By Samantha Bowley, RCAC finance management specialist, Mutual Self-Help Housing

On August 13 the Office of Management and Budget revised sections of the OMB Guidance for Grants and Agreements. There are two sections that went into effect immediately on that date:

  • 200.340 (New Section) Termination The new language strengthens the ability of the Federal awarding agency to terminate federal awards, in whole, or in part; ”…Federal awarding agencies must clearly and unambiguously articulate the conditions under which a Federal award may be terminated in their applicable regulations and in the terms and conditions of Federal awards. The intent of this change is to ensure that Federal awarding agencies prioritize ongoing support to Federal awards that meet program goals.”
  • 200.216 which relates to a prohibition on certain telecommunication and video surveillance services, which has little to no bearing for our Self-Help grantees (primarily for the attention of defense contracts)

There are numerous updates that will become effective November 12. A few highlights are:

  • 200.313 Equipment (e) Disposition. (1) Items of equipment with a current per unit fair market value of $5,000 or less may be retained, sold or otherwise disposed of with no further responsibility to the Federal awarding agency.
    • Language was changed from “no further obligation” to “no further responsibility” to clarify that nothing was owed to the awarding agency.
  • 200.329 (New Section) Monitoring & Reporting Program Performance“…the Federal awarding agency must require the recipient to relate financial data and accomplishments to performance goals and objectives of the Federal award…” and “…recipients must provide cost information to demonstrate cost effective practices (e.g., through unit cost data)…
    • The new language specifies the fiscal tie to outcomes. To implement, RCAC will examine content requirement of SF270 draws to likely include:
      • SF270 form
      • EU report (SHARE’s download)
      • Grant funds drawn to date (templates to be provided)
      • Budget to Actual expense report (templates to be provided)
      • 200.343 Closeout. (a) “The recipient must submit, no later than 120 calendar days after the end date of the period of performance, all financial, performance, and other reports as required by the terms and conditions of the Federal award…”
        • Increased from 90 days to 120 days.

Likely the most impactful change for Self-Help USDA Rural Development grants is in the area of de minimis indirect use:

  • 2 CFR 200.4149 (f) “expands use of the de minimis rate of 10 percent of modified total direct costs (MTDC) to all non-Federal entities (except for those described in Appendix VII to Part 200—State and Local Government and Indian Tribe Indirect Cost Proposals, paragraph D.1.b). Currently, the de minimis rate can only be used for non-Federal entities that have never received a negotiated indirect cost rate…”
    • Another revision adds language to 2 CFR 200.414 (f) “to clarify that when a non-Federal entity is using the de minimis rate for its Federal grants, it is not required to provide proof of costs that are covered under that rate …”

Again, these are just a few update highlights, and these changes do not go into effect until November 12. I will work on a training for our grantees to review the updates prior to the implementation date. Stay tuned for more details. One final note, there is a re-numbering/restructuring of the register’s entire section, so remember to review your agency’s policies and procedures for edits and corrections necessary if numbered sections of the guidance are referenced.