2CFR215 (A-110) Uniform Administrative Requirements for Grants and Agreements with Institutions of Higher Education, Hospitals, and Other Non- Profit Organizations

2 Introduction to OMB Circular A-110 Purpose: Establish uniform administrative requirements; Establish consistent application of the requirements Prevent deviations or additional requirements without OMB approval

3 Federal Proposal Considerations: OMB Circular A-110 Uniform Administrative Requirements for Grants and Agreements with Institutions of Higher Education and Other Non-profit Organizations Subpart A – General Subpart B - Pre-award requirements Subpart C - Post-award requirements Subpart D - After the award requirements Appendix A - Contract provisions

A-110: Subpart A - General Effect of A-110 on other issuances ◦ Awards subject to A-110, all other administrative requirements codified in program regulations, manuals, handbooks inconsistent with this circular are superseded, unless required by statute or authorized by the deviations provision of this circular Deviations ◦ Exceptions to A-110 are permitted in unusual circumstances by OMB Subawards ◦ A-110 should be flowed down to subrecipients which are normally subject to it 4

5 A-110: Subpart B - Pre Award Requirements Purpose: ◦ Establishes instructions and forms used in applying for federal assistance Pre Award Policies: ◦ Agency decides on appropriate award instrument ◦ Grant used when principal purpose is to provide support to accomplish a public purpose ◦ Cooperative Agreement same as a grant, except substantial involvement is expected by the awarding agency ◦ Contract used only when principal purpose is acquisition of property or services for direct benefit of Government

6 A-110: Subpart B - Pre Award Requirements (continued) Forms Used When Applying For Assistance: ◦ Agencies must comply with 5CFR part “Controlling Paperwork Burdens on the Public” ◦ Applicants shall use SF-424 series, or forms and instructions prescribed by agency ◦ Programs covered by E. O “Intergovernmental Review of Federal Programs” -- applicants must complete appropriate sections of SF 424 or if agency not using SF-424, whether E.O review is required. Debarment And Suspension ◦ Agencies and recipients must comply with the non-procurement common rule

7 A-110: (continued) Special Award Conditions ◦ Additional requirements may be imposed by agencies if:  Recipient has history of poor performance  Recipient is not financially stable  Recipient has management system that does not meet standards  Recipient has not conformed with terms and conditions of previous award  Recipient is not responsible ◦ Recipient must be notified in writing ◦ Special conditions removed once corrections are made

8 A-110: Subpart C - Post Award Requirements Prescribes standards for financial and program management of sponsored research awards ◦ Standards for financial management systems ◦ Methods for making payments ◦ Cost sharing and matching ◦ Program income ◦ Revision of budget and program plans ◦ Non-federal audits ◦ Allowable costs ◦ Fund availability ◦ Conditional Exemptions

A-110: Subpart C – continued Prescribes standards for financial and program management of sponsored research awards ◦ Property standards for the management and disposition of Federally-funded property. ◦ Title to equipment ◦ Property management standards ◦ Feds maintain a royalty-free nonexclusive right to copyrighted material. ◦ Procurement Standards ◦ Reports and Records ◦ Termination and Enforcement

10 Standards for financial management systems ◦ Relate financial data to performance data ◦ Recipient’s financial system must provide:  Financial results of each sponsored project  Identification of source & application of funds  Control & accountability over all funds, property & other assets  Comparison of outlays to budget amounts ◦ Procedures to minimize time between transfer of funds and the disbursement of those funds ◦ Procedures for determining reasonableness, allocability and allowability of costs ◦ Accounting records supported by source documentation

Payment Methods Payment times should be minimized between the time of invoicing and Federal reimbursement. Advances are possible; but cost reimbursement is preferred method. Advances are to be maintained in interest bearing accounts. Stipulates which Federal forms should be used.

12 Cost Sharing …represents that portion of the total project costs of a sponsored agreement paid for by the institution, rather than by the sponsor.

13 Proposing Cost Sharing Mandatory Cost Sharing is Required by the sponsor as a condition of obtaining an award. Voluntary Cost Sharing is Offered to increase competitiveness against peer institutions for an award or for other non-mandatory reasons Committed Once Mandatory or Voluntary Cost Sharing is Proposed to a sponsor, and Accepted in an award it becomes committed!

14 Cost Sharing Mandatory and Voluntary committed cost sharing must be monitored, verified and included in the F&A rate calculation ◦ Lowers the F&A rate and decreases recovery of F&A revenue Voluntary uncommitted cost sharing ◦ Effort put forth by a PI or senior researcher on a project that was not pledged in the proposal or required by the award (e.g. the PI committed 5% effort but actually devoted 20% effort, the 15% difference would be considered voluntary uncommitted cost sharing) ◦ Does not have to be included in the F&A rate

15 Examples of Cost Sharing Effort - faculty, staff or student ( Example, “30% effort with 10% of salary charged to the project”) Cash Third Party Contributions Unrecovered F&A costs (can be used if agency has approved) Volunteer Services: Necessary and integral part of project Establishing values for contributions of services and property (in accordance with applicable cost principles) Other employee services (valued at regular rate of pay plus fringe benefits) Donated supplies (must be reasonable and at fair market value)

16 Expenditures That Can NOT Be Proposed as Cost Sharing Unallowable costs ◦ Salaries over the salary cap ◦ Cost overruns/overdrafts Purchase price of equipment in current inventory Other items your institution might prohibit? If a sponsor wouldn’t pay for it anyway, it can’t be proposed as cost sharing.

17 Cost Sharing Considerations Cash and third party in-kind contributions must meet all the following criteria: ◦ Are verifiable from the recipient’s records ◦ Cannot be used as cost sharing on other federal projects ◦ Are necessary and reasonable for accomplishment of project objectives ◦ Are allowable under the cost principles ◦ Are not paid by the Federal government under another award ◦ Are provided for in the approved budget when required by Federal agency ◦ Conform to other provisions of A-110, as applicable

18 Cost Sharing Issues A-110 requires that actual expenditures must be verifiable from the recipient's records. A-21/CAS requirements ◦ All costs of a project must be classified consistently, regardless of the funding source ◦ Do we classify all cost sharing consistently with the project costs? ◦ Cost sharing can have a significant impact on the F&A rate, auditors and negotiators want institutions to capture all cost sharing, mandatory and voluntary

19 Potential Problems Associated with Cost Sharing Do effort reports capture cost shared effort (both mandatory and voluntarily committed)? Are the same cost sharing funds used to meet the matching requirements on more than one project?

20 A-110: Program Income Recipients must account for income related to projects financed by the federal government Recipients may retain and use income if allowed by agency by: ◦ Adding to the project to further the objectives ◦ Financing the non-federal share ◦ Deducting from the total cost of the project If agency does not specify in award: 1.Support research - added to project 2.All others - deducted from the cost of the project

21 A-110: Program Income (continued) No obligation to government for income earned after end of project Costs for generation of income may be deducted from gross income No obligation to government for income earned from license fees and royalties

22 A-110: Budget and Program Changes Budget and Program Plan Revisions Deviations must be reported and prior approval requested Prior approval required in non- construction awards as follows: ◦ Change of scope ◦ Change of Key Personnel

23 A-110: Budget and Program Changes (continued) ◦ Absence of 3 months or 25% reduction in time of Key Personnel ◦ Additional funding ◦ Transfer of F&A to direct or vice versa ◦ Inclusion of costs requiring prior approval in Circulars ◦ Transfer of funds allotted for training ◦ Subawards

24 A-110: Budget and Program Changes (continued) No other prior approvals can be imposed Agencies authorized to waive approvals except for: ◦ Change in scope of work ◦ Additional funding Transfers between budget line items may be restricted if award is $100,000 or more and transfer exceeds 10% of approved budget Agency should respond to request within 30 days from the date of receipt of the request

25 Expanded Authorities Federal Demonstration Partnership Group of Universities, Federal Agencies, and Others (including NCURA) focused on improving Federal grants management Expanded Authorities Delegated approvals to the grant recipients in 7 areas: 1.Pre-award Costs 2.Domestic Travel 3.Foreign Travel 4.Equipment 5.Carry-Over of Funds 6.No-Cost Extensions 7.Rebudgeting Not all agencies or programs have delegated these approvals

A-110: Reports And Records Sets forth procedures for monitoring and reporting financial and program performance and the necessary standard reporting forms (including record retention requirements). (See C. 50 to 53) Monitoring And Reporting Program Performance Recipients are responsible for: ◦ Managing and monitoring each project, program, subaward, function or activity supported by the award; and ◦ Ensuring subrecipients have met the audit requirements delineated in C. 26. Time of reporting: ◦ Not more frequently than quarterly or less frequently than annually.

A-110: Reports And Records (Cont’d) When required, performance reports (technical reports) shall generally contain: ◦ Comparison of actual accomplishments with goals established for the period, the finding or both; ◦ Reasons why established goals were not met; and ◦ Other information including, when appropriate, analysis and explanation of cost overruns or high unit costs. Recipient shall notify the federal awarding agency when: ◦ Events occur that have a significant impact on the project or program; and/or ◦ Problems, delays or adverse conditions occur that materially impair the abilityto attain program objectives. Site visits

A-110: Reports And Records (Cont’d) Financial Reporting Standard forms are specified for obtaining financial information. Financial Status Report (SF-269) ◦ Federal Agency has option to use Request for Advance or Reimbursement or Cash Transactions Report if they provide adequate information. ◦ FSR is required at completion of project. ◦ May require cash or accrual basis. ◦ Timing: 30 days after the conclusion of each specified reporting period for quarterly and semi-annual reports and within 90 days of annual or final reports.

A-110: Reports And Records (Cont’d) Report of Federal Cash Transactions (SF-272) ◦ For advances through letter of credit and reporting within 15 days after each quarter. ◦ May require explanation of cash in excess of 3 days needs, legislative requirements, or accounting standards questions. ◦ Machine readable formats allowed. Request for advance or reimbursement (SF-270) ◦ Used only where letter of credit or predetermined advance method is not used.

A-110: Reports And Records (Cont’d) Retention And Access Requirements For Records Federal awarding agencies shall not impose any other record retention or access requirements upon recipients. Financial records, supporting documents, statistical records and all other records shall be retained for a period of THREE years, with the following exceptions: ◦ Litigation requires retention until all matters have been resolved; ◦ Real property and equipment records retained three years after final disposition of the property; and/or ◦ When records are transferred to the agency, the retention requirement ends. ◦ F&A cost rate proposals, cost allocation plans have unique requirements.

A-110: Reports And Records (Cont’d) With agency approval, copies can be substituted for original records. When does the clock start? ◦ Awards - Date of submission of the final expenditure report or, for awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report; ◦ F&A Costs - Date of submission of a proposal for negotiation; the end of the fiscal year if not submitted for negotiation. Access to records by agency, inspector general, or comptroller general is allowable. Agencies may not limit public access to recipients' records without justification.

A-110: Termination And Enforcement Sets forth uniform suspension, termination and enforcement procedures (See C. 60 to 62) Termination ◦ By the federal awarding agency ◦ By the federal awarding agency with the consent of the recipient ◦ By the recipient Enforcement ◦ Remedies for noncompliance ◦ Hearings and appeals ◦ Effects of suspension and termination ◦ Relationship to debarment and suspension (See B,13) Regulations provide information on how to proceed with termination for cause and termination for convenience

A-110: Subpart D - After Award Requirements Purpose: ◦ Establish procedures for close-outs, disallowances and adjustments Close-out: ◦ All reports must be submitted within ninety days ◦ All obligations must be liquidated within ninety days ◦ Agency must make prompt payment ◦ Recipient shall refund any unobligated cash advance ◦ Agency makes adjustments after reports are received ◦ Recipient must account for real and personal property ◦ Agency retains right to recover disallowances until final audit Subsequent Adjustments ◦ Close-out does not affect:  Right of agency to disallow and recover funds  Obligation of recipient to return funds due as a result of refunds  Audit requirements  Property management requirements  Record retention

A-110: Subpart D - (Cont’d) Collection of amounts due Funds paid to recipient in excess of final award, if not returned agency, may: ◦ Be offset against other awards ◦ Withhold advance payments ◦ Other actions permitted by statute ◦ Agency may charge interest

A-110: Appendix A Provisions for contracts awarded by recipient. All contracts, awarded by a recipient shall contain the following provisions (as applicable): ◦ Equal Employment Opportunity ◦ Copeland “Anti-Kickback” Act ◦ Davis-Bacon Act ◦ Contract Work Hours and Safety Standards Act ◦ Rights to Inventions Made Under a Contract or Agreement ◦ Clean Air Act ◦ Byrd Anti-Lobbying Amendment ◦ Debarment and Suspension

Recap of OMB Circular A-110: Highlights Uniform Administrative Requirements for Grants and Agreements with Institutions of Higher Education and Other Non-profit Organizations Financial and programmatic management Cost sharing Program income Property standards Procurement standards Reporting and Records

Resources US Government Printing Office/FDSYS (electronic CFRs) ◦ ◦ Select the year ◦ Select “Title 2 – Grants and Agreements ◦ Pick your type – pdf, XML, or other ◦ In the pdf, scroll down to about page 4, that’s where Part 215 (A-110) begins FDSYS XML link for A-21 ◦ chapII.xml

Contact Information Maggie Griscavage Acknowledgment: ◦ Liberally borrowed, by permission, from the NCURA FRA Workshops. 38