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Uniform Guidance on Managing Federal Awards

(Christine Hamble)

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OMB Uniform Guidance (UG) – What is it and why?PURPOSE…significantly reforms and strengthens Federal grant-making to improve outcomes for the American people while reducing bureaucratic red-tape

SUPPOSED TO: • Streamline guidance for Federal Awards to ease

administrative burden; AND• Strengthen oversight over Federal funds to reduce

risks of waste, fraud and abuse, AND• Promote performance, compliance and

accountability

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OMB Uniform Guidance (UG) – a quick opinion

Reduce administrative burden Reduce fraud,

waste and abuse

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OMB Uniform Guidance – Uniformity & Simplification

In theory, the UG would create simplification because of uniformity across the various federal agencies in grant-making.

In practice, not so much – agency implementation varies quite a bit.

UG sets out a broad structure within which grant-making agencies must operate, but agencies are allowed to differ in implementation

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OMB Uniform Guidance – TimelineThe Uniform Guidance (except for procurement)

• Became effective 12/26/14 and applies to all new federal awards made on or after that date

• On-going awards that receive additional funding after 12/26/14 may be subject to the new guidance if agency so determines.

• Once UG applies, it applies to both new money and any remaining balance (carryforward) – so no need for new project numbers or segregating old vs new money. This is a very good thing!

• Any on-going award that does not receive additional funding after 12/26/14 will be managed under ‘the old rules’

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OMB Uniform Guidance – What does it mean for OSU

The Good (pre-award)

the Bad or just Not-So-Good

(some post award)

and the (potentially) Ugly (procurement)

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OMB Uniform Guidance –

Major Pre-award Changes

The Good!

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OMB Uniform Guidance – Cost Principles

This has not changed! All expenses charged must be:

•Allowable

In accordance with terms and conditions of award

•Allocable

Necessary to carry out your specific scope of work

•Reasonable

Pass the “Prudent person” test

• Consistently treated in like circumstances

• Adequately documented

• Consistent with institutional policies and procedures

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OMB Uniform Guidance – Administrative Salaries

• UG states administrative salaries are allowable and can be direct charges if:1. Administrative and clerical salaries are integral to a

project or activity, and 2. Individuals involved can be specifically identified with

the project or activity, and3. Such costs are explicitly included in the budget or have

prior written approval of the federal awarding agency, and

4. The costs are not also recovered as indirect costs

What does Integral mean?• Contributes directly to the success of the federal

project• Supports a programmatic objective or activity• Significance of the activity to the scope of work can be

clearly justified

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OMB Uniform Guidance – Computing Devices

A big win! UG says:• Computing devices means machines used to

• acquire, store, analyze, process, and publish data and other information electronically, including accessories (or “peripherals”) for printing, transmitting and receiving, or storing electronic information. (200.20)

• Computing devices are allowable as a direct cost if the devices are essential and allocable, but not solely dedicated, to the performance of a federal award

• Computing device must be necessary and reasonable for the performance of the work

• It must be charged to the project in some manner that reasonably relates to its use on the project

• PI/department should retain documentation as to how the purchase met these criteria (as with any supply)

• Treating computers like other supplies (and as a reminder, a supply is an item with an acquisition cost less than $5,000)

It is still not okay to for example buy the latest version of every tablet. Not just for convenience or personal preference.

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OMB Uniform Guidance – Cost Sharing

• UG says: For research proposals, voluntary committed cost sharing is not expected

• Cost sharing cannot be considered during merit review process unless specified in notice of funding opportunity

• Supposed to eliminate vague language where cost sharing is not required but will be considered. Funding announcements must clearly and explicitly state if cost share is required and how much. If required (i.e. application would be ineligible without it) it must say so.

• Eventually will be a win once agencies fully on board and compliant

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OMB Uniform Guidance – Other Changes

UG says:• Participant support costs allowable with sponsor prior

approval• For projects with education/outreach component only• Exempt from F&A; re-budget only w/prior approval• NIH still not using this category

• Our negotiated F&A rates must be accepted by federal agency

• Subawardees with no negotiated F&A rate can use a de minimus rate of 10% MTDC

• Short term visas are now an allowable cost• Time to respond to RFPs: Agencies must post opportunities

at last 60 calendar days prior to due date, but none available for less than 30 calendar days

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OMB Uniform Guidance – Major Post-award Changes

Most of the Not-So-Good and potentially Ugly shows up here

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OMB Uniform Guidance – Project Closeout

• UG says: The non-federal entity (that’s us) must submit no later than 90 calendar days after the end date all financial, performance and other reports required by the terms and conditions of the federal award

• AND: the non-Federal entity must liquidate all obligations incurred under the Federal award not later than 90 calendar days after the end date of the period of performance as specified in the terms and conditions of the Federal award.

• What this means is the money disappears after 90 days – a big change for some agencies!

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OMB Uniform Guidance – Project Closeout• Before UG, Agencies had different practices e.g., NSF and USDA

already didn’t allow drawdowns after 90 days, but US Dept. of Education would give extensions sometimes if you asked. And, very big change: NIH allowed up to 15 months for corrections/drawdowns.

• That flexibility is being removed – new pressure on agencies to close out quickly• Enforcement now at 90 days for final cash draw. This mean the

account (letter of credit) closes down at 90 days and will not be re-opened. There is NO appeals process.

• We cannot draw funds until we submit a fiscal report; the draw has to match the fiscal report exactly. If it does NOT match, the final draw-down is denied and we cannot recover the addtl funds since the last draw-down.• As a result, OSP is increasing the frequency of drawdowns

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OMB Uniform Guidance – Project Closeout• PIs, department and OSP staff must work

together to ensure that all project costs are recorded in time to be billed during the 90 day close-out period.

• OSP cannot wait until 90th day to do all the final reports/drawdowns and generally cannot revise/redo at the 11th hour to accommodate late charges – creates risk of losing even more money.

• More late DRDs and other charges will be denied.

• Account should be final and ready to close at 45 days after the end date

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OMB Uniform Guidance – Effort Reporting

UG says that personnel charges must:• Be based on records that accurately reflect the work performed• Be supported by a system of internal controls that provides

reasonable assurance that the charges are accurate, allowable and properly allocated

• Reasonably reflect the total activity not exceeding 100% of Institutional Base Salary

• and system must provide for after-the-fact confirmation or review

• No specific procedure, i.e. “effort certification” of time records is now required, but any significant changes in OSU’s effort certification system will require auditor input over time because no-one knows what auditors will consider sufficient & personnel charges are the biggest expense category

• Effort certification as we know it will likely go away eventually

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OMB Uniform Guidance – Procurement

• New Micro Purchase Threshold: The most significant change, which could be quite burdensome for effective project conduct, is the requirement that any purchase over $3,000 must have at least 2 price quotes (the current threshold for that is the $25,000 small purchase threshold)• Would mean thousands of transactions requiring

special handling versus right now about 250

• The procurement changes have been put on hold until 7/1/17

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OMB Uniform Guidance – How do you know if it applies to your award?

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OMB Uniform Guidance – What does it mean for OSU?

• Evolutionary, not revolutionary

• Some good news and new flexibility, but also some new administrative burdens

• Still not fully implemented (procurement)

• Implementation still confusing because of agencies• Each Federal agency will implement a slightly different

version of the UG• Some agencies still struggling to implement

• Need comfort with uncertainty, because still plenty to go around

• Our first audit under the UG will be for FY 16

• That means that the UG is still being interpreted and clarified