 8.
Sincerely,
//l/f
Robert C. Peters
Planning Director
cc: John Rehtmeyer
James Thele
Daisy Burton
Ed Dantzler
Dave Tollefsrud
FROM HOLY NAME HOUSING CORPORATION (MON) 11. 29' 04 9:46/ST. 9:41/NO. 4870201688 P 2
HOLY NAME
HOUSING
/ CORPORATION
November 29, 2004
Robert Peters, Planning Director
City of Omaha Planning Department
1819 Farnam Street, Suite 1100
Omaha, NE 68183
RE: Fontenelle View Bond Waiver Request
Dear Bob:
Holy Name Housing Corporation would like to request a waiver for the bonding requirements
associated with the FY 2004 HOME/CDBG agreement for our Fontenelle View Project.
Thank you for your assistance with this matter.
Sincerely,
W";&4i. ide4-4)
isa Burks
•
•
3014 North 45th Street
Omaha, Nebraska 68104
402-453-6100 • Fax 402-451-7187
Attachment 7
MEMORANDUM TO FILE
RE: SECTION 504 ACCESSIBILITY REQUIREMENTS
PROJECT: Holy Name Housing Corporation
5 single-family houses,new construction --Fontenelle View
The above named project is not exempt from Section 504 Accessibility Requirements.
Accessibility modifications required:
x The above named project is exempt from Section 504 Accessibility Requirements for the
following reason(s):
Single family unit
I /// /71919
d I antzler, Re bilitation Manager Date
OI,(Q I/- ze- ov
Marian Todd, Section 504 Officer Date
Attachment 8
CITY OF OMAHA
SUBSIDY LAYERING STANDARDS FOR THE HOME PROGRAM
Standard: Before committing funds to a project, the City of Omaha will evaluate the project in
accordance with the following guidelines and will not invest any more HOME funds, in combination with
other, private and/or governmental assistance, than is necessary to provide affordable housing. This
standard is established in accordance with Cranston Gonzalez National Affordable Housing Act, Section
212(F)as amended and 24 CFR Part 91.
Layering Guidelines: Generally, there will be multiple levels of review of the assistance received on a
project. The City of Omaha will rely on the determinations of the Nebraska Investment Finance
Authority, the City's Tax Increment Financing Authority and the Nebraska Equity Fund, as appropriate,
in evaluating such assistance.
City of Omaha Community Development staff will review the project pro-forma in assessing whether or
not the proposed HOME fund allocation is necessary to ensure feasibility of the project. All sources and
uses of funds will be detailed in applications and reviewed to determine that funding sources are
committed, an evaluation of all costs associated with the development will be conducted and the
reasonableness and appropriateness of the development costs will be assessed. All costs will be compared
to industry standards as to their reasonableness and certified by the Rehabilitation Inspector. The City
shall ensure that costs being funded by HOME are eligible and that per unit assistance does not exceed the
maximum.
Developers will be required to provide a project pro forma to the City of Omaha. The aggregate amount
of assistance from the US Depai liuent of Housing and Urban Development and all other sources will be
considered to ensure the viability of the project. Factors relevant to the feasibility of the project will
include, among other things, rates of returns to owners and investors relative to current interest rates,
long-term needs of the project and the usual and customary fees charged to the project. The target
population and the needs of tenants will also be considered when reviewing a project.
The City's policy is that projects serving extremely low-income persons will generally require a higher
subsidy than projects serving low-income persons, an that projects serving low-income persons will
require a higher subsidy than projects serving moderate-income persons, and so forth. Other factors may
include whether or not the project serves primarily persons with physical or mental disability, elderly
persons, or others with special needs. Additionally, non-profit organizations will generally require a
higher subsidy than for-profit businesses.
Project cash flow and rate of return will also be evaluated. The City of Omaha normally will not allow an
excessive gain or profit to be derived from a project. The specific standard governing rate of return is the
return on investment shall not exceed twenty percent(20%); except in the case of a Single-Family Rental
Rehabilitation Program project with no first mortgage, the project costs have been certified by the
Planning Department,rents are affordable, and operating expenses are reasonable,the maximum return on
investment shall not exceed forty percent(40%).
Certification: 1 a (�
The ro v'r i€l k V e w project located at Fp�'1T'Pi'1e.i i-e, V 1 ,,,) Li w'i sl on
has been evaluated in accordance with the above Subsidy Layering Standards for the HOME Program
guidelines, as approved by the Planning Director and the Housing and Community Development
Mana r.
/ ll-A3--01/
Daisy Cain B on, Contract Administration Date
and Compliance Manager
Revised 3/15/04
Attachment 9
Holy Name Housing Corporation
Homebuyer Deferred Payment Loan Determination Process
The prospective home purchaser in the Holy Name Housing Corporation's home ownership program will
proceed through the following loan approval process:
Initial assessment by HNHC representative to insure that the client's intent is home
ownership. If so, the home ownership program is briefly described and an application is
completed.
The HNHC Housing Developer reviews the completed application for eligibility.
Employment history, income and level of debt are reviewed for initial eligibility. Apparent
application difficulties and strengths are reviewed. If no obvious disqualifying issues are
identified, the applicants are asked to obtain a credit report.
The credit report is examined with the applicants. Any blemishes on the credit report are
discussed and a plan of action is implemented to clear credit problems. If no difficulties are
found, or when the problems are cleared up, the applicants are provided a list of HNHC
houses, which the applicants would be qualified to purchase, based on the total family
income.
When the applicants have selected a home they would like to purchase, they are referred to
Omaha 100, Inc. to complete the loan application process and secure permanent mortgage
financing.
During the loan approval process, all income sources are identified and verified. The
Housing to Income Ratio may not exceed 33% and the Debt to Income Ratio shall not exceed
42% of the applicant's monthly income.
When all conditions are met and first mortgage financing is tentatively approved, the
application is routed to the City Planning Department for a request for second mortgage
deferred payment loan(DPL)financing approval.
DPL Formula:
The DPL request is for an amount which will reduce the purchase price of the house to an
amount where the monthly housing payment of the first mortgage is less than or equal to
33%of the applicant's income.
Under no circumstances does the DPL exceed $35,000.00 for newly constructed
property by HNHC.
C-25A CITY OF OMAHA
LEGISLATIVE CHAMBER
Omaha,Nebraska
RESOLVED BY THE CITY COUNCIL OF THE CITY OF OMAHA:
WHEREAS, on March 31, 2000 by Resolution No. 1018, the City Council
approved an Agreement between the City of Omaha and Holy Name Housing Corporation, a
Nebraska Non-Profit Corporation (HNHC) for construction of houses in the Fontenelle View
Target Area Subdivision. This is the fourth amendment to the Agreement and, as such, this
Amended Agreement shall change the Agreement on the whole to consolidate terms; and,
WHEREAS, the subsequent three Amendments were approved by the City
Council as follows: first amendment, FY 2001, October 30, 2001, Resolution No. 2777; second
amendment, FY 2002, March 5, 2002, Resolution No. 532; and third amendment, July 1, 2003,
Resolution No. 895; and,
WHEREAS, HNHC has requested this Amendment for FY 2004 to reflect the
fifth phase of construction of single-family houses in the Fontenelle View Target Area
Subdivision bounded by Fowler Avenue on the North, Ames Avenue on the South, 45th Street on
the East, and 46th Street on the West provides partial financing of new construction of six (6)
houses and provision of deferred payment loans to assist qualified homebuyers in purchasing the
housing located in the Fontenelle View Target Area Subdivision; and,
WHEREAS, three (3) homes shall be funded by HOME funds and sold to
qualified homebuyers whose annual incomes are 80% and below the Median Family Income
(MFI) and three (3) homes shall be funded with CDBG funds and sold to any qualified
homebuyers; and,
WHEREAS, the total project cost for this phase of construction is estimated at
$870,000.00, comprised of $150,000.00 in CDBG funds, $150,000.00 in HOME funds, and
$570,000.00 in private and other funds; and,
By
Councilmember
Adopted
City Clerk
Approved
Mayor
C-25A CITY OF OMAHA
LEGISLATIVE CHAMBER
Omaha,Nebraska
PAGE 2
WHEREAS, this Project is an ongoing project applied to the total development of
41 units in the Fontenelle View Target Area Subdivision; and,
WHEREAS, the FY 1999, FY 2001, FY 2002, FY 2003 and FY 2004 funds will
provide partial financing to complete the fifth phase of construction; due to an increase in down
payment assistance to the homebuyer over the past few years and an increase in development
subsidy grants to HNHC, only twenty (20) houses have been constructed and sold, five (5)
houses are currently in various stages of construction and twelve (12) lots are undeveloped.
With this allocation of funds, HNHC will be able to complete an additional six (6) houses for a
total of thirty-one (31) units; and,
WHEREAS, total properties serving low and moderate income homebuyers under
this Amended Agreement shall include a minimum of twenty-one (21) of the properties that must
be purchased by qualified low and moderate income homebuyers whose annual household
incomes are 80% and below the MFI and the remaining ten (10) properties may be available to
purchase by households whose annual incomes are over 80% of the MFI; and,
WHEREAS, CDBG funding in the amount of $1,345,000.00 (comprised of
$400,000.00 FY 1999, $450,000.00 FY 2001, $245,000.00 FY 2002, $100,000.00 FY 2003, and
$150,000.00 of FY 2004)) shall be payable from CDBG Fontenelle View Housing Development
Program,Fund No. 12186, Organization No. 129124; and,
r WHEREAS, HOME funding in the amount of $465,000.00 (comprised of
$315,000.00 in FY 2003 and $150,000.00 in FY 2004 funds) shall be payable from HOME
Fontenelle View First Time Homebuyer Program, Fund No. 12179, Organization No. 128058;
and,
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF OMAHA:
By
Councilmember
Adopted
City Clerk
Approved
Mayor
I
C-25A CITY OF OMAHA
LEGISLATIVE CHAMBER
Omaha,Nebraska
PAGE 3
THAT, as recommended by the Mayor, the original.Agreement that was approved
by the City Council on March 31, 2000, by Resolution No. 1018, in conjunction with the
previous three amendments, between the City of Omaha and Holy Name Housing Corporation, a
Nebraska Non-Profit Corporation (HNHC) located at 3014 N. 45th Street, Omaha, Nebraska
68104, Sr. Marilyn Ross, Executive Director shall be amended on the whole. The former
amendments were approved on October 30, 2001 by Resolution No. 2777, March 5, 2002 by
Resolution No. 532, July 1, 2003 by Resolution No. 895 and together with the original
Agreement provided funds totaling $1,345,000.00 payable from CDBG Fontenelle View
Housing Development Program, Fund No. 12186, Organization No. 129124. This Amended
Agreement includes FY 2003 funds totaling $465,000.00 (comprised of$315,000.00 in FY 2003
and $150,000.00 in FY 2004 HOME funds) payable from HOME Fontenelle View Homebuyer
Program, Fund No. 12179, Organization No. 128058. This Amended Agreement involving
financing for construction of thirty-one (31) houses, of which twenty-one (21) homes shall be
sold to qualified low and moderate income homebuyers whose annual incomes are 80% and
below the Median Family Income, with the option of deferred payment loans and ten (10) houses
may be purchased by households whose annual incomes exceed 80% MFI, in the Fontenelle
View Taret� Area Subdivision bounded by Fowler Avenue on the North, Ames Avenue on the
South, 45 Street on the East, and 46th Street on the West, is hereby approved.
P:\PLN2\15236maf.doc AP VED AS TO FORM:
CITY ATTORNEY DATE
By *AO ar,i4ge
; , ounciilmember
`
Adopted'_ DEC 1 4' 200 . ... :.o
lr
City Clerk
Approved ""
- - Mayor
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