RES 2016-1358 - Agmt with Family Housing Advisory Services Inc for housing counseling program oMr.xe, yF8
�r�� ,!� k Planning Department
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(402)444-5150
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James R.Thele
City of Omaha 1 Director
Jean Stothert,Mayor
September 27, 2016
Honorable President
And Members of the City Council,
The attached Resolution approves a Community Development Block Grant (CDBG) Agreement
in the amount of$50,000.00 between the City of Omaha and Family Housing Advisory Services,
Inc., a Nebraska Non-profit Corporation (FHAS), Teresa C. Hunter, Executive Director, 2401
Lake Street, Omaha, Nebraska 68111. FHAS will use the CDBG Grant funding to provide
rehabilitation and homeownership counseling services during the grant term from January 1,
2016, through December 31, 2016.
The Project is included in the FY 2016 Consolidated Submission for Community Planning
Programs approved by the City Council on April 12, 2016, by Resolution No. 382. Funds shall
be payable from the FY 2016 Housing Development Program, Fund No. 12186, Organization
No. 128072.
Under the Agreement, FHAS will provide rehabilitation counseling services and pre-
purchase/post occupancy counseling to persons participating in City sponsored homeowner and
homebuyer programs.
Family Housing Advisory Services provides an excellent program of comprehensive housing
counseling. FHAS is primarily instrumental in helping those families who are having difficulty
meeting the program eligibility criteria and meeting their obligations toward City sponsored
housing programs. The expertise provided is invaluable in helping low- to moderate-income
families with financial management. During FY 2016, FHAS shall provide counseling services
for up to 300 individuals and/or families, of which, at least 51% would be income eligible and
who have applied to or are participating in city-sponsored housing loan/grant programs. The FY
2016 CDBG grant will supplement $273,550.00 in other funds for a total program budget of
$323,550.00.
Your favorable consideration of this Resolution will be appreciated.
Respectfully submitted, Referred to City Council for Consideration:
�' bt,24, _1347
tkli James R. Thele Date Mayor's Office Date
Planning Director
Approved:
Ji� 1�
Stephen B. Curtiss ate
Finance Director
2423 dlh
CDBG AGREEMENT
BETWEEN CITY OF OMAHA
AND
FAMILY HOUSING ADVISORY SERVICES,INC.
A NEBRASKA NON-PROFIT CORPORATION
FOR
HOUSING COUNSELING PROGRAM
JANUARY 1, 2016 THROUGH DECEMBER 31, 2016
Fiscal Year 2016
TABLE OF CONTENTS
SECTION 1 DEFINITIONS AND ABBREVIATIONS
SECTION 2 RESPONSIBILITIES OF CONTRACTOR
2.01 Overall Project Performance
2.02 Proposed Goals
2.03 Project Budget
2.04 Term of the Agreement
SECTION 3 CONDITIONS FOR RECEIPT OF CITY FINANCING
3.01 Documents Required by the City
3.01.1 Minority/Women Owned Business Enterprise Plan
3.01.2 Funding Compliance Deadline
3.01.3 Evidence of Leveraged/Matching Funds
SECTION 4 PROJECT RESPONSIBILITIES OF THE CONTRACTOR
4.01 Eligible Use of Funds
4.02 Terms and Conditions
4.03 Breach of Agreement
4.04 Ineligible Costs
4.04.1 Eligible Costs
4.05 Affirmative Marketing Policy
SECTION 5 GENERAL ADMINISTRATION REQUIREMENTS OF CONTRACTOR
5.01 Financial Management
5.02 Documentation and Record-Keeping
5.03 Reports
5.04 Record Retention
5.05 Personnel and Participant Conditions
5.06 Match Funds
5.07 Limited English Proficiency (LEP)
SECTION 6 CONTRACTOR'S COMPLIANCE WITH OTHER FEDERAL
REGULATIONS
6.01 Environmental Review
6.02 Uniform Relocation Act
6.03 Federal Funding Accountability and Transparency Act
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SECTION 7 RESPONSIBILITIES OF THE CITY
7.01 Performance Monitoring
7.02 Payments
7.03 Progress Payments
7.04 Technical Assistance
SECTION 8 MUTUAL AGREEMENTS BETWEEN CITY AND CONTRACTOR
8.01 Release of Information Laws
8.02 Applicable Laws
8.03 Interest of the City
8.04 Independent Contractor
8.05 Captions
8.06 Merger
8.07 Modification
8.08 Assignment
8.09 Strict Compliance
8.10 Termination
8.11 Reversion of Assets
8.12 Indemnification
8.13 Unenforceable Provisions
8.14 Disclosure of Lobbying
8.15 Notices
8.16 Applicability
SECTION 9 DEFAULT PROVISIONS
9.01 Remedies
SCHEDULE OF EXHIBITS AND ATTACHMENTS
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CDBG AGREEMENT
(FOR HOUSING COUNSELING)
THIS AGREEMENT is entered into by and between the City of Omaha and Family
Housing Advisory Services, Inc., a Nebraska Non-profit Corporation, 2401 Lake Street Omaha,
Nebraska 68111 (sometimes hereinafter referred to as "FHAS") based on terms, conditions and
provisions as set forth below.
RECITALS:
WHEREAS, the City of Omaha (hereinafter referred to as "the City") is a municipal
corporation located in Douglas County, Nebraska, and is organized and existing 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,
WHEREAS, the City of Omaha has applied for and received Community Development
Block Grant (hereinafter referred to as "CDBG") Funds under Title I of the Housing and
Community Development Act of 1974, as amended, for the purposes of benefiting low and
moderate income households, eliminating slums and blight and for other urgent community
development needs; and,
WHEREAS, the City's FY 2016 Consolidated Submission for Community Planning and
Development Programs (hereinafter referred to as "Consolidated Plan"), outlining priorities,
programs and funding allocations for the 2016 program year, was approved on April 18, 2016,
by Resolution No. 382; and,
WHEREAS, FHAS has been authorized to use CDBG funds in the amount of$50,000.00
for housing counseling services; and,
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WHEREAS, FHAS has submitted an application that provides for partial financing for
the continuation of the housing counseling services for the period January 1, 2016, through
December 31, 2016 (hereafter referred to as the "Project"); and,
WHEREAS, the Consolidated Plan identified that this Project meets a Community
Development Block Grant national objective by supporting activities related to housing that will
benefit occupied by low- and moderate-income households; and,
WHEREAS, the Project is a CDBG-eligible activity in that the Project qualifies as
Homeownership Assistance [24 CFR 570.201(e)] Public Service serving Low- and Moderate-
Income Clientele by providing housing counseling; and,
WHEREAS, the City wishes to enter into an Agreement with FHAS to assist the City in
utilizing such CDBG funds; and,
WHEREAS, the FHAS Grant Fund was included in the FY 2016 CDBG Program and
$50,000.00 was allocated to the Project; and,
WHEREAS, FHAS has indicated the total estimated cost of the Project to be $323,550.00
consisting of a $50,000.00 CDBG Grant, and $273,550.00 in other funds; and,
WHEREAS, it is in the best interest of the City and the residents thereof that the City
enter into an Agreement with FHAS to provide CDBG funding in the amount not to exceed
$50,000.00 for the Project.
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
Agreement:
1.01 "City" shall mean-the City of Omaha, a Nebraska Municipal Corporation.
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1.02 "Contractor" shall mean - Family Housing Advisory Services, Inc., a Nebraska
non-profit Corporation, 2401 Lake Street Omaha, Nebraska 68111 (see Exhibit
«A„
1.02.1 "FHAS" shall mean Family Housing Advisory Services, Inc.
1.03 "Director" shall mean - the Planning Director of the City of Omaha.
1.04 "Recipient" shall mean - the City of Omaha.
1.05 "Subrecipient" shall mean - a public or private non-profit agency, authority or
organization receiving CDBG funds to undertake eligible activities. In this
Agreement, the Subrecipient is FHAS.
1.06 "HUD" shall mean -the U.S. Department of Housing and Urban Development.
1.07 "CDBG Grant Funds" shall mean - that portion of the Community Development
Block Grant Program funds awarded to the City, subject to and conditioned upon
actual receipt of same by the City of Omaha, as may be available to grant during
the FY 2016 program year for the use specified herein in an amount not to exceed
$50,000.00 payable from the CDBG Housing Development Program, Fund No.
12186, Organization No. 128072, subject to the terms, conditions and
requirements of said Fund Agreement.
1.07.1 "Grant" shall mean - Community Development Block Grant funds
made subject to terms, conditions and provisions of this Grant
Agreement. The grant amount of $50,000.00 shall be unsecured.
FHAS shall perform Project responsibilities as outlined in Section 2.01
herein during the term of this Agreement. In the event these are
unencumbered funds at the expiration of term of the Agreement, these
funds shall be de-obligated by the City. In the event of default, gross
negligence or other substantial non-compliance, the amount of the grant
shall be due and payable immediately from FHAS to the City.
1.08 FHAS Homebuyer Counseling or "Project" shall mean — a program administered
by FHAS that provides rehabilitation counseling services and pre-purchased/post
occupancy counseling to persons participating in City sponsored homeowner and
homebuyer programs.
1.09 "Project Completion" shall mean - the date funds have been received by the
Contractor and allocated to the Project and all CDBG funds have been disbursed.
1.10 "Project Close Out" shall mean - the dates all project CDBG funds have been
disbursed and City has completed HUD close out procedures (24 CFR 570.509
and 2 CFR, Part 215 (Exhibit"B").
1.11 "Low- and Moderate-Income Family" or "Low- and Moderate-Income
Household" shall mean - a family/household whose annual household income
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(Attachment 1) does not exceed 80 percent of the median income for the Omaha
NE-IA Metropolitan Statistical Area as determined by HUD (Exhibit"C").
1.12 "Client" shall mean - a qualified person or household making application to or
participating in a City-sponsored housing program.
1.13 "Program Income" shall mean - the gross income received by the Recipient or
Subrecipient directly generated from the use of CDBG funds (24 CFR 570.500).
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 (see Exhibit "D" attached hereto and incorporated herein by this
reference as though fully set forth). Any program income funds received during
the term of this Agreement shall be returned to the City within thirty (30) days
prior to any additional distribution of CDBG funds.
SECTION 2. RESPONSIBILITIES OF CONTRACTOR.
2.01 Overall Project Performance
2.01.1 The Contractor shall use the Grant for the continuation of its Housing
Counseling Program.
2.02 Proposed Goals. Using 2016 Grant funds, the Contractor will provide counseling
services to up to 300 individuals and/or families who have applied to or are
participating in City-sponsored housing loan/grant programs as well as pre- and
post-occupancy counseling and extended case management services for
homebuyers participating in the City's homebuyer program(Exhibit"E"). Clients
will be referred for counseling to FHAS either directly by City staff or its
subrecipients or by the City's loan servicer through its delinquency reports or
other communication. The City will determine income eligibility for its clients
prior to referral.
2.02.1 Minimum Number of Maximum Percent of Area
Low/Moderate Income Median Income Permitted
Participants to Low/Moderate Income Client
300 80%
2.03 Project Budget. The Contractor asserts that the funding sources and amounts
listed below are committed as of the date of Grant closing with the City (Exhibit
L4E5D
FY 2016 CDBG $ 50,000.00
Other Public and Private Funds $273,550.00
Total Budget $323,550.00
2.04 Term of the Agreement
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2.03.1 This Agreement shall be in full force and effect beginning January 1,
2016 and shall end on December 31, 2016. Eligible expenditures
incurred after January 1, 2016, but prior to execution of this Agreement
may be submitted for reimbursement in accordance with the terms of this
Agreement. The Planning Director may extend the term of this
Agreement, but in no event shall the date extend beyond March 31, 2017.
SECTION 3. CONDITIONS FOR RECEIPT OF CITY FINANCING.
3.01 Documents Required by the 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 Contractor has
submitted for and received the prior approval of the Director of all of the
documents listed below.
3.01.1 Minority/Women Owned Business Enterprise Plan. Contractor shall
submit to the Director for his review and approval a minority and
women business participation plan that discusses economic
development and employment opportunities. These plans shall ensure
that the Contractor 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 (Attachment 4).
3.01.2 Funding Compliance Deadline. In the event that all conditions of
funding are not met on or before December 31, 2016, then this
Agreement shall automatically become null and void and the City shall
not be deemed to have assumed any obligation or liability hereunder.
3.01.3 Evidence of Leveraged/Matching Funds. Contractor shall provide
written evidence that funds detailed is the Project Budget described in
Section 2.03 herein have been committed or secured for this Project.
SECTION 4. PROJECT RESPONSIBILITIES OF THE CONTRACTOR.
4.01 Eligible Use of Funds. The Contractor 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 in the Scope of Work and Operating
Budget (Exhibit "E") attached hereto and incorporated herein as though fully set
forth.
4.02 Terms and Conditions. The Contractor shall abide by all terms and conditions of
this Agreement.
4.03 Breach of Agreement. If through breach of this Agreement the Contractor fails to
abide by all terms and conditions as described herein, all CDBG funds previously
provided to the Contractor through fulfillment of this Agreement shall promptly
be returned to the City.
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4.04 Ineligible Costs. The Contractor shall be responsible for payment of any Project
costs that exceed those specified in this Agreement.
4.04.1 Eligible Costs. The Contractor shall not request disbursement of funds
under this Agreement until the funds are needed for payment of eligible
costs.
4.05 Affirmative Marketing Policy. The Contractor agrees to comply with the City's
Affirmative Marketing Policy, attached hereto as Exhibit "F" 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. In
marketing, the Contractor shall also conform to the nondiscrimination provisions
hereinafter set forth in Section 5.05.1.2.
SECTION 5. GENERAL ADMINISTRATION REQUIREMENTS OF CONTRACTOR.
Contractor agrees to comply with the following requirements:
5.01 Financial Management.
5.01.1 Accounting Standards. The Contractor agrees to comply with 2 CFR,
Part 215 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 `B", attached hereto and incorporated herein as though fully
set forth).
5.01.2 Cost Principals. The Contractor shall comply with the requirements and
the standards of 2 CFR, Part 230, (Exhibit "G"), and with the
requirements of 2 CFR, Part 215 (Exhibit "B"). Both Exhibits are
attached hereto and incorporated herein as though fully set forth.
5.01.3 Audits. The Contractor shall comply with all provisions and regulations
of the Program and have an annual audit completed in compliance with
2 CFR, Part 200.5, attached hereto as Exhibit"I", 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$750,000.00 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 $750,000.00 in each fiscal year.
5.01.3.1 Any deficiencies noted in audit reports must be fully cleared
by the Contractor within 30 days after receipt of audit by the
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Contractor. Failure of the Contractor to comply with the
above audit requirements will constitute a violation of this
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. All Contractor records with respect to any
matters covered in this 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 contractor with
any subcontractors shall include this Section to ensure said access.
5.03 Reports. The Contractor shall submit to the City the following reports in
accordance with 24 CFR 570.506 with the submission timelines as specified.
5.03.1 Program Reports. The Contractor shall provide a Demographic
Summary (Exhibit "M") to the Director and notice of any significant
problems and/or delays on this project. Reports will be submitted at the
time of each pay request. In the event that there is no pay request
during any calendar year quarter of the agreement term, the Contractor
must submit a report to the City no later than the 15th of the month
following the end of that calendar year quarter. The program reports
are required until such time as all funds have been expended and the
City issues the final payment to the Contractor. The program reports
shall identify the progress and accomplishments of the Contractor on
the activities included in this Agreement and on contracts entered into
with third parties pursuant thereto.
5.03.2 Participant Report. For each participant in the Project, listed separately
for foreclosure prevention counseling and homebuyer education
activities, the Contractor shall report monthly the information listed
below:
5.03.2.1 percent of the Median Family Income (MFI) as determined
by HUD (Exhibit "C") by race of head of household and
ethnicity of head of household and by type of household.
Attachment 1 defines what constitutes income for the
purposes of calculating MFI. Race and Ethnicity
information must be documented (Attachment 5).
5.03.2.2 the number of female heads of household, defined as a
household containing one or more dependents headed by a
female adult.
5.03.3 Performance Measurement Report. No later than 30 days after the end
of the contract term or end of the activity, whichever comes first. The
contractor shall provide a report to the City identifying the
accomplishments of the Program, including number of participants,
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training activities, special classes and other outcomes, and final
demographics as provided in Exhibit M, Demographic Report.
5.03.4 Financial Status Reports. Contractor shall submit financial status reports
(2 CFR, Part 215) (Exhibit "B"). These reports shall be submitted
quarterly, regardless of whether a pay request is made. Attached as
Exhibit"L", and incorporated herein by this reference as though fully set
forth, is a sample Financial Status Report. In addition to the Financial
Status Report, pay requests must be accompanied by the following:
5.03.4.1 income statement delineating the revenue and line item
expenditures for FHAS.
5.03.4.2 copy of the monthly check register listing each expenditure
by check number, payee, date, and amount.
5.04 Record Retention.
5.04.1 In addition to the information required in Sections 5.03.1, 5.03.2, and
5.03.3, the Contractor must also retain the following information
regarding each client household:
5.04.1.1 name(s) of client(s)
5.04.1.2 home address of client(s)
5.04.1.3 household size
5.04.1.4 gender of head of household member
5.04.2 The Contractor and its 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 Contractor, or its
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
Agreement as specified in Section 2.03 of this Agreement or December
31, 2021 (2 CFR, Part 215) (Exhibit "B"). In the event the term of the
Agreement would be extended, the time frame for record retention
would be extended correspondingly.
5.05 Personnel and Participant Conditions.
5.05.1 Contract Compliance Clause.
5.05.1.1 Section 10-192 of the Omaha Municipal Code, Equal
Employment Opportunity Clause. The Contractor and its
subcontractors shall not discriminate against any employee or
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applicant for employment because of race, religion, color,
sex, age, sexual orientation, gender identity, national origin,
familial or handicap status. (Attachment 2) 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
Contractor and its subcontractors 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.
5.05.1.2 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, age, sexual orientation, gender identity,
national origin, familial or handicap status.
5.05.1.3 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 workers' 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.
5.05.1.4 The Contractor and its subcontractors shall furnish to the
Human Rights and Relations Department 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 its
records. Records accessible to the Human Rights and
Relations Department shall be those which relate to
Paragraphs 5.05.1.1 through 5.05.1.7 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.
5.05.1.5 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 5.05.1.1
through 5.05.1.7 herein, including penalties and sanctions for
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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.
5.05.1.6 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 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 Rights and Relations Department.
Compliance reports filed at such times as directed shall
contain information as to the employment practices, policies,
programs and statistics of the Contractor, contractor and his
subcontractors.
5.05.1.7 The Contractor shall include the provisions of paragraphs
5.05.1.1 through 5.05.1.7 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 each subcontractor or vendor. (Code 1980,
Section 10-192; Ord. No. 35344, Sections 1, 9-26-00).
5.05.2 Workers' Compensation. The Contractor shall provide Workers'
Compensation Insurance coverage for all employees involved in the
performance of this Agreement.
5.05.3 Employment Insurance and Bonding. The Contractor shall purchase a
blanket fidelity bond covering all employees, at a minimum, in an
amount equal to cash advances from the City. The Contractor shall
comply with bonding and insurance requirements of 2 CFR, Part 215,
Bonding and Insurance (Exhibit"B").
5.05.4 Minority Business/Women Business Enterprise Plan. The Contractor
shall make its best efforts to ensure that construction services, contracts
and employment opportunities are affirmatively marketed to women and
members of minority groups. As used in this Agreement, the term
"women and members of minority groups" means a business at least
fifty-one percent (51%) owned and controlled by minority group
members or women. (Attachment 4)
5.05.5 Section 3 — Employment of Low-Income Persons (Section 3 of HUD
Act of 68, as amended, 1 U.S.C. 1701u). The Contractor shall make its
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best efforts to comply with Section 3 (Attachment 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.
5.05.6 Conflict of Interest. The Contractor agrees to abide by the provisions of
24 CFR 570.611 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 Agreement. The
Contractor further covenants that in the performance of this Agreement
no person having such a financial interest shall be employed or retained
by the Contractor 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 CDBG
entitlement program.
5.05.7 Attestation of Citizenship. To comply with Neb. Rev. Stat. 4-108
through 4-114, the Contractor agrees to comply with the requirements of
5.05.7.1 and 5.05.7.2.
5.05.7.1 The Contractor shall include the following language in all
contracts and subcontracts for the physical performance of
services: "The Contractor is required and hereby agrees to
use a federal immigration verification system to determine
the work eligibility status of new employees physically
. performing services within the State of Nebraska. A federal
immigration verification system means the electronic
verification of the work authorization program authorized by
the illegal Immigration Reform and Immigrant Responsibility
Act of 1996, 8 U.S.C. 1324a, known as the E-Verify
Program, or an equivalent federal program designated by the
United States Department of Homeland Security or other
federal agency authorized to verify the work eligibility status
of a newly hired employee. If the Contractor is an individual
or sole proprietorship, the following applies:
a) The Contractor must complete the United States
Citizenship Attestation Form available on the
Department of Administrative Services website at
www.das.state.ne.us.
b) If the Contractor indicates on such attestation form that
he or she is a qualified alien, the Contractor agrees to
provide the U.S. Citizenship and Immigration Services
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documentation required to verify, the Contractor's
lawful presence in the United States using the
Systematic Alien Verification for Entitlements (SAVE)
Program.
c) The Contractor understands and agrees that lawful
presence in the United States is required and the
Contractor may be disqualified or the contract
terminated if such lawful presence cannot be verified as
required by Neb. Rev. Stat. 4-108."
5.05.7.2 The Contractor shall have each adult client applying for a
benefit under this agreement execute a United States
Citizenship Attestation Form For Public Benefit (Exhibit "J")
verifying eligibility status for the purposes of receiving a
public benefit. The Contractor shall maintain aggregate
records for the duration of the contract showing: (a) the
number of applicants for public benefits under this
agreement; and (b) the number of applicants rejected
pursuant to the lawful presence requirement set forth in the
above-referenced Nebraska statutes. Further the Contractor
shall provide a summary report to the City no later than
December 15th each calendar year reflecting this applicant
data for such calendar year.
5.05.8 Employee Classification Act. To comply with the Nebraska Employee
Classification Act, all contractors and subcontractors who perform
construction or delivery service pursuant to this contract shall submit to
the City an Affidavit For Employee Classification Act (Exhibit "K")
attesting that (1) each individual performing services for such contractor
is properly classified under the Nebraska Employee Classification Act,
2010 LB 563 ("the Act"), (2) such contractor has completed a federal I-9
immigration form and has such form on file for each employee
performing services, (3) such contractor has complied with Neb. Rev.
Stat. Section 4-114 (federal immigration verification system), (4) such
contractor has no reasonable basis to believe that any individual
performing services for such contractor is an undocumented worker, and
(5) as of the time of the contract, such contractor is not barred from
contracting with the state or any political subdivision pursuant to the
Act. The contractor shall follow the provisions of the Act. A violation
of the Act by a contractor is grounds for rescission of the contract by the
City.
5.06 Match Funds. The Contractor will provide documentation to the City showing all
non-federal funds in the Project. This documentation should include the
following:
a. source of funds (additional documentation as needed)
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b. amount of funds
c. date funds provided
d. designation(name) of funds
e. purpose of funds.
The documentation shall be submitted to the City annually no later than January
31st of the following year.
5.07 Limited English Proficiency (LEP). It is the policy of the City to take reasonable
steps to provide meaningful access to its programs and activities for persons with
Limited English Proficiency (LEP) in accord with Executive Order 13166 titled,
"Improving Access to Services by Persons with Limited English Proficiency".
The City's policy is to ensure that staff and subrecipients will communicate
effectively with LEP individuals, and LEP individuals will have access to
programs and information. The City is committed to complying with federal and
state requirements in providing access to this program and its activities for LEP
persons.
SECTION 6. CONTRACTOR'S COMPLIANCE WITH OTHER FEDERAL
REGULATIONS.
6.01. Environmental Review. The Contractor, if applicable, agrees to comply with the
following regulations insofar as they apply to the performance of this 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
CFR Part 50, as amended.
6.01.4 National Environmental Policy Act of 1969.
6.01.5 HUD Environmental Review Procedures (24 CFR 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 items of this contract, as it may apply to the
provisions of this contract.
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 CFR, Part 800, Advisory Council on Historic
Preservation Procedures for Protection of Historic Properties, insofar as
they apply to the performance of this Agreement. In general, this
16
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 Contractor 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
Contractor or its agent displaces any tenant-occupant of the property, it shall
immediately notify the City in writing of the circumstances surrounding said
displacement.
6.03 Federal Funding Accountability and Transparency Act. The Developer shall
comply with the applicable regulations of the Federal Funding Accountability and
Transparency Act (FAFTA) (75 Fed RgSS663) (September 14, 2010) (to be
codified at 2 CFR, Part 170). Developer shall complete and provide to the City
(Exhibit"N").
SECTION 7. RESPONSIBILITIES OF THE CITY.
7.01 Performance Monitoring. The City will monitor the performance standards of the
Contractor as stated herein. Substandard performance as determined by the City
will constitute non-compliance with this Agreement. If action to correct such
substandard performance is not taken by the Contractor 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 Agreement shall not exceed $50,000.00 in CDBG 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 Contractor as soon as reasonably possible and the Agreement
may be terminated.
7.02.1 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 Agreement, nor shall the City
incur any liability hereunder, unless and until the Contractor has timely
and fully complied with its duties and obligations hereunder. No
payments shall be made for the costs of any counseling service the
Director deems to be:
7.02.1.1 Unacceptable or substandard; or,
17
7.02.1.2 Not in accordance with this Agreement or related contracts
as approved for this Project.
7.03 Progress Payments. Progress payments and final payment, as may be authorized
by the Director or his designated representative, are subject to:
7.03.1 Receipt of requisite financial status reports, participant and program
reports.
7.04 Technical Assistance. The Director shall assist the Contractor in the same manner
the Director provides technical assistance to other contractors to ensure
compliance with this Agreement.
SECTION 8. MUTUAL AGREEMENTS BETWEEN CITY AND CONTRACTOR.
8.01 Release of Information Laws. The Contractor 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 Contractor further agrees to indemnify and hold harmless
the City of Omaha for any liability arising out the improper use by the Contractor
of information provided.
8.02 Applicable Laws. Parties to this Agreement shall conform to 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 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 Agreement is intended to, or
shall be construed in any manner, as creating or establishing the relationship of
employer/employee between the parties. The Contractor shall at all times remain
an independent contractor with respect to the services to be performed under this
Agreement. The City shall be exempt from payment of all Unemployment
Compensation, FICA, retirement, life and/or medical insurance and Worker's
Compensation Insurance as the Contractor is an Independent Contractor.
8.05 Captions. Captions used in this Agreement are for convenience and are not used
in the construction of this Agreement.
18
8.06 Merger. This Agreement shall not be merged into any other oral or written
agreement, lease or deed of any type.
8.07 Modification. This 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.
8.08 Assignment. The Contractor may not assign its rights or obligations under this
Agreement without the express prior written consent of the City.
8.09 Strict Compliance. All provisions of this 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 except upon written direction from
authorized representatives of the parties.
8.10 Termination. This Agreement may be suspended or terminated in accordance
with 24 CFR 85.43, Enforcement or CFR 85.44, Termination for Convenience
(Exhibit "H", attached hereto and incorporated herein by this reference as though
fully set forth). Upon termination of this Agreement, all funds and interest in any
account hereunder shall become the property of the City and shall be returned to
the City.
8.11 Reversion of Assets. Upon the expiration of this Agreement, the Contractor 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 CFR
570.503(b)(8)).
8.12 Indemnification. The Contractor shall indemnify and hold the City harmless from
and against: (1) any and all claims arising from contracts between the Contractor
and third parties made to effectuate the purposes of this Agreement; and, (2) any
and all claims, liabilities or damages arising from the preparation or presentation
of any of the work covered by this Agreement.
8.13 Unenforceable Provisions. Any provision of this 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.
8.14 Disclosure of Lobbying. The Contractor shall certify and disclose, to the best of
its knowledge and belief, that:
8.14.1 No Federal appropriated funds have been paid or will be paid, by or on
behalf of the Contractor, to any person for influencing or attempting to
influence an officer or employee of Congress, or an employee of a
19
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.
8.14.2 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 Contractor shall complete and submit standard Form-
LLL, "Disclosure Form to Report Lobbying", in accordance with its
instructions.
8.14.3 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.
8.15 Notices. The City and the Contractor hereby expressly agree that for purposes of
notice, including legal service or process, during the term of this 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:
James R. Thele
Acting Planning Director
City of Omaha
1819 Farnam Street, Room 1111
Omaha, Nebraska 68183
2) Contractor:
Teresa C. Hunter, Executive Director
Family Housing Advisory Services
A Nebraska Non-profit Corporation
2401 Lake Street
Omaha,Nebraska 68111
In the event the authorized representative changes during the term of this
Agreement, prior written notice will be given to the respective party at the address
noted above.
8.16 Applicability. This Agreement shall be binding upon the parties hereto.
20
SECTION 9. DEFAULT PROVISIONS.
9.01 Remedies. If, through any cause, the Contractor shall fail to fulfill in a timely and
proper manner any obligations under this Agreement, or violate any of the
covenants, representations or agreements hereof, the City may upon written notice
terminate this Agreement or such parts thereof as to this Agreement, and may
hold the Contractor liable, to the extent permitted by Nebraska Law, for any
damages caused to the City by reasons of such default and termination.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
indicated below:
WITNESS: FAMILY HOUSING ADVISORY
SERVICES,
a Nebraska Non-profit Corporation
`"k1JJL t Cl L L I:._ .) By: L11} )?k ,ice L /
Teresa C. Hunter, Executive Director
S 1 -e' el)?1,114-X/17 -7( 201-b
Date 1 Date
ATTEST: CITY OF OMAHA:
9
ty Clerk of the City of Omaha Date MAYOR OF THE CITY OF OMAHA ate
APPROVED AS TO FORM:
I
ASSISTANT CITY ATTORNEY Date
2423 dlh
21
SCHEDULE OF EXHIBITS
Agreement
Exhibit Location Description
A 1.02 Article of Incorporation, Bylaws, Corporate
Resolution, Board Members
B 1.10, 5.01.1, 2 CFR, Part 215
5.01.2, 5.03.4,
5.04.2 and 5.05.3
C 1.11 and 5.03.2.1 Median Family Income Chart
D 1.13 Definition—Program Income
E 2.02, 2.03 and 4.01 Scope of Work and Program Budget
F 4.05 Affirmative Marketing Policy
G 5.01.2 2 CFR, Part 230
H 8.10 Termination—CFR 85.43 — 85.44
I 5.01.3 2 CFR, Part 200.5
J 5.05.7.2 United States Citizenship Attestation Form For
Public Benefit
K 5.05.8 Affidavit for Employee Classification Act
L 5.03.4 Financial Status Report
M 5.03.1 Demographic Summary
N 6.03 Federal Funding Accountability and
Transparency Act
ATTACHMENTS:
1 City of Omaha Definition of Income
2 Equal Employment Opportunity Clause
3 Section 3 Clause
4 Minority/Women Owned Business Enterprise Plan
5 Race and Ethnic Data Reporting Form (HUD-27061-H)
22
•:''� 5 ; �kTE�F�N EXHIBIT A
• ::w 0Sa�A. AG
Bo SECRETARY'S O ICE ) —
IS II 13 _ ' Received and wed f or rezone
, , xnaLrocorde on firm roll No
REVISED ARTICLES OF INCORPORATION OF
a page..
_ SwsetekryniStatx
FAMILY HOUSING ADVISORY SERVICES, INCme nT);40. op reA,
(previously THE URBAN HOUSING FOUNDATION, INC. )
Pursuant to the provisions of the Nebraska Nonprofit
corporation Act, Neb. R.R.S. §§ 21-1901 et peg. , as amended, the .
undersigned Corporation hereby adopts the following Revised
Articles of Incorporation: •
ARTICLE I
NAME •
- The name orthe-C'-.aigior'atsoii"shall hereafter be Family
Housing -Advisory Services, Inc. The previous •name of the corpo-
ration was The Urban Housing FolmOntidn, Inc. .
ARTICLE II •
DURATION
• The period of the Corporation's duration is perpetual.. '
ARTICLE III • •
• • PURPOSES •
The Corporation is organized exclusively for .chari- • .
table, educational, and scientific purposes within the meaning of
Section 501(c)(3) of the Internal Revenue Code.. • Specifically-,
•
the Corporation is organized:
•(1) To provide comprehensive financial counseling and
advisory services related to housing to persons in financial
crisis or with limited incomes in order to provide them with the
- - --
EXHIBIT A
• • BC0 PAS
•
opportunity to secure and maintain decent, safe, and affordable
housing.
(2) To engage in other programs and provide other
services to prevent and alleviate the problems of homelessness.
(3) To solicit and receive contributions, gifts,
. grants, devises, or bequests of real or personal property, or
both, from individuals, foundations, partnerships, associations ,
governmental bodies, public or private corporations, and agencies
in furtherance of the above purposes.
(4) To engage in and conduct charitable, educational,
and scientific activities in furtherance of the above purposes.
.(5) Incidental to the above purposes, to have and to
exercise all of the rights and powers conferred upon nonprofit
corporations under the Nebraska Nonprofit Corporation Act as
• amended from time to time.
ARTICLE IV
LIMITATIONS •
Notwithstanding any other provisions of these Articles
• or the Bylaws:
(1) No part of the net earnings of this Corporation
shall inure to the benefit of, nor be distributable to, any
director or officer of the Corporation, or any private individ-
ual, except that reasonable compensation may be paid for services •
rendered to or for the Corporation.
(2) No substantial part of •the activities of this
Corporation shall involve carrying on propaganda or otherwise
attempting to influence legislation, nor shall this Corporation
••
•
EtWili;LZ-PA,P
•
- participate or intervene in (including .the publishing or distri-
•buting of statements) any political campaign. or on behalf of any
candidate for public office. •
(3) The Corporation shall neither have nor exercise
any.- power, nor shall it engage directly or indirectly in any
activity, that would invalidate its status (1) as a corporation
which is exempt from federal income taxation as an organization
described in Section 501(c) (3) of the Internal Revenue Code,, or
(ii) as a corporation contributions to which are deductible under
• • • Section 170(c)12) of the Internal -Revenue Code.
ARTICLE V
-
_-. _. .-_ POWERS :.-- • _ _ _ .
Subject to the foregoing limitations, this Corpora oon
shall have • and possess all powers and' rights -conferred upon
corporations by the Nebraska Nonprofit Corporation Act and any
enlargement of . such powers conferred' by subsequent legi slative '
acts; and, in addition thereto, this Corporation shall have and
exercise all powers • and rights not otherwise denied nonprofit
corporations by;the laws of the State •of Nebraska, as are' neces-
sary, suitable, proper, convenient or expedient to the attainment
of the purposes 'set forth in Article III hereof.
ARTICLE VI
BOARD OF DIRECTORS
The affairs of the Corporation shall be conducted by a
Board of Directors. The number, 9ualifications, term, method of
acting, and method of appointment and removal shall be fixed in '
the Bylaws. •
3
BDO °.PAGt 0•
)
ARTICLE VII
•
OFFICERS
The officers of the Corporation shall be a President,
Vice President, Secretary, and Treasurer, all of whom ' shall be
members of and be elected by the Board of Directors in such
manner as may be provided from time to time in the Bylaws. Any
two ; or more offices, except the offices of President and Secre-
tary, may be combined. The Board may appoint subordinate offi-
cers who need not be Board members.
ARTICLE VIII
BYLAWS
Initial Bylaws . of the Corporation shall be adopted 'by
the Board of Directors of the Corporation upon an affirmative
vote of a majority of the Directors. The Bylaws may be amended
in. the manner established by the Bylaws.
ARTICLE IX
AMENDMENT OF ARTICLES
T .�..�W..,r n.f thc! n4+"+".r++�wLe.i.e •..� r�i1•v v.~j+v...x ...-�.._ _ .,r .
be amended at .any meeting of the -Board of Directors; provided
that a copy • of the proposed amendment has been mailed to each
director at least ten (10) days prior to the meeting.
ARTICLE X
DISSOLUTION
• Upon dissolution of this Corporation, any assets
remaining after the payment of all .debts, claims, and obligations
shall be distributed to one or more organizations .operated •
exclusively for charitable, educational, or scientific purposes,
4
BOO 9AGP: e;-P„:
as shall at the time qualify as an organization or organizations
exempt from federal income taxes under Section 501(c) (3 ) .of the
Internal Revenue Code. Such distribution shall be made pursuant
to a plan of distribution adopted by the Board of Directors.
• ARTICLE XI
LIMITATION ON LIABILITY •
The incorporators, directors, officers, employees, and
volunteers of the Corporation shall not be liable for the debts,
liabilities, and obligations of the Corporation and the private
• • property of such persons 'shall not be subject to the payment of
corporate debts.
..ARTICLE KI I
INDEMNIFICATION • • •
The Corporation shall indemnify any person who is made •
or threatened to be made a party to any threatened, pendibg, or
completed action, suit, or proceeding whether ' civil, criminal,
administrative, or .investigative by reason- of the fact that he or
she is or was a director, officer, employee, or agent of the
Corporation, against expenses including attorneys' fees, • judg-
• ments, fines, and amounts paid in settlement actually. and reason-
ably incurred by him or her. in connection with such action, 'suit,
or proceeding to the fullest extent allowed under the Nebraska
Nonprofit Corporation Act as the same exists or may hereafter be
amended: The Board of Directors may authorize the purchase or
maintenance of insurance by the . Coiporation on behalf of any
person who is or was a director, officer, employee, or agent of
the Corporation, or is or was serving • at the request of the
5
a0014='' PAGL. .Zv 1
Corporation as a director, officer, employee, or agent of another
corporation, partnership, joint venture, trust, or other enter-
prise against any liability asserted against him or her and
incurred by him or her in any such capacity or arising out of his
or her status as such, whether or not .the Corporation would have
the power to indemnify him or her against such liability under
the provisions of this Article.
ARTICLE XIII
NEBRASKA NONPROFIT CORPORATION ACT
This Corporation is organized under the Nebraska
Nonprofit Corporation Act, Neb. R.R.S. §§ 21-1901 et seg. , as.
amended. The registered office of'the Corporation is at 2416 Lake
Street, Omaha, Nebraska, -and the registered agent is Deborah L. Brockmar
ARTICLE XIV
SUPERSESSION
These Revised Articles of Incorporation supersede the
original Articles of Incorporation. and all amendments and previ-
ous revisions thereto.
The undersigned President of the Corporation, hereby
certifies, and ;the undersigned Secretary hereby attest that •t iese
. Revised Articles of Incorporation were duly adopted by the Board
of Directors on September 12, 1991.
•
a.
?esident
Attest: ���� 1 ✓
Secretary
6
BYLAWS OF
FAMILY ROUSING ADVISORY SERVICES,INC.
ARTICLE I
Board of Directors
Section 1. Powers.
The business of and affairs of Family Housing Advisory Services, Inc., ("the corporation") shall
be conducted by its Board of Directors.
Section 2. Number.
The number of Directors shall be not less than eleven(11)nor more than nineteen(19);provided,
however,if the number of Directors should fall below eleven(11),the remaining Directors shall have the
power to elect additional persons to the Board of Directors so that the minimum number exists. Five (5)
of the Directors shall be nominated by the Omaha 100 Board as representatives of Omaha 100.
Sectio 3. Selection; Term.
Regular elections of the Board of Directors shall be at the annual meeting. Directors hall be
elected to serve a three-year term or until their successors have been elected. Directors elected in the
interim between annual meetings shall be elected for a term to extend from the date of election until the
next annual meeting and shall thereafter be eligible to be elected to serve a three-year term or until their
successors have been elected.Directors shall be persons broadly representative of the community served
by the Corporation and hall be persons with leadership or administrative abilities or both,who are
committed to the goal of furthering the Corporation's charitable purpose.No board member,shall be
eligible to be elected if the person has already served two or more consecutive three year terms; provided,
however,after a one year absence from the Board of Directors,a person shall be eligible to again be
elected to serve on the Board of Directors; and provided further,however, a person who is otherwise
ineligible to be elected by reason of having already served two or more consecutive three year terms may
be declared eligible to be elected to a special additional term(not to exceed one year)upon a
determination by the board of directors that there is a good cause to do so, and the board of directors may
so elect such a person to the board of directors.
Section 4.Absence from Meeting.
A Director who shall fail, during any consecutive twelve-month period,to attend one-half or more
of the regularly scheduled meetings of the Board may be removed from Board membership.A Director so
removed shall be eligible for reinstatement for the remainder of the term being served upon action by the
Board of Directors upon a showing of good cause by the Director.
Section 5.Removal; Resignation.
In addition to automatic removal described in Article I-Section 4, The Board of Directors may, at
any regular meeting or special meeting called for such purpose,remove any Director and may accept the
resignation of any Director,upon a vote of a majority of the entire Board of Directors.
Section 6. Compensation to Directors.
No fee, salary, or other compensation shall be paid to any Director,but the expenses of a Director
in performing the business of the Corporation may be reimbursed upon authorization by the Board.
Section 7. Composition of Members.
Directors appointed through a designated selection process include: Five Directors will be
appointed by the Omaha 100 Board of Directors as representatives of Omaha 100 subject to the approval
by the corporation Board of Directors.
ARTICLE II
Meetings of the Board of Directors
Section 1.Meetings.
A regular annual meeting of the Board of Directors shall be held in December of each year. The
Board may provide for the holding of additional regular meetings.
Special meetings may be called by the President of the Board whenever,in his or her judgment,
the interests of the Corporation require the same;and shall be called when requested in writing by two(2)
or more Directors.
Section 2.Notice.
Notice of the scheduling of regular meetings shall be given at least two days prior to such meeting
and notice of the scheduling of any special meeting shall be given at least two days prior to such meeting
and shall state the business to be transacted at the special meeting. The notice shall be in writing and set
forth the time, date,place,and agenda of the meeting;however,in event of an emergency, such notice
may be oral. Such notice may be by mail,telegraph,personal delivery,facsimile or through electronic e-
mail.If mailed, such notice shall be deemed to be delivered when deposited in the United States mail,
properly addressed as appears on the records of the Corporation,with postage prepaid. Any director may
waive notice of a meeting.The attendance of a Director at a meeting shall constitute waiver of notice of
such meeting, except where a Director attends a meeting for the express purpose of objecting to the
transaction of any business because the meeting is not lawfully called or convened. Any business may be
transacted at any regular meeting,of which notice has been given, and at any meeting at which all '
Directors are present,whether or not notice or waiver thereof has been given.No business other than
stated in the notice may be transacted at a special meeting.
Section 3.Voting; Quorum.
A majority,defined as greater than one-third of the number of directors in office, shall constitute a
quorum for the transaction of business.Each Director present shall be entitled to one(1)vote. Voting by
proxy shall not be permitted.
Section 4. Manner of Acting.
Except as otherwise required by law or by the Articles of Incorporation or Bylaws,the act of the
majority of the Directors present at a meeting at which a quorum is present shall be the act of the Board
of Directors. The Board of Directors or any Board Committees may meet in any manner authorized by
law.
Section 5. Dispensing with Meetings.
Whenever the vote of the Board of Directors at a meeting thereof is required to be taken in
connection with any corporate action,the meeting of Directors may be dispensed with and the corporate
action may be carried forward if each Director consents in writing to a written vote on the action without
a meeting of Directors,and if a majority of the entire Board files with the Secretary written consent to the
corporate action being taken.
ARTICLE HI
Officers of the Corporation
Section 1. Officers.
The officers of the Corporation shall consist of a President, a Vice President,a Secretary,a
Treasurer, and the Immediate Past President(if still a Board member),and such other subordinate officers
as may be appointed by the Board of Directors. The duties,powers, and authorities of officers and
subordinate officers shall be provided in the Bylaws, or by resolution of the Board of Directors. The
President,Vice President, Secretary,and Treasurer shall be elected from among the Board of Directors at
the annual meeting of the Board of Directors for a period of one (1)year or until their successors have
been elected and have assumed their duties.
Section 2. President of the Board.
The President of the Board shall interest himself or herself in all affairs of the Corporation;he or
she shall preside at all meetings of the Board of Directors.He or she shall appoint all committees and
designate all committee chairmen,unless the composition of any committee is specifically provided for in
the Articles or these Bylaws, and shall be an ex-officio voting member of all committees.He or she shall
do and perform such other duties and responsibilities as are usually incident to the office or as may from
time to time be assigned to him or her by the Board of Directors or as may be provided in these Bylaws
Section 3. Vice President of the Board.
The Vice President of the Board shall act as President of the Board in the absence of the President
of the Board and,when so acting, shall have all the power and authority of the President of the Board. The
Vice President of the Board shall have such other duties and responsibilities as are usually incident to the
office or as from time to time may be assigned to him or her by the Board of Directors or the President of
the Board,or as may be provided in these Bylaws.
Section 4. Secretary.
It shall be the duty of the Secretary to keep an accurate record of accounts and proceedings of all
Directors meetings; give all notices required by law,by the Board of Directors,by the Articles of
incorporation, or by these Bylaws; and assist in keeping the records of the Corporation and its
correspondence. The Secretary shall have such other duties and responsibilities and may exercise such
other powers as are usually incident to the office or as from time to time may be assigned to him or her by
these Bylaws,the Board of Directors,or the President of the Board. The Board of Directors or the
President of the Board may delegate all or part of the authority and duties of the Secretary to suborcli i ate 41
officers or staff.
Section 5. Treasurer.
The Treasurer shall be responsible for the safekeeping of the Corporation's funds;the full and
accurate accounts of all receipts and disbursements of the Corporation, and inventory of assets, and a
record of the liabilities of the Corporation;the deposit of all money and other securities in such
depositories as may be designated by the Board of Directors;the disbursement of funds of the
Corporation as ordered by the President of the Board of Directors,taking proper vouchers for
disbursements; and the preparation of all statements and reports required by law,by the President of the
Board,or by the Board of Directors.The Treasurer shall have such other duties and responsibilities and
may exercise such other powers as are usually incident to the office or as from time to time may be
assigned to him or her by these Bylaws,the Board of Directors, or the President of the Board. The Board
of Directors or the President of the Board may delegate all or part of the authority and duties of the
Treasurer to subordinate officers or staff.
Section 6. Immediate Past President.
The office of Immediate Past President shell be held by the person who held office of President in
the previous year,if during the subsequent year such person remains a member of the Board of Directors;
otherwise such office shall be unfilled.. The Immediate Past President shall have duties and responsibilities
as from time to time may be assigned to him or her by the Board of Directors or the President of the Board,
or as may be provided in the Bylaws.
Section 7. Removal; Resignation.
The Board of Directors,by majority vote of the entire Board of Directors at any meeting, may
remove from office any officer or subordinate officer of the Corporation and any meeting may accept the
resignation of any officer of the Corporation.The Board of Directors may delegate to any officer the
authority to remove or accept the resignation of any subordinate officer.
Section 8. Vacancies.
Any vacancies occurring in the offices of President of the Board,Vice President of the Board,
Secretary, or Treasurer by death,resignation,removal,or otherwise may be filled for unexpired portion of
the term of the Board of Directors at a special meeting called for such purpose,but such vacancies need
not be filled until the first annual meeting of the Board of Directors if the Board of Directors does not
deem it advisable to fill the vacancy prior to that meeting.
ARTICLE IV
Committees of the Board of Directors
Section I. Committees.
Committees of the Board of Directors shall be standing or special. The Board of Directors or the
President of the Board of Directors may refer to the proper committee any matter affecting the
Corporation or any operations needing study,recommendation,or action. The Corporation may carry out
its responsibilities of review and approval through assignment of such responsibility to committees or
officers as it directs.
Section 2. Committee Requirements,Generally.
Each standing and special committee created pursuant to these Bylaws shall be subject to the
following requirements:
a. Each Committee member shall have one vote,but there shall be no voting by proxy.
All committee business may be transacted by a majority vote of members in attendance, a
quorum being present,unless otherwise provided for.
b. The procedures at Article II-Section 2 shall apply in providing notice of Committee meetings.
Unless otherwise specifically provided under these Bylaws,each Committee shall
meet upon call by the Chairman of the Committee meeting. The meeting will be held at the
offices of the Corporation at the time and date fixed unless changed by the President of the
Board or by the Committee Chairman.
c. Each committee shall maintain minutes of meetings and proceedings.
d. All Committee members shall serve for a period until the next annual meeting of the Board of
Directors or such other term as is established by the Board of Directors.
e. The Board of Directors may delegate to any standing or special committees or any executive
officer,the power to take action in specific instances,except to the extent that the same is
reserved to the Board.
f. Except as otherwise provided, a majority of voting members of any standing or special
committee shall constitute a quorum for the transaction of business.
g. Except as otherwise provided,committee members need not be members of the Board of
Directors.
h. The President of the Board shall appoint the members of each committee, and a chairman and
vice chairman of each committee.
Section 3. Standing Conunittees.
There shall be four standing committees of the Board.They shall be:
a. Executive Committee. There shall be an Executive Committee of the Board,which shall have all
powers to act on behalf of the Corporation in between meetings of the Board of Directors and such
other powers in matters which are from time to time delegated to it by the Board of Directors,
subject to limitations set by the Board of Directors and by applicable law. The Executive
Committee shall consist of the President,Vice President, Secretary,Treasurer,Immediate Past
President,two at-large members of the Board,and representative from the Omaha 100 Board. It
shall be responsible for an annual performance evaluation of the Executive Director,the
recruitment and nomination of new directors,the nomination of officers, and such other duties as
may be assigned by the Board of Directors,the President of the Board,or as may be provided in
these Bylaws.
b. Finance Committee. The Finance Committee shall consist of the Treasurer, as Chair, and at least
two other members of the Board of Directors.It shall be responsible for review of the
Corporation's annual review of the Corporation's annual audit,review of the Corporation's
financial performance and comparisons to budget,review and supervision of facility needs, and
review and supervision of programming related audit and regulatory compliance matters. It shall
also perform such other duties as may be assigned by the Board of Directors,the President of the
Board, or as may be provided in these Bylaws.
c. Community Relations Committee. The Community Relations Committee shall consist of at least
one member of Family Housing Advisory Services Board of Directors who shall chair the
committee. The Committee shall be responsible for expanding FHAS' community connections,
raising awareness of programs and services,volunteer recruitment,assisting with agency
marketing efforts,events and fundraising activities,and such duties as assigned by the Board of
Directors.
d. Facilities Committee. The Facilities Committee shall be responsible for setting policy for the
operations of the building and providing input regarding the use, grounds,maintenance,and fiscal
responsibility of FHAS facilities. This Chair of this committee shall be a board member.
Section 4. Other Committees.
The Board may establish other standing and or special committees as it deems necessary to
conduct the business of the corporation.
ARTICLE V
Executive Director
The Board of Directors shall have the power to appoint an Executive Director of the Corporation.
Subject to the direction and supervision of the Board of Director shall be the chief executive officer of the
Corporation and shall have general charge of the business affairs and property of the Corporation. The
Executive Director shall have such other duties and responsibilities and may exercise such other powers
as may from time to time be assigned by the Board of Directors. The Executive Committee of the Board
of Directors may authorize the payment of reasonable compensation for services rendered to or for the
Corporation by the Executive Director.The Executive shall serve at the pleasure of the Board of
Directors.
ARTICLE VI
Conflict of Interest
Section I. Conflict of Interest Defined.
A conflict of interest is defined as the existence of circumstances where the actions of an
individual as a Director of the Corporation may have an effect of financial benefit or detriment to the
individual,a member of his or her family,a business associate, or a business in which he or she owns an
interest.
Section 2.Prohibited Actions.
No Director shall knowingly permit the Corporation to enter into a business transaction with
him/her,or with a member of his/her family, employer,business associate or with any entity in which
he/she is an officer,director,trustee, general manager or in which he/she holds an ownership interest,
without previously informing all persons charged with approving the transaction of his/her position or
interest and any and all significant facts in connection therewith.
No Director shall actively participate in or vote in favor of,a decision by the Board or one of its
committees to enter into a business transaction with the member,a family member,employer,business
associate,or with any entity,in which the Director is an officer,director,trustee,general manager or
holds an ownership interest and such fact of nonparticipation and non-voting by the Director shall be
entered in the minutes of the meeting by the Board.
ARTICLE VII
Miscellaneous
Section 1. Property of the Corporation.
The title to all property of the Corporation,both real and personal, shall be vested in the
Corporation.
Section 2. Contributions.
All contributions of any nature, unless designated for a specific purpose, shall be used for such
purposes as the Board of Directors may direct;and in the absence of any direction by the Board, such may
be used for the general purposes and in any manner for which the contributions are made. Contributions
include bequests and devises under last wills of deceased persons.
Section 3. Contracts.
The Board of Directors,except as otherwise provided in these Bylaws,may authorize any officer
or agent to enter into any contract or execute and deliver any instrument in the name of and on behalf of
the Corporation,and such authority may be general or confined to a specific instance,and unless so
authorized by the Board of Directors,no officer, agent,or employee shall have any power or authority to
bind the Corporation by any contract or engagement,or to pledge its credit,or render it liable peculiarly
for any purpose or to any amount.
Section 4. Voting stock owned by the Corporation.
Unless otherwise ordered by the Board of Directors and except as limited at Article V of the
Bylaws,the President shall have power and authority on behalf of the Corporation to vote either in person
or by proxy at any meeting of stockholders of any corporation in which this Corporation may hold stock,
and at any such meeting may possess and exercise all of the rights and powers incident to the ownership
of such stock which,as the owner thereof,this Corporation might have possessed and exercised if present.
The Board of Directors may confer like powers upon any other person and may revoke any such powers
as granted at its pleasure.
ARTICLE VIII
Amendments
These Bylaws may be amended in any respect,by a majority vote of the entire Board of Directors,
at any regular or special meeting of the Board of Directors,provided that a copy of the proposed
amendment has been mailed to each member of the Board of Directors at least ten(10)days prior to final
action by the Board. Amendments to the proposed amendments may be entertained and acted upon at any
such meeting.
Duly adopted the 12a'day of September, 1991.
Amended the 16th day of May, 1996
Amended the 27th day of March, 1997
Amended the 23rd day of March,2000
Amended the 5th day of December,2002
Amended the 30th day of January,2003
Amended the 18th day of May,2006.
Amended the 8th day of May,2008
Amended the 18th day of December,2014
Family Housing Advisory Services, Inc.
CORPORATE RESOLUTION
For General Authority for Submission of Grants
I, Ernest White, do hereby certify that I am the duly elected President of Family Housing
Advisory Services, Inc. a Nebraska not-for-profit corporation (hereinafter referred to as
"FHAS"), authorized to conduct business in the State of Nebraska, and that the following is a
copy of the Resolution adopted at a meeting of the Executive Committee of the Board of
Directors of said corporation,held on the 1st day of August,2013.
WHEREAS,the Bylaws of FHAS provide that the Board of Directors may authorize any
officer or agent of FHAS to enter into any contract or execute and deliver any instrument in the
name of and on behalf of the Corporation and such authority may be general or combined to a
specific instance;and
WHEREAS, the Bylaws of FHAS provide that the Executive Committee of the Board
may act on behalf of the Board of Directors between regularly scheduled meetings of the Board
of Directors,
NOW, THEREFORE, BE IT RESOLVED that Teresa C. Hunter, as Executive
Director/CEO, has the general approval and authority of the Board of Directors to execute and
deliver any instrument in the name of and on behalf of the Corporation in order to make
application for or solicit funding on behalf of the Corporation.
I do hereby further certify that since the adoption of this Resolution, it has been neither
revoked nor amended; and,I do hereby further certify that on February 28, 2013, Ernest White
was elected President of the FHAS Board of Directors,and that on February 28,2013,Ed
Kentch was elected Secretary, and that they have been since that date and are now,respectively
President and Secretary of FHAS.
Witness my hand and the seal of FHAS this 1st day of August,2013.
F
t—
Ernest White,President
Family Housing Advisory Services, Inc.
Family Housing Advisory Services Inc.
2014-2015 Board of Directors List
Board Member Company/Affiliation
Ernest White,President American National Bank
W:(402)451-5100 3147 Ames Avenue,Omaha,NE.68111
Shannon Snow, Vice-President Metropolitan Community College
W:(402)457-2617 P 0 Box 3777,FOC Bldg.030,Omaha,NE.68111
Cecelia Creighton,Treasurer All Care Health Center
W:(712)256-8571 902 S.6Th Street, Council Bluffs,Iowa 51503
Michael Matejka,Secretary Woods&Aitken,LLP
W:(402)898-7409 10250 Regency Circle, Suite 525,Omaha,NE.68114
Christen Blackledge ConAgra Foods Inc.
W:(402)240-7715 7350-370 World Communications Dr.,Omaha,NE.68122
Danielle Crough SilverStone Group
W:(402)964-5546 11516 Miracle Hills Dr.#100,Omaha,NE.68131
Ryan Ellis PJ Morgan Real Estate
W:(402)397-7775 7801 Wakeley Plz.,Omaha,NE.68114
Jason Fischer Surreal Media Labs
W:(402)208-3113 2626 Harney Street,Omaha,NE.68114
Alec Gorynski First National Bank of Omaha
W:(402)602-8466 1620 Dodge Street LM-11,Omaha,NE.68102
Sara McCue Baird Holm Law Firm
W:(402)636-8261 1500 Woodmen Tower,Omaha,NE.68102-2068
Sister Marilyn Ross Holy Name Housing Corporation
W:(402)453-6100 3014 N.45th Street,Omaha,NE.68104
Liliana Shannon Legal Aid of Nebraska
W:(402)348-1069 1904 Famam Street,Omaha,NE.68102
1111111.111111111111111......11111111111111111......1111
1111.1111-- .
Attachment A
Board Members
EXHIBIT B
PARTS 200-214 [RESERVED] 215.36 Intangible property.
215.37 Property trust relationship.
PART 215-UNIFORM ADMINISTRA- PROCUREMENT STANDARDS
TIVE REQUIREMENTS FOR GRANTS 215.40 Purpose of procurement standards.
AND AGREEMENTS WITH INSTITU- 215.41 Recipient responsibilities.
TIONS OF HIGHER EDUCATION, 215.42 Codes of conduct.
HOSPITALS, AND OTHER NON- 215.43 Competition,
215.44 Procurement procedures.
PROFIT ORGANIZATIONS (OMB 215.45 Cost and price analysis.
CIRCULAR A 110) 215.46 Procurement records.
215.47 Contract administration.
Sec. 215.48 Contract provisions.
215.0 About this part. REPORTS AND RECORDS
Subpart A-General 215.50 Purpose of reports and records.
215.51 Monitoring and reporting program
215.1 Purpose. performance.
215.2 Definitions. 215.52 Financial reporting.
215.3 Effect on other issuances. 215.53 Retention and access requirements
215.4 Deviations, for records.
215.5 Subawards.
TERMINATION AND ENFORCEMENT
Subpart B-Pre-Award Requirements 215.60 Purpose of termination and enforce-
215.10 Purpose. ment.
215.11 Pre-award policies. 215.61 Termination.
215.12 Forms fora applying 1 n for Federal assist-
ance. Subpart D-After-the-Award Requirements
215.13 Debarment and suspension.
215.14 Special award conditions. 215.70 Purpose.
215.15 Metric system of measurement. 215.71 Closeout procedures.
215.16 Resource Conservation and Recovery 215.72 Subsequent adjustments and con-
Act. tinning responsibilities.
215.17 Certifications and representations. 215.73 Collection of amounts due.
Subpart C-Post-Award Requirements APPENDIX A TO PART 215-CONTRACT PROVI-
SIONS
FINANCIAL AND PROGRAM MANAGEMENT AUTHORITY: 31 U.S.C. 503; 31 U.S.C. 1111; 41
215.20 Purpose of financial and program U.S.C. 405; Reorganization Plan No..2 of 1970,
management. E.O. 11541, 35 FR 10737, 3 CFR, 1966=1970, p.
215.21 Standards for financial management 939.
systems. SOURCE: 69 FR 26281, May 11, 2004, unless
215.22 Payment. otherwise noted.
215.23 Cost sharing or matching
215.24 Program income. $215.0 About this part.
215.25 Revision of budget amid program
plans. (a) Purpose. This part contains OMB
215.26 Non-Federal audits, guidance to Federal agencies on the ad-
215.27 Allowable costs. ministration of grants to and agree-
215.28 Period of availability of funds. ments with institutions of higher edu-
215.29 Conditional exemptions. cation, hospitals, and other non-profit
PROPERTY STANDARDS organizations. The guidance sets forth
standards for obtaining consistency
215.30 Purpose of property standards, ' and uniformity in the agencies' admin-
215.31 Insurance coverage. istration of those grants and agree-
215.32 Real property. ments.
215.33 Federally-owned and exempt prop-
erty. (b) Applicability. (1) Except as pro-
215.34 Equipment. vided herein, the standards set forth in
215.35 Supplies and other expendable prop- this part are applicable to all Federal
erty. agencies. If any statute specifically
77
§215.1 2 CFR Ch. II (1-1-12 Edition)
prescribes policies or specific require- where adequate justification is pre-
ments that differ from the standards seated.
provided in this part, the provisions of (5) Conducting broad oversight of
the statute shall govern. government-wide compliance with the
(2) The provisions of subparts A guidance in this part.
through D of this part shall be applied (d) Federal agency responsibilities. The
by Federal agencies to recipients. Re- head of each Federal agency that
cipients shall apply the provisions of awards and administers grants and
those subparts to subrecipients per- agreements subject to the guidance in
forming substantive work under grants this part is responsible for:
and agreements that are passed (d) Implementing the guidance in
through or awarded by the primary re- subparts A through D of this part by
cipient, if such subrecipients are orga- adopting the language in those sub-
nizations described in paragraph (a) of parts unless different provisions are re-
this section. quired by Federal statute or are ap-
(3) This part does not apply to grants, proved by OMB.
contracts, or other agreements be- (2) Ensuring that the agency's corn-
tween the Federal Government and ponents and subcomponents comply
units of State or local governments with the agency's implementation of
covered by OMB Circular A-102, the guidance in subparts A through D
"Grants and Cooperative Agreements of this part.
with State and Local Governments"1 (3) Requesting approval from OMB
and the Federal agencies' grants man- for deviations from the guidance in
agement common rule (see §215.5) subparts A through D of this part in
which standardize the administrative situations where the guidance requires
requirements Federal agencies impose that approval.
on State and local grantees. In addi- (4) Performing other functions speci-
tion, subawards and contracts to State fled in this part.
or local governments are not covered
by this part. However, this part applies (e) Relationship to previous issuance.
The guidance in this part previously
to subawards made by State and local
ts to organizations covered was issued as OMB Circular A-110. Sub-
is
by thnmepant. parts A through D of this part contain
(4) Federal agencies may apply the the guidance that was in the attach-
provisions of subparts A through D of meat to the OMB circular. Appendix A
thisto this part contains the guidance that
part to commercial organizations,
foreign governments, organizations was in the appendix to the attachment.
(f) Information Contact. Further infor-
under the jurisdiction of foreign goy- concerning this part may be ob-
ernments, and international organiza- tained by contacting the Office of Fed-
tions.
(c) OMB responsibilities. OMB is re- eral Financial Management, Office of
sponsible for: Management and Budget, Washington,
(1) Issuing and maintaining the guid- DC 20503, telephone (202) 395-3993.
ance in this part. (g) Termination Review Date. This part
(2) Interpreting the policy require- will have a policy review three years
ments in this part and providing assist- from the date of issuance.
ance to ensure effective and efficient
implementation. Subpart A—General
(3) Reviewing Federal agency regula-
tions implementing the guidance in §216.1 Purpose.
this part, as required by Executive This part establishes uniform admin-
Order 12866. istrative requirements for Federal
(4) Granting any deviations to Fed- grants and agreements awarded to in-
eral agencies from the guidance in this stitutions of higher education, hos-
part, as provided in §215.4. Exceptions pitals, and other non-profit organiza-
will only be made in particular cases tions. Federal awarding agencies shall
not impose additional or inconsistent
1 See 5 CFR 1310.9 for availability of OMB requirements, except as provided in
circulars. §§215.4, and 215.14 or unless specifically
78
OMB Circulars and Guidance §215.2
required by Federal statute or execu- money; other assistance in the form of
tive order. Non-profit organizations loans, loan guarantees, interest sub-
that implement Federal programs for sillies, or insurance; direct payments of
the States are also subject to State re- any kind to individuals; and, contracts
quirements. which are required to be entered into
§215.2 Definitions. and administered under procurement
laws and regulations.
(a) Accrued expenditures means the (I) Cash contributions means the re-
charges incurred by the recipient dur- cipient's cash outlay, including the
ing a given period requiring the provi- outlay of money contributed to the re-
sion of funds for: cipient by third parties.
(1) Goods and other tangible property (g) Closeout means the process by
received; which a Federal awarding agency de-
(2) Services performed by employees, termines that all applicable adminis-
contractors, subrecipients, and other
payees; and, trative actions and all required work of
(3) Other amounts becoming owed the award have been completed by the
under programs for which no current recipient and Federal awarding agency.
services or performance is required. (h) Contract means a procurement
(b) Accrued income means the sum of: contract under an award or subaward,
(1) Earnings daring a given period and a procurement subcontract under a
from: recipient's or subrecipient's contract.
(i) Services performed by the recipi- (i) Cost sharing or matching means
ent, and that portion of project or program
(ii) Goods and other tangible prop- costs not borne by the Federal Govern-
erty delivered to purchasers, and ment.
(2) Amounts becoming owed to the (j) Date of completion means the date
recipient for which no current services on which all work under an award is
or performance is required by the re- completed or the date on the award
cipient. document, or any supplement or
(c) Acquisition cost of equipment means amendment thereto, on which Federal
the net invoice price of the equipment, sponsorship ends.
including the cost of modifications, at- (k) Disallowed costs means those
tachments, accessories, or an'ciliary charges to an award that the Federal
apparatus necessary to make the prop- awarding agency determines to be un-
erty usable for the purpose for which it allowable, in accordance with the ap-
was acquired. Other charges, such as plicable Federal cost principles or
the cost of installation, transportation, other terms and conditions contained
taxes, duty or protective in-transit in- in the award.
surance, shall be included or excluded (1) Equipment means tangible non-
from the unit acquisition cost in ac-
cordance with the recipient's regular expendable personal property including
accounting practices. exempt property charged directly to
(d) Advance means a payment made the award having a useful life of more
by Treasury check or other appropriate than one year and an acquisition cost
payment mechanism to a recipient of $5,000 or more per unit. However,
upon its request either before outlays consistent with recipient policy, lower
are made by the recipient or through limits may be established.
the use. of predetermined payment (m) Excess property means property
schedules. under the control of any Federal
(e) Award means financial assistance awarding agency that, as determined
that provides support or stimulation to by the head thereof, is no longer re-
accomplish a public purpose. Awards quired for its needs or the discharge of
include grants and other agreements in its responsibilities.
the form of money or property in lieu (n) Exempt property means tangible
of money, by the Federal Government personal property acquired in whole or
to an eligible recipient. The term does in part with Federal funds, where the
not include: technical assistance, Federal awarding agency has statutory
which provides services instead of authority to vest title in the recipient
71
§215.2 2 CFR Ch. II (1-1-12 Edition)
without further obligation to the Fed- bursements for direct charges for goods
eral Government. An example of ex- and services, the amount of indirect ex-
empt property authority is contained pense incurred, the value of in-kind
in the Federal Grant and Cooperative contributions applied, and the net in-
Agreement Act (31 U.S.C. 6306), for crease (or decrease) in the amounts
property acquired under an award to owed by the recipient for goods and
conduct basic or applied research by a other property received, for services
non-profit institution of higher edu- performed by employees, contractors,
cation or non-profit organization subrecipients and other payees and
whose principal purpose is conducting other amounts becoming owed under
scientific research. programs for which no current services
(o) Federal awarding agency means or performance are required.
the Federal agency that provides an (v) Personal property means property
award to the recipient. of any kind except real property. It
(p) Federal funds authorized means the may be tangible, having physical exist-
total amount of Federal funds obli- ence, or intangible, having no physical
gated by the Federal Government for existence, such as copyrights, patents,
use by the recipient. This amount may or securities.
include any authorized carryover of un- (w) Prior approval means written ap-
obligated funds from prior funding pe- proval by an authorized official evi-
riods when permitted by agency regula- denting prior consent.
tions or agency implementing instruc- (x) Program income means gross in-
tions. come earned by the recipient that is di-
(q) Federal share of real property, rectly generated by a supported activ-
equipment, or supplies means that per- ity or earned as a result of the award
tentage of the property's acquisition (see exclusions in §215.24(e) and (h)).
costs and any improvement expendi- Program income includes, but is not
tures paid with Federal funds. limited to, income from fees for serv-
(r) Funding period means the period of ices performed, the use or rental of real
time when Federal funding is available or personal property acquired under
for obligation by the recipient. federally-funded projects, the sale of
(s) Intangible property and debt instru- commodities or items fabricated under
ments means, but is not limited to, an award, license fees and royalties on
trademarks, copyrights, patents and patents and copyrights, and interest on
patent applications and such property loans made with award funds. Interest
as loans, notes and other debt instru- earned on advances of Federal funds is
ments, lease agreements, stock and not program income. Except as other-
other instruments of property owner- wise provided in Federal awarding
ship, whether considered tangible or in- agency regulations or the terms and
tangible. conditions of the award, program in-
(t) Obligations means the amounts of come does not include the receipt of
orders placed, contracts and grants principal on loans, rebates, credits, dis-
awarded, services received and similar counts, etc., or interest earned on any
transactions during a given period that of them.
require payment by the recipient dur- (y) Project costs means all allowable
ing the same or a future period. costs, as set forth in the applicable
(u) Outlays or expenditures means Federal cost principles, incurred by a
charges made to the project or pro- recipient and the value of the contribu-
gram. They may be reported on a cash tions made by third parties in accom-
or accrual basis. For reports prepared plashing the objectives of the award
on a cash basis, outlays are the sum of during the project period.
cash disbursements for direct charges (z) Project period means the period es-
for goods and services, the amount of tablished in the award document dur-
indirect expense charged, the value of ing which Federal sponsorship begins
third party in-kind contributions ap- and ends.
plied and the amount of cash advances (aa) Property means, unless otherwise
and payments made to subrecipients. stated, real property, equipment, in-
For reports prepared on an accrual tangible property and debt instru-
basis, outlays are the sum of cash dis- ments.
80
OMB Circulars and Guidance §2 1 5.2
(bb) Real property means land, includ- money, or property in lieu of money,
ing land improvements, structures and made under an award by a recipient to
appurtenances thereto, but excludes an eligible subrecipient or by a sub-
movable machinery and equipment. recipient to a lower tier subrecipient.
(cc) Recipient means an organization The term includes financial assistance
receiving financial assistance directly when provided by any legal agreement,
from Federal awarding. agencies to even if the agreement is called a con-
carry out a project or program. The tract, but does not include procure-
term includes public and private insti- ment of goods and services nor does it
tutions of higher education, public and include any form of assistance which is
private hospitals, and other quasi-pub- excluded from the definition of
lic and private non-profit organizations "award" in §215.2(e).
such as, but not limited to, community (gg)Subrecipient means the legal enti-
action agencies, research institutes, ty to which a subaward is made and
educational associations, and health which is accountable to the recipient
centers. The term may include coin- for the use of the funds provided. The
mercial organizations, foreign or inter- term may include foreign or inter-
national organizations (such as agen- national organizations (such as agen-
cies of the United Nations) which are ties of the United Nations) at the dis-
recipients, subrecipients, or contrac- cretion of the Federal awarding agen
tors or subcontractors of recipients or cy.
subrecipients at the discretion of the (hh) Supplies means all personal prop-
Federal awarding agency. The term erty excluding equipment, intangible
does not include government-owned property, and debt instruments as de-
contractor-operated facilities or re- fined in this section, and inventions of
search centers providing continued a contractor conceived or first actually
support for mission-oriented, large= reduced to practice in the performance
scale programs that are government- of work under a funding agreement
owned or controlled, or are designated ("subject inventions"), as defined in 37
as federally-funded research and devel- CFR part 401, "Rights to Inventions
opment centers. Made by Nonprofit Organizations and
(dd) Research and development means Small Business Firms Under Govern-
all research activities, both basic and ment Grants, Contracts, and Coopera-
applied, and all development activities tive Agreements."
that are supported at universities, col- (ii) Suspension means an action by a
leges, and other non-profit institu- Federal awarding agency that tempo-
tions. "Research" is defined as a sys- rarily withdraws Federal sponsorship
tematic study directed toward fuller under an award, pending corrective ac-
scientific knowledge or understanding tion by the recipient or pending a deci-
of the subject studied. "Development" sion to terminate the award by the
is the systematic use of knowledge and Federal awarding agency. Suspension
understanding gained from research di- of an award is a separate action from
rected toward the production of useful suspension under Federal agency regu-
materials, devices, systems, or meth- lations implementing E.O. 12549 (51 FR
ods, including design and development 6370, 3 CFR, 1986 Comp., p. 189) and E.O.
of prototypes and processes. The term 12689 (54 FR 34131, 3 CFR, 1989 Comp., p.
research also includes activities in- 235), "Debarment and Suspension."
volving the training of individuals in (jj) Termination means the cancella-
research techniques where such activi- tion of Federal sponsorship, in whole or
ties utilize the same facilities as other in part, under an agreement at any
research and development activities time prior to the date of completion.
and where such activities are not in- (kk) Third party in-kind contributions
eluded in the instruction function, means the value of non-cash contribu-
(ee) Small awards means a grant or tions provided by non-Federal third
cooperative agreement not exceeding parties. Third party in-kind contribu-
the small purchase threshold fixed at tions may be in the form of real prop-
41 U.S.C. 403(11) (currently$25,000). erty, equipment, supplies and other ex-
(ff) Subaward means an award of fi- pendable property, and the value of
nancial assistance in the form of goods and services directly benefiting
81
§215.3 2 CFR Ch. II (1-1-12 Edition)
and specifically identifiable to thc utory. Exceptions on a case-by-case
project or program. basis may also be made by Federal
(11) Unliquidated obligations, for finan- awarding agencies.
cial reports prepared on a cash basis,
means the amount of obligations in- §215.5 Subawards.
curred by the recipient that have not Unless sections of this part specifi-
been paid. For reports prepared on an cally exclude subrecipients from cov-
accrued expenditure basis, they rep- erage, the provisions of this part shall
resent the amount of obligations in- be applied to subrecipients performing
curred by the recipient for which at work under awards if such subrecipi-
outlay has not been recorded. ents are institutions of higher edu-
(mm) Unobligated balance means the cation, hospitals or other non-profit or-
portion of the funds authorized by the ganizations. State and local govern-
Federal awarding agency that has not ment subrecipients are subject to the
been obligated by the recipient and is provisions of regulations implementing
determined by deducting the cumu- the grants management common rule,
lative obligations from the cumulative "Uniform Administrative Require-
funds authorized. ments for Grants and Cooperative
(nn) Unrecovered indirect cost means Agreements to State and Local Gov-
the difference between the amount ernments," published at 7 CFR parts
awarded and the amount which could 3015 and 3016, 10 CFR part 600, 13 CFR
have been awarded under the recipi- part 143, 15 CFR part 24, 20 CFR part
ent's approved negotiated indirect cost 437, 22 CFR part 135, 24 CFR parts 44, 85,
rate. 111, 511, 570, 571, 575, 590, 850, 882, 905,
(oo) Working capital advance means a 941, 968, 970, and 990, 28 CFR part 66, 29
procedure whereby funds are advanced CFR parts 97 and 1470, 32 CFR part 278,
to the recipient to cover its estimated 34 CFR parts 74 and 80, 36 CFR part
disbursement needs for a given initial 1207, 38 CFR part 43, 40 CFR parts 30, 31,
period. and 33, 43 CFR part 12, 44 CFR part 13,
§216.3 Effect on other issuances. 45 CFR parts 74, 92, 602, 1157, 1174, 1183,
1234, and 2015, and 49 CFR part 18.
For awards subject to this part, all
administrative requirements of codi- [69 FR 26281, May 11, 2004, as amended at 70
fied FR 51880, Aug.21.,20051
program regulations, program
manuals, handbooks and other non- Subpart B-Pre-Award
regulatory materials which are incon P
sistent with the requirements of this Requirements
part shall be superseded, except to the
extent they are required by statute, or §216.10 Purpose.
authorized in accordance with the devi- Sections 215.11 through 215.17 pre-
ations provision in §215.4. scribe forms and instructions and other
§215.4 Deviations. pre-award matters to be used in apply-
ing for Federal awards.
The Office of Management and Budg-
et (OMB) may grant exceptions for §215.11 Pre-award policies.
M
classes of grants or recipients subject (a) Use of Grants and Cooperative
to the requirements of this part when Agreements, and Contracts. In each in-
exceptions are not prohibited by stat- stance, the Federal awarding agency
ute. However, in the interest of max- shall decide on the appropriate award
imum uniformity, exceptions from the instrument (i.e., grant, cooperative
requirements of this part shall be per- agreement, or contract). The Federal
mitted only in unusual circumstances. Grant and Cooperative Agreement Act
Federal awarding agencies may apply (31 U.S.C. 6301-08) governs the use of
more restrictive requirements to a grants, cooperative agreements and
class of recipients when approved by contracts. A grant or cooperative
OMB. Federal awarding agencies may agreement shall be used only when the
apply less restrictive requirements principal purpose of a transaction is to
when awarding small awards, except accomplish a public purpose of support
for those requirements which are stat- or stimulation authorized by Federal
82
OMB Circulars and Guidance §215.15
statute. The statutory criterion for agency regulations implementing E.O.s
choosing between grants and coopera- 12549 and 12689, "Debarment and Sus-
tive agreements is that for the latter, pension." Under those regulations, cer-
"substantial involvement is expected taro parties who are debarred, sus-
between the executive agency and the pended or otherwise excluded may not
State, local government, or other re- be participants or principals in Federal
cipient when carrying out the activity assistance awards and subawards, and
contemplated in the agreement." Con- in certain contracts under those
tracts shall be used when the principal awards and subawards.
purpose is acquisition of property or [70 FR,51879, Aug.31,2005J
services for the direct benefit or use of
the Federal Government. §215.14 Special award conditions.
(b) Public Notice and Priority Set- If an applicant or recipient: has a his-
ting. Federal awarding agencies shall tory of poor performance, is not finan-
notify the public of its intended fund- cially stable, has a management sys-
ing priorities for discretionary grant tern that does not meet the standards
programs, unless funding priorities are prescribed in this part, has not eon-
established by Federal statute. formed to the terms and conditions of
§215.12 Forms for applying for Fed. a previous award, or is not otherwise
eral assistance. responsible, Federal awarding agencies
(a) Federal awarding agencies shall may impose additional requirements as
comply with the applicable report needed, provided that such applicant or
clearance requirements of 5 CFR part recipient is notified in writing as to:
the nature of the additional require-
1320, "Controlling Paperwork Burdens ments, the reason why the additional
on the Public," with regard to all requirements are being imposed, the
forms used by the Federal awarding nature of the corrective action needed,
agency in place of or as a supplement the time allowed for completing the
to the Standard Form 424 (SF-424) se- corrective actions, and the method for
ries. requesting reconsideration of the addi-
(b) Applicants shall use the SF-424 tional requirements imposed. Any spe-
series or those forms and instructions cial conditions shall be promptly re-
prescribed by the Federal awarding moved once the conditions that
agency. prompted them have been corrected.
(c) For Federal programs covered by
E.O. 12372, "Intergovernmental Review §215.15 Metric system of measure
of Federal Programs," (47 FR 30959, 3 ment.
CFR, 1982 Comp., p. 197) the applicant The Metric Conversion Act, as
shall complete the appropriate sections amended by the Omnibus Trade and
of the SF-424 (Application for Federal Competitiveness Act (15 U.S.C. 205) de-
Assistance) indicating whether the ap- dares that the metric system is the
plication was subject to review by the preferred measurement system for U.S.
State Single Point of Contact (SPOC). trade and commerce. The Act requires
The name and address of the SPOC for each Federal agency to establish a date
a particular.State can be obtained from or dates in consultation with the See-
the Federal awarding agency or the retary of Commerce, when the metric
Catalog of Federal Domestic Assistance. system of measurement will be used in
The SPOC shall advise the applicant the agency's procurements, grants, and
whether the program for which applica- other business-related activities. Met-
tion is made has been selected by that ric implementation may take longer
State for review. where the use of the system is initially
(d) Federal awarding agencies that do impractical or likely to cause signifi-
not use the SF-424 form should indi- cant inefficiencies in the accomplish-
cate whether the application is subject ment of federally-funded activities.
to review by the State under E.O. 12372. Federal awarding agencies shall follow
§215.13 Debarment and suspension. the provisions of E.O. 12770, "Metric
Usage in Federal Government Pro-
Federal awarding agencies and re- grams" (56 FR 35801, 3 CFR, 1991 Comp.,
cipients shall comply with Federal p. 343),
8;
§215.16 2 CFR Ch. II (1-1-12 Edition)
§215.16 Resource Conservation and data to performance data and develop
Recovery Act. unit cost information whenever prac-
Under the Act, any State agency or tical.
agency of a political subdivision of a (b) Recipients' financial management
State which is using appropriated Fed- systems shall provide for the following.
eral funds must comply with section (1) Accurate, current and complete
6002. Section 6002 requires that pref- disclosure of the financial results of
erence be given in procurement pro- each federally-sponsored project or
grams to the purchase of specific prod- program in accordance with the report-
ucts containing recycled materials ing requirements set forth in §215.52. If
identified in guidelines developed by a Federal awarding agency requires re-
the Environmental Protection Agency porting on an accrual basis from a re-
(EPA) (40 CFR parts 247-254). Accord- cipient that maintains its records on
ingly, State and local institutions of other than an accrual basis, the recipi-
higher education, hospitals, and non- ent shall not be required to establish
profit organizations that receive direct an accrual accounting system. These
Federal awards or other Federal funds recipients may develop such accrual
shall give preference in their procure- data for its reports on the basis of an
ment programs funded with Federal analysis of the documentation on hand.
funds to the purchase of recycled prod- (2) Records that identify adequately
ucts pursuant to the EPA guidelines: the source and application of funds for
federally-sponsored activities. These
§215.17 Certifications and representa- records shall contain information per-
tions. taming to Federal awards, authoriza-
Unless prohibited by statute or codi- tions, obligations, unobligated bal-
fled regulation, each Federal awarding antes, assets, outlays, income and in-
agency is authorized and encouraged to terest.
allow recipients to submit certifi- (3) Effective control over and ac-
cations and representations required countability for all funds, property and
by statute, executive order, or regula- other assets. Recipients shall ade-
tion on an annual basis, if the recipi- quately safeguard all such assets and
ents have ongoing and continuing rela- assure they are used solely for author-
tionships with the agency. Annual cer- ized purposes.
tifications and representations shall be (4) Comparison of outlays with budg-
signed by responsible officials with the et amounts for each award. Whenever
authority to ensure recipients' compli- appropriate, financial information
ance with the pertinent requirements. should be related to performance and
unit cost data.
Subpart C—Post Award (5) Written procedures to minimize
Requirements the time elapsing between the transfer
of funds to the recipient from the U.S.
FINANCIAL AND PROGRAM MANAGEMENT Treasury and the issuance or redemp-
tion of checks, warrants or payments
§215.20 Purpose of financial and pro- by other means for program purposes
gram management. by the recipient. To the extent that the
Sections 215.21 through 215.28 pre- provisions of the Cash Management Im-
scribe standards for financial manage- provement Act (CMIA) (Pub. L. 101-453)
ment systems, methods for making govern, payment methods of State
payments and rules for: satisfying cost agencies, instrumentalities, and fiscal
sharing and matching requirements, agents shall be consistent with CMIA
accounting for program income, budget Treasury-State Agreements or the
revision approvals, making audits, de- CMIA default procedures codified at 31
termining allowability of cost, and es- CFR part 205, "Withdrawal of Cash
tablishing fund availability. from the Treasury for Advances under
§215.21 Standards for financial man- Federal Grant and Other Programs."
systems. (6) Written procedures for deter-
agementmining the reasonableness, allocability
(a) Federal awarding agencies shall and allowability of costs in accordance
require recipients to relate financial with the provisions of the applicable
84
OMB Circulars and Guidance §215.22
Federal cost principles and the terms the actual disbursements by the recipi-
and conditions of the award. ent organization for direct program or
(7) Accounting records including cost project costs and the proportionate
accounting records that are supported share of any allowable indirect costs,
by source documentation. (c) Whenever possible, advances shall
(c) Where the Federal Government be consolidated to cover anticipated
guarantees or insures the repayment of cash needs for all awards made by the
money borrowed by the recipient, the Federal awarding agency to the recipi-
Federal awarding agency, at its discre- ent.
tion, may require adequate bonding (1) Advance payment mechanisms in-
and insurance if the bonding and insur- elude, but are not limited to, Treasury
ance requirements of the recipient are check and electronic funds transfer.
not deemed adequate to protect the in- (2) Advance payment mechanisms are
terest of the Federal Government. subject to 31 CFR part 205.
(d) The Federal awarding agency may (3) Recipients shall be authorized to
require adequate fidelity bond coverage submit requests for advances and reim-
where the recipient lacks sufficient bursements at least monthly when
coverage to protect the Federal Gov- electronic fund transfers are not used.
ernment's interest. (d) Requests for Treasury cheek ad-
(e) Where bonds are required in the vance payment shall be submitted on
situations described above, the bonds SF=270, "Request for Advance or Reim-
shall be obtained from companies hold- bursement," or other forms as may be
ing certificates of authority as accept- authorized by OMB. This form is not to
able sureties, as prescribed in 31 CFR be used when Treasury check advance
part 223, "Surety Companies Doing payments are made to the recipient
Business with the United States." automatically through the use of a pre-
determined payment schedule or if pre-
cluded by special Federal awarding
(a) Payment methods shall minimize agency instructions for electronic
the time elapsing between the transfer funds transfer.
of funds from the United States Treas- (e) Reimbursement is the preferred
ury and the issuance or redemption of method when the requirements in
checks, warrants, or payment by other §215.12(b) cannot be met. Federal
means by the recipients. Payment awarding agencies may also use this
methods of State agencies or instru- method on any construction agree-
mentalities shall be consistent with ment, or if the major portion of the
Treasury-State CMIA agreements or construction project is accomplished
default procedures codified at 31 CFR through private market financing or
part 205. Federal loans, and the Federal assist-
(b) Recipients are to be paid in ad- ance constitutes a minor portion of the
vance, provided they maintain or dem- project.
onstrate the willingness to maintain: (1) When the reimbursement method
(1) Written procedures that minimize is used, the Federal awarding agency
the time elapsing between the transfer shall make payment within 30 days
of funds and disbursement by the re- after receipt of the billing, unless the
cipient, and billing is improper,
(2) Financial management systems (2) Recipients shall be authorized to
that meet the standards for fund con- submit request for reimbursement at
trol and accountability as established least monthly when electronic funds
in §215.21. Cash advances to a recipient transfers are not used.
organization shall be limited to the (f) If a recipient cannot meet the cri-
minimum amounts needed and be teria for advance payments and the
timed to be in accordance with the ac- Federal awarding agency has deter-
tual, immediate cash requirements of mined that reimbursement is not fea-
the recipient organization in carrying sible because the recipient lacks suffi-
out the purpose of the approved pro- dent working capital, the Federal
gram or project. The timing and awarding agency may provide cash on a
amount of cash advances shall be as working capital advance basis. Under
close as is administratively feasible to this procedure, the Federal awarding
§215.22 2 CFR Ch. II (1-1-12 Edition)
agency shall advance cash to the re- (2) Advances of Federal funds shall be
cipient to cover its estimated disburse- deposited and maintained in insured
ment needs for an initial period gen- accounts whenever possible,
erally geared to the awardee's dis- (j) Consistent with the national goal
bursing cycle. Thereafter, the Federal of expanding the opportunities for
awarding agency shall reimburse the women-owned and minority-owned
recipient for its actual cash disburse- business enterprises, recipients shall be
ments. The working capital advance encouraged to use women-owned and
method of payment shall not be used minority-owned banks (a bank which is
for recipients unwilling or unable to owned at least 50 percent by women or
provide timely advances to their sub- minority group members).
recipient to meet the subrecipient's ac- (k) Recipients shall maintain ad-
tual cash disbursements. vances of Federal funds in interest
(g) To the extent available, recipi- bearing accounts, unless paragraphs
ents shall disburse funds available from (k)(1), (2) or (3) of this section apply.
repayments to and interest earned on a (1) The recipient receives less than
revolving fund, program income, re- $120,000 in Federal awards per year.
bates, refunds, contract settlements, (2) The best reasonably available in-
audit recoveries and interest earned on terest bearing account would not be ex-
such funds before requesting additional petted to earn interest in excess of$250
cash payments. per year on Federal cash balances.
(h) Unless otherwise required by stat- (3) The depository would require an
ute, Federal awarding agencies shall average or minimum balance so high
not withhold payments for proper that it would not be feasible within the
charges made by recipients at any time expected Federal and non-Federal cash
during the project period unless para- resources.
graphs (h)(1) or (2) of this section (1) For those entities where CMIA
apply. and its implementing regulations at 31
(1) A recipient has failed to comply CFR part 205 do not apply, interest
with the project objectives, the terms earned on Federal advances deposited
and conditions of the award, or Federal in interest bearing accounts shall be
reporting requirements. remitted annually to Department of
(2) The recipient or subrecipient is Health and Human Services, Payment
delinquent in a debt to the United Management System, Rockville, MD
States as defined in OMB Circular A- 20852. Interest amounts up to $250 per
129, "Managing Federal Credit Pro- year may be retained by the recipient
grams." Under such conditions, the for administrative expense. State uni-
Federal awarding agency may, upon versities and hospitals shall comply
reasonable notice, inform the recipient with CMIA, as it pertains to interest. If
that payments shall not be made for an entity subject to CMIA uses its own
obligations incurred after a specified funds to pay pre-award costs for discre-
date until the conditions are corrected tionary awards without prior written
or the indebtedness to the Federal Gov- approval from the Federal awarding
ernment is liquidated. agency, it waives its right to recover
(i) Standards governing the use of the interest under CMIA.
banks and other institutions as deposi- (m) Except as noted elsewhere in this
tories of funds advanced under awards part, only the following forms shall be
are as follows. authorized for the recipients in re-
(1) Except for situations described in questing advances and reimburse-
paragraph (i)(2) of this section, Federal ments. Federal agencies shall not re-
awarding agencies shall not require quire more than an original and two
separate depository accounts for funds copies of these forms.
provided to a recipient or establish any (1) SF-270, Request for Advance or
eligibility requirements for deposi- Reimbursement. Each Federal award-
tories for funds provided to a recipient. ing agency shall adopt the SF-270 as a
However, recipients must be able to ac- standard form for all nonconstruction
count for the receipt, obligation and programs when electronic funds trans-
expenditure of funds. fer or predetermined advance methods
OMB Circulars and Guidance §215.23
are not used. Federal awarding agen- (1) The certified value of the remain-
cies, however, have the option of using ing life of the property recorded in the
this form for construction programs in recipient's accounting records at the
lieu of the SF-271, "Outlay Report and time of donation.
Request for Reimbursement for Con- (2) The current fair market value.
struction Programs." However, when there is sufficient jus-
(2) SF=271, Outlay Report and Re- tification, the Federal awarding agen-
quest for Reimbursement for Construe- cy may approve the use of the current
tion Programs. Each Federal awarding fair market value of the donated prop-
agency shall adopt the SF-271 as the erty, even if it exceeds the certified
standard form to be used for requesting value at the time of donation to the
reimbursement for construction pro- project.
grams. However, a Federal awarding (d) Volunteer services furnished by
agency may substitute the SF-270 professional and technical personnel,
when the Federal awarding agency de- consultants, and other skilled and un-
termines that it provides adequate in- skilled labor may be counted as cost
formation to meet Federal needs. sharing or matching if the service is an
integral and necessary part of an ap-
§21523 Cost sharing or matching. proved project .or program. Rates for
(a) All contributions, including cash volunteer services shall be consistent
and third party in-kind, shall be ac- with those paid for similar work in the
cepted as part of the recipient's cost recipient's organization. In those in-
sharing or matching when such con- stances in which the required skills are
tributions meet all of the following cri- not found in the recipient organization,
teria. rates shall be consistent with those
(1) Are verifiable from the recipient's paid for similar work in the labor mar-
records. ket in which the recipient competes for
(2) Are not included as contributions the kind of services involved. In either
for any other federally-assisted project case, paid fringe benefits that are rea-
or program. sonable, allowable, and allocable may
(3) Are necessary and reasonable for be included in the valuation.
proper and efficient accomplishment of (e) When an employer other than the
project or program objectives. recipient furnishes the services of an
(4) Are allowable under the applica- employee, these services shall be val-
ble cost principles. ued at the employee's regular rate of
(5) Are not paid by the Federal Gov- pay (plus an amount of fringe benefits
ernment under another award, except that are reasonable, allowable, and al-
where authorized by Federal statute to locable, but exclusive of overhead
be used for cost sharing or matching. costs), provided these services are in
(6) Are provided for in the approved the same skill for which the employee
budget when required by the Federal is normally paid.
awarding agency. (f) Donated supplies may include
(7) Conform to other provisions of such items as expendable equipment,
this part, as applicable. office supplies, laboratory supplies or
(b) Unrecovered indirect costs may be workshop and classroom supplies.
included as part of cost sharing or Value assessed to donated supplies in--
matching only with the prior approval eluded in the cost sharing or matching
of the Federal awarding agency. share shall be reasonable and shall not
(c) Values for recipient contributions exceed the fair market value of the
of services and property shall be estab- property at the time of the donation.
lished in accordance with the applica- (g) The method used for determining
ble cost principles. If a Federal award- cost sharing or matching for donated
ing agency authorizes recipients to do- equipment, buildings and land for
nate buildings or land for construction/ which title passes to the recipient may
facilities acquisition projects or long- differ according to the purpose of the
term use, the value of the donated award, if paragraphs (g)(1) or (2) of this
property for cost sharing or matching section apply.
shall be the lesser of paragraphs (c)(1) (1) If the purpose of the award is to
or (2) of this section. assist the recipient in the acquisition
87
§215.24 2 CFR Ch. II (1-1-12 Edition)
of equipment, buildings or land, the related to projects financed in whole or
total value of the donated property in part with Federal funds.
may be claimed as cost sharing or (b) Except as provided in paragraph
matching. (h) of this section, program income
(2) If the purpose of the award is to earned during the project period shall
support activities that require the use be retained by the recipient and, in ac-
of equipment, buildings or land, nor- cordance with Federal awarding agency
mally only depreciation or use charges regulations or the terms and condi-
for equipment and buildings may be tions of the award, shall be used in one
made. However, the full value of equip- or more of the ways listed in the fol-
ment or other capital assets and fair lowing.
rental charges for land may be allowed, <1) Added to funds committed to the
provided that the Federal awarding project by the Federal awarding agency
agency has approved the charges. and recipient and used to further eligi-
(h) The value of donated property ble project or program objectives.
shall be determined in accordance with (2) Used to finance the non-Federal
the usual accounting policies of the re- share of the project or program.
cipient, with the following qualifica- (3) Deducted from the total project or
tions. program allowable cost in determining
(1) The value of donated land and the net allowable costs on which the
buildings shall not exceed its fair mar- Federal share of costs is based.
ket value at the time of donation to (c) When an agency authorizes the
the recipient as established by an inde- disposition of' program income as de-
pendent appraiser (e.g., certified real scribed in paragraphs (b.)(1) or (b)(2) of
property appraiser or General Services this section, program income in excess
Administration representative) and of any limits stipulated shall be used in
certified by a responsible official of the
accordance with paragraph (b)(3) of
recipient. this section.
(2) The value of donated equipment (d) In the event that the Federal
shall not exceed the fair market value awarding agency does not specify in its
of equipment of the same age and con- regulations or the terms and condi-
dition at the time of donation, tions of the award how program income
(3) The value of donated space shall is to be used, paragraph (b)(3) of this
not exceed the fair rental value of com- section shall apply automatically to
parable space as established by an inde-
endent appraisal of comparable space all projects or programs except re-
p facilities in a search. For awards that support re-
pnd en
privately-owned search, paragraph (b)(1) of this section
building in the same locality: shall apply automatically unless the
(4) The value of loaned equipment awarding agency indicates in the terms
shall not exceed its fair rental value. and conditions another alternative on
(5) The following requirements per- the award or the recipient is subject to
taro to the recipient's supporting special award conditions, as indicated
records for in-kind contributions from in §215.14.
third parties. (e) Unless Federal awarding agency
(i) Volunteer services shall be docu- regulations or the terms and condi-
mented and, to the extent feasible, sup- tions of the award provide otherwise,
ported by the same methods used by recipients shall have no obligation to
the recipient for its own employees. the Federal Government regarding pro-
(ii) The basis for determining the gram income earned after the end of
valuation for personal service, mate- the project period.
rial, equipment, buildings and land (f) If authorized by Federal awarding
shall be documented. agency regulations or the terms and
§215.24 Program income. conditions of the award, costs incident
to the generation of program income
(a) Federal awarding agencies shall may be deducted from gross income to
apply the standards set forth in this determine program income, provided
section in requiring recipient organiza- these costs have not been charged to
tions to account for program income the award.
8i3
OMB Circulars and Guidance §215.25
(g) Proceeds from the sale of property (6) The inclusion, unless waived by
shall be handled in accordance with the the Federal awarding agency, of costs
requirements of the Property Stand- that require prior approval in accord-
ards (see §215.30 through §215.37). ance with any of the following, as ap-
(h) Unless Federal awarding agency plieable:
regulations or the terms and condition (i) 2 CFR part 220, "Cost Principles
of the award provide otherwise, recipi- for Educational Institutions (OMB Cir-
ents shall have no obligation to the cular A-21);"
Federal Government with respect to (ii) 2 CFR part 230, "Cost Principles
program income earned from license for Non-Profit Organizations (OMB Cir-
fees and royalties for copyrighted ma- cular A-122);"
terial, patents, patent applications, (iii) 45 CFR part 74, Appendix E,
trademarks, and inventions produced "Principles for Determining Costs Ap-
under an award. However, Patent and plicable to Research and Development
Trademark Amendments (35 U.S.C. 18) under Grants and Contracts with Hos-
apply to inventions made under an ex- pitals;" and
perimental, developmental, or research (iv) 48 CFR part 31, "Contract Cost
award. Principles and Procedures."
§215.25 Revision of budget mud pro. (7) The transfer of funds allotted for
gram plans. training allowances (direct payment to
trainees) to other categories of ex-
(a) The budget plan is the financial pense.
expression of the project or program as (8) Unless described in the applica-
approved during the award process. It tion and funded in the approved
may include either the Federal and awards, the subaward, transfer or con-
non-Federal share, or only the Federal tracting out of any work under an
share, depending upon Federal award- award. This provision does not apply to
ing agency requirements. It shall be re- the purchase of supplies, material,
lated to performance for program eval- equipment or general support services,
uation purposes whenever appropriate.
(b) Recipients are required to report (d) No other prior approval require
ments for specific items may be im-
deviations from budget and program posed unless a deviation has been ap-
plans, and request prior approvals for proved by OMB.
budget and program plan revisions, in (e) Except for requirements listed in
accordance with this section. paragraphs (c)(1) and (c)(4) of this see-
(c) For nonconstruction awards, re- tion, Federal awarding agencies are au-
cipients shall request prior approvals thorized, at their option, to waive cost-
from Federal awarding agencies for one related and administrative prior writ-
or more of the following program or ten approvals required by 2 CFR parts
budget related reasons. 220 and 230 (OMB Circulars A=21 and A-
(1) Change in the scope or the objec- 122). Such waivers may include author-
tive of the project or program (even if izing recipients to do any one or more
there is no associated budget revision of the following.
requiring prior written approval).
(1) Incur pre-award costs 90 calendar
(2) Change in a key person specified
days prior to award or more than 90
in the application or award document. calendar days with the prior approval
(3) The absence for more than three of the Federal awarding agency. All
months, or a 25 percent reduction in pre-award costs are incurred at the re-
time devoted to the project, by the ap- cipient's risk (i.e., the Federal award-
proved project director or principal in- ing agency is under no obligation to re-
vestigator. imburse such costs if for any reason
(4) The need for additional Federal the recipient does not receive an award
funding. or if the award is less than anticipated
(5) The transfer of amounts budgeted and inadequate to cover such costs).
for indirect costs to absorb increases in (2) Initiate a one-time extension of
direct costs, or vice versa, if approval the expiration date of the award of up
is required by the Federal awarding to 12 months unless one or more of the
agency. following conditions apply. For one-
89
§215.26 2 CFR Ch. II (1-1-12 Edition)
time extensions, the recipient must no- (3) A revision is desired which in-
tify the Federal awarding agency in volves specific costs for which prior
writing with the supporting reasons written approval requirements may be
and revised expiration date at least 10 imposed consistent with applicable
days before the expiration date speci- OMB cost principles listed in§215.27.
fied in the award. This one-time exten- (i) No other prior approval require-
sion may not be exercised merely for ments for specific items may be im-
the purpose of using unobligated bal- posed unless a deviation has been ap-
ances. proved by OMB.
(i)The terms and conditions of award (j) When a Federal awarding agency
prohibit the extension. makes an award that provides support
(ii) The extension requires additional for both construction and nonconstruc-
Federal funds. tion work, the Federal awarding agen-
(iii) The extension involves any cy may require the recipient to request
change in the approved objectives or prior approval from the Federal award-
scope of the project. ing agency before making any fund or
(3) Carry forward unobligated bal- budget transfers between the two types
ances to subsequent funding periods. of work supported.
(4) For awards that support research, (k) For both construction and non-
unless the Federal awarding agency construction awards, Federal awarding
provides otherwise in the award or in agencies shall require recipients to no-
the agency's regulations, the prior ap- tify the Federal awarding agency in
proval requirements described in this writing promptly whenever the amount
paragraph (e) are automatically waived of Federal authorized funds is expected
(i.e., recipients need not obtain such to exceed the needs of the recipient for
prior approvals) unless one of the con- the project period by more than $5000
ditions included in paragraph (e)(2) ap- or five percent of the Federal award,
plies. whichever is greater. This notification
(f) The Federal awarding agency shall not be required if an application
may, at its option, restrict the transfer for additional funding is submitted for
of funds among direct cost categories a continuation award.
or programs, functions and activities (1) When requesting approval for
for awards in which the Federal share budget revisions, recipients shall use
of the project exceeds $100,000 and the the budget forms that were used in the
cumulative amount of such transfers application unless the Federal award
exceeds or is expected to exceed 10 per- ing agency indicates a letter of request
cent of the total budget as last ap- suffices.
proved by the Federal awarding agen- (m) Within 30 calendar days from the
cy. No Federal awarding agency shall date of receipt of the request for budg-
permit a transfer that would cause any et revisions, Federal awarding agencies
Federal appropriation or part thereof shall review the request and notify the
to be used for purposes other than recipient whether the budget revisions
those consistent with the original in- have been approved. If the revision is
tent of the appropriation, still under consideration at the end of
(g) All other changes to nonconstruc- 30 calendar days, the Federal awarding
tion budgets, except for the changes de- agency shall inform the recipient in
scribed in paragraph (j) of this section, writing of the date when the recipient
do not require prior approval. may expect the decision.
(h) For construction awards, recipi- [69 FR 26281, May 11, 2004, as amended at 70
ents shall request prior written ap- FR 51880, Aug. 31,20051
proval promptly from Federal awarding
agencies for budget revisions whenever §215.26 Non-Federal audits.
paragraphs (h)(1), (2) or (3) of this sec- (a) Recipients and subrecipients that
tion apply. are institutions of higher education or
(1) The revision results from changes other non-profit organizations (includ-
in the scope or the objective of the ing hospitals) shall be subject to the
project or program. audit requirements contained in the
(2) The need arises for additional Single Audit Act Amendments of 1996
Federal funds to complete the project, (31 U.S.C. 7501-7507) and revised OMB
�L)
OMB Circulars and Guidance §215.29
Circular A-133, "Audits of States, visions of the Federal Acquisition Reg-
Local Governments, and Non-Profit Or- ulation (FAR) at 48 CFR part 31.
ganizations."
(b) State and local governments shall [70 FR 51880, Aug.. 31,2005]
be subject to the audit requirements §215.28 Period of availability of funds.
contained in the Single Audit Act
Amendments of 1996 (31 U.S.C. 7501- Where a funding period is specified, a
7507) and revised OMB Circular A-133, recipient may charge to the grant only
"Audits of States, Local Governments, allowable costs resulting from obliga-
and Non-Profit Organizations." tions incurred during the funding author-
(c) pe-
For-profit hospitals not covered riod and any pre-award costs by the audit provisions of revised OMB ized by the Federal awarding agency.
Circular A-133 shall be subject to the §215.29 Conditional exemptions.
audit requirements of the Federal
awarding agencies. (a) OMB authorizes conditional ex-
(d) Commercial organizations shall emption from OMB administrative re-
be subject to the audit requirements of quirements and cost principles circu-
the Federal awarding agency or the lars for certain Federal programs with
statutorily-authorized consolidated
prime recipient as incorporated into planning and consolidated administra-
the award document. tive funding, that are identified by a
§215.27 Allowable costs. Federal agency and approved by the
head of the Executive department or
For each kind of recipient, there is a establishment. A Federal agency shall
set of Federal principles for deter- consult with OMB during its consider-
mining allowable costs. Allowability of ation of whether to grant such an ex-
costs shall be determined in accord- emption.
ance with the cost principles applicable (b) To promote efficiency in State
to the entity incurring the costs. Thus, and local program administration,
allowability of costs incurred by State, when Federal non-entitlement pro-
local or federally-recognized Indian grams with common purposes have spe-
tribal governments is determined in cific statutorily-authorized consoli-
accordance with the provisions of 2 dated planning and consolidated ad-
CFR part 225, "Cost Principles for ministrative funding and where most of
State, Local, and Indian Tribal Govern- the State agency's resources come
ments (OMB Circular A-87." The allow- from non-Federal sources, Federal
ability of costs incurred by non-profit agencies may exempt these covered
organizations is determined in accord- State-administered, non-entitlement
ance with the provisions of 2 CFR part grant programs from certain OMB
230, "Cost Principles for Non-Profit Or- grants management requirements. The
ganizations (OMB Circular A-122)." The exemptions would be from:
allowability of costs incurred by insti- (1) The requirements in 2 CFR part
tutions of higher education is deter- 225, "Cost Principles for State, Local,
mined in accordance with the provi- and Indian Tribal Governments (OMB
sions of 2 CFR part 220, "Cost Prin- Circular A-87)" other than the
ciples for Educational Institutions allocability of costs provisions that are
(OMB Circular A-21)." The allowability contained in subsection C.3 of appendix
of costs incurred by hospitals is deter- A to that part;
mined in accordance with the provi- (2) The requirements in 2 CFR part
sions of appendix E of 45 CFR part 74, 220, "Cost Principles for Educational
"Principles for Determining Costs Ap- Institutions (OMB Circular A=21)"
plicable to Research and Development other than the allocability of costs pro-
Under Grants and Contracts with Hos- visions that are contained in paragraph
pitals." The allowability of costs in- C.4 in section C of the appendix to that
curred by commercial organizations part;
and those non-profit organizations list- (3) The requirements in 2 CFR part
ed in Attachment C to Circular A-122 is 230, "Cost Principles for Non-Profit Or-
determined in accordance with the pro- ganizations (OMB Circular A-122)"
91
§215.30 2 CFR Ch. II (1-1--12 Edition)
other than the allocability of costs pro- §215.31 Insurance coverage.
visions that are in paragraph A.4 in Recipients shall, at a minimum, pro-
section A of appendix A to that part;
(4) The administrative requirements vide the equivalent insurance coverage
for real property and equipment ac-
provisions of part 215 (OMB Circular A- quired with Federal funds as provided
110, "Uniform Administrative Require- to property owned by the recipient.
ments for Grants and Agreements with Federally-owned property need not be
Institutions of Higher Education, Hos- insured unless required by the terms
pitals, and Other Non-Profit Organiza- and conditions of the award.
tions,"); and
(5) The agencies' grants management §215.32 Real property.
common rule (see §215.5). Each Federal awarding agency shall
(c) When a Federal agency provides prescribe requirements for recipients
this flexibility, as a prerequisite to a concerning the use and disposition of
State's exercising this option, a State real property acquired in whole or in
must adopt its own written fiscal and part under awards. Unless otherwise
administrative requirements for ex- provided by statute, such require-
pending and accounting for all funds, ments, at a minimum, shall contain
which are consistent with the provi- the following.
sions of 2 CFR part 225, "Cost Prin- (a) Title to real property shall vest in
ciples for State, Local, and Indian the recipient subject to the condition
Tribal Governments (OMB Circular A- that the recipient shall use the real
87)" and extend such policies to all sub- property for the authorized purpose of
recipients. These fiscal and administra- the project as long as it is needed and
tive requirements must be sufficiently shall not encumber the property with-
specific to ensure that: funds are used out approval of the Federal awarding
in compliance with all applicable Fed- agency.
eral statutory and regulatory provi- (b) The recipient shall obtain written
sions, costs are reasonable and nec- approval by the Federal awarding agen-
essary for operating these programs, cy for the use of real property in other
and funds are not be used for general federally-sponsored projects when the
expenses required to carry out other recipient determines that the property
responsibilities of a State or its sub- is no longer needed for the purpose of
recipients. the original project. Use in other
projects shall be limited to those under
[69 FR 26281, May 11, 2004, as amended at 70 federally-sponsored projects (i.e.,
FR 51881, Aug.31, 2005) awards) or programs that have pur-
PROPERTY STANDARDS poses consistent with those authorized
for support by the Federal awarding
§215.30 Purpose of property stand- agency.
ards. (c) When the real property is no
Sections 215.31 through 215.37 set longer needed as provided in para-
forth uniform standards governing graphs (a) and (b) of this section, the
management and disposition of prop- recipient shall request disposition in-
erty furnished by the Federal Govern- structions from the Federal awarding
went whose cost was charged to a agency or its successor Federal award-
ing agency. The Federal awarding
project supported by a Federal award. agency shall observe one or more of the
Federal awarding agencies shall re- following disposition instructions.
quire recipients to observe these stand- (1) The recipient may be permitted to
ards under awards and shall not impose retain title without further obligation
additional requirements, unless specifi- to the Federal Government after it
cally required by Federal statute. The compensates the Federal Government
recipient may use its own property for that percentage of the current fair
management standards and procedures market value of the property attrib-
provided it observes the provisions of utable to the Federal participation in
§215.31 through §215.37. the project.
OMB Circulars and Guidance §215.34
(2) The recipient may be directed to (b) Exempt property. When statutory
sell the property under guidelines pro- authority exists, the Federal awarding
vided by the Federal awarding agency agency has the option to vest title to
and pay the Federal Government for property acquired with Federal funds
that percentage of the current fair in the recipient without further obliga-
market value of the property attrib- tion to the Federal Government and
utable to the Federal participation in under conditions the Federal awarding
the project (after deducting actual and agency considers appropriate. Such
reasonable selling and fix-up expenses, property is "exempt property." Should
if any, from the sales proceeds). When a Federal awarding agency not estab-
the recipient is authorized or required lish conditions, title to exempt prop-
to sell the property, proper sales proce- erty upon acquisition shall vest in the
dures shall be established that provide recipient without further obligation to
for competition to the extent prat- the Federal Government.
ticable and result in the highest pos- §215.34 Equipment.
sible return.
(3) The recipient may be directed to (a) Title to equipment acquired by a
transfer title to the property to the recipient with Federal funds shall vest
Federal Government or to an eligible in the recipient, subject to conditions
third party provided that, in such of this section.
cases, the recipient shall be entitled to (b) The recipient shall not use equip-
compensation for its attributable per- ment acquired with Federal funds to
centage of the current fair market provide services to non-Federal outside
value of the property. organizations for a fee that is less than
private companies charge for equiva-
§215.33 Federally-owned and exempt lent services, unless specifically au-
property. thorized by Federal statute, for as long
(a) Federally-owned property. (1) Title as the Federal Government retains an
interest in the equipment.
to federally-owned property remains
vested in the Federal Government. Re- (c) The recipient shall use the equip-
cipients shall submit annually an in- ment in the project or program for
which it was acquired as long as need-
ventory listing of federally-owned ed, whether or not the project or pro-
property in their custody to the Fed-
eralFed-
awarding agency. Upon completion gram continues to be supported by of the award or when the property is no eral funds and shall not encumber the
property without approval of the Fed-
longer needed, the recipient shall re-
eral awarding agency. When no longer
port the property to the Federal award- needed for the original project or pro-
ing agency for further Federal agency gram, the recipient shall use the equip-
utilization. ment in connection with its other fed-
(2) If the Federal awarding agency erally-sponsored activities. in the fol-
has no further need for the property, it lowing order of priority:
shall be declared excess and reported to (1) Activities sponsored by the Fed-
the General Services Administration, eral awarding agency which funded the
unless the Federal awarding agency original project, then
has statutory authority to dispose of (2) Activities sponsored by other Fed-
the property by alternative methods eral awarding agencies.
(e.g., the authority provided by the (d) During the time that equipment
Federal Technology Transfer Act (15 is used on the project or program for
U.S.C. 3710 (I)) to donate research which it was acquired, the recipient
equipment to educational and non-prof- shall make it available for use on other
it organizations in accordance with projects or programs if such other use
E.O. 12821, "Improving Mathematics will not interfere with the work on the
and Science Education in Support of project or program for which the equip-
the National Education Goals" (57 FR ment was originally acquired. First
54285, 3 CFR, 1992 Comp., p. 323)). Ap- preference for such other use shall be
propriate instructions shall be issued given to other projects or programs
to the recipient by the Federal award- sponsored by the Federal awarding
ing agency. agency that financed the equipment;
93
§215.34 2 CFR Ch. II (1-1-12 Edition)
second preference shall be given to ferences between quantities deter-
projects or programs sponsored by mined by the physical inspection and
other Federal awarding agencies. If the those shown in the accounting records
equipment is owned by the Federal shall be investigated to determine the
Government, use on other activities causes of the difference. The recipient
not sponsored by the Federal Govern- shall, in connection with the inven-
ment shall be permissible if authorized tory, verify the existence, current uti-
by the Federal awarding agency. User lization, and continued need for the
charges shall be treated as program in- equipment.
come. (4) A control system shall be in effect
(e) When acquiring replacement to insure adequate safeguards to pre-
equipment, the recipient may use the vent loss, damage, or theft of the
equipment to be replaced as trade-in or equipment. Any loss, damage, or theft
sell the equipment and use the pro- of equipment shall be investigated and
ceeds to offset the costs of the replace- fully documented; if the equipment was
ment equipment subject to the ap- owned by the Federal Government, the
proval of the Federal awarding agency. recipient shall promptly notify the
(f) The recipient's property manage- Federal awarding agency.
ment standards for equipment acquired (5) Adequate maintenance procedures
with Federal funds and federally-owned shall be implemented to keep the
lowinment shall include all of the fol- equipment in good condition.
(1) Equipment records shall be main- (6) Where the recipient is authorized
tained accurately and shall include the or required to sell the equipment, prop-
following information, er sales procedures shall be established
(i)A description of the equipment. which provide for competition to the
(ii) Manufacturer's serial number, extent practicable and result in the
model number, Federal stock number, highest possible return.
national stock number, or other identi- (g) When the recipient no longer
fication number. needs the equipment, the equipment
(iii) Source of the equipment, includ- may be used for other activities in ac-
ing the award number. cordance with the following standards.
(iv) Whether title vests in the recipi- For equipment with a current per unit
ent or the Federal Government. fair market value of $5000 or more, the
(v) Acquisition date (or date re- recipient may retain the equipment for
ceived, if the equipment was furnished other uses provided that compensation
by the Federal Government) and cost. is made to the original Federal award-
(vi) Information from which one can ing agency or its successor. The
calculate the percentage of Federal amount of compensation shall be corn-
participation in the cost of the equip- puted by applying the percentage of
ment (not applicable to equipment fur- Federal participation in the cost of the
nished by the Federal Government). original project or program to the cur-
(vii) Location and condition of the rent fair market value of the equip-
equipment and the date the informa- ment. If the recipient has no need for
tion was reported. the equipment, the recipient shall re-
(viii) Unit acquisition cost. quest disposition instructions from the
(ix) Ultimate disposition data, in- Federal awarding agency. The Federal
eluding date of disposal and sales price awarding agency shall determine
or the method used to determine cur- whether the equipment can be used to
rent fair market value where a recipi- meet the agency's requirements. If no
ent compensates the Federal awarding requirement exists within that agency,
agency for its share. the availability of the equipment shall
(2) Equipment owned by the Federal be reported to the General Services Ad-
Government shall be identified to indi- ministration by the Federal awarding
cate Federal ownership. agency to determine whether a require-
(3) A physical inventory of equipment ment for the equipment exists in other
shall be taken and the results rec- Federal agencies. The Federal award-
onciled with the equipment records at ing agency shall issue instructions to
least once every two years. Any dif- the recipient no later than 120 calendar
OMB Circulars and Guidance §215.36
days after the recipient's request and the equipment shall be subject to the
the following procedures shall govern. provisions for federally-owned equip-
(1) If so instructed or if disposition ment.
instructions are not issued within 120
calendar days after the recipient's re- §215.35 Supplies and other expend-
quest, the recipient shall sell the able property.
equipment and reimburse the Federal (a) Title to supplies and other ex-
awarding agency an amount computed pendable property shall vest in the re-
by applying to the sales proceeds the cipient upon acquisition. If there is a
percentage of Federal participation in residual inventory of unused supplies
the cost of the original project or pro- .exceeding $5000 in total aggregate
gram. However, the recipient shall be value upon termination or completion
permitted to deduct and retain from of the project or program and the sup-
the Federal share $500 or ten percent of plies are not needed for any other fed-
the proceeds, whichever is less, for the orally-sponsored project or program,
recipients selling and handling ex- the recipient shall retain the supplies
penses. for use on non-Federal sponsored ac-
(2) If the recipient is instructed to
ship the equipment elsewhere, the re- tivities or sell them, but shall, in ei-
cipient shall be reimbursed by the Fed- ther case, compensate the Federal Gov-
eral Government by an amount which ernment for its share. The amount of
is computed by applying the percent- compensation shall be computed in the
age of the recipient's participation in same manner as for equipment.
the cost of the original project or pro- (b) The recipient shall not use sup-
gram to the current fair market value plies acquired with Federal funds to
of the equipment, plus any reasonable provide services to non-Federal outside
shipping or interim storage costs in- organizations for a fee that is less than
curred. private companies charge for equiva-
(3) If the recipient is instructed to lent services, unless specifically au-
otherwise dispose of the equipment, the thorized by Federal statute as long as
recipient shall be reimbursed by the the Federal Government retains an in-
Federal awarding agency for such costs terest in the supplies.
incurred in its disposition.
(4) The Federal awarding agency may §215.36 Intangible property.
reserve the right to transfer the title (a) The recipient may copyright any
to the Federal Government or to a work that is subject to copyright and
third party named by the Federal Gov- was developed, or for which ownership
ernment when such third party is oth- was purchased, under an award. The
erwise eligible under existing statutes. Federal_awarding agency(ies) reserve a
Such transfer shall be subject to the royalty-free, nonexclusive and irrev-
following standards. ocable right to reproduce, publish, or
(i) The equipment shall be appro- otherwise use the work for Federal pur-
priately identified in the award or oth- poses, and to authorize others to do so.
erwrttin seise made known to the recipient in (b) Recipients are subject to applica-
(ilg ble regulations governing patents and
l The Federal awarding agency inventions, including government-wide
shall issue disposition instructions
within 120 calendar days after receipt regulations issued by the Department
of a final inventory. The final inven- of Commerce at 37 CFR part 401,
tory shall list all equipment acquired "Rights to Inventions Made by Non-
with grant funds and federally-owned profit Organizations and Small Busi-
equipment. If the Federal awarding ness Firms Under Government Grants,
agency fails to issue disposition in- Contracts and Cooperative Agree-
structions within the 120 calendar day meats."
period, the recipient shall apply the (c) The Federal Government has the
standards of this section, as appro- right to:
priate. (1) Obtain, reproduce, publish or oth-
(iii) When the Federal awarding erwise use the data first produced
agency exercises its right to take title, under an award.
95
§215.37 2 CFR Ch. II (1-1-12 Edition)
(2) Authorize others to receive, repro- (B) A Federal agency publicly and of-
duce, publish, or otherwise use such ficially cites the research findings in
data for Federal purposes. support of an agency action that has
(d) (1) In addition, in response to a the force and effect of law.
Freedom of Information Act (FOIA) re- (iii) Used by the Federal Government
quest for research data relating to pub- in developing an agency action that
lished research findings produced under has the force and effect of law is de-
an award that was used by the Federal fined as when an agency publicly and
Government in developing an agency officially cites the research findings in
action that has the force and effect of support of an agency action that has
law, the Federal awarding agency shall the force and effect of law.
request, and the recipient shall pro- (e) Title to intangible property and
vide, within a reasonable time, the re- debt instruments acquired under an
search data so that they can be made award or subaward vests upon acquisi-
available to the public through the pro- tion in the recipient. The recipient
cedures established under the FOIA. If shall use that property for the origi-
the Federal awarding agency obtains pally-authorized purpose, and the re-
the research data solely in response to cipient shall not encumber the prop-
a FOIA request, the agency may charge erty
without approval of the Federal
the requester a reasonable fee equaling
the full incremental cost of obtaining awarding agency. When no longer need-
the research data. This fee should re- ed for the originally authorized pur-
flect costs incurred by the agency, the pose, disposition of the intangible prop-
recipient, and the applicable subrecipi- erty shall occur in accordance with the
ents. This fee is in addition to any fees provisions of§215.34(g).
the agency may assess under the FOIA [69 FR 26281, May 11, 2004, as amended at 70
(5 U.S.C. 552(a)(4)(A)). FR 51881, Aug.31,2005]
(2) The following definitions apply
for purposes of paragraph (d) of this §215.37 Property trust relationship.
section:
(I) Research data is defined as the re- Real property, equipment, intangible
corded factual material commonly ac- property and debt instruments that are
cepted in the scientific community as acquired or improved with Federal
necessary to validate research findings, funds shall be held in trust by the re-
but not any of the following: Prelimi- cipient as trustee for the beneficiaries
nary analyses, drafts of scientific pa- of the project or program under which
pers, plans for future research, peer re the property was acquired or improved,
views, or communications with col- Agencies may require recipients to
leagues. This "recorded" material ex- record liens or other appropriate no
eludes physical objects (e.g., laboratory tices of record to indicate that per-
samples). Research data also do not in- sonal or real property has been ac
clude: quired or improved with Federal funds
(A) Trade secrets, commercial infor- and that use and disposition conditions
mation, materials necessary to be held apply to the property.
confidential by a researcher until they PROCUREMENT STANDARDS
are published, or similar information
which is protected antler law; and §215.40 Purpose of procurement
(B) Personnel and medical informa- standards.
tion and similar information the dis-
closure of which would constitute a Sections 215.41 through 215.48 set
clearly unwarranted invasion of per- forth standards for use by recipients in
sonal privacy, such as information that establishing procedures for the pro-
could be used to identify a particular curement of supplies and other expend-
person in a research study. able property, equipment, real property
(ii) Published is defined as either and other services with Federal funds.
when: These standards are furnished to en-
(A) Research findings are published sure that such materials and services
in a peer-reviewed scientific or tech- are obtained in an effective manner
nical journal; or and in compliance with the provisions
96
OMB Circulars and Guidance §215.44
of applicable Federal statutes and ex- §215.43 Competition.
ecutive orders. No additional procure- All procurement transactions shall
ment standards or requirements shall be conducted in a manner to provide,
be imposed by the Federal awarding to the maximum extent practical, open
agencies upon recipients, unless spe- and free competition. The recipient
cifically required by Federal statute or shall be alert to organizational con-
executive order or approved by OMB. flicts of interest as well as noncompeti-
§215.41 Recipient responsibilities. tive practices among contractors that
The standards contained in this sec- may restrict or eliminate competition
lion do not relieve the recipient of the or otherwise restrain trade. In order to
ensure objective contractor perform-
contractual responsibilities arising ance and eliminate unfair competitive
under its contract(s). The recipient is advantage, contractors that develop or
the responsible authority, without re- draft specifications, requirements,
course to the Federal awarding agency, statements of work, invitations for
regarding the settlement and satisfac- bids and/or requests for proposals shall
tion of all contractual and administra- be excluded from competing for such
tive issues arising out of procurements procurements. Awards shall be made to
entered into in support of an award or the bidder or offeror whose bid or offer
other agreement. This includes dis- is responsive to the solicitation and is
pates, claims, protests of award, source most advantageous to the recipient,
evaluation or other matters of a con- price, quality and other factors consid-
tractual nature. Matters concerning ered. Solicitations shall clearly set
violation of statute are to be referred forth all requirements that the bidder
to such Federal, State or local author- or offeror shall fulfill in order for the
ity as may have proper jurisdiction. bid or offer to be evaluated by the re-
§215.42 Codes of conduct. cipient. Any and all bids or offers may
be rejected when it is in the recipient's
The recipient shall maintain written interest to do so.
standards of conduct governing the
performance of its employees engaged §215.44 Procurement procedures.
in the award and administration of (a) All recipients shall establish writ-
contracts. No employee, officer, or ten procurement procedures. These
agent shall participate in the selection, procedures shall provide for, at a min-
award, or administration of a contract imam, that paragraphs (a)(1), (2) and
supported by Federal funds if a real or (3) of this section apply.
apparent conflict of interest would be (1) Recipients avoid purchasing un-
involved. Such a conflict would arise necessary items.
when the employee, officer, or agent, (2) Where appropriate, an analysis is
any member of his or her immediate made of lease and purchase alter-
family, his or her partner, or an orga- natives to determine which would be
nization which employs or is about to the most economical and practical pro-
employ any of the parties indicated curement for the Federal Government.
herein, has a financial or other interest (3) Solicitations for goods and serv-
in the firm selected for an award. The ices provide for all of the following.
officers, employees, and agents of the (i) A clear and accurate description
recipient shall neither solicit nor ac- of the technical requirements for the
cept gratuities, favors, or anything of material, product or service to be pro-
monetary value from contractors, or cured. In competitive procurements,
parties to subagreements. However, re- such a description shall not contain
cipients may set standards for situa- features which unduly restrict corn-
tions in which the financial interest is petition.
not substantial or the gift is an unso- (ii) Requirements which the bidder/
licited item of nominal value. The offeror must fulfill and all other fac-
standards of conduct shall provide for tors to be used in evaluating bids or
disciplinary actions to be applied for proposals.
violations of such standards by offi- (iii) A description, whenever prac-
cers, employees, or agents of the re- ticable, of technical requirements in
cipient. terms of functions to be performed or
97
§215.45 2 CFR Ch. II (1-1-12 Edition)
performance required, including the propriate for the particular procure-
range of acceptable characteristics or ment and for promoting the best inter-
minimum acceptable standards. est of the program or project involved.
(iv) The specific features of "brand The "cost-plus-a-percentage-of-cost"
name or equal" descriptions that bid- or "percentage of construction cost"
ders are required to meet when such methods of contracting shall not be
items are included in the solicitation. used.
(v) The acceptance, to the extent (d) Contracts shall be made only with
practicable and economically feasible, responsible contractors who possess
of products and services dimensioned in the potential ability to perform suc-
the metric system of measurement. cessfully under the terms and condi-
(vi) Preference, to the extent prac- tions of the proposed procurement.
ticable and economically feasible, for Consideration shall be given to such
products and services that conserve matters as contractor integrity, record
natural resources and protect the envi- of past performance, financial and
ronment and are energy efficient, technical resources or accessibility to
(b) Positive efforts shall be made by other necessary resources. In certain
recipients to utilize small businesses, circumstances, contracts with certain
minority-owned firms, and women's parties are restricted by agencies' im-
business enterprises, whenever pos- plementation of E.O.s 12549 and 12689,
sible. Recipients of Federal awards "Debarment and Suspension."
shall take all of the following steps to (e) Recipients shall, on request, make
further this goal. available for the Federal awarding
(1) Ensure that small businesses, mi- agency, pre-award review and procure-
nority-owned firms, and women's buss- ment documents, such as request for
ness enterprises are used to the fullest proposals or invitations for bids, inde-
extent practicable. pendent cost estimates, etc., when any
(2) Make information on forthcoming of the following conditions apply,
opportunities available and arrange (1) A recipient's procurement proce-
time frames for purchases and con- dures or operation fails to comply with
tracts to encourage and facilitate par- the procurement standards in the Fed-
ticipation by small businesses, minor- eral awarding agency's implementation
ity-owned firms, and women's business of this part.
enterprises. (2) The procurement is expected to
(3) Consider in the contract process exceed the small purchase threshold
whether firms competing for larger fixed at 41 U.S.C. 403 (11) (currently
contracts intend to subcontract with $25,000) and is to be awarded without
small businesses, minority-owned
firms, and women's business enter- competition or only one bid or offer is
prises. received in response to a solicitation.
(4) Encourage contracting with con- (3) The procurement, which is ex-
sortiums of small businesses, minority- thresh to exceed the small purchase
owned firms and women's business en threshold, specifies a "brand name"
terprises when a contract is too large product.
for one of these firms to handle individ- (4) The proposed award over the
ually, small purchase threshold is to be
(5) Use the services and assistance, as awarded to other than the apparent
procure-
appropriate, of such organizations as low bidder under a sealed bid
the Small Business Administration and ment.
the Department of Commerce's Minor (5) A proposed contract modification
ity Business Development Agency in changes the scope of a contract or in-
the solicitation and utilization of creases the contract amount by more
small businesses, minority-owned firms than the amount of the small purchase
and women's business enterprises. threshold.
(c)The type of procuring instruments §215.45 Cost and price analysis.
used(e.g., fixed price contracts, cost re-
imbursable contracts, purchase orders, Some form of cost or price analysis
and incentive contracts) shall be deter- shall be made and documented in the
mined by the recipient but shall be ap- procurement files in connection with
OMB Circulars and Guidance §215.48
every procurement action. Price anal- conditions where the contract may be
ysis may be accomplished in various terminated because of circumstances
ways, including the comparison of beyond the control of the contractor.
price quotations submitted, market (c) Except as otherwise required by
prices and similar indicia, together statute, an award that requires the
with discounts. Cost analysis is the re- contracting (or subcontracting) for
view and evaluation of each element of construction or facility improvements
cost to determine reasonableness, shall provide for the recipient to follow
allocability and allowability. its own requirements relating to bid
215.46 Procurement records. guarantees, performance bonds, and
payment bonds unless the construction
Procurement records and files for contract or subcontract exceeds
purchases in excess of the small pur- $100,000. For those contracts or sub-
chase threshold shall include the fol- contracts exceeding $100,000, the Fed-
lowing at a minimum: eral awarding agency may accept the
(a)Basis for contractor selection; bonding policy and requirements of the
(b) Justification for lack of competi- recipient, provided the Federal award-
tion when competitive bids or offers ing agency has made a determination
are not obtained; and that the Federal Government's interest
(c)Basis for award cost or price. is adequately protected. If such a§ de-
termination has not been made, the
215.47 Contract administration.
minimum requirements shall be as fol-
A system for contract administration lows.
shall be maintained to ensure con- (1) A bid guarantee from each bidder
tractor conformance with the terms, equivalent to five percent of the bid
conditions and specifications of the price. The "bid guarantee" shall con-
contract and to ensure adequate and sist of a firm commitment such as a
timely follow up of all purchases. Re- bid bond, certified check, or other ne-
cipients shall evaluate contractor per- gotiable instrument accompanying a
formance and document, as appro- bid as assurance that the bidder shall,
priate, whether contractors have met upon acceptance of his bid, execute
the terms, conditions and specifica- such contractual documents as may be
tions of the contract, required within the time specified.
A
bond on the part of
§215.48 Contract provisions. the)contractorance for 100 percent of the
The recipient shall include, in addi- contract price. A "performance bond"
tion to provisions to define a sound and is one executed in connection with a
complete agreement, the following pro= contract to secure fulfillment of all the
visions in all contracts. The following contractor's obligations under such
provisions shall also be applied to sub- contract.
contracts. (3) A payment bond on the part of the
(a) Contracts in excess of the small contractor for 100 percent of the con-
purchase threshold shall contain con- tract price. A "payment bond" is one
tractual provisions or conditions that executed in connection with a contract
allow for administrative, contractual, to assure payment as required by stat-
or legal remedies in instances in which ute of all persons supplying labor and
a contractor violates or breaches the material in. the execution of the work
contract terms, and provide for such provided for in the contract.
remedial actions as may be appro- (4) Where bonds are required in the
priate. situations described herein, the bonds
(b) All contracts in. excess of the shall be obtained from companies hold-
small purchase threshold shall contain ing certificates of authority as accept-
suitable provisions for termination by able sureties pursuant to 31 CFR part
the recipient, including the manner by 223, "Surety Companies Doing Business
which termination shall be effected with the United States."
and the basis for settlement. In addi- (d) All negotiated contracts (except
tion, such contracts shall describe con- those for less than the small purchase
ditions under which the contract may threshold) awarded by recipients shall
be terminated for default as well as include a provision to the effect that
99
§215.50 2 CFR Ch. II (1-1-12 Edition)
the recipient, the Federal awarding (d) When required, performance re-
agency, the Comptroller General of the ports shall generally contain, for each
United States, or any of their duly au- award, brief information on each of the
thorized representatives, shall have ac- following.
cess to any books, documents, papers (1) A comparison of actual accom-
and records of the contractor which are plishments with the goals and objec-
directly pertinent to a specific pro- tives established for the period, the
gram for the purpose of making audits, findings of the investigator, or both.
examinations, excerpts and tran- Whenever appropriate and the output
scriptions. of programs or projects can be readily
(e) All contracts, including small quantified, such quantitative data
purchases, awarded by recipients and should be related to cost data for com-
their contractors shall contain the pro- putation of unit costs.
curement provisions of appendix A to (2) Reasons why established goals
this part, as applicable, were not met, if appropriate.
(3) Other pertinent information in-
REPORTS AND RECORDS eluding, when appropriate, analysis
and explanation of cost overruns or
§215.50 Purpose of reports and high unit costs.
records. (e)Recipients shall not be required to
Sections 215.51 through 215.53 set submit more than the original and two
forth the procedures for monitoring copies of performance reports.
and reporting on the recipient's finan (f) Recipients shall immediately no-
cial and program performance and the trfy the Federal awarding agency of de-
necessary standard reporting forms. velopments that have a significant im-
They also set forth record retention re pact on the award-supported activities.
quirements. Also, notification shall be given in the
case of problems, delays, or adverse
§215.51 Monitoring and reporting pro- conditions which materially impair the
gram performance, ability to meet the objectives of the
(a) Recipients are responsible for award. This notification shall include a
con-
managing and. monitoring each project, statement of the action taken or templated, and any assistance needed
program, subaward, function or activ- to resolve the situation.
ity supported by the award. Recipients (g) Federal awarding agencies may
shall monitor subawards to ensure sub- make site visits, as needed.
recipients have met the audit require- (h) Federal awarding agencies shall
ments,as delineated in§215.26. comply with clearance requirements of
(b) The Federal awarding agency 5 CFR part 1320 when requesting per-
shall prescribe the frequency with formance data from recipients.
which the performance reports shall be
submitted. Except as provided in §215.52 Financial reporting.
§215.51(f), performance reports shall (a) The following forms or such other
not be required more frequently than forms as may be approved by OMB are
quarterly or, less frequently than an- authorized for obtaining financial in-
nually. Annual reports shall be due 90 formation from recipients.
calendar days after the grant year; (1) SF-269 or SF-269A, Financial Sta-
quarterly or semi-annual reports shall tus Report.
be due 30 days after the reporting pe- (i) Each Federal awarding agency
riod. The Federal awarding agency may shall require recipients to use the SF-
require annual reports before the anni- 269 or SF-269A to report the status of
versary dates of multiple year awards funds for all nonconstruction projects
in lieu of these requirements. The final or programs. A Federal awarding agen-
performance reports are due 90 cal- cy may, however, have the option of
endar days after the expiration or ter- not requiring the SF-269 or SF-269A
mination of the award. when the SF-270, Request for Advance
(c) If inappropriate, a final technical or Reimbursement, or SF-272, Report
or performance report shall not be re- of Federal Cash Transactions, is deter-
quired after completion of the project. mined to provide adequate information
IOC
OMB Circulars and Guidance §215.52
to meet its needs, except that a final days. Recipients shall provide short
SF-269 or SF-269A shall be required at narrative explanations of actions taken
the completion of the project when the to reduce the excess balances.
SF-270 is used only for advances. (iv) Recipients shall be required to
(ii) The Federal awarding agency submit not more than the original and
shall prescribe whether the report shall two copies of the SF-272 15 calendar
be on a cash or accrual basis. If the days following the end of each quarter.
Federal awarding agency requires ac- The Federal awarding agencies may re-
crual information and the recipient's quire a monthly report from those re-
accounting records are not normally cipients receiving advances totaling $1
kept on the accrual basis, the recipient million or more per year.
shall not be required to convert its ac- (v) Federal awarding agencies may
counting system, but shall develop waive the requirement for submission
such accrual information through best of the SF-272 for any one of the fol-
estimates based on an analysis of the lowing reasons:
documentation on hand. (A) When monthly advances do not
(iii) The Federal awarding agency exceed $25,000 per recipient, provided
shall determine the frequency of the that such advances are monitored
Financial Status Report for each through other forms contained in this
project or program, considering the section;
size and complexity of the particular (B) If, in the Federal awarding agen-
project or program. However, the re- cy's opinion, the recipient's accounting
port shall not be required more fre-
quently than quarterly or less fre- controls are adequate to minimize ex-
quently than annually. A final report cessive Federal advances; or,
shall be required at the completion of (C) When the electronic payment
the agreement. mechanisms provide adequate data.
(iv) The Federal awarding agency (b) When the Federal awarding agen-
shall require recipients to submit the cy needs additional information or
SF-269 or SF-269A (an original and no more frequent reports, the following
more than two copies) no later than 30 shall be observed.
days after the end of each specified re- (1) When additional information is
porting period for quarterly and semi- needed to comply with legislative re-
annual reports, and 90 calendar days quirements, Federal awarding agencies
for annual and final reports. Exten- shall issue instructions to require re-
sions of reporting due dates may be ap- cipients to submit such information
proved by the Federal awarding agency under the "Remarks" section of the re-
upon request of the recipient. ports.
(2) SF-272, Report of Federal Cash; (2) When a Federal awarding agency
Transactions. determines that a recipient's account-
(i) When funds are advanced to De- ing system does not meet the standards
cipients the Federal awarding agency in §215.21, additional pertinent infor-
shall require each recipient to submit mation to further monitor awards may
the SF-272 and, when necessary, its be obtained upon written notice to the
continuation sheet, SF-272a. The Fed- recipient until such time as the system
eral awarding agency shall use this re- is brought up to standard. The Federal
port to monitor cash advanced to re- awarding agency, in obtaining this in-
cipients and to obtain disbursement in- formation, shall comply with report
formation for each agreement with the clearance requirements of 5 CFR part
recipients. 1320.
(ii) Federal awarding agencies may (3) Federal awarding agencies are en-
require forecasts of Federal cash re- couraged to shade out any line item on
quirements in the "Remarks" section any report if not necessary.
of the report. (4) Federal awarding agencies may
(iii) When practical and deemed nec- accept the identical information from
essary, Federal awarding agencies may the recipients in machine readable for-
require recipients to report in the mat or computer printouts_ or elec-
"Remarks" section the amount of cash tronic outputs in lieu of prescribed for-
advances received in excess of three mats.
101
§215.53 2 CFR Ch. II (1-1-12 Edition)
(5) Federal awarding agencies may (e) The Federal awarding agency, the
provide computer or electronic outputs Inspector General, Comptroller Gen-
to recipients when such expedites or eral of the United States, or any of
contributes to the accuracy of report- their duly authorized representatives.
ing, have the right of timely and unre-
stricted access to any books, docu-
§215.53 Retention and access require- ments, papers, or other records of re-
ments for records. cipients that are pertinent to the
(a) This section sets forth require- awards, in order to make audits, ex-
ments for record retention and access aminations, excerpts, transcripts and
to records for awards to recipients. copies of such documents. This right
Federal awarding agencies shall not also includes timely and reasonable ac-
impose any other record retention or cess to a recipient's personnel for the
access requirements upon recipients. purpose of interview and discussion re-
(b) Financial records, supporting doe- lated to such documents. The rights of
uments, statistical records, and all access in this paragraph are not lim-
other records pertinent to an award ited to the required retention period,
shall be retained for a period of three but shall last as long as records are re-
years from the date of submission of tamed.
the final expenditure report or, for (f) Unless required by statute, no
awards that are renewed quarterly or Federal awarding agency shall place
annually, from the date of the submis- restrictions on recipients that limit
sion of the quarterly or annual finan- public access to the records of recipi-
cial report, as authorized by the Fed- ents that are pertinent to an award, ex-
eral awarding agency. The only excep- cept when the Federal awarding agency
tions are the following. can demonstrate that such records
(1) If any litigation, claim, or audit is shall be kept confidential and would
started before the expiration of the 3- have been exempted from disclosure
year period, the records shall be re- pursuant to the Freedom of Informa-
tained until all litigation, claims or tion Act (5 U.S.C. 552) if the records
audit findings involving the records had belonged to the Federal awarding
have been resolved and final action agency.
taken. (g) Indirect cost rate proposals, cost al-
(2) Records for real property and locations plans, etc. Paragraphs (g)(1)
equipment acquired with Federal funds and (g)(2) of this section apply to the
shall be retained for 3 years after final following types of documents, and their
disposition. supporting records: indirect cost rate
(3) When records are transferred to or computations or proposals, cost alloca-
maintained by the Federal awarding tion plans, and any similar accounting
agency, the 3-year retention require- computations of the rate at which a
ment is not applicable to the recipient. particular group of costs is chargeable
(4) Indirect cost rate proposals, cost (such as computer usage chargeback
allocations plans, etc, as specified in rates or composite fringe benefit
§215.53(g). rates).
(c) Copies of original records may be (1) If submitted for negotiation. If the
substituted for the original records if recipient submits to the Federal
authorized by the Federal awarding awarding agency or the subrecipient
agency. submits to the recipient the proposal,
(d) The Federal awarding agency plan, or other computation to form the
shall request transfer of certain basis for negotiation of the rate, then
records to its custody from recipients the 3-year retention period for its sup-
when it determines that the records porting records starts on the date of
possess long term retention value. such submission.
However, in order to avoid duplicate (2) If not submitted for negotiation. If
recordkeeping, a Federal awarding the recipient is not required to submit
agency may make arrangements for re- to the Federal awarding agency or the
cipients to retain any records that are subrecipient is not required to submit
continuously needed for joint use to the recipient the proposal, plan, or
102
OMB Circulars and Guidance §215.62
other computation for negotiation pur- the terms and conditions of an award,
poses, then the 3-year retention period whether stated in a Federal statute,
for the proposal, plan, or other com- regulation, assurance, application, or
putation and its supporting records notice of award, the Federal awarding
starts at the end of the fiscal year (or agency may, in addition to imposing
other accounting period) covered by any of the special conditions outlined
the proposal, plan, or other computa- in §215.14, take one or more of the fol-
tion. lowing actions, as appropriate in the
circumstances.
TERMINATION AND ENFORCFMFNT (1) Temporarily withhold cash pay-
ments pending correction of the defi-
enforcement. ciency by the recipient or more severe
enforcement action by the Federal
Sections 215.61 and 215.62 set forth awarding agency.
uniform suspension, termination and (2) Disallow (that is, deny both use of
enforcement procedures. funds and any applicable matching
§215.61 Termination. credit for) all or part of the cost of the
activity or action not in compliance.
(a) Awards may be terminated in (3) Wholly or partly suspend or ter-
whole or in part only if paragraphs minate the current award.
(a)(1), (2) or (3) of this section apply. (4) Withhold further awards for the
(1) By the Federal awarding agency, project or program.
if a recipient materially fails to corn- (5) Take other remedies that may be
ply with the terms and conditions of an legally available.
award. (b) Hearings and appeals. In taking an
(2) By the Federal awarding agency enforcement action, the awarding
with the consent of the recipient, in agency shall provide the recipient an
which case the two parties shall agree opportunity for hearing, appeal, or
upon the termination conditions, in- other administrative proceeding to
eluding the effective date and, in the which the recipient is entitled under
case of partial termination, the portion any statute or regulation applicable to
to be terminated. the action involved.
(3) By the recipient upon sending to (c) Effects of suspension and termi-
the Federal awarding agency written nation. Costs of a recipient resulting
notification setting forth the reasons from obligations incurred by the re-
for such termination, the effective cipient during a suspension or after
date, and, in the case of partial termi- termination of an award are not allow-
nation, the portion to be terminated. able unless the awarding agency ex-
However, if the Federal awarding agen- pressly authorizes them in the notice
cy determines in the case of partial of suspension or termination or subse-
termination that the reduced or modi- quently. Other recipient costs during
fled portion of the grant will not ac- suspension or after termination which
complish the purposes for which the are necessary and not reasonably
grant was made, it may terminate the avoidable are allowable if paragraphs
grant in its entirety under either para- (c)(1) and (2) of this section apply.
graphs (a)(1) or(2) of this section. (1) The costs result from obligations
(b) If costs are allowed under an which were properly incurred by the re-
award, the responsibilities of the re- cipient before the effective date of sus-
cipient referred to in §215.71(a), includ- pension or termination, are not in an-
ing those for property management as ticipation of it, and in the case of a ter-
applicable, shall be considered in the mination, are noncancellable.
termination of the award, and provi- (2) The costs would be allowable if
sion shall be made for continuing re- the award were not suspended or ex-
sponsibilities of the recipient after ter- pired normally at the end of the fund-
mination, as appropriate. ing period in which the termination
§ takes effect.
215.62 Enforcement.
(d) Relationship to debarment and sus-
(a) Remedies for noncompliance. If a re- pension. The enforcement remedies
cipient materially fails to comply with identified in this section, including
103
§215.70 2 CFR Ch. I1 (1-1-12 Edition)
suspension and termination, do not an award, the Federal awarding agency
preclude a recipient from being subject shall retain the right to recover an ap-
to debarment and suspension under propriate amount after fully consid-
E.O.s 12549 and 12689 and the Federal ering the recommendations on dis-
awarding agency implementing regula- allowed costs resulting from the final
tions (see §215.13). audit.
Subpart D—After-the-Award §215.72 Subsequent adjustments and
Requirements continuing responsibilities.
(a) The closeout of an award does not
§215.70 Purpose. affect any of the following:
Sections 215.71 through 215.73 contain (1) The right of the Federal awarding
closeout procedures and other proce- agency to disallow costs and recover
dures for subsequent disallowances and funds on the basis of a later audit or
adjustments. other review.
(2) The obligation of the recipient to
§215.71 Closeout procedures. return any funds due as a result of
(a) Recipients shall submit, within 90 later refunds, corrections, or other
calendar days after the date of comple- transactions.
Lion of the award, all financial, per- (3)Audit requirements in §215.26.
forrnance, and other reports as required Property management require
by the terms and conditions of the ments in§§215.31 through 215.37.
award. The Federal awarding agency (5) Records retention as required in
may approve extensions when re- §215.53.
quested by the recipient. (b) After closeout of an award, a rely
(b) Unless the Federal awarding agen- tionship created under an award may
be modified or ended in whole or in
cy authorizes an extension, a recipient
shall liquidate all obligations incurred part with the consent of the Federal
under the award not later than 90 cal- awarding agency and the recipient,
endar days after the funding period or provided the responsibilities of the re-
the date of completion as specified in cipient referred to in paragraph (a) of
the terms and conditions of the award this section, including those for prop-
or in agency implementing instruc- erty management as applicable, are
tions. considered and provisions made for
(c) The Federal awarding agency continuing responsibilities of the re-
shall make prompt payments to a re-
cipient for allowable reimbursable [69 FR 26281, May 11, 2004, as amended at 70
costs under the award being closed out. FR 51881,Aug. 31,2005]
(d) The recipient shall promptly re-
fund any balances of unobligated cash §215.73 Collection of amounts due.
that the Federal awarding agency has (a) Any funds paid to a recipient in
advanced or paid and that is not au- excess of the amount to which the re-
thorized to be retained by the recipient cipient is finally determined to be enti-
for use in other projects. OMB Circular tled under the terms and conditions of
A-129 governs unreturned amounts that the award constitute a debt to the Fed-
become delinquent debts. eral Government. If not paid within a
(e)When authorized by the terms and reasonable period after the demand for
conditions of the award, the Federal payment, the Federal awarding agency
awarding agency shall make a settle- may reduce the debt by paragraphs
ment for any upward or downward ad- (a)(1), (2) or (3) of this section.
justments to the Federal share of costs (1) Making an administrative offset
after closeout reports are received. against other requests for reimburse-
(f) The recipient shall account for ments.
any real and personal property ac- (2) Withholding advance payments
quired with Federal funds or received otherwise due to the recipient.
from the Federal Government in ac- (3) Taking other action permitted by
cordance with §215.31 through §215.37. statute.
(g) In the event a final audit has not (b) Except as otherwise provided by
been performed prior to the closeout of law, the Federal awarding agency shall
104
OMB Circulars and Guidance Pt. 215, App. A
charge interest on an overdue debt in port all suspected or reported violations (4
accordance with 4 CFR Chapter II, the Federal awarding agency.
"Federal Claims Collection Stand- 4. Contract Work Hours and Safety Standards
ards." Act (40 U.S.C. 327-333)—Where applicable, all
contracts awarded by recipients in excess of
A TO PART 215—CONTRACT $2000 for construction contracts and in ex-
APPENDIXcess of$2500 for other contracts that involve
PROVISIONS the employment of mechanics or laborers
shall include a provision for compliance with
All contracts, awarded by a recipient in- sections 102 and 107 of the Contract Work
cluding small purchases, shall contain the Hours and Safety Standards Act (40 U.S,C.
following provisions as applicable: 327-333), as supplemented by Department of
1. Equal•Employment Opportunity—All con- Labor regulations (29 CFR part 5). Under sec-
tracts shall contain a provision requiring tion 102 of the Act, each contractor shall be
compliance with E.O. 11246, "Equal Employ- required to compute the wages of every me-
ment Opportunity" (30 FR 12319, 12935, 3 chanic and laborer on the basis of a standard
CFR, 1964-1965 Comp., p. 339), as amended by work week of 40 hours. Work in excess of the
E.O. 11375, "Amending Executive Order 11246 standard work week is permissible provided
Relating to Equal Employment Oppor- that the worker is compensated at a rate of
tunity," and as supplemented by regulations not less than 11 times the basic rate of pay
at 41 CFR part 60, "Office of Federal Con- for all hours worked in excess of 40 hours in
tract Compliance Programs, Equal Employ- the work week. Section 107 of the Act is ap-
merit Opportunity,Department of Labor." plicable to construction work and provides
2. Copeland "Anti-Kickback" Act (18 U.S.C, that no laborer or mechanic shall be required
874 and 40 U.S.C. 276c)All contracts and sub- to work in surroundings or under working
grants in excess of$2000 for construction or conditions which are unsanitary, hazardous
repair awarded by recipients and subrecipi- or dangerous. These requirements do not
ents shall include a provision for compliance apply to the purchases of supplies or mate-
with the Copeland "Anti-Kickback" Act (18 riais or articles ordinarily available on the
U.S.C. 874), as supplemented by Department open market, or contracts for transportation.
of Labor regulations (29.CFR part 3, "Con- or transmission of intelligence,
tractors and Subcontractors on Public Build 5. Rights to Inventions Made Under a Con-
ing or Public Work Financed in Whole or in tract or Agreement—Contracts or agreements
Part byP Loans or Grants the or in for the performance of experimental, devel-
Paates"). The Actr provides fromtha each Ucnited
opmental, or research work shall provide for
tractor or subrecipient shall be prohibited tthe rghts of the Federal Government and
from inducing, by any means, any person ce accordancerecipient in 37 any CFRre part
4g invention io
employed in the construction, completion, or Invntionswith by part 401, "Rights tos
repair ofpublic work, to Inventions Made Nonprofit Organizations
p give up any part of and Small Business Firms Under Govern-
the compensation to which he is otherwise ment Grants, Contracts and Cooperative
entitled. The recipient shall report all sus- Agreements," and any implementing regula-
pected or reported violations to the Federal tions issued by the awarding agency,
awarding agency. 6. Clean Air Act (42 U.S.C. 7401 et seq.) and
3. Davis-Bacon Act, as amended (40 U.S.C. the Federal Water Pollution Control Act (33
276a to a-7)—When required by Federal pro- U.S.C. 1251 et seq.), as amended—Contracts
• gram legislation, all construction contracts and subgrants of amounts in excess of
awarded by the recipients and subrecipients $100,000 shall contain a provision that re-
of more than $2000 shall include a provision quires the recipient to agree to comply with
for compliance with the Davis-Bacon Act (40 all applicable standards, orders or regula-
U.S.C. 276a to a-7) and as supplemented by tions issued pursuant to the Clean Air Act
Department of Labor regulations (29 CFR (42 U.S.C. 7401 et seq.) and the Federal Water
part 5, "Labor Standards Provisions Applica- Pollution Control Act as amended (33 U.S.C.
ble to Contracts Governing Federally Fi- 1251 et seq.). Violations shall be reported to
nanced and Assisted Construction"). Under the Federal awarding agency and the Re-
this Act, contractors shall be required to pay gional Office of the Environmental Protec-
wages to laborers and mechanics at a rate tion Agency(EPA).
not less than the minimum wages specified 7. Byrd Anti-Lobbying Amendment (31 U.S.C.
in a wage determination made by the Sec- 1352)—Contractors who apply or bid for an
retary of Labor. In addition, contractors award of $100,000 or more shall file the re-
shall be required to pay wages not less than quired certification. Each tier certifies to
once a week. The recipient shall place a copy the tier above that it will not and has not
of the current prevailing wage determination used Federal appropriated funds to pay any
issued by the Department of Labor in each person or organization for influencing or at-
solicitation and the award of a contract shall tempting to influence an officer or employee
be conditioned upon the acceptance of the of any agency, a member of Congress, officer
;vase determination. The recipient shall re- or employee of Congress, or an employee of a
105
Pt. 220 2 CFR Ch. II (1-1-12 Edition)
member of Congress in connection with ob- §220.10 Scope.
taming any Federal contract, grant or any
other award covered by 31 U.S.C. 1352. Each The principles in this part deal with
tier shall also disclose any lobbying with the subject of cost determination, and
non-Federal funds that takes .place in con- make no attempt to identify the cir-
nection with obtaining any Federal award. cumstances or dictate the extent of
Such disclosures are forwarded from tier to agency and institutional participation
tier up to the recipient. in the financing of a particular project.
8. Debarment and Suspension (E.O.s 12549 Provision for profit or other increment
and 12689)—A contract award with an above cost is outside the scope of this
amount expected to equal or exceed $25,000 part.
and certain other contract awards(see 2 CFR
180.220) shall not be made to parties listed on §220.15 Policy.
the government-wide Excluded Parties List
System, in accordance with the OMB guide- The principles in this part are de-
lines at 2 CFR part 180 that implement E.O.s signed to provide that the Federal Gov-
12549 (3 CFR, 1986 Comp., p. 189) and 12689 (3 ernment bear its fair share of total
CFR, 1989 Comp., p. 235). "Debarment and costs, determined in accordance with
Suspension." The Excluded Parties List Sys- generally accepted accounting prin-
tern contains the names of parties debarred, ciples, except where restricted or pro-
suspended, or otherwise excluded by agen- hibited by law. Agencies are not ex-
cies, as well as parties declared ineligible petted to place additional restrictions
under statutory or regulatory authority on individual items of cost. The sac-
other than E.O. 12549.
cessful application of cost accounting
[69 FR 26281, May 11, 2004, as amended at 70 principles requires development of mu-
FR 51879. Aug. 31,2005] tual understanding between represent-
atives of educational institutions and
PARTS 216-219 [RESERVED] of the Federal Government as to their
scope, implementation, and interpreta-
PART 220—COST PRINCIPLES FOR tion.
EDUCATIONAL INSTITUTIONS §220.20 Applicability.
(OMB CIRCULAR A-21)
(a) All Federal agencies that sponsor
research and development, training,
Sec. and other work at educational institu-
220.5 Purpose. tions shall apply the provisions of Ap-
220.10 Scope. pendix A to this part in determining
220.15 Policy. the costs incurred for such work. The
220.20 Applicability, principles shall also be used as a guide
220.25 OMB responsibilities, in the pricing of fixed
220.30 Federal agency responsibilities. p g price or lump
220.35 Effective date of changes. sum agreements.
220.40 Relationship to previous issuance. (b) Each federal agency that awards
220.95 Information contact, defense-related contracts to a Feder-
ally Funded Research and Development
APPENDIX A TO PART 220—PRINCIPLES FOR DE- Center (FFRDC) associated with an
TERMINING COSTS APPLICABLE TO GRANTS, educational institution shall require
CONTRACTS, AND OTHER AGREEMENTS WITH the FFRDC to comply with the Cost
EDUCATIONAL INSTITUTIONS
Accounting Standards and with the
AUTHORITY: 31 U.S.C. 503: 31 U.S.C. 1111; 41 rules and regulations issued by the
U.S.C. 405; Reorganization Plan No. 2 of 1970; Cost Accounting Standards Board and
E.O. 11541, 35 FR 10737, 3 CFR, 1966-1970, p• set forth in 47 CFR part 99.
939.
SOURCE: 70 FR 51881, Aug. 31, 2005, unless §220.25 OMB responsibilities.
otherwise noted. OMB is responsible for:
§220.5 Purpose. (a) Issuing and maintaining the guid-
ance in this part.
This part establishes principles for (b) Interpreting the policy require-
determining costs applicable to grants, ments in this part and providing assist-
contracts, and other agreements with ance to ensure effective and efficient
educational institutions. implementation.
106
EXHIBIT C
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EXHIBIT D
DEFINITION OF PROGRAM INCOME
"Program income" means gross income received by the Recipient or a Subrecipient directly generated from the uses of
CDBG/HOME/NSP and other federal funds. When such income is generated by an activity that is only partially assisted
with CDBG/HOME/NSP and other federal funds, the income shall be prorated to reflect the percentage of
CDBG/HOME/NSP and other federal 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/HOME/NSP and other federal funds;
(ii) Proceeds from the disposition of equipment purchased with CDBG/HOME/NSP and other federal funds;
(iii) Gross income from the use or rental of real or personal property acquired by the Recipient or a
Subrecipient with CDBG/HOME/NSP and other federal 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/HOME/NSP and other federal funds, less the costs incidental to the
generation of such income;
(v) Payments of principal and interest on loans made using CDBG/HOME/NSP and other federal funds;
(vi) Proceeds from the sale of loans made with CDBG/HOME/NSP and other federal funds;
(vii) Proceeds from the sale of obligations secured by loans made with CDBG/HOME/NSP and other federal
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/HOME/NSP and other federal 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/HOME/NSP and
other federal assistance; funds collected through special assessments used to recover the non-CDBG/HOME/NSP
and other federal portion of a public improvement; and proceeds from the disposition of real property acquired or
improved with CDBG/HOME/NSP and other federal 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 for CDBG program funds and §92.503 for HOME/NSP program funds.
(3) Any program income generated by NSP funds through March 31, 2013 shall be used to construct housing units
east of 72nd Street affordable to low-, moderate-, and middle-income (LMMI)households. After March 31,2013,
all program income generated by NSP funds will be limited to eligible CDBG activities, including the benefit to
low- and moderate-income (LMI) (not LMMI) households during the term of this Agreement, the program
income shall be returned to the City within thirty(30)days.
A
go,y,AaRTAR Revised and approved 12/3/2009
CITY OF OMAHA EXHIBIT F
AFFIRMATIVE MARKETING POLICY
AND MONITORING PROCEDURES
Effective: October 1, 1999
Revised: April 1,2015
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 community media serving
minority groups 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 in accordance with
provisions of the Uniform Relocation Act;
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 and on all application and documents/forms.
■ 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.
1 Reviewed and revised 4/1/2015
• Owners shall adopt a fair housing policy.
2. Informing low- and moderate-income persons about available units
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 Center, 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
2401 Lake Street 4001 Leavenworth Street
Omaha,NE 68111 Omaha,NE 68105
Eastern Nebraska Human Services Heartland Family Service
900 South 74th Plaza, Suite 200 2101 South 42nd Street
Omaha,NE 68114 Omaha,NE 68105
Greater Omaha Community Action Heartland Family Service
2406 Fowler Avenue 6720 North 30th Street
Omaha,NE 68111 Omaha,NE 68112
Greater Omaha Community Action Heartland Family Service
5002 South 24th Street, Suite 203 2580 South 90th Street
Omaha,NE 68111 Omaha,NE 68124
League of Human Dignity Heartland Family Service
5513 Center Street 11212 Davenport Street
Omaha,NE 68106 Omaha,NE 68154
Heartland Family Service Nebraska Commission for the Deaf
116 E. Mission Avenue 1313 Farnam on the Mall
Bellevue,NE 68005 Omaha,NE 68102
Heartland Family Service Omaha Association for the Blind
302 American Parkway 1024 South 32nd Street
Papillion,NE 68046 Omaha,NE 68105
Holy Name Housing Corporation Great Plains Chapter
3014 North 45th Street Paralyzed Veterans of America
Omaha,NE 68104 7612 Maple Street
Omaha,NE 68134
Mayor's Commission for Citizens
with Disabilities
1819 Farnam Street, Room 304
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
2 Reviewed and revised 4/1/2015
• 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
• U.S. Citizenship Attestation Form for Public Benefit
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.
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 Form for Applicants, attached as Exhibit 1,
which includes the name, racial/ethnic characteristics, income and family size for each person
responding to the advertisement.
e) Prior to the start of the project, the Owner shall meet with each in-place tenants of the occupied
units and complete a Tenant Survey, utility allowance, City of Omaha Definition of Income
Affidavit, computing annual income form, and U.S. Citizenship Attestation for Public Benefit
form. Owner shall submit these properly completed forms to the City, as well as a copy of the
dated and signed lease agreement, and retain the original lease for proper record keeping. Forms
must be updated on lease anniversary date and submitted to the City during the period of
affordability. A copy of each form is attached and marked Exhibit 2.
f) 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.
3 Reviewed and revised 4/1/2015
g) After completion of the project, the Owner shall submit a Tenant Survey Form, utility allowance,
Computing Annual Income Form, U.S. Attestation of Citizenship for Public Benefit, and other
reporting forms as required by the terms of the Agreement, for each occupied unit, as well as a
copy of the lease agreement. All documents must be properly executed and dated.
h) 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
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 writing of any violations 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.
4 Reviewed and revised 4/1/2015
EXHIBIT 1
CITY OF OMAHA
DEMOGRAPHICS FORM FOR APPLICANTS
Loan No. Date No. of Vacant Units
Owner Project Address
Person Completing Person's Phone No.
This Report Home: Work
Race/Ethnicity
Family Monthly Of Head of
Applicant Size Income Household
NOTE: This form is a list of everyone who inquired about renting or purchasing the unit(s).
5 Reviewed and revised 4/1/2015
AFFIRMATIVE MARKETING POLICY PLAN
The Undersigned does/do hereby agree to comply with all terms and conditions of and adopt the City of
Omaha's Affirmative Marketing Policy (attached hereto and incorporated herein by this reference as though
fully set forth) for the Project located at as approved by on
Date:
Name of Business or Corporation:
(if applicable)
By:
Signature
Printed Name:
6 Reviewed and revised 4/1/2015
EXHIBIT G
Pt. 230 2 CFR Ch. II (1-1-12 Edition)
3. Indirect cost allocations not using rates. §230.5 Purpose.
In certain situations, a governmental unit,
because of the nature of its awards, may be This part establishes principles for
required to develop a cost allocation plan determining costs of grants, contracts
that distributes indirect (and, in some cases, and other agreements with non-profit
direct) costs to the specific funding sources. organizations.
In these cases, a narrative cost allocation
methodology should be developed, docu- §230,10 Scope.
mented, maintained for audit, or submitted,
as appropriate, to the cognizant agency for (a) This part does not apply to col-
review,negotiation,and approval, leges and universities which are cov-
4. Appeals. If a dispute arises in a negotia- ered by 2 CFR part 220 Cost Principles
tion of an indirect cost rate (or other rate) for Educational Institutions (OMB Cir-
between the cognizant agency and the gov- ruler A-21); State, local, and federally-
ernmental unit, the dispute shall be resolved recognized Indian tribal governments
in accordance with the appeals procedures of which are covered by 2 CFR part 225
the cognizant agency. Cost Principles for State, Local, and
5. Collection of unallowable costs and erro- Indian Tribal Governments (OMB Cir-
neous payments. Costs specifically identified
as unallowable and charged to Federal cular A-87); or hospitals.
awards either directly or indirectly will be (b) The principles deal with the sub-
refunded (including interest chargeable in ject of cost determination, and make
accordance with applicable Federal agency no attempt to identify the cir-
regulations). cumstances or dictate the extent of
6. OMB assistance.To the extent that prob- agency and non-profit organization
lems are encountered among the Federal participation in the financing of a par-
agencies and/or governmental units in con- titular project. Provision for profit or
nection with the negotiation and approval other increment above cost is outside
process, OMB will lend assistance, as re-
quired, to resolve such problems in a timely the scope of this part.
manner_
§230.15 Policy.
PARTS 226-229 [RESERVED] The principles are designed to pro-
vide that the Federal Government bear
PART 230-COST PRINCIPLES FOR its fair share of costs except where re-
NON-PROFIT ORGANIZATIONS stricted or prohibited by law. The prin-
ciples do not attempt to prescribe the
extent of cost sharing or matching on
grants, contracts, or other agreements.
Sec. However, such cost sharing or match-
230.5 Purpose. ing shall not be accomplished through
230.10 Scope. arbitrary limitations on individual
230.15 Policy. cost elements by Federal agencies.
230.20 Applicability.
230.25 Definitions *230.20 Applicability.
230.30 OMB responsibilities.
230.35 Federal agency responsibilities. (a) These principles shall be used by
230.40 Effective date of changes. all Federal agencies in determining the
230.45 Relationship to previous issuance_ costs of work performed by non-profit
230.50 Information Contact. organizations under grants, coopers,
APPENDIX A vo PART 29D—OENEltAL Pars- tive agreements, cost reimbursement
CIPLES contracts, and other contracts in which
APPENDIX B TO PART 230—SET:RIOTED ITEMS OF costs are used in pricing, administra-
COST tion, or settlement. All of these instru-
APPENDIX C TO PART 230—NON-PROFIT ORGA- ments are hereafter referred to as
NIZATIONS NOT SUBJECT TO THIS PART awards. The principles do not apply to
AUTHORITY: 31 U.S.C. 503; 31 U.S.C. 1111; 41 awards under which an organization is
U.S.C.405; Reorganization Plan No. 2 of 1970; not required to account to the Federal
E.O.11541,35 FR 10737,3 CFR, 1966-1970, p. 939 Government for actual costs incurred.
SOURCE: 70 FR 51927, Aug. 31, 2005, unless (b) All cost reimbursement sub-
otherwise noted_ awards (subgrants, subcontracts, etc.)
182
OMB Circulars and Guidance §230.50
are suhlec•i, to those Federal coot prim- §230.30 OMB responsibilities.
ciples applicable to the p,axtioular or- OMB may grant exceptions to the re-
genii tioan oonoernedk. Thos.. if a quirements of this part when permis-
sFutiaward is to a na ippi'cr€rt ar6aniza1 sible under existing law. However, in
elan this part shall appl-: if a the interest of achieving maximum
:ubaw +.rd is to a oorntuercial Qrga.ni a - uniformity, exceptions will be per-
time, the east principles applicable to mitted only in highly unusual cir-
commercial concerns shall apply; if a cumstances.
subavWtard is to a ooll0ge or university, �nsibiy=
2 CFR part 220 shall soiply; if a §230.35 Federal agency re
sunaward i to a State, local, or feder- ities.
ally-recognized Indian tribal govern- The head of Saab Federal agency that
merit,2 CFR part 227.1 shall apply. awards and administers grantil aild
Se9 )u p1ut ion of some nonepraiit or- agreeinents subject to this part is re-
ga .izaVian;_ Some non-proft organiza- eponsible for re0,u•:atiug approval from
'bione, beaus Of their siz and nature anrij'or consulting with OMB i:as appli=
of operations, can be oonsider d to be cable) for tieviax.tions from the guidance
sirni1ai to coa1zmed oiai coneef'ns for in the a.p pendiices to this part and per-
purpose of applicability of cost prin- forming thdp aPPlit.oble functions s ci-
eiples_ Such nop=prorit orgatl.zatioil's fled in the appendices to this part.
shall operate. under Federal cost prin-
ciples applicable to commercial ocn- §230.40 Effective date of changes.
:.erns. A listing of these organiZatiOns The provisions of this part are effee-
is contained in appendix C to this pelt. tive August 31, 2005. Implementation
Other organizations may be added From shall. be pleased.in lay incorporating the
time to time. provisions into new awards Made after
the start of the organization's next fie-
§230.25 Definitions. earl year, For existing awards. the ffiew
(a) Non-profit organization means principles may be. applied if an on" `
any corporation, trust, association, co- s atiotl and tie cognizant Federal en
operative, or other organization which: cy agree. Earlier implementation, or a
(1) Is operated primarily for sci- delay in plement t�tt iidual
entific, educational, service, chari- provisions. is alto 'pe
table, or similar purposes in the public agreerrient
tre between
t organagenization
interest; and
(2) Is not organized primarily for rm: previous
hip
profit; and §230.45 Relationsissuance.
(3) Uses its net proceeds to maintain,
improve, and/or expand its operations. t Theguidance in this pars pre
-
For this purpose, the term "non-profit viously was issued as OSIB. Cir ula,r A-
organization" excludes colleges and i?,2, .ppethdix A to this part contains
orsivet'sitlO ; hospitals.: State, local, the gul.lanoi that was in Attachment A
and federa.11Y.ree:ogutzed Inman tribal (general prineipics) to the OMB ciz-
ge ernments: and tho;c nou-profit, or- miler; Appenrle ; B. e•on1JLi a the iiId-
atrce? that viah nit Awtarlameut � tee-
coverage
gantzations which are k•xcludeal. from looteed items of cost) to the it Et t; e-
th2fl' this part in accordance cula:r; anal Appendix ( contains the in-
+xrith g 0 2Ck(c}_ formation that was in ttae.hmcnt C
ib t Pt�tor' app�rc�aak means securing the lno�p,�ofit, organizations not sui,leo.::t to
ance awarding agency's permission th tv in a€1- the Circular)to the' c_3113 circular,
vGmc;e to incur cost for those items
(-a,:� �'filsLQri�ca.F1�~, OMB Circular A-la's
tpat are designated as uirz requiring priorsuperseded cost principle.: .issued by in-
diCe�aval �i the part and its dividla-al:agencies for non-profit o; :i-
die:es. Generally this permission will be zations.
i n writing Where an item of cost ar+:-
qui quiring prior approval is specified in §230.50 Information contact.
the budget of an award, approval of the
bu
dget ooaFs%x'tartes approval of that part may be obtained by rther information ocontacting the
cost.
183
Pt. 230, App. A 2 CFR Ch. II (1-1-12 Edition)
Office of Federal Financial Manage- costs. The question of the reasonableness of
ment, OMB, Washington, DC 20503, specific costs must be scrutinized with par-
telephone (202) 395-3993. titular care in connection with organizations
or separate divisions thereof which receive
APPENDIX A TO PART 230—GENERAL the preponderance of their support from
PRINCIPLES awards made by Federal agencies. In deter-
mining the reasonableness of a given cost,
GENERAL PRINCIPLES consideration shall be given to:
• a. Whether the cost is of a type generally
TABLE OF CONTENTS recognized as ordinary and necessary for the
A. Basic Considerations operation of the organization or the perform-
1.Composition of total costs once of the award.
2.Factors affecting allowability of costs b. The restraints or requirements imposed
3.Reasonable costs by such factors as generally accepted sound
4.Allocable costs business practices, arms length bargaining,
5.Applicable credits Federal and State laws and regulations, and
6.Advance understandings terms and conditions of the award.
7. Conditional exemptions c. Whether the individuals concerned acted
B. Direct Costs with prudence in the circumstances, consid-
C. Indirect Costs ering their responsibilities to the organiza-
D. Allocation of Indirect Costs and Deter- tion, its members, employees, and clients,
mination of Indirect Cost Rates the public at large, and the Federal Govern-
1. General ment.
2. Simplified allocation method d. Significant deviations from the estab-
3.Multiple allocation base method lished practices of the organization which
4.Direct allocation method may unjustifiably increase the award costs.
5. Special indirect cost rates 4. Allocable costs. a. A cost is allocable to
E. Negotiation and Approval of Indirect Cost a particular cost objective, such as a grant,
Rates contract, project, service, or other activity,
1. Definitions in accordance with the relative benefits re-
2.Negotiation and approval of rates ceived. A cost is allocable to a Federal award
if it is treated consistently with other costs
GENERAL PRINCIPLES incurred for the same purpose in like cir-
cumstances and if it:
A.Basic Considerations
(1)Is incurred specifically for the award.
1. Composition of total costs. The total (2)Benefits both the award and other work
cost of an award is the sum of the allowable and can be distributed in reasonable propor-
direct and allocable indirect costs less any tion to the benefits received, or
applicable credits. (3) Is necessary to the overall operation of
2. Factors affecting allowability of costs. the organization, although a direct relation-
To be allowable under an award, costs must ship to any particular cost objective cannot
meet the following general criteria: be shown_,
a. Be reasonable for the performance of the b. Any cost allocable to a particular award
award and be allocable thereto under these or other cost objective under these principles
principles. may not be shifted to other Federal awards
b. Conform to any limitations or exclu- to overcome funding deficiencies, or to avoid
sions set forth in these principles or in the restrictions imposed by law or by the terms
award as to types or amount of cost items. of the award.
a. Be consistent with policies and prow- 5. Applicable credits. a. The term applica-
dures that apply uniformly to both federally- ble credits refers to those receipts, or reduc-
financed and other activities of the organiza- tion of expenditures which operate to offset
tion. or reduce expense items that are allocable to
d.Be accorded consistent treatment. awards as direct or indirect costs. Typical
e. Be determined in accordance with gen- examples of such transactions are: Purchase
erally accepted accounting principles discounts, rebates or allowances, recoveries
(GAAP). or indemnities on losses, insurance refunds,
f.Not be included as a cost or used to meet and adjustments of overpayments or erro-
cost sharing or matching requirements of neous charges. To the extent that such cred-
any other federally-financed program in ei- its accruing or received by the organization
ther the current or a prior period. relate to allowable cost, they shall be cred-
g.Be adequately documented. ited to the Federal Government either as a
3.Reasonable costs. A cost is reasonable if, cost reduction or cash refund, as appro-
in its nature or amount, it does not exceed priate.
that which would be incurred by a prudent b. In some instances, the amounts received
person under the circumstances prevailing at from the Federal Government to finance or-
the time the decision was made to incur the ganizational activities or service operations
184
OMB Circulars and Guidance Pt. 230, App. A
should be treated as applicable credits. Spe- own written fiscal and administrative re-
cifically, the concept of netting such credit quirements for expending and accounting for
items against related expenditures should be all funds, which are consistent with the pro-
applied by the organization in determining visions of 2 CFR part 225 (OMB Circular A-
the rates or amounts to be charged to Fed- 87), and extend such policies to all subrecipi-
eral awards for services rendered whenever ents. These fiscal and administrative re-
the facilities or other resources used in pro- quirements must be sufficiently specific to
viding such services have been financed di- ensure that: Funds are used in compliance
rectly, in whole or in part, by Federal funds. with all applicable Federal statutory and
c. For rules covering program income (i.e., regulatory provisions, costs are reasonable
gross income earned from federally-sup- and necessary for operating these programs,
ported activities) see §215.24 of 2 CFR part and funds are not to be used for general ex-
215 Uniform Administrative Requirements penses required to carry out other respon-
for Grants and Agreements with Institutions sibilities of a State or its subrecipiente.
of Higher Education, Hospitals, and Other
Non-Profit Organizations (OMB Circular A- B. Direct Costs
110) 1. Direct costs are those that can be identi-
6. Advance understandings. Under any fled specifically with a particular final cost
given award, the reasonableness and objective, i.e., a particular award, project,
allocability of certain items of costs may be service, or other direct activity of an organi-
difficult to determine. This is particularly zation. However, a cost may not be assigned
true in connection with organizations that to an award as a direct cost if any other cost
receive a preponderance of their support
from Federal agencies. In order to avoid sub- incurred for the same purpose, in like cir-
sequent disallowance or dispute based on cumstance, has been allocated to an award
unreasonableness or nonallocability, it is as an indirect cost. Costs identified specifi-
often desirable to seek a written agreement cally with awards are direct costs of the
with the cognizant or awarding agency in ad- awards and are to be assigned directly there-
vance of the incurrence of special or unusual to. Costs identified specifically with other
costs. The absence of an advance agreement final cost objectives of the organization are
on any element of cost will not, in itself, af- direct costs of those cost objectives and are
feet the reasonableness or allocability of not to be assigned to other awards directly
that element. or indirectly.
7. Conditional exemptions. a. OMB author- 2. Any direct cost of a minor amount may
izes conditional exemption from OMB admin- be treated as an indirect cost for reasons of
istrative requirements and cost principles practicality where the accounting treatment
for certain Federal programs with state- for such cost is consistently applied to all
torily-authorized consolidated planning and final cost objectives.
consolidated administrative funding, that 3. The cost of certain activities are not al-
are identified by a Federal agency and ap- lowable as charges to Federal awards (see,
proved by the head of the Executive depart- for example, fundraising costs in paragraph
ment or establishment. A Federal agency 17 of Appendix B to this part). However, even
shall consult with OMB during its consider- though these costs are unallowable for pur-
ation of whether to grant such an exemption. poses of computing charges to Federal
b. To promote efficiency in State and local awards, they nonetheless must be treated as
program administration, when Federal non- direct costs for purposes of determining indi-
entitlement programs with common pur- rect cost rates and be allocated their share
poses have specific statutorily-authorized of the organization's indirect costs if they
consolidated planning and consolidated ad- represent activities which include the sala-
ministrative funding and where most of the ries of,personnel, occupy space, and benefit
State agency's resources come from non- from the organization's indirect costs.
Federal sources, Federal agencies may ex- 4. The costs of activities performed pri-
empt these covered State-administered, non- marily as a service to members, clients, or
entitlement grant programs from certain the general public when significant and nec-
OMB grants management requirements. The essary to the organization's mission must be
exemptions would be from all but the treated as direct costs whether or not allow-
allocability of costs provisions of Appendix able and be allocated an equitable share of
A, subsection C.e. of 2 CFR part 225 (OMB indirect costs. Some examples of these types
Circular A-87); Appendix A. Section C.4. of 2 of activities include:
CFR part 220 (OMB Circular A-21); Section a. Maintenance of membership rolls, sub-
A.4. of this appendix; and from all of the ad- scriptions, publications, and related func-
ministrative requirements provisions of 2 tions,
CFR part 215 (OMB Circular A-110) and the b. Providing services and information to
agencies'grants management common rule. members, legislative or administrative bod-
e. When a Federal agency provides this ies, or the public.
flexibility, as a prerequisite to a State's ex- c. Promotion, lobbying, and other forms of
ercising this option, a State must adopt its public relations.
15
Pt. 230, App. A 2 CFR Ch. II (1-1-12 Edition)
d. Meetings and conferences except those putation of an indirect cost rate may be ac-
held to conduct the general administration complished through simplified allocation
of the organization. procedures, as described in subparagraph D.2
e. Maintenance, protection, and invest- of this appendix.
ment of special funds not used in operation b.Where an organization has several major
of the organization. functions which benefit from its indirect
f. Administration of group benefits on be- costs in varying degrees, allocation of indi-
half of members or clients, including life and rect costs may require the accumulation of
hospital insurance, annuity or retirement such costs into separate cost groupings
plans,financial aid,etc. which then are allocated individually to ben-
efiting functions by means of a base which
C.Indirect Costs best measures the relative degree of benefit.
1. Indirect costs are those that have been The indirect costs allocated to each function
incurred for common or joint objectives and are then distributed to individual awards and
cannot be readily identified with a par- other activities included in that function by
titular final cost objective, Direct cost of means of an
de indirect cost rates}.
minor amounts may be treated as indirect C. The determination of what constitutes
s
costs under the conditions described in sub- an organics pup major functions will de-
paragraph B.2 of this appendix. After direct Pend on
es its purpose in being; the types of
costs have been determined and assigned di- services it renders to the public, its clients,
rectly to awards or other work as appro- and its members; and the amount of effort it
priate, indirect costs are those remaining to devotes to such activities as fundraising,
be allocated to benefiting cost objectives. A public information and membership activi-
cost may not be allocated to an award as an ties.
indirect cost if any other cost incurred for cd. Specific methods for allocating indirect
the same purpose, in like circumstances, has alongos and .computing indirect costc rates
been assigned to an award as a direct cost. method with the bco used arens under which each
in sub-
2. Because of the diverse characteristics should be h described appendix.
and accounting practices of non-profit orga- paragraphs The base D pteriod r
5 theo this tionoin-
nizations, it is not possible to specify the e. The period period allocation such c sts
types of cost which may be classified as indi- directarein costs is andtde ccu in which costs
rest cost in all situations. However, typical to work perd accumulated for allocation
Tbae
examples of indirect cost for many non-prof- periodo normally
shoulded in coincidet period. The base
or-
it organizations may include depreciation or ganiz no 's fi fiscalyear with the event,
use allowances on buildings and equipment, be so a as but, in any n
the costs of operating and maintaining fa- shall to a on oft selected as stto avoid inequities in
the allocation of the costs.
cilities, and general administration and gen- 2. Simplified allocation method. a. Where
eral expenses, such as the salaries and ex- an organization's major functions benefit
penses of executive officers, personnel ad- from its indirect costs to approximately the.
ministration,and accounting. same degree, the allocation of indirect costs
3. Indirect costs shall be classified within may be accomplished by separating the orga-
two broad categories: "Facilities" and "Ad- nization's total costs for the base period as
ministration." "Facilities" is defined as de- either direct .or indirect, and dividing the
preciation and use allowances on buildings, total allowable indirect costs(net of applica-
equipment and capital improvement, inter- ble credits) by an equitable distribution
est on debt associated with certain buildings. base. The result of this process is an indirect
equipment and capital improvements, and cost rate which is used to distribute indirect
operations and maintenance expenses. "Ad- costs to individual awards. The rate should
ministration" is defined as general adminis- be expressed as the percentage which the
tration and general expenses such as the di- total amount of allowable indirect costs
rector's office, accounting, personnel,library bears to the base selected. This method
expenses and all other types of expenditures should also be used where an organization
not listed specifically under one of the sub- has only one major function encompassing a
categories of"Facilities" (including cross al- number of individual projects or activities,
locations from other pools, where applica- and may be used where the level of Federal
ble). See indirect cost rate reporting require- awards to an organization is relatively
ments in subparagraphs D.2.e and D.3.g of small.
this appendix. b. Both the direct costs and the indirect
D.Allocation of Indirect Costs and costs shall exclude capital expenditures and
Determination of Indirect Cost Rates unallowable costs. However, unallowable
costs which represent activities must be in-
1. General. a. Where a non-profit organize- eluded in the direct costs under the condi-
tion has only one major function, or where tions described in subparagraph B.3 of this
all its major functions benefit from its indi- appendix.
rect costs to approximately the same degree, c. The distribution base may be total di-
the allocation of indirect costs and the corn- rect costs (excluding capital expenditures
186
OMB Circulars and Guidance Pt. 230, App. A
and other distorting items, such as major that have been incurred for the administra-
subcontracts or subgrants), direct salaries tion. operation, maintenance, preservation,
and wages, or other base which results in an and protection of the organization's physical
equitable distribution. The distribution base plant. They include expenses normally in-
shall generally exclude participant support curred for such items as: Janitorial and util-
costs as defined in paragraph 32 of Appendix ity services; repairs and ordinary or normal
B. alterations of buildings, furniture and equip-
d. Except where a special rate(s) is re- ment; care of grounds; maintenance and op-
quired in accordance with subparagraph 5 of eration of buildings and other plant facill-
this appendix, the indirect cost rate devel- ties; security; earthquake and disaster pre-
oped under the above principles is applicable paredness; environmental safety; hazardous
to all awards at the organization. If a special waste disposal; property, liability and other
rate(s) is required, appropriate modifications insurance relating to property; space and
shall be made in order to develop the special capital leasing; facility planning and man-
rate(s). agement; and, central receiving. The oper-
e. For an organization that receives more ation and maintenance expenses category
than $10 million in Federal funding of direct shall also include its. allocable share of
costs in a fiscal year, a breakout of the indi- fringe benefit costs, depreciation and use al-
rect cost component into two broad cat- lowances, and interest costs.
egories, Facilities and Administration as de- (4) General administration and general ex-
fined in subparagraph C.3 of this appendix, is penses. (a) The expenses under this heading
required. The rate in each case shall be stat- are those that have been incurred for the
ed as the percentage which the amount of overall general executive and administrative
the particular indirect cost category (i.e., offices of the organization and other ex-
Facilities or Administration) is of the dis- penses of a general nature which do not re-
tribution base identified with that category. late solely to any major function of the orga-
3.Multiple allocation base method. nization. This category shall also include its
a. General. Where an organization's indi- allocable share of fringe benefit costs, oper-
rect costs benefit its major functions in ation and maintenance expense, depreciation
varying degrees, indirect costs shall be accu- and use allowances, and interest costs. Ex-
mulated into separate cost groupings, as de- amples of this category include central of-
scribed in subparagraph D.3.b of this appen- fives, such as the director's office, the office
dix. Each grouping shall then be allocated of finance, business services, budget and
individually to benefiting functions by planning, personnel, safety and risk manage-
means of a base which best measures the rel- ment, general counsel, management infor-
ative benefits, The default allocation bases mation systems, and library costs.
by cost pool are described in subparagraph (b) In developing this cost pool, special
D.3.c of this appendix. care should be exercised to ensure that costs
b. Identification of indirect costs. Cost incurred for the same purpose in like cir-
groupings shall be established so as to per- cumstances are treated consistently as ei-
mit the allocation of each grouping on the ther direct or indirect costs. For example,
basis of benefits provided to the major func- salaries of technical staff, project supplies,
tions. Each grouping shall constitute a pool project publication, telephone toll charges,
of expenses that are of like character in computer costs, travel costs, and specialized
terms of functions they benefit and in terms services costs shall be treated as direct costs
of the allocation base which best measures wherever identifiable to a particular pro-
the relative benefits provided to each func- gram. The salaries and wages of administra-
tion. The groupings are classified within the tive and pooled clerical staff should nor-
two broad categories: "Facilities" and "Ad- mally be treated as indirect costs. Direct
ministration," as described in subparagraph charging of these costs may be appropriate
C.3 of this appendix. The indirect cost pools where a major project or activity explicitly
are defined as follows: requires and budgets for administrative or
(1) Depreciation and use allowances. The clerical services and other individuals in-
expenses under this heading are the portion volved can be identified with the program or
of the costs of the organization's buildings, activity. Items such as office supplies, post-
capital improvements to land and buildings, age, local telephone costs, periodicals and
and equipment which are computed in ac- memberships should normally be treated as
cordance with paragraph 11 of Appendix B to indirect costs,
this part ("Depreciation and use allow- c.Allocation bases. Actual conditions shall
antes"). be taken into account in selecting the base
(2) Interest. Interest on debt associated to be used in allocating the expenses in each
with certain buildings, equipment and cap- grouping to benefiting functions. The essen-
ital improvements are computed in accord- . tial consideration In selecting a method or a
ance with paragraph 23 of Appendix B to this base is that it is the one best suited for as-
part("Interest"). signing the pool of costs to cost objectives in
(3) Operation and maintenance expenses. accordance with benefits derived; a traceable
The expenses under this heading are those cause and effect relationship; or logic and
187
Pt. 230, App. A 2 CFR Ch. 1I (1-1-12 Edition)
reason, where neither the cause nor the ef- allocated in the same manner as the depre-
feet of the relationship is determinable. elation and use allowances.
When an allocation can be made by assign- (4) General administration and general ex-
ment of a cost grouping directly to the func- penses. General administration and general
tion benefited, the allocation shall be made expenses shall be allocated to benefiting
in that manner. When the expenses in a cost functions based on modified total direct
grouping are more general in nature, the al- costs (MTDC), as described in subparagraph
location shall be made through the use of a D.3.f of this appendix. The expenses included
selected base which produces results that are in this category could be grouped first ac-
equitable to both the Federal Government cording to major functions of the organiza-
and the organization. The distribution shall tion to which they render services or provide
be made in accordance with the bases de- benefits. The aggregate expenses of each
scribed herein unless it can be demonstrated
that the use of a different base would result group shall then be allocated to benefiting
in a more equitable allocation of the costs, functions based on MTDC.
or that a more readily available base would d. Order of distribution. (1) Indirect cost
not increase the costs charged to sponsored categories consisting of depreciation and use
awards. The results of special cost studies allowances, interest, operation and mainte-
(such as an engineering utility study) shall nance, and general administration and gen-
not be used to determine and allocate the in- eral expenses shall be allocated in that order
direct costs to sponsored awards. to the remaining indirect cost categories as
(1)Depreciation and use allowances. Depre- well as to the major functions of the organi-
ciation and use allowances expenses shall be zation. Other cost categories could be allo-
allocated in the following manner: sated in the order determined to be most ap-
(a) Depreciation or use allowances on propriate by the organization. When cross al-
buildings used exclusively in the conduct of location of costs is made as provided in sub-
a single function, and on capital improve- paragraph D.3.d.(2) of this appendix, this
ments and equipment used in such buildings, order of allocation does not apply.
shall be assigned to that function. (2)Normally, an indirect cost category will
(b) Depreciation or use allowances on be considered closed once it has been allo-
buildings used for more than one function, cated to other cost objectives, and costs
and on capital improvements and equipment shall not be subsequently allocated to it.
used in such buildings, shall be allocated to However, a cross allocation of costs between
the individual functions performed in each two or more indirect costs categories could
building on the basis of usable square feet of be used if such allocation will result in a
space, excluding common areas, such as hall- more equitable allocation of costs. If a cross
ways,stairwells, and restrooms. allocation is used, an appropriate modifica-
(c) Depreciation or use allowances on tion to the composition of the indirect cost
buildings, capital improvements and equip- categories is required.
ment related space (e.g., individual rooms,
and laboratories) used jointly by more than e. Application of indirect cost rate or
one function (as determined by,the users of rates. Except where a special indirect cost
the space) shall be treated as follows. The rate(s) is required in accordance with sub-
cost of each jointly used unit of space shall paragraph D.5 of this appendix, the separate
be allocated to the benefiting functions on groupings of indirect costs allocated to each
the basis of either the employees and other major function shall be aggregated and
users on. a full-time equivalent (FTE) basis treated as a common pool for that function.
or salaries and wages of those individual The costs in the common pool shall then be
functions benefiting from the use of that distributed to individual awards included in
space; or organization-wide employee FTEs that function by use of a single indirect cost
or salaries and wages applicable to the bene- rate.
fiting functions of the organization. f.Distribution basis. Indirect costs shall be
(d) Depreciation or use allowances on cer- distributed to applicable sponsored awards
tarn capital improvements to land, such as and other benefiting activities within each
paved parking areas, fences, sidewalks, and major function on the basis of MTDC. MTDC
the like, not included in the cost of build- consists of all salaries and wages, fringe ben-
ings, shall be allocated to user categories on efits, materials and supplies,services, travel,
a FTE basis and distributed to major func- and subgrants and subcontracts up to the
tions in proportion to the salaries and wages first $25,000 of each subgrant or subcontract
of all employees applicable to the functions. (regardless of the period covered by the
(2) Interest. Interest costs shall be allo- subgrant or subcontract).Equipment, capital
cated in the same manner as the deprecia- expenditures, charges for patient care, rental
tion or use allowances on the buildings, costs and the portion in excess of $25,000
equipment and capital equipments to which shall be excluded from MTDC. Participant
the interest relates. support costs shall generally be excluded
(3) Operation and maintenance expenses. from MTDC. Other items may only be ex-
Operation and maintenance expenses shall be eluded when the Federal cost cognizant
1E8.
OMB Circulars and Guidance Pt. 230, App. A
agency determines that an exclusion is nee- resources employed, the scientific disciplines
essary to avoid a serious inequity in the dis- or technical skills involved, the organiza-
tribution of indirect costs. tional arrangements used, or any combine-
g. Individual Rate Components. An indi- tion thereof. When a particular segment of
rect cost rate shall be determined for each work is performed in an environment which
separate indirect cost pool developed. The appears to generate a significantly different
rate in each case shall be stated as the per- level of indirect costs, provisions should be
tentage which the amount of the particular made for a separate indirect cost pool appii-
indirect cost pool is of the distribution base cable to such work. The separate indirect
identified with that pool. Each indirect cost cost pool should be developed during the
rate negotiation or determination agreement course of the regular allocation process, and
shall include development of the rate for the separate indirect cost rate resulting
each indirect cost pool as well as the overall therefrom should be used, provided it is de-
indirect cost rate. The indirect cost pools termined that the rate differs significantly
shall be classified within two broad cat- from that which would have been obtained
egories: "Facilities" and "Administration," under subparagraphs D.2, 3, and 4 of this ap-
as described in subparagraph C.3 of this ap- pendix, and the volume of work to which the
pendix. rate would apply is material,
4. Direct allocation method. a. Some non-
profit organizations treat all costs as direct E.Negotiation and Approval of Indirect Cost
costs except general administration and gen- Rates
eral expenses. These organizations generally
separate their costs into three basic cat- 1. Definitions. As used in this section, the
egories: General administration and general following terms have the meanings set forth
expenses, fundraising, and other direct font- below:
tions (including projects performed under a. Cognizant agency means the Federal
Federal awards). Joint costs, such as depre- agency responsible for negotiating and ap-
ciation, rental costs, operation and mainte- proving indirect'cost rates for a non-profit
Hance of facilities, telephone expenses, and organization on behalf of all Federal agen-
the like are prorated individually as direct ties.
costs to each category and to each award or b. Predetermined rate means an indirect
other activity using a base most appropriate cost rate,applicable to a specified current or
to the particular cost being prorated. future period, usually the organization's fis-
b.This method is acceptable,provided each cal year. The rate is based on an estimate of
joint cost is prorated using a base which ac- the costs to be incurred during the period. A
curately measures the benefits provided to predetermined rate is not subject to adjust-
each award or other activity. The bases must ment.
be established in accordance with reasonable c. Fixed rate means an indirect cost rate
criteria, and be supported by current data, which has the same characteristics as a pre-
This method is compatible with the Stand- determined rate, except that the difference
ards of Accounting and Financial Reporting between the estimated costs and the actual
for Voluntary Health and Welfare Organize- costs of the period covered by the rate is car-
tions issued jointly by the National Health Tied forward as an adjustment to the rate
Council, Inc., the National Assembly of Vol- computation of a subsequent period.
untary Health and Social Welfare Organize- d. Final rate means an indirect cost rate
tions, and the United Way of America. applicable to a specified past period which is
c. Under this method, indirect costs con- based on the actual costs of the period. A
sist exclusively of general administration final rate is not subject to adjustment.
and general expenses. In all other respects, e. Provisional rate or billing rate means a
the organization's indirect cost rates shall temporary indirect cost rate applicable to a
be computed in the same manner as that de- specified period which is used for funding, in-
scribed in subparagraph D.2 of this appendix. terim reimbursement, and reporting indirect
5. Special indirect cost rates. In some in- costs on awards pending the establishment of
stances, a single indirect cost rate for all ac- a final rate for the period.
tivities of an organization or for each major f. Indirect cost proposal means the docu-
function of the organization may not be ap- mentation prepared by an organization to
propriate, since it would not take into ac- substantiate its claim for the reimbursement
count those different factors which may sub- of indirect costs. This proposal provides the
stantially affect the indirect costs applicable basis for the review and negotiation leading
to a particular segment of work. For this to the establishment of an organization's in-
purpose, a particular segment of work may direct cost rate.
be that performed under a single award or it g. Cost objective means a function, organi-
may consist of work under a group of awards zational subdivision, contract, grant. or
performed in a common environment. These other work unit for which cost data are de-
factors may include the physical location of sired and for which provision is made to ac-
the work, the level of administrative support cumulate and measure the cost of processes,
required, the nature of the facilities or other projects,jobs and capitalized projects.
189
Pt. 230, App. B 2 CFR Ch. II (1-1-12 Edition)
2. Negotiation and approval of rates. a. Un- dispute shall be resolved in accordance with
less different arrangements are agreed to by the appeals procedures of the cognizant
the agencies concerned, the Federal agency agency.
with the largest dollar value of awards with i. To the extent that problems are encoun-
an organization will be designated as the tered among the Federal agencies in connec-
cognizant agency for the negotiation and ap- tion with the negotiation and approval proc-
proval of the indirect cost rates and, where ess, OMB will lend assistance as required to
necessary, other rates such as fringe benefit resolve such problems in a timely manner.
and computer charge-out rates. Once an
agency is assigned cognizance for a par- APPENDIX B TO PART 230-SELECTED
titular non-profit organization, the assign- ITEMS OF COST
ment will not be changed unless there is a
major long-term shift in the dollar volume of SELECTED ITEMS OF COST
the Federal awards to the organization. All TABLE OF CONTENTS
concerned Federal agencies shall be given
the opportunity to participate in the nego- 1.Advertising and public relations costs
tiation process but, after a rate has been 2. Advisory councils
agreed upon, it will be accepted by all Fed- 3.Alcoholic beverages
eral agencies. When a Federal agency has 4. Audit posts and related services
reason to believe that special operating fat- 5.Bad debts
tors affecting its awards necessitate special 6. Bonding costs
indirect cost rates in accordance with sub- 7.Communication costs
paragraph D.5 of this appendix, it will, prior 8. Compensation for personal services
to the time the rates are negotiated, notify 9. Contingency provisions
the cognizant agency. 10. Defense and prosecution of criminal and
b. A non-profit organization which has not civil proceedings, claims, appeals and
previously established an indirect cost rate patent infringement
with a Federal agency shall submit its ini- 11. Depreciation and use allowances
tial indirect cost proposal immediately after 12. Donations and contributions
the organization- is advised that an award 13. Employee morale, health, and welfare
will be made and, in no event, later than costs
three months after the effective date of the 14. Entertainment costs
award. 15. Equipment and other capital expendi-
c. Organizations that have previously es- tures
tablished indirect cost rates must submit a 16. Fines and penalties
new indirect cost proposal to the cognizant 17. Fund raising and investment mn.anage-
agency within six months after the close of ment costs
each fiscal year. 18. Gains and losses on depreciable assets
d. A predetermined rate may be negotiated 19. Goods or services for personal use
for use on awards where there is reasonable 20. Housing and personal living expenses
assurance, based on past experience and reli- 21. Idle facilities and idle capacity
able projection of the organization's costs, 22. Insurance and indemnification
that the rate is not likely to exceed a rate 23. Interest
based on the organization's actual costs. 24. Labor relations costs
e. Fixed rates may be negotiated where 25. Lobbying
predetermined rates are not considered ap- 26. Losses on other sponsored agreements
propriate. A fixed rate, however, shall not be or contracts
negotiated if all or a substantial portion of 27.Maintenance and repair costs
the organization's awards are expected to ex- 28. Materials and supplies costs
spire before the carry-forward adjustment can 29. Meetings and conferences
be made; the mix of Federal and non-Federal 30. Memberships, subscriptions, and profes-
work at the organization is too erratic to sional activity costs
permit an equitable carry-forward adjust- 31. Organization costs
ment; or the organization's operations flue- 32.Page charges in professional journals
tuate significantly from year to year. 33.Participant support costs
f. Provisional and final rates shall be nego- 34. Patent costs
tiated where neither predetermined nor fixed 35. Plant and homeland security costs
rates are appropriate. 36. Pre-agreement costs
g. The results of each negotiation shall be 37. Professional services costs
formalized in a written agreement between 38.Publication and printing costs
the cognizant agency and the non-profit or- 39. Rearrangement and alteration costs
ganization. The cognizant agency shall dis- 40. Reconversion costs
tribute copies of the agreement to all con- 41.Recruiting costs
cerned Federal agencies. 42. Relocation costs
h. If a dispute arises in a negotiation of an 43.Rental costs of buildings and equipment
indirect cost rate between the cognizant 44. Royalties and other costs for use of pat-
agency and the non-profit organization, the ents and copyrights
190
OMB Circulars and Guidance Pt. 230, App. B
45. Selling and marketing are limited to communication and liaison
46. Specialized service facilities necessary keep the public informed on mat-
47.Taxes ters of public concern, such as notices of
48. Termination costs applicable to spon- Federal contract/grant awards, financial
sored agreements matters, etc.
49.Training costs e. Costs identified in subparagraphs c and d
50.Transportation costs if incurred for more than one Federal award
51. Travel costs or for both sponsored work and other work of
52. Trustees the non-profit organization, are allowable to
APPENDIX B TO PART 230—SELEC2'ND ITEMS OF the extent that the principles in Appendix A
COST to this part, paragraphs B. ("Direct Costs")
and C. ("Indirect Costs")are observed.
Paragraphs 1 through 52 of this appendix f. Unallowable advertising and public rela-
provide principles to be applied in estab- tions costs include the following:
lishing the allowability of certain items of (1) All advertising and public relations
cost. These principles apply whether a cost is costs other than as specified in subpara-
treated as direct or indirect. Failure to men- graphs c, d, and e;
tion a particular item of cost is not intended (2) Costs of meetings, conventions, con-
to imply that it is unallowable; rather, de- vocations, or other events related to other
termination as to allowability in each case activities of the non-profit organization, in-
should be based on the treatment or prin- eluding:
ciples provided for similar or related items (a) Costs of displays, demonstrations, and
of cost. exhibits;
1. Advertising and public relations costs. a, (b) Costs of meeting rooms, hospitality
The term advertising costs means the costs suites, and other special facilities used in
of advertising media and corollary adminis- conjunction with shows and other special
trative costs. Advertising media include events;and
magazines, newspapers, radio and television, (c) Salaries and wages of employees en-
direct mail, exhibits, electronic or computer gaged in setting up and displaying exhibits,
transmittals, and the like. making demonstrations, and providing brief-
b. The term public relations includes corn-
munity relations and means those activities ings;
dedicated to maintaining the image of the (3) Costs of promotional items and memo-
non-profit organization or maintaining or rabilia, including models, gifts, and sou-
promoting understanding and favorable rela- venirs;
tions with the community or public at large (4)Costs of advertising and public relations
or any segment of the public. designed solely to promote the non-profit or-
c. The only allowable advertising costs are ganization.
those which are solely for: 2. Advisory Councils. Costs incurred by ad-
(1) The recruitment of personnel required visory councils or committees are allowable
for the performance by the non-profit organi- as a direct cost where authorized by the Fed-
zatlon of obligations arising under a Federal eral awarding agency or as an indirect cost
award (See also paragraph 41, Recruiting where allocable to Federal awards.
costs, and paragraph 42, Relocation costs, of 3. Alcoholic beverages. Costs of alcoholic
this appendix); beverages are unallowable.
(2) The procurement of goods and services 4. Audit costs and related services. a. The
for the performance of a Federal award; costs of audits required by, and performed in
(3) The disposal of scrap or surplus mate- accordance with, the Single Audit Act, as
rials acquired in the performance of a Fed- implemented by Circular A-133, "Audits of
eral award except when non-profit organiza- States, Local Governments, and Non-Profit
tions are reimbursed for disposal costs at a Organizations" are allowable. Also see 31
predetermined amount; or U.S.C. 7505(b) and section 230("Audit Costs")
(4) Other specific purposes necessary to of Circular A-133.
meet, the requirements of the Federal award. b. Other audit costs are allowable if in-
d.The only allowable public relations costs eluded in an indirect cost rate proposal, or if
are. specifically approved by the awarding agen-
(1) Costs specifically required by the Fed- ey as a direct cost to an award.
eral award: c. The cost of agreed-upon procedures en-
(2) Costs of communicating with the public gagements to monitor subrecipients who are
and press pertaining to specific activities or exempted from A-133 under section 200(d) are
accomplishments which result from perform- allowable, subject to the conditions listed in
ance of Federal awards (these costs are con- A-133,section 230(b)(2)_
sidered necessary as part of the outreach ef- 5. Bad debts. Bad debts, including losses
fort for the Federal award); or (whether actual or estimated) arising from
(3)Costs of conducting general liaison with uncollectible accounts and other claims, re-
news media and government public relations lated collection costs, and related legal
officers, to the extent that such activities costs,are unallowable.
191
•
Pt. 230, App. B 2 CFR Ch. 11 (1-1-12 Edition)
d. Bonding cosh. a. Bending Costs arise d. Special considerations in determining
when the Federal Government requires as- allowability. Certain conditions require spe-
saare.nce, against financial loss Go itself or cial consideration and possible limitations in
anvil by reason of tthe ebt or default of the determining costs under Federal awards
non-profit organ.ietel re They ems' also-in where amounts or types of compensation ap-
i.nstenee s where the non-peoflt ocrahls a!tien pear unreasonable. Among such conditions
requires elniflar assurance.Included are such are the following:
bonds as bid,performance, payment,.advance (li Compensation to members of noon-profit
payment infvingement..and fidelity bowls. ni aaizations, trustees,director-a,ma agates.
h:. Costs of bonding required pursuant to officers, or they Immediate families thereof.
the terms of the award are allowable. Determination shoeld be made that su.oh
c. Costs of bonding required by the non- compensation is. reasonable for the actual.
profit organization in the general conduct of personal services rendered rather than a dia.
its operations are allowable to the extent trtlno.tion o f eai'ainge in'mess of mete.,
that such bonding is in accordance with (2) Any change ie 'an organi:zatioai's+ come
sound business practice and the rates and pensatiOil policy resulting in s subate.ntidal
premiums are reasonable wider the cir- increase in the organtzntion'R level of wear-
eurli'atsn.eel, pensation, particularly when it was concur-
? Gaauagiginicati n costs. Cans..inc-arced for rent with an increase in the ratio of Federal
telephone services, local and long diet,ance awards to other activities of the organize-
telephone paella, dolmas, postage,. rase- tion or any change in the treatment of al-
senger electronic or con 119iter transmittal lowability of specific types of compensation
serviced and the like are allowable_ due to elgea in Federal policy.
8. Colrr'ilieasat,ion for personal services. a... e_Unallowable costa.Ousts winch are anal-
Definition., Compensation for personal eery- luwnble wider-other paielgra hs of this ap-
iece ln:ciud as all compp9efetiun paid cur- pearlix that] not be alieleabie under tbi
rently or accrued by the orgenization, ter paragraph snidely on the basis that they con-
ser'vibes of- employees rendered alining the stteete persons].ratatrypdr<naatia ii,
period of the award (except u;t otherwise pro- f. Overtime, extra-pay ehi:ft, and multi-
vided in enbeaeagraph 8.11 of tide appendise, shift premiums.. Premiums for overtime,
rt pnledea, but is not, lirnit.eCi eo, salaries. ortra-pay shifts.and multi-thiit work are al-
wages.. director's end executive oorarniteee towable only with the prior approval of the
members fees, incentiVe awards, fringe bane awarding agency except:
Uts, pension plan costs, allowances for Off- (1) When necessary to cope with emer-
site pay, incentive pay, location ellowenc ,. genies, such as those resulting from acci-
hardship pay and cost of living differentials, dents, natural disasters, breakdowns of
b, s ilovrability_ Except as otherwise spe- equipment, or occasional operational bottle-
tild:�lly provided ia5. this paragraph., the necks of a sirs3r'ad:le nature.
costs of such.compensation aro allowable to (2) When iae37:ployea.e are pericrm.itg iudi-
the extent that;; rect functions,such as administration,main-
(ih Total compensation to iridividuga ern- tenance, or accounting.
Oloycesija; realreseenshie for the services roil- (3)In the performance of tests, laboratory
l erect and conforms s to the estebl•ishedi policy procedures, or other similar operations
Of the eLvaillgation consistently applied to which are continuous in nature and cannot
both Federal and iron lferlevsl.activities: end reasonably be interrupted or otherwise com-
a) Charges to, awardiee whether treated a pleted.
direct or indirect coals are determined and (4) When lower overall cost to the Federal
supported as required i;n this.paa.'egraph, Governmentwill benefits.result.(1) Fringe benefits in
c. Reasonableness. (I) When. the.organize- g•
Fringe tion is prod aninenti + engaged In activities the form of regular compensation paid to
other than those spoaacireil by the Federal. employees during periods of authorized ab-
Government, compensation for employees on senses from the job, such as vacation leave,
federally-sponsored work will be considered sick leave, military leave, and the like, are
reasonable to the extent that it is consistent allowable, provided such costs are absorbed
with that paid for similar work in the orga- by all organization activities in proportion
nizatioS"a ochereotxvitis s, to the relative amount of time or effort actu-
(2)When,.the or'gani;.ation is pterluininanttly ally devoted to each.
engaged in federally-sponsted activities and. (2) Fringe benefits in the form of employer
is ewes where the kind of employees re- contributions or expenses for social security,
qui_red for the Federal activities are not employee insurance, workmen's compensa-
found is the orgtiization's: other activities, tion insurance, pension plan costs (see sub-
cottipaenset1en for employees us federally- paragraph 8.h of this appendix), and the like,
sponsored work will be-considered reasonable are allowable, provided such benefits are
to the extent that it is comparable to that. granted in accordance with established writ-
paid.for similar work in the labor.markets in ten organization policies. Such benefits
which the organization competes for the whether treated as indirect costs or as direct
kind of employees involved. costs, shall be distributed to particular
192
OMB Circulars and Guidance Pt. 230, App. B
awards and other activities in a manner con- each quarter of the year to which such costs
sistent with the pattern of benefits accruing are assignable are unallowable.
to the individuals or group of employees (2) Pension plan termination insurance
whose salaries and wages are chargeable to premiums paid pursuant to the Employee
such awards and other activities. Retirement Income Security Act (ERISA) of
(3)(a) Provisions for a reserve under a self- 1974 (Pub. L. 93-406) are allowable. Late pay-
insurance program for unemployment corn- ment charges on such premiums are unallow-
pensation or workers' compensation are al- able.
lowable to the extent that the provisions (3) Excise taxes on accumulated funding
represent reasonable estimates of the liabil- deficiencies and other penalties imposed
ities for such compensation, and the types of' under ERISA are unallowable.
coverage, extent of coverage, and rates and j. Incentive compensation. Incentive corn-
premiums would have been allowable had in- pensation to employees based on cost reduc-
surance been purchased to cover the risks. Lion, or efficient performance, suggestion
However, provisions for self-insured liabil- awards, safety awards, etc., are allowable to
ities which do not become payable for more the extent that the overall compensation is
than one year after the provision is made determined to be reasonable and such costs
shall not exceed the present value of the 11- are paid or accrued pursuant to an agree-
ability. ment entered into in good faith between the
(b) Where an organization follows a con- organization and the employees before the
sistent policy of expensing actual payments services were rendered, or pursuant to an es-
to, or on behalf of, employees or former em- tablished plan followed by the organization
ployees for unemployment compensation rar so consistently as to imply, in effect, an
workers' compensation, such payments are agreement to make such payment,
allowable in the year of payment with the k. Severance pay. (1) Severance pay, also
prior approval of the awarding agency, pro- commonly referred to as dismissal wages, is
vided they are allocated to all activities of a payment in addition to regular salaries and
the organization. wages, by organizations to workers whose
(4) Costs of insurance on the lives of trust- employment is being terminated. Costs of
ees, officers, or other employees holding po- severance pay are allowable only to the ex-
sitions of similar responsibility are allow- tent that in each case,it is required by:
able only to the extent that the insurance (a)Law
represents additional compensation. The (b)Employer-employee agreement
costs of such insurance when the organiza- (c) Established policy that constitutes, in ef-
tion is named as beneficiary are unallowable. fect, an implied agreement on the organi-
h. Organization-furnished automobiles. zation's part, or
That portion of the cost of organization-fur- (d) Circumstances of the particular employ-
fished automobiles that relates to personal ment.
use by employees (including transportation (2) Costs of severance payments are divided
to and from work) is unallowable as fringe into two categories as follows:
benefit or indirect costs regardless of wheth- (a) Actual normal turnover severance pay-
er the cost is reported as taxable income to ments shall be allocated to all activities; or,
the employees. These costs are allowable as where the organization provides for a reserve
direct costs to sponsored award when nec- for normal severances, such method will be
essary for the performance of the sponsored acceptable if the charge to current oper-
award and approved by awarding agencies. ations is reasonable in light of payments ac-
i. Pension plan costs. (1) Costs of the orga- tually made for normal severances over a
nization's pension plan which are incurred in representative past period, and if amounts
accordance with the established policies of charged are allocated to all activities of the
the organization are allowable,provided: organization.
(a) Such policies meet the test of reason- (b) Abnormal or mass severance pay is of
ableness; such a conjectural nature that measurement
(b) The methods of cost allocation are not of costs by means of an accrual will not
discriminatory; achieve equity to both parties. Thus, accru-
(c) The cost assigned to each fiscal year is als for this purpose are not allowable. How-
determined in accordance with generally ac- ever, the Federal Government recognizes its
cepted accounting principles (GAAP), as pre- obligation to participate, to the extent of Its
scribed in Accounting Principles Board Opin- fair share,'in any specific payment. Thus, al-
ion No.8 issued by the American Institute of lowability will be considered on a case-by-
Certified Public Accountants; and case basis in the event or occurrence.
(d)The costs assigned to a given fiscal year (c) Costs incurred in certain severance pay
are funded for all plan participants within packages (commonly known as "a golden
six months after the end of that year. How- parachute" payment) which are in an
ever, increases to normal and past service amount in excess of the normal severance
pension costs caused by a delay in funding pay paid by the organization to an employee
the actuarial liability beyond 30 days after upon termination of employment and are
1 3
Pt. 230, App. B 2 CFR Ch. II (1-1-12 Edition)
paid to the employee contingent upon a of the activities performed by the employee,
change in management control over, or own- that the distribution of activity represents a
ership of, the organization's assets are unal- reasonable estimate of the actual work per-
lowable. formed by the employee during the periods
(d) Severance payments to foreign nation- covered by the reports.
als employed by the organization outside the (d) The reports must be prepared at least
United States, to the extent that the amount monthly and must coincide with one or more
exceeds the customary or prevailing prac- pay periods.
tices for the organization in the United (3) Charges for the salaries and wages of
States are unallowable, unless they are net- nonprofessional employees, in addition to
essary for the performance of Federal pro- the supporting documentation described in
grams and approved by awarding agencies. subparagraphs (1) and (2), must also be sup-
(e) Severance payments to foreign nation- ported by records indicating the total num-
als employed by the organization outside the ber of hours worked each day maintained in
United States due to the termination of the conformance with Department of Labor reg-
foreign national as a result of the closing of, ulations implementing the Fair Labor
or curtailment of activities by, the organize- Standards Act (FLSA)(29 CFR part 516). For
tion in that country, are unallowable, unless this purpose, the term "nonprofessional em-
they are necessary for the performance of ployee" shall have the same meaning as
Federal programs and approved by awarding "nonexempt employee," under FLSA.
agencies. (4) Salaries and wages of employees used in
1. Training costs. See paragraph 49 of this meeting cost sharing or matching require-
appendix. ments on awards must be supported in the
m. Support of salaries and wages. same manner as salaries and wages claimed
(1) Charges to awards for salaries and for reimbursement from awarding agencies.
wages, whether treated as direct costs or in- 9. Contingency provisions. Contributions
direct costs, will be based on documented to a contingency reserve or any similar pro-
payrolls approved by a responsible official(s) vision made for events the occurrence of
of the organization. The distribution of sala- which cannot be foretold with certainty as
ries and wages to awards must be supported to time, intensity, or with an assurance of
by personnel activity reports, as prescribed their happening, are unallowable. The term
in subparagraph 8.m.(2) of this appendix, ex- "contingency reserve" excludes self-insur-
cept when a substitute system has been ap- ance reserves (see Appendix B to this part,
proved in writing by the cognizant agency. paragraphs 8.g.(3) and 22.a(2)(d)); pension
(See subparagraph E.2 of Appendix A to this 'funds (see paragraph 8.1): and reserves for
part.) normal severance pay(see paragraph 8.k.)
(2) Reports reflecting the distribution of 10.Defense and prosecution of criminal and
activity of each employee must be main- civil proceedings, claims, appeals and patent
tamed for all staff members (professionals infringement,
and nonprofessionals)whose compensation is a. Definitions. (1) Conviction, as used here-
charged, in whole or in part, directly to in, means a judgment or a conviction of a
awards. In addition, in order to support the criminal offense by any court of competent
allocation of indirect costs, such reports jurisdiction, whether entered upon as a ver-
must also be maintained for other employees dict or a plea, including a conviction due to
whose work involves two or more functions a plea of nolo contendere.
or activities if a distribution of their corn- (2) Costs include, but are not limited to,
pensation between such functions or activi- administrative and clerical expenses; the
ties is needed in the determination of the or- cost of legal services, whether performed by
ganization's indirect cost rate(s)(e.g.,an em- in-house or private counsel; and the costs of
ployee engaged part-time in indirect cost ac- the services of accountants, consultants, or
tivities and part-time in a direct function). others retained by the organization to assist
Reports maintained by non-profit organize- it; costs of employees, officers and trustees,
tions to satisfy these requirements must and any similar costs incurred before. dur-
meet the following standards: ing, and after commencement of a judicial or
(a) The reports must reflect an after-the- administrative proceeding that bears a di-
fact determination of the actual activity of rect relationship to the proceedings.
each employee. Budget estimates (i.e., esti- (3) Fraud, as used herein, means acts of
mates determined before the services are fraud corruption or attempts to defraud the
performed) do not qualify as support for Federal Government or to corrupt its agents,
charges to awards. acts that constitute a cause for debarment
(b) Each report must account for the total or suspension (as specified in agency regula-
activity for which employees are corn- tions). and acts which violate the False
pensated and which is required in fulfillment Claims Act, 31 U.S.C., sections 3729-3731, or
of their obligations to the organization. the Anti-Ifickback Act, 41 U.S.C., sections 51
(c) The reports must be signed by the indi- and 54.
vidual employee, or by a responsible super- (4)Penalty does not include restitution.re-
visory official having first hand knowledge imbursement, or compensatory damages.
194
OMB Circulars and Guidance Pt. 230, App. B
(5)Proceeding includes an investigation. (1) The costs are reasonable in relation to
b. (1) Except as otherwise described herein, the activities required to deal with the pro-
costs incurred in connection with any crimi- ceeding and the underlying cause of action:
nal, civil or administrative proceeding (in- (2)Payment of the costs incurred, as allow-
eluding filing of a false certification) corn- able and allocable costs, is not prohibited by
menced by the Federal Government, or a any other provision(s) of the sponsored
State, local or foreign government, are not award;
allowable if the proceeding: Relates to a vie- (3) The costs are not otherwise recovered
lation of, or failure to comply with, a Fed- from the Federal Government or a third
eral, State, local or foreign statute or regu- party, either directly as a result of the pro-
lation by the organization (including its ceeding or otherwise: and,
agents and employees),and results in any of (4) The percentage of costs allowed does
the following dispositions: not exceed the percentage determined by an
(a) In a criminal proceeding, a conviction. authorized Federal official to be appropriate,
(b) In a civil or administrative proceeding considering the complexity of the litigation,
involving an allegation of fraud or similar generally accepted principles governing the
misconduct, a determination of organiza- award of legal fees in civil actions involving
tional liability. the United States as a party, and such other
(c) In the case of any civil or administra- factors as may be appropriate. Such percent-
tive proceeding, the imposition of a mone age shall not exceed 80 percent. However, if
tary penalty. an agreement reached under subparagraph
(d) A final decision by an appropriate Fed- 10.c of this appendix has explicitly consid-
eral official to debar or suspend the toFedered this 80 percent limitation and permitted
organi-
zation, to rescind or void an award, or to ter- a higher percentage, then the full amount of
minate an award for default by reason of a costs resulting from that agreement shall be
violation or failure to comply with a law or allowable,
regulation. f. Costs incurred by the organization in
(e) A disposition consent or corn- connection with the defense of suits brought
promise, if the action bycyuld have resultedoc in by its employees or ex-employees under sec-
L.
any of the dispositions described in subpara- tion0 - 2 ),o includingthe Major Fraud Act of all relief(Pub.nec-
graphs 10.b.(1)(a), (b), (c) or(d) of this appen- 100-700), the cost of essary to make such employee whole, where
ills,
(2) If more than one the organization was found liable or settled,
proceeding involves are unallowable.
the same alleged misconduct, the costs of all g, Costs of legal, accounting, and consult-
such proceedings shall be unallowable if any ant services, and related costs, incurred in
one of them results in one of the dispositions connection with defense against Federal
shown in subparagraph 10.b.(1) of this appen- Government claims or appeals, antitrust
dix. suits, or the prosecution of claims or appeals
c. If a proceeding referred to in subpara- against the Federal Government, are unal-
graph 10_b of this appendix is commenced by lowable.
the Federal Government and is resolved by h. Costs of legal, accounting, and consult-
consent or compromise pursuant to an agree- ant services, and related costs, incurred in
ment entered into by the organization and connection with patent infringement litiga-
the Federal Government, then the costs in- tion, are unallowable unless otherwise pro-
curred by the organization in connection vided for in the sponsored awards.
with such proceedings that are otherwise not i. Costs which may be unallowable under
allowable under subparagraph 10.b of this ap- this paragraph, including directly associated
pendix may be allowed to the extent specifi- costs, shall be segregated and accounted for
cally provided in such agreement. by the organization separately. During the
d. If a proceeding referred to in subpara- pendency of any proceeding covered by sub-
graph 10.b of this appendix is commenced by paragraphs 10.b and f of this appendix, the
a State, local or foreign government, the au- Federal Government shall generally with-
thorized Federal official may allow the costs hold payment of such costs. However, if in
incurred by the organization for such pro- the best interests of the Federal Govern-
ceedings, if such authorized official deter- ment, the Federal Government may provide
mines that the costs were incurred as a re- for conditional payment upon provision of
suit of a specific term or condition of a fed- adequate security, or other adequate assur-
orally-sponsored award, or specific written ante, and agreements by the organization to
direction of an authorized official of the repay all unallowable costs, plus interest, if
sponsoring agency. the costs are subsequently determined to be
e. Costs incurred in connection with pro- unallowable.
ceedings described in subparagraph 10.b of 11. Depreciation and use allowances. a.
this appendix, but which are not made anal- Compensation for the use of buildings, other
lowable by that subparagraph, may be al- capital improvements, and equipment on
lowed by the Federal Government, but only hand may be made through use allowance or
to the extent that: depreciation. However, except as provided in
195
Pt. 230, App. B 2 CFR Ch. II (1-1-12 Edition)
paragraph 11.f of this appendix, a combing- under subparagraph ll.d of this appendix,
tion of the two methods may not be used in would be viewed as fully depreciated. How-
connection with a single class of fixed assets ever, a reasonable use allowance may be ne-
(e.g., buildings, office equipment, computer gotiated for such assets if warranted after
equipment, etc.). taking into consideration the amount of de-
b. The computation of use allowances or preciation previously charged to the Federal
depreciation shall be based on the acquisi- Government, the estimated useful life re-
tion cost of the assets involved. The acquisi- maining at time of negotiation, the effect of
tion cost of an asset donated to the non-prof- any increased maintenance charges or de-
it organisation by a third party shall be its creased efficiency due to age, and any other
fair market value at the time of the Bona- factors pertinent to the utilization of the
tion. asset for the purpose contemplated.
c. The computation of use allowances or g. Criteria where the use allowance method
depreciation will exclude: is followed:
(1)The cost of land; (1)The use allowance for buildings and im-
(2) Any portion of the cost of buildings and provement (including land improvements,
equipment borne by or donated by the Fed- such as paved parking areas, fences, and
eral Government irrespective of where title sidewalks) will be computed at an annual
was originally vested or where it presently rate not exceeding two percent of acquisition
resides;and cost.
(3) Any portion of the cost of buildings and (2)The use allowance for equipment will be
equipment contributed by or for the non- computed at an annual rate not exceeding
profit organization in satisfaction of a statu- six and two-thirds percent of acquisition
tory matching requirement. cost, When the use allowance method is used
d. General criteria where depreciation for buildings, the entire building must be
method is followed: treated as a single asset; the building's com-
a) The period of useful service (useful life) ponents (e.g., plumbing system, heating and
established in each case for usable capital air conditioning, etc.) cannot be segregated
assets must take into consideration such fac- from the building's shell.
tors as type of construction, nature of the (3) The two percent limitation, however,
equipment used, technological developments need not be applied to equipment which is
in the particular program area, and the re- merely attached or fastened to the building
newal and replacement policies followed for but not permanently fixed to it and which is
the individual items or classes of assets in- used as furnishings or decorations or for spe-
volved. The method of depreciation used to cialized purposes (e.g., dentist chairs and
assign the cost of an asset (or group of as- dental treatment units, counters, laboratory
sets) to accounting periods shall reflect the benches bolted to the floor, dishwashers,
pattern of consumption of the asset during modular furniture, carpeting, etc.). Such
its useful life. equipment will be considered as not being
(2) In the absence of clear evidence indi- permanently fixed to the building if it can be
eating that the expected consumption of the removed without the need for costly or ex-
asset will be significantly greater or lesser in tensive alterations or repairs to the building
the early portions of its useful life than in or the equipment. Equipment that meets
the later portions, the straight-line method these criteria will be subject to the 6% per-
shall be presumed to be the appropriate cent equipment use allowance limitation.
method. h. Charges for use allowances or deprecia-
(3) Depreciation methods once used shall tion must be supported by adequate property
not be changed unless approved in advance records and physical inventories must be
by the cognizant Federal agency. When the taken at least once every two years (a statis-
depreciation method is introduced for appli- tical sampling basis is acceptable) to ensure
cation to assets previously subject to a use that assets exist and are usable and needed.
allowance, the combination of use allow- When the depreciation method is followed,
ances and depreciation applicable to such as- adequate depreciation records indicating the
sets must not exceed the total acquisition amount of depreciation taken each period
cost of the assets. must also be maintained.
e. When the depreciation method is used 12. Donations and contributions.
for buildings, a building's shell may be seg- a. Contributions or donations rendered,
negated from each building component (e.g., Contributions or donations, including cash,
plumbing system, heating, and air condi- property, and services, made by the organi-
tioning system, etc.) and each item depre- zation, regardless of the recipient, are unal-
ciated over its estimated useful life; or the lowable.
entire building (i.e., the shell and all compo- b.Donated services received:
nents) may be treated as a single asset and (1) Donated or volunteer services may be
depreciated over a single useful life. furnished to an organization by professional
f.When the depreciation method is used for and technical personnel, consultants, and
a particular class of assets, no depreciation other skilled and unskilled labor. The value
may be allowed on any such assets that, of these services is not reimbursable either
t1i6
OMB Circulars and Guidance Pt. 230, App. B
as a direct or indirect cost. However, the b. Such costs will be equitably apportioned
value of donated services may be used to to all activities of the non-profit organiza-
meet cost sharing or matching requirements tion. Income generated from any of these ac-
in accordance with the Common Rule. tivities will be credited to the cost thereof
(2)The value of donated services utilized in unless such income has been irrevocably set
the performance of a direct cost activity over to employee welfare organizations.
shall, when material in amount, be consid- 14. Entertainment costs. Costs of enter-
ered in the determination of the non-profit tainment, including amusement, diversion,
organization's indirect costs or rate(s) and, and social activities and any costs directly
accordingly, shall be allocated a propor- associated with such costs (such as tickets
tionate share of applicable indirect costs to shows or sports events, meals, lodging,
when the following exist: rentals, transportation, and gratuities) are
(a) The aggregate value of the services unallowable.
material;
(b)The services are supported by a signifi- 15. Equipment and other capital expendi-
cant amount of the indirect costs incurred tares.
by the non-profit organization;and a. For purposes of this subparagraph, the
(c) The direct cost activity is not pursued following definitions apply:
primarily for the benefit of the Federal Gov- (1) "Capital Expenditures" means expendi-
ernment. tures for the acquisition cost of capital as-
(3) In those instances where there is no sets(equipment, buildings, land), or expendi-
basis for determining the fair market value tures to make improvements to capital as-
of the services rendered, the recipient and sets that materially increase their value or
the cognizant agency shall negotiate an ap- useful life. Acquisition cost means the cost
propriate allocation of indirect cost to the of the asset including the cost to put it in
services. place. Acquisition cost for equipment, for ex-
(4) Where donated services directly benefit ample, means the net invoice price of the
a project supported by an award, the indirect equipment, including the cost of any modi-
costs allocated to the services will be consid- fications, attachments, accessories, or auxil-
ered as a part of the total costs of the iary apparatus necessary to make it usable
project. Such indirect costs may be reim- for the purpose for which it is acquired. An-
bursed under the award or used to meet cost cillary charges, such as taxes, duty, protec-
shar ng or matching requirements_ tive in transit insurance, freight, and instal-
(5) The value of the donated services may lation may be included in, or excluded from
be used to meet cost sharing or matching re- the acquisition cost in accordance with the
quirements under conditions described in non-profit organization's regular accounting
Section 215.23 of 2 CFR part 215 (OMB Cir- practices.
cular A-110). Where donated services are (2) "Equipment" means an article of non-
treated as indirect costs, indirect cost rates expendable, tangible personal property hav-
will separate the value of the donations so ing a useful life of more than one year and
that reimbursement will not be made. an acquisition cost which equals or exceeds
c. Donated goods or space. (1) Donated the lesser of the capitalization level estab-
goods; i.e., expendable personal property/sup lished by the non-profit organization for fi-
plies, and donated use of space may be fur- nancial statement purposes, or$5000,
nished to a non-profit organization. The
value of the goods and space is not reimburs_ (3) "Special purpose equipment" means
able either as a direct or indirect cost. equipment which is used only for research,
(2)The value of the donations may be used medical, scientific, or other technical activi-
to meet cost sharing or matching share re- ties. Examples of special purpose equipment
quirements under the conditions described in include microscopes, x-ray machines, 3nr-
2 CFR part 215 (OMB Circular A-110). Where gical instruments, and spectrometers.
donations are treated as indirect costs, indi- (4) "General purpose equipment" means
rect cost rates will separate the value of the equipment, which is not limited to research,
donations so that reimbursement will not be medical, scientific or other technical activi-
made. ties. Examples include office equipment and
13. Employee morale, health, and welfare furnishings, modular offices, telephone net-
costs. works, information technology equipment
a. The costs of employee information pub- and systems, air conditioning equipment, re-
lications, health or first-aid clinics and/or .production and printing equipment, and
infirmaries, recreational activities, ern., motor vehicles,
ployee counseling services, and any other ex- b. The following rules of allowability shall
penses incurred in accordance with the non- apply to equipment and other capital r;x-
profit organization's established practice or penditures:
custom for the improvement of working con- (1) Capital expenditures for general pur-
ditions, employer-employee relations, an- pose equipment, buildings, and land are unal-
ployee morale, and employee performance lowable as direct charges, except where sp-
are allowable proved in advance by the awarding agency.
197
Pt. 230, App. B 2 CFR Ch. II (1-1-12 Edition)
(2)Capital expenditures for special purpose shall be the difference between the amount
equipment are allowable as direct costs, pro- realized on the property and the
vided that items with a unit cost of$5000 or undepreciated basis of the property.
more have the prior approval of the awarding (2) Gains and losses on the disposition of
agency. depreciable property shall not be recognized
(3) Capital expenditures for improvements as a separate credit or charge under the fol-
to land, buildings, or equipment which mate- lowing conditions:
rially increase their value or useful life are (a)The gain or loss is processed through a
unallowable as a direct cost except with the depreciation account and is reflected in the
prior approval of the awarding agency. depreciation allowable under paragraph 11 of
(4)When approved as a direct charge pursu- this appendix.
ant to paragraph 15.b.(1), (2), and (3) above, (b) The property is given in exchange as
capital expenditures will be charged in the part of the purchase price of a similar item
period in which the expenditure is incurred, and the gain or loss is taken into account in
or as otherwise determined appropriate by determining the depreciation cost basis of
and negotiated with the awarding agency. the new item.
(5) Equipment and other capital expends- (c)A loss results from the failure to main-
tures are unallowable as indirect costs. How- tain permissible insurance, except as other-
ever, see paragraph 11., Depreciation and use wise provided in paragraph 22 of this appen-
allowance, of this appendix for rules on the affix.
allowability of use allowances or deprecia- (d) Compensation for the use of the prop-
tion on buildings, capital improvements, and erty was provided through use allowances in
equipment. Also, see paragraph 43., Rental lieu of depreciation in accordance with pare-
costs of buildings and equipment, of this ap- graph 9 of this appendix.
pendix for rules on the allowability of rental (e) Gains and losses arising from mass or
costs for land, buildings,and equipment. extraordinary sales, retirements, or other
(6) The unamortized portion of any equip- dispositions shall be considered on a case-by-
ment written off as a result of a change in case basis.
capitalization levels may be recovered by b. Gains or losses of any nature arising
continuing to claim the otherwise allowable from the sale or exchange of property other
use allowances or depreciation on the equip- than the property covered in subparagraph a
ment, .or by amortizing the amount to be shall be excluded in computing award costs.
written off over a period of years negotiated 19. Goods or services for personal use,
with the cognizant agency. Costs of goods or services for personal use of
16. Fines and penalties. Costs of fines and the organization's employees are unallow-
penalties resulting from violations of, or able regardless of whether the cost is re-
failure of the organization to comply with ported as taxable income to the employees.
Federal, State, and local laws and regale- 20. Housing and personal living expenses. a.
tions are unallowable except when incurred Costs of housing (e.g., depreciation, mainte-
as a result of compliance with specific provi- nance, utilities, furnishings, rent, etc.).
sions of an award or instructions in writing housing allowances and personal living ex-
from the awarding agency. penses for/of the organization's officers are
17. Fund raising and investment manage- unallowable as fringe benefit or indirect
ment costs. a. Costs of organized fund rais- costs regardless of whether the cost is re-
ing, including financial campaigns, endow- ported as taxable income to the employees.
ment drives, solicitation of gifts and be- These costs are allowable as direct costs to
quests, and similar expenses incurred solely sponsored award when necessary for the per-
to raise capital or obtain contributions are formance of the sponsored award and ap-
unallowable. proved by awarding agencies.
b. Costs of investment counsel and staff b. The term "officers"includes current and
and similar expenses incurred solely to en- past officers and employees.
hence income from investments are unallow- 21. Idle facilities and idle capacity. a. As
able. used in this section the following terms have
c. Fund raising and investment activities the meanings set forth below:
shall be allocated an appropriate share of in- (1) "Facilities" means land and buildings
direct costs under the conditions described or any portion thereof, equipment individ-
in subparagraph B.3 of Appendix A to this ually or collectively, or any other tangible
part. capital asset, wherever located, and whether
18. Gains and losses on depreciable assets. owned or leased by the non-profit organiza-
a. (1)Gains and losses on sale,retirement, or Lion.
other disposition of depreciable property (2) "Idle facilities" means completely un-
shall be included in the year in which they used facilities that are excess to the non-
occur as credits or charges to cost group- profit organization's current needs.
ing(s)in which the depreciation applicable to (3) "Idle capacity" means the unused ca-
such property was included. The amount of pacity of partially used facilities. It is the
the gain or loss to be included as a credit or difference between: That which a facility
charge to the appropriate cost grouping(s) could achieve under 100 percent operating
198
OMB Circulars and Guidance Pt. 230, App. B
time on a one-shift basis less operating the rates and premiums shall be reasonable
interruptions resulting from time lost for re- under the circumstances.
pairs, setups, unsatisfactory materials, and (b) Costs allowed for business interruption
other normal delays; and the extent to which or other similar insurance shall be limited to
the facility was actually used to meet de- exclude coverage of management fees.
mends during the accounting period. A (c) Costs of insurance or of any provisions
multi-shift basis should be used if it can be for a reserve covering the risk of loss or
shown that this amount of usage would nor- damage to Federal property are allowable
mally be expected for the type of facility in- only to the extent that the organization is
volved. liable for such loss or damage.
(4) '`Cost of idle facilities or idle capacity" (d) Provisions for a reserve under a self-in-
means costs such as maintenance, repair, surance program are allowable to the extent
housing, rent, and other related costs. e.g., that types of coverage, extent of coverage,
insurance, interest, property taxes and de- rates, and premiums would have been al-
preciation or use allowances. lowed had insurance been purchased to cover
b. The costs of idle facilities are unallow- the risks. However, provision for known or
able except to the extent that: reasonably estimated self-insured liabilities,
(1)They are necessary to meet fluctuations which do not become payable for more than
in workload; or one year after the provision is made, shall
(2) Although not necessary to meet flue- not exceed the present value of the liability.
tuations in workload, they were necessary (e) Costs of insurance on the lives of trust-
when acquired and are now idle because of ees, officers, or other employees holding po-
changes in program requirements, efforts to sitions of similar responsibilities are allow-
achieve more economical operations, reorga- able only to the extent that the insurance
nization, termination, or other causes which represents additional compensation (see sub-
could not have been reasonably foreseen. paragraph 8.g(4) of this appendix). The cost
Under the exception stated in this subpara- of such insurance when the organization is
graph. costs of idle facilities are allowable identified as the beneficiary is unallowable.
for a reasonable period of time, ordinarily (f) Insurance against defects. Costs of in-
not to exceed one year, depending on the ini- surance with respect to any costs incurred to
tiative taken to use, lease, or dispose of such correct defects in the organization's mate-
facilities. rials or workmanship are unallowable.
c. The costs of idle capacity are normal (g) Medical liability (malpractice) insur-
costs of doing business and are a factor in ance. Medical liability insurance is an allow-
the normal fluctuations of usage or indirect able cost of Federal research programs only
cost rates from period to period. Such costs to the extent that the Federal research pro-
are allowable, provided that the capacity is grams involve human subjects or training of
reasonably anticipated to be necessary or participants in research techniques. Medical
was originally reasonable and is not subject liability insurance costs shall be treated as a
to reduction or elimination by use on other direct cost and shall be assigned to indi-
Federal awards, subletting, renting, or sale, vidual projects based on the manner in which
in accordance with sound business, eco- the insurer allocates the risk to the popu-
nomic, or security practices. Widespread idle lation covered by the insurance.
capacity throughout an entire facility or (3) Actual losses which could have been
among a group of assets having substantially covered by permissible insurance (through
the same function may be considered idle fa- the purchase of insurance or a self-insurance
eilities. program) are unallowable unless expressly
22. Insurance and indemnification.a.Incur- provided for in the award, except:
ance includes insurance which the organize- (a) Costs incurred because of losses milk
tion is required to carry, or which is ap- covered under nominal deductible insurance
proved, under the terms of the award and coverage provided in keeping with sound
any other insurance which the organization business practice are allowable.
maintains in connection with the general (b) Minor losses not covered by insurance,
conduct of its operations. This paragraph such as spoilage, breakage, and disappear-
does not apply to insurance which represents ance of supplies, which occur in the ordinary
fringe benefits for employees (see subpara- course of operations,are allowable.
graphs 8.g and 8.1(2)of this appendix). b. Indemnification includes securing t1I
(1) Costs of insurance required or approved, organization against liabilities to third per-
and maintained, pursuant to the award are sons and any other loss or damage, not corn-
allowable. pensated by insurance or otherwise.The Fed-
(2) Costs of other insurance maintained by eral Government is obligated to indemnify
the organization in connection with the gen- the organization only to the extent expressly
eral conduct of its operations are allowable provided in the award.
subject to the following limitations: 23. Interest. a. Costs incurred for interest
(a)Types and extent of coverage shall be in on borrowed capital, temporary use of en-
accordance with sound business practice and dowment funds, or the use of the non-profit
Pt. 230, App. B 2 CFR Ch. 11 (1-1-12 Edition)
organization's own funds, however rep- bargain purchase option, operating and
resented, are unallowable. However, interest maintenance costs, and taxes not included in
on debt incurred after September 29,,1995 to the capital leasing arrangement, less any es-
acquire or replace capital assets (including timated credits due under the lease at the
renovations, alterations, equipment, land, end of the period defined above. Projected
and capital assets acquired through capital operating lease costs shall be based on the
leases), acquired after September 29, 1995 and anticipated cost of leasing comparable facili-
used in support of Federal awards is allow- ties at fair market rates under rental agree-
able,provided that: ments that would be renewed or reestab-
(1) For facilities acquisitions (excluding lished over the period defined above, and any
renovations and alterations) costing over$10 expected maintenance costs and allowable
million where the Federal Government's re- property taxes to be borne by the non-profit
imbursement is expected to equal or exceed organization directly or as part of the lease
40 percent of an asset's cost, the non-profit arrangement.
organization prepares, prior to the acquisi- (3) The actual interest cost claimed is
tion or replacement of the capital asset(s), a predicated upon interest rates that are no
justification that demonstrates the need for higher than the fair market rate available to
the facility in the conduct of federally-spon- the non-profit organization from an unre-
sored activities. Upon request, the needs jus- lated("arm's length")third party.
tification must be provided to the Federal (4) Investment earnings, including interest
agency with cost cognizance authority as a income, on bond or loan principal, pending
prerequisite to the continued allowability of payment of the construction or acquisition
interest on debt and depreciation related to costs, are used to offset allowable interest
the facility. The needs justification for the cost.Arbitrage earnings reportable to the In-
acquisition of a facility should include, at a ternal Revenue Service are not required to
minimum, the following: be offset against allowable interest costs.
(a) A statement of purpose and justifica- (5) Reimbursements are limited to the
tion for facility acquisition or replacement. least costly alternative based on the total
(b) A statement as to why current facili- cost analysis required under subparagraph
ties are not adequate. 23,b. of this appendix. For example, if an op-
(c) A statement of planned future use of erating lease is determined to be less costly
the facility. than purchasing through debt financing,
(d) A description of the financing agree- then reimbursement is limited to the
went to be arranged for the facility. amount determined if leasing had been used.
(e) A summary of the building contract In all cases where a lease/purchase analysis
with estimated cost information and state- is performed, Federal reimbursement shall
ment of source and use of funds. be based upon the least expensive alter-
(f) A schedule of planned occupancy dates. native.
(2) For facilities costing over $500,000, the (6) Non-profit organizations are also sub-
non-profit organization prepares,prior to the ject to the following conditions:
acquisition or replacement of the facility, a (a) Interest on debt incurred to finance or
lease/purchase analysis in accordance with refinance assets acquired before or reac-
the provisions of§§2.15.30 through 215.37 of 2 quired after September 29, 1995, is not allow-
CFR 215 (OMB Circular A-110), which shows able.
that a financed purchase or capital lease is (b) Interest attributable to fully depre-
•less costly to the organization than other ciated assets is unallowable.
leasing alternatives, on a net present value (c) For debt arrangements over$1 million,
basis. Discount-rates used should be equal to unless the non-profit organization makes an
the non-profit organization's anticipated in- initial equity contribution to the asset pur-
terest rates and should be no higher than the chase of 25 percent or more, non-profit orga-
fair market rate available to the non-profit nizations shall reduce claims for interest ex-
organization from an unrelated ("arm's pense by an amount equal to imputed inter-
length") third-party. The lease/purchase est earnings on excess cash flow, which is to
analysis shall include a comparison of the be calculated as follows. Annually, non-prof-
net present value of the projected total cost it organizations shall prepare a. cumulative
comparisons of both alternatives over the pe- (from the inception of the project) report of
riod the asset is expected to be used by the monthly cash flows that includes inflows and
non-profit organization. The cost compari- outflows, regardless of the funding source.
sons associated with purchasing the facility Inflows consist of depreciation expense, am-
shall include the estimated purchase price, ortization of capitalized construction inter-
anticipated operating and maintenance costs eat, and annual interest expense. For cash
(including property taxes, if applicable) not flow calculations, the annual inflow figures
included in the debt financing, less any esti- shall be divided by the number of months in
mated asset salvage value at the end of the the year (usually 12) that the building is in
period defined above. The cost comparison service for monthly amounts. Outflows con-
for a capital lease shall include the esti- sist of initial equity contributions, debt
mated total lease payments, any estimated principal payments (less the pro rata share
200
OMB Circulars and Guidance Pt. 230, App. B
attributable to the unallowable costs of (1) Attempts to influence the outcomes of
land) and interest payments. Where cumu- any Federal, State, or local election, ref-
lative inflows exceed cumulative outflows', erendum, initiative, or similar procedure,
interest shall be calculated on the excess through in kind or cash contributions, en-
inflows for that period and be treated as a re- dorsements, publicity, or similar activity;
duction to allowable interest expense. The (2) Establishing, administering, contrib-
rate of interest to be used to.compute earn- uting to, or paying the expenses of a polit-
ings on excess cash flows shall be the three ical party, campaign, political action corn-
month Treasury Bill closing rate as of the mittee, or other organization established for
last business day of that month. the purpose of influencing the outcomes of
(d) Substantial relocation of federally- elections;
sponsored activities from a facility financed (3)Any attempt to influence: The introduc-
by indebtedness, the cost of which was fund- tion of Federal or State legislation; or the
ed in whole or part through Federal reirn- enactment or modification of any pending
bursements, to another facility prior to the Federal or State legislation through commu-
expiration of a period of 20 years requires no- nication with any member or employee of
tice to the Federal cognizant agency. The ex- the Congress or State legislature (including
tent of the relocation, the amount of the efforts to influence State or local officials to
Federal participation in the financing, and engage in similar lobbying activity), or with
the depreciation and interest charged to date any Government official or employee in con-
may require negotiation and/or downward nection with a decision to sign or veto en-
adjustments of replacement space charged to rolled legislation;
Federal programs in the future. (4)Any attempt to influence:The introduc-
e) The allowable costs to acquire facilities tion of Federal or State legislation; or the
and equipment are limited to a fair market enactment or modification of any pending
value available to the non-profit organiza- Federal or State legislation by preparing,
tion from an unrelated ("arm's length") distributing or using publicity or propa-
third party, ganda, or by urging members of the general
b. For non-profit organizations subject to public or any segment thereof to contribute
"full co non-pr under thei Cost to or participate in any mass demonstration.
"full
coves (CAS) as deeined at Accounting8 CFR march, rally, fundraising drive, lobbying
cam-
9903.201, the interest allowability provisions campaign or letter writing or telephone r
of subparagraph a do not apply. Instead, paig
these organizations' sponsored agreements (5) Legislativeaceataison activities, including
are subject to CAS 414 (48 CFR 9903.414), cost raitattendance hearings,legislativegatheringsessions tior core-
re-
of money as an element of the cost of facili- gar inee ilatiddanalyzing information effect
garding legislation, and the effect
ties capital, and CAS 417 (48 CFR 9903.417), of legislation, when such activities are car-
cost of money as an element of the cost of vied on in support of or in knowing prepara-
capital assets under construction. tion for an effort to engage
c. The following definitions are to be used in unallowable
lobbying.
for purposes of this paragraph: b. The following activities are excepted
(1) Re-acquired assets means assets held by from the coverage of subparagraph 25.a of
the non-profit organization prior to Sep- this appendix:
tember 29, 1995 that have again come to be (1) Providing a technical and factual pres-
held by the organization, whether through entation of information on a topic directly
repurchase or refinancing. It does not in- related to the performance of a grant, con-
clude assets acquired to replace older assets. tract or other agreement through hearing
(2) Initial equity contribution means the testimony, statements or letters to the Con-
amount or value of contributions made by gress or a State legislature, or subdivision,
non-profit organizations for the acquisition member, or cognizant staff member thereof,
of the asset or prior to occupancy of facili- in response to a documented request(includ-
ties. hag a Congressional Record notice requesting
(3) Asset costs means the capitalizable testimony or statements for the record at a
costs of an asset, including construction regularly scheduled hearing) made by the re-
costs, acquisition costs, and other such costs cipient member, legislative body or subdivi-
capitalized in accordance with GAAP. sion, or a cognizant staff member thereof;
24. Labor relations costs, Costs incurred in provided such information is readily obtain-
maintaining satisfactory relations between able and can be readily put in deliverable
the organization and its employees, includ- form; and further provided that costs under
ing costs of labor management committees, this section for travel, lodging or meals are
employee publications, and other related ac- unallowable unless incurred to offer testi-
tivities are allowable. mony at a regularly scheduled Congressional
25. Lobbying. a. Notwithstanding other hearing pursuant to a written request for
provisions of this appendix, costs associated such presentation made by the Chairman or
with the following activities are unallow- Ranking Minority Member of the Committee
able: or Subcommittee conducting such hearing.
201
Pt. 230, App. B 2 CFR Ch. II (1-1-12 Edition)
(2) Any lobbying made unallowable by sub- of the Executive Branch of the Federal Gov-
paragraph 25.a.(3) of this appendix to influ- ernment to give consideration or to act re-
ence State legislation in order to directly re- garding a sponsored agreement or a regu-
duce the cost, or to avoid material impair- latory matter are unallowable. Improper in-
ment of the organization's authority to per- fluence means any influence that induces or
form the grant, contract, or other agree- tends to induce a Federal employee or officer
ment, to give consideration or to act regarding a
(3) Any activity specifically authorized by federally-sponsored agreement or regulatory
statute to be undertaken with funds from matter on any basis other than the merits of
the grant,contract, or other agreement. the matter.
c. (1) When an organization seeks reim- 26. Losses on other sponsored agreements
bursement for indirect costs, total lobbying er contracts. Any excess of costs over in-
costs shall be separately identified in the in- come on any award is unallowable as a cost
direct cost rate proposal, and thereafter of any other award. This includes, but is not
treated as other unallowable activity costs limited to, the organization's contributed
in accordance with the procedures of sub-
paragraph B.3 of Appendix A to this part. portion by reason of cost sharing agreements
(2) Organizations shall submit, as part of or any under-recoveries through negotiation
the annual indirect cost rate proposal, a cer- of lump mime for, or ceilings on, indirect
tification that the requirements and stand- costs,
ards of this paragraph have been complied 27. Maintenance and repair costs. Costs in-
with. curred for necessary maintenance, repair, or
(3) Organizations shall maintain adequate upkeep of buildings and equipment (includ-
records to demonstrate that the determina- ing Federal property unless otherwise pro-
tion of costs as being allowable or unallow- vided for) which neither add to the perme-
able pursuant to paragraph 25 complies with vent value of the property nor appreciably
the requirements of this Appendix. prolong its intended life, but keep it in an ef-
(4) Time logs, calendars, or similar records ficient operating condition, are allowable.
shall not be required to be created for pur- Costs incurred for improvements which add
poses of complying with this paragraph dur- to the permanent value of the buildings and
ing any particular calendar month when: the equipment or appreciably prolong their in-
employee engages in lobbying (as defined in tended life shall be treated as capital ex-
subparagraphs 25.a. and b. of this appendix) penditures (see paragraph 15 of this appen-
25 percent or less of the employee's corn- dix),
pensated hours of employment during that 28. Materials and supplies costs. a. Costs
calendar month, and within the preceding incurred for materials, supplies, and fab-
five-year period, the organization has not ricated parts necessary to carry out a Fed-
materially misstated allowable or unallow- eral award are allowable.
able costs of any nature, including legisla- b. Purchased materials and supplies shall
tive lobbying costs. When the conditions de- be charged at their actual prices, net of ap-
scribed in this subparagraph are met,organi-
al
zations are not required to establish records cro stockroomsWit should
from chargedgene at
to support the allowability of claimed costs storestheir or c shouundeld anybe recognized at
in addition to records already required or method actual net g inventoryt hdrawa
maintained. Also, when the conditions de- of pricing withdrawals,
scribed in this subparagraph are met, the ab- consistently applied. Incoming transpor-
sence of time logs, calendars, or similar tation charges are a proper part of materials
records will not serve as a basis for dis-
allowing costs by contesting estimates of c. Only materials and supplies actually
lobbying time spent by employees during a. used for the performance of a Federal award
calendar month. may be charged as direct costs.
(5) Agencies shall establish procedures for d. Where federally-donated or furnished
resolving in advance, in consultation with materials are used in performing the Federal
OMB, any significant questions or disagree- award, such materials will be used without
ments concerning the interpretation or ap- charge.
plication of paragraph 25. Any such advance 29. Meetings and conferences. Costs sE
resolution shall be binding in any subsequent meetings and conferences, the primary pur-
settlements, audits or investigations with pose of which is the dissemination of tech-
respect to that grant or contract for pur- nical information, are allowable. This in-
poses of interpretation of this Appendix; pro- eludes costs of meals, transportation, rental
vided, however, that this shall not be con- of facilities, speakers' fees, and other items
strued to prevent a contractor or grantee incidental to such meetings or conferences.
from contesting the lawfulness of such a de- But see paragraphs 14., Entertainment costs,
termination. and 33., Participant support costs of this ap-
d.Executive lobbying costs. Costs incurred pendix.
in attempting to improperly influence either 30. Memberships, subscriptions, and profes-
directly or indirectly, an employee or officer sional activity costs. a. Costs of the non-
202
OMB Circulars and Guidance Pt. 230, App. B
profit organization's membership in busi- or any United States patent application,
ness, technical, and professional organiza- where the Federal award does not require
tions are allowable. conveying title or a royalty-free license to
b. Costs of the non-profit organization's the Federal Government (but see paragraph
subscriptions to business, professional, and 45., Royalties and other costs for use of pat-
technical periodicals are allowable. ents and copyrights,of this appendix).
c. Costs of membership in any civic or 35. Plant and homeland security costs.
community organization are allowable with Necessary and reasonable expenses incurred
prior approval by Federal cognizant agency. for routine and homeland security to protect
d. Costs of membership in any country club facilities, personnel, and work products are
or social or dining club or organization are allowable. Such costs include, but are not
unallowable. limited to, wages and uniforms of personnel
31. Organization costs. Expenditures, such engaged in security activities; equipment;
as incorporation fees, brokers' fees, fees to barriers; contractual security services; con-
promoters, organizers or management con- sultants; etc. Capital expenditures for home-
sultants, attorneys, accountants, or. invest- land and plant security purposes are subject
ment counselors, whether or not employees to paragraph 15., Equipment and other cap-
of the organization. in connection with es- ital expenditures, of this appendix.
tablishment or reorganization of an organ- 36. Pre-agreement costs, Pre-award costs
zation, are unallowable except with prior ap- are those incurred prior to the effective date
proval of the awarding agency. of the award directly pursuant to the nego-
32. Page charges in professional journals. tiation and in anticipation of the award
Page charges for professional journal publi- where such costs are necessary to comply
cations are allowable as a necessary part of with the proposed delivery schedule or period
research costs,where: of performance. Such costs are allowable
a. The research papers report work sap- only to the extent that they would have been
ported by the Federal Government; and allowable if incurred after the date of the
b. The charges are levied impartially on all award and only with the written approval of
research papers published by the journal, the awarding agency.
whether or not by federally-sponsored au- 37. Professional services costs. a. Costs of
thors. professional and consultant services ren-
33. Participant support costs. Participant dered by persons who are members of a par-
support costs are direct costs for items such ticular profession or possess a special skill,
as stipends or subsistence allowances, travel and who are not officers or employees of the
allowances, and registration fees paid to or non-profit organization, are allowable, sub-
on behalf of participants or trainees(but not ject to subparagraphs b and c when reason-
employees) in connection with meetings, able in relation to the services rendered and
conferences, symposia, or training projects. when not contingent upon recovery of the
These costs are allowable with the prior ap- costs from the Federal Government. In addi-
proval of the awarding agency. tion, legal and related services are limited
34. Patent costs. a. The following costs re- under paragraph 10 of this appendix.
lating to patent and copyright matters are b. In determining the allowability of costs
allowable: cost of preparing disclosures, re- in a particular case, no single factor or any
ports, and other documents required by the special combination of factors is necessarily
Federal award and of searching the art to- determinative. However, the following fac-
the extent necessary to make such disclo- tors are relevant:
sures; cost of preparing documents and any (1) The nature and scope of the service ren-
other patent costs in connection with the fil- dered in relation to the service required,
ing and prosecution of a United States pat- (2) The necessity of contracting for the
ent application where title or royalty-free li- service, considering the non-profit organiza-
cense is required by the Federal Government tion's capability in the particular area.
to be conveyed to the Federal Government; (3) The past pattern of such costs, particu-
and general counseling services relating to larly in the years prior to Federal awards.
patent and copyright matters, such as advice (4) The impact of Federal awards on the
on patent and copyright laws, regulations, non-profit organization's business (i.e., what
clauses, and employee agreements (but see new problems have arisen).
paragraphs 37., Professional services costs, (5) Whether the proportion of Federal work
and 44., Royalties and other costs for use of to the non-profit organization's total busi-
patents and copyrights, of this appendix). ness is such as to influence the non-profit or-
b. The following costs related to patent ganization in favor of incurring the cost,
and copyright matter are unallowable: particularly where the services rendered are
(1) Cost of preparing disclosures, reports, not of a continuing nature and have little re-
and other documents and of searching the lationship to work under Federal grants and
art to the extent necessary to make disclo- contracts.
sures not required by the award. (6) Whether the service can be performed.
(2) Costs in connection with filing and more economically by direct employment
prosecuting any foreign patent application, rather than contracting.
2U2
Pt. 230, App. B 2 CFR Ch. II (1-1-12 Edition)
(7) The qualifications of the individual or b. In publications, costs of help wanted ad-
concern rendering the service and the cus- vertising that includes color, includes adver-
ternary fees charged, especially on non-Fed- tising material for other than recruitment
eral awards. purposes, or is excessive in size (taking into
(8) Adequacy of the contractual agreement consideration recruitment purposes for
for the service (e.g., description of the serv- which intended and normal organizational
ice, estimate of time required, rate of corn- practices in this respect), are unallowable.
pensation,and termination provisions). c. Costs of help wanted advertising, special
c. In addition to the factors in subpara- emoluments, fringe benefits, and salary al-
graph 37.b of this appendix, retainer fees to lowances incurred to attract professional
be allowable must be supported by evidence personnel from other organizations that do
of bona fide services available or rendered not meet the test of reasonableness or do not
38. Publication and printing costs, a.Publi- conform with the established practices of the
cation costs include the costs of printing(in- organization,are unallowable.
eluding the processes of composition, plate- d.Where relocation costs incurred incident
making, press work, binding, and the end to recruitment of a new employee have been
products produced by such processes), dis- allowed either as an allocable direct or indi-
tribution, promotion, mailing, and general rect cost, and the newly hired employee re-
handling. Publication costs also include page signs for reasons within his control within
charges in professional publications, twelve months after being hired, the organi-
b. If these costs are not identifiable with a zation will be required to refund or credit
particular cost objective, they should be al- such relocation costs to the Federal Govern-
located as indirect costs to all benefiting ac- ment.
tivities of the non-profit organization. 42. Relocation costs. a. Relocation costs
c. Page charges for professional journal are costs incident to the permanent change
publications are allowable as a necessary of duty assignment (for an indefinite period
part of research costs where: or for a stated period of not less than 12
(1) The research papers report work sup- months) of an existing employee or upon re-
ported by the Federal Government: and cruitment of a new employee. Relocation
(2) The charges are levied impartially on costs are allowable, subject to the limitation
all research papers published by the journal, described in subparagraphs 42.b, c, and d of
whether or not by federally-sponsored au- this appendix,provided that:
thors. (1) The move is for the benefit of the em-
39. Rearrangement and alteration costs. ployer.
Costs incurred for ordinary or normal rear- (2) Reimbursement to the employee is in
rangement and alteration of facilities are al- accordance with an established written pol-
lowable. Special arrangement and alteration icy consistently followed by the employer.
costs incurred specifically for the project are (3)The reimbursement does not exceed the
allowable with the prior approval of the employee's actual (or reasonably estimated)
awarding agency. expenses.
40. Reconversion costs. Costs incurred in b. Allowable relocation costs for current
the restoration or rehabilitation of the non- employees are limited to the following:
profit organization's facilities to approxi- (1) The costs of transportation of the em-
mately the same condition existing imme- ployee, members of his immediate family
diately prior to commencement of Federal and his household, and personal effects to
awards, less costs related to normal wear the new location.
and tear, are allowable. (2) The costs of finding a new home, such
41. Recruiting costs. a. Subject to subpara- as advance trips by employees and spouses to
graphs 41,b, c, and d of this appendix, and locate living quarters and temporary lodging
provided that the size of the staff recruited during the transition period, up to maximum
and maintained is in keeping with workload period of 30 days, Including advance trip
requirements, costs of "help wanted" adver- time.
tising, operating costs of an employment of- (3) Closing costs, such as brokerage, legal,
fice necessary to secure and maintain an and appraisal fees, incident to the disposi-
adequate staff,costs of operating an aptitude tion of the employee's former home. These
and educational testing program, travel costs, together with those described in sub-
costs of employees while engaged in recruit- paragraph 42.b.(4) of this appendix, are lim-
ing personnel, travel costs of applicants for ited to 8 percent of the sales price of the em-
interviews for prospective employment, and ployee's former home.
relocation costs incurred incident to recruit- (4) The continuing costs of ownership of
ment of new employees, are allowable to the the vacant former home after the settlement
extent that such costs are incurred pursuant or lease date of the employee's new perma-
to a well-managed recruitment program. vent home, such as maintenance of buildings
Where the organization uses employment and grounds (exclusive of fixing up expenses),
agencies, costs that are not in excess of utilities, taxes,and property insurance.
standard commercial rates for such services (5) Other necessary and reasonable ex-
are allowable. penses normally incident to relocation, such
4
Pt. 230, App. B 2 CFR Ch. II (1-1-12 Edition)
However, these costs are allowable as direct below. They are to be used in conjunction
costs, with prior approval by awarding agen- with the other provisions of this appendix in
cies, when they are necessary for the per- termination situations.
formance of Federal programs. a. The cost of items reasonably usable on
46. Specialized service facilities, a. The the non-profit organization's other work
costs of services provided by highly complex shall not be allowable unless the non-profit
or specialized facilities operated by the non- organization submits evidence that it would
profit organization, such as computers, wind not retain such items at cost without sus-
tunnels, and reactors are allowable, provided tanning a loss. In deciding whether such
the charges for the services meet the condi- items are reasonably usable on other work of
tions of either paragraph 46 b. or c. of this the non-profit organization, the awarding
appendix and, in addition, take into account agency should consider the non-profit orga-
any items of income or Federal financing nization's plans and orders for current and
that qualify as applicable credits under sub- scheduled activity. Contemporaneous pur-
paragraph A.5. of Appendix A to this part, chases of common items by the non-profit
b. The costs of such services, when mate- organization shall be regarded as evidence
rial, must be charged directly to applicable that such items are reasonably usable on the
awards based on actual usage of the services non-profit organization's other work. Any
on the basis of a schedule of rates or estab- acceptance of common items as allocable to
lished methodology that does not discrimi- the terminated portion of the Federal award
nate against federally-supported activities of shall be limited to the extent that the quan-
the non-profit organization, including usage titles of such items on hand, in transit, and
by the non-profit organization for internal on order are in excess of the reasonable
purposes, and is designed to recover only the quantitative requirements of other work.
aggregate costs of the services. The costs of b. If in a particular case, despite all rea-
each service shall consist normally of both sonable efforts by the non-profit organiza-
its direct costs and its allocable share of all tion, certain costs cannot be discontinued
indirect costs. Rates shall be adjusted at immediately after the effective date of ter-
least biennially, and shall take into consid- mination, such costs are generally allowable
eration over/under applied costs of the pre- within the limitations set forth in this ap-
vious period(s). pendix, except that any such costs con-
c. Where the costs incurred for a service tinning after termination due to the neg-
are not material, they may be allocated as ligent or willful failure of the non-profit or-
indirect costs. ganization to discontinue such costs shall be
d. Under some extraordinary cir- unallowable.
cumstances, where it is in the best interest c. Loss of useful value of special tooling,
of the Federal Government and the institu- machinery,and is generally allowable if:
tion to establish alternative costing arrange- (1) Such special tooling,special machinery,
ments, such arrangements may be worked or equipment is not reasonably capable of
out with the cognizant Federal agency. use in the other work of the non-profit orga-
47. Taxes. a.In general, taxes which the or- nization,
ganization is required to pay and which are (2)The interest of the Federal Government
paid or accrued in accordance with GAAP, is protected by transfer of title or by other
and payments made to local governments in means deemed appropriate by the awarding
lieu of taxes which are commensurate with agency, and
the local government services received are (3)The loss of useful value for any one ter-
allowable, except for taxes from which ex- minated Federal award is limited to that
emptions are available to the organization portion of the acquisition cost which bears
directly or which are available to the organi- the same ratio to the total acquisition cost
nation based on an exemption afforded the as the terminated portion of the Federal
Federal Government and in the latter case award bears to the entire terminated Federal
when the awarding agency makes available award and other Federal awards for which
the necessary exemption certificates, special the special tooling, special machinery, or
assessments on land which represent capital equipment was acquired.
improvements, and Federal income taxes. d. Rental costs under unexpired leases are
b. Any refund of taxes, and any payment to generally allowable where clearly shown to
the organization of interest thereon, which have been reasonably necessary for the per-
were allowed as award costs, will be credited formance of the terminated Federal award
either as a cost reduction or cash refund, as less the residual value of such leases, if:
appropriate, to the Federal Government. (1)The amount of such rental claimed does
48. Termination costs applicable to spon- not exceed the reasonable use value of the
cored agreements. Termination of awards property leased for the period of the Federal
generally gives rise to the incurrence of award and such further period as may be rea-
costs, or the need for special treatment of sonable,and
costs, which would not have arisen had the (2) The non-profit organization makes all
Federal award not been terminated. Cost reasonable efforts to terminate, assign, set-
principles covering these items are set forth tle, or otherwise reduce the cost of such
206
OMB Circulars and Guidance Pt. 230, App. B
lease, There also may be included the cost of field in which the employee is now working
alterations of such leased property, provided or may reasonably be expected to work, and
such alterations were necessary for the per- are limited to:
formance of the Federal award, and of rea- (1)Training materials.
sonable restoration required by the provi- (2)Textbooks.
sions of the lease. (3)Fees charges by the educational institu-
e. Settlement expenses including the fill- tion.
lowing are generally allowable: (4) Tuition charged by the educational in-
(1) Accounting, legal, clerical, and similar stitution or, in lieu of tuition, instructors'
costs reasonably necessary for: salaries and the related share of indirect
(a) The preparation and presentation to costs of the educational institution to the
the awarding agency of settlement claims extent that the sum thereof is not in excess
and supporting data with respect to the ter- of the tuition which would have been paid to
minated portion of the Federal award, unless the participating educational institution.
the termination is for default (see §215.61 of (5) Salaries and related costs of instructors
2 CFR part 215(OMB Circular A-110));and who are employees of the organization.
(b)The termination and settlement of sub- (6) Straight-time compensation of each
awards. employee for time spent attending classes
(2)Reasonable costs for the storage, trans- during working hours not in excess of 156
portation, protection, and disposition of hours per year and only to the extent that
property provided by the Federal Govern- circumstances do not permit the operation of
went or acquired or produced for the Federal classes or attendance at classes after regular
award, except when grantees or contractors working hours; otherwise, such compensa-
are reimbursed for disposals at a predeter- tion is unallowable.
mined amount in accordance with §215.32 c. Costs of tuition, fees, training materials,
through 215.37 of 2 CFR part 215 (OMB Cir- and textbooks (but not subsistence, salary,
cular A-110). or any other emoluments) in connection
(3) Indirect costs related to salaries and with full-time education, including that pro-
wages incurred as settlement expenses in vided at the organization's own facilities, at
subparagraphs 48.e.(1) and (2) of this appen- a post-graduate (but not undergraduate) col-
dix. Normally, such indirect costs shall be lege level, are allowable only when the
limited to fringe benefits, occupancy cost, course or degree pursued is related to the
and immediate supervision. field in which the employee is now working
f. Claims under sub awards, including the or may reasonably be expected to work, and
allocable portion of claims which are corn- only where the costs receive the prior ap-
mon to the Federal award, and to other work proval of the awarding agency. Such costs
of the non-profit organization are generally are limited to the costs attributable to a
allowable, total period not to exceed one school year for
An appropriate share of the non-profit or- each employee so trained. In unusual cases
ganization's indirect expense may be allo- the period may be extended.
cated to the amount of settlements with sub- d. Costs of attendance of up to 16 weeks per
contractors and/or subgrantees, provided employee per year at specialized programs
that the amount allocated is otherwise con- specifically designed to enhance the effec-
sistent with the basic guidelines contained tiveness of executives or managers or to pre-
in Appendix A. The indirect expense so allo- pare employees for such positions are allow-
cated shall exclude the same and similar able. Such costs include enrollment fees,
costs claimed directly or indirectly as settle- training materials, textbooks and related
ment expenses. charges, employees' salaries, subsistence.
49. Training costs. a. Costs of preparation and travel. Costs allowable under this para-
and maintenance of a program of instruction graph do not include those for courses that
including but not limited to on-the-job, are part of a degree-oriented curriculum,
classroom, and apprenticeship training, de- which are allowable only to the extent set
signed to increase the vocational effective- forth in subparagraphs b and c.
ness of employees, including training mate- e. Maintenance expense, and normal depre-
rials, textbooks, salaries or wages of trainees ciation or fair rental, on facilities owned or
(excluding overtime compensation which leased by the organization for training pur-
might arise therefrom),and(i)salaries of the poses are allowable to the extent set forth in
director of training and staff when the train- paragraphs 11,27, and 50 of this appendix.
ing program is conducted by the organza- f. Contributions or donations to edu-
tion; or (ii) tuition and fees when the train- cational or training institutions, including
ing is in an institution not operated by the the donation of facilities or other properties,
organization, are allowable. and scholarships or fellowships, are unallow-
b. Costs of part-time education, at an un- able.
dergraduate or post-graduate college level, g. Training and education costs in excess
including that provided at the organization's of those otherwise allowable under subpara-
own facilities, are allowable only when the graphs 49.b and c of this appendix may be al-
course or degree pursued is relative to the lowed with prior approval of the awarding
207
Pt. 230, App. C 2 CFR Ch. II (1-1-12 Edition)
agency. To be considered for approval, the transportation savings; or offer accommoda-
organization must demonstrate that such tions not reasonably adequate for the trav-
costs are consistently incurred pursuant to eler's medical needs. The non-profit organi-
an established training and education pro- zation must justify and document these con-
gram, and that the course or degree pursued ditions on a case-by-case basis in order for
is relative to the field in which the employee the use of first-class airfare to be allowable
is now working or may reasonably be ex- in such cases.
pected to work. (2) Unless a pattern of avoidance is de-
50. Transportation costs. Transportation tected, the Federal Government will gen-
costs include freight, express, cartage, and orally not question a non-profit orga.niza-
postage charges relating either to goods pur- tion's determinations that customary stand-
chased, in process, or delivered. These costs and airfare or other discount airfare is un-
are allowable, When such costs can readily available for specific trips if the non-profit
be identified with the items involved, they organization can demonstrate either of the
may be directly charged as transportation following: that such airfare was not avail-
costs or added to the cost of such items (see able in the specific case; or that it is the
paragraph 28 of this appendix). Where identi- non-profit organization's overall practice to
fication with the materials received cannot make routine use of such airfare.
readily be made, transportation costs may be d. Air travel by other than commercial
charged to the appropriate indirect cost ac- carrier. Costs of travel by non-profit organi-
counts if the organization follows a con- zation-owned, -leased, or -chartered aircraft
sistent, equitable procedure in this respect. include the cost of lease, charter, operation
51.Travel costs. (including personnel costs), maintenance, de-
a, General. Travel costs are the expenses preciation, insurance, and other related
for transportation, lodging, subsistence, and costs. The portion of such costs that exceeds
related items incurred by employees who are the cost of allowable commercial air travel,
in travel status on official business of the as provided for in subparagraph] c., is unal-
non-profit organization. Such costs may be lowable.
charged on an actual cost basis, on a per e. Foreign travel. Direct charges for for-
diem or mileage basis in lieu of actual costs
incurred, or on a combination of the two, eign travel costs are allowable only when the
provided the method used is applied to an en- travel has received prior approval of the
tire trip and not to selected days of the trip, awarding agency. Each separate foreign trip
and results in charges consistent with those must receive such approval. For purposes of
normally allowed in like circumstances in this provision, "foreign travel" includes any
the non-profit organization's non-federally- travel outside Canada, Mexico, the United
sponsored activities. States, and any United States territories and
b. Lodging and subsistence. Costs incurred possessions. However, the term "foreign
by employees and officers for travel, includ- travel" for a non-profit organization located
ing costs of lodging, other subsistence, and in .a foreign country means travel outside
incidental expenses, shall be considered rea- that country.
sonable and allowable only to the extent 52. Trustees. Travel and subsistence costs
such costs do not exceed charges normally of trustees (or directors) are allowable. The
allowed by the non-profit organization in its costs are subject to restrictions regarding
regular operations as the result of the non- lodging, subsistence and air travel costs pro-
profit organization's written travel policy. vided in paragraph 51 of this appendix.
In the absence of an acceptable,written non-
profit organization policy regarding travel APPENDIX C TO PART 230—NON-PROFIT
costs, the rates and amounts established ORGANIZATIONS NOT SUBJECT TO
under subchapter I of Chapter 57, Title 5, THIS PART
United States Code ("Travel and Subsistence
Expenses; Mileage Allowances"), or by the 1. Advance Technology Institute (ATI),
Administrator of General Services, or by the Charleston, South Carolina
President (or his or her designee) pursuant 2. Aerospace Corporation, El Segundo, Cali-
to any provisions of such subchapter shall fornia
apply to travel under Federal awards(48 CFR 3. American Institutes of Research (AIR),
31.205-46(a)), Washington DC
c. Commercial air travel. (1) Airfare costs 4. Argonne National Laboratory, Chicago, Il-
in excess of the customary standard commer- linois
cial airfare (coach or equivalent), Federal 5. Atomic Casualty Commission, Wash-
Government contract airfare (where author- ington,DC
ized and available), or the lowest commercial 6_ Battelle Memorial Institute,
discount airfare are unallowable except when Headquartered in Columbus,Ohio
such accommodations would: require circui- 7. Brookhaven National Laboratory. Upton,
tous routing;require travel during unreason- New York
able hours; excessively prolong travel; result 8. Charles Stark Draper Laboratory. Incor-
in additional costs that would offset the porated, Cambridge,Massachusetts
208
OMB Circulars and Guidance Pt. 230, App. C
9. CNA Corporation (CNAC), Alexandria, Vir- 22. Rand Corporation, Santa Monica, Cali-
ginia fornia
10. Environmental Institute of Michigan, 23. Research Triangle Institute, Raise/arch
Ann Arbor, Michigan Triangle Park,North Carolina
11. Georgia Institute of Technology/Georgia 24. Riverside Research Institute, New York,
Tech Applied Research Corporation/Geor- New York
gia Tech Research Institute, Atlanta, 25. South Carolina Research Authority
Georgia (SCRA), Charleston,South Carolina
12. Hanford Environmental Health Founda- 26. Southern Research Institute, Bir-
tion,Richland,Washington mingham,Alabama
13.UT Research Institute, Chicago, Illinois 27. Southwest Research Institute, San Anto-
14. Institute of Gas Technology, Chicago, Il- nio,Texas
linois 28. SRI International,Menlo Park, California
15. Institute for Defense Analysis, Alexan- 29. Syracuse Research Corporation, Syra-
dria,Virginia cuse,New York
16,LMI,McLean,Virginia 30. Universities Research Association, Incor-
17. Mitre Corporation, Bedford, M:sss9atha- porated (National Acceleration Lab), Ar-
setts gonne,Illinois
18. Mitretek Systems, Inc., malls Church, 31. Urban Institute, Washington DC
Virginia 32. Non-profit insurance companies, such as
19. National Radiological Astronomy Observ- Blue Cross and Blue Shield Organizations
atory,Green Bank,West Virginia 33. Other non-profit organizations as nego-
20. National Renewable Energy Laboratory, tiated with awarding agencies
Golden, Colorado
21. Oak Ridge Associated Universities, Oak
Ridge,Tennessee PARTS 231-299 [RESERVED]
9'
EXHIBIT H
24 CFR 85.43 ENFORCEMENT
(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 entitles 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-cancelable, 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.
O
EQUAL
Rev.5/7/08
EXHIBIT ►
OMB Guidance 1200.501
5701-11, ("Travel and Subsistence Ex- Subpart F—Audit Requirements
penses; Mileage Allowances"), or by
the Administrator of General Services, � L
or by the President (or his or her des-
ignee) pursuant to any provisions of §$00•500 impose•
such subchapter must apply to travel This part sets forth standards for ob-
under Federal awards (48 CFR 31.205- taming consistency and uniformity
46(a)). among Federal agencies for the audit
(d) Commercial air travel. (1) Airfare of non-Federal entities expending Fed-
costs in excess of the basic least expen- eral awards.
sive unrestricted accommodations
class offered by commercial airlines Anlorrs
are unallowable except when such ac- 200.601 Audit requirements.
commodations would:
(i)Require circuitous routing; (a)Audit required.A non-Federal enti-
(ii) Require travel during unreason- ty that expends 5750,000 or more during
able hours; the non-Federal entity's fiscal year in
(111)Excessively prolong travel; Federal awards must have a single or
(iv) Result in additional costs that program-specific audit conducted for
would offset the transportation•say- that year in accordance with the provi-
ings; or sions of this part,
(v) Offer accommodations not reason- (b) Single audit. A non-Federal entity
ably adequate for the traveler's mod- that expends $750,000 or more during
ical needs. The non Federal entity the non-Federal entity's fiscal year in
Federal
must justify and document these condi- awardsmust have .a single
Lions on a case-by-case basis in order audit conducted in accordance with
for the use of first-class or business- §200•b14 Scope of audit except when it
class airfare to be allowable in such elects to have a program-specific audit
conducted in accordance with para-
cases. graph(c)of this section.
(2) Unless a pattern of avoidance is
(c) Program-specific audit election,
detected, the Federal government will When an auditee expends Federal
° generally not question a non-Federal awards under only one Federal pro-
entity's determinations that cue- gram (excluding R&D)'and the Federal
ternary standard airfare or other die- program's statutes, regulations, or the
count airfare is unavailable for specific terms and conditions'of the Federal
tripe if the non-Federal entity can award do not require a financial state-
demonstrate that such airfare was not ment audit of the auditee, the auditee
available in the specific case. may elect to have a program-specific
(e) Air travel by other than commercial audit conducted in accordance with
carrier. Costs of travel by non-Federal §200.507 Program-specific audits. A pro-
entity-owned, -leased, or -chartered gram-specific audit may not be elected
aircraft include the cost of lease, char- for R&D unless all of the Federal
ter, operation (including personnel awards expended were received from
costs), maintenance, depreciation, in- the same Federal agency, or the same
surance, and other related costs. The Federal agency and the same pass-
portion of such costs that exceeds the through entity, and that Federal agen-
cost of airfare as provided for in Para- cy, or pass-through entity in the case
graph (d) of this section, is unaliow- of a subreoipient, approves in advance
able. a program-specific audit,
(d) Exemption when Federal awards ex-
§200.475 Trustees. pended are less than $750,000. A non-Fed-
eral entity that expends less than
Travel and subsistence costs of trust- $750,000 during the non-Federal entity's
ees(or directors)at 7HFs and nonprofit fiscal year in Federal awards is exempt
organizations are allowable. See also from Federal audit requirements for
§200.474 Travel costs, that year, except as noted in §200.503
Relation to other audit requirements,
171
§200.502 2 CFR Ch. 11 (1-1-14 Edition)
but records must be available for re- sponsibility. Methods to ensure oomph-
view or audit by appropriate officials ance for Federal awards made to for-
of the Federal agency,pass-through en- profit subrecipients may include pre-
tity, and Government Accountability award audits, monitoring during the
Office(GAO). agreement, and post-award 'audits. See
(e) Federally Funded Research and De- also §200.331 Requirements for pass-
velopment Centers (FFRDC). Manage- through entities.
ment of an auditee that owns or oper-
ates a FFRDC may elect to treat the §200.502 Basis For deterseining p :-
FFEDC as a separate entity for pur- eral awards expend,
poses of this part. (a) Determining Federal awards ex-
(f) Subrecipients and Contractors. An pended. The determination of when a
auditee may simultaneously be a re- Federal award is expended should be
cipient, a- subrecipient, and a con- based on when the activity related to
tractor. Federal awards expended as a the Federal award occurs. Generally,
recipient or a snbreoipient are subject the activity pertains to events that re-
to audit under this part. The payments quire the non-Federal entity to comply
received for geode or services provided with Federal statutes, regulations, and
as a contractor are not Federal awards, the terms and conditions of Federal
Section §200.330 Subrecipient and con- awards, such as: expenditure/expense
tractor determinations should be con- transactions associated with awards in-
sidered in determining whether pay- eluding grants, cost-reimbursement
manta constitute a Federal award or a contracts under the FAR, compacts
payment for goods or services provided with Indian Tribes, cooperative agree-
as a contractor, ments, and direct appropriations; the
(g) Compliance responsibility for con- disbursement of funds to subrecipients;
tractors. In most oases, the auditee's the use of loan proceeds under loan and
compliance responsibility for contrac- loan guarantee programs; the receipt of
tore is only to ensure that the procure- property; the receipt of surplus prop-
ment, receipt, and payment for goods arty; the receipt or use of program in-
and services comply with Federal stat- come; the distribution or use of food
utes, regulations, and the terms and commodities; the disbursement of
conditions of Federal awards. Federal amounts entitling the non-Federal en-
award compliance requirements nor- tity to an interest subsidy; and the pe-
many do not pass through to contrac- riod when insurance is in force.
tors. However, the auditee is respon- (b) Loan and loan guarantees (loans).
Bible for ensuring compliance for pro- Since the Federal government is at
ourement transactions which are strut- risk for loans until the debt is repaid,
tared such that the contractor is re- the following guidelines must be used
sponsible for program compliance or to calculate the value of Federal
the contractor's records must be re- awards expended under loan programs,
viewed to determine program oomph- except as noted in paragraphs (c) and
ance. Also, when these procurement (d) of this section:
transactions relate to a major pro- (1) Value of new loans made or re-
gram, the scope of the audit must in- ceived during the audit period; plus
elude determining whether these trans- (2) Beginning of the audit period bal-
actions are in compliance with Federal ance of loans from previous years for
statutes, regulations, and the terms which the Federal government imposes
and conditions of Federal awards. continuing compliance requirements;
(h) For profit subrecipient. Since this plus
part does not apply to for-profit sub- (3) Any interest subsidy, cash, or ad-
recipients, the pass-through entity is ministrative cost allowance received.
responsible for establishing require- (o) Loan and loan guarantees (loans) at
ments, as necessary, to ensure oomph- IHEs. When loans are made to students
ance by for-profit subrecipients. The of an IHE but the IHE does not make
agreement with the for-profit sub- the loans, then only the value of loans
recipient should describe applicable made during the audit period must be
compliance requirements and the for- considered Federal awards expended in
profit subrecipient's compliance re- that audit period. The balance of loans
172
OMB Guidance §200.503
for previous audit periods is not in- §appbpg Relation to other audit re-
eluded as Federal awards expended be- quirements.
cause the lender accounts for the prior
balances. (a) An audit conducted in accordance
(d) Prior loan and loan guarantees with this part must be in lieu of any fi-
(loans). Loans, the proceeds of which nanaial audit of Federal awards which
were received and expended in prior a non-Federal entity is required to un-
years, are not considered Federal dergo under any other Federal statute
awards expended order this part when or regulation. To the extent that such
the Federal statutes, regulations, and audit provides a Federal agency with
the terms and conditions of Federal the information it requires to carry
awards pertaining to such loans impose out its responsibilities ender Federal
no continuing compliance require- statute or regulation,a Federal agency
meats other than to repay the loans. must rely upon and use that informs-
(e) Endowment funds. The cumulative tion.
balance of Federal awards for endow- (b) Notwithstanding subsection (a), a
went funds that are federally re- Federal agency, Inspectors General, or
striated are considered Federal awards GAO may conduct or arrange for addi-
expended in each audit period in which tional audits which are necessary to
the funds are still restricted. carry out its responsibilities under
(f) Free rent. Free rent received by Federal statute or regulation. The pro-
itself is not considered a Federal award visions of this part do not authorize
expended under this part.However, free any non-Federal entity to constrain, in
rent received as part of a Federal any manner, such Federal agency from
award to carry out a Federal program carrying out or arranging for such ad-
must be included in determining Fed- ditional audits,except that the Federal
eral awards expended and subject to agency must plan such audits to not be
audit under this part, duplicative of other audits of Federal
(g) Valuing non-cash assistance. Fed- awards. Prior to commencing such an
eral non-cash assistance, such as free audit, the Federal agency or pass-
rent, food commodities, donated prop- through entity.must review the FAO
erty, or donated surplus property, must for recent audits submitted by the non-
be valued at fair market value at the Federal entity, and to the extent such
time of receipt or the assessed value audits meet a Federal agency or pass-
provided by the Federal agency. through entity's needs, the Federal
(h) Medicare. Medicare payments to a agency or pass-through entity must
non-Federal entity for providing pa- rely upon and use such audits.Any ad-
tient care services to Medicare-eligible ditional audits must be planned and
individuals are not considered Federal performed in such. a way as to build
awards expended under this part. upon work performed, including the
(i) Medicaid. Medicaid payments to a audit documentation, sampling, and
subrecipient for providing patient care testing already performed, by other
services to Medicaid-eligible individ- auditors•
uals are not considered Federal awards (o) The provisions of this part do not
expended under this part unless a state limit the authority of Federal agencies
requires the funds to be treated as Fed- to conduct, or arrange for the conduct
eral awards expended because ream- of, audits and evaluations of Federal
bursement is on a cost-reimbursement awards, nor limit the authority of any
basis. Federal agency Inspector General or
(i) Certain loans provided by the Na- other Federal official. For example, re-
tional Credit Union Administration. For quirements that may be applicable
purposes of this part, loans made from under the FAR or CAS and the terms
the National Credit Union Share Insur- and conditions of a cost-reimbursement
anee Fund and the Central Liquidity contract may include additional appli-
Facility that are funded by contribu- cable audits to be conducted or ar-
tions from insured non-Federal entities ranged for by Federal agencies.
are not considered Federal awards ex- (d) Federal agency to pay for addi-
pended. tional audits. A Federal agency that
173
§200.504 2 CFR Ch.Il (I-1-14 Edition)
conducts or arranges for additional au- go its audits pursuant to this part bi-
dits must, consistent with other appli- ennially.
cable Federal statutes and regulations,
arrange for funding the full cost of §200.505 Sanctions.
such additional audits. In oases of continued inability or un-
(e) Request for a program to be au- willingness to have an audit conducted
dited as a major program. A Federal in aocordanoe with this part, Federal
awarding agency may request that an
Federal pro- agencies and pass-through entities.
auditee have a particular
pro-
gram audited as a major program in must take appropriate action for non-
lieu of the Federal awarding agency compliance.
in §200.338 Remedies conducting or arrangingcompliance.
addi-
tional audits. To ala for plthe such requests should be made at�least §200.606 Audit coots,
180 calendar days prior to the end of See§200.425 Audit services.
the fiscal year to be audited. The
auditee, after consultation with its §200'S07SY'�'epecific audits.
auditor, should promptly respond to (a) Program-specific audit guide avail-
such a request by informing the Fed- able, In many oases, a program-specific
eral awarding agency whether the pro- audit guide will be available to provide
gram would otherwise be audited as a specific guidance to the auditor with
major program rising the risk-based respect to internal controls, oomph-
audit approach described in §200.518 ance requirements, suggested audit
Major program determination and, if procedures, and audit reporting re-
not, the estimated incremental cost, quirements. A listing of current pro-
The Federal awarding agency must gram-specific audit guides can be found
then promptly confirm to the auditee in the compliance supplement begin-
whether it wants the program audited ning with the 2014 supplement includ-
as a major program, If the program is ing Federal awarding agency contact
to be audited as a major program based information and a Web site where a
upon this Federal awarding agency re- copy of the guide can be obtained.
quest, and the Federal awarding seen- When a current program-specific audit
cy agrees to pay the full incremental guide is available, the auditor must
costs, then the auditee must have the follow GAGAS and the guide when per-
program audited as a major program. A forming a program-specific audit.
pass-through entity may use the provi- (b) Program-specific audit guide not
stone of this paragraph for a sub- available. (1) When a program-specific
recipient. audit guide is not available, the
§200.504 auditee and auditor must have bast-
Frequency of audits. tally the same responsibilities for the
Except for the provisions for biennial Federal program as they would have
audits provided in paragraphs (a) and for an audit of a major program in a
(b) of this section, audits required by single audit.
this part must be performed annually. (2) The auditee must prepare the fi-
Any biennial audit must cover both nanoial statement(s) for the Federal
years within the biennial period. program that includes, at a minimum,
(a) A state, local government, or In- a schedule of expenditures of Federal
dian tribe that is required by conetitu- awards for the program and notes that
tion or statute, in effect on January 1, describe the significant accounting
1987, to undergo its audits less fre- policies used in preparing the schedule,
quently than annually, is permitted to a summary schedule of prior audit find-
undergo its audits pursuant to this inn consistent with the requirements
part biennially. This requirement must of §200.511 Audit findings follow-up,
still be in effect for the biennial period., paragraph (b), and a corrective action
(b) Any nonprofit organization that plan consistent with the requirements
had biennial audits for all biennial pe- of §200.511 Audit findings follow-up,
riods ending between July 1, 1992, and paragraph(o).
January 1, 1995, is permitted to under- (3) The auditor must:
174
OMB Guidance §200.507
(i) Perform an audit of the financial material effect on tna Federal pre-
statement(s) for the Federal program gram;and
in aocordance with GAGAS; (iv) A schedule of findings and ques-
(11) Obtain an understanding of inter- tioned oasts for the Federal program
nal controls and perform tests of inter- that includes a summary of the aadi-
nal controls over the Federal program tor's results relative to the Federal
consistent with the requirements of program in a format consistent with
§200.514 Scope of audit, paragraph (c) §200.515 Audit reporting, paragraph
for a major program; (d)(1)and findings and questioned costs
(iii)Perform procedures to determine consistent with the requirements of
whether the auditee has complied with §200.515 Audit reporting, paragraph
Federal statutes, regulations, and the (d)(3).
terms and conditions of Federal awards (c) Report submission for program-spe-
that could have a direct and material cifia audits. (1) The audit must be corn-
effect on the Federal program con- pleted and the reporting required by
sistent with the requirements of paragraph (c)(2) or (c)(3) of this section
§200.514 Scope of audit, paragraph (d) submitted within the earlier of 30 cal-
for a major program;. endar days after receipt of the audi-
(iv) Follow up on prior audit findings, tor's report(s), or nine months after
perform procedures to assess the rea- the end of the audit period, unless a
sonableness of the summary schedule different period is specified in a pro-
of prior audit findings prepared by the gram-specific audit guide. Unless re-
auditee in accordance with the require- striated by Federal law or regulation,
ments of§200.511 Audit findings follow- the auditee must make report copies
up, and report, as a current year audit available for public inspection.
finding, when the auditor concludes Auditees and auditors must ensure
that the summary schedule of prior that their respective parts of the re-
audit findings materially misrepre- porting package do not include pre-
sents the status of any prior audit find- tooted personally identifiable informs-
ing;and tion.
(v) Report any audit findings con- (2) When a program-specific audit
sistent with the requirements of guide is available, the auditee must
§200.516 Audit findings. electronically submit to the FAC the
(4) The auditor's report(s) may be in data collection form prepared in ac-
the form of either combined or sepa- cordance with §200.512 Report submis-
rate reports and may be organized dif- sion, paragraph (b), as applicable to a
ferently from the manner presented in program-specific audit, and the report-
this section. The auditor's report(s) ing required by the program-specific
must state that the audit was con- audit guide.
ducted in accordance with this part (3) When a program-specific audit
and include the following: guide is not available, the reporting
(i) An opinion (or disclaimer of opin- package for a program-specific audit
ion) as to whether the financial state- must consist of the financial state-
ment(s) of the Federal program is pre- ment(s) of the Federal program, a sum-
sented fairly in all material respects in mary schedule of prior audit findings,
accordance with the stated accounting and a. corrective action plan as de-
policies; scribed in paragraph (b)(2) of this sec-
(ii) A report on internal control re- tion, and the auditor's report(s)' Be-
lated to the Federal program, which soribed in paragraph (b)(4) of this sec-
must describe the scope of testing of tion.The data collection form prepared
internal control and the results of the in accordance with§200.512 Report sub-
tests; mission,paragraph (b), as applicable to
(iii)A report on compliance which in- a program-specific audit, and one copy
eludes an opinion (or disclaimer of of this reporting package must be elec-
opinion) as to whether the auditee tronically submitted to the FAC.
complied with laws, regulations, and (d) Other sections of this part may
the terms and conditions of Federal apply. Program-specific audits are sub-
awards which could have a direct and jest to:
175
§200.508 2 CFR Ch. II (1-1-14 Edition)
(1) 200.500 Purpose through 200.503 Re- Subpart D- Post Federal Award Re-
lation to other audit requirements, quirements of this part or the FAR (48
Paragraph (d); CFR part 42), as applicable. When pro-
(2) 200.504 Frequency of audits curing audit services, the objective is
through 200.506 Audit costs; to obtain high-quality audits. In re-
(3) 200.508 Auditee responsibilities questing proposals for audit services,
through 200.509 Auditor selection; the objectives and scope of the audit
(4)200.511 Audit findings follow-up; must be made clear and the non-Fed-
(5) 200.512 Report submission, para- eral entity must request a copy of the
graphs (e) through(h); audit organization's peer review report
(6)200.513 Responsibilities; which the auditor is required to pro-
(7) 200.516 Audit findings through vide under GALAS. Factors to be con-
200.517 Audit documentation; sidered in evaluating each proposal for
(B)200.521 Management decision, and audit services include the responsive-
(9)Other referenced provisions of this ness to the request for proposal, rel-
part unless contrary to the provisions evant experience, availability of staff
of this section, a program-specific with professional qualifications and
audit guide, or program statutes and technical abilities, the results of peer
regulations. and external quality control reviews,
and price. Whenever possible, the
rg auditee must make positive efforts to
§500.608 Auditee responRih;lities, utilize small businesses, minority-
owned firms, and women's business en-
The auditee must: terprises, in procuring audit services as
(a) Procure or otherwise arrange for stated in §200.321 Contracting with
the audit required by this part in ac- small and minority businesses, wom-
oordanoe with §200.509 Auditor selec- en's business enterprises, and labor
tion, and ensure it is properly per- surplus area firms, or the FAR(48 CFR
formed and submitted when due in ac- part 42),as applicable.
eordance with §200.512 Report Qubmis- (b) Restriction on auditor preparing in-
sion. direct cost proposals. An auditor who
(b) Prepare appropriate financial prepares the indirect cost proposal or
statements, including the schedule of cost allocation plan may not also be se-
expenditures of Federal awards in ac- looted to perform the audit required by
oordance with §200.510 Financial state- this part when the indirect costs recov-
merits. ered by the auditee during the prior
(c) Promptly follow up and take oor- year exceeded $1 million. This restric-
reotive action on audit findings, in- tion applies to the base year used in
eluding preparation of a summary the preparation of the indirect cost
schedule of prior audit findings and a proposal or cost allocation plan and
corrective action plan in accordance any subsequent years in which the re-
with §200.511 Audit findings follow-up, suiting indirect cost agreement dr cost
paragraph (b) and §200.511 Audit find- allocation plan is used to recover costs.
ings follow-up, paragraph (c), respeo- (o) Use of Federal auditors. Federal
tively. auditors may perform all or part of the
(d)Provide the auditor with access to work required under this part if they
personnel, accounts, books, records, comply fully with the requirements of
supporting documentation, and other this part.
information as needed for the auditor
to perform the audit required by this §200.510 Financial statements.
part. (a) Financial statements. The auditee
$200.609 Auditor selection. reflect
prepare financial statements that
(a) Auditor reflect its financial position, results of
procurement. In procuring operations or changes in net assets,
audit services, the auditee must follow and, where appropriate, cash flows for
the procurement standards prescribed the fiscal year audited. The financial
by the Procurement Standards in statements must be for the same orga-
§§200.317 Procurement by states nizational unit and fiscal year that is
through 20.326 Contract provisions of chosen to meet the requirements of
(75
OMB Guidance §200.511
this part. However, non-Federal entity- the schedule the balances outstanding
wide financial statements may also in- at the end of the audit period. This is
elude departments, agencies, and other in addition to including the total Fed-
organisational units that have separate oral awards expended for loan or loan
audits in accordance with §200.514 guarantee programs in the schedule.
Scope of audit, paragraph (a) and pre- (6) Include notes that describe that
pare separate financial statements. significant accounting policies used in
(b) Schedule of expenditures of Federal preparing the schedule, and note
awards. The auditee must also prepare whether or not the non-Federal entity
a schedule of expenditures of Federal elected to use the 10% de minimis oust
awards for the period covered by the rate as covered in §200.414 Indirect
au.ditee's financial statements which (F&A)costs.
must include the total Federal awards §200.1s11 Audit follow-up.
expended as determined in accordance s
with §200.502 Basis for determining (a)General.The auditee is responsible
Federal awards expended. While not re- for follow-up and corrective action on
quired, the auditee may choose to pro- all audit findings. As part of this re-
vide information requested by Federal sponsibility, the auditee must prepare
awarding agencies and pass-through a summary schedule of prior audit find-
entities to make the schedule easier to ings: The auditee must also prepare a
use. For example, when a Federal pro- corrective action plan for current year
gram has multiple Federal award audit findings. The summary schedule
years, the auditee may list the amount of prior audit findings and the correc-
of Federal awards expended for each tive action plan must include the ref-
Federal award year separately. At a erence numbers the auditor assigns to
minimum, the schedule must: audit findings under §200.516 Audit
(1) List individual Federal programs findings, paragraph (c). Since the sum-
by Federal agency. For a cluster of pro- mary schedule may include audit find-
grams, provide the cluster name, list ings from multiple years, it must in-
individual Federal "programs within the elude the fiscal year in which the find-
cluster of programs, and provide the ing initiajjy occurred. The corrective
applicable Federal agency name. For action plan and summary schedule of
R&D, total Federal awards expended prior audit findings must include find-
must be shown either by individual ings relating to the financial state-
Federal award or by Federal agency manta which are required to be re-
and major subdivision within the Fed- ported in accordance with GAGAS.
eral agency. For example, the National (b) Summary schedule of prior audit
Institutes of Health is a major subdivi- findings. The summary schedule of
sion in the Department of Health and prior audit findings must report the
Human Services. status of all audit findings included in
(2) For Federal awards received as a the prior audit's schedule of findings
subrecipient, the name of the pass- and questioned costs. The summary
through entity and identifying number schedule must also include audit find-
assigned by the pass-through entity ings reported in the prior audit's sum-
must be included. mary schedule of prior audit findings
(3) Provide total Federal awards ex- except audit findings listed as cor-
pended for each individual Federal pro- rested in accordance with paragraph
gram. and the CFDA number or other (b)(1) of this section, or no longer valid
identifying number when the CFDA in- or not warranting further action in ao-
formation is not available. For a clue- cordanee with paragraph (b)(9) of this
ter of programs also provide the total section.
for the cluster. (1) When audit findings were fully
(4)Include the total amount provided corrected, the summary schedule need
to snbrecipients from each Federal pro- only list the audit findings and state
gram. that corrective action was taken.
(5) For loan or loan guarantee pro- (2) When audit findings were not cor-
grams described in §200.502 Basis for rooted or were only partially corrected,
determining Federal awards expended, the summary schedule must describe
paragraph (b), identify in the notes to the reasons for the finding's recurrence
177
§200.512 2 CFR Ch. 11 (1-1-14 Edition)
and planned corrective action, and any make copies available for public in-
partial corrective action taken. When speation. Auditees and auditors must
corrective action taken is significantly ensure that their respeotive parts of
different from corrective action pre- the reporting package do not include
viously reported in a corrective action protected personally identifiable infor-
plan or in the Federal agency's or pass- mation.
through entity's management decision, (b)Data Collection. The FAC is the re-
the summary schedule must provide an pository of record for Subpart F—Audit
explanation. Requirements of this part reporting
(3) When the auditee believes the packages and the data collection form.
audit findings are no longer valid or do All Federal agencies, pass-through en-
not warrant further action, the reasons titles and others interested in a report-
for this position must be described in ing package and data collection form
the summary schedule. A valid reason must obtain it by accessing the FAC.
for considering an audit finding as not (1)The auditee must submit required
warranting further action is that all of data elements described in Appendix X
the following have occurred: to Part 200—Data Collection. Form
(I) Two years have passed since the (Form SF-SAC), which state whether
audit report in which the finding oo- the audit was completed in accordance
curred was submitted to the FAC; with this part and provides informa-
(ii) The Federal agency or pass- tion about the auditee, its Federal pro-
through entity is not currently fol- grams, and the results of the audit.
lowing up with the auditee on the audit The data must include information
finding;and available from the audit required by
(iii) A management decision was not this part that is necessary for Federal
issued. agencies to use the audit to ensure in-
(c) Corrective action plan. At the corn- tegrity for Federal programs. The data
pletion of the audit, the auditee must elements and format must be approved
prepare, in a document separate from by OMB, available from the FAC, and
the auditor's findings described in include collections of information from
§200.516 Audit findings, a corrective ac- the reporting package described in
tion plan to address each audit finding paragraph (c) of this section. A senior
included in the current year auditor's level representative of the auditee
reports. The corrective action plan (e.g., state controller, director of fi-
must provide the name(s) of the con- nanee, chief executive officer, or chief
tact person(s) responsible for correc- financial officer) must sign a state-
tive action, the corrective action ment to be included as part of the data
planned, and the anticipated comple- collection that says that the auditee
tion date. If the auditee does not agree complied with the requirements of this
with the audit findings or believes cor- part, the data were prepared in accord-
rective action is not required, then the ance with this part (and the instruc-
corrective action plan must include an tons accompanying the form), the re-
explanation and specific reasons. porting package does not include pro-
tected personally identifiable inforrna-
§200.512 Report submission. tion, the information included in its
(a) General. (1) The audit must be entirety is accurate and complete, and
completed and the data collection form that the FAC is authorized to make the
described in paragraph (b) of this.see- reporting package and the form pub-
tion and reporting package described in Holy available on a Web site.
paragraph (a) of this section must be (2) Exception for Indian Tribes. An
submitted within the earlier of 30 cal- auditee that is an Indian tribe may opt
ender days after receipt of the audi- not to authorize the FAC to make the
tor's report(s), or nine months after reporting package publicly available
the end of the audit period. If the due on a Web site, by excluding the author-
date falls on a Saturday, Sunday, or ization for the FAC publication in the
Federal holiday, the reporting package statement described in paragraph (b)(1)
is due the next business day. of this section. If this option is exer-
(2) Unless restricted by Federal stat- cised, the auditee becomes responsible
u.tes or regulations, the auditee must for submitting the reporting package
178
OMB Guidance §200.513
directly to any pass-through entities graph (b) of this section and one copy
through which it has received a Fed- of the reporting package described in
eral award and to pass-through entities paragraph (c) of this section on file for
for which the summary schedule of three years from the date of submis-
prior audit findings reported the status sion to the FAC.
of any findings related to Federal (g)FAC responsibilities. The FAC must
awards that the pass-through entity make available the reporting packages
provided. Unless restricted by Federal received in accordance with paragraph
statute or regulation, if the auditee (c) of this section and §200.507 Pro-
opts not to authorize publication, it gram-specific audits, paragraph (a) to
must make 'copies of the reporting the public, except for Indian tribes ex-
package available for public inspec- Braising the option in (b)(2) of this sec-
tion. tion, and maintain a data base of corn-
(3) Using the information included in pleted audits, provide appropriate in-
the reporting package described in formation to Federal agencies, and fol-
paragraph (o) of this section, the audi- low up with known auditees that have
tor must complete the applicable data not submitted the required data collec-
elements of the data collection form. tion forms and reporting packages.
The auditor must sign a statement to (h) Electronic filing. Nothing in this
be included as part of the data collet- part must preclude electronic submis-
tion form that indicates, at a min- sion to the FAC in such manner as
inium, the source of the information may be approved by OMB.
included in the form, the auditor's re-
sponsibility for the information, that FEDERAL AGENCIES
the form is not a substitute for the re- ¢$00.618 Responsibilities.
porting package described in paragraph
(a) of this section, and that the content (a)(1) Cognizant agency for audit re
of the form is limited to the collection sponsibilities. A non-Federal entity ex-
of information prescribed by OMB. pending more than$50 million a year in
(a) Reporting package. The reporting Federal awards must have a cognizant
package must include the: agency for audit. The designated cog-
(1) Financial statements and ached- nizant agency for audit must be the
ule of expenditures of Federal awards Federal awarding agency that provides
discussed in §200.510 Financial state- the predominant amount of direct
manta, paragraphs (a) and (b), respec- funding to a non-Federal entity unless
tively; OMB designates a specific cognizant
(2) Summary schedule of prior audit agency for audit.
findings discussed in §200.511 Audit (2) To provide for continuity of cog-
findings follow-up,paragraph(b); nizance, the determination of the pre-
(3) Auditor's report(s) discussed in dominant amount of direct funding
§200.515 Audit reporting; and must be based upon direct Federal
(4) Corrective action plan discussed awards expended in the non-Federal en-
in §200.511 Audit findings follow-up, tity's fiscal years ending in 2009, 2014,
paragraph (o), 2019 and every fifth year thereafter.
(d) Submission to FAC. The auditee For example, audit cognizance for peri-
must electronically submit to the FAC ods ending in 20ll through 2016 will be
the data collection form described in determined based on Federal awards
paragraph (b) of this section and the expended in 2009.
reporting package described in para- (3) Notwithstanding the manner in
graph(c)of this section. which audit cognizance is determined,
(e) Requests for management letters a Federal awarding agency with cog-
issued by the auditor. In response to re- nizance for an auditee may reassign
quests by a Federal agency or pass- cognizance to another Federal award-
through entity, auditees must submit a ing agency that provides substantial
copy of any management letters issued funding and agrees to be the cognizant
by the auditor. agency for audit. Within 80 calendar
(f) Report retention requirements. days after any reassignment, both the
Auditees must keep one copy of the old and the new cognizant agency for
data collection form described in para- audit must provide notice of the
179
§200.513 2 CFR Ch. II (1-1-14 Edition)
change to the FAC, the auditee, and, if standard performanoe by auditors must
known, the auditor. The cognizant be referred to appropriate state lioens-
agency for audit must: ing agencies and professional bodies for
(i)Provide technical audit advice and disciplinary action.
liaison assistance to auditees and audi- (vi) Coordinate, to the extent prao-
tors. tscal, audits or reviews made by or for
(ii) Obtain or conduct quality control Federal agencies that are in addition
reviews on selected audits made by to the audits made pursuant to this
non-Federal auditors, and provide the part, so that the additional audits or
results to other interested organize- reviews build upon rather than dupli-
tions.Cooperate and provide support to sate audits performed in accordance
the Federal agency designated by OMB with this part.
to lead a governmentwide project to (vii) Coordinate a management deci-
determine the quality of single audits sion for cross-cutting audit findings(as
by providing a statistically reliable es- defined in §200,30 .Cross-cutting audit
timate of the extent that single audits finding) that affect the Federal pro-
conform to applicable requirements, grams of more tlla.n one
standards, and procedures; and to make agency when
recommendations to address noted requested by any Federal awarding
agency whose awards are included in
audit quality issues, including rec-
ommendations for any frames to ap. the audit finding of the auditee.
plicable requirements, standards and (viii) Coordinate the audit work and
procedures indicated by the results of reporting reeponsibilitles among audi-
the project. This governmentwide audit to to achieve the most cost-effective
quality project must be performed once audit.
every 6 years beginning in 2018 or at (ix) Provide advice to auditees as to
such other interval as determined by how to handle changes in fiscal years.
OMB, and the results must be public. (b) Oversight agency for audit re-
(iii) Promptly inform other affected sponsibilities. An auditee who doss not
Federal agencies and appropriate Fed- have a designated cognizant agency for
eral law enforcement officials of any audit will be under the general over-
direct reporting by the auditee or its sight of the Federal agency determined
auditor required by SAGAS or statutes in accordance with §200.73 Oversight
and regulations. agency for audit. A Federal agency
(iv) Advise the community of inde- with oversight for an auditee may reas-
pendent auditors of any noteworthy or sign oversight to another Federal agen-
important factual trends related to the oy that agrees to be the oversight
quality of audits stemming from qual- agency for audit. Within 30 calendar
ity control reviews. Significant prob- days after any reassignment, both the
lems or quality issues consistently old and the new oversight agency for
identified through quality control re- audit must provide notice of the
views of audit reports must be referred change to the FAC, the auditee, and, if
to appropriate state licensing agencies known, the auditor. The oversight
and professional bodies. agency for audit:
(v) Advise the auditor, Federal (1) Must provide technical advice to
awarding agencies, and, where appro- auditees and auditors as requested,
priate, the auditee of any deficiencies (2) May assume all or some of the re-
found in the audits when the defi- sponsibilities normally performed by a
cieneies require corrective action by cognizant agency for audit.
the auditor. When advised of deft- (c) Federal awarding agency respon-
ciencies, the auditee must work with sibilities.The Federal awarding agency
the auditor to take corrective action, must perform the following for the
If corrective action is not taken, the Federal awards it makes (See also the
cognizant agency for audit must notify requirements of §20)0.210 Information
the auditor, the auditee, and applicable contained in a Federal award):
Federal awarding agencies and pass- (1) Ensure that audits are completed
through entities of the facts and make and reports are received in a timely
recommendations for follow-up action, manner and in accordance with the re-
Major inadequacies or repetitive sub- quirements of this part.
180.
OMB Guidance §200.514
(2) Provide technical advice and for the single audit process both within
counsel to auditees and auditors as re- and outside the Federal government.
quested. (ii) Promote interagency coordina-
(3) Follow-up on audit findings to en.- tion, consistency, and sharing in areas
sure that the reolpient takes appro- such as coordinating audit follow-up;
priate and timely corrective action. As identifying higher-risk non-Federal en-
part of audit follow-up, the Federal titles; providing input on single audit
awarding agency must: and follow-up policy; enhancing the
(1) Issue a management decision as utility of the FAO; and studying ways
prescribed in §200.521 Management de- to use single audit results to improve
oision; Federal award accountability and best
(ii) Monitor the recipient taking ap- practices.
propriate and timely oorreotive action; (iii) Oversee training for the Federal
(iii) Use cooperative audit resolution awarding agency's program manage-
mechanisms (see §200.25 Cooperative ment personnel related to the single
audit resolution) to improve Federal audit process.
program outcomes through better (iv) Promote the Federal awarding
audit resolution, follow-up, and comic- agency's use of cooperative audit reac-
tive action; and lution mechanisms.
(iv) Develop a, baseline, metrics, and (v) Coordinate the Federal awarding
targets to track, over time, the effec- agency's activities to ensure appro-
tiveness of the Federal agency's prop- priate and timely follow-up and correc-
ess to follow-up on audit findings and tive action on audit findings.
on the effectiveness of Single Audits in (v1) Organize the Federal cognizant
improving non-Federal entity account- agency for audit's follow-up on cross-
ability and their use by Federal award- cutting audit findings that affect the
ing agencies in making award deal- Federal programs' of more than one
sions. Federal awarding agency.
(4) Provide OMB annual updates to (vii) Ensure the Federal awarding
the compliance supplement and work agency provides annual updates of the
with OMB to ensure that the compli- oomplianoe supplement to 0MB.
ance supplement focuses the auditor to (viii) Support the Federal awarding
test the compliance requirements most agency's single audit accountable cffi-
likely to cause improper payments, clays mission.
fraud, waste, abuse or generate audit
finding for which the Federal awarding ApPfiTDBB
agency will take sanctions. §2U0.814 Scopeof audit.
(5) Provide OMB with the name of a
single audit accountable official from (a) General. The audit must be con-
among the senior policy officials of the ducted in accordance with GAGAS. The
Federal awarding agency who must be: audit must cover the entire operations
(i) Responsible for ensuring that the of the auditee, or, at the option of the
agency fulfills all the requirement of auditee, such audit must include a se-
§200.513 Responsibilities and effectively ries of audits that cover departments,
uses the single audit process to reduce agencies, and other organizational
Improper payments and improve Fed- units that expended or otherwise ad-
oral program outcomes. ministered Federal awards during such
(ii) Held accountable to improve the audit period, provided that each such
effectiveness of the single audit process audit must encompass the financial
based upon metrics as described in statements and schedule of expendi-
paragraph (c)(3)(iv)of this section. tures of Federal awards for each such
(iii) Responsible for designating the department, agency, and other organi-
Federal agency's key management sin- zational unit, which must be consid-
gle audit liaison. ered to be a non-Federal entity. The fi-
(8) Provide OMB with the name of a uncial statements and schedule of ex-
key management single audit liaison penditures of Federal awards must be
who must: for the same audit period.
(I) Serve as the Federal awarding (b) Financial statements. The auditor
agency's management point of contact must determine whether the financial
11
§200.515 2 CFR Ch. II (1-1-14 Edition)
statements of the auditee are presented bons of Federal awards that may have
fairly in all material respects in ac- a direct and material effect on each of
cordance with generally accepted so- its major programs.
oounting principles. The auditor must (2) The principal compliance require-
also determine whether the schedule of ments applicable to most Federal pro-
expenditures of Federal awards is stat- grams and the compliance require-
ed fairly in all material respects in re- manta of the largest Federal programs
lation to the auditee's financial state- are included in the compliance supple-
ments as a whole. ment.
(c) Internal control. (i) The compli- (3) For the compliance requirements
once supplement provides guidance on related to Federal programs contained
internal controls over Federal pro- in the compliance supplement,an audit
grams based upon the guidance in of these compliance requirements will
Standards for Internal Control in the meet the requirements of this part.
Federal Government issued by the Where there have been changes to the
Comptroller General of the United compliance requirements and the
States and the Internal Control—Inte- changes are not reflected in the com-
grated Framework, issued by the Corn- plienae supplement, the auditor must
mittee of Sponsoring Orgaltizations of determine the current compliance re-
the Treadway Commission (0080). quirements and modify the audit proce-
(2) In addition to the requirements of dares accordingly. For those Federal
GAGAS, the auditor must perform pro- programs not covered in the compli-
cedures to obtain an understanding of anoe supplement, the auditor should
internal control over Federal programs follow the compliance supplement's
sufficient to plan the audit to support guidance for programs not included in
a low assessed level of control risk of the supplement.
noncomplianoe for major programs.
(3) Except as provided in paragraph (4) The compliance testing must in-
(c)(4) of this section, the auditor must: elude tests of transactions and such
(i) Plan the testing of internal con- other auditing procedures necessary to
trol over compliance for major pro-
provide the auditor sufficient appro-
grams to support a low assessed level priate audit evidence to support an
of control risk for the assertions rel- opinion on compliance.
event to the complianceherequirements (e) Audit follow-up. The auditor must
for each.major program;and fallow-up on prior audit findings, per-
(ii) Perform testing of internal con- f° procedures to assess the reason-
trol as planned in paragraph (c)(3)(i) of soleness of the summary schedule of
•
this section. prior audit findings prepared by the
(4) When internal control over some auditee in aaaordanoe with §200.511
or all of the compliance requirements Audit findings follow-up paragraph (b),
for a major program are likely to be in-
finding,report, as a current year audit
effective in preventing or detecting finding, when the auditor concludes
noncompliance, the planning and per_ that the summary schedule of prior
farming of testing described in Para- audit findings of any
ally audit find-
graph (c)(3) of this section are not re- scuts the status any prior quired for those compliance require-
follow-up The auditor must perform audit
ments. However, the auditor must re-
whether procedures regardless of
port a significant deficiency or mate- Whether a prior audit finding relates to
rial weakness in accordance with a major program in the current year.
§200.516 Audit findings, assess the re- (f) Data Collection Form. As required
lated control risk at the maximum, in §200.512 Report submission para-
and consider whether additional corn- graph(b)(3), the auditor must complete
pliance tests are required because of and sign specified sections of the data
ineffective internal control, collection form.
(d) Compliance. (1) In addition to the §200.61b Audit reporting.
requirements of GAGAS, the auditor
must determine whether the auditee The auditor's report(s) may be in the
has complied with Federal statutes, form of either combined or separate re-
regulations, and the terms and condi- ports and may be organized differently
OMB Guidance §200.515
from the manner presented in this sec- (iii) A statement as to whether the
tion. The auditor's report(s)must state audit disclosed any noncompliance
that the audit was conducted in ac- that is material to the financial state-
cordance with this part and include the ments of the auditee;
following: (iv) Where applicable, a statement
(a) An opinion(or disclaimer of opin- about whether significant deficiencies
ion) as to whether the financial state- or material weaknesses in internal con-
ments are presented fairly in all mate- trol over major programs were dis-
rial respects in accordance with gen- closed by the audit;
orally accepted aoeounting principles (v) The type of report the auditor
and an opinion (or disclaimer of opin- issued on compliance for major pro-
ion) as to whether the schedule of ex- grams (i.e., unmodified opinion, quail-
penditures of Federal awards is fairly fled opinion, adverse opinion, or dis-
stated in all material respects in rela- claimer of opinion);
tion to the financial statements as a (vi) A statement as to whether the
whole. audit disclosed any audit findings that
(b) A report on internal control over the auditor is required to report under
financial reporting and compliance §200.516 Audit findings paragraph(a);
with Federal statutes, regulations, and (vii) An identification of major pro-
the terms and conditions of the Federal grams by listing each individual major
award, noncompliance with which program; however in the case of a clue-
could have a material effect on the fi- ter of programs only the cluster name
nanatal statements. This report must as shown on the Schedule of Expendi-
desoribe the scope of testing of internal tures of Federal Awards is required;
control and compliance and the results (viii) The dollar threshold wed to
of the testa, and, where applicable, it distinguish between Type A and Type B
will refer to the separate schedule of programs, as described in §200.518
findings and questioned costs described Major program determination para.-
in paragraph(d)of this section. graph (b)(1),or (b)(3) when a recalcula-
(c) A report on compliance for each tion of the Type A threshold is re-
major program and report and internal
control over compliance. This report quired for large loan or loan gaaran-
must describe the scope of testing of tees; and
internal control over compliance, in (ix) A statement as to whether the
elude an opinion or modified opinion as auditee qualified as a low-risk auditee
to whether the auditee complied with under §200.520 Criteria for a low-risk
Federal statutes, regulations, and the auditee.
terms and conditions of Federal awards (2) Findings relating to the financial
which could have a direct and material statements which are required to be re-
effect on each major program and refer ported in accordance with GAGAS.
to the separate schedule of findings and (3) Findings and questioned costs for
questioned costs described in pare- Federal 'awards which must include
graph(d)of this section. audit findings as defined in §200.516
(d) A schedule of findings and vas- Audit findings, paragraph(a).
tinned costs which must include the (1) Audit findings (e.g., internal con-
following three components: trol findings, compliance findings,
(1) A summary of the auditor's re- questioned costs, or fraud) that relate
sults, which must include: to the same issue should be presented
(1) The type of report the auditor as a single audit finding. Where prac-
issued on whether the financial state- tical, audit findings should be orga-
merits audited were prepared in accord- nited by Federal agency or pass-
ance with QAAP (i.e., unmodified opin- through entity.
ion, qualified opinion, adverse opinion, (1i)Audit findings that relate to both
or disclaimer of opinion); the financial statements and Federal
(ii) Where applicable, a statement awards, as reported under paragraphs
about whether significant deficiencies (d)(2) and (d)(3) of this section, respeo-
or material weaknesses in internal con- tively, should be reported in both see-
trol were disclosed by the audit of the Lions of the schedule. However, the re-
financial statements; porting in one section of the schedule
183
S200.516
2 CFR Ch. 11 (1-1-14 Edition)
1W be are .`auninary Cann itn at ref. the auditor must include information
etehou Lc a. detailed reporting in the to provide proper perspective
cater ssititst;of the ss dr n rdcective for cudg_
(- )rai in t-ts past eoknica the quest oned oostsrevalence nd consequences of
ocni tog of the audit eta- g v -
gri its this stioastQi t ` lla'ieT
{ ;j Perna qufloo f r Fe that sue
Emig iro+i 63'+§200.51 a r tU S 'I r > 1'
��, art sul�:ke- Federal Pam-
ePis Chi. Data Iieliectin proVag v'1icia is a r 4411dit4lisioLval„ilt.
whey wallowed try 0 a .A6 anti . kepif a=' toi G —Ja- ii tia? alyreyas:ditur le not n,. thi
Worm P- 01 part � d1 a dicier this
molt a Federal ands t, p ed ms for
§200416 Audit fi k-Tant; therefore„ the
°ding's'' auditor will i a meill not rind sues-
�����-///yyy(al Audit findings repotted, The Audi- wias� T I
r� 3YH thaLl; is1Ya3
following as audit audited85 a matler all > m''findings in a shed-Ede of din if 8 Mi i days as ase sjw a of
wed questioned ousts for a;t6d,s
(1)SiSalifiosat defidendes and mate- 61 't$a got 4104itad aS as maim
riall weaknesses in into l control 04...es jrato of aft fellow-U
over major mgr and si la ortoted°
laestaaaa es of abuse relating try, z, lal5d cam, ®ash and that 11 totem-
Instances
Programs, The atsdi g: del _ dlust re e�lta q1
of wlti t�a ds19cien in i® au o tion t:t d�[ r Must p t fiiiia ae
roll le a eloifleactt deficiency or mart- ( The cire
ttniftanolaS fi e n mil'weakness for ha p of QOrt= `i a sad r a7nahth' -eF an wtfldt m a+ g 1$ in ref ion to a for a program is d ithaitv of compliancedbled ow, unliess such Bia-
lin rement for a an idw n1fied ie to Oral, rmets are otherwise reported �splSae SuPpiamt,
t';9 fa?Gatotsal audit findings in the Oohed as of find-
Mutated. with the Inge
visions 1�eder a Statut d questioned costsfag Federal
L'rati>c, ate.Lions, or OA, texts and conditions of awn rear is M.y fraud is dtJ
riw3 i t�,11u>;t CO a W&I Jai a
�L' • '-ems it4r`s Mete s of d .rucl a a I, Lt7<a rt!gg midi tea ri Is
ar
whether a non n With in the ee reported ae aid audit tu:-'i.waleca a',>` iF wadi >�at�, swat- � �� �,1� of Jodi . a� ceu�dons,. or the 'terms and conditions of mriuei! 11 d � Federal5at'ib i'
7F4d aj aTMtfs:i 98 �,terli � tor the D« pe---- b�, -00 no �'-g_ 6 : RI ►.iadiifor Pose of reporting- audit 1�Jecifrt i€ in ` report publicly a tssa'sa t hi>b
gala tf(n r.e a:: ' 'pt�. „af oc eliit tee re, iai TMEEPSVMdtt9 111 'ti Vrt q iremerCG rot, as faro- 'aged p!irtsera c'-
god in the o& deQttf= or to Make a3rfi-
ts> ow8 i i;. ti i nepr lag.When the as deeg1 cosi--
(9l Known questioned ocean that a }sat:the fraud Wag reported
g-'I our th i 4 ,il 'for a t;1t :�9de the as alit�r'a r'o- ov-
lr6ianc� �,. � of r+om= �t^Ga under the di“
+iuit erasers t a majorgoo_ t reporting T criremon in of GALAS,
orant Known questioned owesaro cll. inetatioes whom the resift of
moss spacifically identified by tie &ta llt rolow a fi pa' killits a rrauditor, to 5;ainaeins- the s1 t or t h summary schedule vf pior
questioned coats on e opinion
on fmglit rEndisse prepared by Use ai ditee
compliance, the auditor considers the 12 a .wit211-10,511 Ausiit rl-
b 9 estimate of total moats emestirned ids follo-uipi rsorelmell q ) maori-
(likely t1 tefI icaa;od; costuov Da just til, otliy nalarepresents the dtii rat' any
4nentioned cots specifically idontined Prior audit finding.
4-rtow . q wtioned, a te). The auditor (ti') Audi? f-
arruat 4.24tra tupa t, known estfioue+.1 Audit 4+"ms� tie 1F - n
Wets what likely questioned a are w ui�:wala nt dan must, l presented Lai
�i•ea,tor than sge,ttJr3 it3T ei t, detali and �Bar�ia;� f� Lae
>lrii to g type cfr ova- in,udite to prepare a, conerti�re �a:toti
grant I reument for a major moo- plan and ke t:orra Utivo
reputing questiod.raa a;aast rc-r 'aaaler'ai ass-t ?t, awl
agencies pass-kit rotrgh
OMB Guidance §200.517
entities to arrive at a management de- resent an isolated instance or a eye-
oision. The following specific informs- tondo problem. Where appropriate, in-
ton must be included, as applicable, in stances identified must be related to
audit findings: the universe and the number of cases
(1) Federal program and specific Fed- examined and be quantified in terms of
eral award identification including the dollar value.The auditor should report
CFDA title and number, Federal award whether the sampling was a statis-
identification number and year, name tidally valid sample.
of Federal agency, and name of the ap- (8) Identification of whether the
plioable pass-through entity. When in- audit finding was a repeat of a finding
formation, such as the CFDA title and in the immediately prior audit and if
number or Federal award identification so any applicable prior year audit find-
number, is not available, the auditor ing numbers.
must provide the best information (9) Recommendations to prevent fu-
available to describe the Federal ture occurrences of the deficiency iden-
award. tilted in the audit finding.
(2) The criteria or specific require- (10) Views of responsible officials of
ment upon which the audit finding is the auditee,
based, including the Federal statutes, (a) Reference numbers. Each audit
regulations, or the terms and oondi- finding in the schedule of findings and
tions of the Federal awards. Criteria questioned costs must include a ref-
generally identify the required or de- erenee number in the format meeting
sired state or expectation with respect the requirements of the data collection
to the program or operation. Criteria form submission required by §200.512
provide a. context for evaluating evi- Report submission, paragraph (b) to
denoe and understanding findings. allow for easy referenoing of the audit
(3) The. condition found, including findings during follow-up.
facts that support the deficiency iden-
tified in the audit finding. 1200.517 Audit documentation.
(4) A statement of cause that identi- (a) Retention of audit documentation.
ties the reason or explanation for the The auditor must retain audit docu-
condition or the factors responsible for mentation and reports for a minimum
the difference between the situation of three years after the date of
that exists (condition) and the required issuance of the auditor's report(s) to
or desired state (criteria), which may the auditee, unless the auditor is not-
also serve as a basis for recommend.a fled in writing by the cognizant agency
tions for corrective action, for audit, oversight agency for audit,
(5) The possible asserted effect to cognizant agency for indirect costs, or
provide sufficient information to the pass-through entity to extend the re-
auditee and Federal agency, or pass- tendon period. When the auditor is
through entity in the case of a sub- aware that the Federal agency, pass-
recipient, to permit them to determine through entity, or auditee is con-
the cause and effect, to facilitate testing an audit finding, the auditor
prompt and proper corrective action. A must contact the parties contesting
statement of the effect or potential ef- the audit finding for guidance prior to
feet should provide a clear, logical link destruction of the audit documentation
to establish the impact or potential and reports.
impact of the difference between the (b) Access to audit documentation.
condition and the criteria. Audit documentation must be made
(6) Identification of questioned costs available upon request to the cognizant
and how they were computed. Known or oversight agency for audit or its des-
questioned costs must be identified by ignee, cognizant agency for indirect
applicable CFDA number(s) and appli- cost, a Federal agency, or GAO at the
cable Federal award identification completion of the audit, as part of a
number(s). quality review, to resolve audit find-
(7)Information to provide proper per- lugs, or to carry out oversight respon-
spective for judging the prevalence and sibilities consistent with the purposes
consequences of the audit findings, of this part. Access to audit doou-
such as whether the audit findings rep- mentation includes the right of Federal
1B5
§200.518 2 CFR Ch. 11 (1-1-14 Edltlon)
agencies to obtain copies of audit docu- loans if the value of Federal awards ex-
mentation, as is reasonable and nee- pended for loans within the program
essary. comprises fifty percent or more of the
§200.618 total Federal awards expended for the
or 01gf program. A cluster of programs is
treated as one program and the value
(a) General. The auditor must use a of Federal awards expended under a
risk-based approach to determine loan program is determined as de-
which Federal programs are major pro- scribed in 1200.502 Basis for deter-
grams. This risk-based approach must mining Federal awards expended.
include consideration of: current and (4) For biennial audits permitted
prior audit experience, oversight by under §200.504 Frequency of audits, the
Federal agencies and pass-through en- determination of Type A and Type B
titles, and the inherent risk of the Fed- programs must be based upon the Fed-
eral program. The process in pare- eral awards expended during the two-
graphs (b) through (i) of this section year period.
must be followed, (o) Step two. (1) The auditor must
(b) Step one.(1) The auditor must identify Type A programs which are
identify the larger Federal programs, low-risk. In making this determine,-
which must be labeled Type A. pro- tion, the auditor must consider wheth-
grams. Type A programs are defined as er the requirements in §200.519 Criteria
Federal programs with Federal awards for Federal program risk paragraph(c),
expended during the audit period ex- the results of audit follow-up, or any
ceeding the levels outlined in the table changes in personnel or systems affect-
in this paragraph (b)(1): ing the program indicate significantly
Total Federal awasis ex- increased risk and preclude the pro-
pended Type AIB threshold gram from. being low risk. For a Type
A program to be considered low-risk, it
Equal to$750,000 but Tess $750,000. must have been audited as a major pro-
tean or equal to$25 million. j p
Exceed$25 million but lees Total Federal awards ex- gram in at least one Of the two most
then or equal to$100 mil- panted times.03. recent audit periods (in the most re-
1 a cent audit period in the case of a,bien-
Exceed$100 million but lees $3 million. rtial
Man or equal to St billion. audit), and, in the most recent
Exceed$1 billion but lees Total Federal awards ex- audit period, the program must have
than or equal to$10 billion. panted times.003. not had:
Exceed$10 billion but lesq $30 million. (i) Internal control deficiencies
than orequal to$20 billion which were identified as material
Exceed$20billion Total Federal awards ex-
panded times.0015. weaknesses in the auditor's report on
internal control for major programs as
(2) Federal programs not labeled required under §200.515 Audit report-
Type A under paragraph (b)(1) of this ing, paragraph (c);
section must be labeled Type B pro- (if) A modified opinion on the pro-
grams. gram in the auditor's report on major
(3) The inclusion of large loan and programs as required under §200.515
loan guarantees (loans) should not re- Audit reporting,paragraph(c); or
suit in the exclusion of other programs (iii)Known or likely questioned costs
as Type A programs. When a Federal that exceed five percent of the total
program providing loans exceeds four Federal awards expended for the pro-
times the largest non-loan program it gram.
is considered a large loan program, and (2) Notwithstanding paragraph (c)(1)
the auditor must consider this Federal of this section, OMB may approve a
program as a Type A program and ex- Federal awarding agency's request that
elude Its values in determining other a Type A program may not be oonsid-
Type A programs. This recalculation of ered low risk for a certain recipient.
the Type A program is performed after For example, it may be necessary for a
removing the total of all large loan large Type A program to be audited as
programs. For the purposes of this a major program each year at a par-
paragraph a program is only considered titular recipient to allow the Federal
to be a Federal program providing awarding agency to comply with 31
186
OMB Guidance §200.519
U.S.C. 3515. The Federal awarding additional Federal programs with Fed-
agency must notify the recipient and, eral awards expended that, in aggre-
if known, the auditor of OMB's ap- gate, all major programs encompass at
proval at least 180 calendar days prior least 20 percent (0.20) of total Federal
to the end of the fiscal year to be au- awards expended. Otherwise, the audi-
dited. tor must audit the major programs
(d) Step three. (1) The auditor must identified in Step 4 (paragraphs (e)(1)
identify Type B programs which are and (2) of this section) and such addi-
high-risk using professional judgment tional‘Federal programs with Federal
and the criteria in §200.519 Criteria for awards expended that, in aggregate, all
Federal program risk. However, the major programs encompass at least 40
auditor is not required to identify more percent (0.40) of total Federal awards
high-risk Type B programs than at expended.
least one fourth the number of low-risk (g) Documentation of risk. The auditor
Type A programs identified as low-risk must include in the audit documenta-
under Step 2 (paragraph (a) of this sec- tion the risk analysis process used in
tion). Except for known material weak- deterining major programs.
ness in internal control or compliance (h) auditor's judgment. When the
problems as discussed in §200.519 Cri- major program determination was per-
teria for Federal program risk para- formed and documented in accordance
graphs (b)(1), (b)(2), and (c)(1), a single with this Subpart, the auditor's judg-
criteria in. risk would seldom cause a meat in applying the risk-based ap-
Type B program to be considered high- preach to determine major programs
risk. When identifying which Type B must be presumed correct. Challenges
programs to risk assess, the auditor is by Federal agencies and pass-through
encouraged to use an approach which entities must only be for clearly im-
provides an opportunity for different proper use of the requirements in this
high-risk Type B programs to be au- part. However, Federal agencies and
dited as major over a period of time. part. However, Federal agencies and
(2)The auditor is not expected to per- pass-through entities may provide
auditors guf
form risk assessments on relatively da,r oe about the risk of a
small Federal programs. Therefore, the particular Federal program and the
auditor is only required to perform risk auditor must consider this guidance in
assessments on Type B programs that determining major programs in audits
exceed twenty-five percent (0.25) of the not yet completed.
Type A threshold determined in Step 1 §200.519 Criteria for Federal program
(paragraph(b) of this section). risk.
(e) Step four. At a. minimum, the
auditor must audit all of the following (a) General. The auditor's determina-
as major programs: tion should be based on an overall eval-
(1) All Type A programs not identi- uation of the risk of noncompliance oc-
fied as low risk under step two (pare- curving that could be material to the
graph_(c)(1)of this section). Federal program. The auditor must
(2) All Type B programs identified as ooneider criteria, such as described in
high-risk under step three (paragraph paragraphs (b), (c), and (d) of this sec-
(d)of this section). tion, to identify risk,in Federal pro-
(3) Such additional programs as may grams. Also, as part of the risk anal-
be necessary to comply with the per- ysis, the auditor may wish to discuss a.
tentage of coverage rule discussed in particular Federal program with
paragraph (f) of this section. This may auditee management and the Federal
require the auditor to audit more pro- agency or pass-through entity.
grams as major programs than the (b) Current and prior audit experience.
number of Type A programs. (I)Weaknesses in internal control over
(f) Percentage of coverage rule. If the Federal programs would indicate high-
auditee meets the criteria in §200.520 er risk. Consideration should be given
Criteria for a low-risk auditee, the to the control environment over Fed-
auditor need only audit the major pro- oral programs and such factors as the
grams identified in Step 4 (paragraph expectation of management's adher-
(e)(1) and (2) of this section) and such once to Federal statutes, regulations,
18i1
§200.520
2 CFR Ch. fl (1-1-14 Editlon)
and the terms and conditions of Fed- personal services, but otherwise be at
eras awards and the competence and low risk,
experience of personnel who administer f], y Qf a i rut
the Federal programs. program
CD(l} Federal its life cycle at the l aid a e �
Federa internal lufstered may Sndi�e.ate risk: For example, a new
res may have :tit ral s Federal er 1 program with ow or .trim
tueeitig k r risk. When as- regulations may havehigher risk theme
e single audit, the 4,0 est iabed program with :sate-test..
%eiditor must consider whether weak- ed rei.ls,.ti Also, significant
muss are isolated in a p Agnate;s bi Federal
at ng unit ce.g. on $single caper-or- Matinee..
®er=va Rims throughout the ehti
.) or regulations, or Oho terriesEli-
(if) When a tines r1f;r�md a s increase
asn
ig'�1i�ma8t parts of a F'ed. risk.
sal peograre are passed tirwough to (3)The phase of a Federal program in
selamipdenit ,a was&system fur maul- Its life 4700 a1 the aiiditee
maor
toting subrecipienia would indicate gate risk.-For floe.
higher risk, and aprlc„�'dta�t 1 fae
(2) Prior audit findings would indi- loft pears That an a tee pa ici-
es b Feder Prrigtesio. Vi®
Date higher risk,
Particularly when the Caw be highar doe t
situations identified in the audit find- nintof art-op or cira -
tugs could have a significant Impact on 4 � m1:8vitiv d� '
a Federal program or have not been en t mule s with l sr 1gh
corrected. . 'de dad: he of high-
corrected.
yr risk than prom= w$th eufiet
(3) Federal programs not recently au- 4sli Viler Federal awar ex
dited as major programs may be of Pemba,
higher risk than Federal programs re-
cently audited as major programs with- §200.520 Criteria for a lowriak
out audit findings. auditee.
(c)Oversight exeroised dap pedant apna. An auditee that meets all of the fol-
cada and pecte-th.raaall watt Gv,o- lowing conditions for each of the pre-
sight exeroleed hY Forloral agencies or ceding two audit periods must qualify
paw-through entities could be used to as a low-risk auditee and be eligible for
se risk' fPor example., mast mn,uurl= reduced audit coverage in accordance
deg- or outer re/views perform^d by with §200.518 Major program deter-
overSight entity that- ifteclosed nc mination.
alemifieaut problems would Indicate (.0 f g e suably wore performed on
lower Mak. whereas man♦torkne that, ao sun al bards in souls:
daselneed ssgulan ii, problem wouldoe wishing
g � s�m� of this Subpart,
1ndK higher risi neiwi g
fibmittinx the data collection form
(2)Federal agencies,with the concur- and the reporting malaise to the, i'AC:1
rence of OMB, may identify Federal within to the Umef sme specified
in
programs that are higher risk. OMB 52tHIL612 Report sobrniiieleal. A ben—Peal,
will provide this identification in the entity that has biennial stets
compliance supplement. does ,io t, u.0 lily aa a low-risk
auditee,
(d) initeee/j r4&. Pederal por- (h The auditor's opinion on auhyetlaoz°
iTrUNt, Cl1 Mc eat of a Federal pro- me iihahntai Ituutneutto.we prepared
gram ma; r iS , cingidarailiab i .ae_r ce with 43tr a s
u theprogramdbe given La the complexity of ae ti:c regtu eol b� etata law, and
and the extent- to which tho suiliaoeis In relation to opinion on
she F n&,t program t outrs i for the ems tide of aen± Wires el-Federal
gocce and senitoes. For examPle, Fed- aaueArde a 010111Mlifict,
as a prnbrar i that thatagraa fa ark. (e) There were- no tiailetenaies to fin-
tljrnurh third PartY routracia or, .have to w1 control which were identified as
it1 113i9ji,� oriterla may bar of higher material weakTheaffes under the require-
rak, Federal programs primarily in- meats;of ir:A.OAS,
star"r payroll ate may have (d) The auditor did not report a sub-
high risk for nowertiPliadent with rr= stantial doubt about the auditee's abil-
rariD,cnent rat N ,431 oi p:tion— ity to continue as a going concern.
OMB Guidance Pt.200, App. i
(e) None of the Federal programs had cision for findings that relate to Fed-
audit findings from any of the fol- oral awards it makes to non-Federal
lowing in either of the preceding two entities.
audit periods in which they were classi- (o) Paso-through entity. As provided in
fled as Type A programs: §200.331 Requirements for pass-through
(1) Internal control deficiencies that entities, paragraph (d), the pass-
were identified as material weaknesses through entity must be responsible for
in the auditor's report on internal con- issuing a management decision for
trol for major programs as required audit findings that relate to Federal
under §200.515 Audit reporting, pare- awards it makes to subrecipients.
graph(a); (d) Time requirements. The Federal
(2) A modified opinion an a major awarding agency or pass-through enti-
program in the auditor's report on ty responsible for issuing a manage-
major programs as required under merit decision must do so within six
§200.515 Audit reporting, paragraph (cj; months of acceptance of the audit re-
nt port by the FAO.The auditee must ini-
(3) Known or likely questioned costs tiate and proceed with corrective au-
that exceeded five percent of the total tion as rapidly as possible and oorrec-
Federal awards expended for a Type A. tive action should begin no later than
program during the audit period. upon receipt of the audit report.
(e) Reference numbers. Management
MANAGEMENT DEOISIONS decisions must include the reference
numbers the auditor assigned to each
§200.521 Management decision. audit finding in accordance with
(a) General. The management deaf- §200.516 Audit findings paragraph(a).
sion must clearly state whether or not Apymnix I TO FART 200—FULL TEXT OF
the audit finding is sustained, the rea- ios No OF FUNDING OPPORTVNrrY
sons for the decision, and the expected
auditee action to repay disallowed The full text of the notice of f 1T $lug op-
costs, make financial adjustments, or portunity is organized in sections. The re-
take other action. If the auditee has quired format outlined in this appendix indi-
not completed corrective action, a cater immediately following the title of each
timetable for follow-up should be section whether that section is required in
Prior to issuing the manage- every announcement or is a Federal award-
given. so
Ment decision, the Federal agency a agency otypes ofT informatione format is widell
appnedear
ar
g cY or that similar types of will appear
pass-through entity may request addi- in the same sections in announcements of
tonal information or documentation different Federal funding opportunities. To-
from the auditee, including a request ward that end, there is text in each of the
for auditor assurance related to the following sections to describe the types of In-
formation that a Federal awarding agency documentation, as a way of mitigating
disallowed costs. The management de_ would include in that section of an actual
vision should describe anyannouncement.
appeal pros- A Federal awarding agency that wishes to
ess available to the auditee. While not include information that the format does not
required, the Federal agency or pass- specifically discuss may address that subject
through entity may also issue a man- in whatever sections) is most appropriate.
agement decision on findings relating For example, if a Federal awarding agency
to the financial statements which are chooses to address performance goals in the
required to be reported in accordance announcement,it might do so in the funding
with GAG-AS. opportunity description,the application con-
tent,or the reporting-requirements.
(b) Federal agency. As provided in similarly, when this format calls for a
§200.513 Responsibilities, paragraph type of information to be in a particular sec-
(a)(7), the cognizant agency for audit tion, a Federal awarding agency wishing to
must be responsible for coordinating a address that subject in other sections may
management decision for audit find_ elect to repeat the information in those sec-
ings that affect the programs of more Lions or use cross references between the sec-
than one Federal agency. As provided tions (there should be hyperlinke for cross-
in §200.b13 Responsibilities, paragraph ferencas in any electronic versions of the
anlouneement). For example, a Federal
(e)(3), a Federal awarding agency is re- awarding agency may want to include in
sponsible for issuing a management de- Section I information about the types of
189
Pt. 200, App. 1 2 CFR Ch. 1I (1-1-14 Edition)
non-Federal entities who are eligible to quired or Federal award administration in-
apply. The format specifies a standard looa- formation in section D.Application and Sub-
tion for that information in Section 111.1 but mission Information). If procurement con-
that does not preclude repeating the infer- tracts also may be awarded, this must be
motion in Section.I or creating a oross ref- stated.
erence between Sections I and 111.1, as long
as a potential applicant can find the infor- C.ELIGIBILITY INFORMATION
mation quickly and easily from the Standard This section addresses the considerations
location, or factors that determine applicant or appli-
The sections of the full text of the an- cation eligibility. This includes the eligi-
nouncement are described in the following bility of particular types of applicant organi-
pouagraph& zations, any factors affecting the eligibility
A.PROGRAM DESOREPTION—REQUIEM of the principal investigator or project direc-
tor, and any criteria that make particular
This section contains the full program de- projects ineligible. Federal agencies should
scription of the funding opportunity.It may make clear whether an applicant's failure to
be as long as needed to adequately commu- meet an eligibility criterion by the time of
nicate to potential applicants the areas in an application deadline will result in the
which funding may be provided.It describes Federal awarding agency returning the ap-
the Federal awarding agency's funding prior- pliostion without review or, even though an
ities or the technical or focus areas in which application may be reviewed, will preclude
the Federal awarding agency intends to pro- the Federal awarding agency from making a
vide assistance. As appropriate, it may in- Federal award,Key elements to be addressed
elude any program history(e.g..whether this are
is a new program or a new or changed area of 1. Eligible Applicants—Required. Announce-
program emphasis), This section may con- ments must clearly identify the types of en-
municate indicators of successful projects titles that are eligible to apply. If there are
(e.g., if the program encourages oollabo- no restrictions on eligibility, this section
rative efforts) and may include examples of may simply Indicate that all potential appli-
projects that have been funded previously. cants are eligible.If there are restrictions on
This section also may include other informa- eligibility, it is important to be clear about
tion the Federal awarding agency deems nee- the specific types of entities that are eligi-
essary, and must at a minimum include oita- bie, not just the types that are ineligible.
Urine for authorizing statutes and regale- For example, if the program is limited to
tions for the funding opportunity. nonprofit organizations subject to 26 U.S.C.
B. FEDERAL AwAnu INFORMATION—REQUIRED 501(e)(3) of the tax code (26 U.S.C. 501(c)(3)),
the announcement should say so. Similarly,
This section provides sufficient informa- it is better to state explicitiy that Native
tion to help an applicant make an informed American tribal organizations are eligible
decision abort whether to submit a proposal. than to assume that they can unambiguously
Relevant information could include the total infer that from a statement that nonprofit
amount of funding that the Federal awarding organizations may apply.Eligibility also can
agency expects to award through the an- be expressed by exception, (e.g., open to all
nounoement; the anticipated number of Fed- types of domestic applicants other than indi-
eral awards; the expected amounts of inch- viduals). This section should refer to any
viduai Federal awards (which may be a portion of Section IV specifying documenta-
range); the amount of funding per Federal tion that must be submitted to support an
award, on average, experienced in previous eligibility determination (e.g., proof of
years; and the anticipated start dates and 501(c)(3)status as determined by the Internal
periods of performance for new Federal Revenue Service or an authorizing tribal res-
awards. This section also should address elution).To the extent that any funding re-
whether applications for renewal or sup- striation in Section I4.6 could affect the eli-
plementation of existing projects are eligible gibjiity of an applicant or project, the an-
to compete with applications for new Fed- nouncement must either restate that restrict
eral awards. tion in this section or provide a cross-ref-
This section also must indicate the type(s) erence to its description in Section IV.5.
of assistance instrument(e.g.,grant, cooper- 2. Cost Sharing or Matching—Required. An-
ative agreement) that may be awarded if ap- nounoements must state whether there is re-
plications are successful. If cooperative quired cost sharing, matching, or cost par-
agreements may be awarded, this seotion ei- ticipation without which an application
they should describe the "substantial in- would be ineligible(if cost sharing is not re-
volvement" that the Federal awarding agen- quired, the announcement must explicitly
oy expects to have or should reference where say so).Required oast sharing may be a cer-
the potential applicant can find that infer- talc percentage or amount,or may be in the
motion (e.g., in the funding opportunity de- form of contributions of specified items or
scription in A. Program Description—Re- activities(e.g., provision of equipment). It is
190
OMB Guidance Pt. 200,App. I
important that the announoement be clear quired forms or formats as part of the an-
about any restrictions on the types of oast nouncement or state where the applicant
(e.g., in-kind contributions) that are accept- may obtain them.
able as cost sharing. Cost sharing as an eligi- This section should specifioal►y address
bi_lity.criterion includes requirements based content and form or format requirements
in statute or regulation, as described in for:
§200.306 Cost sharing or matching of this 1. Pre-applioations. letters of intent, or
Part.This section should refer to the appro- white papers required or encouraged (see
priate portion(s) of section D. Application Section Iv,3), including any limitations on
and Submission Information abating any pre- the number of pages or other formatting re-
award requirements for submission of letters quirements similar to those for full applies-
or other documentation to verify commit- tions.
ments to meet coat-sharing requirements if a Ii.The application as a whole. For all sub-
Federal award is made. missions,this would include any limitations
3. Other—Required,if applicable.If there are on the number of pages, font size and type-
other eligibility criteria (i.e.. criteria that face, margins,paper size, number of copies,
have the effect of making an application or and sequence or assembly requirements. If
project ineligible for Federal awards.wheth- electronic submission is permitted or re-
er referred to as "responsiveness" criteria, quired, this could include special require-
"go-no go" criteria, "threshold" criteria, or ments for formatting or signatures.
in other ways), must be clearly stated and at. Component pieces of the application
must include a reference to the regulation of (e.g., if all copies of the application must
requirement that describes the restriction, bear original signatures on the face page or
as applicable. For example, if entities that the program narrative may not exceed 10
have been found to be in violation of a par- pages).This includes any pieces that may be
Mauler Federal statute are ineligible, it is submitted separately by third parties (e.g.,
important to say so. This section must also references or letters confirming commit-
state any limit on the number of applioa- ments from third parties that will be con-
tions an applicant may submit under the an- tributing a portion of any required cost shar-
nounoement and make clear whether the mg),
limitation is on the submitting organization, iv. Information that successful applicants
individual investigator/program director, .or must submit after notifioation of intent to
both. This section should also address any make a Federal award,but prior to a Federal
eligibility 'criteria for beneficiaries or for award. This could include evidence of com-
program participants other than Federal plianoe with requirements relating to human
award recipients. subjects or information needed to comply
D.APPIdOATIoN AND SUMMON INFORMATION with the National Environmental Policy Act
(NEPA)(.42 U.S.C.4321-1370h).
1. Address to Request Application Package— 3. Dun and Bradstreet Universal Numbering
Required. Potential applicants must be told System (DUNS) Number and System for Award
how to get application forms, kits, or other Management(SAM_)—Required.
materials needed to apply (if this announce- This paragraph must state clearly that
ment contains everything needed, this sec- each applicant(unless the applicant is an in-
tion need only say so). An Internet address dividnal or Federal awarding agency that is
where the materials can be accessed is ac- excepted from those requirements under 2
oeptable.However, since high-speed Internet CFII§25.110(b)or(c), or has an exception ap-
access is not yet universally available for proved by the Federal awarding agency
downloading-documents,and applicants may under 2 CFR.125.110(d))is required to: (I)Be
have additional accessibility requirements, registered in SAX before submitting its ap-
there also should be a way for potential ap- plication; (11)provide a valid DUNS number
piioants to request paper copies of materials, in its application;and(ill)continue to main-
such as a U.S. Postal Service mailing ad- twin an active SAM registration with current
dress, telephone or FAX number, Telephone information at all tines during which it has
Device for the Deaf (TDD), Text Telephone an active Federal award or an application or
('r Y) number, and/or Federal Information plan under consideration by a Federal award-
Relay Service(FIRS)number. ing agency. It also must state that the Fed-
2. Content and Form of Application Submis- eral awarding agency may not make a Fed-
sian—Required. This section must identify eral award to an applicant until the appli-
the required content of an application and cant has complied with all applicable DUNS
the forms or formats that an applicant must and SAM requirements and, if an applicant
use to submit it. If any requirements are has not fully complied with the requirements
stated elsewhere because they are general re- by the time the Federal awarding agency is
quirements that apply to multiple programs ready to make a Federal award, the Federal
or funding opportunities, this section should awarding agency may determine that the ap-
refer to where those requirements may be pIicant is not qualified to receive a Federal
found. This section also should include re- award and use that determination as a basis
1G1
Pt.200, App. I 2 CFR Ch. II (1-1-14 Edition)
for making a Federal award to another appli- mental Review of Federal Programs," the
cant. notice must say so. In alerting applicants
4, Submission Dates and Times—Required. that they must contact their state's Single
Announcements must identify due dates and point of Contact (SPOC) to find out about
times for all submissions. This includes not and comply with the state's process under
only the full applications but also any pre- Executive Order 12372,it may be useful to in-
liminary submissions (e.g., letters of intent, form potential applicants that the names
white papers, or pre-applications).It also in and addresses of the SPOOs are listed in the
eludes any other submissions of information Office of Management and Budget's Web site.
before Federal award that are separate from w .wh£tehouse.gov/omb/grants/spoc.htmI,
the full application. If the funding oppor- 6. Funding Restrictions,—Required. Notices
tunity is a general announcement that is must include information on funding reetric-
open for a period of time with no specific due Lions in order to allow an applicant to de-
dates for applications, this section should an velop
say so. Note that the information on datesapplication and budget consistent
that is included in this section also must ap- with program requirements. Examples are
pear with other overview information in a lo- whether construction is an allowable activ-
cation preceding the full text of the en- ity, if there are any limitations on direct
nounoement (see §200.203 Notices of funding costs such as foreign travel or equipment
opportunities of this Part). purchases, and if there are any limits on in-
Eaoh type of submission should be des- direct costs (or facilities and administrative
ignated as encouraged or required and, if re- costs).Applicants must be advised if Federal
quired, any deadline date (or dates, if the awards will not allow reimbursement of pre-
Federal awarding agency plans more than Federal award costs.
one cycle of application submission, review, 7, Other Submission Requirements—Required.,
and Federal award under the announcement) This section must address any other submis-
should be specified. The announcement must sion requirements not included in the other
state(or provide a reference to another docu- paragraphs of this section. This might in-
merit that states): elude the format of submission,i.e.,paper or
1.Any deadline in terms of a date and local electronic, for each type of required submis-
time. If the due date falls on a Saturday, sion, Applicants should not be required to
Sunday, or Federal holiday, the reporting submit in more than one format and this sec-
package is due the next business day. tion should indicate whether they may
11. What the deadline means (e.g., whether choose whether to submit applications in
it is the date and time by which the Federal hard copy or electronically,may submit only
awarding agency must receive the applies- in hard copy, or may submit only electroni-
tioa,the date by which the application must cry
be postmarked, or something else) and how This section also must indicate where ap
-
thmethod dif 1.at all, roon the submissionerson cations(and any pre-a lloations)must be
method (e.g., mail. electronic, or personal/ � pp
courier delivery), submitted if sent by postal mail, electronic
iii. The effect of missing a deadline (e.g., means, or hand-delivery. For postal mail
whether late applications are neither re- submission,this must include the name of an
viewed nor considered or are reviewed and office, official, individual or function (e.g.,
considered under some circumstances). application receipt center) and a complete
iv, How the receiving Federal office deter- mailing address. For electronic submission,
mines whether an application or pre-applioa- this must include the URL or email address;
tion has been submitted before the deadline. whether a password(s) is required; whether
This includes the form of acceptable proof of particular software or other electronic cape,-
mailing or system-generated documentation bilities are required; what to do in the event
of receipt date and time. of system problems and a point of contact
This section also may indicate whether, who will be available in the event the appli-
when,and in what form the applicant will re- cant experiences technical difficulties.i
wide an acknowledgement of receipt. This
information should be displayed in ways that E.APPLICATION RRrVIP)W INFORMATION
will be easy to understand and use. It can be 1. Criteria,—Required. This section must ad-
difficult to extract all needed information dress the criteria that the Federal awarding
from narrative paragraphs, even when they agency will use to evaluate applications.
are well written. A tabular form for pro-
viding a summary of the information may o -
help applicants for some programs and give 1With respect to electronic methods for
them what effectively ooulci be a checklist to providing information about funding oppor-
verify the completeness of their application tunities or accepting applicants'submissions
package before submission. of Information, each Federal awarding agen-
6. Intergovernmental Review--Required,if ap- cy is responsible for compliance with Section
plicable.If the funding opportunity is subject 608 of the Rehabilitation Act of 1973 (29
to Executive Order 12372, "Intergovern- II.S.C.794d).
192
OMB Guidance Pt. 200,App. I
This includes the merit and other review cri- people on an evaluation panel and how it op-
teria that evaluators will use to Judge appli. erates, the way reviewers are selected, re-
cations,including any statutory,regulatory, viewer qualifications, and the way that con-
or other preferences(e.g.,minority status.or flints of interest are avoided.With respect to
Native American tribal preferences) that electronic methods for providing informs,
will be applied in the review'process. These tion about funding opportunities or accept-
criteria are distinct from eligibility criteria ing applicants' submissions of information,
that are addressed before an application is each Federal awarding agency is responsible
accepted for review and any program policy for compliance with Section 608 of the Reba-
or other.factors that are applied during the bilitation Act of 1973(29 U.B.C. 794d).
selection process, after the review process is In addition,if the Federal awarding agency
completed. The intent is to make the appli- permits applicants to nominate suggested re-
cation process transparent so applicants can viewers of their applications or suggest those
make informed decisions when preparing they feel may be inappropriate due to a con-
their applications to maximize fairness of flict of interest, that information should be
the process. The announcement should clear- included in this section.
ly describe all criteria,.including any sub- 3. Anticipated Announcement and Federal
criteria. If criteria vary in importance, the Award Dates—Optional. This section is in-
announcement should specify the relative tended to provide applicants with informa-
percentages, weights,or other means used to tion they can use for planning purposes. If
distinguish among them. For statutory,reg- there is a single application deadline fol-
ulatory, or other preferences, the announce- lowed by the simultaneous review of all ap-
ment should provide a detailed explanation plications, the Federal awarding agency can
of those preferences with an explicit indica- include in this section information about the
tion of their effect(e.g., whether they result anticipated dates for announcing or noti-
in additional points being assigned). tying successful and unsuccessful applicants
If an applicant's proposed cost sharing will and for having Federal awards in place.If ap-
be considered in the review process (as op- plications are received and evaluated on a
posed to being an eligibility criterion de- "rolling" basis at different times during an
scribed in Section m.2), the announcement extended period, it may be appropriate to
must specifically address how it will be con- give applicants an estimate of the time need
sidered (e.g., to assign a certain number of ed to process an application and notify the
additional points to applicants who offer applicant of the Federal awarding agency's
cost sharing, or to break ties among applies, decision.
tons with equivalent scores after evaluation
against all other factors).If cost sharing will F.FIDERAL AWARD ADMINISTRATION
not be considered in the evaluation, the an- INFORMATION
nounoement should say so, so that there is 1. Federal Award Notices—Required. This
no ambiguity for potential applicants.Vague section must address what a successful appli-
statements that coat sharing is encouraged, cant can expect to receive following seleo-
without clarification as to what that means, tion, If the Federal awarding agency's prat-
are unhelpfulf to applicants. It also ie impor- toe is to provide a, separate notice stating
tent that the announcement be clear about that an application has been selected before
any restrictions on the types of cost(e.g.,in- it actually makes the Federal award, this
kind contributions) that are acceptable as Seaton would be the plane to indicate that
cost sharing, the letter is not an authorization to begin
2. Review and Selection Process—Required. performance (to the extent that it allows
This section may vary in the level of detail charging to Federal awards of pre-award
provided. The announcement must list any coats at the non-Federal entity's own risk).
program policy or other factors or elements, This section should indicate that the notice
other than merit criteria, that the selecting of Federal award signed by the grants officer
official may use in selecting applications for (or equivalent)is the authorizing document,
Federal award (e.g., geographical dispersion, and whether it ie provided through postal
program balance, or diversity). The Federal mail or by electronic means and to whom. It
awarding agency may also include other ap- also may address the timing, form, and con-
propriate details. For example, this section tent of notifications to unsuccessful appli-
may indicate who is responsible for evalua- cants. See also 1200.$l0 Information con-
tion against the merit criteria(e.g.,.peers ex- tamed in a Federal award.
ternal to the Federal awarding agency or 2. Administrative and National Policy Re-
Federal awarding agency personnel) and/or quirements—Required.This section must iden-
who makes the final selections for Federal tify the usual administrative and national
awards.If there is a multi-phase review proo- policy requirements the Federal awarding
sea (e.g., an external panel advising internal agency's Federal awards may include. Pro-
Federal awarding agency personnel who viding this information lets a potential ap-
make final recommendations to the deciding plicant identify any requirements with
official),the announcement may describe the which it would have dill cultyy complying if
phases. It also may include: the number of its application la successful.In those oases,
193
Pt. 200, App. II 2 CFR Ch. II (1-1-14 Edition)
early notification about the requirements al- H.OTnER INFORMAT[ON--0PTIONAI,
lows the potential applicant to decide not to
apply or to take needed actions before re- This section may include any additional
information the Federal award. The announce- information that will assist a potential ap-
ment need not include all of the terms and pint.For eahethe,the section new pro
conditions of the Federal award, but mayi' Indicate whether this is a program
or a one-time initiative.
refer to a document(with infn motion about ii. Mention related programs or other up-
how to obtain it) or Internet site where ap- coming or ongoing Federal awarding agency
plioants can see the terms and conditions,.If fending opportunities for similar activities.
this funding opportunity will lead to Federal ill. Include current Internet addresses for
awards with some special terms and condi- Federal awarding agency Web sites that may
tions that differ from the Federal awarding be useful to an applicant in understanding
agency's usual (sometimes called "general") the program.
terms and conditions, this section should iv.Alert applicants to the need to identify
highlight those special terms and conditions. proprietary information and inform them
Doing so will alert applicants that have re- about the way the Federal awarding agency
ceived Federal awards from the Federal will handle it
awarding agency previously and might not v. Include certain routine notices to appli-
otherwiae expect different terms and condi- cents (e.g., that the Federal government is
time, For the same reason, the announce_ not obligated to make any Federal award as
merit should inform potential applicants a resultnt officers the announcement Federal that govern-
aboutonly
special requirements that could apply grantsthe
x enri binduof the nds),to particular Federal awards after the review meat to the expenditure funds).
of applications and other information, based psPPEpIDg It TO PART 200--CONTRACT
on the particular circumstances of the effort PROVISIONS FOR NON-FEDERAL ENTI_to be supported(e.g., if human subjects were
to be involved or if some situations may lux- A CONTRACTS UNDER FEDERAL
special terms on intellectual property, WARDS
data sharing or security requirements). in Millitisr to ether
by
3. Reporting Required. This section must the Fedora'annoy cr F 4 j en required all
include general information about the type uOn m esdl al en ty
(e.g., financial or performance), frequency, ands the Feden w Fe need ehtiti-
4 y, su+tjmtttstt�:tain prnv-
and means of submission (paper or oleo- gins meeting the feliniWing,se apPlieahle..,
Ironic) of post-Federal award reporting re- (A)riwita`nnts ihr nnore than.the slMul;lfl5d
quiremente. Highlight any special reporting segutAtiont t ei eld CarreELVY set at
requirements for Federal awards under this MGM wb9_oh la the infistklin Aimed
ad
funding opportunity that differ (e.g., by re- °°° drib r nail by' th° M.vi�i Agarncy'
port type, frequency, form/format, or cir- Ai sinceilmilluu and the lliefunes;Amin/s
aumetaizces for use) from what the Federal tibm unat10� Co ll (tlo snails) as. ati-
awarding agency's Federal awards usually 44 o t a ual, of .ad
require, ministrative, contractual, or legal remedies
in instances where contractors violate or
breach contract terms, and provide for such
G.FEDERAL AWARDING AGENCY C°NTA(;P(6)—
sanctions and penalties as appropriate.
(B)All contracts in excess of$10,000 must
The announcement must give potential ap- address termination for cause and for con-
plicants a point(s) of contact for answering venienoe by the non-Federal entity including
questions or helping with problems while the the manner by which it will be effected and
funding opportunity is open. The intent of the basis for settlement.
this requirement is to be as helpful as pos- (0) Equal Employment Opportunity. Ex-
sible to potential applioaots, so the Federal cept as otherwise provided under 41 OFR
awarding agency should consider approaches Part 60, all contracts that meet the defini-
suab as giving: tion of"federally assisted construction con-
s. Points of contact who may be reached in tract"in 41 CFR Part 60-1.3 must include the
multiple ways (e.g., by telephone, FAX, and/ equal opportunity clause provided under 41
OFR
or email,as well as regular mail). Order
60-1.4(b), in accordance with Executive
ii. A fax or email address that multiple Order 11246, "Equal Employment Oppor-
tunny' (30 FR 12319,1293b,3 OFR Part,
people access, so that someone will respondLive
even if others are unexpectedly absent dur- Ordere C 113'lmp., ,p "A), ns amended uby ve Orderir
inn critical periods. 1I37b, Amending Executive
Oppor-
iii. Different contacts for distinct kinds of 11248 Relating to Equal Employment help(e.g.,Df one foro sac questions ofprogrammaticsotunity," and implementing regulations at 41
CFR part 60, "Office of Federal Contract
content and a second for administrative Compliance Programs, Equal Employment
questions), Opportunity,Department of Labor."
)�Gr1
OMB Guidance Pt. 200, App. 11
(D)Davis-Bacon Act,as amended(40 U.S.C. materials or articles ordinarily available on
3141-3148).When required by Federal program the open market, or contracts for transpor-
legislation, all prime construction contracts tation or transmission of intelligence.
in excess of 82,000 awarded by non-Federal (F) Rights to Inventions Made Under a
entities must include a provision for compy- Contract or Agreement.If the Federal award
anoe with the Davis-Bacon Ant (40 U.S.C. meets the definition of"funding agreement"
3141-3144, and 5148-8148) as supplemented by under 87 CFR§401.2 (a) and the recipient or
Department of Labor regulations (29 CFt subrecipient wishes to enter into a contract
Part 6, "Labor Standards Provisions Appli- with a small business firm or nonprofit orga-
cable to Contracts Covering Federally F3- nization regarding the substitution of par-
named and Assisted Construction"). In ae- ties, assignment or performance of experi-
cordance with the statute, contractors must mental, developmental, or research work
be required to pay wages to laborers and me- under that"funding agreement." the reoipi-
chanios at a rate not less than the prevailing ant or subreoipient must comply with the re-
wages specified in a wage determination quirements of 87 CFR Part 4D1,"ll<igblts to In-
made by the Secretary.of Labor.In addition, ventions Made by Nonprofit Organizations
contractors must be required to pay wages and Small. Business Firms Under Govern.-
not less than once a week. The non-Federal ment Grants, Contracts and Cooperative
entity must place a copy of the current pre- Agreements," and any implementing regula-
veiling wage determination issued by the De- tions issued by the awarding agency.
pertinent of Labor in each solicitation. The (G)Clean Air Act(42 U.S.C.7401-7871q.)and
decision to award a contract or subcontract the Federal Water Pollution Control Act (33
must be conditioned upon the acceptance of U.S.C.1251-1387),as amended--Contracts and
the wage determination.The non-Federal en- subgrants of amounts in excess of'$150,000
tity must report all suspected or reported must contain a provision that requires the
violations to the Federal awarding agency. non-Federal award to agree to comply with
The contracts must also include a provision all applicable standards, orders or regula-
for compliance with the Copeland. "Anti- Lions issued pursuant to the Olean Air Act
Kickback" Act (40 U.S.C. 3145), as supple- (42 U.S.C. 7401-7671q) and the Federal Water
mented by Department of Labor regulations Pollution Control Act as amended(33 U.S.C.
(29 CFR Part 3, "Contractors and Sub- 1251-1387).Violations must be reported to the
contractors on Public Building or Public Federal awarding agency and the _Regional
Work Financed in Whole or in Part by Loans Office of the Environmental Protection
or Grants from the United States").The Act Agency(EPA).
provides that each contractor or sub- (B) Mandatory standards and policies re-
recipient must be prohibited from inducing, lating to energy efficiency which are con-
by any means, any person employed in the tamed in the state energy conservation plan
construction, completion, or repair of public issued in compliance with the Energy Policy
work, to give up any part of the compensa- and Conservation Act(42 U.S.C.6201).
Lion to which he or she is otherwise entitled. (I) Debarment and Suspension (Executive
The non-Federal entity must report all sus- Orders 12549 and 12689)—A contract award
'noted or reported violations to the Federal (see 2 CFR 180220)must not be made to par-
awarding agency. ties listed on the governmentwide Excluded
(B) Contract Work Hours and Safety Parties List System in the System for Award
Standards Act (40 U.S.C. 3701-3708). Where Wanagement (SAM), in accordance with the
applicable,all contracts awarded by the non- OMB guidelines at 2 CFR 180 that implement
Federal entity in excess of $100,000 that In Executive Orders 12549 (3 CFR Part 1986
volve the employment of mechanics or labor- Comp., p. 189) and 12689 (8 CFR Part 1;.9
ere must include a provision for compliance Camp.,p.235),"Debarment and Suspension."
with 40 U.S.C. 3702 and.3704,as supplemented The Excluded Parties List System in SAM
by Department of Labor regulations(29 CFR contains the names of parties debarred, sue-
Part 5). Under 40 U.S.C.2702 of the Act, each pearled,or otherwise excluded by agencies,as
contractor must be required to compute the well as parties declared ineligible under stat-
wages of every mechanic and laborer on the utory or regulatory authority other than Ex-
basis of a standard work week of 40 hours, ecntive Order 12549.
Work in excess of the standard work week is (J) Byrd Anti-Lobbying Amendment (31
permissible provided that the worker is corn- U.S.C. 1852) -Contractors that apply or bid
pensated at a rate of not less than one and-a for an award of$109,000 or more must file the
half times the basic rate of pay for all hours required certification. Each tier certifies to
worked in excess of 40 hours in the work the tier above that it will not and has not
week.The requirements of 40 U.S.C. 9704 are used Federal appropriated funds to pay any
applicable to construction work and provide person or organization for influencing or at-
that no laborer or mechanic must be re- tempting to influence an officer or employee
quired to work in surreeemegs or under of any agency,a member of Congress, officer
working conditions which are unsanitary, or employee of Congress,or an employee of a
hazardous or dangerous. These requirements member of Congress in connection with ob-
do not apply to the purchases of supplies or taming any Federal contract, grant or any
195
Pt. 200, App. III 2 CFR Ch. II (1-1-14 Edition)
other award covered by 31 U.S.C, 1352. Each (1) Sponsored research means all research
tier must also disclose any lobbying with and development activities that are span-
non-Federal funds that takes place in con- Bored by Federal and non-Federal agencies
nation with obtaining any Federal award. and organi.eetions.This term includes activi-
Suob disclosures are forwarded from tier to ties involving the training of individuals in
tier up to the non-Federal award. research techniques (commonly called re-
(K) See f 200.322 Procurement of recovered search training)where such activities utilize
materials, the same facilities as other research and de-
velopment activities and where such activi-
APPENDIX III TO PART 200—INDIRECT ties are not included in the instruction funk-
(F&A) COSTS IDENTIFICATION AND tion.
ASSIGNMENT, AND RATE Dr;rEti,MINA- (2) University research means all research
TION FOR INSTITUTIONS OF HIGHER and development activities that are sepa-
EDUCATION (LEES) rately budgeted and accounted for by the in-
stitution under an internal application of in-
A.Otron KAi, stitutional funds. University research, for
This appendix provides criteria for identi- purposes of this document, must be com-
fying and computing indirect (or indirect blued with sponsored research under the
(1'&A)) rates at IEl'Es (institutions). Indirect mnotion of organized research,
(F&A) costs are those that are incurred for ° Other sponsored activities means programs
common or joint objectives and therefore and projects financed by Federal and non-
cannot be identified readily and specifically Federal agencies and organizations which in-
volve the performance of work other than in-
with a particular sponsored project, an in-
structional activity, or any other institu- atruotion and organized research. Examples
tionai activity. See subsection B.1, Defini- of such programs and projects are health
tion of Facilities and Administration, for a service projects and community service pro-
discussion of the components of indirect grams.$owever,when any of these activities
(F&A)costs. are undertaken by the institution without
outside support, they may be classified as
1.Major Functions of an Institution other institutional activities,
Refers to Instruction, organized research. d. Other institutional activities means all an-
other sponsored activities and other institu- tivities of an institution except for instruc-
tional activities as defined in this section: on, departmental research, organized re
a, Instruction means the teaching and search,and other sponsored activities,as de-
training activities of an institution. Except fined in this section; indirect (F&A)cost so-
for research training. as provided in sub- tivities identified in this Appendix para-
graphsection b,this term includes all teaching and B,Identification and assignment of In-
trainintg aotivities, whether they are offered direct (F&A) costs; and specialized services
for credits toward a degree or certificate or facilities described in $200,968 Specialized
on a non-credit basis, and whether they are service facilities of this Part.
offered through regular academic depart- Examples of other institutional activities
meats or separate divisions, such as a sum_ include operation o residence halls, dining
mer school division or an extension division. halls, hospitals and clinics, student unions,
Also considered part of this major function intercollegiate athletics, bookstores,faculty.
are departmental research, and where housing, student apartments, guest houses,
agreed to,university research, chapels,theaters,public museums,and other
(1)Sponsored instruction and training means similar auxiliary enterprises. This definition
speoifio instructional or training activity es- also includes any other categories of activi-
tablished by grant, contract, or cooperative ties, costs of which are "unallowable" to
agreement. For purposes of the cost prin- Federal awards, unless otherwise indicated
ciples, this activity may be considered a in an award.
major function even though an institution's 2.Criteria for Distribution
accounting treatment may include it in the
instruction function. a. Base period. A base period for distribu-
(2) Departmental research means research, tion of indirect (F&A) costs is the period
development and scholarly activities that during which the costs are incurred. The
are not organized research and, con- base period normally should coincide with
sequently, are not deparately budgeted and the fiscal year established by the institution,
accounted for. Departmental research, for but in any event the base period should be so
purposes of this document, is not considered selected as to avoid inequities in the die-
as a major function,but as a part of the in- tribution of costs-
struction function of the institution, b. Need for cost groupings. The overall eb-
b. Organized research means all research jeotive of the indirect (F&A) cost allocation
and development activities of an institution process is to distribute the indirect (F&A)
that are separately budgeted and accounted costs described in Section B, Identification
for.It includes: and assignment of indirect (F&A) costs, to
OMB Guidance Pt. 200, App. HI
the major functions of the institution in pro- expenses, or operation and maintenance ex-
portions reasonably consistent with the na- penses to such activities should be accom-
ture and extent of their use of the Watitu- pushed through cost groupings which include
tion's resouroee. In order to achieve this ob- only that portion of central indirect (F&A)
jective, it may be necessary to provide for costs (such as for overall management)
selective distribution by establt bing sepa- which are properly allocable to such activi-
rate groupings of cost within one or more of ties.
the indirect (F&A) coat categories referred (6) If the institution elects to treat fringe
to in subsection B.l, Definition of Facilities benefits as indirect (F&A) charges, each
and Administration. In general, the cost costs should be set aside as a separate cost
groupings established within a category grouping for selective distribution to related
should constitute, in each ease, a pool of cost objectives.
those items of expense that are considered to (6)'rhe number of separate cost groupings
be of like nature in terms of their relative within a category should be held within
contribution to (or degree of remoteness practical limits. after taking into consider-
ation the particular cost objectives to which ation the materiality of the amounts in-
distribution is appropriate. Cost grcuPinilsl volved and the degree of precision attainable
general
should be established considering the general through less selective methods of distribu-
guides provided in subsection c of this sec,
Wm. Bach such pool or coat grouping should tika,
then be distributed Inilividually to the re- d. Selection of distribution method.
lated cost objectives, using the distribution (1) Actual conditions must be taken into
base or method moat appropriate in light of account In selecting the method or base to
the guidelines set forth in subsection d of be used in distributing individual cost
this section. groupings.The essential consideration in se-
c. General consideration on cost groupings. looting a base is that it be the one best suit-
The extent to which separate cost groupings ea for assigning the pool of costs to cost ob-
and selective distribution would be appro- jeotivee fA accordance with benefits derived;
priate at an institution is a matter of judg- with a traceable cause-and-effect relation-
ment to be determined on a case-by-ease ship; or with logic and reason, where neither
basis.Typical situations which may warrant benefit nor a cause-and-effect relationship is
the establishment of two or more separate determinable.
cost groupings (based on account clasaifica- (2) If a cost grouping can be identified di-
tion or analysis) within an indirect (F&A) reotly with the oost objective benefitted, it
coat category include but are not limited to should be assigned to that coat objective.
the following: (3) If the expenses in a cost grouping are
(1)If certain items or categories of expense more general in nature,the distribution may
relate solely to one of the major functions of be based on a cost analysis study which re-
the institution or to less than an functions, sulfa in an equitable distribution of the
such expenses should be set aside as a separ
rate cost grouping for direct assignment or costs. Such cost analysis studies may take
selective allocation in accordance with the into consideration weighting factors, popu-
guides provided in subsections b and d. lation,or space occupied if appropriate. Cost
(2)If any types of expense ordinarily treat- analysis studies,however,must(a)be appro-
ed as general administration or depart- priately documented in sufficient detail for
mental administration are charged to Fad- subsequent review by the cognizant agency
eral awards as direct costs,expenses applica- for indirect costs, (b) distribute the oasts to
ble to other activities of the institution the related coat objectives in accordance
when incurred for the same purposes in like with the relative benefits derived, (a)be eta-
circumstances must, through separate oost tistically sound,(d)be performed specifically
groupings, be excluded from the indirect at the institution at which the results are to.
(MA) costs allocable to those Federal be used,and(e)be reviewed periodically,but
awards and included in the direct cost of not less frequently than rate negotiations.
other activities for cost allocation purposes. updated if necessary, and used consistently.
(3)If it is determined that certain expenses Any assumptions made in the study must be
are for the support of a service unit or facil- stated and explained.. The use of cost anal-
ity whose output is susceptible of measure- yais studies and periodic changes in the
ment on a workload or other quantitative method of cost distribution must be fully
basis, such expenses should be set aside as a justified.
separate cost grouping for distribution on (4) If a cost analysis study is not per-
such basis to organized research, inetrac- formed.,or if the study does not result in an
tional,and other activities at the institution equitable distribution of the costs, the die-
or within the department. tribution must be made in accordance with
(4) If activities provide their own pus- the appropriate base cited in Section B,Iden-
chasing, personnel administration, building tifioation and assignment of indirect (F&A)
maintenance or similar service, the distribu- costs, unless one of the following conditions
tion of general administration and general is met:.
W
Pt. 200, App. in 2 CFR Ch. II (1-1-14 Edition)
(a)It can be demonstrated that the use of (1) Depreciation on buildings used exolu-
a different base would result in a more equi- lively in the conduct of a single function,
table allocation of the costs, or that a more and on capital improvements and equipment
readily available base would not increase the used in such buildings, must be assigned to
costs charged to Federal awards,or that function.
(b)The institution qualifies for, and elects (2)Depreciation on buildings used for more
to use, the simplified method for computing than one function, and on capital improve-
indirect (F&A) cost rates described in Sea- meats and equipment used in such buildings,
tion D, Simplified method for small instita- must be allocated to the individual functions
tions. performed in each building on the basis of
(6) Notwithstanding subsection (3), Wee- usable square feet of space, exoluding emo-
tive July 1,1998,a cost analysis or base other mon areas such as hallways, stairwells, and
than that in Section B must not be used to rest rooms.
distribute utility or student services costs. (9) Depreciation on buildings, capital irn
Instead, subsections B.4.o Operation and provements and equipment related to space
maintenance expenses, may be used in the (e.g., individual rooms, laboratories) used
recovery of utility costs. jointly by more than one function(as deter-
s.Order of distribution, mined by the users of the space) must be
(1)Indirect(F&A)costs are the broad cat- treated as follows. The cost of each jointly
egories of costs discussed in Section B.j., used unit of space must be allocated to bone-
Definitions of Facilities and Adminietratann fitting functions on the basis of:
(2) Depreciation, interest expenses, oper- (a) The employee full-time equivalents
ation and maintenance expenses,and general (riles) or salaries and wages of those indi-
administrative and general expenses should vidual functions benefitting from the use of
be allocated in that order to the remaining that space;or
indirect (F&A) cost categories as well as to (b)Institution-wide employee FT17s or sal-
the major functions and specialised service aries and wages applicable to the benefitting
facilities of the institution. Other cost oat- major functions (see Section A.1) of the in-
egories may be allocated in the order deter- sribution.
mined to be most appropriate by the institu- (4) Depreciation on certain capital im-
tions,When cross allocation of costs is made provements to land, such as paved parking
as provided in subsection(3), this order of al- areas,fences, sidewalks.and the like,not in-
location does not apply. oluded in the cost of buildings,must be allo-
(3) Normally an indirect (F&A) cost cat- sated to user categories of students and em-
egory will be considered closed once it has ployees on a full-time equivalent basis. The
been allocated to other cost objectives, and amount allocated to the student category
costs may not be subsequently allocated to must be assigned to the instruction function
it. However, a cross allocation of coats be- of the institution. The amount allocated to
tween two or more indirect (F&A)•cost oat- the employee category must be further alio-
egories may be used if such allocation win oated to'the major functions of the iastitu-
result in a more equitable allocation of tion in proportion to the salaries and wages
costs.If a cross allocation is used, an appro- of all employees applicable to those fano-
priate modification to the composition of tions.
the indirect (F&A) coat categories described
in Section B is required. 3. Interest
B.IDENTIFIOATION AND ASSIGNMENT OF Interest on debt associated with certain
INDIPIOT(F&A)NCOSTS buildings, equipment and capital improve-
ments, es defined in §200.449 Interest, must
1.Definition of Facilities and Administration be classified as an expenditure under the cat-
egorybe alto-
See §200.414 Indirect (F&A) costs which t in the ssame e msanner asthecoststdeprecia-
provides the basis for this indirect cost re- tion on the buildings, equipment and capital
quirements. improvements to which the interest relates.
2.Depreciation 4.Operation and Maintenance Expenses
a.The expenses under this heading are the a, The expenses under this heading are
portion of the costs of the institution's those that have been incurred for the arlmin-
buildings, capital improvements to land and istration, supervision, operation, mainte-
buildings, and equipment which are corn- nance,preservation,and protection of the M-
ooted in accordance with §200.436 Depreaia- etitution's physical plant. They include ex-
tion. penses normally incurred for such items as
b. in the absence of the alternatives pro- janitorial and utility services; repairs and
vided for in Section A.2.d, Selection of dis- ordinary or normal alterations of buildings,
tribution method, the expenses included in furniture and equipment; care of grounds;
this category must be allocated in the fol- maintenance and operation of buildings and
lowing manner: other plant facilities; security; earthquake
198
OMB Guidance Pt.200,App. III
and disaster preparedness; environmental 5.General Administration and General Expenses
safety; hazardous waste disposal; property, a. The expenses under this heading are
liability and all other insurance relating to those that have been incurred for the general
property; space and capital leasing; facility executive and administrative offices of edu-
plarnine and management; and central re- cational institutions and other expenses of a
calving. The °para on and maintenance ex- general character which do not relate solely
pease category should also include Its cello- to any major function of the institution;i.e.,
cable share of fringe benefit costs, deprecia- solely to (1) instruction, (2) organized re-
tion,and interest costs. search, (3) other sponsored activities, or (4)
b. In the absence of the alternatives pro- other institutional activities. The general
vided for in Section A.S.d, the expenses in- administration and general expense category
chided in this category must be allocated in should also include its allocable share of
the same manner as described in subsection fringe benefit costs, operation and mainte-
2.b for depreciation. nance expense, depreciation, and interest
a. A utility cost adjustment of up to 1.3 costs. Examples of general administration
percentage points may be included in the ne- and general expenses include: those expenses
gotiated indirect cost rate of the lEE for or- incurred by administrative offices that serve
ganized research,per the computation alter- the entire university system of which the in-
natives in paragraphs (c)(1) and (2) of this stitution Is a part; central offices of the in-
section: stitution such as the President's or
(1)Where space is devoted to a single fano- Chancellor's office, the offices for institu-
tion and metering allows unambiguous meets- tion-wide financial management, business
urement of usage related to that space,costs services, budget and planning, personnel
must be assigned to the function located in management, and safety and risk manage-
that space. ment;the office of the General Counsel;and
(2) Where space is allocated to differenttheoperations of the central administrative
functions and metering does not allow imam- management information systems. General
biguous measurement of usage by function, administration and general expenses must
costa must be allocated as follows: not include expenses incurred within non-
(i)Utilities costs should be apportioned to university--wide deans' offices, academic de-
partments,
functions in the same manner as deprecia- n a io organized units.research units,orf onsi 6,
tion, based on the calculated difference be- De' organizational {Bee. subsecton 6,
tween the site or building actual square foot- bDepartmental aj absenceadministration th on expenses.)es
pro-
age for monitored research laboratory space Ice the Section of the alternativesin(site, building, floor, or room), and a sepa- vided for thiss oo y mustu, the groupeds first
eluded in category be first
rate calculation prepared by the 1HE using according to common major functions of the
the "effective square footage" described in institution to which they render services or
subsection(c)(2)(ii)of this section. provide benefits. The aggregate expenses of
(ii-)"Effective square footage" allocated to each group must then be ailooated to serv-
research laboratory space must be calculated iced or benefited#unotione on the modified
as the actual square footage times the ref- total cost basis. Modified total costs consist
ative energy utilization index (REUI)posted of the same elements as those in Section 0.2,
on the OMB Web site at the time of a rate When an activity included in this indirect
determination. (F&A) cost category provides a service or
A. This index is the ratio of a laboratory product to another Institution or organize.-
energy use index (Iab EUD to the car- tion, an appropriate adjustment must be
responding index for overall average college made to either the expenses or the basis of
or university space(college EW). allocation or both, to assure a proper Qom-
B.In July 2012,values for these two indices tion of ooste.
(taken respectively " absrom the Lawrence 6.Departmental Administration Expenses
Berkeley Laboratory for the 21st Cen-
tury" benohmarking tool http:// a. The expenses under this heading are
1abs2Ibenchmarking.lbl.gov/CompareData.php those that have been incurred for adminia-
and the US Department of Energy '-`Build trative and supporting services that benefit
lags Energy Databook" and http:// common or joint departmental activities or
buildingsdatabook.eren.doe.gov/CEECS.aspx) objectives in academic deans' offices, ace-
were 310 kBtuisq ft-yr.and 155 kBtu/sq ft-yr., demic departments and divisions, and orga-
so that the adjustment ratio is 2.0 by this nized research units. Organized research
methodology, To retain currency, OMB will units include such units es institutes, study
adjust the HUI numbers from time to time centers,and research centers. Departmental
(no more often than annually nor less often administration expenses are subject to the
than every 5 years), using reliable and pub- following limitations.
Holy disclosed data. Current values of both (1) Academic deans' offices. Salaries and
the EUIs and the REUI will be posted on the operating expenses are limited to those at-
OMB Web site. tributable to administrative functions.
Pt.200, App. 111 2 CFR Ch. II (1-1-14 Edition)
(2)Academic departments. c. In the absence of the alternatives pro-
(a) Salaries and fringe benefits attrib- vided for in.Section A.2.d, the expenses in-
utable to the administrative work(including eluded in this category must be allocated as
bid and proposal preparation) of faculty(in- follows:
eluding department beads)and other praise- (1) The administrative expenses of the
atonal personnel conducting research and/or dean's office of each college and school must
instruction, must be allowed at a rate of 3.6 be allocated to the academic departments
percent of modified total direct oosts. This within that college or school on the modified
category does not include professional buss- total cost basis.
ness or professional administrative officers. (2) The administrative expenses of each
This allowance must be added to the corn- academic department, and the department's
potation of the indirect(F&A) cost rate for share of the exnensea allocated in subsection
major functions in Section 0,Determination (1)must be allooated to the appropriate nine-
and application of indirect (F&A) cost rate tions of the department on the modified
or rates; the expenses covered by the allow- total cost basis.
ante must be exoluded from the depart-
mental administration cost pool. No docu- 7.Sponsored Projects Administration
mentation is'required to support this allow- a. The expenses under this heading are lim-
amac' ited to those incurred by a separate organi-
(b) Other administrative and supporting zation(s)established primarily to administer
expenses incurred within academic depart- sponsored projects, including such functions
meats are allowable provided they are treat- as grant and contract administration (Fed-
ed consistently in like circumstances. This eral and non-Federal), special security, pur-
Would Inalitde ek ass strati ae the salaries chasing,personnel,administration,and edit-
of asorstatiinl and clerical Mafia the salaries ing and publishing of research and other re-
ef administrative officers and assistants, ports.They include the salaries and expenses
travel, office supplies, stockrooms, and the of the head of such organization, assistants,
like. and immediate staff, together with the sala-
(3) Other fringe benefit costs applicable to ries and expenses of personnel engaged in
the salaries and wages included in sub- supporting activities maintained by the or-
sections (1) and (2) are allowable, as well as ganization,such as stook rooms,print shops,
an appropriate share of general administra and the like. This category also includes an
tion and general expenses, operation and allocable share of fringe benefit costs, gen-
maintenance expenses,and depreciation. eral administration and general expenses,
(4) Federal agencies may authorize reim- operation and maintenance expenses,and de-
bursement of additional costs for department predation. Appropriate adjustments will be
heads and faculty only in exceptional oases made for services provided to other functions
where an institution can demonstrate undue or organizations,
hardship or detriment to project perform- b. In the absence of the alternatives pro-
vided for in Section A.2.d, the expenses tu-
b.The following guidelines apply to the de- eluded in this category must be allocated to
termination of departmental administrative the major functions of the institution under
costs as direct or indirect(F&A)costs, which the sponsored projects are conducted
(1)In developing the departmental admin- on the basis of the modified total cost of
istration cost pool,special care should be es- sponsored projecta
erased to ensure that costs incurred for the c. An appropriate adjustment must be
same purpose in like circumstances are made to eliminate any duplicate charges to
treated consistently as either direct or loth- Federal awards when this category includes
root (F&A) costs. For example, salaries of similar or identical activities as those in-
technical staff, laboratory supplies (e.g., eluded in the general administration and
ohemicals), telephone toll charges, animals, general expense category or other indirect
animal care costs, computer costs, travel (F&A) cost items, such as accounting, pro-
costs, and specialized shop costs must be cerement,or personnel administration.
treated as direct costs wherever identifiable
to a particular cost objective. Direct charg- 8.Library Expenses
ing of these costs may be accomplished a. The expenses under this heading are
through specific identification of individual those that have been incurred for the oper-
costa to benefiting cost objectives, or ation of the library, including the post of
through recharge centers or specialized serv- books and library materials purchased for
ice facilities, as appropriate under the cir- the library, less any items of library income
oumstances. See §§200.413 Direct costs, para- that qualify as applicable credits under
graph (o) and 200.468 Specialized service fa- §200.4Q6 Applicable credits. The library ex-
Unties. pease category should also include the fringe
(2) Items such as office supplies, postage, benefits applicable to the salaries and wages
local telephone coats,and memberships must included therein, an appropriate share of
normally be treated as indirect (F&A) costs. general administration and general expense,
200
OMB Guidance Pt. 200,App. Ill
operation and maintenance expense, and de- struotian function,and subsequently to Fed-
predation. Costa incurred in the purchases eral awards in that function.
of rare books (museum-type books) with no
value to Federal awards should not be allo- 10. Offset for Indirect (F&A) Expenses Other-
cated to them. wise Provided for by the Federal Govern-
b. In the absence of the alternatives pro- Mat
aided_ for in Section A.2.d, the expenses in. a. The items to be accumulated under this
eluded in this category must be allocated heading are the reimbursements and other
first on the basis of primary categories of payments from the Federal government
users, including students, professional em- which are made to the institution to support
ployees,and other users, solely,specifically,and directly,in whole or
(1) The student category must consist of in past,any of the administrative or service
full-time equivalent students enrolled at the activities described in subsections 2 through
institution, regardless of whether they earn B.
credits toward a degree or certificate. b. The items in this group must be treated
(2) The professional employee category as a credit to the affected individual indirect
must consist of all faculty members and (P&A) cost category before that category is
other professional employees of the institu- allocated to benefltting functions.
tion, on a full-time equivalent basis. This R'O
ION C.DETERMINATION AND APPLICATION
category may also include post-doctorate
fellows and graduate students. �Q,i,(F&A) BATE OR
(3) The other users category must consist I.Indirect(p'&,A)Qost pools
of a reasonable factor as determined by insti-
tutional records to account for all other a. a.)Subject to subsection b, the separate
users of library facilities. categories of indirect (F&A) costs allocated
c.Amount allocated in paragraph b of this to each major function of the institution as
section must be assigned father as follows: prescribed in paragraph B of this paragraph
(1) The amount in the student category 0.1 Identification and assignment of indirect
must be assigned to the instruction function (F&A)costs, must be aggregated and treated
of the institution.. as a common pool for that function. The
(2) The amount in the professional em- amount in each pool must be divided by the
ployee category must be assigned to the distribution base described in aubseotion 2 is
major functions of the institution in propor- arrive at a single indirect(F&A)cost rate for
tion to the salaries and wages of all faculty eaoh_funejdon,
members and other professional employees The rate for each function is used to
applicable to those functions. distribute indirect(F&A) costs to individual
(3)The amount in the other users category Federal awards of that function. Since a
must be assigned to the other institutional common pool is established for each major
activities function of the institution. function of the institution, a separate indi-
rect(F&&) cost rate would be established for
9.Student Administration and Services each of the major functions described in Sec-
a. The expenses under this heading are tion A..1 under which Federal awards are car-
those that have been incurred for the admin- ried out,
(3) Poch institution's indirect (F&A) cost
istration of student affairs and for services rate process must be appropriately designed
to students, including expenses of such ac- to ensure that Federal sponsors do not in
tivities as deans of students,admissions,rag- any way subsidize the indirect(F&A)costs of
istrar, counseling and placement services, other sponsors, specifically activities spon-
student advisers, student health and infix- cored by industry and foreign governments.
mary services, catalogs, and commence- Accordingly, each allocation method used to
mente and convocations. The salaries of identify find allocate the indirect(Fdi.P.)cost
members of the academic staff whose respon- pools, as described in Sections A.2. Criteria
sibilities to the institution require adminie- for distribution, and B2 through B.9, must
trative work that benefits sponsored projects contain the full amount of the institution's
may also be included to the extent that the modified total costs or other appropriate
portion charged to student administration is units of measurement used to make the com-
determined in accordance with Subpart l- potations. In addition, the final rate dis-
Cost Principles of this Part. This expense tribution base(as defined in subsection 2)for
category also includes the fringe benefit each major function (organized research,in-
costs applicable to the salaries and wages in- struction, etc., as described in Section A.1,
chided therein, an appropriate share of gen- Major functions of an institution)must con-
eral administration and general expenses, twin all the programs or activities which uti-
operation and maintenance, interest ex- line the indirect (F&A) costs allocated to
penile,and depreciation. that major function. At the time an indirect
b. In the absence of the alternatives pro- (F&A) cost proposal is submitted to a cog-
vided for in Section A.2.d, the expenses in nizant agency for indirect costs, each insti-
this category must be allocated to the in- talon must describe the process it uses to
4
Pt.200, App. III 2 CFR Ch.II (1-1-14 Edition)
ensure that Federal funds are not used to 3.Negotiated Lump Sum for Indirect(F&A)
subsidize industry and foreign government Costs
funded programs.
b. In some instances a single rate basis for A negotiated fixed amount lu lieu of lndi-
Ltab across the board on all workt wsisn a red(F&A)costs may be appropriate for self-
major function at an institution maynot be contained, off-campus, or primarily suboon-
traded activities where the benefits derived
appropriate. A single rate for research, for from an institution's indirect(F&A)services
example, might not take into account those cannot be readily determined. Such nego-
different environmental factors and other tinted indirect(F&A)oasts will be treated as
conditions which may affect substantially an offset before allocation to instruction,or-
the indirect(F&A)costs applioable to a par- ganized researoh,.other sponsored activities,
tioular segment of research at the institu- and other institutional activities. The base
tion. A particular segment of research may on which such remaining expenses are ado-
be that performed under a single sponsored sated should be appropriately adjusted.
agreement or it may consist of research 4 Predetermined Rates for Indirect(F&A)Costs
under a group of Federal awards performed
in a common environment. The environ- Pubjic Ltaw 87 638(76 Stat. 437)as amended
mental factors are not limited to the phys- (41 U.S.C. 4708) authorizes the use of pre-
ioal location of the work. Other important determined rates in determining the "indi-
factors are the level of the administrative rest costs" (indirect (F&A) costs)applicable
support required, the nature of the facilities under research agreements with educational
or other resources employed, the scientific institutions.The stated objectives of the law
disciplines or technical skills involved, the to simplify the adminis ration of cost-
organizational arrangements used, or any type research and development contracts(in-
hombinatfan thereof. If a particular segment chiding grants) with educational institu-
of a sponsored agreement is performed with- biome' to, and,facilitateothe t or ex of theirexpeditious
in an environment which appears to generate closeou' and to permt morehehe rk i
a significantly different level of indirect closeout of such contractswofth when the work is
(F&A)costs,provisions should be made for a completed. do view of the potential negotiation
separate indirect (F&A) cost pool applicable ofgr offered predeterminedby this esofo in negotiation
to such work. The se arate indirect of costsapeiod fr two for four
indirect could
p ��) for a period of two to four years should
cost pool should be developed during the reg- be the norm in those situations where the
ular course of the rate determination process cost experience and other pertinent facts
and the separate indirect(F&A)cost rate re- available are deemed sufficient to enable the
suiting therefrom should be utilized; pro- parties involved to reach an informed judg-
vided it is determined that (1) such indirect merit as to the probable level of indirect
(F&A) cost rate differs significantly from (F&A) costs during the ensuing accounting
that which would have been obtained_under periods.
subsection a, and (2) the volume of work to
which such rate would apply is material in 5.Negotiated Foxed Rates and Carry-Forward
relation to other Federal awards at the insti- Provisions
tution. When a fixed rate is negotiated in advance
for a fiscal year (or other time period), the
2. The Distribution Basis over-or under-recovery for that year may be
Indirect(F&A)costs must be distributed to included as an adjustment to the indirect
applicable Federal awards and other benefit- When host for negotiatedee next rate netheiatiry-
ting activities within each major function When d the rate is determined,the carry-
(see section Al, Major functions of an insti- forward adjustment mayiseapeto the carry-
(see
tution) on the basis of modified total direct forward amount negotiation.
go be applied o thec nad-
coats (MTDC), consisting of all salaries and jsubsequent rate bee made,each fiWhxed
such ne-
wages, fringe benefits, materials and sup- g tinted i are o advance made, period rate nee
plies,services, travel,and subgrants and sub- compute in byalying for a e given will be
contracts up to the first $26,000 of each (F&Aated allocable the expectedFederalawardsindror
subaward (regardless of the period covered thec forecast code pluserid minusi for
by the subaward). MTDC is defined in 20p.68 the period (over-or or the overy)
� forward adjustment or under-recovery)
Modified Total Direct Cost(MTDC). For this from the prior period, to the forecast die-
purpose, an indirect (F&A) cost rate should tribution base. Unrecovered amounts under
be determined for each of the separate Lodi- lump-awn agreements or cost-sharing provi-
rect (F&A) cost pools developed pursuant to scone of prior years must not be carried for-
subsection 1. The rate in each case should be ward for consideration in the new rate nego-
stated as the percentage which the amount tiation.There must, however, be an advance
of the particular indirect (F&A) cost pool is understanding in each case between the in-
of the modified total direct costs identified stibution and the cognizant agency for indi-
with such pool. rect ooete as to whether these differences
20'2
OMB Guidance Pt.200,App. III
will be considered in the rate negotiation Federal government at the time of an award
rather than making the determination after (because the educational institution is a new
the differences are known. Further, institu- recipient or the parties cannot reach agree-
tions electing to Use this carry-forward pro- merit on a rate),the provisional rate used at
vision may not subsequently change without the time of the award must be adjusted once
prior approval of the cognizant agenoy for a rate is negotiated and approved by the cog-
indirect costs. In the event that an institu nizant agency for indirect costs.
tion returns to a post-determined rate, any
over-or under-recovery during the period in 8.Limitation on Reimbursement of
which negotiated fixed rates and oarry-for- Administrative Costs
ward provisions were followed will be in-
cluded in the subsequent poet-determined a. Notwithstanding the provisions of sub
rates. Where multiple rates are Used, the section O.1.a, the administrative costs
same procedure will be applicable for deter- charged to Federal awards awarded or
mining each rate, amended (including continuation and. re-
6.Provisional and Anal Rates far Indirect newal awards)with effective dates beginning
(F&A) on or after the start of the institutions first
Costs
fiscal year which begins on or after October
Where the cognizant agency for indirect 1, 1991, must be limited to % of modified
costs determines that cost experience and total direct costs(as defined in subsection 2)
other pertinent facts do not justify the use for the total of General Administration and
of predetermined rates, or a fixed rate with General Expenses, Departmental Adminie-
a carry-forward, or if the parties cannot tration, Sponsored Projects.Administration,
agree on an equitable rate,a provisional rate and Student Administration and Services
must be established. To prevent substantial (including their allocable share of deprecia
overpayment or underpayment, the provi- tion, interest costs, operation and mainte-
sional rate may be adjusted by the cognizant name expenses, and fringe benefits posts, as
agency for indirect costs during the inatitu- provided by Section B,Identification and as-
times fiscal year. Predetermined or fixed signment of indirect (F&A) costs, and all
rates may replace provisional rates at any other types of expenditures not listed ape-
time prior to the close of the institution's cificaily wader one of the subcategories of fiscal year. If a provisional rate is not re- a_ilities inleetion)3.
fa-
placed by a predetermined or fixed rate prior b. Institutions should not change their ac-
to the end of the institution's fiscal year, a hang
finsm.1 rate will be established and upward or counting or cost allocation methods if the ef-
downward adjustments will be made based on feat is to change the charging of a particular
the actual allowable costs incurred for the type of cost from F&4,to direct,or to reales-
period involved, Mfg costs, or increase allocations from the
administrative pools identified in paragraph
7.Fixed Rates for the Life of the Sponsored B.1 of this Appensiig to the other F&A cost
'fit pools or fringe benefits. Cognizant agencies
Federal agencies must use the negotiated for indirect cost are authorized to allow
rates except as provided in paragraph (e) of changes where an institution's charging
§200.414 Indirect (F&A) costs. must pars- pra.otioes are at variance with acceptable
graph(b)(1)for indirect(F&A) costs in effect practices followed by a substantial majority
at the time of the initial award throughout of other institutions.
the life of the Federal award. Award levels
for Federal awards may not be adjusted in 9.Alternative Method for Administrative Costs
#uture years as a result of changes in nego- a. Notwithstanding the provisions of sub-
tinted rates. "Negotiated rates" per the rate section I.a,,an institution may elect to claim
agreement include final, fixed, and predeter- a fixed allowance for the "Administration"
mined rates and exclude provisional rates, portion of indirect (F&A) costs. The allow-
,`Life" for the purpose of this subsection aUce could be either 24%of modified total di-
means each competitive segment of a
project.A competitive segment is a period of rent costa or a percentage equal to 95%of the
years approved by the Federal awarding most recently negotiated fixed or predeter-
agency at the time of the Federal award. 7f mined rats for the cost pools included under
negotiated rate agreements do not extend `Administration" as defined in Section B1,
through the life of the Federal award at the whichever is less. Under this alternative, no
time of the initial award, then the nego- cost proposal need be prepared for the "Ad-
tiated rate for the last year of the Federal ministration" portion of the indirect (F&A)
award must be extended through the end of cost rate nor is further identification or doc-
the life of the Federal award. umentation of these costs required(see sub-
b. Except as provided in §200.414 Indirect section c). Where a negotiated indirect
(F&A)costs,when an educational institution (F&A) coat agreement includes this alter-
does not have a negotiated rate with the native,an institution must make no further
2Q
Pt.200, App. III 2 CFR Ch. II (1-1-14 Edition)
charges for the expenditure categories de- aided based on mutual agreement between
soribed ip Section B.6, General administra- HHS end DOD,
tit= and Mend Mamma Section R.e,, De- Altar eognizaatoe is erne blfeshed,it muat
Ia rtmedtdl adininiattea'ti9n ammo, Sectinta continue f r a liv'ea-pa r period:
H.� anana aed pr,JeeIa atdt trinin naiddla and b« Aocenteneti Of rat See $2111414 Ith
Se Lion B, , Student administration and reet(F,a+inoete.
teritiese. o. Otirreating deft (lea. The COMO=
b. In negotatione of rates for subteen/ant agency for indirect oetetel must negotiate
periodic a iliatttatles that has elected the . in.ema needed to oaaxet systems dell-
ojetiOn c+r entb®ect an a Mee anietinue to metre eleactia misting be anoceintatallty for Fad-
den
tt at the enaaie rim althea fib i - ersi /moods, Ccadstrat kootuj a tar ihdiaeet
thesis.or deoum,eateeicri of oast& cacaos nut address elite enorairee of other e
ra. IL as institatne elects to aoeep6 a faded affneeisei,as vpentestea.asd.nsast ne-
th Esbadid rate as veil lit tlhibeecthni a of gatbato swim rates for Federal agen d as
t�seattoxi, It is not eminent to lya3,A that Anate de ixilea mania of 1 .adimluleit tine oaate« race soot t steins.
newt re-weepy or i5ed1-
a 6 9t® orrder tu ie p #s� the a c . la ving q d costs. ong-
its t ) oust rate, aunt deanor for 9ndir mI caste rns m-
ine xna tatton mutt reonrile its fertirent du .maeisaaryneotiatiouswithseedu-
woo rat proposal to Its ,ftlemoiai. Maio- aattinka unclad old regard=ardadnta cites-
Mentn and :male allerenidalte adineetmna a timed by mitt th t&re due the mew tow-
and,teedasatflcatieas to illentLfy the wale of ern; related:to costa revered by a nego-
each mate!' DU on as erase in Section gated Attigazdeat,.
A.l as well as tti idnatiifg and aP9,nrste the fh
oiliitles cn I dstHteltrs costs 8P ga fne wroovsaetm�i figt
that are not!den lad,a saes the bald- i ®at apFatmr sa ft i-e Ltd E4 91 by
tattletale ar a isaanti a�rat as 5 S ld performed ulnae i Part maw l,s a by
unread in a c t tts) will b h2lit g > +
oiensifi eel as 5 3� el mate fur pet ee� A oto_ f n�ci�aimg in,��gp fz Prpeedi>��4r��, mimed and�oo
�F oast pea osale wiraiii t rates must lie ertablialied by
a fin ai egal state s .lam n and allacaftg i),L- MBn!thB following Wig:
tics mete (I) Formal nag tledem. The negnitant
11) Individual Rate Components agency for iedareot costs is responsible for
negotiating and approving rates for an edu-
In order to provide mutually agreed-upon oational institution on behalf of all Federal
information for management purposes, each agencies.Non-cognizant Federal agencies for
indirect (F&A) cost rate negotiation or de- indirect oasts, which make Federal awards
termination shall include development of a to an educational institution, must notify
rate for each indirect(F&A)cost pool as well the cognizant agency for indirect costs of
as the overall indirect(F&A)cost rate. apeeific concerns (i.e., a need to establish
II.Negotiation and Approval of Indirect(F&A) special cost rates)which could affect the ne-
Rara gotiation process. The cognizant agency for
indirect costs mast address the concerns of
a. Cognizant agency for indirect costs is all interested agencies, as appropriate. A
defined in Subpart A Acronyms and Defini- pre-negotiation conference may be scheduled
tone. among all interested amides, if necessary.
(1) Coat negotiation cognizance is assigned The cognizant agency for indirect costs must
to the Department of Health and Human then arrange a. negotiation conference with
Services (HIS) or the Department of De- the educational institution.
fence's Office of Naval Research (DOD), nor- (2)Other than formal negotiation.The cog-
really depending on which of the two agen- nizant agency for indirect costs and edu-
cies (HHS or DOD) provides more funds to aatlonal institution may reach an agreement
the educational institution for the most re- on rates without a formal negotiation con-
cent three years. Information on binding ference; for example, through correspond-
must be derived from relevant data gathered once or use of the simplified method de-
by the National Science Foundation.In cases scribed in this section D of this Appendix.
where neither FRS nor DOD provides Fed- g. Formai-Meg determinations and agree-
eral funding to an educational institution. ments. The cogniizant agency for indirect
the cognizant agency for indirect coats as- costs must formalize all determinations or
signment must default to HES. Notwith- agreements reached with an educational in-
standing the method for cognizance deter- stitution and provide copies to other agen-
mination described in this section, other ar- cies having an interest. Determinations
rangements for cognizance of a particular should include a description of any adjust-
educational institution may also be based in ments, the actual amount, both dollar and
part on the types of research performed at percentage adjusted, and the reason for mak-
the educational institution and must be de- ing adjustments,
OMB Guidance Pt. 200, App. III
h. Disputes and disagreements. Where the are reeesified under the following titles or
cognizant agency for indirect costs is unable their equivalents:
to reach agreement with an educational in- (1) General administration and general ex-
stitution with regard to rates or audit reso- penes(exclusive of costs of student adminis-
lution, the appeal system of the cognizant tration and services, student activities,stu-
agency for indirect oasts must be followed dent aid,and scholarships).
for resolution of the disagreement. (2) Operation and maintenance of physical
plant and depreciation(after appropriate ad-
/2.Standard Format for Submission Justment for costs applicable to other insti-
tutionalFor faoilities and administrative (indirect ib activities).
(F&A)) rate proposals, educational institu- (4)Lib
))LLibrary.
tions must use the standard format, shown (i Department4) becomputed as
pen nt expenses,of the
in section E of this appendix,to submit their which will be a t►eroent d the
salaries and expenses of deans and heads of
indirect (F&A) rate proposal to the cog- departments.
nizant agency for indirect costs. The cog- In those eases where expenditures classi-
nizant agency for indirect costs may, on an fled under subsection (1) have previously
institution-by-institution basis,grant exoep- been allocated to other institutional aotivi-
tions from all or portions of Part II of the ties, they may be included in the indirect
standard format requirement. This require- (F&A) cost pool. The total amount of sala-
ment does not apply to educational inetitu rise and wages included in the indirect(F&A)
tions that use the simplified method for cal- cost pool must be separately identified,
oulating indirect(F&A)rates,as described in o.Establish a salary and wage distribution
Section D of this Appendix, base,determined by deducting from the total
In order to provide mutually agreed upon of salaries and wages as established in sub-
information for management purposes, each section a. from the amount of salaries and
F&A cost rate negotiation or determination wages included under subsection b.
must include development of a rate for each d. Establish the indirect (F&A) cost rate,
F&A cost pool as well as the overall F&A determined by dividing the amount in the in-
rate, direct(F&A) cost pool, subsection b, by the
amount of the distribution base, subsection
D. SIMPLIFIED METHOD FOR SMALL 0,
IrIStIrulaONS e.Apply the indirect(F&A)cost rate to di-
rect salaries and wages for individual agree-
1.General manta to determine the amount of indirect
a.Where the total direct cost of work cov- (F&A)costs allocable to such agreements.
ered by this Part at an institution does not 3.Simplified Procedure—Modified Total Direct
exceed $10 million in a fiscal year, the aim- Oast Base
piffled procedure described in subsections 2
or 3 may be used in determining allowable a.Establish the total costs incurred by the
indirect (F&A) costs. Under this eimplified institution for the bane period.
procedure, the institution's most recent an- b. Establish an indirect (F& ) cost pool
nnal financial report and immediately avail- consisting of the expenditures (exclusive of
able supporting information must be utilised capital items and other costs specifically
as a basis for determining the indirect(F&A) identified as unallowable)which customarily
cost rate applicable to all Federal awards. are classified under the following titles or
The institution may use either the salaries their equivalents:
and wages (see subsection 2) or modified (1) General administration and general ex-
total direct costa (see subsection 3) se the pewee(exclusive of costs of student adminis-
distribution basis. tration and services, student activities, stu-
b. The simplified procedure should not be dent aid,and scholarshhps).
used where it produces results which appear (2) Operation and maintenance of physical
inequitable to the Federal government or the plant and depreciation (after appropriate ad-
institution. In any such case, indirect (F&A) 7ueterent for costs applicable to other inati-
costa should be determined through use of tutional activities).
the regular procedure. (8)Library.
(4) Department administration expenses,
2.Simplified Procedure—Salaries and Wages which will be computed as 20 percent of the
Base salaries and expenses of deans and heads of
departments. In those oases where expendi-
a. Establish the total amount of salaries tures classified under subsection (1) have
and wages paid to all employees of the insti- previously been allocated to other institu-
tution. tional activities,they may be included in the
b. Establish an indirect (F&A) cost pool indirect (F&A)cost pool. The modified total
consisting of the expenditures (exclusive of direct costs amount included in the indirect
capital items and other costs speciffically (F&A) cost pool must be separately identi-
identified as unallowable)which customarily fled.
5
Pt. 200, App. IV 2 CFR Ch. 11 (1-1-14 EditIon)
a. Establish a modified total direct cost rates in accordance with the requirements of
distribution base, as defined in Section C.2, this section, the Federal government must
The distribution basis, that consists of all unilaterally establish such rates. Such rates
institution's direct functions, may be based upon audited historical data or
d. Establish the indirect (F&A) cost rate, each other data that have been furnished to
determined by dividing the amount in the in- the cognisant agency for indirect costs and
direct (F&A) cost pool, subsection b, by the for which it can be demonstrated that all un-
amount of the distribution base, subsection allowable costs have been excluded.When ro-
am direct (F&A) cost rates are unilaterally es-
e. Apply the indirect (F&A) cost rate to tablished by the Federal government because
the modified total direct costs for individual of failure of the institution to submit a cer-
agreements to determine the amount of indi- tified proposal for establishing such rates in
met (F&A) costs allocable to such agree- accordance with this section, the rates es-
meats. tablished will be set at a level low enough to
E.DOCUMENTATION REQUIREMENTS Will
that potentially unallowable costs
will not be reimbursed.
The standard format for documentation re- c. Certificate. The certificate required by
quirements for indireot(indirect(F&A))rate this section must he in the following form:
proposals for ouaiming costs under the reg-
ular method is available on the 0MB Web CnRTIF'ICATE OF INDIRECT(F&A)COSTS
site here: h.ttp://www.whitehouse.gov/omb/ This is to certify that to the beat of my
grants jorms. knowledge and belief:
F. CERTIFICATION (1)I have reviewed the indirect(F&A)cost
Proposal submitted herewith;
1.Certification of Charges (2)All coats included in this proposal[iden-
tify date] to establish billing or final indi-
apenditures for Federal reot (F&A) costs rate for [identify period
awards are proper and in accordance with covered by rate] are allowable in accordance
the agreement documents and approved with the requirements of the Federal agree-
project budgets, the annual and/or final fie- ment(s) to which they apply and with the
cal reports or voaohers requesting payment oast principles applicable to those agree-
under the agreements will include a oertifi- manta.
cation, signed by an authorized official of (3)This proposal does not include any costs
the university, which reads "By signing this which are unallowable under applicable cost
report,I certify to the best of my knowledge principles such as(without limitation): pub-
and belief that the report is true, complete, lic relations costs, contributions and done-
and accurate,and the expenditures,disburse- tions, entertainment costs, fines and pen-
ments and cash receipts are for the purposes alties, lobbying costs, and defense of fraud
and intent set forth in the award documents. proceedings;and
I am aware that any false, fictitious, or (4) All costs included in this proposal are
fraudulent information, or the omiseion of properly allocable to Federal agreements on
any material fact, may subject me to orimi- the basis of a beneficial or causal relation-
al, civil or administrative penalties for ship between the expenses incurred and the
fraud, false statements, false dims or oth- agreements to which they are allocated in
erwise. (U.S. Code, Title 18, Section 1Q01 and accordance with applicable requirements.
Title 31,Sections 3729-3433 and 3801-3812)', I declare that the foregoing is true and cor-
2. Certification of Indirect(F&A)Costs meet.
a. Policy. Cognizant agencies must not ac- Institution of Higher Education:
cept a proposed indirect cost rate must un- ignature:N
less such costs have been certified by the Name of Official:
educational institution usingTitle:
the Certificate Date
of Execution:
of indirect (F&A) Costs set forth in sub-
section F.2.c APPIg W TO PART 200—INDIRECT
b.The certificate must be signed on behalf
of the institution by the chief financial offi-
cer (F&A) COSTS IDENTIFICATION AND
or an individual designated by an indi- A8SIGNMENT, AND RATE Dl;r> tMII4A-
vidual at a level no lower than vice president TION FOR NONPROFIT OR(IANIZA-
or ohief financial officer. TIONS
(1) No indirect (F&A) cost rate must be
binding upon the Federal government if the A.GENERAL
most recent required proposal from the insti- 1. Indirect costs are those that have been
tution has not been certified. Where it is incurred for common or joint objectives and
necessary to establish indirect (F&A) cost cannot be readily identified with a par-
rates, and the institution has not submitted ticular final cost objective. Direct cost of
a certified proposal for establishing such minor amounts may be treated as indirect
OMB Guidance Pt. 200, App. IV
costs under the conditions described in rating the organization's total costs for the
*200.413 Direct costs paragraph (d) of this base period as either direct or indirect, and
Part. After direct costs have been deter- (ii) dividing the total allowable indirect
mined and assigned directly to awards or costs (net of applicable credits) by an equi-
other work as appropriate,indirect costs are table distribution base. The result of this
those remaining to be allocated to benefit- process is an indirect cost rate which is used
tine*cost objectives.A cost may not be cello- to distribute indirect costa to individual
Gated to a Federal award as an indirect cost Federal awards.The rate should be expressed
if any other cost incurred for the same pur- as the percentage which the total amount of
pose, in like oiroumstanaes, has been as- allowable indirect costs bears to the base se-
signed to a Federal award as a direct cost. leoted. This method should also be used
"Major nonprofit organizations" are de- where an organization has only one major
fined in§200.414 Indirect(FQ&A)costs. See in- function encompassing a number of indi-
direct cost rate reporting requirements in vidual projects or activities, and may be
sections B.2.e and B.3.g of this Appendix. , used where the level of Federal awards to an
B.ALLOOATION OF INDIRECT COSTS AND organization is relatively email.
DETERMIPiATION of INDIUM Coal ltnTss b. Both the direct costs and the indirect
costs must exclude capital expenditures and
1.General unallowable costs. However, unallowable
a. If a nonprofit organization has only one costs which represent activities must be condi-
majorin-
function, or where ll Its major fuac- tichided is the direct costs under the tioaa benefit from its indirect costs to cep graph
s described in§2U0.413 Direct costs,para-
proximately the same degree; the allocation gr . ' e distributionf is Perot.
of indirect costs and the computation of an rect
(excluding base may be total dais
indirect cost rate may be accomplished there l - capital expenditures
through simplified allocation procedures, as and other distorting items,ore),contracts directea sr
described in section B.2 of this Appendix. r and wages,for $or other
or base whichmore is in
b. If an organization has several major ries and other results to
functions which benefit from its indirect an equitable distribution. The distribution
costs in varying degrees, allocation of indi- base mast exclude participant support costs
tact costs may require the accumulation of as defined in §200.45 Participant support
such costs into separate cost groupings costs.
which then are allocated individually to ben- d Except where a special rate(s) is re-
efitting functions by means of a base which gaited inaccordance with section B.5 of this
best measures the relative degree of benefit. Appendix, the indirect cost rate developed
The indirect coats allocated to each function under the above principles is applicable to
are• then distributed to individual Federal all Federal awards of the organization. If a
awards and other activities included in that special rate(s)is required, appropriate modi-
fuaction by means of an indirect cost rate(s). fioatione must be made in order to develop
c. The determination of what constitutes the special rate(s),
an organization's major functions will de- e. For an organization that receives more
pend on its purpose in being; the types of than Slit million in Federal funding of direct
services it renders to the public. its clients, costs in a fiscal year, a breakout of the indi-
and its members;and the amount of effort it rest cost component into two broad oat-
devotes to such activities as fundraising, egories, Facilities and Administration as de-
public information and membership activi- fined in section A.3 of this Appendix, Is re-
ties. wired.The rate in each case must be stated
d. Specific methods for allocating indirect as the percentage which the amount of the
ooets and computing indirect cost rates particular indirect cost category(i.e.,Facili-
along with the conditions under which each ties or Administration)is of the distribution
method should be used are described in see- base identified with that category.
tion/3.2 through B.5 of this Appendix.
e.The base period for the allocation of in. 3.Multiple Allocation Base Method
direct costs is the period in which such costs a. General. Where an orger ization's indi-
are incurred and accumulated for allocation root costs benefit its major functions in
to work performed is that period. The base varying degrees,indirect costs must be accu-
period normally should coincide with the or- mutated into separate cost groupings, as de-
ganization s fiscal year but, in any event. scribed in subparagraph b. Bach grouping
must be so selected as to avoid inequities in must then be allocated individually to bane-
the allocation of the costs. fitting functions by means of a base which
2.Simplified Allocation Method beat measures the relative benefits. The de-
fault allocation bases by coat pool are de-
a.Where an organization's major functions scribed in section 13.3.o of this Appendix..
benefit from its indirect costs to approxi- b. Identification of indirect costs. Cost
mately the same degree, the allocation of in- groupings must be established so as to per-
direct costs may be accomplished by(i)sepa- mit the allocation of each grouping on the
207
Pt, 200, App. IV 2 CFR Ch. II (1-1-14 Edition)
tasz a! bstitifitm presided in the t r font- cervices mete Annette Treat leg direct ousts
Ogee, Each griMninit zninst tainktNnste a Pool wherawr ithintifiable to a particular Mu-
e
ulaPneM that aro of like character in Eras, The ealavies.and wens ad and_ matte,
rem Cr e'ansnlwaso r.h 'nenent and I srm tive and pooled elerptnal staff ehCrl ncr-
nf the allona6loae ham which beet [billy 41 treated aq lod±egr orate; Direct
. rele,t rru benefits prey a' ad to anrr_h foam.
Glad 'Z�. charging of these Was n �app=,pElalsf
spina i�'o as Within the stem a major Prbjact rar satiny egapllot Ciao breed ca e ate``Fsdipi.'lier and 'M- molten en and budging far Mot eliva or n istMtlen,,ug rdensifbed ire AsaUita, .A.A of clerical servicen .al tether imialielduitoati S ikorendix,The Marmot cost pante Mini de- lenivert ban be Identified with the program or
Elated 5 fclace- aowrity. i toh as licst-
(l.) Depreciation. The expenses under this ago, IOW telephoto coati% neriadidela and
heading are the portion of the costs of the he> ueelid fly he treated as
organization's buildings, capital improve- tadirecit9iite,
ments to land and buildings, and equipment c. Allociesien purse. Aetna], oondiiti es
which are computed in accordance with tisaet ba tales into acablint ion selecting the
§200.496 Depreciation. . base.to be need inelineating the eapeasec lin(3) Interest. Interest on debt associated each aTtObsgto benenttling tooar.,ti . The
with certain buildings, equipment and cap- amendial conalderiGien in select 's.method
ital improvements are computed in accord- or a bee is tl;at'ii Is the hebeg staid for
once with§200.449 Interest. the pu,al of ceete-8n objectives
(9) Eventing smut Main±missiee turposeee. to a with heoeft dartirest a Moe-
-The drxitanial UAW this heeding aro those able wine and Baia
e t have been ina tnd for the a ie;Gc�w= s_nerelaither
came
gte
end eery. vat n�jt�h�'1�t nor the
aparattet, maintenai e; prcauTatten, ante Lit the t imp►ias p ba detemitacle.and riecchaotittib of the eltdi idmtitie'e phid'steal When en sib on. aign be mile dui=Tlaan�, MEW hnaillit i expences eureudly iA= Milt of a OM
Warted.for sum item_9 .3emat n and ail- �,,e�,ry��,�,,,,,,p 6� 'l$F a the Fie-
d. s17t'`4'i�.q,; Yo �49.+�""�+�!a5r k�@ ����$�$�+�II�T$aa`i,�I'�
peite or norm its than nen the swami in a not
alMratione of buildings,hei it sin and:efell igniniednd ar19.6 usre ernarsl
catint4 the
lii t s Of fay t and op- ler i led urn be rat w autitesit our liar ofera
note cxt hOldimpa end other p iini eslueind ban#harlL mama gee raeuh4 that,ace teem seturit- eartlitrainke and dlesatei lire* etlaitablet to tut to Federal ernmeat,
iamdiieaa, ac trlat tat safety: hazardous and the o iA# , The Okras/tide lit
wee oset: moody, Hanna and utter be its be accordance with the haws de,-latarance rnktisg to arepertY1 ® Qend scribed
herein
txe eeee o csits ias facitv r � n.arthat �g �a '6Qemt�4 would gnat
ages xt; and central. agesteing. The opsr• It a Men eqtaltable allocai .of the neat,
atlas and maiiitetienne eaipBee category or that a•merit
o t
most also Monde its i in sham of afile�hle d a al
�t pn the �arg+ed, Go �ed�rai,
fringe benefit costs, deprociatiebr and toter- amide, results of s is ial. coat studies
eat+nat&
s(4o a esssl d lstltalx�tian mad (ouch en engineeringntUtty studya�mutt
pees. The e._ general ex-. act be need to dotes al ate the fn-
under•this Intuiting are direntcogin ho Federal Mize&
cues tli n t have been i t rect.Sat the omen (l) r titm, .pepratieetot
mend atecnt'4'e and: i %trattvo ia�leee. Iles
of crr be aTla'Caaal la the ta+Yli�i�g oily¢;
stirsin end other menses'of a (a) Dep solatian an immure used exolu-
inaral natars which do not E Mate spisly to aivet3 In. the Coal= Of a dingle fu¢nutioar
any nn► rip function of the a asd itia ..This and an mitten impratinkaine and p ne t
category meat aln Waldo its allnc weed in e b : ice• suet be u sed
sh to are of tribes benefit to o- t e iGe and Mist amnion.
"141-1qt banes a erase, darliKtiarrdon, and in- (b)Depreciation on buildings used for more
0et now, gogiudilies of � aSteigereris than ope ilrnction, and on capital improve-
chide mittni MUM, .Minh as the director's manta and equipment used in sea bntbiings,
r irtoe, the talc* of finance, bees sere- must be allocated to the individual functions
lode, budget dud planning, personnel, safety performed in each building on the basis of
and risk management mama!emniseir - usable square feet of space, excluding corn-
apetnent information s; and Uhres7 mon areas, such as hallways, stairwells, and
costs, restrooms.
In developing this oast pool, special care (c) Depreciation on buildings, capital im-
should be exercised to ensure that posts in- provements and equipment related space
curred for the same purpose in like sir- (e.g., individual rooms, and laboratories)
cumstanoes are treated consistently as ei- used jointly by more than one function (as
ther direct or indirect costs. For example. determined by the users of the space) must
salaries of technical staff, project supplies, be treated as follows. The cost of each Joint-
project publication, telephone toll charges, ly used unit of space must be allocated to
computer costs, travel oasts, and specialized the benefitting functione on the basis of:
OMB Guidance Pt.200, App. IV
(I)the employees and other users on a full- common pool for that funotion. The costs in
time equivalent (FTE) basis or salaries and the common pool must then be distributed to
wages of those individual functions benefit- individual Federal awards included in that
ting from the use of that space;or function by use of a single indirect cost rate.
(ii) organization-wide employee FTEs or f. Distribution basis. Indirect costs must
salaries and wages applicable to the benefit- be distributed to applicable Federal awards
tang functions of the organization. and other benefitting activities within each
(d) Depreciation on certain capital im- major function on the basis of MTDC (see
provements to land, such as paved parking definition in §200.68 Modified Total Direct
areas,fences,sidewalks,and the like,not In- Coat(MTDO)of Part 200.
eluded in the cost of buildings,must be alio- g. Individual Rate Components. An indi-
cated to user categories an a 1TE basis and rest oast rate must be determined for each
distributed to major funotions in proportion separate indirect cost pool developed. The
to the salaries and wages of all employees rate in each case must be stated as the per-
applicable to the functions. oentage which the amount of the particular
(2) Interest. Interest costs must be alio- indirect cost pool is of the distribution base
sated in the same manner as the deprecia- identified with that pool.Each indirect cost
tion on the buildings, equipment and capital rate negotiation or determination agreement
equipment to which the interest relates, must include development of the rate for
(3) Operation and maintenance ,expenses. each indirect cost pool as well as the overall
Operation and maintenance expenses must indirect cost rate. The indirect cost pools
be allocated in the same manner as the de- must be classified within two broad cat-
predation. agonies: "Facilities" and "Administration,"
(4)General administration and,general ea as described in section A.3 of this Appendix.
pensea. General administration and general
expenses must be allocated to benefitting 4.Direct Allocation Method
functions based on modified total costs Some nonprofit organizations treat all
(MToatC).The ) C is the modified total direct a.
coats as direct costs except general adn2inis-
costs (M'1'DC), as described in Subpart A— tration and general expenses. These organi-
Acronyms and Dettidire i ens of Part plus zatdane generally separate their costs into
the allocated indirect cast proportion. The
expenses included in this category could be three basic categories: (i) General adminis-
grouped first according to majorlanotions of tration and general expenses, (ii) fund.
the organization to which they render sere- raising, and (iii) other direct functions (in-
ices or provide benefits. The aggregate ex- eluding projeote performed under Federal
penes of each group must then be allocated awards). Joint costs, such as depreciation,
to benefitting functions based on MTC. rental costs, operation and maintenance of
d.Order of distribution. facilities, telephone expenses, and the like
(1) Indirect cost categories consisting of are prorated individually as direct costs to
depreciation,Interest, operation and maJute- each category and to each Federal award or
name, and general administration and gen- other activity using a base most appropriate
eral expenses must be allocated in that order to the particular cost being prorated.
to the remaining indirect cost categories as b.This method is acceptable,provided each
well as to the major functions of the organi- joint coat is prorated using a base which ae-
ration. Other frost categories should be alio- ourately measures the benefits provided to
sated in the order determined to be most ap- each Federal award or other activity. The
propriate by the organization. This order of bases must be established in aoeordanoe with ,
allocation does not apply if arose allocation reasonable criteria,and be supported by our-
of costs is made as provided in section B.8.d.2 rent data. This method is compatible with
of this Appendix. the Standards of Accounting and Financial
(2)Normally,an indirect cost category will Reporting for Voluntary Health and Welfare
be considered closed once it has been alto- Organizations issued jointly by the National
cated to other cost objectives, and costs Health Council, Inc., the National Assembly
must not be subsequently allocated to it. of Voluntary Health and Social Welfare Or-
However,a cross allocation of costs between ganizations,and the United Way of America.
two or more indirect costs categories could c. Under this method, indirect costs con-
be used if such allocation will result in a silt exclusively of general administration
more equitable allocation of costs. If a cross and general expenses. In all other respects,
allocation is used, an appropriate modifica- the organization's indirect cost rates must
tion to the composition of the indirect cost be computed in the same manner as that de-
categories is required. scribed in section B.2 Simplified allocation
e. Application of indirect cost rate or method of this Appendix.
rates. Except where a special indirect coat 5 Special Indirect Cost Bates
rate(a)is required in accordance with section
B.5 of this Appendix, the separate groupings In some instances, a single indirect cost
of indirect coats allocated to each major rate for all activities of an organization or
function must be aggregated and treated as a for each major function of the organization
9
Pt. 200, App. IV 2 CFR Ch. II (1-1-14 Edition)
may not be appropriate, since it would not f. Indirect cost proposal means the doou-
take Into account those different factors mentation prepared by an organization to
which may substantially affect the indirect substantiate its claim for the reimbursement
costs applicable to a particular segment of of indirect costs. This proposal provides the
work.For this purpose,a particular segment basis for the review and negotiation leading
of work may be that performed under a sin- to the establishment of an organization's in-
gle Federal award or it may consist of work direct cost rate.
under a group of Federal awards performed g.Cost objective means a function,organize,
in a common environment. These factors tional subdivision, contract, Federal award,
may include the physical looation of the or other work unit for which cost data are
work, the level of administrative support re- desired and for which provision is made to
quired, the nature of the facilities or other accumulate and measure the cost of woo-
resources employed,the scientific disciplines eases,projects,jobs and capitalized projecte,
or technical skills involved, the organiza-
tional arrangements used, or any combine- 2.Negotiation and Approval of Rates
tion thereof. When a particular segment of a. Unless different arrangements are
work is performed in an environment which
appears to generate a significantly different agreedhFederalo by atge Federal the agenciesa concerned,
level of indirect costs, provisions should be the agency with the largest dollar
made for a separate indirect cost pool appl value of Federal awards with an organization
cable to such work. The separate indirect will d designated as the cognizant agency
cost pool should be developed during the for al indirect oasts toer thest rates and,ion and eap-
re
course of the regular allocation process, and nneO� of the indirect cast rates where
the separate indirect cost rate resulting and
oom other rates such rates.fringebenefitf
therefrom should be used, provided It is de- compoass n drgegn o Once par-
termined that (i) the rate differs signifi_ agency is nonprofit�eo cognizance for aa oantly from that which would have been ob- Woofer will
otbchangedunless
organization, there is a
tamed under sections B.2,B.3,and B.4 of this meat will not dollar oluof there es a
Appendix, and (ii) the volume of work to swat theh n volume of the Federal
which the rate would apply Is material. y��to the organization forlg leastcie ue
years. All concerned Federal agencies must
C.NEGOTIATION AND APPROVAL of INDIRECT be given the opportunity to participate in
Coal RATES the negotiation process but, after a rate has
been agreed upon,it will be accepted by all
1.Definitions Federal agencies.When a Federal agency has
Aa used in this section,the followingterms reason to believe that special operating fac-
tors affecting its Federal awards necessitate
have the meanings set forth in this section: speoisl indirect cost rates in accordance
a. Cognizant agency for indirect costs means with section B.b of this Appendix, it will,
the Federal agency responsible for negoti- prior to the time the rates are negotiated,
ating and approving indirect cost rates for a notify the cognizant agency for indirect
nonprofit organization on behalf of all Fed- costs. (See also§200.414 Indirect (F&A)costs
eral agencies. of Part 200.)
b. Predetermined rate means an indirect cost b. Except as otherwise provided in§200.414
rate, applicable to a specified current or fu- Indirect (F&A) costs paragraph (e) of this
tare period, usually the organization's fiscal Part,a nonprofit organization which hes not
year.The rate is based on an estimate of the previously established an indirect cost rate
costs to be incurred during the period.A pre- with a Federal agency must submit its ini-
determined rate is not subject to adjust- tial indirect oost proposal after
meut. the organization is advised that a Federal
o. Fired rate means an indirect cost rate award will be made and, in no event, later
which has the same characteristics as a pre- than three months after the effective date of
determined rate, except that the difference the Federal award.
between the estimated costs and the actual o.Unless approved by the cognizant agency
costs of the period covered by the rate is oar- for indirect costa in accordance with§200.414
rind forward as an adjustment to the rate Indirect (F&A) costs paragraph (f) of this
computation of a subsequent period. Part, organizations that have previously es-
d. Final rate means an indirect cost rate tablished indirect cost rates must submit a
applicable to a specified past period which is new indirect cost proposal to the cognizant
based on the actual costs of the period. A agency for indirect costs within six months
final rate is not subject to adjustment, after the close of each fiscal year.
e. Provisional rate or billing rate means a d.A predetermined rate may be negotiated
temporary indirect cost rate applicable to a for use on Federal awards where there is rea-
specified period which is used for funding, in- sonable assurance, based on past experience
terim reimbursement, and reporting indirect and reliable projection of the organization's
costs on Federal awards pending the estab- costs, that the rate is not Iikely to exceed a
lishment of a final rate for the period. rate based on the organization's actual costs.
210
OMB Guidance Pt. 200, App.V
e. Fixed rates may be negotiated where to which they apply and with Subpart E—
predetermined rates are not considered ap- Cost Principles of Part 200.
propriate.A fixed rate,however,must not be (3)This proposal does not include any costs
negotiated if(i) all or a substantial portion which are unallowable under Subpart E—
of the organization's Federal awards are el- Cost Principles of Part 200 such as (without
pected to expire before the carry-forward ad- limitation): public relations costs, contribu-
justment can be made;(ii)the mix of Federal tions and donations, entertainment costs,
and non-Federal work at the organization is fines and penalties, lobbying casts, and de-
too erratic to permit an equitable carry-for- fence of fraud proceedings;and
ward adjustment; or (iii) the organization's (4) All costs included in this proposal are
operations fluctuate significantly from year properly allocable to Federal awards on the
to year. basis of a beneficial or causal relationship
f.Provisional and final rates must be nego- between the expenses incurred and the Fed-
tinted where neither predetermined nor fixed oral awards to which they are allocated in
rates are appropriate. Predetermined or accordance with applicable requirements.
fixed rates may replace provisional rates at I declare that the foregoing is true and cor-
any time prior to the close of the organize-
tion's fiscal year. If that event does not tact.
occur,a final rate will be established and up- Nonprofit Organization:
ward or downward adjustments will be made , Signature:
based on the actual allowable costs incurred Name of Official: __
for the period involved. Title:
g. The results of each negotiation must be Date of Execution:
formalized in a written agreement between
the cognizant agency for indirect costs and APPENDIX V TO PART 200—STATE/LOcA_L
the nonprofit organization. The cognizant GOVERNMENT AND INDIAN TRIBE-
agency for indirect costs must make avail- WIDE CENTRAL SERVICE COST ALLO-
able copies of the agreement to all concerned CATION PLANS
Federal agencies.
h.If a dispute arises in a negotiation of an A.
indireat cost rate between the cognizant
agency for indirect costs and the nonprofit 1. Most governmental units provide certain
organization,the dispute must be resolved in services,such as motor pools, computer cen-
accordance with the appeals procedures of tars, purchasing, accounting, etc., to oper-
the cognizant agency for indirect coats. ating agencies on a centralized basis. Since
i. To the extent that problems are enooun- federally-supported awards are performed
tared among the Federal agencies in omen- within the individual operating agencies,
Lion with the negotiation and approval proo- there needs to be a process whereby these
sea, OMB will lend assistance as required to central service costs can be identified and
resolve such problems in a timely manner. assigned to benefitted activities on a reason-
able and consistent basis.The central service
D.Certification of Indirect(F&A)Costs cost allocation plan provides that process.
Required Certification. No proposal to es- All costs and other data used to distribute
tablieh indirect(F&A)cost rates must be so- the costs included in the plan should be sup-
oeptable unless such costs have been cer- ported by formal accounting and other
tilled by the non-profit organization using records that will support the propriety of the
the Certificate of Indirect (F&A) Costs sat costs assigned to Federal awards.
forth in section j. of this appendix.The oar- 2. Guidelines and illustrations of central
tificate must be signed on behalf of the orga- service cost allocation plans are provided in
nization by an individual at a level no lower a brochure published by the Department of
than vice president or chief financial officer Health and Human Services entitled "A
for the organization, Guide for State, Local and Indian Tribal Gov-
j. Each indirect cost rate proposal must be ernments: Cost Principles and Procedures for
accompanied by a certification in the fol- Developing Cost Allocation Plans and Indirect
lowing form: Cost Rates for Agreements with the Federal
Government." A copy of this brochure may be
Certificate of Indirect(F&A)Costs obtained from the Superintendent of Doan-
This is to certify that to the best of my means,U.S.Government Printing Office.
knowledge and belief; B.DEFINrrION6
(I)I have reviewed the indirect(F&A)cost
proposal submitted herewith; 1. Agency or operating agency means an or-
(2)All costs included in this proposal[iden- ganizational unit or sub-division within a
tifp date] to establish billing or final indi- governmental unit that is responsible for the
rest (F&A) costs rate for [identify period performance or administration of Federal
covered by ratel are allowable in accordance awards or activities of the governmental
with the requirements of the Federal awards unit.
211
EXHIBIT J
UNITED STATES CITIZENSHIP ATTESTATION FORM FOR PUBLIC BENEFIT
For the purposes of complying with Neb. Rev. Stat. §§ 4-108 through 4-114, I attest as follows:
❑ I am a citizen of the United States.
OR
❑ I am a qualified alien under the Federal Immigration and Nationality Act. My
immigration status and alien number as follows:
, and I agree to provide
a copy of my USCIS (United States Citizenship and Immigration Services)
documentation upon request.
I hereby attest that my response and the information provided on this form and any related
application for public benefits are true, complete and accurate and I understand that this
information may be used to verify my lawful presence in the United States.
PRINT NAME:
By:
SIGNATURE:
DATE:
O
oa`�oR UNITY Q:Library/HCD Forms/Citizenship-Attestation Form for Public Benefit 10/26/2009
EXHIBIT K
AFFIDAVIT FOR EMPLOYEE CLASSIFICATION ACT
STATE OF )
) §
COUNTY OF )
I, ,being first duly sworn under oath, state and
depose as follows:
1. I am competent to testify to,and have personal knowledge of,the matters stated in this affidavit.
2. I am(a contractor)(the authorized agent of the contractor ).
I attest to the following: (a) each individual performing services for such contractor is properly classified under the
Nebraska Employee Classification Act, 2010 LB 563 ("the Act"), (b) such contractor has completed a federal I-9
immigration form and has such form on file for each employee performing services, (c) such contractor has
complied with Neb. Rev. Stat. section 4-114 (federal immigration verification system), (d) such contractor has no
reasonable basis to believe that any individual performing services for such contractor is an undocumented worker,
and(e) as of the time of the contract, such contractor is not barred from contracting with the state or any political
subdivision pursuant to the Act.
FURTHER AFFIANT SAYETH NAUGHT.
Affiant
SUBSCRIBED AND SWORN TO before me this day of ,20
Notary Public
O
OPPORTUNITY Approved 6/1/10
HOMEOWNERSHIP FINANCIAL STATUS REPORT FORM EXHIBIT I
(Please attach AIA G702 form and other comparable supporting documentation for expendit.
Developer Name: Program: CDBG ❑
ESG 0
Developer's Contractor: HOME ❑
NAHTF ❑
Project Address: NSP ❑
SHP ❑
Project Type: Acquisition ❑
Loan#: New Constr 0
Rehab 0
Reporting Period: From: to
DEVELOPMENT PROJECT % BUDGET
COSTS BUDGET COMPLETE REMAINING
Hard costs $ % $
Soft costs:
Developer's overhead* $ % $
Property Taxes $ % $
Property Insurance $ % $
Real Estate Transfer Fees $ % $
Recording Fees $ % $
Appraisal Fee(s) $ % $
Title Insurance $ % $
Omaha 100 Loan Fee $ % $
FHAS Counseling Fee $ % $
Advertising $ % $
Utilities $ % $
Grounds Maintenance $ % $
Other(explain: $ % $
Other(explain: ) $ % $
Other: $ % $
TOTALS $ % $
* Developer's overhead percentage is based on the percent of hard cost work completed in the attached in AIA or comparable document.
TOTAL PAY REQUEST:$
Amount Amount
City Funds Other Funds
$ $
FUNDING SOURCES PROJECT % BUDGET
BUDGET COMPLETE REMAINING
$ % $
$ % $
$ % $
Other: $ % $
Other: $ % $
Other: $ % $
TOTALS: $ % $
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
Printed Name:
O
OPPORTUNITY Revised and approved 11/5/2009
NON-HOMEOWNERSHIP FINANCIAL STATUS REPORT FORM
(Please attach AIA G702 form and other comparable supporting documentation for expenditures)
Developer Name: Program: CDBG ❑
ESG ❑
Developer's Contractor: HOME 0
NAHTF ❑
Project Address: NSP ❑
SHP ❑
Project Type: Acquisition 0
Loan#: New Constr ❑
Rehab ❑
Reporting Period: From: to
DEVELOPMENT PROJECT % BUDGET
COSTS BUDGET COMPLETE REMAINING
Hard costs $ % $
Soft costs(list):
$ % $
$ % $
$ % $
$ % $
$ % $
$ % $
$ % $
$ % $
$ % $
$ % $
$ % $
$ % $
$ % $
$ % $
$ % $
TOTALS $ % $
TOTAL PAY REQUEST:$
Amount Amount
City Funds Other Funds
$ $
FUNDING SOURCES PROJECT % BUDGET
BUDGET COMPLETE REMAINING
$ % $
$ % $
$ % $
Other: $ % $
Other: $ % $
Other: $ % $
TOTALS: $ % $
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
Printed Name:
O
OPPORTUNITY Revised and approved 6/18/2010
EXHIBIT M
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EXHIBIT N
Federal Sub-award Reporting System(FSRS)
9 Digit DUNS Number
Organization Name:
Address:
Welt;
City sate Zip Code+4
Question 1:During your organizations preceding completed fiscal year,did the legal entity to which the DUNS number
belongs receive(1)80 percent or more of its annual gross revenues in U.S.federal contracts,subcontracts, loans,grants,
subgrants,and/or cooperative agreements;and(2)$25,000,000 or more in annual gross revenues from U.S.federal
contracts,subcontracts,loans,grants,subgrants,and/or cooperative agreements?
DYES O NO
If YES please answer Question 2
Question 2:Does the public have access to information about the compensation of the executives in your organization
(the legal entity to which.the DUNS number provided belongs)through periodic reports filed under section 13(a)or
15(d)of the Securities Exchange Act of 1934(15 U.S.C.78m(a),78o(d)or section 6104 of the Internal Revenue Code of
1986?
YES NOS.
If NO please answer Question 3
Question 3:What are the Names and Total Compensation for the top 5 employees in your organization?
Name • Compensation
2 $:.
3 $'
4 •
S
Signature of Authorized Official De
Requirements for Federal Funding
Accountability and Transparency Act
Implementation
In September 2010,the Office of Management and Budget issued Interim Final
Guidance in the Federal Register(Volume 75, No. 177, September 14, 2010, 2 CFR
Part 170)to establish reporting requirements necessary for the implementation of the
Federal Funding Accountability and Transparency Act of 2006 (Pub. L. 109-282), as
amended by section 6202 of Public Law 110-252. This award term implements those
requirements and is located at 2 CFR Part 170. Learn more
Appendix A to Past 170—Award Term
Reporting Subawards and Executive Compensation.
a Reporting of first-tier subawards.
1. Applicability. Unless you are exempt as provided in paragraph d. of this award
term, you must report each action that obligates $25,000 or more in Federal
funds that does not include Recovery funds(as defined in section 1512(a)(2) of
the American Recovery and Reinvestment Act of 2009, Pub. L. 111-5)for a
subaward to an entity (see definitions in paragraph e. of this award term).
2. Where and when to report.
is You must report each obligating action described in paragraph a.1. of this
award term to the Federal Funding Accountability and Transparency Act
Subaward Reporting System(FSRS).
fi. For subaward information, report no later than the end of the month
following the month in which the obligation was made. (For example, if
the obligation was made on November 7, 2010,the obligation must be
reported by no later than December 31,2010.)
a. What to report. You must report the information about each obligating action that
the submission instructions posted at http:liwww.fsrs.gov specify.
b.Reporting Total Compensation of Recipient Executives.
1. Applicability and what to report. You must report total compensation for each of
your five most highly compensated executives for the preceding completed fiscal
year, if—
the total Federal funding authorized to date under this award is$25,000
or more;
ii in the preceding fiscal year, you received—
A. 80 percent or more of your annual gross revenues from Federal
procurement contracts(and subcontracts) and Federal financial
assistance subject to the Transparency Act, as defined at 2 CFR
170.320 (and subawards); and
B. $25,000,000 or more in annual gross revenues from Federal
procurement contracts(and subcontracts) and Federal financial
assistance subject to the Transparency Act,as defined at 2 CFR
170.320 (and subawards); and
x ill; The public does not have access to information about the compensation
of the executives through periodic reports filed under section 13(a) or
15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m(a), 78o(d))
or section 6104 of the Internal Revenue Code of 1986.(To determine if
the public has access to the compensation information, see the U.S.
Security and Exchange Commission total compensation filings at the
Executive Compensation page of the SEC website.)
2. Where and when to report. You must report executive total compensation
described in paragraph b.1. of this award term:
As part of your registration profile at the Central Contractor Registry.
ti. By the end,of the month following the month in which this award,is made,
and annually thereafter.
c. Reporting of Total Compensation of Subrecipient Executives.
1: Applicability and what to report. Unless you are exempt as provided in paragraph
d,,of this award term,for each first-tier subrecipient under this award, you shall
report the names and total compensation of each of the subrecipient s five most
highly compensated executives for the subrecipient's preceding completed fiscal
year, if--
I.
in the subrecipient's preceding fiscal year, the subrecipient received
A. 80 percent or more of its annual gross revenues from Federal
procurement contracts (and subcontracts)and Federal financial
assistance subject to the Transparency Act, as defined at 2 CFR.
170.320(and subawards); and
B.. $25,000,000 or more in annual gross revenues from Federal
procurement contracts(and subcontracts),and Federal financial
assistance subject to the Transparency Act(and subawards); and
t!. The public does not have access to information about the compensation
of the executives through periodic reports filed under section 13(a)or
15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m(a), 780(d)}
or section 6104 of the Internal Revenue Code of 1986. (To determine if
the public has access to the compensation information, see the U.S.
Security and Exchange Commission total compensation filings at the
Executive Compensation page of the SEC'website.)
2, Where and.when to report. You must report subrecipient executive total
compensation described in paragraph c.1. of this award term:
To the recipient.
ii, By the end of the month following the month during which you make the
subaward. For example, if a subaward is obligated on any date during the
month of October of a given year(i.e., between October 1 and 31),you
must report any required compensation information of the subrecipient by
November 30 of that year.
d. Exemptions
If, in the previous tax year, you had gross income, from all sources, under$300,000, you
are exempt from the requirements to report:
is Subawards,and
i. The total compensation of the five most highly compensated executives
of any subrecipient.
e. Definitions.
For purposes of this award term:
1. "Entity"means all of the following, as defined in 2 CFR part 25:
I. A Governmental organization, which is a State, local government, or
Indian tribe;
it. A foreign public entity;
A domestic or foreign nonprofit organization;
iv A domestic or foreign for-profit organization;
v. A Federal agency, but only as a subrecipient under an award or
subaward to a non-Federal entity.
2. "Executive" means officers, managing partners, or any other employees in
management positions.
3, "Subaward":
i. This term means a legal instrument to provide support for the
performance of any portion of the substantive project or program for
which you received this award and that you as the recipient award to an
eligible subrecipient.
IL The term does not include your procurement of property and services
needed to carry out the project or program(for further explanation, see
Sec. II .210 of the attachment to OMB Circular A-133, "Audits of States,
Local Governments, and Non-Profit Organizations").
iii, A subaward may be provided through any legal agreement, including an
agreement that you or a subrecipient considers a contract.
�1< "Subrecipient means an entity that:
i. Receives a subaward from you (the recipient) under this award; and
li. Is accountable to you for the use of the Federal funds provided by the
subaward.
5. "Total compensation" means the cash and noncash dollar value earned by the
executive during the recipient's or subrecipient's preceding fiscal year and
includes the following(for more information see 17 CFR 229.402(c)(2)):
I. Salary and bonus.
ii. Awards of stock, stock options, and stock appreciation rights. Use the
dollar amount recognized for financial statement reporting purposes with
respect to the-fiscal year in accordance with the Statement of Financial
Accounting Standards No. 123 (Revised 2004) (FAS 123R), Shared
Based Payments.
ill. Earnings for services under non-equity incentive plans. This does not
include group life, health, hospitalization or medical reimbursement plans
that do not discriminate in favor of executives, and are available generally
to all salaried employees.
iv, Change in pension value. This is the change in present value of defined
benefit and actuarial pension plans.
v. Above-market earnings on deferred compensation which is not tax-
qualified.
vi. Other compensation, if the aggregate value of all such other
compensation (e.g. severance,termination payments, value of life
insurance paid on behalf of the employee,perquisites or property)for the
executive exceeds $10,000.
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).
I (we) acknowledge receipt of a copy of this Definition of Income.
Date Witness Date
Date Witness Date
EQUAL HOUSING
OPPORTUNITY
Revised and approved 11/16/2009
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, sexual
orientation, gender identity, national origin, disability 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, sexual orientation, gender identity, sex, national origin, age,
disability 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 Rights
and Relations Contract Compliance Officer 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 Rights and Relations
Contract Compliance Officer shall be those which are related to Paragraphs (1)
through (7) of this Exhibit 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
Revised and approved 5/23/2012
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 Rights and
Relations Contract Compliance Officer. 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)
Revised and approved 5/23/2012
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 2014
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FSB�' PLANNING•OMAHA
Jean Stothert,Mayor PLANNING DEPARTMENT James R.Thele
City of Omaha CITY OF OMAHA City of Omaha
Planning Department
Omaha/Douglas Civic Center
1819 Farnam Street
Omaha,Nebraska 68183
1 Reviewed and approved 10/3/2014
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,
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 adopt the City's
MBE/WBE Enterprise Plan. The Minority Business/Women Business Enterprise and Fair
Housing plan must be filled out by contractors, developers, corporations, partnerships and/or sole
proprietors.
2. Ensure that Requests for Proposals have the MBE/WBE Enterprise Plan.
3. Ensure that the programs of the Planning Department are advertised in the appropriate new media
whose markets are targeted toward MBE/WBE.
2 Reviewed and approved 10/3/2014
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
Rights & Relations Department. In addition, require these entities to complete CC-1 (Human
Relations Department).
The following information has been developed to assist you in complying with the MBE/WBE
requirements in the agreement with the City of Omaha. If you have any questions, please contact Edward
Dantzler at(402) 444-5150 Ext. 2009.
3 Reviewed and approved 10/3/2014
MBE/WBE FOR GOODS AND SERVICES
Your company must make vendors aware of 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.
City of Omaha
Housing and Community Development Division
1819 Famam Street Room 1111
Omaha,NE 68183
Edward Dantzler, Development Section Manager
ed.dantzler@cityofomaha.org
(402)444-5150 Ext. 2009 Fax: (402)444-5201
City of Omaha
Human Rights &Relations
Contract Compliance
1819 Famam Street Room 502
Omaha,NE 68183
Maria Partida, Contract Compliance
maria.partida@cityofomaha.org
(402)444-5050 Fax: (402)444-5058
Minority Economic Development
Greater Omaha Chamber of Commerce
1301 Harney Street
Omaha,NE 68102
Winsley Durand, Senior Director-Business Attraction
wdurand@selectgreateromaha.com
(402) 233-7144 Fax: (402) 346-7050
4 Reviewed and approved 10/3/2014
MBE/WBE FOR GOODS AND SERVICES
North Omaha Contractor Alliance
2505 North 24th Street Suite 409A
Omaha,NE 68110
Houston McKell, III, Executive Director
houstonmckell@yahoo.com
(402) 991-3420
Omaha Small Business Network, Inc.
2505 North 24th Street
Omaha,NE 68110
Julie Parker, Executive Director
info@osbnbtc.org
(402)453-5336 Fax: (402) 451-2876
Small Business Administration
10675 Bedford Avenue Suite 100
Omaha,NE 68134
Dwight Johnson
dwight.johnson@sba.gov
(402) 221-7206 Fax: (402) 221-3680
Urban League of Nebraska, Inc.
3040 Lake Street
Omaha,NE 68110
Thomas H. Warren, President/CEO
thomas.warren@urbanleagueneb.org
(402)451-1066
5 Reviewed and approved 10/3/2014
CITY OF OMAHA
CONTRACTOR INFORMATION FORM
Date:
Project Address:
Owner Information
Name:
Address:
City,St.,Zip:
Phone:
General Contractor Information
Name:
Address:
City,St.,Zip:
Phone:
Federal Tax ID or SSN
Contract Amount $
Woman Owned Business ❑Yes El No
BRE(Business Owned Race/Ethnic)Code:
(BRE Code: 1 White American; 2 Black American; 3 Native American; 4 Hispanic American 5 Asian/Pacific American; 6 Hasidic Jews
_Subcontractor Information (Complete for each subcontractor for the project)
Name/Address Fed Tax Contract Woman Own BRE
ID/SSN Amt. Code
Name: $ ❑Yes ❑No
Address:
City,St.,Zip:
Phone:
Name: $ ❑Yes ❑No
Address:
City,St.,Zip:
Phone:
Name: $ ❑Yes ❑No
Address:
City,St.,Zip:
Phone:
Name: $ ❑Yes ❑No
Address:
City,St.,Zip:
Phone:
Name: $ ❑Yes ❑No
Address:
City,St.,Zip:
Phone:
Name: $ ❑Yes ❑No
Address:
City,St.,Zip:
Phone:
Name: $ ❑ Yes ❑No
Address:
City,St.,Zip:
Phone:
6 Reviewed and approved 10/3/2014
Date:
Project Address:
Owner Information
Name:
General Contractor Information
Name:
(BRE Code: 1 White American; 2 Black American; 3 Native American; 4 Hispanic American 5 Asian/Pacific American; 6 Hasidic Jews
Name/Address Fed Tax Contract Woman Own BRE
ID/SSN Amt.
Name: $ ❑Yes ❑No
Address:
City,St.,Zip:
Phone:
Name: $ ❑Yes ❑No
Address:
City,St.,Zip:
Phone:
Name: $ ❑Yes ❑No
Address:
City,St.,Zip:
Phone:
Name: $ ❑Yes ❑No
Address:
City,St.,Zip:
Phone:
Name: $ ❑Yes ❑No
Address:
City,St.,Zip:
Phone:
Name: $ ❑Yes ❑No
Address:
City,St.,Zip:
Phone:
Name: $ ❑Yes ❑No
Address:
City,St.,Zip:
Phone:
Name: $ ❑Yes ❑No
Address:
City,St.,Zip:
Phone:
Name: $ ❑ Yes ❑No
Address:
City,St.,Zip:
Phone:
7 Reviewed and approved 10/3/2014
DEFINITIONS:
1. American Indian or Alaska Native. A person having origins in any of the original peoples of North
and South America (including Central America), and who maintains tribal affiliation or community
attachment.
2. Asian. A person having origins in any of the original peoples of the Far East, Southeast Asia, or the
Indian subcontinent including, for example, Cambodia, China, India, Japan, Korea, Malaysia,
Pakistan,the Philippine Islands, Thailand and Vietnam.
3. Black or African American. A person having origins in any of the black racial groups of Africa.
Terms such as"Haitian"or"Negro"can be used in addition to "Black" or"African American".
4. Native Hawaiian or Other Pacific Islander. A person having origins in any of the original peoples
of Hawaii, Guam, Samoa or other Pacific Islands.
5. White. A person having origins in any of the original peoples of Europe, the Middle East or North
Africa.
8 Reviewed and approved 10/3/2014
MINORITY BUSINESS/WOMEN BUSINESS ENTERPRISE
AND FAIR HOUSING PLAN
As Owner(s), , I/we agree that my/our
contractors and subcontractors will make our best efforts to ensure the construction services,
contracts and employment opportunities are affirmatively marketed to women and members of
minority groups as outlined in the City of Omaha's Policy for Minority Business/Women
Business Enterprise and to further Fair Housing, where applicable, in the following manner.
1. Provide employment opportunities without regard to race, color, sex, age, religion,
national origin, familial or handicap status;
2. Encourage, increase and promote business and procurement opportunities for
women-owned businesses;
3. Award contracts to eligible minority-owned and women-owned firms;
4. Monitor contractor and vendor equal opportunity performance.
As Owner(s), , I/we agree that our contractors and
subcontractors will not discriminate against any employee or applicant for employment because
of race, color, sex, age, religion, national origin, familial or handicap status.
As Owner(s), , I/we agree that my/our contractors
and subcontractors shall in all solicitations or advertisements for employment give all qualified
applicants consideration for employment without regard to race, color, sex, age, religion,
national origin, familial or handicap status.
As Owner(s), , I/we certify that I/we support the
furtherance of fair housing choice and that I/we will not discriminate on the basis of race, color,
religion, sex, national origin, familial status, marital or handicap status in the rental or sale of the
assisted property nor in any activities related to the sale, rental, and operation of the assisted
property in accordance with the applicable laws and regulations.
Dated this day of , 20
Business or Corporation(if applicable)
By:
Signature of Owner/Authorized Representative Name
Print Owner/Authorized Representative Name
EA
OWTUNRY
9 Reviewed and approved 10/3/2014
ATTACHMENT: 5
Race and Ethnic Data U.S.Department of Housing OMB Approval IN V.Z.JVZ-VLV'+
Reporting Form and Urban Development (exp.03/31/2011)
Office of Housing
Name of Property Project No. Address of Property
Name of Owner/Managing Agent Type of Assistance or Program Title
Name of Head of Household Name of Household Member
Date(mm/dd/yyyy):F P 4 t a t an"t *i1 a fi c1 5"W e,.,lf f.
t
S 't rt §Wi f iSre egoriesh ui ri T s O -
'
s � 01. u,, yt '6-` d at e a . x g
.k e Nn s�se ° ,E. " f3, h3 ` At, , 1± s _ 0 :
Hispanic or Latino ❑
Not-Hispanic or Latino El
'�"� V4 ' ' ele t '
t r � 1hy pS® gt - 3ii c ad ® , a
r p e 5 ! TK 7i rM 0
.0 n
American Indian or Alaska Native ❑
Asian ❑
Black or African American ❑
Native Hawaiian or Other Pacific Islander ❑
White ❑
Other ❑
*Definitions of these categories may be found on the reverse side.
There is no penalty for persons who do not complete the form.
Signature Date
Public reporting burden for this collection is estimated to average 10 minutes per response, including the time for reviewing instructions,
searching existing data sources,gathering and maintaining the data needed,and completing and reviewing the collection of information. This
information is required to obtain benefits and voluntary. HUD may not collect this information,and you are not required to complete this form,
unless it displays a currently valid OMB control number.
This information is authorized by the U.S.Housing Act of 1937,as amended,the Housing and Urban Rural Recovery Act of 1983 and Housing
and Community Development Technical Amendments of 1984. This information is needed to be in compliance with OMB-mandated changes to
Ethnicity and Race categories for recording the 50059 Data Requirements to HUD. Owners/agents must offer the opportunity to the head and co-
head of each household to"self certify"during the application interview or lease signing. In-place tenants must complete the format as part of
their next interim or annual re-certification. This process will allow the owner/agent to collect the needed information on all members of the
household. Completed documents should be stapled together for each household and placed in the household's file. Parents or guardians are to
complete the self-certification for children under the age of 18. Once system development funds are provided and the appropriate system
upgrades have been implemented,owners/agents will be required to report the race and ethnicity data electronically to the TRACS(Tenant Rental
Assistance Certification System). This information is considered non-sensitive and does not require any special protection.
1
in
OPPORTUNITY Q:Library/HCD Forms/Race and Ethnic Data Reporting Form 7/7/2010
Instructions for the Race and Ethnic Data Reporting(Form HUD-27061-H)
A. General Instructions:
This form is to be completed by the head of household for those wishing to be served
(applicants) and those that are currently served (tenants/owner-occupants) in housing
assisted by the Department of Housing and Urban Development.
If the assisted property is a rental unit, the owner or agent is required to offer the
applicant/tenant the option to complete the form. The form is to be completed at initial
application or at lease signing. In-place tenants must also be offered the opportunity to
complete the form as part of the next interim or annual recertification. Once the form is
completed, it need not be completed again unless the head of household changes. There is
no penalty for persons who do not complete the form. However, the owner or agent may
place a note in the tenant file stating the applicant/tenant refused to complete the form.
Completed documents should be placed in the household's file.
The Office of Housing has been given permission to use this form for gathering race and
ethnic data in assisted housing programs.
1. The two ethnic categories you should from are defined below. You should check one of
the two categories.
A. Hispanic or Latino. A person of Cuban, Mexican, Puerto Rican, South or Central
American or other Spanish culture or origin, regardless of race. The term of"Spanish
origin" can be used in addition to "Hispanic"or"Latino".
B. Not Hispanic or Latino. A person not of Cuban, Mexican, Puerto Rican, South or
Central American, or other Spanish culture or origin, regardless of race.
2. The five racial categories to choose from are defined below: You should check as many as
apply to you.
A. American Indian or Alaska Native. A person having origins in any of the original
peoples of North and South America(including Central America), and who maintains
tribal affiliation or community attachment.
B. Asian. A person having origins in any of the original peoples of the Far East,
Southeast Asia, or the Indian subcontinent including, for example, Cambodia, China,
India, Japan, Korea, Malaysia, Pakistan, the Philippine Islands, Thailand and
Vietnam.
C. Black or African American. A person having origins in any of the black racial
groups of Africa. Terms such as "Hatian" or "Negro" can be used in addition to
"Black"or"African American".
D. Native Hawaiian or Other Pacific Islander. A person having origins in any of the
original peoples of Hawaii, Guam, Samoa, or other Pacific Islands.
E. White. A person having origins in any of the original peoples of Europe, the Middle
East or North Africa.
2
MERV Q:Library/HCD Forms/Race and Ethnic Data Reporting Form 7/7/2010
C Asa CITY OF OMAHA
LEGISLATIVE CHAMBER
Omaha,Nebraska
RESOLVED BY THE CITY COUNCIL OF THE CITY OF OMAHA: rr
•
WHEREAS, the City annually receives Community Development Block Grant
funds under Title I of the Housing and Community Development Act of 1974,"as amended, for
the purpose of benefiting low and moderate income residents, eliminating slums and blight, and
for other urgent community development needs; and,
WHEREAS, the Mayor recommended various projects in the 2016 Consolidated
Submission for Community Planning and Development Programs (Consolidated Plan), including
the continuation of the Family Housing Advisory Services, Inc., a Nebraska Non-profit
Corporation (FHAS) Housing Counseling Program; and,
WHEREAS, the City approved the 2016 Consolidated Plan on April 12, 2016, by
Resolution No. 382, and $50,000.00 was allocated to FHAS; and,
WHEREAS, FHAS provides an excellent program of comprehensive housing
counseling to help families and individuals successfully participate in City-sponsored housing
programs; and,
WHEREAS, it is in the best interest of the City of Omaha to enter into an
agreement with FHAS, to provide funding support for counseling for applicants and participants
in City-sponsored housing rehabilitation programs.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF OMAHA:
THAT, the attached Agreement, as recommended by the Mayor, between the City
of Omaha and Family Housing Advisory Services, Inc., a Nebraska Non-profit Corporation,
Teresa C. Hunter, Executive Director, 2401 Lake Street, Omaha, Nebraska 68111, in the amount
of $50,000.00 for funding support for its housing counseling program for the period from
January 1, 2016 through December 31, 2016, is hereby approved. Funds shall be paid from the
FY 2016 Community Development Block Grant, Housing Development Program, Fund No.
12186, and Organization No. 128072.
2423 dlh APPROVED AS TO FORM:
• - lamPt6
CITY ATTORNEY DATE
By dL I •447.w.
Councilmember
Adopted P .2...7..2O1 ...
City Clerk 9 /`'r �/d
Approved....
Mayor
,Y5('
57 NO ,.,.../,: -
Resolution by
Res. that. the attached Agreement. as
recommended by the Mayor, between the
City of Omaha and Family Housing
Advisory Services. Inc., a Nebraska Non-
profit Corporation, Teresa C. Hunter,
Executive Director, 2401 Lake Street,
Omaha. Nebraska 68111. in the amount of
$50.000,00 for funding support for its
housing counseling program for the period
from January 1, 2016 through December 31,
2016, is hereby approved. Funds shall be
paid from the FY 2016 Community
Development Block Grant, Housing
Development Program. Fund No. 12186,
and Organization No. 128072.
2423 dlh
i.=
Presented to City Council
SEP 2 7 2016
Adopted
5u3ted fi'pottilt.
City Clerk