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Subaward Hot Topics

Subaward Hot Topics. NCURA Region IV Spring Meeting April 29, 2014. Tyra Darville-Layne, Senior Grant & Contract Officer Northwestern University td-layne@northwestern.edu Andrea Marshall, Principal Grant Administrator University of Minnesota pete1518@umn.edu. Learning Objectives .

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Subaward Hot Topics

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  1. Subaward Hot Topics NCURA Region IV Spring Meeting April 29, 2014 Tyra Darville-Layne, Senior Grant & Contract Officer Northwestern University td-layne@northwestern.edu Andrea Marshall, Principal Grant Administrator University of Minnesota pete1518@umn.edu

  2. Learning Objectives • Review the OmniCircular guidance for subawards, and provide strategies to implement the new requirements into the subaward process flow • Address the NIH Subaccount impact on subawards and provide institutional implementation strategies • Review the HHS Pilot on Whistleblower Protections flow down requirements for subawards

  3. OmniGuidance is a combined, “simplified” version of 8 previous circulars 2 CFR 200 Subpart A – Acronyms and Definitions Subpart B – General Provisions Subpart C - Pre-award Requirements & Contents of Federal Awards Subpart D – Post Federal Award Requirements Subpart E – Cost Principles Subpart F – Audit Requirements Appendix

  4. OmniGuidance Implementation Plan 2015 2013 2014 2016 12/26/14 Implementation (all but audit) 12/26/13 Release 6/26/14 Agency plans due to OMB 7/1/15 Audit provisions go into effect for UMN Understand (OmniGuidance) Influence Plan (OmniGuidance) Understand (Agency) Plan (Agency) Implement Evaluate Refine

  5. 2 CFR 200.330 Subrecipient & Contractor Determinations • Pass-through entity must determine whether funding should be issued as a subaward or vendor agreement. • Regardless of what agreement is called, the nature of the work will be used to dictate whether 200.93 (subaward) or 200.22 (contract) • Possible concerns: • Each agency may require entities to comply with additional guidance to support their classifications • Possible solution: • COGR to proposal standard way to document this determination to Federal Government

  6. 200.331 Requirements for pass-through entities F&A Requirements • Sponsors (both Prime and Pass-Through) obligated to honor subrecipients negotiated F&A rate • Subrecipients without a negotiated rate may charge 10% MTDC or may negotiate rate with Pass-Through entity

  7. 200.331 Requirements for pass-through entities Required Data Elements that must be in Subaward • 1. Subrecipient Name (must match registered name in DUNS) • 2. Subrecipient DUNS Number • 3. Federal Award Identification Number (FAIN) • 4. Federal Award Date (date award was signed by the authorized • official of prime sponsor) • 5. Subaward Period of Performance • 6. Amount of Federal Funds Obligated by this action • 7. Total Amount of Federal Funds Obligated to the subrecipient • CONTINUED ON NEXT SLIDE

  8. 200.331 Requirements for Pass-Through entities Required Data Elements that must be in Subaward • 8. Total Amount of Federal Award • 9. Federal award project description, as required to be responsive to FFATA • 10. Name of Federal awarding agency, pass-through entity and contact information for awarding official • 11. CFDA Number and Name; the pass-through entity must identify the dollar amount made available under each Federal award and the CFDA number at the time of disbursement • 12. Identification of whether the award is R&D • 13. Indirect cost rate for the Federal award (including if the de minimis rate of 10% MTDC is charged)

  9. 200.331 Requirements for Pass-Through entities Requirements of Subaward Document • Subaward must list all requirements imposed by pass-through entity so that award is used in accordance with Federal statutes, regulations and the terms & conditions of Federal award. • Any additional requirements that pass-through entity imposes to subrecipient • Must specifically list any financial and performance reports that are required • Requirement that subrecipient permit pass-through entity and auditors to have access to subrecipient’s records & financial statements as necessary • Terms and conditions for subaward closeout

  10. 200.331 (b) Requirements for Pass-Through entities Risk Assessment • Each Pass-Through entity required to use Federal Audit Clearinghouse to verify audit reports * Items to consider when assessing risk: • The subrecipient’s prior experience with the same or similar subawards • The results of previous audits (including whether subject to Single Audit Requirements) Threshold changed from $500K to $750K • Whether the subrecipient has new personnel or new or substantially changed systems • The extent and results of Federal award agency monitoring (see 200.205) • Pass-Through entity must document acceptance of management plan

  11. 200.331 (c) Requirements for Pass-Through entities Subaward Terms and Conditions • Include additional terms and conditions and/or impose specific conditions in response to audit findings

  12. 200.331 (d) Requirements for Pass-Through entities Monitoring Subaward • Pass-through entities are required to: • Review financial and programmatic reports required in subaward • Follow-up and ensure that subrecipient takes timely and appropriate action on all deficiencies pertaining to the Prime Federal award detected through audits, on-site reviews, and other means. • Issue a management decision for audit findings pertaining to the Federal award provided to subrecipient from Pass-Through entity

  13. 200.331 (d) Requirements for Pass-Through entities Monitoring Subaward • Review and decision on management decision must occur within six months after audit is available in Federal Audit Clearinghouse • Institutions may decide to accept corrective action plan documented by subrecipient, may modify existing subaward(s), or may choose to write additional requirements into future subawards. • Whatever option institution chooses, documentation of decision must be maintained.

  14. 200.331 (e) Requirements for Pass-Through entities Monitoring Tools • Depending upon the risk assessment, recommended monitoring tools: • Providing subrecipients with training and technical assistance on program-related matters • Performing on-site reviews of the subrecipient’s program operations

  15. 200.332 Fixed Amount Subawards • Issuance of fixed amount subaward requires Federal award agency prior approval • Must not exceed the Simplified Acquisition Threshold ($150K) • Subaward must meet the requirements for fixed amount awards outlined in 200.201 Use of grant agreements (including fixed amount awards), cooperative agreements, and contracts • * Relies more on performance than compliance for accountability • Possible concerns: Delay of subaward issuance while approval is pending and increases administrative burden for all parties.

  16. Implementation Strategies • Risk Assessment tools • * Modify subrecipient questionnaires and checklists to incorporate additional risk elements • Subaward templates and issuance * Watch for FDP subaward template revisions • Monitoring: determine who will conduct site visits and who will provide resources

  17. NIH Transition to PMS Subaccounts • NIH Notice Number: NOT-OD-13-112 and NOT-OD-13-120 • New DHHS Requirement: segregate letter of credit draws on an award-by-award basis • Removes ability to “pool” expenses and perform drawdown for all awards at once • Enables the government to do award-by-award burn rate calculations (enhance ability to detect fraud, waste and abuse)

  18. NIH Transition to PMS Subaccounts • Federal FY14 • NIH issues competitive awards in “P” accounts • Each NIH competitive awards (new or renewal) will be set up as new in financial system • Federal FY15 • NIH non-competing awards (except those in their final year) will be divided by NIH into two “mini” competitive segments • (1) Start of original competitive segment – end of budget period awarded in FY14 • (2) “Type 4” = balance of original competitive segment • Type 4s will be set up as “new” in the financial system

  19. Institutional Implementation Strategies • Assess the potential impact • (human resources, loss of revenue) • Consider existing enterprise system tools • Identify additional report needs to assist Research Office, Grant Accounting, and Units • Communication Strategy

  20. Institutional Implementation Strategies: Competitive awards • Renewals are set up as brand new awards in financial system • Establish new Subaward under each Renewal award • Establish new PO # (subaward ID #), and start new cumulative amount for FFATA reporting

  21. Institutional Implementation Strategies: Non-competing • Non-competing awards will be set up as New award in financial system • New Subaward will be issued (even though it’s mid-Project Period) • Since new subaward is issued: start new cumulative amount for FFATA Reporting • FCOI information will be transferred from old award to new award (Investigator training and disclosure information) • Awards that have automatic carry forward: funding will be added to award once NIH transfers balance to new DOC ID; amendment to subaward will be issued authorizing the carry forward

  22. HHS Whistleblower Protections Pilot • Congress has enacted many whistleblower protection statutes to encourage employees to report fraud, waste, and abuse. You should be aware that the latest whistleblower protection statutes went into effect on July 1, 2013. The statute, 41 U.S.C. 4712, applies to all employees working for contractors, grantees, subcontractors and subgrantees on federal grants and contracts. The National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2013 (Pub. L. 112-239, enacted January 2, 2013) mandates a pilot program entitled "Pilot Program for Enhancement of Contractor Employee Whistleblower Protections".

  23. HHS Whistleblower Protections Pilot • This program requires all grantees, their subgrantees and subcontractors to: • 1. Inform their employees working on any Federal award they are subject to the whistleblower rights and remedies of the pilot program; • 2. Inform their employees in writing of employee whistleblower protections under 41 U.S.C. 4712 in the predominant native language of the workforce; and, • 3. Contractors and grantees will include such requirements in any agreement made with a subcontractor or subgrantee.

  24. HHS Whistleblower Protections Pilot • The statute (41 U.S.C. 4712) states that an "employees of a contractor, subcontractor, grantee [or subgrantee] may not be discharged, demoted, or otherwise discriminated against as a reprisal for "whistleblowing". In addition, whistleblower protections cannot be waived by any agreement, policy, form or condition of employment. • Whistleblowing is defined as making a disclosure "that the employee reasonably believes is evidence of any of the following: • * Gross mismanagement of a Federal contract or grant; • * A gross waste of Federal funds; • * An abuse of authority relating to a Federal contract or grant; • * A substantial and specific danger to public health or safety; or, • * A violation of law, rule, or regulation related to a Federal contract or grant (including the competition for, or negotiation of, a contract or grant).

  25. HHS Whistleblower Protections Pilot • To qualify under the statute, the employee's disclosure must be made to: • * A Member of Congress, or a representative of a Congressional committee; • * An Inspector General ; • * The Government Accountability Office; • * A federal employee responsible for contract or grant oversight or management at the relevant agency; • * An official from the Department of Justice, or other law enforcement agency; • * A court or grand jury; or, • * A management official or other employee of the contractor, subcontractor, grantee, or subgrantee who has the responsibility to investigate, discover or address misconduct.

  26. HHS Whistleblower Protections Pilot • The requirement to comply with, and inform all employees of, the "Pilot Program for Enhancement of Contractor Employee Whistleblower Protections" is in effect for all grants, contracts, subgrants and subcontracts issued beginning July 1, 2013 through January 1, 2017.

  27. Equal Opportunity: Final Rule • 11. Does the Final Rule still permit my company to incorporate the Equal Opportunity (EO) Clause into subcontracts by reference? • Yes. The Final Rule permits contractors to incorporate the EO Clause into subcontracts by reference, but only by citing to the EO Clause in the regulations AND including the following sentences in bold text: • "This contractor and subcontractor shall abide by the requirements of 41 CFR 60-741.5(a). This regulation prohibits discrimination against qualified individuals on the basis of disability, and requires affirmative action by covered prime contractors and subcontractors to employ and advance in employment qualified individuals with disabilities." • http://www.dol.gov/ofccp/regs/compliance/faqs/503_faq.htm#Q17

  28. Equal Opportunity: Final Rule • § 60-741.1 Purpose, applicability, and construction. • (a) Purpose. The purpose of this part is to set forth the standards for compliance with section 503 of the Rehabilitation Act of 1973, as amended (29 U.S.C. 793), which prohibits discrimination against individuals with disabilities and requires Government contractors and subcontractors to take affirmative action to employ and advance in employment qualified individuals with disabilities.

  29. Equal Opportunity: Final Rule • (b) Applicability. This part applies to all Government contracts and subcontracts in excess of $10,000 for the purchase, sale or use of personal property or non-personal services (including construction): Provided, That subpart C of this part applies only as described in § 60-741.40(a). Compliance by the contractor with the provisions of this part will not necessarily determine its compliance with other statutes, and compliance with other statutes will not necessarily determine its compliance with this part: Provided, That compliance shall also satisfy the employment provisions of the Department of Labor's regulations implementing section 504 of the Rehabilitation Act of 1973 (see 29 CFR 32.2(b)) when the contractor is also subject to those requirements.

  30. Equal Opportunity: Final Rule • (c) Construction—(1) In general. Except as otherwise provided in this part, this part does not apply a lesser standard than the standards applied under title I of the Americans with Disabilities Act (ADA) of 1990, as amended, (42 U.S.C. 12101et seq.) or the regulations issued by the Equal Employment Opportunity Commission pursuant to that title (29 CFR part 1630). The Interpretive Guidance on Title I of the Americans with Disabilities Act set out as an appendix to 29 CFR part 1630 issued pursuant to that title may be relied upon for guidance in interpreting the parallel non-discrimination provisions of this part.

  31. For more information… • 1. Final Guidance (OMNI) • https://s3.amazonaws.com/public-inspection.federalregister.gov/2013-30465.pdf • 2. NIH Notice NOT-OD-13-120 • http://grants.nih.gov/grants/guide/notice-files/NOT-OD-13-120.html • 3. NIH FAQ’s • http://grants.nih.gov/grants/payment/faqs.htm • 4. The Federal Demonstration Partnership (FDP) • http://sites.nationalacademies.org/pga/fdp/index.htm • 5. HHS Whistleblowers Protections Pilot – AHRQ implementation • http://www.ahrq.gov/funding/grant-mgmt/whistleblowers.html • 6. Section 503 Crosswalk: Existing Rule vs. Final Rule [Dept. of Labor] • http://www.dol.gov/ofccp/regs/compliance/factsheets/Section503_Crosswalk_QA_508c.pdf

  32. How can you help… • Collaborate with your institution’s Pre- and Post-Award offices • Attend and participate in meetings, webinars, etc. • Remember to submit your questions to the appropriate forums • Engage, embrace and empower your research community

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