What is the new Statement of Compliance Requirement in Tab 23 of the 523 Grant Application Checklist?

Sincerely, Compliance Woes

Dear Compliance Woes,

Your question is best addressed by an expert so I asked Judy Monteux, RCAC’s very own financial management specialist, to respond. Here’s what she had to say:

On March 27, 2017, USDA published RD AN No. 4828, a new version of the 523 grant application processing checklist. One of the requirements in this new checklist at Tab 23 is a Statement of Compliance with 2 CFR 200 Part 400 & 416 if a State or Local government; or Part 400 & 415 if a nonprofit. However, the reference for this tab is 1944.411(c). If you look that up in the USDA regulations, it states “The grantee furnishes a signed statement that it complies with the requirements of the Departmental Regulations found in 7 CFR Part 3015 and Part 3016.” This refers to the old USDA regulations in place before December 19, 2014.

Confused yet? Let’s look at what was in the 7 CFR 3015 and 3016 (the requirement should have also included Part 3019 but it was never revised).

7 CFR 3015 was entitled “Uniform Federal Assistance Regulations.” It contained the general provisions that applied to all grants and cooperative agreements made by USDA including a set of principles for determining allowable costs under USDA grants and cooperative agreements to State and local governments, universities, nonprofit and for-profit organizations. Its purpose was to simplify, standardize, and improve the administration of USDA grants and cooperative agreements.

Rules for grants and cooperative agreements to State and local governments were found in 7 CFR 3016 Uniform Administrative Requirements For Grants And Cooperative Agreements To State And Local Governments. Rules for grants and cooperative agreements to institutions of higher education, hospitals, and other nonprofit organizations were found in 7 CFR 3019Uniform Administrative Requirements For Grants And Agreements With Institutions Of Higher Education, Hospitals, And Other NonProfit Organizations. These two parts included general provisions, pre-award requirements, post-award requirements (which included standards for financial management, procurement, reports and record retention), and after-the-grant requirements for each type of entity.

So where did these go and where did Parts 400, 415, etc. come from?

On December 26, 2013, the Office of Management and Budget published the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) which streamlined and combined the eight OMB Circulars (including A-110, A-122 & A-133) into one regulation that effected all recipients of Federal funds, regardless of the type of entity. These new regulations were located at Title 2 CFR 200. They then had to be reviewed and implemented by all Federal awarding agencies during the course of the following 12 months.

On Friday, December 19, 2014, the Federal Register published the joint interim final rule in which 28 Federal awarding agencies joined together to formally adopt the Uniform Guidance in their respective chapters of Title 2 of the Code of Federal Regulations (CFR). These include Chapter IV for Department of Agriculture. As part of the implementation of these new regulations, USDA replaced the old 7 CFR 3015, 3016, 3018, 3019,3022 and 3052 with Parts 400, 415, 416, 418 and 422 to Title 2 of the CFR. The grant applications for the 523 Mutual Self Help program must now include a Statement of Compliance with 2 CFR 200 Part 400 & 416 if a State or Local government or Part 400 & 415 if a nonprofit.

So what are these new regulations?

  • Part 400 – Uniform Administrative Requirements, Cost Principles, And Audit Requirements For Federal Awards – In this part, USDA adopts the Uniform Guidance as USDA policies and procedures, giving regulatory effect for the USDA to the Uniform Guidance.
  • Part 415General Program Administrative Regulations – In this part, USDA added several additional requirements to the overall Uniform Guidance, as was the option for each of the Federal grant making agencies. These include the requirement for competition in the awarding of discretionary grants and cooperative agreements (415.1); and the requirements for acknowledgement of USDA support on publications and audiovisuals (415.2).
  • Part 416 – General Program Administrative Regulations For Grants And Cooperative Agreements To State And Local Governments – This part is made up of special procurement provisions for States when expending Federal entitlement programs.
  • Part 418New Restrictions On Lobbying

Please note that not all of the USDA documents associated with the 523 TA grant application have been updated to reflect these new regulations (i.e., Exhibit A (l) – Self Help Grant Agreement) so you may still see some references to 3015 and 3016 but they are no longer in effect.

I hope this clears up the mystery of the new statement of compliance requirement for self-help grantees!

Sincerely, Sher

Dear Sher is a regular Self Help Builder News feature. If you have a question you would like answered or researched by Sher, please send it to asisco@rcac.org and your question may be featured in a future publication.