TRIBAL INFORMATION
Q. If we wanted to provide subgrants to community partners is there a threshold that would trigger an audit for those entities?”
A. The only audit threshold in 2 CFR 200 is the Single Audit Threshold. If an entity expends more than $750k in one year, then they are subject to the Single Audit Act.
Please do also take a look at 2 CFR 200.332 – Requirements for Pass-Through Entities. Section (b) is regarding assessment of risk.
APPLICATION PROCESS
Q. Please explain the 80% sub-award requirement to pass-through entities:
A. A non-Federal entity (NFE) may concurrently receive Federal awards as both a recipient (direct grant) and as a pass-through entity (PTE). In each of these roles, the NFE has separate and distinct requirements and responsibilities.
The requirement under the NOFO that a minimum of 80% of all funding to a PTE must be competitively sub-awarded to community-based organizations, or other partners serving disadvantaged communities, specifically relates to the NFE’s role as a pass through entity. The portion of the award that it receives as a direct recipient as such, is not included in determining the 80% minimum requirement.
Q. Please explain whether matching funds waiver applies to pass-through funding:
A. Sub-paragraph C.3 Match Waiver (found under the Eligibility Information of the NOFO - page 6) states, “Applicants receiving match waiver approval that pass-through funding (sub-award) for work in disadvantaged communities must pass the match waiver to sub-awardees performing the work.” In other words, match waiver does apply to pass-through funding; with the requirement that the PTE must pass this match waiver to the sub-awardees.
FUNDING
Q. How will grantees be reimbursed once the project has been awarded?
A. A Recipient may be paid either by advance or reimbursable payments. They must submit a Standard Form 270 (SF-270), Request for Advance or Reimbursement, no more than once monthly. The SF-270 must include a list of the expenses and amounts included in the submission.
Advance payments must not exceed the minimum amount needed or no more than is needed for a 30-day period, whichever is less. If the Recipient receives an advance payment and subsequently requests an advance or reimbursement payment, then the request must clearly demonstrate that the previously advanced funds have been fully expended before the Forest Service can approve the request for payment. Any funds advanced, but not spent, upon expiration of the award must be returned to the Forest Service.
Reimbursable payments are based on the Recipient’s actual cash disbursement.
Q. Regarding the Administrative and Overhead de minimis 10% rate, should this be assessed on our staff time for the project, or as a percentage of the project's total cost?
A. For non-Federal entities (NFEs) without a current negotiated indirect cost rate agreement (NICRA), they may elect to charge a de minimis rate of 10% of modified total direct costs (MTDC).
Modified Total Direct Cost (MTDC) means all direct salaries and wages, applicable fringe benefits, materials and supplies, services, travel, and up to the first $25,000 of each subaward (regardless of the period of performance of the subawards under the award).
MTDC excludes equipment, capital expenditures, charges for patient care, rental costs, tuition remission, scholarships and fellowships, participant support costs and the portion of each subaward in excess of $25,000. Other items may only be excluded when necessary to avoid a serious inequity in the distribution of indirect costs, and with the approval of the cognizant agency for indirect costs.
Sample Budget with De Minimis indirect cost rate:
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Personnel
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$75,000
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Subtotal of MTDC Line Items (personnel, fringe, supplies)
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$92,000
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Fringe
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$15,000
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Supplies
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$2,000
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Allowable De minimis Indirect rate (10%)
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$9,200.0
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TOTAL AWARD REQUEST
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$101,200
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Q. What happens if a matching project is not fully complete at the end of 5 years?
A. If “match” project cannot be completed, proportional decrease.
Q. If a local foundation becomes a pass through, can they hire a grant consulting services company to manage the project?
A. Yes, this is an allowable cost. However, please be mindful that the 80% of the total funding received by the organization as a PTE must be sub-awarded; only the remaining 20% can be used for its own costs, including contractual services such as those of a grant consulting company.
Q. Does having a pending grant application with a different agency for the same project affect our outcomes?
A. No, however please note that you cannot use other federal funding as match. Moreover, your costs cannot be counted more than 1 time (e.g. cost for buying a shovel to be used in grant A cannot also be claimed as a cost in grant B).
Q. Are contractual service providers like tree planting or outreach contractors the same as subawardees? Or is a contract for services different from a subaward? ln short, what constitutes a subaward?
A. First, the NOFO requires that 80% of all funding received by the pass-through entity must be sub-awarded to community-based organizations and other partners serving disadvantaged communities. The NOFO defines a “Community Based Organization” as a public or nonprofit organization that supports and/or represents a community and/or certain populations within a community through engagement, education, and other related services provided to individual community residents and community stakeholders.
Second, contracts are distinct from subawards.
A Subaward is an award provided by a pass-through entity (PTE) to a subrecipient for the subrecipient to carry out part of a Federal award received by the pass-through entity. It does not include payments to a contractor or payments to an individual that is a beneficiary of a Federal program.
On the other hand, a contract is for the purpose of obtaining goods and services for the non-Federal entity's own use and creates a procurement relationship with the contractor.
The substance of the relationship is more important than the form of the agreement. Although the following characteristics may not be present in all cases, they are indicative of the nature of the relationship between the non-Federal entity and the third party:
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SUBRECIPIENT
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CONTRACTOR
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- Determines who is eligible to receive what Federal assistance
- Its performance is measured in relation to whether objectives of a Federal program were met
- Has responsibility for programmatic decision-making
- Responsible for adherence to applicable Federal program requirements specified in the Federal award
- In accordance with its agreement, uses the Federal funds to carry out a program for a public purpose specified in authorizing statute, as opposed to providing goods or services for the benefit of the PTE
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* Provides the goods and services within normal business operations
* Provides similar goods or services to many different purchasers
* Normally operates in a competitive environment
* Provides goods or services that are ancillary to the operation of the Federal program
* Not subject to compliance requirements of the Federal program as a result of the agreement, though similar requirements may apply for other reasons
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It must also bear pointing out that once a pass-through entity (PTE) makes a determination that the relationship with the third-party constitutes a subaward, it then has the following responsibilities under 2 CFR 200.332, aside from the PTE responsibilities listed in the NOFO:
(a) Ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. Required information includes:
(1) Federal award identification.
(i) Subrecipient name (which must match the name associated with its UEI);
(ii) Subrecipient's unique entity identifier (obtained through registration with SAM.gov);
(iii) Federal Award Identification Number (FAIN);
(iv) Federal Award Date of award to the recipient by the Federal agency;
(v) Subaward Period of Performance Start and End Date;
(vi) Subaward Budget Period Start and End Date;
(vii) Amount of Federal Funds Obligated by this action by the PTE to the subrecipient;
(viii) Total Amount of Federal Funds Obligated to the subrecipient by the PTE including the current financial obligation;
(ix) Total Amount of the Federal Award committed to the subrecipient by the PTE;
(x) Federal award project description, as required to be responsive to the Federal Funding Accountability and Transparency Act (FFATA);
(xi) Name of Federal awarding agency, PTE, and contact information for awarding official of the PTE;
(xii) Assistance Listings number and Title; the PTE must identify the dollar amount made available under each Federal award and the Assistance Listings Number at time of disbursement;
(xiii) Identification of whether the award is R&D (Research & Development); and
(xiv) Indirect cost rate for the Federal award (including if the de minimis rate is charged).
(2) All requirements imposed by the PTE on the subrecipient so that the Federal award is used in accordance with Federal statutes, regulations and the terms and conditions of the Federal award;
(3) Any additional requirements that the PTE imposes on the subrecipient in order for the PTE to meet its own responsibility to the Federal awarding agency including identification of any required financial and performance reports;
(4) Indirect Cost Rate
(5) A requirement that the subrecipient permit the PTE and auditors to have access to the subrecipient's records and financial statements as necessary for the PTE to meet the requirements of 2 CFR 200; and
(6) Appropriate terms and conditions concerning closeout of the subaward.
(b) Evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) above, which may include consideration of such factors as:
(1) The subrecipient's prior experience with the same or similar subawards;
(2) The results of previous audits including whether or not the subrecipient receives a Single Audit in accordance with Subpart F of 2 CFR 200, and the extent to which the same or similar subaward has been audited as a major program;
(3) Whether the subrecipient has new personnel or new or substantially changed systems; and
(4) The extent and results of Federal awarding agency monitoring (e.g., if the subrecipient also receives Federal awards directly from a Federal awarding agency).
(c) Consider imposing specific subaward conditions upon a subrecipient if appropriate as described in 2 CFR 200.208.
(d) Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. PTE monitoring of the subrecipient must include:
(1) Reviewing financial and performance reports required by the PTE.
(2) Following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the Federal award provided to the subrecipient from the PTE detected through audits, on-site reviews, and written confirmation from the subrecipient, highlighting the status of actions planned or taken to address Single Audit findings related to the particular subaward.
(3) Issuing a management decision for applicable audit findings pertaining only to the Federal award provided to the subrecipient from the PTE as required by 2 CFR 200.521.
(4) The PTE is responsible for resolving audit findings specifically related to the subaward and not responsible for resolving crosscutting findings. If a subrecipient has a current Single Audit report posted in the Federal Audit Clearinghouse and has not otherwise been excluded from receipt of Federal funding (e.g., has been debarred or suspended), the PTE may rely on the subrecipient's cognizant audit agency or cognizant oversight agency to perform audit follow-up and make management decisions related to cross-cutting findings in accordance with section § 200.513(a)(3)(vii). Such reliance does not eliminate the responsibility of the PTE to issue subawards that conform to agency and award-specific requirements, to manage risk through ongoing subaward monitoring, and to monitor the status of the findings that are specifically related to the subaward.
(e) Depending upon the PTE's assessment of risk posed by the subrecipient (as described in paragraph (b) above), the following monitoring tools may be useful for the PTE to ensure proper accountability and compliance with program requirements and achievement of performance goals:
(1) Providing subrecipients with training and technical assistance on program-related matters;
(2) Performing on-site reviews of the subrecipient's program operations;
(3) Arranging for agreed-upon-procedures engagements as described in 2 CFR 200.425.
(f) Verify that every subrecipient is audited as required by Subpart F of 2 CFR Part 200 when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in 2 CFR 200.501 (currently sent at $750,000).
(g) Consider whether the results of the subrecipient's audits, on-site reviews, or other monitoring indicate conditions that necessitate adjustments to the PTE's own records.
(h) Consider taking enforcement action against noncompliant subrecipients as described in 2 CFR 200.339 (Remedies for Non-compliance) and in program regulations.
Q. How should we represent costs incurred by project partners in the budget if we are not planning to do subawards?
A. Costs of project partners (not subrecipients) are third-party contributions.
Q. Does having a pending grant application with a different agency for the same project affect our outcomes?
A. No, however please note that you cannot use other federal funding as match. Moreover, your costs cannot be counted more than 1 time (e.g. cost for buying a shovel to be used in grant A cannot also be claimed as a cost in grant B).
Q. When does the 5 year project period begin?
A. On the date FS signs award; pre-award may be allowed as far as the date of the announcement for the selected recipients.
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