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Reporting Requirements under ARRA and Beyond

Reporting Requirements under ARRA and Beyond. Merril Oliver moliver@gov.state.md.us Maryland Governor’s Grants Office www.grants.maryland.gov Developed in partnership with Liz Johnson ljohnson@ffis.org Federal Funds Information for States www.ffis.org September 18, 2009.

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Reporting Requirements under ARRA and Beyond

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  1. Reporting Requirements under ARRA and Beyond Merril Oliver moliver@gov.state.md.us Maryland Governor’s Grants Office www.grants.maryland.gov Developed in partnership with Liz Johnson ljohnson@ffis.org Federal Funds Information for States www.ffis.org September 18, 2009

  2. Presentation Overview • Reporting requirements definitions and history • Federal Funding Accountability and Transparency Act (FFATA) • American Recovery and Reinvestment Act (ARRA) • Statute & OMB guidance • Reporting processes & time frame • Federal agency-specific guidance • Challenges to states in implementing ARRA reporting requirements • How FFATA requirements will impact states in future and what can be done about it now • Experiences from Maryland

  3. Key Reporting Definitions • Prime Recipient – non-federal entities that receive funding awards directly from the federal government. • States • Localities • Subrecipient – non-federal entity that receives federal award funding through another non-federal entity, to carry-out a federal program • Does not include individual program beneficiaries or vendors • Localities can be prime or subrecipients depending on awards. • Vendor – a dealer, distributor, merchant, or other seller providing goods or services for the conduct of a federal program. Do not participate in substantive work of program. Provide the same type of services to many different purchasers.

  4. Reporting Requirements: History of FFATA • On September 26, 2006, FFATA enacted (P.L. 109-282) • Sponsored by then-Sen. Obama and Sen. Coburn • Purpose was to increase transparency of federal funding awards (grants, loans, cooperative agreements, contracts & credit card transactions) through creation of a publicly available online database that includes information on all entities receiving federal funds – www.usaspending.gov • Differentiated between primary non-federal entity to receive award and subsequent subawards • More details can be found in FFIS Issue Brief 08-58(http://ecom.ncsl.org/ffis/subs/ib/2008/IB08-58.pdf) and 09-16 (http://ecom.ncsl.org/ffis/subs/ib/2009/IB09-16.pdf) • Link to legislation: http://frwebgate.access.gpo.gov/cgi- bin/getdoc.cgi?dbname=109_cong_public_laws&docid=f:publ282.109

  5. Reporting Requirements: History of FFATA (2) • FFATA laid out required data elements for primary award reports (See Table) • As of January 1, 2008, federal agencies report on prime awards in www.usaspending.gov • Data is incomplete, contains many errors • FFATA legislated OMB to conduct a pilot program for determining subaward reporting requirements and procedures • Under FFATA, prime recipients are required to report on subawards • In subsequent guidance, OMB directed subrecipients to obtain DUNS numbers and register in the Central Contractor Registration (CCR)

  6. FFATA Subaward Pilot • Pilot occurred in November, 2008. • Analysis of pilot completed, but release of information currently on hold. “These pilots did not generate sufficient information on which to base an operational model or project plan for how subaward information should be collected. They also did not generate sufficient information on which to base an accurate assessment of the burden placed on award recipients.” Peter Orzag, Director of OMB, April 27, 2009 • Reporting deadline for subawards, set as January 1, 2009, in FFATA was not met. OMB has authority to extend 18 months = July 1, 2010.

  7. FFATA: On Hold for Now, but Reporting Will Occur in Future • FFATA requirements put on back burner to accommodate for ARRA • However, as ARRA funding is distributed and the reporting process smoothed-out, FFATA requirements will eventually be implemented and recipients will need to comply. • FFATA bill sponsor, Tom Coburn, already concerned that FFATA has been put on hold • Link to letter – http://tinyurl.com/o2jzpg -- includes link to OMB’s response

  8. Why was FFATA put on hold? • ARRA legislated ….. • Contained numerous provisions on transparency and reporting • A list of all provisions related to reporting requirements in ARRA can be found in addendum • Recipient reporting requirements contained in ARRA Section 1512(c) • Implementing Guidance has been released by OMB

  9. ARRA Section 1512(c) – Recipient Reporting Requirements The bill requires all recipients of recovery funds (grants, loans, and contracts) from a federal agency to report the following: • Total amount of recovery funds received from the agency. • Amount of funds expended or obligated to projects • A detailed list of all projects for which recovery funds were expended, including: • The name and description of the project. • An evaluation of the completion status of the project. • An analysis of the number of jobs created or retained by the project. • Detailed information on any subcontracts or subgrants, including data elements required by the Federal Funding Accountability and Transparency Act of 2006 (Public Law 109-282).

  10. ARRA Recipient Reporting Requirement Parameters • Applies only to programs in Division A of ARRA, not to mandatory, tax programs, or programs in Division B such as trade adjustment assistance, UI, broadband, TANF emergency contingency funding, and premium assistance for COBRA. • List of all program subject to section 1512 (c) reporting requirements is supplement to OMB guidance M-09-21 • http://www.whitehouse.gov/omb/assets/memoranda_fy2009/m09-21-supp1.pdf

  11. ARRA Reporting Guidance - OMB Reporting requirements implemented by OMB guidance, M-09-21, released June 22, 2009: www.whitehouse.gov/omb/recovery_default/ Clarifications and FAQs on guidance: http://www.recovery.gov/?q=content/recipient-reporting (A list of all OMB guidance on ARRA reporting requirements is included in addendum to this presentation)

  12. What does OMB Guidance Include? • Definition of prime recipients, subrecipients and vendors • In ARRA, subrecipient requirements apply only to “first-tier” subrecipients • Description of prime recipient responsibilities • Ultimately responsible for data -- quality, completeness, timeliness • Data reviews and monitoring procedures • Centralized or decentralized reporting options • Can delegate reporting to subrecipients or not • Cannot delegate reporting to vendors • Required Data Elements • Details on how to submit reports • Deadlines and timeframe For more detailed information, see FFIS Issue Brief 09-24 at http://www.ffis.org/452501/497155.html

  13. Federal Agency Prime Recipient Vendor subrecipient Vendor ARRA Reporting Tree

  14. ARRA Data Elements See Table

  15. Jobs Data Number on jobs created or retained = Total hours worked in jobs created or retained # hours in full time schedule • Prime recipients must aggregate jobs data from subrecipients and vendors • Only report on jobs directly funded by ARRA monies, not indirect or induced jobs. • “Employees who are not directly charged to Recovery Act supported projects/activities, who, nonetheless, provide critical indirect support, e.g., clerical/administrative staff preparing reports, institutional review board staff members, departmental administrators, are NOT counted as jobs created/retained.” OMB guidance, M-09-21, p.36

  16. Submitting ARRA Reports • Registration at www.federalreporting.gov began on August 17, 2009 • Three methods for submitting reports • Directly online at www.federalreporting.gov • Excel template • Custom software system extraction in XML • Excel template and XML schema available for download at https://www.federalreporting.gov/federalreporting/downloads.do

  17. How to Find Help Submitting Reports? • Reference documents available for downloading, including registration guide and data model, at federalreporting.gov • Federalreporting.gov has a list of FAQs • Service desk – currently open from 9am-5pm Mon.-Fri., will be open around the clock during October 877-508-7386 or email at Support@FederalReporting.gov • Information provided directly in Excel report template. • Federal liaison in each state from end of September - October

  18. Quarterly Deadlines and Timeframe Timeframe for report submission and correction. Days refer to days following the end of each quarter: • Days 1-10: prepare and submit data • Days 11-21: Review and correct submitted data. Federal agencies in “view-only” mode. • Days 22-29: Federal agencies review data, ask questions, “unlock” data for recipient edits. • Day 30: Data released to public on recovery.gov Mistakes that are caught after the 30th day can be corrected in next quarterly report.

  19. How will ARRA reports be used? • Will be posted on www.recovery.gov • Will be posted on Federal Agency websites • Not clear if all elements reported on federalspending.gov will be posted for public • State websites • Links to all state website available at: http://www.recovery.gov/?q=content/state-local-tribal-and-territorial-resources&mode=map • Analysis and ranking of state websites available from Good Jobs First at: http://www.goodjobsfirst.org/news/article.cfm?id=396

  20. What Happens If My State Does Not Comply? “Federal awards, like most legal contracts, are made with stipulations outlined in the award’s term and conditions. Non-compliance with the reporting requirement as established under section 1512 of the Recovery Act is considered a violation of the award agreement because awards made with Recovery funds have a specific term requiring such compliance.” OMB Guidance M-09-21, p.17

  21. Agency-Specific ARRA Reporting Guidance • Additional agency-specific guidance will also be released. “…outside of Section 1512 of the Recovery Act… recipients will have to comply with any reporting as outlined in the award agreement. In these areas, recipients should rely on program-specific guidance and instructions issued by the relevant federal agency. Thus, it is anticipated that federal agencies will, as appropriate, issue clarifying guidance to funding recipients. Additional guidance for Recovery funding recipients must be in accordance with OMB guidance.” - OMB Guidance, M-09-21, June 22, 2009. p.6

  22. Agency-Specific ARRA Reporting Guidance (2) • Guidance that has been released to date not extensive, not posted centrally for easy access: • Department of Labor, Employment and Training Administration guidance includes requirement for hard copy of reporting info for June 30, 2009. http://wdr.doleta.gov/directives/corr_doc.cfm?docn=2793 • TEFAP guidance summarizes parts of OMB memo that altered previously released guidance or impose new reporting requirements. http://www.fns.usda.gov/fns/recovery/memos/TEFAP_080309.pdf • National School Lunch Program guidance. http://www.fns.usda.gov/cnd/Governance/Policy-Memos/2009/SP_36-2009_os.pdf

  23. Challenges to States from Agency-Specific ARRA Guidance • No deadlines exist for release of agency guidance. States may need to adjust “after the fact” • Information flow will be difficult, as there is no central hub listing all agency guidance across federal government. • Agency use of information • “Federal agencies may use recipient reports to help assess compliance with the terms and conditions of the individual award agreements, further assess risks and to determine when to release the remaining funds.” OMB Guidance, M-09-21, June 22, 2009. p.26

  24. Prime Recipient Responsibilities under ARRA Pose Challenges to States • Prime recipients are ultimately responsible for accurate, complete, and timely submission of data. • OMB states that prime recipients should develop internal controls to ensure data quality. • Prime recipients may require subrecipients to self-report, but must develop system to check data and monitor process to ensure no duplicate reporting. • Prime recipients must review data after report submission deadline. Look for material omissions and significant reporting errors.

  25. Benefits and Challenges to Centralized or Decentralized Approach? Prime recipients and must also adapt to the reporting approach taken by the state. Each approach has pros/cons: • Centralized approach – single state agency or office (budget office, Governor’s office) collects prime recipient data from all state agencies and then reports into federalreporting.gov itself • Decentralized approach – no single point of entry for submitting required data to FederalReporting.gov. Allows for multiple parties at the prime recipient level to enter data • States must develop process to ensure that multiple agencies do not inadvertently create separate data records reporting on the same activity

  26. ARRA Reporting Requirements Pose Challenges for States • Reconciliation with other financial reports could become very difficult • Subaward reporting will bring out need for closer monitoring of subrecipients • New breadth and depth of data may have audit implications • Registering on CCR may lead to violations of internal controls • States may need to better manage and use DUNS numbers • And more…..

  27. ARRA Reporting Requirements Pose Challenges for States DUNS Issues • DUNS Tree needs to continuously updated and managed • Under D&B policies, there is no ability to delete records that don’t belong in the State’s DUNS family tree.  As a result, there is the potential for registrations to the CCR and FederalReporting.gov that will be inappropriately associated with the State. • There is no process by which an entity such as a state can restrict assignment of DUNS to the parent DUNS number or remove an entity that has been inappropriately associated with the state.

  28. ARRA Reporting Requirements Pose Challenges for States CCR Issues • CCR allows registration in its database if the registrant can provide a valid DUNS number, but it does not require evidence that the registrant is a valid member of the parent DUNS family tree.  This will require extra diligence on State’s to manage CCR registrations and have some form of centralized CCR report. • State’s have been unable to obtain a report of registrations in the CCR database that are associated with the state’s primary government. • In general, CCR registration compromises internal controls by providing access to banking information to personnel outside the “control” environment.  This has been an ongoing issue and should be made note of in any grant file to reduce the audit finding impact.

  29. ARRA Reporting Requirements Pose Challenges for States FederalReporting.gov Issues • A Central Submitter (CS) registers on FedRpt.gov and associates themselves with another DUNS number by requesting an FRPIN, FedRpt.gov system automatically notifies the “owner” of that DUNS number and the owner has the option to reject the CS. • IF the CS is rejected or revoked at anytime, they are rejected from reporting for the ENTIRE Duns tree

  30. ARRA and Federal Transparency Perhaps the biggest consequence of ARRA reporting requirements is that they will set the stage for more permanent reporting requirements, as legislated by FFATA

  31. When ARRA winds down, FFATA will wind up • “Once subaward reporting capabilities are in place for Recovery Act funds and these data are displayed on Recovery.gov, the Administration intends to begin broadening subaward report requirements to all Federal funding, to comply with the Transparency Act.” Peter Orzag, Director of OMB, April 27, 2009

  32. A few details on FFATA and how it differs from ARRA • Subaward reporting requirements are not limited to first-tier subrecipients in FFATA, as they are in ARRA • Data is reported monthly, not quarterly as for ARRA • Experiences of pilot participants indicate that states have significant capacity issue. • Large gaps in information collected from subrecipients • Data quality issues

  33. State Implications of FFATA Requirements • FFATA has more frequent reporting deadlines • Currently stands that primes would have to report on awards to subrecipients within 30 days of obligation • Talk of possibly having “real time” reporting • When FFATA requirements are enforced, states will have to report much further down the line on funds distributed. • Not limited to first-tier sub-recipients • Subrecipient data may be more extensive than under ARRA • FFATA states that subrecipient reporting should be done in the same manner as prime recipient reporting • Whereas ARRA has fewer reporting requirements for subrecipients than prime recipients, this may not be the case with FFATA requirements.

  34. State Implications of FFATA Requirements (2) • It is likely that the reporting processes and procedures for FFATA will mirror those being set-up for ARRA • Centralized or decentralized options among states – with one central portal for submitting data • May be influenced by state experiences under ARRA • Option to delegate reporting requirements to subrecipients is possible (although view on this was only about 50-50 in pilot) • Data quality controls and review procedures will likely hold

  35. Where do states go from here? • Building on ARRA for future grants reporting • Recovery Act data system set-up in a way that would accommodate more comprehensive reporting. • Will states be able to incorporate FFATA requirements into structures / processes developed during ARRA reporting?

  36. Experiences in Maryland • Centralized Governor’s Grants Office www.grants.maryland.gov • Increase and Track all Federal grant dollars coming to Maryland to support Governor O’Malley’s policy priorities. • Deliver Comprehensive Training Program for State, Local, Municipal Gov’t, Non-profit and Ed Sectors • Train for Pre- and Post-award grants management • FFATA Reporting Requirements training delivered 2006 • Train for ARRA opportunities, preparation, implementation, reporting delivered spring 2009 • Track Single Audit Findings • Offer training targeted to audit finding reduction

  37. Experiences in Maryland • Governor O’Malley’s State Stat Program www.statestat.maryland.gov • Accurate & timely intelligence, shared by all • Rapid deployment of resources • Effective tactics and strategies • Relentless follow-up and assessment

  38. Experiences in Maryland • Governor O’Malley’s Recovery Program www.recovery.maryland.gov • Recovery Main • State Funding Overview • Detailed Map of MD Spending • Search Grants, Contracts and Loan Opportunities • Centralized ARRA Reporting

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