COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM
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AGREEMENT FUNDED UNDER
THE CLEARWATER COMMUNITY DEVELOPMENT
BLOCK GRANT PROGRAM
THIS AGREEMENT is entered into as of the 1st day of October, 1987, by
the CITY OF CLEARWATER, Florida, a political subdivision of the State of
Florida, hereinafter referred to as the "CITY", and COMMUNITY PRIDE CHILD
CARE CENTER OF CLEARWATER, INC., hereinafter referred to as the "PSA", a
non-profit agency organized and existing under the laws of the State of
Florida, having its principa~ office at 1235 Holt Avenue, Clearwater,
Florida, and includes the Appendices attached hereto.
WHEREAS, the City has agreed with the United States Department of
Housing and Urban Development to conduct a Community Development Program,
hereinafter referred to as the "Program", with federal financial assistance
under Title I of the Housing and Community Deo/elopment Act of 1974, as
amended, hereinafter called the "Act", and
WHEREAS, the Planning & Urban Development Department, hereinafter
called the "Department", will act in behalf of the City in conducting the
Program, and
WHEREAS, the PSA operates a child care program of direct benefit to
low and moderate income residents within the City of Clearwater and pro-
poses to perform the work and carry out the programs described in Appendix
A; hereinafter referred to as the "Project", and desires federal financial
assistance through the City to effect t~is proposal, and
WHEREAS, the City finds the project to be meritorious and in fulfill-
ment of the purposes of the Act;
THEREFORE, the parties agree as follows:
1. The PSA shall, in a satisfactory and proper manner as determined
by the Department, conduct the Project outlined in Appendix A.
2. The term of this agreement shall commence on October 1, 1987, and
terminate on September 30, 1988, unless earlier cancelled as provided here-
in. The agreement may be extended for up to one additional year upon the
request of the PSA and the written authorization of the City Community
Development Coordinator.
The need and merit shall be at the determination
of the Coordinator.
The Department may issue written or oral instructions
to clarify any other details or provisions of this Agreement.
Such
instruction must be within the intent of the project and not be of such
PSA 10/1/87
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nature to affect cost or period of performance.
3. The City representative with the PSA as regards conduct of
services under this contract shall be the Community Development Coordinator
and the PSA's services shall b~ carried out under the supervision of its
Executive Director.
4. The PSA shall use the funds to support the Project serving
residents of Neighborhood Target Areas and particularly within the PSA's
area of operation. The PSA shall not exceed its budgeted amount and shall
use the funds in accordance with the budget to be paid with Community
Development Funds included in Appendix B.
Funds shall hot be obligated
when payment has been suspended or terminated pursuant to Paragraph 17
hereof.
Any funds which the Department determines were not properly
expended shall be refunded to the City.
5. The PSA shall comply with the provisions of OMB Circular A-IIO,
provided in Appendix G, and with the provisions of OMB Circular 122,
provided in Appendix H.
The PSA shall permit the City to audit the PSA's
financial operation including but not limited to compliance with applicable
provisions of Federal law and regulations.
All PSA financial records
relating to the Project are subject to review by the City.
6. All subcontractors under this agreement shall be approved by the
City.
7. All purchases of consumables, capital equipment and services shall
be in conformity with the Procurement Standards set forth in OMB Circular
A-1IO, Attachment O.
Accountability for project property and equipment
shall be in accordance with the requirements therein set forth.
8. The City agrees to make payment of budgeted costs on a reimburse-
ment basis.
Requests for payment shal+ be as specified in Attachment B.
No advance payments shall be made to the PSA.
All costs and invoices for
requests for payment shall be supported by properly executed payrolls, time
records,
invoices, contracts, or vouchers, or other official documentation
evidencing in proper detail the nature and propriety of the charges. All
checks, payrolls, invoices, contracts, vouchers, orders or other accounting
documents pertaining in whole or in part to the agreement shall be clearly
identified and readily accessible.
Final requests for reimbursement here-
under shall be submitted within 30 days after completion of all services to
be performed by the PSA and the City shall not be responsible for payment
of any' charges, claims or demands hereunder not received within said thirty
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day period.
9. The City shall retain custody upon termination of this agreement
of any and all property purchased with Community Development Funds.
"Property" as used in this Paragraph shall mean ndnexpendable tangible
property valued at $200 or more with a life expectancy of one year or more.
The PSA shall retain custody of property acquired with federal funds so
long as the property is used for the purposes described in Appendix A.
When no longer used for such purpose, the City shall assume custody of the
property upon written notice to the PSA.
Upon purchase and receipt of
property, the PSA shall submit to the Department a Property Receiving Re-
port.
Stolen, lost or returned property shall be reported immediately to
the Department.
Thirty days prior to the end of the grant year or
immediately upon termination of this agreement, the PSA shall submit in a
Property Report a physical inventory of all property purchased with
Community Development Funds.
The report shall also contain a verification
of the existence and current use and location of the property, and, if
applicable, the continued need for the property.
No real or personal
property or custody thereof purchased with such funds shall be disposed of,
transferred, assigned, or loaned by the.PSA without prior written consent
of. the City.
10. Nothing in this agreement shall be construed to permit invasion of
the privacy of individuals who are served by the project, nor shall this
agreement be construed to require the PSA to publish or release information
to third parties which would invade the privacy of such individuals.
Information obtained by the Department as required by this agreement shall
not be used or disclosed in such a way as to invade individual privacy and
client relationships, unless Florida law pertaining to public records re-
quires disclosure of said information.
11. The PSA shall obtain prior written approval by addendum to this
agreement for any of the following changes:
a. Substantial changes in the project work plan
b. Changes in any budget line item.
12. The PSA agrees to fully pa~ticipate in the implementation and
maintenance of an evaluation system to continually monitor the project.
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This shall include, but not be limited to, periodic submission of data re-
ports which will be used by the Department for inclusion in the Annual
Grantee Performance Report, periodic monitoring visits by the Department
for conformance with this agreement,
and continuing assessments of
performance
hereunder.
PSA agrees to comply with evaluation
and
information requirements of the Department.
A final report shall be sub-
mitted by the PSA within 30 days after the end of the contract term.
final report shall consolidate reporting of all project participants.
13. PSA shall establish and maintain on an accrual basis an accounting
This
system in accordance with the Standards of Grantee Financial Management
Systems as set forth in OMB Circular A-IIO and in accordance with generally
accepted accounting principals and standards.
PSA agrees to modify or
correct said systems in accordance with the City's requirements.
14. PSA shall maintain such records and accounts as are deemed
necessary by the City to assure a proper accounting for all project funds.
All such records shall be available for audit, inspection or copying
purposes at any time during normal business hours and as often as the City,
HUD, and/or representatives of the Comptroller General of the United
States, or other federal agency, may deem necessary. Such records shall be
retained for such period as required by applicable laws and regulations and
may thereafter be destroyed only with the prior written approval of the
City.
Such records shall include financial records, audits,
supporting
documents, statistical reports and client files. PSA will comply with such
additional requirements as to maintenance of records as the City may re-
quest in writing.
In the event the PSA cannot continue to be responsible
for maintenance of the records, then the City shall be so notified in order
to take custody of the records.
The City may, at any time, on written
notice to the PSA take custody of any and all records established under
this Agreement.
15.
The PSA shall hold and save the City,
its officers, agents, and
employees harmless from liability of any nature or kind,
including costs
and expenses, for or on account of any suits or damages of any character
whatsoever resulting from injuries or damages sustained by any persons or
property resulting in whole or in part from the negligent performance or
omission of any employee, agent or representative of the PSA.
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16. The PSA shall not assign any interest in this Agreement without
the prior written consent of the City.
17. The City may suspend, withhold, or terminate payment of the
project, in whole or in part, for cause.
Cause shall include the
following:
a. Ineffective or improper use of project funds
b. Failure to comply with any term or condition hereunder
c. Refusal to accept conditions imposed by HUD
d. Submittal of reports which are incorrect or incomplete
in any material respect
e. If carrying out this Agreement is rendered impossible or
infeasible for any reason including changes in law or the
unavailability of HUD funds necessary for continuation.
If the City suspends payment, it shall advise the PSA and specify in
writing the actions that must be taken as a condition precedent to the
resumption of payment and specify a reasonable date for compliance.
18. Both parties will use their best efforts to ensure that services
under this Agreement are provided so as to best meet the needs of residents
with priority to those residents who reside in the Community Development
target areas.
The PSA shall make every effort to assure that a minimum of
two-thirds of those persons receiving services hereunder are low and
moderate income.
19. No person with responsibilities in the operation of the project
will discriminate with respect to any project participant because of race,
color, national origin, or sex. Nor shall any participant be excluded from
participation in, be denied of, or be subjected to discrimination under any
program of activity funded in whole or in part with Community Development
Funds because of race, color, national origin or sex, as set forth in Other
Program Requirements in Appendix D, (CFR 570.601).
20. The PSA will establish safeguards to prohibit employees from using
their positions for a purpose that is or gives the appearance of being mo-
tivated by a desire for private gain for themselves or others, particularly
those with whom they have family, business or other identifiable ties.
Prior to requesting any continued project funding beyond the term covered
by this Agreement or for new public services not covered by this Agreement,
the PSA shall attempt to secure other local, state or federal funding
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and/or private funding for such project.
The PSA will not as a result of
receiving funding for the Project reduce its support for other similar
services already being provided by the PSA in the area of its operation,
and will, in fact, affirmatively seek additional assistance and support
from other sources for increasing services where needs demand such
increase.
The PSA will not use these funds for publicity or propaganda
purposes designed to support or defeat legislation pending before federal,
state or local governments.
21. The PSA shall comply with the requirements of Section 3 of the
Housing and Urban Development Act of 1968, as amended, and the HUD regula-
tions issued pursuant thereto, attached hereto as Appendix E.
22. The PSA will comply with Equal Employment Opportunities Executive
Order 11246, as amended, attached hereto as Appendix F.
23. The PSA will comply with applicable federal law and regulations,
including but not limited to:
National Environmental Policy Act of 1969;
Flood Disaster Protection Act of 1973;
HUD Lead-Based Paint Poisoning Prevention Act;
Clean Air Act;
Historic Preservation Requirements of P.L. 89-656;
Archeological and Historic Preservation Act of 1974;
Executive Order 11593;
Architectural Barriers Act of 1968;
Hatch Act;
Federal Water Pollution Control Act;
Federal Labor Standards provisions and the Davis-Bacon Act;
The Civil Rights Act of 1964;
National Flood Insurance Program;
all as amended from time to time and in effect during the term of this
Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this agreement to
be executed as of the day and year first above written.
COMMUNITY PRIDE CHILD CARE CENTER, INC.
By~/r.~
President
CITY OF CLEARWATER, FLORIDA
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ATTEST:
City At
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Approved as to form & correctness:
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C I T Y '0 F C LEA R W ATE R
Interdepartment Correspondence Sheet
TO:
Cyndie Goudeau - City Clerk
FROM:
J. D. Sheeler - Community Development Coordinat
COPIES:
SUBJECT:
CDBG Agreement - Community Pride Child Care Center of Clearwater, Inc.
DATE:
November 23, 1987
Please find enclosed the original CDBG Agreement with Community Pride Child
Care Center for your files. We have retained a copy for our files.
JRM:nt
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COMMUNITY PRIDE CHILD CARE CENTER, INC
APPENDIX A
PROJECT NARRATIVE
for Community Development Block Support 1987-1988
COMMUNITY 'PRIDE TITLE XX MATCH
Community Pride will continue to provide children's day care services
for families receiving support under Title XX of the Social Security
Act. Community Development support will provide "12.5%" matching
funds for up to an average of 24 children for appriximately 262 days.
CO~~UNITY PRIDE NORTH REHABILITATION
The Community Pride Child Care Center at 1235 Holt Avenue, Clearwater,
will continue to be upgraded through the following:
1. Replace two gas heaters.
2. Paint exterior of the building.
3. Replace the roof.
4. Such other related improvements as may be accompli&hed within
the budgeted funds.
See following non-scaled sketch.
Community Development funds will.assist in providing any or all of
the above items up to the dollar level indicated in Attachement B.
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COMMUNITY PRIDE CHILD CARE
APPENDIX B
PROJECT BUDGET
for Community Development Block Grant Support 1987-1988
1. Community Pride Title XX Match
Title XX Match, average 24 children,
approximately 262 days
TOTAL
$3,500
$3,500
II. Community Pride North Rehabilitation
Paint exterior of building, replace
roof and heaters, other TOTAL
$13,500
$13,500
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APPENDIX C
COMMUNITY PRIDE CHILD CARE
}~THOD Of PA~~T
All pa)~ents shall be on a reimburse~ent basis ,only.
All re~uests for rei~burse~en~ shall be supported by proper i~voices.
payrolls, checks, receipts and other ooc~entation as requested.
Any program income shall be suomitteo to the CITY throusn the
DEPAR~~;~ at least quarterlY. Tees coll~cted, if any, shall oe re?orted
but are not to be construeo as pro~rac income.
~equests for r2i~burse~ent shall not be reduced by any oro~r2o inco~e
received.
C - 1
Subp8r1 K-0ther Program
Requirements
~ 570.~OO General
(u) Section 104(b) ,J the Act provides
thutany grant under ~ection 106 of the
Act shalj be lJ.e . nly if the grontee
certifies to the slltisfaclion of the
Secreta'f)', among other things, thotthe
gTlml "will t}e,conducted and
administered in conformity with Pub. L
88-352 and Pub. L. 90-284," and, further,
that the granlee "will comply with the
other provisiOnB of Ihis title and with
olher applicable laws:: Seclion 104(d)(1)
of the Acl requires thaI the Secrelary
dtdermine wi Ih respecllo grants made
pursullnlto section 100(b) (Entitlemenl
Granls) and 106(d)(2)(B) (HUD-
Administered Smoll Cities Grants), at
leasl on an annual basis. among other
things, "whether the gran lee has carried
out (its) certifications in compliance
with the requirements and the primary
objeclives of this title and with olher
applicable la wa . . . ." Certain other
slatutes are expressly made applicable
to aclivities assisted under the Act by
Ihe Act ilself. while other laws not
referred 10 in the Act may be applicable
10 such activities by their own lerms.
Certain slatutes or Executive Orders
which may ue applicable to activities
assisted under the Act by their own
terms are administered or enforced by
governmental departmenLB or agencies
other than the Secretary or the
DepartmenL This Subpart K enumerates
laws which the Secrelary will treat as
applicable to grants made under section
106 of the Act, other than grants to
APPENDIX D
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OTHER PROG~~ REQUIRE~lliNTS
States made pursuant to section 106(d)
of the Act. for purposes of the
determinotions described above 10 be
made hy the Secrelary under section
104(d)(1) of the Act. including slatules
expressly mode applicoble by the Act
and certain other slalules and Executive
Orders for which the Secretary has
enforcement responsibilily. The absence
of mention herein of any other statute'
for which Ihe Secretory does not ha ve
direct enforcement responsibility is not
intended to be loken as an indica lion
Ihot, in Ihe Secretory's opinion, such
slalute or Executive Order Is not
applicoble to activilies assisted under
the Act. For lows which the Secrelory
will treal as applicable to gran Is made
10 Slalesunder section 100(d) of the Act
for purposes of the determination
required to be mode by the Secretary
pursuont to section 104(d)(2) of the Act,
see' 570.4.96.
(b) This Subpart also sels forth certain
additional program requirements which
the Secretary has delermined to be
applicable to gran Is provided under the
Act as a matter of adminiatralive
discretion.
(c) In addition to grants made
pursuant to section 100(b) and
106(d)(2)(B) of the Act (Subparls D and F
of this Parl, respecti.re1y), the
requirements of this Subpart K are
applicable to grants made pursuant to
sections 107 and 119 of the Act
[Subparts E and G, respectively).
~ 570.601 Pub. L 88-352 and Pub. L 9<l-
284; Executive Order 11063.
Section 104(b) of the Act provides that
any grant under section 100 of the Acl
shall be made only if the grantee
ce'rtifies 10 the satisfaction of the
Secretary that the grant "will be
conducted and adminislered in
conformily with Pub. L 88-352 and Pub.
L. g{}.-284." Similarly. section 107
provides that no grant may be made
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under that .ection (Secretary'.
Discretionary Fund) or seclion 119
(UDAG) without .stisfactory 88surances
to' the same effect.
(a) "Pub. L a&-352" refeTl \0 Tille VI
of Ihe Civil Righls Acl of 1004 (42 U.S.C.
2(XXl<I et leq.), which provides thaI no
person In the United Stllles .hllll on the
ground of race, color. or national origin,
be excluded from porticipo tion In. be
denied the benefits of. or be subjected to
discrimination under any progrom or
acllvlly receivlng Federal finonclal
o3sistllnce. Section 602 of the Civll
Rights AcI of 1004 dirocls each Federal
depllrtment Bnd agency empowered to
exlend Federal financial assistance to
any program or aclivity by way of granl
10 effectuale the foregoing prohibilion
by issuing rules, regulations, or orders of
general appllcllbility which shall be
consistent with achievemenl of the
, stlltulc llulhoriz:ing the financial
Iissislance. BUU regulations
implementing the requirements of Tille
VI with reapcctto BUD progroms are
contained in 24 CfR ParI 1.
(b) "Pub. L 90-2.84" refere to Title VIll
of the, Civil Righls Act of 1968 (42 U.S.C,
3001 et 6eq.), popularly known 8S Ihe
Fair Housing Act. which provides that il
is the policy of the United Sla tes 10
provide. within constitutional
limita lions. for fair housing throughout
the United Stales and prohibita any
person from diecriminating in the sale or
rental of housing. the financing of
housing. or the provision of brokerage
services. lncluding in any way making
unavailable or denying a dwelling 10
any,person. because of race, color.
religion, sex. or national origin. Title
VlJl further requires the Secretary to
administer the programs and activities
relating 10 ho~sing and urban
development In a manner affinnatively
to further the purposee of Title VIII.
Pursuant 10 this stalutory direction. the
Secretary requires tha t grantees
administer 011 programs and aClivities
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related to housing nnd community
devclopml!nt in 0 manner to
offirmntively further fuir housing.
(c) Executive Order 11003. as
amended by Executive Order 12259.
directs the Oepartmenllo take all action
necessury and appropriate to prevent
discriminution because of race, color.
religion (creed), sex, or national origin.
in the sole, leasing. rental, orother
disposition of residentiul properly and
rdated facilities (including land to be
developed for residential use). or in the
use or occupancy lhereof. if such
properly ond related facilities ore.
umong other things, provided in whole
o~ in part with the uid of loans.
tldvonces. grants. or contributions
agrce\i.to be made by the Federal
Covernmenl. IIUO regulations
implementing Executive Order 11003 are
contained in 24 CFR Port 107.
~ 570.602 Sllcllon 109 01 the Act
(0) Section 1~ Mlhe Act requires thai
no person in the United Stales sholl on
the ground of race. color. na lional origin
or sex. be excluded from participation
in. be denied the benefits of. or be
subjected to discrimination under. any
program or aclivity funded in whole or
in port with community development
funds made ovoilable pursuanlto lhe
Act. For purposes of this seclion
"program or aclivil~'" is defined as any
function conducted by an identifiable
administrative unit of the recipient, or
by any unit of government, subrecipienl,
or private contractor receiVing
communil.)' development funds or loons
from the recipienl. "Funded in whole or
in part with community develcpmenl
funds" means lhat community
development funds in any amQunt in the
form of grants or proceeds from HUD -
guaranteed loans have bee!;\,transferred
by the recipient or a subrecipientto an
identifiable administrative unit and
disbursed in a program or activity.
(b) Specific discriminatory actions
prohibited and corrective Dc/ions.
(1) A recipient may not, under any
program or aelivily to which the
regulations of this Pari may apply
directly or through contractual or other
urrangcments, on the ground of race,
color. na lional origin, or sex:
(i) Dcny all)' facilities, 8erviccs.
financial aid or other bcncfit8 provided
under the program or activity.
(ii) Provide uny facilities, 8ervlces,
financialuid or other benefits which are
different, or ore providcd in a different
form from lhut provided to others under
lhe program or udivity.
(iii) Suujectto segregated or sepurale
treatment in any fucility in, or in any
moiler of process relat,;d to receipt of
any service or benefit under the program
or uctivity.
(iv) Restrict in any way Ilccess to, or
in the enjoyment of ony advantage or
privilege enjoyed by others in
connection with facilities. services.
financial aid or other benefits under the
program or activity.
(v) Trellt an individual differently
from others in determining whether the
individual salisfies any admission,
enrollment. eligibility, membership, or
other requirement or condition which
the individual must meet in order to be
provided Bny facililies. services or other
benefit provided under the program or
activi:v.
(vi) Deny an opportunity to participate
in a program or activity as on employee.
(2) A recipient may not utilize crileria
or methods of administration which
have the effect of subjecting individuals
to discrimina lion on the basis of race,
color. national origin, or sex, or have the
effect of defeating or substantially
impairing accomplishment of the
oujectives of the program or aelivity
with respect to individuals of a
particular race. color. national origin. or
eex.
(3) A recipient, in determining the site
or location of housing or facilities
provided in whole or in part with funds
under this part, may not make selections
of such site or location which have the
effect of excluding individuals from,
denying them the benefits of. or
subjecting them to discrimination on the
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ground of race, color. national origin. (lr
sex; or which hllve the purpo~e or effed
of defcatinl( or substantially impairing
the acr.umplishment of the objectives of
the Act and of this section.
(4Jli) In administering a progrllm or
activity funded in whole or in part wilh
COlle funds rcgllrding which the
recipienl has previously discriminuted
against persons on the ground of race,
color. nutional origin or sex, the
recipient musttuke affirmlltive aelion to
overcome the effects of prior
discrimina tion.
(ii) Even in the absence of such prior
discrimination. 8 recipient in
administering a program or activity
funded in whole or in part with CODe
funds should tuke Ilffirmlllive action \0
overcome the effects of conditions
which would otherwise resull in limiting
participlltion by persons of a particular
rllce, color. national origin or sex.
Where previous discriminatory praclice
or uSllge lends, on the ground of race,
color. national origin or sex, to exclude
individuals from participation in, to
deny them the benefits of. or to subject
them to discriminalion under any
program or activity to which this pari
applies. the recipient has an obligation
to take reasonable action to remove or
overcome the consequences of the prior
discriminatory pructice or usage, and 10
accomplish the purpose of the Ac\.
(iii) A recipient shall not be prohibited
by this part from taking any action
eligible under Subpart C to ameliorate
on imbalance in services or facilities
provided to any geographic area or
specific group of persons within its
jurisdiction, where the purpose of such
oction in to overcome prior
discriminatory practice or usage.
(5) Notwithstanding anything to the
contrary in this section, nothing
contained herein shall be construed to
prohibit any recipient from maintaining
or constructing separate living facilitie~
or rest room facilities for the differenl
sexes. Furthermore, seleelivity on the
basis of sex is not prohibited when
institutional or custodial services can
.
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APPENDIX E
SECTION 3 CLAUSE
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TilE FDLLO\HNG SECTION 3 CLAUSE SHALL gE INQ...UDED IN ALL CONTRACTS FOR WORK IN
CONNECTION WITIl A SECTION 3 PROJECT:
A. The work to be performed under this contract is on a project assisted
under a program providing direct Federal financial assistance from
the Department of Housing and Urban Development and is subject to the
requirements of Section 3 of the Housing and Urban Development Act of 1968,
as amended, 12 U.S.C. l70u. Section 3 requires that to the greatest extent
feasible opportunities for training and employment be given lower income
residents of the project area and contracts for work in connection with the
project be awarded to business concerns which are located in, or owned in
substantial part by persons residing in the area of the project.
B. The parties to this contract will comply with the provisions of said Section 3
and the regulations issued pursuant thereto by the Secretary of Housing and
Urban Development set forth in 24 CFR, and all applicable rules and orders of
the Department issued thereunder prior to the execution ot' this cont ract. The
parties to this contract certify and agree that they are under nO contractura1
oc other disability which would prevent th~m from complying with these
requirements.
C. The contractor will send to each labor organization or representative of
workers.with which he has a collective bargaining agreement or other contract
of understanding, if any, a notice advising the said labor organization of
workers' representative of his commitments under this Section 3 Clause and
shall post copies of the notice in conspicuous places available to employees
and applicants for employment or training.
D. The contractor will include this Section 3 Clause in every subcontract for
work in connection with the project and will, at the direction of the
applicant for or recipient of Federal financial assistance, take appropriate
action pursuant to the subcontract upon a finding that the subcontractor is
in violation of regulations issued by the Secretary of Housing and Urban
Development, 24 CFR. The contractor wi11.not subcontract with any subcontractor
where it has notice or knowledge that the latter has been formd in violation 'of
regulations under 24 CFR, and will not let any subcontract unless the
subcontractor has first provided it with a preliminary statement of ability to
comply with the requirements of these regulations.
E. Compliance with the provisions of Section 3, the regulations set forth in 24 CFR,
and all applicahle rules and orders of the Department issued thereunder prior to
the execution of the contract, shall be a condition of the Federal financial
assistance provided to the project, binding upon the applicant or recipient for
such assistance, its successors, and assigns. Failure to fulfill these
requirements shall subject the applicant or recipient, its contractors and sub-
contractors, its successors, and assigns to those sanctions specified by the
grant or loan agreement or contract through which Federal assistance is provided,
and to such sanctions as are specified by 24 CFR 135.
E-l
APPENDIX F
NOTICE Jr REQUIREMENT FOR AFFIRMATIVE AclION
TO ENSURE EQUAL D1PLOYMENT OPPORTUNI TY
(EXECUTIVE ORDER 11246)
1. The Offeror's or Bidder's attention is called to the "Equal Opportunity
Clause" and the "Standard Federal Eq\Ul.l Employment Opportunity ConstruC-
tion Contract Specifications" set forth herein.
2. The goals and timetables for minority and female participation, expressed
in percentage terms for the Contractor's aggregate workforce in each
trade on all construction work in the covered area, are as follows:
A. Goals for Female Utilization, All Trades:
AREA COVERED
Goals for Women apply nationwide.
GOALS AND 'TIMETABLES
Tilnetable
Goals
(percent)
F~om Apr. 1, 1978 until Mar. 31, 1979.... 3.1
From Apr. 1, 1979 until Mar. 31, 1980.... 5,1
From Apr. 1, 1980 until Har. 31, 1981. . . . 6.9
B. Goals for Minoritv Utiliza~ion:
TAMPA- ST. PETERSBURG, FIA., AREA
Area covered: P~llsborough, Pasco, and Pi~ellas
Counties, Fla.
Goals and Timetablesl
Trade
Goal
(percen t)
All. . . . . . . . . . . . . . . . . . . . . .. . . .
17.9
IFor the life of the project.
These goals are applicable to all the Contractor's construction work
(whether or not it is Federal or federally assisted) performed in the
covered area.
The Contractor's compliance with the Execu~ve Order and the regulations
in 41 CPR Part 60-4 shall be based on its implementation of the Equal
Opportunity Clause, specific affirmative action obligations reauired by
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: the specificationl set forth in 41 CFR 60-4.3 (a) , Lnd i t5 efforts to meet
the goals established for the geographical area where the contract
resulting from this solicitation is to be performed. The hou=s of minority
and female employment and training must be substantially uniform throughout
the length of the contract, and in each trade, and the contractor shall
make a good faith effort to employ minorities and women evenly on each of
its projects. The transfer of minority or female employees or trainees
from Contractor to Contractor or from project to project for the sole
purpose ~f meeting the Contractor's goals shall be a violation of the
contract, the Executive Order and the regulations in 41 CFR Part 60-4.
Compliance with the goals will be measured against the total work hours
performed.
3. The Contractor shall provide written notification to the Director 0: the
Office of Federal Contract Compliance programs within 10 working days of
award of any construction subcontract in exceSS of $10,000 at any tier
for constrUction work under the contract resulting from this solicitation.
The notification shall list the name, address and telephone number of the
subcontractor; employer identification number; estimated dollar amount of
the subcontract; estimated starting and completion dates of the subcontract 1
and the geographical area in which the contract is to be perfo~ed.
4. As used in this Notice, and in the contract resulting f~om this solicitation"
the "covered area" is pine lIas County, Florida.
60-4.3 (a)
EQUAL OPPORTUNITY CLAUSE
During the performance of this contract, the contractor agrees as follows:
1. The contractor will not discriminate against any employee or applicant
for employr.tent because of race, color, religion, sex, or national origin.
The contractor will take affir.mat~ve action to ensure that applicants are
employed, and that employees are treated during employment wiL~out ~egard
to their race, color, religion, seX, or national origin. Such action shall
include, but not be limited to the following: Employment, upgrading,
demotion, or transfer; recruitment or recruitment advertising; layoff or
termination, rates of payor other forms of compensation; and selection
for training, including apprenticeship. The contractor agrees to post
in conspicuous places, available to employees and applicantS for employ-
ment, notices to be provided setting forth the provisions of this non-
discrimination clause.
2. The contractor- will, in all solicitations or advertiseoents for employees
placed by or on behalf of the contractor, state that all qualified
applicants will receive consideration for employment without regard to -
race, color, religion, sex, or national origin.
3. The contractor will send to each labor union or representative of workers
with which he has a collective bargaining agreement or other contract or
1.:.I1derstanding, a notice to be provided advising the said labor union or
workers' representatives of the,contractor's commitments under this
section, and shall post copies of the notice in conspicuous places avail-
able to employees and applicants for employment.
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with all provisions of Executive Order 11246
of the rules, regulations, and relevant orders
4.
The contractor will comply
of September 24, 1965, and
of the Secretary of Labor.
5. The contractor will furnish all information and reports required by
Executive Order 11246 of September 24, 1965, and by rules, regulations,
and orders of the Secretary of Labor, or pursuant thereto, and will permit
access to his books, records, and accounts by the administering agency
and the Secretary of Labor for purposes of investigation to ascertain
compliance with such rules, regulations, and orders.
6. In the event of the contractor's non-compliance with the nondiscrimination
clauses of this contract or with any of the said rules, regulations, or
orders, this contract may be canceled, terminated, or suspended in whole
or in part and the contractor may be declared ineligible for further
Government contracts or federally assisted constrUction contracts in
accordance with procedures authorized in Executive Order 11246 of
September 24, 1965, or by rule, regulation, or order of the Secretary
of Labor, or as otherwise provided by law.
7. l~e contractor will include the portion of the sentence immediately
preceding paragraph (1) and the provisions of paragraphs (1) through (7)
in every subcontract or purchase order unless exempted by rules, regula-
tions, or orders of the Secretary of Labor issued pursuant to section
204 of ~xecutive Order 11246 of September 24, 1965, so that such provisions
will be binding upon each subcontractor or vendor. The contractor will
take such action with respect to any subcontract or purchase order as
the administering agency may direct as a means of enforcing such provisions,
including sanctions for non-compliance: Provided, however, That in the
event a contractor ~ecomes involved in, or is threatened with, litigation
with a subcontractor or veneor as a result of such direction by the
administering agency, the contractor may request the United States to enter
into such litigation to protect the interests of the united States.
STANDF.RD FEDERAL EQUAL EHPLOYMENT OPPORTUNITY CONSTRUCTION CONTRACT
SPECIFICATIONS (EXECUTIVE ORDER 11246)
1. As used in these specifications:
a. "Covered are'a" means the geographical area described in the solici ta-
tion from which this contract resulted.
b. "Director" means Director, Office, of Federal Contract Compliance
Programs, united States Department of Labor, or any person to whom
the Director delegates authority.
c. "Employer identification number" means the Federal Social Security
n~ber used on the Employer's Quarterly Federal Tax Return, U. S.
Treasury Department Form 941.,
d. "11inori ty" inc 1 udes :
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(1)
I
Black (all persons having
African racial groups not
I
origins in any of the
of Hispanic origin) ;
Black
.
<
(2) Hispanic (all persons of Mexic~, Puerto Rican, Cuban,
Central or South American or other Spanish Culture or
origin, regarcless of race) I
(3) Asian and Pacific Islander (~ll persons having origins
in any of the original peoples of the Far East, Southeast
Asia, the Indian Subcontinent, or the Pacific Islands); and
(4) American Indian or Alaskan Native (all persons having
origins in any of the original peoples of North America and
maintaining identifiable tribal affiliations through member-
ship and participation or community identification).
2. Whenever the Contractor, or any Subcontractor at any tier, subcontracts
a portion of the work involving any construction trade, it shall
physically include in each subcontract in excess of $10,000 theprovi-
~~ons of these specifications and the Notice which contains the ~p-
pllcable goals for minority and female participation and which is set
forth in the solicitations from which this contract resulted.
3. lfthe Contractor is participating (pursuant to 41 CFR 60-4.5) in a
Hometown.Plan approved by L~e o. S. Department of Labor in the covered
area either individually or through an association, its affirmative action
obligations on all work in the Plan area (including goals and timetables)
shall be in accordance with that Plan for those trades ~hich have unions
participating in the Plan. Contractors must be able to demonstrate their
participation in and compliance wiL~ the provisions of any such Hometown
Plan. Each Contractor or Subcontractor participating in an approved Plan
is individually required to comply with its obligations under -the EEO
clause, and to make a good faith e-ffort to achieve each goal under the
Plan in each trade in which it has employees. The overall good faith
performance by o~~er Contractors or Subcontractors ~oward a goal in an
approved Plan does not excuse any covered Contractor's or Subcontractor's
failure to take good faith efforts to achieve the Plan goals and time-
table.
4. The Contractor shall implement the specific affirmative action standards
provided in paragraphs Ja through p of these specifications. The goals
set forth in the solicitation from which this contract resulted are
expressed as percentages of the total hours of employment and training
of minority and female utilization the Contractor should reasonably be
able to achieve in each construction trade in-vhichit has employees in
the covered area. The Contractor is expected to make substantially
uniform progress toward its goals in each craft during the period
specified.
s. Neither the provisions of any collective bargaining agreement, nor the
failure by a union with whom the Contractor has a collective bargaining
agreement, to refer either minorities or women shall excuse the Contrac-
tor's obligations under these specifications, Executive Order 11246, or
the regulations promulgated pursuant thereto.
F-4
.6. In order for the nonworking t=aining hours of apprentices and trainees
to be counted in mlting the goals, such apprenticesland trainees must
be employed by the Ontractor during the training pe iod, and the
Contractor must have made a commitment to employ the apprentices and
trainees at the completion of their training, subject to the availabil-
ity of employment opportunities. Trainees must be trained pursuant to
training programs approved by theU. S. Department of Labor.
7. The Contractor shall take specific affirmative actions to ensure equal
employment opportuni ty. T1:e evaluation of the Contractor' 9 compliance
with these specifications. shall be based upon its effort to achieve
maximum results from its actions. The Contractor shall document these
efforts fully, and shall implement affirmative action steps at least as
extensive as the following:
a. Ensure and maintain a working environment free of harrassment,
intimidation, and coercion at all sites, and in all facilities at
which the Contractor's employees are assigned to work. The
Contractor, where possible, will assign two or moreq'women to each
construction project. The Contractor shall specifically ensure that
all foremen, superintendents, and other on-site supervisory personnel
are aware of and carry out the Contractor's obligation to maintain
such a working environment, with specific attention to minority or
female individuals working at such sites or in such facilities.
b. Establish and maintain a current list of minority and female
recruitment sources, provide written notification to minority and
female recruitment sources and to community organizations when the
Contractor or its unions have employment opportunities available,
and maintain a record of the organizations' response~.
c. Maintain a current file of the names, addresses and telephone
numbers of each minority and female off-the-street applicant and
minority or female referral from a union, a recruitment source or
community organization and of what 'action was taken with respect
to each such individual. If such individual was sent to t..'1e union
hiring hall for referral and was not referred back to t..~e Contractor
by the union or, if referred, not employed by the Contractor, this
shall be documented in the file with the reason therefor, along with
whatever additional actions the Contractor may have taken.
'\
d. Provide immediate written notification to the Director when the
union or unions with which the Contractor has a collective
bargaining agreement has not referred to the Contractor a minority
person or woman sent by the Contractor, or when the Contractor has
other information that the union referral process has impeded the
Contractor's efforts to meet its obligations.
e. Develop on-the-job training opportunities and/or participate in
training programs for the area which expressly include minorities
and women, including upgrading programs and apprenticeship and
trainee programs relevant to the Contractor's employment needs,
especially those programs funded or approved by the Department of
Labor. The Contractor shall provide notice of these programs to
the sources compiled under 7b above.
f. Disseminate the Contractor's EEO policy by providing notice of the
policy to unions and training programs and requesting t..~eir coopera-
tion in assisting the Contractor in I;leeting its EEO obligations; by
including it in any policy manual and collective bargaining agreement; by
F-S
,
,
I
I
publicizing it in the company newspaper, annual report, etc.; by
specific review of the policy with all management personnel and
with all minority and female employees at least once a year; and
by posting the company EEO policy on bulletin boards accessible
to all employees at each location where construction work is
performed.
g. Review, at least annually, the company's EEO policy and affirmative
action obligations under these specifications with all employees
having any responsibility for hiring, assignment, layoff, termina-
tion or other employment decisions including specific review of
these items wie. onsite supervisory personnel such as Superintendents,
General Foremen, etc., prior ,to the initiation of construction work
at any job site. A written record shall be made and maintained
identifying the time and place of these meetings, persons attending,
subject D~tter discussed, and disposition of the subject matter.
h. Disseminate the Contractor's EEO policy externally by including
it in any ~dvertising in the news media, specifically including
minority and female newS media, and providing written notification
to and discussing the Contractor I s EEO policy with other Con trac-
tqrs and Subcontractors with whom the Contractor does or antici-
pates doing business.
1. Direct its recrui tJDent efforts, both oral and written, to minority,
female and community organizations, to schools with minority and
female students and to minority and female recruitment and training
organizations serving the Contractor's recruitment area and employ-
ment needs~ Not later than one month prior to the cate for the
ac=eptance of applications for apprenticeship or other training
by any recruitment source, the Contractor shall send written
notification to organizations such .as the above describing the
openings, screening procedures, and tests to be used in the selection
process.
j. Encourage present minority and female employees to recruit other
minority persons and women and, where reasonable, provide after
school, summer and vacation employment to minority and female youth
both on the site'and in other areas of a Contractor's workforce.
,'.
k. Validate all tests and other selection requirements where there
is an obligation to do so under. 41 CFR Part 60-3.
1. Conduct, at least annually, an inventory and evaluation at least of
of all minority and female personnel for promotional opportunities
and encourage these employees to seek or to prepare for, L~ough
appropriate training, etc., such opportunities
m. Ensure that seniority practices, job classifications, work assign-
ments and other personnel practices, do not have a discriminatory
effect by continually monitoring all personnel and employment
related activities to ensure that the EEO policy and the Contractor I s
F-6
obligations ~der these specifications are bei'g carried out.
n. Ensure that all facilities and company activities are non-
segrated except that separate or single-user toilet and
necessary changing facilities shall be provided to assure
privacy between the sexes.
o. Document and maintain a record of all solicitations of ofIers
for subcontracts from minority and female construction
contractors and suppliers, including circulation of solicitations
to minority and female contractor associations and other business
associa tions.
p. Conduct a review, at least annually, of all supervisors' adherence
to and performance under the Contractor's EEO policies and
affirmative action obligations.
8, Contractors are encouraged to participate in voluntary associations
which assist in fulfilling one or more of their affirmative action
obligations (7a through p). The efforts of a contractor association,
'joint contractor-union, contractor-community, or other similar group
of \.Jhich the contractor is a member and participant, may be asserted
as fulfilling anyone or more of its obligations under 7a through p
of these 'Specifications provided that the contractor actively partic-
ipates jn the group, makes every effort to assure that the group has
a positive impact on the employment of minorities and \.Jo~en in the
industry, ensures that the concrete benefits of the program are
reflected in the Contractor's minority and female \.Jorkforce partic-
ipation, makes a good faith effort to meet its individual goals and
timetables, and can provide access to documentation \.Jhich demonstrates
the effective~ess of actions taken on behalf of the Contractor. The
obligation to comply, hO\.Jever, is the Contractor's and failure of such
a group to fulfill an obligation shall not be a defense for the
Contractor's noncompliance.
9.A single goal for minorities and a separate single goal for .....omen have
been established. The Contractor, hO\.Jever, is required to provide
equal emp~oyment opportunity and to take a=firmative action for all
minority groups, both male and female, and all women, both minority
and non-minority. Consequently, the Contractor may be in violation
of the Executive Order if a particular group is employed in a substan-
tially disparate manner (for example, even though the Contractor has
achieved its goals for women generally, the Contractor may be in
violation of the Executive Order if a specific minority group of women
is underutilized).
10_ The Contractor shall not use the goals and timetables or affirmative
action standards to discriminate against any person because of race,
color, religion, sex, or national origin.
11. The Contractor shall not enter into any Subcontract with any person
or fir:n debarred from Government contracts pursuant to Executive
Ord~;r; 11246.
F-7
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12.
The Contractor lha11 carry out such sanctions aid penal ties for
violation of these specifications and of the Equal Opportunity Clause,
including suspension, termination and ~ancellation of existing sub-
contracts as may be imposed or ordered pursuant to Executive Order
11246, as amended, and its implementing regulations, by the Office
of Federal Contract Compliance Programs. Any Contractor ....ho fails
to carry out such sanctions and penalties shall be in violation of
these specifications and Executive Order 11246, as amended.
13. The Contractor, in fulfilling i t.s obliga tions under thege specifica tions ,
shall implement specific affirmative action steps, at least a9 exten-
sive as those standards prescribed in paragraph 7 of these specifica-
tions, so as to achieve maximum results from i,ts efforts to ensure
equal employment opportunity. If the Contractor fails to comply ....ith
the requirements of the Executive Order, the implementing regulations,
or these specifications, the Director shall proceed in accordance ....ith
41 ITR 60-4.8.
14. The Contractor shall designate a respons ible official to IrOni tor all
employment related activity to ensure that the company EEO policy is
being carried out, to submit reports relating to the provisions hereof
as may be required by the Government and to keep records. Records
shall at least include for each employee the name, address, telephone
numbers, construction trade, union affiliation if any, employee
identification number ....hen assigned, social security number, race,
sex, status (e.g., mechanic, apprentice, trainee, helper, or laborer),
dates of changes in status, hours ....orked per ....eek in the indicated
trade, rate of pay, and locations at ....hich the ....ork ....as performed.
Records shall be maintained in an easily understandable and retrievable
fonn; ho....ever, to the degree that existing records satisfy this
requirement, contractors shall not be required to maintain separate
records.
15. Nothing herein provided shall be construed as a limitation upon the
application of other la....s ....hich establish di!ferent standards of
compliance or upon the application of requirements for the hiring of
local or other area residents (e.g., those under L~e Public Works
Employment Act of 1977 and the community Development Slock Grant
program) .
F-8
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I
COMMUNITY PRIDE CHILD CARE CENTER OF CLEARWATER, INC.
APPENDIX G
OMB
Circular A-IIO
I
t
Office of Management and Budget Circular A-110 (7/30/76)
OFRCE OF MANAGEMENT AND
BUDGET
[Circular No. A-IIO]
GRANTS AND AGREEMENTS WITH INSTI-
TUTIONS OF HIGHER EDUCATION,
HOSPITALS, AND OTHER NONPROFIT
ORGANIZATIONS
Uniform Administrative Requirements
JULY I, 1976.
To the heads of executive departments
and establishments.
Subject: Uniform administrative re-
qUirements for grants and other agree-
ments with institutions of higher edu-
cation, hospitals, and other nonprotlt
organizations
L Purpose.-This Circular, promul-
gates standards for obtaining consisten-
cy and unJformity a.mong Federal agen-
cies in the administration of grants to,
and other agreements with, public and
private institutions of higher education,
public and private hospitals, and other
quasi-public and private nonprotlt or-
ganiza.tions. This Circular does not apply
to grants, contracts, or other agreements
between the Federal Government and
units of State or local governments
covered by Federal Management Cir-
cular 74-7.
2. Effective date.-The standards in
the attachments to this Circular will 'be
applied as soon as practicable but not
later than January I, 1977.
3. Supersession.-This Circular res-
cinds and replaces parts III and IV of
the Appendix to Federal Management
Circular 13-7, Administration of college
and university research grants.
4. Policy intent.-The uniform stand-
ards and requirements included in' the
attachments to this Circular replace the
varying and often conflicting require-
ments that have been impOSed by Fed-
eral agencies as conditions of grants and
other a.greements with recipients.
5. Applicabilitll and scope.-Except as
provided below. the standards promul-
gated by this Circular are applicable to
all Federal agencies. If any statue ex-
pressly prescribes policies Or specitlc re-
quirements that differ from the stand-
ards provided herein, the provisions of
the statute shall govern.
The provisions of the attachments of
this Circular shall be applied to subre-
c1pients performing substantive work
under grants that are passed through or
awarded by the primary recipient if such
subrecipients are organizations de-
scribed in paragraph L
6. Definitions.
a. The term "grant" means money or
property provided in lieu of money paid
or furnished by the Federal Government
to recipients under programs that pro-
vide t1.nancial assistance or that provide
support or stimulation to' a.ccomplish a
public purpose. The term "other agree-
ments" does not include contracts which
are required to be entered into and ad-
ministered under procurement laws and
regulations. Grants and other agree-
ments exclude (a) technical a.sslstance
programs, which provide services instead
of money, (b) assistance in the form of
general revenue sharing, loans, loan
guarantees, or insurance,,' and (c) direct
payments of any kind to individuals.
b. The term "recipient" includes the
following types of nonprotlt organiza-
tions that are receiving Federal funds
from a Federal B.gency or through a
State or local government:
Public and private institutions of high-
er education: public and private hos-
pitals; and other quasi-public and pri-
vate nonprotlt organizations such as (but
not limited to) community 3,ction agen-
cies, research institutes, educational as-
sociations. and health centers.
The term does not include ,foreign or
international organizations (such ,as
agencies of the United Nations) and
Government-owned contractor operated
facilities or research centers providing
continued support for mission-oriented,
large scale programs that are Govern-
ment-owned or controlled, or are de-.
signed as federally-funded research and
development centers.
7. Requests for exceptions.-The Omce
of Management and Budget may grant,
exceptions from the requirements of this
Circular when exceptions are not pro-
hibited under eXisting laws.
However, in the interest of maximum
uniformity. exceptions from the re-
quirements of the Circular ?Jill be per-
mitted only in unusual ca.ses. Agencies
may apply more restrictive requirements
to a class of recipients when approved by
the Office of Management and Budget,
8. Attachments.-The standards pro-
mulgated by this Circular are set fQrth
in the Attachmen~s. which are:
Attachment ^ Cash "depositories,
Attachment B Bonding and Insurance,
Attachment C Retention and custodial re-
quirements for records.
Attachment D Program Income.
Attachment E Cost shlLl'lng and matching.
Attachment F Standards tor financial man-
Ilgement systems.
Attachment G Financial reporting require-
ments.
Attachment H Monitoring and reporting
program pertormance,
Attachment I Payment requlremp.nts,
Attachment J Revision ot financial plans.
Attachment K Closeout procedures.
Attachment L Suspension and termination
procedures. '
Attachment M Standard form for applyIng
tor federal assistance.
Attachment N Property management stand-
ards.
Attachment 0 Procurement standards,
9. Exceptions for certain recipients.-
Notwithstanding the provisions of para-
graph 7 if an applicant/recipient has a
history of poor performance, is not fi-
nancially stable. or its management sys-
tem does not meet the standards pre-
scribed in the Circular, Federal agencies
may impose additional requirements as
needed provided that such applicant/
recipient is notitied in writing as to:
a. Why the additional standards are
being imposed;
b. what corrective action is needed.
Copies of such notitlcations shall be
sent to the Office of Management and
Budget and other agencies funding that
recipient at the same time the reCipient
is not1tl.ed.
A-110:1
10. Responsibilities.-Agencies respon-
sible for administering programs that in-
volve grants and other agreements with
recipients shall issue the appropriate
regulations necessary to implement the
provisions of this Circular. All portions
of such regulations that involve record-
keeping and/or reporting requirements
subject to the provisions of the Federal
Reports Act and OMB Circular A-40
must. be submitted to OMB for clearance
before being introduced into use. Upon
request all regulations and instruction:;
implementing this Circular shall be
furnished to tIle Office of Management
and Budget. Agencies shall also desig-
nate an official to serve as the agency
representative on matters relating to the
!mplementation of this Circular. The
name and title of such representative
shall be. furnished to the Office of Man-
3gement and Budget not later than Au-
~ust 30, 1976.
11. lnquiries.-Further information
concerning this Circular may be obtained
by contracting the Financial Manage-
ment Branch. Budget Review Division,
Office of Management and Budget.
Washington, D.C. 20503, telephone 395-
3993.
JAMES T, LYNN,
Director.
ATTACHMENT A.~IRCULAR No, A-IIO
CASH DEPOSITORIES
1. This attachment sets forth standardS
governing the use ot banks' and other In-
stitutions IlS depositories of funds advanced
under grants and other agreements.
2. Except tor situations described In para-
graphs 3, 4, and 5. no Federal sponsoring
agency shall:
... Require physical segregation of cash de-
positories for funds which are provided to a
reclplelllt.
b, Establish any eligIbility requlr.ements
for cash depositories for funds which are pro-
vided to a recipient,
3. A separate bank account shall be requlre
when appllcable letter,ot-credlt agreements
provide that drawdown,s wtll be rrmde when
the recipient's checks are presented to the
bank for payment,
4. Any moneys advanced to 1\ recipIent
which are subject to the contr~~ or regula-
tion of the UnIted States or any of Its omcers,
2gents or employees' (p\lbllc moneys as de-
fined In Treasury Circular No, 1.76, as
amended) must be deposited In a ban'k with
Federal Deposit Insurance Corporation
(FDIC) Insurance coverage and the halance
exceeding the FDIC coverage must be col-
laterally secured.
5, Consistent with the national goal ot
expanding the opportunitIes for minority
busIness enterprises, recipients and sub-
recipients shall be encouraged .to use minor-
Ity banks (a bank which Is owned at lellSt 50
percent by minority group members),
ATTACHMENT B,-CIRCOLAa No, A-IIO
BONDING AND INSURANCE
:. This attachment sets forth bonding Ilnd
Insurance requirements for grants and other
agreements WIth recipients, No other bond-
Ing and Insurance requirements shall be Im-
posed other than those normally required by
the recipient,
2. Except as otherwise required by law. a
grant or other agreement that requires the
contracting (or subcontracting) tor con-
struction or facUlty Improvements shall pro-
vide tor the recipient to follow Its own re-
)
Office of Management and Budget Circular A-110 (7/30/76)
qulrements relating to bid guarantees, per-
formance bonds, and payment bonds unl_
the construction contract or subcontract ex-
ceeds UOO,OOO. ,For those coIlltracts or sub-
contl"&Cts exceeding 1100,000, the Federal
agency may accept the bonding policy and
requirements of the grantee provided the
Federal agency has made a determination
that the Government's Interest Is adequately
protected. It such a determination has not
been made, the minimum requirements shall
be as follows:
a, A lnd guarantee from each buuur equtv-
alent to five percent of the btd price.-
The "bid guaraDltee" shall consist of a firm
commitment such as a bid bond. certl1led
check, or other negotiable Instrument ac-
companying a bid as assurance that the bid-
der will, upon acceptance of his bid, execute
such contractual documents as may be re-
quired within the time speclfled.
b. A performance bond 071. the part of the
contractor for 100 percent of the contract
prlce.-A "performance bond" Is one executed
In connection with a contract to secure ful-
fillment of all the contractor's obligations
under such.contract.
c. A pIIl/ment bond 071. the part of the CQ1l-
tractor for 100 percent of the contract
pr1ce.-A "payment bond" Is one executed In
connection with a contract to assure pay-
meDlt as required by law of all persons sup-
plying labor and material In the execution of
the work provided for In the contract.
3. Where the Federal Government guaran-
tees or Insures the repayment of money
borrowed by the recipient, the Federal
agency, at Its discretion, may require ade-
quate bonding and Insurance If the bondlng
and !<D8urance requirements of the recipient
are not deemed adequate to protect the in-
terest of the Federal Government.
4. The Fed.eral sponsoring agency may re-
quire adequate fidelity bond coverage where
the recipient has no coverage and the bond Is
neededlto protect the Government's Interest.
II. Where bonds are required In the situa-
tions descrtbed above. the bonds shall be ob-
tained from companies holding certificates of
authority sa acceptable sureties (31 CPR
22S).
ATTACHJoD:NT C.-CmctlLAll No. A-110
arn:NTION AND CUSTODIAL UQt1IJI.JIJoD:NTS roa
al:ColUls
1. This attachment sets forth record reten-
tion requJrements for grants and other agree-
ments with recipients. Federal sponsoring
agencies shall not Impose any record reten-
tion requirements upon rec1plents other than
those described below.
2. ExcelU for paragraph I, this attachment
also applies to subreclplents as referred to,
In paragraph II of the basic circular.
3. P1nanclal recorda. supporting documents,
statistical recorda. and all other recorda perti-
nent to an agreement &ball be retalned for a
period of three ye&nl, with the follOWing
qusJUicatlons :
a. It any IItlgatlon. clalm or audit Is started
before the expiration of the 3-year period, the
recorda shsJl be retained until all litigations,
clalma, or audit findJngs involving the recorda
have been l"e801ved.
b. Records for non expendable property ac-
quired wlt.h Federal funda shsJl be retalned
for 3 yeus alter Its ll.naJ disposition.
c. When records are tnLnsferred to or msJn-
talned by the Federal sponsoring agency. the
3-year retention requirement Is not applica-
ble to the recipient.
4. The retention period starts from the
elate of the submJAslon of the ll.naJ e.xpendJ-
ture report or, for grants and other agree_
ments that are reneWed an,nusJly, from the
date of the submLsalon of the annual
ll.nanclal status report.
5. Recipient organizations should be au-
thorized by the Federal sponsoring agency,
If they so desire, to substitute microfUm
copies In lleu of original records.
6. The Federal sponsorln8 agency shall re-
quest transfer of certain records to Its cus-
tody from recipient organizations when It
determines that the records possess long-
term retention value. However, In order to
avoid duplicate record-keeping, a Federal
sponsoring agency may make arrangements
With recelplent organizatIons to retaln any
records that are continuously needed for
Joint use.
7. The head of the Federal sponsoring agen-
cy and the Comptroller General of the United
States. or any of their duJy authorized repre-
sentatives, shall have access to any pertinent
books, documents, papers, and records of the
recipient organization and their subre-
clplents to ma1I:e audits, examinatlons, ex-
cerpts and transcripts.
8. Onle&li otherwise required by law, no
Federal sponsoring agency &ball place re-
strictions on recipient organizatlons that will
limit publlc acCe&li to the records of recipient
organizations that are pertinent io a grant
or agreement except when the agency can
demonstrate that such records must be kept
con.fldentlal and would have been excepted
from disclosure pursuant to the Freedom of
Information Act (5 U.S.C. 562) It the records
had belonged to th,e Federal sponsoring
agency.
A'l'TACHMENT D.-CmcuLAlI No. A-ll0
PIIOGBAlI! INCOJoD:
1. Federal sponsoring agencies shsJl apply
the standards set forth In this attachment In
requiring recipient organizations to account
for progra.m Inrome related to projects
ll.nanced In whole or In part with Federal
funlla. Program Income represents gross In-
come earned by tbe recipient from the fed-
erally supported actlvltlee. Such earnings ex-
clude Intereet earned on advancee and may
Include, but wUl not be Ilm1ted to. Income
from service fees. ssJe of commodltl8ll, uaage
or rental fees, and roysJtles on patents &Dd
coprlghts.
2. Intereet earned on advances of Federal
funds shall be remitted to the Federal agency
ercept for Intereat earned on adVlLIlCe8 to
States or Instrumen.talltles ot . State as pro-
vided by the Intergovernmental Coopera.tlon
Ac~ of 1968 (Publlc L&w 9()....677) .
3. Proceeds from the sale of r.J and per-
sonsJ property either provided by the l"ed-
eral Government or purchased In whole or In
part with l"edersJ funds, shall be handled In
accordance with Attachment N to this cir-
cular pertalnlng to property management,
4. Onl_ the agreement provldea other-
wise. recipients shall have, no obligation to
the Federal Government with respect to
royalties received as a reault of copyrights or
patents produced under the grant or other
agreement (see paragraph 8, Attachment N).
II. All other program Income earned during
the project period &hall be retained by the
recipient and, In accordance with the grant
or other agreement, shsJl be:
a.' Added to funds cOmm1tted to the proJ-
ect by the Federal sponsoring agency and
recipient organization and be used to further
eligible program obJectives:
b. Osed to ll.nsnce the non-Federal &bare
of the project when approved by the Federal
sponsortng agency; or
c. Deducted from the total project calts
In determining the net 008ts On which the
l"ederal share of OOlits wUl be based.
ATTACBlIIlnfT E.-CmCVLA.a No. A-110
C08T 1I1lAaDfO AND 1IIl4T'CIlD<O
1. This attachment setA forth crtterta and
Procec1W'el1 tor tbe allowabUlty of cub and
I
A-110:2
In-kind contributions made by recipients or
subreclplents (as referred to In paragraph 5
of the basic circular) .. or third parties In sat-
isfying COlIt sharing and matching require-
ments of Federal sponsoring agencies, This
attachment also establishes criteria for the
evaluation of In-kind contributions made by
third partlell, and supplements the guidance
set forth In Federal Management Circular
73-3 wltlh respect to cost sharing on feder-
ally-sponsored research.
2. The following definitions apply for the
purpose of this attachment:
a. Profect costs.-Project costs are all al-
lowable costs (as set forth In the applicable
Federal cost principles) Incurred by a recipi-
ent and the value ot the In-k.1nd contribu-
tions made by the recipient or third putles
In accompll8blng the objectlves of the grant
or other agreement during the project or pro-
gram period.
b. Cost sMrtng and matchlng.-In general,
cost sharing and matching represent that
portlon of project or program costs not borne
by the Federal Government.
c. Ctuh contrtbuttom.-Cash contrlbutlons
represent the recipient's cash outlay, includ-
Ing the outlay of money contributed to the
recipient by non-Federal third partles.
d, In-ktnd contrtbutlo1u.-In-klnd contrl-
butlons represent the value of noncaab con-
tributions proVided by the recipient and
non-l"ederal third parties. Only when au-
tborlzed by Federal legislation, may property
purchased with Federal tun<18 be col1llldered
as the recipient's In-kJnd contrlbutloI1ll. In-
kind contributions may be In the form of
charges for rsal property and non-expand-
able personal property, and the value of
goods and services ,directly benell.tlng and
speclflcally Identl1lable to the project or
program.
3. General guldellnea for computing ~t
sharing or matching are as foUoWII:
a. Cost sharln8 or matching may consist
of:
(1) Charges Incurred by the recipient ....
project COlIta. (Not sJl chargllll require caab
outlays by the recipient during tlhe project
period; examples are depreciation and UlIe
charges for buUdlnp and equJpment.)
(2) Project COlIts ll.nanced 'With caab con-
tributed or donated to the recipient by other
non-Federal pubUc agencies and institutions.
and privata organizations and Indlvlduala,
and
(3) Project costA represented by services
and real and personal property, or use there-
at, donated by other non-Federal public
agencies and institutions; and pr1lVats orga-
nizations and Ind.1v!dual8. '\
b. All contribution&, both cub and 1n-
kind, shall be accepted as part of the reclpl-
ent.s calt ahartng and matching when such
contributions meet sJl of th-e following
criteria :
(1) Are vert.ll..able from the recipient's
records;
(2) Are not Included as contributions for
any other federally-assisted program;
(3) Are nec_ry and reasonable for prop-
er and etllclent accompllshment of project
obJectlvea;
(4) Are types ot charges that wouJd be al-
lowable under the appllcable COlIt prlnclplee;
(II) Are not paid by the Federal Govern-
ment under another uallltance agreement
(unless the agreement Is authorized by l"ed-
ersJlaw to be UBed for coat 8b&rlng or match-
Ing);
(6) Are provided for In the approved budg-
et when required by the Pederal agency; and
(7) Conform to other provlslona of thI8
attachment.
4. Values for recipient in-kind contribu-
tions wUl be established. In accordance with
the applicable COlIt prlnclpl8ll.
II. Spec1.ll.c proced\Inl8 for the reclpl.nts In
llStabl\ah1ng the value of 1n-1l:.In4 contrlbu-
I
Office of Management and Budget Circular A-110 (7/30/76)
tlons from non-Federal third parties are set
forth below:
a. Valuation of volunteer serviees,-Volun-
teer services may be furnished by professional
and technical personnel, consultants, and
other skllled and unskllled labor, Volunteer
services may be counted as cost sharing or
matching If the service Is an Integral and
necessary part of an approved pro~ram.
(1) Rates for voluntccr scrviccs,-Rates for
volunteers should be consistent with those
paid for similar work in the recipient's
organization. In those Instances In which the
required skills are not found In the recipient
organization, rates should be consistent with
those paid for slmllar work In the labor mar-
ket In which the recipient competes for the
kind of services Involved.
(2) Volunteers employed by other organi-
zations,-When an employer other than the
recipient furnishes the services of an em-
ployee, these services shall pe valued at the
employee's regular rate of pay (exclusive of
fringe benefits and overhead costs) provided
these services are In the same sklll for which
the employee Is normally paid.
b. Valuation of donated. expendable per-
sonal property.-Donated, expendable per-
sonal property Includes such Items as ex-
pendable equipment, office supplies, labora-
tory supplies or workshop and classroom
supplies. Value assessed to expendable per-
sOI,al property Included In the cost or match-
Ing share should be reasona.ble and should
not exceed the market value of the property
at the time of the donatlon.
c. Valuation of donated. nonexpenctable
personal property. buildings. and land or
U3e thereof.
(1) The method used for charging cost
sharing or matching for donated nonex-
pendable personal property, buildings and
land may differ according to the purpose of
the grant or other agreement as follows:
(a) If the purpose of the grant or other
agreement Is to assist the recipient In the
acquisition of equipment, bulldlngs or land,
the tota.l value of the donated property may
be claimed as cost sharing or ma.tchlng.
(b) If the purpose of the agreement Is to
support activities that require the use of
equipment, bulldlngs or land, depreciation
or use charges for equipment and buildings
may be made, The full va.lue of equloment or
other capital assets and fall' rent31 cha.rges
for land may be allowed provided that the
Federal agency ha.s a.pproved the charges,
(2) The value of dona.ted property wl1l be
determined In accordance with the usual
accounting policies of the recipient with the
following qualifications:
(a) Land and buildings,-The value of
donated land and bulldlngs may not. exceed
Its fall' market value, at the time of donation
to the recipient as established by an Inde-
pendent appraiser (e,g.. certified real prop-
erty appraiser or GSA representatives) and
certified by a. responsible official of the
recipient.
(b) Noncxpend.able personal pro'perty,-
The Value of donated nonexpendable personal
property shall not exceed the fall' market
value of equipment and property of the same
age and condition at the time of donation,
(c) Use of space,-The value of donated
space shall not exceed the fall' rental valee
of comparable space as established by an
Independent appraisal of companble space
and facilities In a privately-owned bulldlng
In the same locall ty:'
(d) Loaned eguipment,-The value of
loaned equipment shall not exceed Its fall'
rental value. .
6. The following requirements pertain to
the reclplent.s supporting records for In-
kind contributions from non-Federal third
parties.
/'
a. Volunteer services must be documented
and, to the extent feasible, supported by the
same methods used by the reclple,nt for Its
employees.
b, The basis for determining the valuation
for personal services, material, equipment,
bulldlngs and land must be documented.
ATTACHMENT F.-CIRCULAa No. A-110
STANDARDS FOR FINANCIAL MANAGEMENT
SYSTEMS
1. This attachment prescribes standards for
financial management systems of recipients.
Federal sponsoring agencies shall not Impose
additional standards on recipients unless spe-
cifically provided for In the applicable sta-
tutes (e.g., the Joint Funding SimplificatIon
Act, P,L, 93-510) or other attachments to this
circular. However, Federal sponsoring agen-
cies are encouraged to make suggestions and
assist recipients In estbaHshlng or Improving
financial management systems when such as-
sistance Is needed or requested.
2. Recipients' financial DUlnagement sys-
tems shall provide for:
a. Accurate, current and complete disClo-
sure of the financial results of each fedcrally
sponsored project or program In accordance
with the reporting requirements set forth In
Attachment G to this circular. When a Fed-
era.l sponsoring agency requires reporting on
an accrual basis, the recipient shall not be
required to esto.bHsh an accrual accounting
system but shall develop such accrual data
for Its reports on the basis of an analysis of
the documentation on hand.
b. Records that Identify adequately the
source and application of funds for federallY'
sponsored activities, These records shall con-
tain Information pertaining to Federal
awards. a.uthorlzatlon3, obligations, unobli-
gated balances, a.,>sets, outlays, and Income,
c. Effective .:ontroJ over and accountability
for all funds, property and other assets. Re-
cipients shall adequately safeguard all such
assets and shall assure that they are used
solely for authorized purposes,
d. Compl\rlson of actual outlays with bud-
get amounts for each grant or other agree-
ment, Whenever appropriate or required by
the Federal sponsoring agency, financial In-
formation should b~ related to performance
and unit cost data,
e. Procedures to minimize the time elapsing
between the transfer of funds from the U,8.
Treasury and the disbursement by the recip-
Ient, whenever funds are advanced by the
Federal Government. When advances are
made by a. letter-of-credlt method, the recip-
Ient shall make draw downs as close as pos-
sible to the time of making disbursements.
f. Procedures for determining the reason-
ableness, allowablHty and allocability of costs
In accordance with the provisions of the ap-
pHcable Federal cost principles and the terms
of the grant or other agreement,
g, A~ountlng records that are supported
by source documentation.
h. Examinations In the form of audits or
Internal audits, Such audits shall be made
by qualified Individuals who are sufficiently
Independent of those who authorize the ex-
penditure of Federal funds, to produce un-
biased opinions, conclusions or Judgments,
They shall meet the Independence criteria
along the Hnes of Chapter 3, Part 3 of the
US, General Accounting Office publication,
Standard,> for Audit of Governmental Orl':an-
Izations, Programs. Activities and Functions,
These examinations are Intended to ascer-
tain the effectiveness of the financial manJ
agement systems and Internal procedures'
that have been established to meet the terms
and conditions or the agreements, It Is not
Intended that each agreement awarded to the
recipIent be examined, Generally, examina-
tions should be conducted on an organiza-
tion-wide basis to test the fiscal Integrity of
I
A-110:3
financial transactions, as well as compllance
with the terms and conditions of the Federal
gran ts and other agreements, Such tests
would Include an appropriate sampling of
Federal agreements. Examinations will be
conducted with reasonabie frequency, on a
continuing basis or at scheduled Intervals,
usually annually, but not less frequently than
every two years. The frequency of these ex-
aminations shall depend upon the nature,
sl?.c and the complexity of the actvllty, These
examinations do not relieve Pederai agencies
of their audit responslbilltles, but may affect
the frequency and scope of such audits.
l. A systematic method to assure timely and
appropriate resolution of audit findings and
recommendations,
3, Primary recipients shall require subre-
clpients (as defined In paragraph 5 of the
basic circular) to adopt the standards In
paragraph 2, above except for the require-
ment In subparagraph 2e, regardIng the use'
of the letter-of-credlt method and that part
of ,,:;ubparagraph 2a. regarding reporting
forms and frequencies prescribed In Attach-
ment. G to this circular.
ATTACHMENT G.-CIRCULAa No. A-110
FINANCIAL REPORTING REQUIREMENTS
1. This attachment prescribes uniform re-
porting procedures for recipients to: sum-
marize expenditures made and Federal funds
unexpended for each alVaI'd, report the status
of Federal cash advanced, request advances
and reimbursement when the letter-of-credit
method Is not used; and promulgates stllnd-
arct forms Incident thereto.
2. The following definitions apply for pur-
poses of this attachment:
a, Accrued expenditures,-Accrued ex-
penditures are the charges Incurred by the
recipient during a given period requiring the
provision of funds for: (1) goods and other
tangible property received; (2) services per-
formed by employees, contractors, subreclpl-
ents, and other payees, and (3) other
amounts becoming owed under programs for
which no current services or performance ~
required.
b. Accrued inco'7le.-Accrued Income Is the
sum of (I) earnlhgs during a given period
from (I) services ,performed by the recipi-
ent: and (II) goods and other tangible
property delivered to purchasers; and (2)
amounts becoming owed to the recipient for
wh1l(h no current services or performance 15
required by the recipient.
c. Federal funds authorized.-Federal
funds a.uthorlzed are the total amount of
Federal funds obHgated by th~ Federal Gov-
ernment for use by the recipient. Th~
amount may Include any authorized carry-
over of unobligated funds from prior fiscal
years when permitted by law or agency
regu la tlon.
d. In-kind contributio7lS.-In-klnd con-
tributions are defined In Attachment E to
this circular.
e. Obligations,-Obllgatlons are the
amounts of orders placed, contracts and
grants awarded, services received, and simi-
lar transactions <luring a given period that
will require payment by the recipient during
the same or l\ future period.
f. Outlays,-Outlays or expenditures repre-
sent charges made to the project or program,
They may be reported on a cash or accrual
basis, For reports prepared on a cash basi..
outlays are the sum of actual cash disburse-
ments for direct charges for goods and serv-
Ices, the amount of Indirect expense charged.
the value or In-kind contributions applied.
and the amount of cash advances and pay-
ments made to subreclpients, For reports pre-
pared on an accrual basis, outlays are the
sum of actual cash disbursements for direct
charl':es for goods. and services. the amount
of Indirect expense Incurred, the value of In-
I
Office of Management and Budget Circular A-110 (7/30/76)
kind contributions applied, and the net In-
crease .(or decrease) In the amounts owed by
the recipient for goods and other property
received, for services performed by employ-
ees, contractors, subredplents and other
payees and other amounts becoming owed
under programs for which no current serv-
Ices or performance are required.
g. Program income.-Program Income Is
dell.ned In Attachment D of this circular. It
may be reported on a cash or accrual basis,
whichever Is used for reporting outlays.
h. Unobligated balance.-The unobligated
balance Is the portion of the funds author-
Ized by the Federal sponsoring agency that
has not been obligated by the recipient and Is
determined by deducting the cumulative
obligations from the cumulative funds au-
thorized.
I. Unliquidated obligatio1\.! .-For reports
prep..red on a cash' basis, unliquidated obli-
gations represent the'amount of obligations
Incurred by the recipient that has not been
paid. For reports prepared on an accrued ex-
penditure basis, they represent the ..mount
of obligations Incurred by the recipIent for
which an outlay has not been recorded.
3. Only the following forms will be ..u-
thorlzed for obtaining tlnanclal Information
from recipients.
a. Fi1l4ncial Stat.u Report (Exhibit 1).
(1) Each Feder&1 sponsoring agency sh..1I
require recipients to use the standardized
Flnancl&1 StatuS Report to report the status
of funds for ..II nonconstructlon projects or
programs. The Federal sponsoring agencies
may, l!owever, have the option of not re-
quiring the FInancial Status Report when
the Request for Advance or Reimbursement
(paragraph 4a) or Report of Federal Cash
Transactions (par&gr&ph 3b) Is determined
to provide adequ&te Information to meet
their needs, except that a tl,nal FInancial
Status Report shall be required at the com-
pletion, of the project when the Request for
Adv&nce or Reimbursement form Is used only
for &d v&nces.
(2) The Feder&1 sponsoring &gency shall
prescribe whether the report sh&1I be on &
cash or accru&1 basis. It the Federal sponsor-
Ing agency requIres accrual Information and
the recipIent's accounting records &l'e not
norm&lIy kept on the &ccru&l basis, the re-
cIpIent shall not be required to convert Its
accounting system, but shall develop such
accru&1 Information through best estImates
based on an &nalysls of the documentation
on hand.
(3) The Federal sponsoring &gency shall
determine the frequency, of the FInancial
Status Report for each project or program
considering the size and complexity of the
particular project or progr&m. However, the
report shall not be required more frequently
than quarterly or less frequently than an-
nually except as provided In subp&ragraph
3a(l} above, A final report shall be required
at the completion of the agreement.
(4) Federal sponsoring agencies shall re-
quire recipients to submIt the Financial
Status Report (original and no more than
two copies) no later than 30 days after the
end of each specified reporting period for
quarterly and semi-annual reports, and 90
days for annual and final reports. Extensions
to reporting due dates m&y be granted upon
request of the recipient.
b. Report ot Federal Co"sh Transactio1l.t
(Exhibit 2).
( I) When funds &re adv&nced to
recipients through letters of credit or with
Treasury checks, the Feder&1 sponsoring
&gencles shall require each recipient to sub-
mit a Report of Federal Ca9h Transactions.
The Federal sponsoring agency sh&ll use this
report to monl tor cash advanced to reclplen ts
llnd to obtain disbursement Information for
each agreement from the recipients.
(2) Federal sponsoring agencies may re-
quire forecasts of Federal cash requirements
In the "Rem&rks" section of the report.
(3) When practical and deemed necessary,
the Federal sponsoring &gencles may require
receipts to report In the "Rem&l'ks" section
the &mount of ca.sh advances In excess of
three days' requirements In the hands of sub-
recipients and to provide short narrative ex-
plan&tlons of actions taken by the recipients
to reduce the exceS3 balances.
(4) Recipients shall be required to submIt
not more than the original &nd two caples of
the Report of Federa.l Cash Transactions IS
working days fOllowing the end of e&ch
quarter. The Federal spon.,orlng agencies
m&y require a monthly report from those
recipients receiVIng advances tot&llng $1
million or more per ye&l'.
(5) Federal sponsoring agencies m&y w&lve
the requirement for submIssion of the Report
of Federal Cash Transactions when monthly
advances do not exceed $10,000 per recipient,
provided that such advance.3 are monitored
through other forms contained In, .this at-
tachment,. or If, In the Federal sponsoring
agency's opinion, the reclplent.s accounting
controls are adequate to minimize excessive
Federal advances.
4. Except as noted below, only the follow-
Ing forms wl1\ be authorized for the reclpl-
en~3 In requesting advances and reimburse-
ments.
a. Request tor Advance or Reimbursement
(Exhibit 3).
(I) Each Federal spon!orlng agency shall
adopt the Request for Advance or Reimburse-
ment as a standa.rdlzed form for all noncon-
!tructlon programs when letters-of-credit or
predetermined advance methods are not used.
Federal sponsoring agencies, however, have
the option of using thIs form for construc-
tion programs In lieu of the Outlay Report
and Request for ReImbursement for Con-
struction Programs (subparagraph 4b).
(2) Recipients shall be authorIzed to sub-
mit requests for advances and reimburse-
ments at least monthly when letters-of-
credit are not used. Federal sponsoring
agenclcs sh&ll not require the su bml.slon o(
more than the original and two caples o( the
Request for Adva.nce or Reimbursement.
I
A-110:4
b. Outlay report and request for reim-
bursement for construction programs (Ex-
hibit 4),
(I) Each Feder&1 sponsoring agency shall
&dopt the Outl&y Report and Request for Re-
Imbur,sement for Construction Programs &s
the standardized format to be used for re-
questing reimbursement for construction
programs. The Federa.l sponsorlr.g agencies
may, however, have the option of substitut-
Ing the Request for Adv&nce or Reimburse-
ment Form (subparagraph 4a) when the
Federal &gencles determine that It provides
adequate information to meet their needs.
(2) Recipients shall be authorized to sub-
mit requests :or reimbursement at least
monthly when letters-of-credlt are not used.
Federal sponsoring agencies sh&ll not require
more than the original &nd two copies o( the
Outlay Report &nd Request for Reimburse-
ment for Construction Programs.
5. When the Feder&1 sponsoring agencies
need Bddltlon&1 Inlormatlon In using these
forms or mare frequ'ent reports, the following
shall be observed:
. a, When additional Inform&tlon Is needed
to comply with legislative requirements,
Federal sponsoring agencies sh&ll Issue In-
structions to require recipients to submit
such Information under the "Rem&rks" sec-
tion of the report.,.
b. When necessary to meet specific pro-
gr..m needs Feder&1 sponsoring agencies sh&ll
submit the proposed reporting requirements
to the Flna.ncl&1 MAnagement Branch, Budget
Review Division, Offlce of Man&gement and
Budget for &pproval prior to submission of
the reports for cle&ran~ under the pro-
visions of OMB Clrcul&r No, A-40,
c, When a Federal sponsoring agency has
determined th&t a recipient's &ccountlng sys-
tem does not meet the Standards (or FI-
nancl!ll Man&gement contained In Attach-
ment F to this circular, additIonal pertinent
Inform&tlon to further monitor grants &nd
other agreements m&y be obtained upon
written notice to the recipient untll such
time a~ the system Is brought up to stand&rd.
d. The Federal sponsoring agency, In ob-
taining Inform&tlon a.s In p&r&gr&phs &, b
and c above, must comply with report clear-
&nce requirements of the Offlce of Manage-
ment and Budget Clrcul&r No. A-40, as re-
vised.
6. Feder..l sponsoring agencies have the
option of sh&dlng out &ny Une Item on &ny
report that Is unnecess&ry for decision-mak-
Ing purposes,
7: Feder&1 sponsoring &gencie~ should ac-
cept the Identlc&1 information from the re-
cipients In machine us&ble format dr com-
puter printouts In lieu of prescribed formats,
8. Feder&1 sponsoring agencle3 may pro-
vide computer outputs to recipients when It
wlll expedite or contribute to the accur&cy
of reporting.
9. Federal sponsoring agencies are author-
Ized to reproduce these forms, The forms for
reproduction purposes can be obtained from
the Offlce of Management and Budget,
FINANCIAL STATUS REPORT I. noDAL "GIHCY AHD OltGAHlZAnONAL IUWIHT TO WHICH ....PO.,. I. IU...rrn:O 2. '.D.RAL QAANT Dll OTH.. IDlNTlfY'HQ' OMS Approved I PAGE OF
HU..... No, 1l(}-R0180 I
(Follow ilUltructiOM on thA baclc) PAQES
J. RICI~IHT ORGANllAnON .'No,... oftd e_pl.t. odd,..... i.d....i,,' ZIP 004.1 ~. IMftLOYla IDUfTlflCAnON HUW.11It S. nelL'lI"" ACCOUNT HUW..1It Ollt IDIHTlnlNG NU".11It ... FINAL REPORT 7. IASII
o VEl o NO o CA'H o ACCRUAL
L 'IItOJE:CT IGRANT "11II00 ISH i...c-o",-,) .. "JUDD COVUID ., THII RfrGRT
'ROM (MG.lA, dGw, .-or) I TO toWn"". dGr. ~"I FROM (fI/ottlA. do.,. ,,_,. TO I ",_,,.. "If. IIlaF)
10, STATUS OF F\JNOS
(0) (b) (c) (d) (e) (f) TOTAL
PROGRAMS / FUNCTIONS/ACTIVITI ES . (g)
I. Net outley. previously reported $ $ $ $ $ $ $
b. Totll cutllY' this '"port pe,lod
C. L",: Program Incom. cAHilts
d. Net culllYs Chil 'Iport porlod
ILin. II min".linr c) I
I. Net outla)'s to date I
(Li", Q plu~ lin,. d) .
I, ! I
Lt..: Non.Federal shlfe of outlays
I. Tot.1 Federal share of 1utll1$
(Lin. , minu. fin, I)
I
h, Total unliquidated obliSltJonl
i. L,..: Hon.rederalshlr. of unliquidated
abU,ltlonl Ihown on IIn. h
I, Federal Ihlra of unllquldlted obligation.
k. Total Fed.ral share of outlays and
unliquidated obligations
t Total cumulativ. amount of Faderal fundi
authorizld
,
",. Unobligated belanc. of federal fund.
.. TVPE Of RATE o 'ROVISIONAL I 0 PRIDIl.R"'Hm n. CPTlflCATIOH SIGNATURE OF AUTHORIZED CERTIFYING DATE REPORT
11. (Place "X" i.. oJ>lWoprial. bin) o "HAL o "XEO I clrtlly to thl boot 01 my knowtodll IncI boo OFFICIAL SUBMITTED
IND.lItICT
O"NII b. ItA TE r e. BASE I d. TOTAL AMOUNT I.. fEDERAL IHARI Illf thlt thll report II correct and complete Ind
thlt .11 oulllys .nd unllquldltod abUllllon. TYPED OR PRINTED NAME AND TITLE TELEPHONE (.4."0 code,
n.. RlMAnl: A.~toc" IUtV ~~w.- ~._.d _._)' ~ 'ttf_'~ ,..q..i,.., 6w 1'<<lnaI. ~.. AQ~ itt _.-.w" -'Q '.,. 10' thl pu"",... sot lorth In thl ._nI ,nu"bn- and nt4lnnott)
I1Oll...tttttl1 l.gWIocliotto documents.
'....101 EXHIBIT J
STAltDAIltD fOR" ZII (7-76)
P'..ertb.. by O,"e. 01 Mena.em.nt a.nd Bud..at
CIRCULAR NO. A,110
J
.
0
-
-
n'
CD
0
-
s:
CJ
:J
CJ
CO
CD
3
CD
:J
-
CJ
:J -
C.
m
c
c.
CO
CD
-
Q
..,
0
C
CJ
..,
)>
I
....
.....
0
-
~
.......
c,.)
0
.......
...,
Q)
-
-
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I
.....
.....
R
en
I
I
Office of Management and Budget Circular A-110 (7/30/76)
INSTRUCTIONS
Please type or print legibly. Items I, 2, 3, 6, 7, 9, lCd, 108, 109, 10i, 101, lla, and 12 are self.explanatory,
specific instructions for other items are as follows:
1'- Ent",
4 Enl.r I'" employer Id.nllncallon numbor o"l.ned by
Ih. U.S. Int.mol Rovenu. S.rvlc. or F1CE (lnstilutlon)
coda, If requi"'d by Iho fed.ral sponsorin. a..ney.
5 This space I. reserved for en lecount' number or other
identlfytng numben that may be assigned by, the
recipient.
8 Enter the month, day. and yea, of the belinnln, and
endl"1 of this project period. For formula grants that
.re not IWllrded on II project baSil, show the grant
period.
10 Th. purpose 01 vertical columns (.) Ihrou.h (I) Is 10
provld. financl.1 dal. IOf each pro.ram, lunctlon, and
.ctlvity in Ih. budcat IS approved by Ih. fedoral .pon.
50flnl .pney. If additional columns are needed, use ..
many .ddltlon.1 lorm. IS needed .nd Indlcalo pa..
number In space provtded In upper right: however, the
lot.,s 01 .11 proll""m., function. or .ctivlll.. should bo
shown in column (Ill 01 Ih. first p.... for ..r..menls
part.inln. to sav.ral CaI.IOIl 01 fed.ral Dom..llc
Assist.nca PIOll'.m. Ih.1 do not roqui", . furth.r
functional or activity classification breakdown, enter
und.r columns (.) Ihrou.h (I) Ih. 11/1. ollh. pro.r.m.
For Insnts or other assistance Ilreements contalnlnl
muttlpl. programs where one or more procrams require
I further breakdown by function or activity, use I
..peNlte form for Ilch program showing the applicable
functions or activities In the seplrete columns. For
g.nts or other assistlnce agreements containing sev.
erel function, or activities which are funded from
several programs. prepare a 'Separate form for each
.ctlvlty 0' function wh.n requesled by Ih. f.d.ral
aponsorin. o..ney.
lOa Enlar Ih. nat outley. This .mounl should bo Ih. .am.
.s Ih. .mount ",ported In L1n. 10. ollhe I.st ",port,
If there has been an adjustment to the amount shown
prwtously, pl.... .ttach ..plon.llon. Show z.ro It Ihls
Is Ih. Inlll.1 raport. '
lOb Enl.r Ih. 101.1 .,.,.S PF'Dllram outl.ys (I"s rebat..,
",Iunds. .nd olh.r discounts) lor Ihl. report period,
Includln. dl.bursem.nts 01 cash ",.lIzed .. PF'Dllram
Incom.. fOf reports IMI .ra pr.pa~ on . ca.h
bali.. outlays Ire the sum of actual cash disburse.
ments for good. and .ervkes, the amount of Indirect
expense charaed, the value at In.kind contributions
.pplled. and Ih. .mounl 01 cash edYltnces .nd
p8ym.nls m.d. 10 conlractors .nd .ubtlranl..... for
reports prepantd on an &ccroed expenditure besls. out.
lays Ire the sum of actual cash disbursements, the
amount of Indirect expense incurred. the value -of In.
kind contribullon. .pplled. and Ih. nat Incrae.. (Of
decraa..) In Ih. .mount. owed by Ih. redpienl for
coods .nd oth.r proparty received and for servlc..
performed by employees. contractors, subBrantees, and
othar pay....
1'- Ent",
lOe Enter the amount 0' an program Income realized In
this period that is required by the term, and con.
dilion. or Ihe Fede,a' award 10 be deducted lrom lolal
project costs. for reports prepared on . cI.h basis,
enter the amount of cash income received durinl the
reporting period. For reports prepared on an accrual
basis, enter the amount 0' income eerned since the
beginning of the reporting period. When the terms or
conditions ellow program Income to. be added to the
totel eward. eJl:plain I" remar1tl. the source. amount
and disposition of the Income.
lOt Enter amount pertainIng to the non.Federel share of
program outlays Included In the amount .C?..n line e.
10h Enler lolal omounl 01 unll<luld.led obli.ollons for Ihls
project or pro,ram, including unliquidated obligations
to subgrantHS and contractors. Unliqutdated obliga.
tlons are:
Cash basis--obllgatlons Incurred but not _paid;
Accrued expenditure ball~bll8atiQns Incurred but
10< whlch..n oullay hIS nol baan recorded.
Do not include any amounts that have been Included
on lines e throulh I. On the flnal report, line h should
hive a zero belance.
10/ Enl.r Ih. f_ral sha", 01 unllquldoled obli.allons
shown on line h. The amount shown on this line $h~uld
be the dl".rence between the amounts on lin.. h and I.
IOk Enter the sum of the amounts shown on lines g and ,.
If the report II final the report should not contain any
unllquldelad obll..llonl.
10m Enler Ih. unobll..led balance 01 Federal funds, This
amount should be the difference between lines k and I.
11 b Ent.r rata In .lfact durin. Ih. r.portln. parlod.
Ilc Enter .mount of the base to which the I1Ite was .pplied.
lId Enter total amount 0' Indirect colt charged durlnl the
raport period.
lIe Enter amount 0' the Federll share charged during the
"'port parlod.
If more thin onl rite was applied during the project
period. include a separate schedule showing bl.e.
Igalnst which the Indirect cost rates were applied, the
respective Indirect rates the month, day. and year the
indirect fltM were In effect. amounts of Indirect ex-
penH chl"ed to the protect. and the Federal share Q'.
indirect expense charged to the project to date.
A-110:6
"I
.
.
I
,I
Office of Management and Budget Circular A-110 (7/30/76)
A-110:7
TRANSACTIONS REPORT Approved by Office of Monow.menl ond Budwol, No. 80-ROl82
FEDERAL CASH 1. fedl!ral StJOftsorinl laMCy and orrlnilltionll .Ie",.,,' to which this report
is submitted
(See instructiO?l8 on the back. If report is for more than one grant or
assistance agreement, attach completed Standard Form. !7!-A.)
2. RECIPIENT ORGANIZATION 4. fodenl I",nl .. coth.. idonlifi... 5~ Recipiettt'. ICCOU'" .umber ..
lion number Icl...tilyinl .u",beI
Name : 6. lot1Ol of uodil nu",ber 7. lilt per"'...' 'f'Oucher rtUlnW
NM",hn Give total number for this perind
aM Street :
8. Po"",nl Youch.n crodilod to 9. TrelSury Chec~1 ,.cei~d (wMther
)'OUr KCOUnt Of" Nt depo'lhd)
Cit", StGu 10. PERIOD COVERED BY THIS REPORT
and ZIP Code:
3, FEDERAL EMPLOYER ~ fROM (m_'h, cia", "...r) TO (month. cia" ."aT)
IDENTIFICATION NO.
a. Cash on hand beginning of reporting period $
b. Letter of credit withdrawals
c. Treasury check payments
11, STATUS OF
FEDERAL 'd. Total receipts (Sum of lines b and c)
CASH e. Total cash available (Sum of lines aflnd d)
f. Gross disbursements
.
(See specific g. Federal share of program income
ins truction.~
on the back) h. Net disbursements (Line f minus line g)
i. Adjustments of prior periods
J. Cash on hand end of period $
12. THE A'vIOUNT SHOWN 13. OTHER INFORMATION
ON LINE IlJ, ABOVE,
REPRESENTS CASH RE. a. Interest income $
QUIREMENTS FOR THE
ENSUING
Da1ls b. Advances to subgrantees or subcontractors $
.
14. REMARKS (A ttach addit40nalsheets of plain paper, if more space is required)
15.
SIGNATURE DATE REPORT SUBMITTED
I certify to the best of my
knowledge and belief that AUTHORIZED
this report is true in all re-
spects and that all disburse- CERTIFYING TYPED OR. PRINTED NAME AND TITLE
ments have been made for
the purpose and conditions OFFICIAL
of the grant or agreement I (Ar_ C...u) ,IN.....b...) (E:I......... )
TELEPHONE I
CERTIFICATION
THIS SPACE FOR AGENCY USE
272-101
EXHIBIT 2
STANDARD fORM 272 (7-76)
Prescribed by Offico of Monalemenl ond Budcet
CIRCULAR NO. A-1\O
I
I
Office of Management and Budget Circular A-110 (7/30/76)
A-110:8
INSTRUCTIONS
P1eeH type Of' print legibly. Items 1, 2, 8, 9, 10. 11d. 11e, 11h, and 15 are self explanatory, specific
instructions fOf' other items are as follows:
..
1,.".
E"trv
3
Enter employer identification number assigned by the
U.S. Internal Revenue Service or the FICE (institution)
code.
If this report covers more then one grant or other
egreement. leave Items 4 and 5- blank and provide the
information on Standard Form 272-14., Report of Fed-
erel Cash Transactiofts--Continued; otherwise;
4
Enter Federel grant number, agreement number. or
other identifying numbers if requested by sponsoring
agency_
5
This spece reserved for .n account number or other
Identifying number that may be assigned by the re-
cipient.
6
Enter the letter of credit number that applies to this
report. If all advances _re made by Treasury check.
enter "NA" for not applicable and 'eave items 7 .nd 8
blenk.
7
Enter the voucher number of the last letter-of-credit
peyment voucher (Form TUS 5401) that was credited
to your account.
11.
Enter the total amount of Federal cash on hand at the
beginning of the reporting period Including all of the
Federal funds on deposit, Impre. funds. and und..
posited Tre.sury ch<<ks,
llb
Enter total amount of Federal funds received, through
payment voucllers (Form TUS 5401) tnat were cred-
Ited to your accOUflt during the reporting period.
llc
EMer the total amount of all Federal funds received
dun". the reportinc period through Treasury checks.
wMther or not depMited,
llf
E...... the total Fedenl cash cn.bvrsements. me.
durlnc tM ~ period. Includtng cash received
.. Pf'OFIIm Income. Disbursemems .s used here .Iso
Include tne .InOWM of advances and payments less
refunds to 5Ubg.."t..s or OO"....ctors. the ,ress
amount cY. direct Mlari.. and wee... Includil1l the
Eft try
Itfml
emplopee's share of benefits if treated as a direct cost,
interdepartmental charges for supplies and services,
and the amount to which the recipient is entitled for
Indirect costs.
111 Enter the Federal share of program income that was
required to be used on the project or program by the
terms of the grant or al"eem,~nt.
lli
Enter the amount cf all adjustments pertaining to prIor
periods affecting tne ending balance tnat have not
been included in any lines above. Identify each grant or
e.reement for which adjustment was made, and enter
an explanation for each adjustment under "Remarks."
Use plain sheets of paper If additional space is required.
11j
Enter the total amount of Federal cash on hand at the
end of the reporting period. This amount should include
all fund, on deposit, imprest funds, and undeposited
funds (line e. less line h, plus or minus line i).
12
Enter the estimated number of days until'the cash on
hand. shown on line 111. will be expended. If more than
three days cash reqirements are on fland, provide an
explanation under "Remarks" as to why the drawdown
WIIS made prematurely. or other reasons for the excess
cash. The requirement for the explanation does not,
apply to pres~heduled or automatic advances.
13a
Enter the amount of Interest earned on advances of
Federal lunds but not remitted to the Federal agency.
If this Includes any amount earned and not remitted to
the Federal sponsorin. agency for over 60 days, explain
under "Remarks." Do not report interest earned on
advances to States,
13b
Enter amount of advance to secondary recipients in-
ctuded in item 11 h.
,
14
In addition to providing explanations as required above,
liye additional explanetion deemed necessary by the
recipient and for irtfonnation required by the Federal
sponsoring agency in compliance with governing legis-
lation. Use plain sheets of paper If additiol1al spa~ ia
required.
C':
I I
Office of Management and Budget Circular A-110 (7/30/76) A-110:9
FEDERAL CASH TRANSACTIONS REPORT I
CONTINUATION
(This f<>rm is completed Gnd attGched to StanOOTd Form t7t OftlV ...hell
repcwtin.g 1'Pt.Orl!l th4.n on:.e gra:nt or a..ssilltancc a.gret'rJ'I4nt.)
. 2. RECIPIENT ORGANIZATION (Give """'" onlV a.7 .hOWll ill it.", t. SF
t7t)
'Approved by Office of Management an'; Budgo.', No.
SO_ROI S2
1. FEDERAL SPONSORING AGENCY 1<ND ORGANIZA,
TIONAL ELEMENT TO WHICH THill REPORT IS SUB,
MITTED
3. PERIOD COVERED BY THIS R(1IoRT (A. showll Oil SF
t7t)
4. list information below lor e8ch irant or other agreement covered by this report. Use additional 'anns it more space is required.
FROM (~onth. .... .-,r)
TO (MOtIU.. do" weor)
FEDERAL GRANT OR OTHER ",ENTIF I RECIPIENT ACCOUNT "'UMBER FEDERAL SHARE OF NET DISBURSEMENTS
CATION OR OTHER
IDENTIFYING NUMBER NET DISBURSEMENTS ( c.... CUMULATIVE
{Show .. IUbdivisioll bll oth'T id""ti- af...b.,......lI''''' I... pro.....'" i,... NET DISBURSEMENTS
f.l:mg ll"m.l>lTl if ~equiT6d bll the eo",.. ,,,('ft,,"'1 FOR REII'ORTlNG
.d...al Sp.....onllg,Ag.llCV} PERIOD
lal Ibl Icl Id\
$ $
..-
,
,
.
.
I .
,
I
5. TOTALS (SMuld CMT.."tmd with a.....Ullto ,.howll Oil SF t7t a.o
follows: CO I..",,, (cJ tM sa"", a.o lill. 11 h; coJ"""" (d) tM 'Ilm of Ii"t,s,
J Ih a"d Iii, .r (hiS .SF t7t and cumulativ. disbur..m""to .h""", Oft $
ta., Tep<>rt. Attach ".pla.!tGtiolt of allll diff...."""'.) $
272-201
STANDARD FORM 272-A (7-161
Pf'..crf"~ by Office 0' Maneg........' md Budget
CIRClJLAR NO, A,IIO
1 i
Office of Management and Budget Circular A-l10 (7/30/76) A-110:11
INSTRUCTIONS
Please type or print legibly, Items 1,3,5,9, 10, 11c, 11e, 11f, llg, 11i, 12 and 13 are self'explanatory:
specific instructions for other items are as follows:
It_ En'",
2 Indicate whether request is prepared on cash or ac.
crued expenditure basis.. All requests for advances
shall be prepared on a cash basis.
4 Enter the Federal grant number, or other identifyinl
number assigned by the 'Federal sponsoring agency~ If
the advance or reimbursement is for more than on.
grant or other agre-ement. insert N/A; then, show the
aggregate amounts. On a separate sheet. list each
grant or agreement number and the Federal share of
outlays made egainst the grant or agreement.
6 Enter the employer identification number assigned by
the U.S. Internal Revenue Service. or the flCE (institu.
tion) code if requested by the Federal egency.
7 This space is reserved for an account number or other
Identifyinl number that may be assigned by the
recipient.
8 Enter the month. day. and year for the beginning and
ending of the period covered in this request. If the re.
quest is for In advance or for both an advance and re.
imbursement, show the period that the advance will
COYer. It the request Is for reimbursement. shc:Sw the
period for which the reimbursement is requested.
Note: The Federal sponsoring agencies have the option of
requiring recipi..,ts to complete items 11 or 12, but not
both. Item 12 should be used when only II minimum
amount of infol'T'netion is needed to make an advance
and outlay information contained In item 11 can be
obtained In a timely manner from other repprta.
II The purpo.e of the y-.tieel column. (eJ, (b), end (e), i.
to provide spece for leparete cost b~akdowns when II
project has been plenned end bvdgelod by program.
function. or activity. If additional columns are needed,
11_ Ent",
use as many additional forms as needed and indicate
page number in space provided in upper right: how-
ever, the summary totals of all prolrams. functions.
or activities should be shown in the "total" column on
the fir.;t page.
l1a Enter in "as of date". the month. day, and year of the
ending of the accounting period to which this amount
applies. Enter program outlays to date (net of refunds.
rebates. and discounts). in the appropriate columns.
For requ~ts prepared on a cash basis. outtays en! the
sum of actual cash disbursem&nts for goods and servo
ices. the amount of indirect expenses cha....ed. the
value of in. kind contributiOf:'J. applied, and the amount
of cash advances and payments made to subcontrac.
tors and subr~ipienB. For requests prepared on an
accrued expenditure basis. outlays are the sum of the
actual cash disbursements. the amount of Indirect ex.
penses incurred. and the net Increase (or deerease) In
the amounts o~ by the reciptent for goods end ottlM
property received and for services performed by em-
ployees, contracts, .ubgranl... end other payees.
11 b Enter the cumulative cash income received to date. if
n!Qunts are prepared on a cash ba.is. For requests
prepared on an accNed expendtture basis. enter the
cumulative income earned to date. Under either basis.
entar only the amount applieable to program income
that wn required to be used for the project or pm-
.r8m by the terms of the grant or other aSteeme"t.
l1d Only wt1en making requests for advence JMyments.
enter the total estimated amount of cash outlays that
'Nil! be made during the period covered by the advance.
13 Complete the certification before submitting this
request.
"
)
I
Office of Management and Budget Circular A-110 (7/30/76)
Approved by Olllco 01 Monogomont ond PAGE o.
OUTLAY REPORT AND REQUEST FOR REIMBURSE. Budget. No. BO-ROIBI 'AOES
MENT FOR CONSTRUCTION PROGRAMS 1. TYPE 0' REQUEST 2.. BASIS OF REQUEST
(S..l,..tTUctiOft.l Oft baek) o FINAL o PARTIAL ' o CASN o ACCRUAl.
3. FEDERAL SPONSORINQ AGENCY AHD ORGANIZATIONAL ELEM[NT TO 4. nOERAl CRAf4T 011 OTHER S. PARTIAL PAYMENT REQUEST NO.
WHICH THIS REPORT IS SUBMITTED IDENTlFY1NQ HUM'ER ASSIGNED
BY FEDERAL AGENCY
a. ~~~"'OEYREA IDENTl"CATlON 1" RECIPIENT ACCOUNT OR OTNER PUlmI canIID 19' nllI ......
IDENTlfYlNQ NUMBER
'ROM (JlOIIfA. ..... ....1 TO (II........... ,....~
.. RECIPlIEHT ORGANIZATION lD. PAYEE <<"...,...... ....-... PH ..., II MI..., ... ... ')
11_ .. 11_ ,
N.. ..... No. ..
s,.... , s..... ,
c.... cu..
Stow a.... Str." ....
~lP C__: ZIP C" :
11. STATUS OF FUNDS
PROGRAM!>-FUNcnON~CTIVITIES
CLASS'f'ICATION (A) (~) (0) TOTAl.
..,
o. Admlnlstratfve expense $ $ $ $
b. Preliminary expense
c. Lond. structures. right-of.woy
d. Architectural engineenng basic fees
o. Othor orchltectural ongineering foes
f. Pro/ect Inspection i_
g. Land development
h. RelocltJon expense
,. Relocation payments to Individuals and
businesses
J. Oemolttlon Irtd removal .
k. Construction and project Imp",vement
cost
L Equipment
m. Miscellaneous cost
n. Total cumulative to dete (sum 01 lines
othru m)
o. Deductions tor program Income
p. Net cumulative to date (line n minus
line 0)
q. Federal share to date
r. Rehabilitation grants (100% reim.
bursement)
s. Toto' Foderal share (sum of lines q
and r)
t. Federal payments prevKJusly ..
quested
u. Amount requltSted tor reimbu~ement $ $ $ $
v. Percentage 0' physicel completion 01 % %
project % %
12. CERTIf'ICATION SIGNATURE 0' AUTHORIZED CERTIFYINQ DATE REPORT
OFFICIAL SUBMI"ED
I certify that to the best of my knowledge
end belie' the billed costs or disburse- o. RECIPIENT TYPED OR PAINTED NAME AHD TiTlE TELEPHONE I"'.... -".
mints are in accordal"Jce with the te~ ......~ .-wi ._---.J
of the project and that the reimbursement
represents the Federal share due which SIQNATURE 0' AUTHORIZED CEATIFYINQ DAT'[ SIGNED
has not been previously requested and OF'ICIAI.
that an inspection has been perlonned b. Representative
and all work is In aCCO;dance with the certi fyi"1 to line TYPED OR PAINTED NAME AHO TITLE TELEPHONE 1"'''_ ~
llv.
tenns 0' the 8\118rd. ......., ... _c...w.)
271-101
EXHIBIT 4
STAHDA.RD '0.... 771 (7-76)
ror..-cr1beod by o'"~ 0' ...".~ .ftd Budpll
CIRCUL AR NO. "110
A-110:12
,
1
I
Office of Management and Budget Circular A-110 (7130/76)
INSTRUCTIONS
Please type or print legibly. Items 3, 4, 5, S, 9, 10. 11s. and 11 v are self-explanatory; specific instructions
for other Itema _ as tollows:
- --"
..... .... __ -. If the ,equal Ie _. ....
_ _ _lei rep.-..t .... _ _ of ....
~
Z lI...... ....eth.. _ .... ....- .... .. --
__ er _.-__,
. _.... ~ ....nt_ ......._......... by
the U.S. 1_""" _..._Iernel ~I
_"rwq_~""__J.
7 lllls ._ Is __ "" an _nt num_ or_
identify.... nu_ _ .... - ...- lor ....
~.
II The .....".,.. ef _I _...... ...1 throuch (el Is ID
..-lde _ fer _rate - -- - ·
IMp pl'ojeet h_ ...... ,..._ ..... ~ by __
....... -.. .. -!tv. If _na1 -.. ...
_ed. UM _ "'.ny .""_....... - -.....
IIldIcaIe _ _, '" _..- in _ rI8fII;
_. th. _....ry _Ie ef .. ,.,......., fu_
_, or __ should t., __ '" _ _-
_mil en Ihe Int ...... All _ .... __ ...
. ......- -
11.1 __...__....--.--.1
_. _.. of _ .nd 'IIl' _ admln_
_ _lite ._nt of __
_._by-"'~"""--
__ntef__....___
11~ _ _ ~lnlJ" lite ~ of ~ and
.......... ....Id.. sunrwys ..... _ .ald.. _
hot... ..... .. _ ~ __ prior ID _
1Of1_ M'. .
JJ. _..._dl.-y______
_ ", lend. ........ ___ ..... _ riatlt-of.
""".
I W ..... _ _ .... _ ef __.., .......-..
11.1 _ _ __rat ......-nIJ __ Do not
Include..... _ __....... d.
111 I_"""",a"'" _ .... of ....- .....
--
III [_..___...._~of
..... ...... th. ..-.,. ,_ of .... pent is lend
1Inp.. .....nt. .",. _ ,..ulni,. ID lend ~
_ ~ _ with _jor _
_ _ __,..", _ ........,...... ._ en
-...
11h -. lite _ _ .- Ie ,...w. _
~ .......... Mtd .... costs ", ..... 11 fTMn( ........
.... <- _I, Do not '-hod. __ _ ""
_......in_____
_be_"'__on_..
IIi Inte, _ -.ount ", _ _ts ...... ~....
nlCipient to ~eed ~"S. ,.",.. busi.... con.
cern.. Ind non,.... ....nizatiolw.
1_ .....
111 Inter..- _I...... .nd _ of -I>I<>Y- of th<t
ote:Ip.nt and ~ to third perty contrect"" cIi.
NdI\r ~ in perl<>nninl demoMion '" '_1 01
_ntCtuIWo ,___ dtwIoped land. All p""'_ from the
_ of seMItIt '" _ """""", 01 stNdullS should be
_ ID t". ~ thereby r9ftectinl _
__ if __ br .... Fed....laa'''''Y.
Ilk E_ _ ...-_ auoc:_ with .... actual con.
.en.ction of. BddiUoft N. 0( restOf1ltton of a facility.
Aha. indude in 0.. category. the amounts for project
Im__ _ os -. strttts. l_ecapinB.
- 1liIMI...
lit Enter ...-nts .... .11 """",",ent, both ".ed ,nd mOVe
.bM, ..,_ ef ~ ...., lor construction. For
....m..... __ntly attached leboratory tobl.s, buill.
lot _10 __ syst...... _bit desks. e,,"lrs. ,nd
~ -....-.
n... _.... __ "" .. ...... _ specifically men.
--
lIa Enter the _ cumw_ ..-<lnt to data which
_Ill ___oIl_...POUCh m.
lie _ the _ _nt of _...m mcome applied to
.... ....nt or contraot ..,..ment except Income In-
_ ... _ j. ~ _ . ..perale shill of pe.....
___tw-tl_I_..
)1~ ....... the I'tet cumuletiYe amount to date which lhould
lie the ........... ....... on Hne n minus the amount
- line o.
II'l _ the __ _.. of _ amount shown on II... p.
nr Enter the _ of __n Itlnt peym.nts
_ID 1_ _ _..m IlCistation plOVid..
100 ~ ptyOMM ~ the ,....... ~.
lIt Enter .... _ _ tI F-...I pe_ts pn9k>usly
~ " _ "'"" .. _ "" ~I ,.;m.
-.
u.. _ _ _ now bel... nq_ ,.. -....
........ ..". ........ ....... _ the "i~enc. between
tf\e ~ ....... ... '"'- . aM t. If diff...ent. ex-
,.... _a __-.
... To _ ........, ~ "" ~ _ who ~ rt'
__ fw.... Clt'It'ItIon of th. prosram, TM d.t.
_ be the __ ..... the "'"" is submitted '" th.
F__.
la To be ...._ "" _ _ reo.....nt.lI'"
who . C:.rttfyinc to the ~nt of P")ject completion
_ pnMded far in the llInfts fJIf tM ,,."t or acr.ernent.
A-110:13
"
I
Office of Management and Budget Circular A.110 (7/30/76)
A'M'ACHMENT H.-CIRCULAR Na. A-110
MONITORING AND REPORTING PROGRAM
PERFORMANCE
1. This attachment sets farth the prace-
dures far manltarlng a.nd repartlng pragra.m
perfarmance .of recipients.
2. Recipients $hall manltar the perfarma:J.ce
under grants and ather agreements a.nd,
where appraprlate. ensure that time sched-
ules are being met, prajected wark units by
time perlads a.re being accompllshed, and
ather perfarmance gaals are being achieved.
This review shall be made far each pragram,
functlan, .or activity .of ea.ch agreement a.s set
farth In the appraved a.ppllcatlan .or a.ward
document.
3. Recipients shall submit a perfarmance
repart (technical repart) for ea.ch agreement
that brlefiy presents the fallawlng Infarma.-
tlan far ea.ch pragram. functlan, .or 1Lctlvlty
Invalved a.s prescribed by the Federal, span-
sarlng agency:
a. A comparlsan .of actual accampllshments
with the gaals establlshed fa,r the period. the
findings of the Investlga.tor, .or bath. It the
.output .of pragra.ms .or prajects ca.n be rea.dlly
qua.ntlfied, such qua.ntlta.tlve da.ta. shauld
be rela.ted ta cast data. far camputa.tlan .of
unit casts.
b. Rea.sans why established gaals were nat
met.
c. Other ,pertinent Infarma.tlan Including,
when 1Lppraprla.te, a.nalysls and expla.na.tlan
.of cast .overruns .or high unit casts.
4. Except a.s pravlded In a. and b belaw.
a.nd In subpara.gra.ph 3a.( I}, Atta.chment G,
recipients sha.ll submit the perfarma.nce .or
technical reparts ta Federa.l spansarlng 1Lgen-
cles a.nd the Flna.nclal Sta.tus Reparts CaV-
erlng the same perlad In the Crequency estab-
lished by Attachment G oC this Clrculll't a.nd,
where appraprlate, a fina.l technical .or per-
formance repart after campletlan of the
praject an a date specified by the Federal
spansarlng agency. The Federal spansorlng
agency shall prescribe the Crequency with
which the perfarmance reparts wlll be sub-
mitted with the request far advance .or reim-
bursement when tha.t farm Is used In lieu
.of the Flna.nclal Status Report. Except as pra-
vlded far In pa.ragraph 5 belaw, perfarmance
reparts shall nat be required mare frequently
than quarterly .or less frequently than an-
nua.lly. Federal spansorlng agencies may
waive the requirement far recipients ta sub-
mit perfarmance reparts with the financial
reparts under the fallawlng clrcumsta.nces:
a.. When the recipient Is required to sub-
mit a perfarmance repart with a. cantlnua-
tlan .or renewal a.ppllcatlan.
b. When the Federa.l spansarlng agency de-
termines that on-site technical Inspectlans
and certified campletlon dp,ta wlll be suffi-
cient ta eva.luate canstructlan prajects.
C. When the Federal sponsarlng agency re-
quests annual financla.l reparts an a fisca.l
year ba.sls but It Is necessary to get annua.l
prcgress reparts an a. calenda.r year basis.
5. Between the required perCarma.nr.e re-
parting dates, events may .occur that have
slgnlfica.nt Impa.ct upan the praject .or pra-
gra.m. In such Insta.nces, the recipient shall
Infarm the Federal spansarlng agency as saan
a.s the fallawlng types .of candltlans became
knawn:
a. Prablems, delays, .or adverse candltlans
that wlll materla.lly affect the a.blllty to at-
tain pragra.m .objectives, prevent the meet-
Ing .of time schedules a.nd gaals. .or preclude
the attainment aC praject work units by es-
tabllshed time perlads. This dlsclasure shall
be a.ccampanled by a sta.tement of the actlan
taken, .or cantemplated, and any Federal a.s-
slstance needed ta resalve the sltua.tlan.
b. Favara.ble developments .or events tha.t
ena.ble time schedules to be met sqaner than
a.ntlclpa.ted .or mare wark units ta be pra-
duced tha.n .originally prajected.
6. If a.ny perfarma.nce review canducted
by the recipient dlsclases the need far change
In the budget estlma.tes In a.ccarda.nce with
the criteria establlshed In Attachment J Ca
this Clrcula.r, the recipient shall submit a. re-
quest Car budget revllslan.
7. The Federa.l spansarlng agency sha.ll
make site visits a.s frequently as practlca.ble
to:
a.. Review pragra.m a.ccampllshments a.nd
management cantral systems, a.nd
b. Pravlde such techn1ca.1 a.sslstance a.s
ma.y be required.
8. Federa.l sponsoring a.gencles shall submit
prapased technica.l a.nd perfarma.nce reparts
ta the Office .of Ma.na.gement a.nd Budget far
a.pprava.1 In accorda.nce with the repart clea.r-
a.nce requirements .of OMB Clrcula.r Na. A-40
as revised.
A'M'ACHMENT I.--<:mcuLAR Na. A-110
PAYMENT REQUIREMENTS
1. This a.tta.chment esta.bllshes the re-
quired methads .of ma.klng pa.yments to recip-
Ients. These methads wl11 minimIze the time
ela.pslng between the disbursement by these
recipients a.nd the tra.nsfer .of funds from the
United Sta.tes Trea.sury to these recipients
whether such disbursement occurs prlar to
.or subsequent to the tra.nsfer at funds.
2. Payments ca.n be ma.de ta recipients
thraugh a. letter-af-credlt, a.n advance by
Treasury check, .or a. reimbursement by Treas-
sury check. The Callawlng definltlans apply
far the purpase .of this a.tta.chment:
a.. Letter-o/-Credlt.-A letter-of-credit Is
a.n Instrument certified by a.n a.utharlzed .offi-
cial .of a. Federa.l spansarlng agency tha.t au-
tharlzes a. recipient to dra.w funds when
needed Cram the Treasury, thraugh a Fed-
eral Reserve ba.nk a.nd the reclplent.s cam-
merclal bank, In a.ccarda.nce with the pravl-
slans .of Treasury Clrcula.r Na, 1075, as re-
vised.
b. Advance by TreC1.3ury' check.-An a.d-
va.nce by Trea.sury check Is a. payment ma.de
by a. Treasury check ta a. recipIent upan Its
request be fare autla.ys a.re ma.de by the
recipient, .or thraugh the use .of predeter-
mined pa.yment schedules.
c. Reimbursement by Treasury check.-A
reimbursement by Trea.sury check Is a. Trea.s-
ury check pa.ld to a. recipient upan request
far reimbursement fram the recipient.
3, Except far constructlan grants a.nd
ather canstructlan a.greements Car which ap-
tlana.1 pa.ymentmethods a.re autharlzed. as
described In pa.ragraph 5, the letter-aC-credlt
methad sha.ll be used by Federal spanso~lng
agencies If a.lI .of the fallowing candltlans
exist:
a. It there Is or wUl be a. cantlnulng rela-
tlanshlp between a. recipient a.nd a. Federal
sponsarlng a.gency for a.t least a. 12-manth
perlad a.nd the tata.1 amaunt of adva.nce pay-
ments expected ta be received within that pe-
rlad fram the Federa.l sponsarlng a.gency Is
$250,000 .or mare, a.s prescribed by Trea.sury
Clrcula.r Na. 1075, For jalnt funded prajects
the Treasury has a.uthorlzed a. dalla.r criteria
.of $120,000.
b. if the recipient has est'a.bllshed .or dem-
anstrated ta the Federa.l spansarlng agency
the wllllngness and a.blllty to ma.lntaln pra-
cedures tha.t will minimize the time ela.ps-
Ing between the transfer .of funds and their
disbursement by the recipient,
c. If the recipient's fina.nclal ma.nagement
system meets the sta.nda.rds far fund cantrol
and accauntablllty prescribed In Atta.chment
F ta this Clrcula.r. "Sta.nda.rds far Flnancla.1
Ma.nagement Systems!'
4. The method aC adva.nclng funds by
Treasury check sha.ll be used. In accarda.nce
with the pravlslans .of Trea.sury Clrcula.r Na.
I
A.110:14
1075, when the recipient meets a.ll of the re-
quirements specified In pa.ra.graph 3, a.bave,
except thase In subpara.gra.ph 3a,
5. The reimbursement by Trea.sury check
methad shall be the preferred methad It the
recipient daes nat meet the requirements
specified In subpara.gra.phs 3b a.nd 3c, a.bave.
At the aptian .of the Federa.l spansarlng
agency, this methad ma.y a.lso be used an a.ny
canstructlan agreement, .or If the ma.jar par-
tlan aC the program Is a.ccampllshed thraugh
prlva.te market financing .or Federal laa.ns,
and the Federa.l a.sslsta.nce canstltutes a
mlnar partlan .of the pragra.m. When the re-
Imbursement method Is used, the Federal
spansarlng agency shall make payment
wlthln'thlrty days a.fter receipt .of the bllllng,
unless the billing Is Impraper.
6. When the letter-af-credlt pracedure 15
used, the recipient sha.1I be Issued .one can-
salldated letter-af-credlt whenever passlble
ta caver a.ntlclpa.ted ca.sh needs far all gra.nts
a.nd ather a.greements a.wa.rded by the spall-
sarlng a.gency. Likewise, to the extent possi-
ble, when th"e a.dva.nce by Treasury check
methad 15 used, adva.nces shauld be cun-
salll:la.ted (paaled) far all gra.nts a.nd ather
a.greements ma.de by the spansarlng agency
ta tha.t recipient. . ,
7. Unles3 .otherwise required by Ia.w, Fed-
era.l spansarlng agencies sha.1I nat wtthhold
pa.ym~nts far praper cha.rges made by recipi-
ents a.t a.ny time during the praject .or pro-
ltram perl ad unless (a) a recipient ha.s failed
ta camply with the pragram .objectives, award
candltlans. .or Federal repartlng require-
ments; .or (b) the recipient Is Indebted to
the United States, and callectlan .of the In-
debtedness will nat Impair accampllshment
.of the .objectives .of a praject .or pragram
sponsared by the United Sta.tes.
Under such candltlans, the sponsarlng
agency ma.y. upan rea.sanable natlce. Infarm
the recipient tha.t pa.yments will nat be made
fpr abllgatlans Incurred a.fter a. specified da.te
until the candltlans a.re carrected .or the In-
debtedness to the Federal Gavernment 15
IIqulda.ted.
ATTACHMENT J.--<:IRCULAR No. A-110
REVISION OF FINANCIAL PLANS
L This a.ttachment sets farth criteria. a.nd
pracedures ta be fallawed by Federa.l spon-
sarlng agencies In requiring recipients to re-
part 'devlatlans fram fina.ncla.1 pla.ns a.nd to
request a.ppravals far fina.nclal plan re-
vlslans. '
2. The fina.ncla.1 pla.n 15 the financia.l ex-
presslan of the praject .or pragram a.s a.p-
proved during the a.ppllca.tlan a.nd/Ol' Itwa.rd
pracess, It ma.y Include either the Federal a.nd
nan-Federa.l share, .or .only the Federal sha.re:
depending upan spansarlng agency require-
ments, It shauld be rela.ted ta perfarmance
Car progra.m eva.lua.tlan purpases whenever
appropriate a.nd required by the Federa.l
spansarlng a.gency,
3, Far nancanstructlan a.wa.rds, recipients
shall Immediately request approva.ls fram
Federal spansarlng agencies when there Is
re'lsan to believe tha.t within the next seven
da.ys a. revlslan will be necessa.ry far the
fallawlng rea.sans:
a.. Cha.nges In the scape .or the objectl,'e .of
the praject .or pragra.m.
b, The need Cor a.ddltlana.1 Federa.l fund-
Ing,
c' The tra.nsfer .of amaunts budgeted fcr
Indirect casts ta a.bsarb Increases Indirect
costs .or vice versa, It a.ppraval Is required
by the Federal sponsarlng agency.
d, The expenditures as require apprava.1 In
accordance with FMC 73~. "Cast Principles
far Educa.tlonal Instltutlans," Far all ather
a.wards. apprava.l requirements for ather
Items at expenditures ma.y be Imoased If they
are consistent with those In FMC 73~. Na
ather requirements Car specific Items ma.y be
J
Office of Management and Budget Circular A.110 (7/30/76)
Imposed unless a devIatIon has been ap-
proved by the Omce ot Management and
Budget.
e. RecIpIents plan to transfer tunds allotted
ror trainIng allowances (direct payments to
trainees) to other co. tegorles ot expense.
4. None ot the substantive programmatIC
work under a grant or other agreement may
be subcontracted or transferred without prIor
approval or the Federal sponsorIng agency.
This provisIon does not apply to the purcbase
ot supplies, materIal, equipment, or general
support services.
5. The Federal sponsortng agency may
also, at Its option, restrIct transrers ot runds
a.mong direct. cost ca.tegartes ror awa.rds In
whlcb the Federal share exceeds $100,000
when the cumula.tlve &.mount or such trans-
rers exceeds or Is expected to exceed tlve
per~nt or the total budget as last approved
by the sponsoring agency. The same criteria
shall apply to tbe cumula.tlve a.mount or
transrers among progra.ms, runctlons, &nd
aotlvltles wben budgeted separately tor an
award, except that tbe Federal sponsortng
agency shall permLt no transrer that would
cause any Federal approprla.t1on, or part
thereor, to be used ror purposes otber than
those Intended.
6. All other changes to nonconstructlon
budgets, except ror tbe cbanges described
In paragraph 8, below, do not requIre ap-
provaL This Includes tbe use or recipient
runds In rurtherlUlce or program objectives
over and above the recipient minimum sbare
Included In the a.pproved budget.
7. For construction awards, recipients
shall request prior approvals promptly rrom
Federal sponsoring agencIes ror budgetre-
visions wherever:
B. The revisIon results rrom changes In
the scope or the objective or tbe project or
program, s.nd
b. The revisIon Increases tbe budget
amounts Or Federal runds needed to com-
plete the project.
8. When a Federal sponsoring agency
makes an award that provIdes support, ror
both construction and nonconstructlon work,
the Federal sponsoring agency may require
the recipient to request prior approval rrom
the Federal sponsoring agency before m:ll<lng
any rund or budget tn>nsrers between the
two types or work supported.
9. For both construction and nonconstruc-
tlon awards, Federal sponsoring agencies
shAll require recipIents to notlry the Fed-
eral sp:msorlng agency promptly whenever
the amount or Federalautborlzed runds IS
expected to exceed the needs or the recipient
by more than '5,000 or five percent or tbe
Federal award, whIchever Is greater. This
notification wUl not be required If applica-
tions lor addl tlonal runding are submltte:1
ror contlnulng grants or contracts.
10. When requestIng approval ror budget
revisIons. recipients shall, Use the budget
ronns that were used In tbe application
unless a letter request w!ll sumce.
11. WIthin 30 calendar days from the da.te
or receipt or the request ror budget revI-
sions, Federal sponsoring agencIes shall re-
view the request and notlly tbe recIpient
whether the budget revIsIons have been ap-
proved, U the revision Is stlll under con-
sideration at the end or 30 calend:u days.
the Federal sponsortng agency shall lnlorm
the reclplent In wrltlng or the date when tbe
recipIent may expect the decision.
ATTACHMENT K.-CIRCUW No. A-1I0
CLOSEOUT PROCEDURES
L This attachment prescrtbes unltorm
closeout procedures lor Federal grants and
other agreements with recipients.
2. The rollowlng definltlons sball apply ror
the purp06e or this attacbment:
a. C/oseout.-The closeout ot a grant
agreement Is the procetl8 by which a Federal
sponsorIng agency determlnes that all ap-
plicable adm1plstratlve actions and all re-
quired work ot the agreement have been
completed by the recipient and the Federal
sponsoring agency.
b. Date 01 completlo1&.-The date ot com-
pletion Is the date on which all work under
grants and other agreements Is completed or
the date on l.he award. document. or any
, supplement or a.menc1ment thereto, on wblcb
Federal sponsorship ends.
c. DufJllowed co.tu.-DlsaIlowed costs a.re
those charges to a grant or otber agreement
that the Federal sponsorJ.ng agency or Its
representative determines to be unallow-
able. In accordance with the applicable Fed-
eral cost prInciples or other condItions con-
tained In tbe agreements.
3. All Federal sponsoring agencies shall es-
tabllsb closeout procedures tbat Include tbe
rollowlng requirements:
a. Upon request, the Federal sponsoring
agency shall make prompt payments to a
recIpient tor allowable reimbursable costs
under the grant or other agreement being
closed out.
b. The recipient shall immediately rerund
any balance ot unobligated (unencumbered)
cssb that tbe Federal sponsortng agency has
advanced or paId and that Is not autborlzed
to be retained by tbe recipient ror use In
other grants or other agreements.
c. The Federal sponsoring agency sball ob-
taln rrom the recipient wltbln 90 calendar
days arter tbe date at completion or tbe
agreement all tlnanclal, perrormance. and
otber reports required as tbe condition or the
agreement. The agency may grant extensions
wben requested by the recipient.
d. When authorized by the grant or other
agreement. the Federal sponsoring agency
sball make a settlement ror any upward or
downward adjustments to tbe Federal sbare
oC costs aCter these reports a.re received.
e. The recIpient sh.all account ror any prop-
erty acqUIred wltb Federal runds. or re-
ceived rrom tbe Government In accordance
with the provisions ot Attachment N to this
Circular, Property Management Standa.rds.
r. In the event a final audit has not been
performed prior to tbe closeout or the grant
or other agreement. the Federal sponsoring
lLgency sball retaIn tbe right to recover an
approprtate a.mount atter tully considerIng
tbe recommendations on disallowed costs re-
sulting rrom tbe tlnal audit.
4. SuspensIon and termination procedures
are contained In Attachment L to tbls Cir-
cular.
ATrACHMENT L.-CIBCULAa No. A-1l0
SUSPENSION AND TERMINATION PIlOCEDU'IlES
1. This attachment prescrtbes uniform
suspension and termination procedures for
Federal grants and otber agreements wltb
recipIents.
2. The rollowlng definitions sball apply
rcr the purpcse or tbls attachment:
a. Termi1lfJti01l.-The termination or a
grant or otber agreement means tbe ClUl-
cellatlon or Federal sponsorship. in whole or
In part. under an agreement at any time
prtor to the date or completion.
b. Su.spen.tion.-The suspension or a grant
or other agreement Is an action by a Federal
sponsoring agency tbat temporarily sus-
pends Federal spons:>rsblp under the grant
or other agreeptent. pending corrective ac-
tion by tbe recipient or pending a decision
to terminate the grant or other agreement
by the Federal sponsoring agency.
;3. All Federal sponsoring agencies shall
provIde procedures to be rollowed when a
recipient has railed to comply with the terms
I
A.110:15
ot the grant or other agreement and condi-
tions or standards. When that occurs, the
Federal sponsorIng agency may, on reason-
able notice to the recipient, suspe"d the
grant or other agreement, and withhold lur-
ther payments, prohIbit the recipIent trom
Incurring addItional obligations or runds,
pending corrective action by the recipient, or
a decision to termInation In accords.nce with
paragraph 4. The Federal sponsoring agency
shall allow all necessary and 'proper costs
tha.t tbe recIpIent could not reasonably avoid
during the perIod ot suspension provided that
they meet the provisions or the llppllcable
Federal cost principles.
4. Federal sponsoring agencies shall pro-
vide tor the systematic settlement or ter-
minated grants or other agreements Includ-
Ing tbe tollowlng:
a. Termination tor cause.-The Federal
sponsoring agency triay reserve the right to
terminate any grant or other agreement In
wbole or In part at any time berore the date
ot completion, whenever It Is determined that
the recipient has railed to comply with the
condItions at the agreement. The Federal
sponsoring agency shall promptly notl!y the
recipient In writing or the determination and
tbe reasons ror the termination, together
wltb the effective date. Payments made to
recipients or recoveries by the Federlll spon-
soring agencies under grants or other agree-
ments terminated ror cause shaH be In ac-
cordance with the legal rights and lIabllltles
ot the parties.
b. Termination lor convenience.-The Fed-
eral sponsoring agency or recipIent may ter-
minate grants and other llgreements In whole
or In part when both parties agree that the
continuation or the project would not pro-
duce benellclal results commensurate with
tbe rurther expenditure or runds. The two
parties shall agree upon the termination con-
dItions, Including the effective date and, in
the case at partial terminations, the portion
to be terminated. The recipient shaH not
Incur new obligations ror the terminated por-
tion alter the effective date. and shall can-
cel as many outstanding obligations as pos-
sible. The Federal sponsoring agency shall
aHow rull credit to the recipient for the
Federal share at the noncanceHable obliga-
tions, properly Incurred by the recipient prior
to termination.
ATrACHMENT M.-CIItCULAR No. A-IIO
STANDARD FORM FOR. APPLYING FOR
FEDERAL ASSISTANCE
L This attachment promulg",tes a stand-
ard rorm (SF 424) to be used by pul:lllc and
'private InstltutlonlS or hIgher educatlon,
public and private hospitals and other quasl-
public llnd private nonprotlt organizations as
a race sheet for applications when applyIng
ror Federal grants under programs covered
by Part I, Attachment A, OI\IB Crlcular No,
A-95. In addition, agencies are particularly
encouraged to etxend the use of SF 424 to
common programs WIth State and local gov-
ernments where this rorm Is now required by
FMC 74-7,
2. The SF 424 may also be used. on an op-
tional basis, to rultlll the requirements or
OMB Circular A-95 ror II notltlcatlon of In-
tent, rrom applicant to clearinghouses. that
Federal assistance wlH be applled ror, Local
or State clearinghouse procedures wUI govern
the use or the lorm ror this purpose,
3. The standard rorm wl1l slso be used hy
Federal agencies to report to the clearlng-
bouses on major actions taken on appllcll-
tlons reviewed by clearinghouses In accord-
ance wIth OMB Circular A-95, and to notify
States or grants-In-aid awarded In accord-
llnce with Treasury Circular 1082.
J
I
Office of Management and Budget CIrcular A-110 (7130/76)
A-110:16
FEDERAL ASSISTANCE z. APPLI. .. IlVtIII€R 3. STAn: .. flUMlIt:R
CANT'S AI"PU~
1, TYPE nON
o PREAl'PLICATlON Appt,1- _. Itm IDIN'R- _. DATI r..... _t4 ilia"
Of eAT"'" r_ - ... I'IU
ACTION o N'PlJeAnotl 19 0\331GN[I) 19
(Itf_ep. o NcmFlCA'MON Of 1N11Jff (Opt.) L.alH
er-- D REPORT 01' FEDERAl. AtT10ft Bra...
4. lEGAL APPLICANT/RECIPIENT 5. fEDeRAl ~LOYEA IOEHTII'lCA TION NO.
I. ~lIcont N.... :
_. Or,.nilltion Unit : 6. I I I- I I I I
.. 5trHl/P.O. Iloll : PRO. .. NUIIBER
d. City L ....n17 GRAM b. TInE
: :
(F'rO'ffl&
f. SIIto : .' ZIP Code: ".ural
h. Co.loot P....... tNa_ C,""""",
i " ....,,"- No.) :
7, TITLE ANO OESCRIPTION Of APPlICANr, PROJECT B. TYpt Ol' JlPPt.ICANTfltECIPIENT
5 ......$toto ~..unllJ Actl.. ~
8-1_11 . t I~d~::' T~d=-tlon" tMtIlulion
i C-Subllall
01_ ~. (SJHrlfIlI:
D-Counly
E-Clty ,
R f- SdlooI DI_
~ ~~"'- B..- e~."....." "'cUr 0
" TYpt Ql' ASSISTANCI
A.4a1. C....l ~-
i B-I\I1IIIh__ ..01 ~hor ."tnll""""" rn
I-UoI ".;..c. klCUr(I)
10. AREA Of PAOJIlCT IMPAt:T (Ns,".. of _. .--. 11, E~F 12. TYPI 01 Al'f'LteATlON
S....... ....) BER HI ......,.... C-Rwllhtto l-""a_lotl..
B2I4 TIN _.._1 D-ContlnUlII.. E"tft" .pP"'opriot. I.U.-r n
U. PI'IOfflSED fUr+DINQ 14. CONGRIStfoNAl D1STRIC'R Of: 15. TYPE Of CHANCe: (T,... 11._ 1..)
S .. API'UOAl'lf II. ,MlII8t ......1........ Dell." F-OllMr (Sp.elf,,):
. . F1!/)[R"l . lIB ~ocr_ Doll.n
C-I....... Du....!llII
b. APPliCANT .08 8-0-.... DONU"
II. ~JECT START )J, ~JECT I-Cucoll.tt..
c. STATE .00 1M I: Y.... -u. ..... DURATION ."e.,.,. appro- ITTI
d. lOc..L .00 1t II-no. """" kill.. (.)
.. OTHER .00 lL t:SYtMATlR,-DAT1i: TO ~ ........... 014" 19. EXISTING fEDERAL IDENTIFICATION NtJIotBER
BI SU&MI ED TO
t. TOT~ S .00 fIDERAI. AGENCY ~ 19
20. FEDERAL AGENCY TO RECEIVE REQUEST ,""- c-.. 6-. 1111' ~ 21. REMARKS ADDED
[l V.. 0 No
! 22. I. To th. 'beot ef "'1 knowlod.. Ind Mllef. _. If 't lor 6MB Clrcul... ......" _ .""10011010 _ _Iltod. pu""..l 10 in, N~ ,...~ R .........
dltl i,. Chi. _,liClU.../.ppll..ll.... .,. atntct VI.....,.. tD IWrG9,iltl I...'hll...... I"d Iff ,.po..... I,.. Itbc:htd: ..,..,... aCkeA.cl
i THE trUI Iltd corrMt. 1M ....."'.., hH "'"
APPLICANT ....lr .uthori,od lor .... ..-..i., bodr of 0 0
~ CEJ'lT 11'1 ES ltI. Ipplicont ... 1M .pplicont wiN .... III
THAT ~ wtllt 1M ._ __ 1/ 1M ....... ClIt 0 0
1 In.. .. Ip~. (3) 0 0
.
23. c. TYPID _ ANO TIT\[ L IS'MATURE L DATE SICIItfD ""
! CERTIFYING Y...r ...0tItA d4w -
i REPRti:. I'
SENTATlVE
204, M1~CY NN.tI 25. APPLICA' r_ -- ...w
TlON
RECEIVED 19
26. ORGANIZAT~ UNIT *1. AOMINIST~TIVE OffiCE 2L fEDERAL APPLICATION
I IDENTIfiCATION
29. ADORE" 10. FEDEMl ORANT
I IO~TIFICATION
I ]1, ACTION TAKEN ~z. FUH01M ,,- _110 ..... 204. raer ........... .."
.,. ARTIMG
I o .. AWMOEO I. PlDlIIAL $ .00 J3. ACTION DATI: ~ 19 DATE 19
o _. RtJICTIO _. ""!'ltCNIl' .00 IL ~TM:T FOIl AOOtTIO.....l IH,.OttMA. 36- r.- ...0tItA .."
~ ION (Ne_ ...., ....~ _.......) ENDING
o I. Il[TURNIO I'OR .. SlAT( .00 DATE 19
AM E/lOMl!IfI' 4. low. .00 37. REMARKS ADDED
! o 4. DEfIlUIl!O .. Oftlttl .00
5 o .. wtlllDIlAWIl .00 o Y" ONo
I f. lO'IllL $
38. .. In IHI., _ _. I., __ .-.... .... .....in~ __ _. _. ftIlERAI. ACOICY ......" Df'fIClAI.
aid.,.. If .~ II .... NIl. ~ '" PIll 1. 0 B Cl......... _. INe..... e"d ~ .....)
fl!OERAl AGENCY It .... _ It It _.
1\-95 ACnON
OMB Appro...' No. 29-ftOtl1
aTAHOARO PORM 424 PAGe: 1 00-111
~ .. o.A. ,..... M__ Clr..... 7~7
I ,
Office of Management and Budget Circular A-110 (7130/76) A-110:17
SECTlOH IV-REMARKS (PIBtJiI. r.fBrenu th. proper ium !lumber from Seetio-M 1,11 or III, if applieGble)
"
STANDARD FORM 424 PAGE 2 (10-75)
I
,
Office of Management and Budget Circular A-110 (7/30/76)
A-110:18
GENERAL INSTRUCTIONS
This is a multi.purpose standard fonn. First, it will be used by applicants as a required facesheet for pre.
applications and applications submitted in accordance with Federal Management Circular 74-7. Second. it will
be used by Federal agencies to report to Clearinghouses on major actions taken on applications reviewed by
clearinghouses in accordance with OMS Circular A-95. Third, it will be used by Federal agencies to notify
States of grants.in.aid awarded in accordance with Treasury Circular ,1082. Fourth, it may be used. on an
optional basis. as a notification of intent from applicants to clearinghouses, as an early initial notice that Federal
assistance is to be applied for (clearinghouse procedures will govern).
APPUCANT PROCEDURES FOR SECTlOfI I
Applicant will complete all items in Section I, If an item is not applicable, write "NA". If additional space is needed, insert
an asterisk ...... and use the remarks section on the beck of the fonn. An explanation follows for each item:
Item
2a.
2b,
1.
Mark appropriate box. Pre-apptlcatiqn and appllca.
tion guidance is in FMC 74-7 and Federal agency
pl'Oflram instructions. Notlftcoltion of intent RUid.
ance is in Circular A-95 procedures from clear.
inghouse, Applicant will not use "Report of Federal
Action" bolt,
3a.
Applicant's own control number, If dltslred.
Date Sec:tIon lis PnlP8red.
Number assigned by State cleeril18house, or If dele-
gated by State, by areawide clearinghouse. All 111-
quests to Federal agencies must contain this ldentl.
fier if the Dr'Ogram is COYered by Circular A-95 and
required by applicable State/areawide clearing-
house procedures. If in doubt, consult your peer.
inghouse.
3b.
4&-4h.
Date applicant notified of c1~ringhouse Identifier.
~al name of appllcant/reclplent, name of primary
organizational unit which will undertake the assist-
ance activity, complete addnlSS of applicant. and
name and tOlephone number of person who can pr0-
vide further infonnetion about this request.
Employer identification number of applicant as as-
signed by Internal Revenue ServIce..
Use Catalog of Federal Domestic Assistance num-
ber assigned to program under which assistance is
requested. If mOnl than one program (e.g., joint.
funding) write "multiple" and eltplain in remarks.
If unknown, cite Public Law or U.s. Code.
Program tttJe from Federal Catalog. Abbreviate If
necessary.
Brief title and appropriate description of project.
For notification of intent, continue In remerks sec.
tion if necessary to convey proper description.
Mostly self-eltplanatory. "City" Includes town, town-
Ship or other municipality.
Check the type(s) of assistance requested. The
definitions of the tenns are:
A. Basic Grant. An Original request for Federal
funds. This would not include any contribution
provided under a supplemental grant.
8. Supplemental Grant. A request to Increase a
basic grant in certain cases where the eligible
applicant cannot. supply the required matchll18
share of the basic Federal program (e.g., grants
awarded by the I\ppalachlan Regional Commis-
sion to provide the applicant a matching share).
C. lOlln. Self explanatory. .
5,
68.
6b.
7.
8.
9.
Item
10.
D. IlI5Urance. Setf elq)lanatory.
E. Other_ EllpIein on ren18rks page.
Gowmmental' unit where lIignlflcant and meaning-
ful impact could be observed. list only largest unit
or units a~, such as StBte, county, or city, If
antinl unit affected. list it rather than subunits.
Estin1eted number of persons direc:tfy benafitlng
from project.
Use appropriate code letter. Definitions are:
A. New. A submittal for the first time for a new
PRJject.
B. Renewal. An extension for an addftlonal funding/
budget period for a project having no projected
completion date, but for which Federal suj)pOrt
must be renewed each year.
C. ~. A modlflcatlon to project nature or
scope whict1 may result 1ft fundil18 change (in-
~ or dec:nlase).
O. Continuetion. An 8lltenslon for an additional
fundll18Ibudget period for a pro~ the agency
initially agreed to fund for a definite number of
yeen.
E. Augn....,botluil_ A requirement for additional
funds for a profect previously awarded funds in
the seme funding/budset period. Project nature
and scope unchal18ed.
Amount requested or to be contributed during ,the
first funding/budget period by each contribut~r.
Value of in-kind contributions Will be Included. If
the action Is a change In dollar amount of an eltist-
ing grant (a revision or augmentation). indicate
only the amount of the change. For decreases en.
cJose the amount in parentheses. If both basic and
a1ppitlfMntal amounts are included, breakout in
remlirb. For multiple prtl8ram funding, use totals
and show program breakouts in remarks. Item defi.
nitions: 13a. amount requested from Federal Gov.
ernment; 13b, amount applicant will contribute:
13c. amount from State. if applicant is not a State;
IJd, amount from local government, if applicant is
not a local government; 13e, amount from any other
sources. eltplain in remarils.
11,
12.
13.
148.
14b_
Seff uplanatory.
The dlstrict(sl where most of a<:Nal work will be
accomplished. If city-wide or Stabt-wide, covering
several districts, write ..city-wide" or "State.wide."
Complete only for revisions Otem 12c). or augmen-
tations (item 12e).
15.
STANDIUU> FORM 424 PAGE 3 (10-75)
I
I
Office of Management and Budget Circular A-110 (7/30/76)
A-110:19
'tern
16.
17.
18.
Approximate date project expected to begin (usually
associated with estimated date of availability of
funding).
Estimated number of months to complete project
after Federal funds are available.
Estimated date pl'88ppllcatlon/appllcatlon will be
lubmitted to Federal agency If this project requires
clearlnlhouse review. If review not required, this
date would usually be same al date in Item 2b.
'tern
19.
Existing Federal Identification number If this II not
a new request and directly relates to a previous
Federal action. Otherwisa write "NA".
Indicate Federal agency to which this request Is
addressed, Street address not required, but do use
ZIP.
Check appropriate box as to whether Section IV of
form contains remarks and/or additional remarks
are attached.
20.
21.,
APPUCANT PROCEDURES FOR SECTION II
Ust clll8ringhouses to which submitted and Ihow
in appropriate blocks the status of their responsas.
For more than three clearinghouses, continue In
remarks section, All written comments submitted
by or through clearinghouses must be attached,
Name and title of authorized representative of lagal
applicant.
Applicants will always complete items 23a, 23b, and 23c. If clearinghouse review Is required, Item 22b must be fully com.
p1eted. An explanation follows for each item:
'tern
23b. Self explanatory.
23c. Self explanatory.
Note: Applicant completes only Sections I and II. Section
III is completed by Federal agencies.
FEDERAL AGENCY PROCEDURES FOR SECTION III
If appUcant-supplied information in Sections I and II needs no updating or adjustment to fit the final Federal action, the
Federal egency will complete Section III only. An explanation. for each Item follows:
Item
24.
25.
26.
Executive department or independent agency ha"lng
program admlnistra~lon responllbility,
Self explanatory.
Primary organizational unit below department level
having direct program management responsibility,
Of7ica directly monitoring the program,
Use to identify non.award actions where Federal
grant Identifier In item 30 Is not applicable or will
not suffice.
Complete address of administering ofllce shown In
item 26,
Use, to identify award actions where dltrerent from
Federal application Identifier In item 28,
Self explanatory. Use remarks section to amplify
where appropriate.
Amount to be contributed during the first funding/
budget period by each contributor. Value of in.kind
contributions will be included. If the action is a
change in dollar amount of an existinl grant (a revi.
sion or augmentation), indicate only the amount of
change. For decreases, enclose the amount in pa.
rentheses. It both basic and supplemental amounts
are included, breakout In remarks. For multiple pro-
gram funding, use totals and show program break.
outs in remarks. Item definitions: 32a, amount
awarded by Federal Government; 32b, amount ap-
plicant will contribute; 32c, amount from State, if
applicant is not a State; 32d, amount from local
government if'applicant is not a local government;
32e, amount from any othtlf' sources, explain in
remarks.
Dete action was taken on this request,
Date funds will become available.
Item
22b.
23a,
27.
28.
29.
30,
31.
32.
33.
34.
'tern
35.
Name and telephone no. of agency person who can
provide more information regarding this assistance.
Date after which funds will no longer be available.
Check appropriate box as to whether Section IV 01
form contains Federal remarks and/or attachment
of additional remarks.
For use with A-95 action notices only. Name and
telephone of paBon who can assure that appropri.
ate A-95 action has been taken--If same as person
shown in Item 35, write "same". If not applicable,
write "NA".
36,
37.
38.
Federal Agency Procedures-special consi~erations
A. Treasury Circular 1082 compliance. Fetteral agency will
assure proper completion of Sections I and III. If Sectiol1 I
is being completed by Federal agency, all applicable items
must be filled in. Addresses of State Information Recep-
tion Agencies (SCIR;,s) are provided by Treasury Depart.
ment to each agency. This form replaces SF 240, which
will no longer be used.
S. OMS Circu'ar A-95 compliance. Fedeflll agency will as.
sure proper completion of Sections I, II, and III. This form
is required for notifying all reviewing clearinghouses of
major actions on all programs reviewed under A-95.
Addresses of State and areawide clearinghouses are pro.
vided by OMB to each agency. Substantive differences
between applicant's reqllest and/or clearinghouse recom.
mendations, and the project as finally awarded will be
explained in A-95 notifications to clearinghouses.
C. Special note. In most, but not all States, the A-95 State
clearinghouse and the (TC 1082) SCIRA are the same
office. In such cases, the A-95 award notice to the StaM
clearinghouse will fulfill the TC 1082 award notice reo
Quirement to the State SCIRA. Duplicate notification
should be avoided. '
STANDARD FORM 424 PAGE 4 (10-75)
6 GPO ,qB () _ 2'O."~o; 134-11
I
Office of Management and Budget Circular A.110 (7/30/76)
ATTACHMENT N.--CmCULAR No. A-110
PROPERTY MANAGEMENT STANDARDS
1. ThIs attachment prescribes un1form
standards governing management of prop-
erty furrushed by the Federal Government or
whose cost was charged to a project sup-
ported by a Federal gra.nt or other 'agreement.
Federal sponsoring agencies shall require re-
cipients to observe these standards under
grants and other agreements and shall not
Impose additIonal requIrements unless spe-
clllcally requIred by Federal law. The recipI-
ent may use Its own property man(l.gement
standards and procedures provided It observes
the provisions ot this attachment. This at-
tachment also applies to subreclplents as
referred to In paragraph 5 ot the basic cir-
cular.
2. The tollowlng definitions apply for the
purpose of this attachment:
a. Real property.-JReal property means
land, including land Improvements, struc-
tures and appurtenances thereto, but ex-
cluding movable maChinery and equipment.
b. Personal property.-Personal property
of any kind except real property. It may be
tangible-having physical existence, or intan-
gible-having no physical existence, such as
patents, Inventions and copyrights.
c. Nonexpendable personal property.-Non-
expendable personal property means tangible
personal property having a usetul lite of
more than one year and an acquisition cost
ot $300 or more per unit exempt that recip-
Ients subject to Cost Accounting Standards
Board regulations may use the CASB stand-
ard ot $500 per unit and useful Itfe of two
years. A recipient may use Its own definition
of nonexpendable personal property provided
that the definition would at least Include all
tangible personal property as defined above.
d. Expendable personal property.-Expend-
able personal property refers to all tangible
personal property other than nonexpendable
property.
e. Excess property.-Excess property means
property under the control of any Federal
agency that, as determined by the head
thereot, Is no longer required for Its needs
or the discharge ot Its re.;;ponslbllltles.
f. Acquisition cost 01 purchased nonex-
pendable personal property.-Acqulsltlon cost
ot an Item of purchased nonexpendable per-
sonal property means the net Invoice unit
price ot the property including the cost of
modifications. attachments, accessories, or
auxUlary apparatus necessary to make the
property usable tor the purpose for whIch It
was acquired. Other charges such as the cost
of Installation, transportation, taxes, duty
or protective In-transit In6urance, shall be
Included.or excluded from the unit acquJsI-
tlon cost In accordance with the reciplent.s
regular accounting practices.
g. Exempt property.-Exempt property
means tangible personal property acquired In
whole or In 'part with Federal tunds. and
title to which Is vested In the recipient with-
out further obligation to the Federal Govern-
ment except as provided In subparagraph 60.
below. Such unconditional vestIng of title
wUl be pursuant to any Federal legislation
that provides the Federal sponsorln~ agency
with adequate authority.
3. Real property.-Each Federal sponsoring
agency shall prescribe requirements for re-
cipients concerning the use and disposition
ot real property acq ulred partly or wholly
under grants or other agreements. Unless
otherwise prOvided by statute. such require-
ments. as a minimum. shall Nlntaln tbe
following:
a. Ti tie to real property shall ves t In the
recipient subject to the condition that the
recipient shall use the real property for the
authorized purpose ot the proJect.'as long as
It Is needed.
b. The recipient shall obtain approval by
the Federal sponsoring agency for the use of
real property In other projects when the re-
cipient determines that the property Is no
longer needed for the purpose of the original
project. Use In other projects shall be limited
to those under other federally sponsored proJ-
ects (I.e.. grants or other agreements) or pro-
grams that have purposes consistent with
those authorized for support by the Federal
sponsoring "trency.
c. When the real property Is no longer
needed as provided In a and b above, the
recipient shall request disposition Instruc-
tions from the Federal sponsoring agency or
Its ~uccessor Federal sponsoring agency. The
Federal sponsoring agency shall observe the
follOWing rules In the disposition Instruc-
tions:
(I) The recipIent may be permitted to re-
tain title atter It compensates the Federal
Government In an amount computed by ap-
plying the Federal percentage ot participa-
tion In the cost of the original project to the
faIr market value of the property.
(2) The recipient may be directed to sell
the property under guidelines provided by
the Federal sponsoring agency and pay the
Fe:1eral Government an amount computed
by applying the Federal percentage of par-
ticipation In the cost of the original project
to the proceeds from sale (atter deducting
actual and reasonable selling and nx-up eJ:-
penses, If any, trom the sales proceeds).
When the recipient Is authorized or required
to sell the property, proper sales procedures
shall be established that provide for competi-
tion to the extent practicable and result In
the highest possible return.
(3) The recipient may be directed to trans-
fer title to the property to the Federal Gov-
ernment provided that In such cases the
recipient shall be entitled to compensation
computed by applying the recipient's per-
centage of participation In the cost ot the
program or project to the current talr market
value of the property.
4. Federaly-owned nonexpendable persoTUlI
property.-Tltle to federally-owned property
remains vested In the Federal Government.
Recipients shall submit annually an Inven-
tory listing of federally-owned property In
their custody to the Federal sponsoring
agency. Upon completion of the agreement
or when the property Is no longer needed,
the recipient shall report the property to
the Federal sponsoring agency for further
agency utilization.
If the Federal sponsoring agency has no
further need tor the property, It shall be
declared excess and reported to the General
Services Admlnlstrtlon. Appropriate dlspolll-
tlon Instructions will be Issued to the re-
cipient after completion of the Federal
agency review.
5. Exempt propeTty.-When statutory au-
thority exists, (e.g., P.L. 85-934. 42 U..s.C.
1892) title to nonexpendable personal prop-
erty acquired with project funds, shall be
vested In the recipient upon acquisition un-
less It Is determined that to do so Is not In
furtherance of the objectives of the Federal
sponsoring agency. When title Is vested In
the recipient, the recipient shall have no
other obligation or accountability to the
Feder..1 Government for Its use or disposi-
tion except as provided In 6a below.
6. Other nonexpendable propeTty.-When
other nonexpendable tangible personal prop-
erty Is acquired by a recipient with project
funds. title shall not be taken by the Fe1-
eral Gon'rnment but shall vest In the re-
cipient subject to the follo,.,lng conditions:
a. Right to tra=ler title.-For Items of
nonexpendable per~onal property having a
unit acquisition cost of $1.000 or more, the
Federal sponsoring agency may reserve the
right to transfer the title to the Federal
,
A.110:20
Government or to a third party named by
the Federal Government when such third
party Is otherwise eligible under existing
statutes. Such reservation shall be subject to
the tollowlng standards:
(I) The property shall be appropriately
Identified In the grant or other agreement
or otherwise made known to the recipient
In writing.
(2) The Federal sponsoring agency shall
Issue disposition Instructions within 120 cal-
endlU' days after the end of the Federal sup-
port of the project for which It was acquired,
If the Federal sponsoring agency talls to Issue
disposition Instructions within the 120 cal-
endar day period, the recipient shall apply
the standards of subparagraphs 6b and 6c
as appropriate.
(3) When the Federal sponsoring agency
exercises Its right to take title, the personal
property shall be subject to the provisions
tor tederally-owned nonexpendable property
discussed In paragraph 4, above.
(4) WheJl title Is transferred either to the
Federal Government or to a third party the
provisions of subparagraph 6c(2} (b) should
be followed.
b. Use 01 other tangible nonexpendable
property lor which the recipient h/13 title.
(1) The recipient shall use the property
In the project or program for Which It was
acquired as -long as needed. whether or not
the project or program continues to be sup-
ported by Federal funds. When no longer
needed for the original pro~t or program,
the recipient shall use the property In con-
nection with Its other federally IIponsored
actiVities, In the following order of priority:
(a) Activities, In the following order of
priority:
(b) Activities sponsored by other Federal
agencl"".
(2) Shared u.!e.-During the time that
nonexempt nonexpendable personal proper-
ty Is held for use on the project or program
for which It was acquired, the recipient
sball make It avallable for use on other proJ-
ects, or programs It such other use will not
Interfere with the work on the project or
program for which the property was origi-
nally acquired. First preference for such
other use shall be given to other projects or
programs sponsored by ,the Federal agency
that nnanced the property: second prefer-
ence shall be given to projects or programs
sponsored by other Federal agencies. If the
property Is owned by the Federal. Govern-
ment, use on other activities not sponsored
by the Federal Government shall be per-
missible It authorized by the Federal agency.
U""r cbarges should be considered 11 appro-
priate.
c. Duposition 01 other nonexpendable
property.-When the recipient no longer
needs the property as provided In 6b above.
the property may be used for other actl71-
ties In accordance with the following stand-
ards:
(1) Nonexpendable property with a unit
acquisition cost 01 less than 11.000.-The re-
cipient may use the property for other activi-
ties without reimbursement to the Federal
Government or sell the property and re-
tain the proceeds.
(2) Nonexpendable peTsonal propcrty with
a unit acquisition cost 01 11.000 or morc,-
The recipient may retain the property tor
other uses provided that compensRtion Is
made to the original Federal sponsoring
agency or Its successor. The amount ot com-
pemoatlon shall be computed by applying
the pel'l"enlJl.ge 0( F't'deral plU'tlclp"tloll In
the cost of the original project or progrnm to
the current tair ITUU'ket value ot the property,
It the recipient has no need for the property
and the property has further use value. the
recipient shall request disposition Instruc-
tions from the original sponsoring agency.
I
Office of Management and Budget Circular A-110 (7/30176)
The Fede",1 sponsoring agency shall deter-
mine whether the property can be used to
meet the agency's requirements. Ir no re-
quirement exists within that agency, the
avallablllty at the property shall be report-
ed to the General Services Administration
by the Federal agen"y to determine whether 11
requirement tor the property exists In other
Federal agencies. The Federal sponsoring
agency shall Issue Instructions to the recipi-
ent no later than 120 days aHer the recipi-
ent's request and the tollowlng procedures
shall govern:
(a) Ir so Instructed or It disposition In-
structions are not Issued within 120 calen-
dar days arter the recipient's request, the
recipient shall sell the property and relm-,
burse the Federal sponsoring agency an
amount computed by applying to the sales
proceeds the percentage ot Federal partici-
pation In the cost ot the original project or
program. However, the recipient shall be
permitted to deduct and retain trom the Fed-
eral share UOO or ten percent at the pro-
ceeds, whlch..ver Is greater, tor the recipIent's
selling and handling expenses.
(b) It the reclplen t Ls Instructed to ship
the property elsewhere, the recipient shall
be reimbursed by the benefiting Federal
agency with an amount which Is computed
by applying the percentage at the recipient's
participation In the cost ot the original grant
project or program to the current talr market
value at the property, plus any reasonable
shipping or Interim storage costs Incured,
(c) Ir the recipient Is Instructed to other-
wise dispose at the property, the recipient
shall be reimbursed by the Federal sponsor-
Ing agency tor such costs Incurred In Its
dl~posltlon.
d. Property management standards lor
nonexpendable property,-The recipient's
property management standards tor nonex-
pendable personal property shall Include the
tollowlng procedural requIrements:
(I) Property records shall be maintained
accurately and shall Include:
(a) A descriptiOn at the property.
(b) Manutacturer's serial number, model
number. Federal stock number, national
stook number, or other IdentUlcatlon num-
ber.
(c) Source o( the property, Including
grant or other agreement number.
(d) Whether title vests In the recipient or
the Federal GOve.rnment.
'(e) Acquisition date (or date received, It
the property Was turnlshed by the Federal
Government) and cost.
(t) Percentage (at the end at the budget
year) ot Federal participation In the cost ot
the project or program tor which the prop-
erty was acquired. (Not applicable to prop-
...ty turnlshed by the Federal Government.)
(g) Location, use and condition ot the
property and the date the Intormatlon was
reported.
(h) Unit acqulaltlon cost.
(I) Ultimate disposition data, Including
date ot dIsposal and sales price or the method
used to determIne current talr market value
where a recipIent compensates the Federal
Iponlorlng llgency tor Its share
(2) Property owned by the Federal Gov-
ernment mlat be marked to Indicate Fed-
eral ownershIp.
(3) A physical Inventory ot property shall
be taken and the results reconciled with the
property records at least once every two
years. Any dllTerencu between quantities de-
termined by the physical Inspection and
those shown In the accounting records shall
be Inyestlgated to determine the causes ot
the dltference, The recipient shall, In connec-
tion with the Inventory, ver!!y the existence.
current utilization, and continued need (or
the property.
(4) A control system shall be In etfltCt to
Inaure adequate sareguards to prevent Iou.
damage, or thett of the property. Any 10....
damage, or theft at nonexpendable property
shall be Investigated and fully documented;
If the property was owned by the Federal
Government, the recipient shall promptly no-
tlty the Federal sponsoring agency.
(5) Adequately maintenance procedures
shall be Implemented to keep the property
In good condition.
(6) Where the recIpient Is authorized or
required to sell the property. proper sales
procedures shall be established which would
provide for competition to the extent practi-
cable and result In the hIghest possible re-
turn.
7. Expendable personal property.-Tltle to
expendable personal property shall vest In
the recipient upon acquisition. If there Is a
residual Inventory of such property exceeding
$1,000 In total aggregate talr market value,
upon termination or completion of the grant
or other agreement, and the property Is not
needed for any other federally sponsored
project or program. the recipient shall retain
the property (or use on nontederally spon-
sored activities, or sell It, but must In eltlTer
case, compensate the Federal Government
tor Its share. The amount of compensation
shall be computed In the same manner as
nonexpendable personal property.
8. Intangible property.
a. Inventions and patents.-If any program
produces patentable Items. patent rlght..,
processes. or Inventions, In the course of
work sponsored by the Federal GoYernment.
such fact shall be promptly and fully report-
ed to the Federal sponsoring agency, Unle98
there Is a prior ILgreement between the re-
cIpient and the Federal sponsoring agency
on disposition of such Items. the Federal
sponsoring agency shall determine whether
protection on the Invention or discovery shall
be sought. The Federal sponsoring agency
will also determIne how the rights In the In-
vention or discovery-Including rIghts under
any patent 1'IIfUed thereon~hall be allocated
and administered In order to protect the pub-
lic Interest consistent with "Government
Patent Policy" (President's Memorandum
for Heads of Executlye Departments and
Agenclea, August :J3, 1971, and statement of
Government Patent Polley as printed In 36
F.R. l6889).
b. Copyrights,-Except 88 otherwise pro-
vided In the terms and conditions o( the
agreement, the author or the recipient organ-
Ization Is free to copyright any books, pub-
llcatlons, or other eopyrlghtable maurl&ls
developed In the course at or under a Ped-
eral agreement, but the Pederal spoll.8Orlng
agency shall reserve a royalty-tree, nonex-
clusive and Irrevocable rIght to reproduce,
publish, or otherwise use, and to authorl..
others to use. the work (or Gonrnment pur-
poses.
ATTACHMENT O,--<::IJlCUUIl No. A-IIO
P1lOCt7ll_MZHT aT ANDAltD.
I. This attachment pro"ldes standards for
use by recipients In establlehlnr procedures
for the procurement at supplies, equipment,
construction and other lerYlc.. with Federlll
runds, Thele standards are furnished to en-
sure that such materlala and senlces are ob-
tained In an effective manner and In com-
pllance with the proYlllons of applicable Fed-
eral law and executive orders. No additional
procurement standards or requirements shall
be Imposed by the Federal sponsoring agen-
cies upon recipients unless Speclncally re-
quired by Federal statute or executive orders.
2, The standards contained In this, "ttach-
mant do not relieve the recipient at the con-
tractual ruponslbllltlu arising under Its
contrac\8, The recipient Is the responsible "u-
thorlty, without recoune to the Federal spon-
soring agency regarding the settlement and
satl.ltactlon of all oontractual and admlnl.l-
I
A-110:21
tratl"e Issues arising out of procurements
entered Into. In lupport of a grant or other
agreement. This In,,l.des disputes, claIms,
protests of award, lOUr... e"",luatlon or other
matters of a eontractual nature, Matters con-
cerning violation at law llre to be reterred to
s\lch local, State or Federal authority aa may
haTe proper 1UrI8dIeKon.
3. Recipients may.... their own procure-
ment pollclel and procedures, However, all re-
cipients shall &dhere to the standards set
torth In paragrILpha 3 and 4.
a. The recipient shILIl maintain a code or
standards of conduct thILt shall go"ern the
performance of 1\8 olIlcers, employees or
agents engaged In the ILwardlng and admin-
Istration of eont..acts using Federal funds,
No employee. omcer or agent shall participate
In the selection, award or administration of
a contrILct In which Federal funds are used.
where, to his knowledge. he or his Immediate
family. partners, or orga.nlzatlon In which he
or hIs Immedla.te family or partner has a
nnanelal Inte..est or with whom he Is nego-
tiating or haa any ..rrangement concerning
pro.pe"tI"e employment. The recipients. of-
ncers, employees or agents shill! nel ther .!Ollc-
It nor aocept gratuities, ravors or anything
ot monetllry value from contractors or poten-
tial contractors, Such standards shall provide
tor disciplinary actions to be ILpplled for vio-
lations or such standards by the recipients.
omcers, employees or agents.
b. All procurement vansactlons shall be
conducted In a man",", to provide, to the
maximum extent practical, open and free
competition. The recipient should be alert
to organizational contncts of Interest or non-
competl the practices llmong con tractore
that may restrict or eliminate C'Om4>etltlon
or otlb..r~ """tr&lft wilde, In order to en-
sure objecthe contractor perrormance and
eliminate un(aJr cOtnpetltlve advantage. con-
tracllOrs that develop or dr&tt 5peclficatlons.
requlre<nents, _ternenta of work, Invlta-
tlorus tor bids and/or requeets tor propoeals
should be excluded from competing tor such
prpcurements. Awardtl IIh&Ll be made to the
bl.dd.... /oll'eror whose bId/otrer Ls r""POnalve
to tbe Klllcltat-lon and Is meet advantageous
to the reelpknt, P<<'lce and other facoors con-
s1dere<1. Sollcltatioaa shell clearly set forth
aU requJrements that the bldder/oll'eror must
(u11lll In order for hlos l*1/o11'er to be eftlu-
ated by bhe recipient. Any and all bld3/otfers
may be rejeoted when It Is In the reolp1ent's
Inureat to do 80.
c. All reclplfl1ts lIhall ect6bllsh pT'OCUl'e-
ment procedures tbat proYId, for. at a mln-
Imum, the followl~ prooeduraJTequlrenumts,
(I) Proposed prOOUl'<<Jlen t actions shall
follow a proeedUf'e to _ure the avoidance
of purcnaslng unn~y or duplicative
ltelna. Where appropriate. an anal}"!lll5 shall
be m.&de ot Ie..... and pu..eh...... alteTno.t.lv...
00 deu..mine wh~h would be the most
eoonomical, practical pFoeuNlment.
(2) Sollcltlll.tlons tor !l'oode and services
Ihall be based upon a cle&r and accurate
deecnptlon ot 1ll\e tect&ntC1l1 requJrements
tCl" the mst<<"lal, prod_t or !len'lce to be
procured. Such a d_tptwn shaJl not. In
competltlYe pro<lunmen\8, contain t...eUrN
which unduly r...trlct com.peUtlon, "Brand
na.me or equal" descrlptlon.s ""'1 be used
as a means to dellne the performan.... or
other salle"t requlremenbl or a procurement,
and when so uM<! the speclnc reatures o( the
named brand ....hlch must be met by bldden/
olTer~rs shaJl be clee.rly opedlled.
(3) Posltln etforts shall be made by the
recipients to utlllze small buslnell8 &I'd mi-
nority-owned business sources or supolles
and senlces, Such etrona should a.llow theM
sources the maximum t....lble opportunity
to compete tor contracts utlllzlng Federal
funde.
(4) The type of pI'O('urlnp; lutrumenbl
used, e,g" IIxed price contracts. _t re1m-
I
Office of Management and Budget Circular A-110 (7/30/76)
burSlllble contracts, purchase orders, Incen-
tive contracts, shan be determined by the
recipient but must be appropriate fOt" the
partloular procurement and for promDtlng
the best Interest of the progralIl Involved.
The "cost-pltJ.>-a-percentage-<>f~t" meth-
od of contracting shan not be used.
(5) Contracts sh61 be made only WIth re-
sponsible contractors who po&se66 the po-
tentlonoJ ablnty to perform successfuny
under the terms "nd conditions of a pro-
posed procurement. Consldera.tlon shoJI be
given to such matters as contractor integrity.
record of past performance. flnancla.! and
tech n loa.l resources or acccs.>lblllty to other
neceSSArY resources.
(6) An proposed sole source contracts or
where only one bid or proposa.! Is received
In which the aggregn.te expenditure 13 ex-
pected to exceed $.5,000 shaH be subject to
prior approval at the dlscretl<m of the Fed-
era.! sponsoring agellcy.
(7) Some form of price or cost a.na.!ysls
should be made In connection with every
procurement action. Price IU111.Iys18 may be
accomplished In various waY3, Including the
comparison of price quotAtions submitted,
market prices and similar Indicia, together
with d1soounts. Cost analysis Is the review
and evaluation of each eleJTlent of cost to
determine roosonableness, alloca.blllty and
anowa.bUlty.
(8) Procurement records and flies for pur-
chases In excess of $lO,OOO s.han Include the
followllng :
(a) Basis for contractor selection;
(b) Justification for lack of competition
when comtpetltlve bids or offers are not
obtained;
(c) Basis for award C06t or price.
(9) A system for oontract admJnlstl1l.tlon
shan be maintained to ensure co{,ltractor
conformance with terms, conditions and
speclfica tlons of the con trn.ct, and to ensure
adeq U'8.U; and timely folloW'llp or oJI pur-
chases.
4. The recIpient shall Include, In addition
to provlelons to define a sound and complete
. agreement, the following proVIsions In an
contracts. These provisions shall also be ap:
plied to subcontracts.
a. Contracts In excess of $10,000 shall con-
tain contmctual proVIsions or condltlon3
that will anow for ad1n1nlstratlve, contrac-
l1ual or legal remedies In Instances In which
contra<:tors violate or breach contract tenns
and provide for such remedial actions ~
may be appropriate.
b. An contracts In exces.;; of $lO,OOO shan
conllaln suitable provisions for tennlna.tlon
by the recIpient Including the manner by
which termination WIll be effected and the
basis for settlement, In addition, such con-
tracts shall describe conditions under which
the oontract may be terminated for defa.ult
a.5 weU B.5 conditions where the contract may
be tel'mJnated bcca.use of olT'Cwnstances be-
yond the control of the contractor.
c. In a.1l contracts for construction or fa-
cility Improvement awarded for more than
$100,000, recipients shan observe the bond-
Ing requirements ixoVlded In Att.aclunent B
to this circular.
d, All contracts awarded by recipients and
their contra.ctor5 or subgrantees ha.vlng a
value of more than $10,000, sha.n conoo.ln a
provision requiring compliance with Execu-
tive Order 11246, entitled "Equal Employ-
ment Opportunity," as amended by Executive
Order 11375, and as supplemented In Depart-
men t of Labor regulations (<H CFR, Part 60) .
e. All contracts and subgrants In excess of
$2,000 for construction or repair awarded by
recipients and subreclplen,t.. shall Include a
provision for compliance with the Copeland
"Anti-Kick Back" Act (18 U.S,C, 874) as
supplemented In Department of Labor
regulations (29 CFR, Part 3). This Act pro-
vides that ea.ch contractor or subgrantee
shall be prohibited from Inducing, by any
means, any person employed In the construc-
tion, completion, or repair of public work, to
give up any part of the compensatlon to
which he Is otherwise entitled. The recipIent
shall report all suspected or reported viola-
tions to the Federal sponsoring agency,
f. When required by the Federal program
legislation, all construction contracts
awarded by the recipients and subreclplents
of more than $2,000 shall Include a provision
for compliance wIth the Davis-Bacon Act (40
U,S,C. 2760. to a-7) and as supplemented by
nepartment of Labor regulations (29 CFR,
Part 5), Under this Act contractors shall be
required to pay wages to laborers and me-
chanics at a rate not less than the minimum
wages specified In a wage determination made
by ,the Secretary of Labor. In addltlon, con-
tractors shall be required to pay wages not
less than once a week.. The recipient shall
place a copy of the curren t preval1lng wage
determination Issued by the Department of
Labor In each solicitation and the award
of a contract shall be condl.tloned upon the
acceptance of the wage determination, The
recipient shall report all suspected or re-
ported violations to the Federal sponsoring
agency,
g. Where applicable, all contracts awarded
by recipients In excess of $2,000 for construc-
tion con~racts and In excees of $2.500 for
other contracts that Involve the employment
of mechanics or laborers. shall Include a pro-
vision for compliance with sections 103 and
107 of the Contract Work Hours and Safety
Standards Act (40 U,S,C. 327-330) as sup-
plemented by Department of Labor regula-
I
A-110:22
tlons (29 CFR, Part 5). Under section 103
of the Act, each contractor sha.ll be re-
quired to compute the wages of every me-
chanic and laborer on the basIs of a standard
work day of 8 hours and a standard work
week of 40 hours. Work In excess of the
standard workday or workweek'ls permissible
provided th...t the worker Is compensated at a
rate of not less than I y, times the basIc
r:1.te of pay for all hours worked I n excess
of 8 hours In any calendar day or 40 hours
In the workweek. Section 107 of the Act is
appllcable to construction work and provides
that no laborer or mechanic shall be required
to work In surroundings or under working
conditions which are unsanitary. hazardous
or dangerous to his health and safety as de-
termined under construction safetv and
health standards promulgated by the'Secre-
tary of Labor, These requirement., do "ot
apply to the purchases of supplles or mate-
rials or articles ordinarily available on the
open market. or contrncts for transportation
or trl\nsml,~lon of IntFlllgence,
h. Contracts or agreements. the principal
purpose of, which L. to create. develop or Im-
prove products. processes or met.hods: or for
exploration Into fields that directly concern
public health, safety or welfare; or contracts
In the field of science or technology in which
there has been little signIficant experience
out..lde of work funded by Federnl assist-
ance, shall contain a notIce to the effect ,that
matters regarding rights to Inventions and
materials generated under Ihe contract or
agreement are subject to the regulations Is-
sued by the Federal sponsorIng agency and
the reclplent. The contractor shall be ad-
vised as to the source of addl tlonal Informa-
tIon regarding these matters.
I. All negotiated contraots (except those
of $10.000 or less) awarded by recipients
shall Include a provision to the effect that
the recipient, the Federal spoll.50rlng agency,
the Comptroller General of the United States,
or any of ~helr duly authorized reoresenta-
tlves. shall have acc""" to anv books. docu-
ments, papers and records of'the contractor
which are directly pertinent to a specIfic pro-
gram for the purpose of making audits,
examinations, excerpts and transcriptions,
J. Contracts and subgrants of amounts In
excess of $100.000 shall contain a provision
that requires the reCipient to agree to com-
ply with all applicable standards. orders or
reKulatlons Issued pursuant to the Clear Air
Act of 1970 (42 U,S,C, 1857 et seq) and the
Federal W...ter Pollution Control Act (33
U,S,C, 1251 et seq.) as amended, Violations
shall be reported to the Federal s~nsorlng
agency and the Rel(lonal Ornce of the En-
vlronment..1 Protectlon Agency, -
IFR Ooc,76-2 1904 FIled 7-29-76:8:45 aritJ
1
I
COMMUNITY PRIDE CHILD CARE CENTER OF CLEARWATER, INC.
APPENDIX H
OMB
Circular A-110
I I
Office of Management and Budget Circular A-122 (6/27/80) A-122:1
OFPlCE OF MANAGEMENT AND
BUDGET
arcular A-:122,''Cost Principles for
Nonprofit Organizations"
AGENCY: Office of Management and
Budget.
ACTION: Final Policy.
June 27. 1960
To The Heads of Executive
Departments and Establishments
Subjl,?ct: Cost principles for nonprofit
organizations:
1. Purpose. This Circular establi:;hes
principles for determining costs of
grants. contracts and other agreements
with nonprofit organizations. It ooes not
apply to colleges al'.d universities which
are covered by Cin:ular A-2!; State.
local. and federally recognized Indian
tribal governments which are covered
by Circular 74-4; or hos?ilal8. The
principles are designed to provide thai
the Federal Government bear its fair
share of costs excent where restriGled or
prohibited by law. The principles do not
attempt to prescribe'the extent of cost
sharing or matching on'grants. contracts,
or other agreemel~ts. However. such cost
sharing or ma tching shall not be
accomplished th1"ough arbitrary
limitations on individual cosl elements
by Federal agencies. Provision fer profit
or other increment above cost is outside
the scope of this Circular.
Z. Supersession. This Circular
!'llpersedes cost principlcls issued by
individual agencies for non'proflt
organization.
3. Applicability. a. These principles
shall be used by aHFederal agencies in
determining the costs of work performed
by nonprofit organizations under grants,
cooperative agreements. cost
reimbur:;ement contracts. and other
contracts in which costs are used in
pricing. administration. or se'ttlement.
All of these instruments are hereafter
referred to as awards. The principles do
not apply to awards under which an
organization is not required to account
to the Government for actual costs
incurred.
b. All cost reimbursement subawards
(subgrnnts. subcontracts, etc.) are
subject to those Federal cost principles
applicable to the particular organization
concerned. Thus. if a subaward is to a
nonprofit organization. this Circular
'shall apply; if a- subaward is to a
commercial organization. the cost
principles applicable to commercial
concerns shall apply; if a subaward is to
a college or university, Circular A-Zl
flhall apply; if a subaward is to a State,
local. -orfede!l8Hy'reod~izlfd lnGt.8n'
tribal govenunent, Gi~ullU' 74'-4 shall
apply.
4. Definitions. a. "Nonprofit
organization" means any corporation,
trust, association. cooperative. or other
organization whit:h (1) is operated,
primarily for scfentific. educational.
service. charitable, or similar purposes
in the public interest; (Z) is not
organized primarily for profit; and (3)
uses its net proceeds. to maintain.
improve. and/or expand its operations,
For this purpose. the term "nonprofit
organization" excludes (i) colleges and
universities; (ii) hospitals; (iii) State.
local. and federally recognized Indian
tribal governments; and (iv) those
nonprofit organizations which are .
excluded from coverage of this Circular
In accordance with paragraph 5 below.
b. "Prior approval" means secu:ing
the awarding agency's permission in
advance to incur cost for those items
that are designated as requiring prior
approval by the Circular. Generally this
permission will be in writing. Where an
item of cost r('quiring prior approval is
spet:ified in the budget of an.award.
apploval of the budget constitutes
approval cf that cost.
5. Exclusion of some nonprofit
organizations. Some nonprofit
organizations, because of their size and
nature of operations. can be considered
to be similar to commercial concerns for
purpose of applicability of Cost
principles. Such nonprofit organizations
shall operate under Federal cost
principles applicable to commercial
concerns. A lis ling of these
organizations is colluined.in
Attachment C. Other organizaUons may
be added from time to time.
6, RespoMibilities. Agencies
responsible for administering programs
that inv~ve awards to nonprofit
organizations shall implement the
provisions of this Circular. Upon
request. implementing instruction shall
be furniBhed to the Office of
Management and Budget Agencies shall
designate a liarson official to serve 8S
the agency representative on matters
relating to the implementation of this
Circular. The name and title of such
representative shall be furnished to the
Office of Management and Budget
within 30 days of the date of this
Circular.
7. Attachments. The principles and
related policy guides are set forth in the
following Attachments:
Attachment A-Gt!neral Principles
Attachment B-Selected Items of Cost
Attachment C-Nonprofit
Organizatiol1S Not Subject !p This
Circular
8. Requests {orexceptioJls. The Office
of Management and Budget may grant
exceptions to the requirements of this
Circular when permissible under
existing law. However. in the interest of
achieving maximum uniformity,
exceptions will be permitted only in
highly unusual circumstances.
9. Effective Date. The RfOvisions of
this Circular are effective immediately.
Implementation shall be phased in by
incorporating the provisions into new
awards made after the start of the
organization's next fiscal year. For
existing awards the new principles may
be applied if an organization and the
cognizant Federal agency agree. Earlier
implementation. or a delay in
implementation of individual provisions
is also permitted by mutual agreement
between an organization and the
cognizant Federal agency.
10. Inquiries. Further information
concerning this Circular may be
obtained by contacting the Financial
Management Branch. Budget Review
Division. Office of Management and
Budget, Washington. D.C. 20503,
telephone (ZOZ) 395-4773. .,
Jamr.s T. Mcintyre. Jr..
Director.
[Circular No. A-122]
Attachment A
General Principles
Table of Contents
A. Basic Considerations
1. Composition of total costs
2. Factors affecting allow ability of costs
3. Reasonable costs
4. Allocable costs
5. Applica ble credits
6. Advance understandings
B. Direct Costs
C. Indirect Costs ,
D. Allocation of Indirect Costs and
Determination of Indirect CosI Ratell
1. Genp.ral
2. Simplified allocation method
3. MulHple allocation base method
4. Direct allocation method
5. Special indirect cost rates
E. Negotiation and Approval of Indirect Cost
Rates
1, Definitions
2. Negotiations and approval of rates
[Circular No. A-12l]
Attachment A
General Principles
A. Basic Considera/io/ls.
1. Composition of total costs. The total cost
of an award is the sum of the allowable
direcl and allocable indirect cosls less any
applicable credits.
2. FaLtors affecting allowability of costs.
I
Office of Management and Budget Circular A-122 (6/27/80)
To be allowable under an award. costs ~t
meet the following8eneral criteria:
a. Be reasonable for the performance of the
award and be aUocable thereto under these
principles.
b. Conform to any limitations or exdusiona
set forth in these principles or in the award
as to types or amotiiJt of coslilelll3.
c. Be coilsisteut W,ith policies and
procedures that apply uniformly to hath
federally financed and other activilies of the
organization.
d. Be accorded consistent treatment.
e. Be determined in accotdance wttb
generally accepted accouniing principles.
(. Not be included asa cost or used to meet
cost sharing or matching nlquirements .of any
other federally finartcedprogram in either the
current or !I ,prior period.
g. Be adequately documenred.
3. Reasonable costs. A cost is reasonllbJe
if. in its nalure or amount. ir:does not exceed
that which would be IncuJ+ed bya pmdent
person under the circumstllnces prl!vailing at
the lime the decision was made to incur the
costs. The question of the reasonableness.of
specific costs must be scruMized wilh-
particular care in connecti91l with
organizations or separate divisions thereof
which receive the preponderance o(their
support from awards made' by Federal
agenCies. In determining the reasonabll!ness
of a given cost, consideration shall be given
to:
a. Whether the cost is of a type generally
recognized as ordinary and necesifary for the
operation of the organization or the
performance of the award.
b. The restraints or requirements imposed
by such factors as generally accepted sound
business practices, arms length bargaining.
Federal and State laws and regulations. and
terms and conditions of the award.
c. Whether the indivtde:alsconcerned acted
with prudence in the circumstances,
considering their responsibilities to the
organization. its members. employees, and
clients. the public at large. and the
Government.
d. Significant deviations from the
established practices of the org~nization
which may 'unjustifiably increase the award
costs.
4. Allocable costs.
a. A cost is allocable to a particular cost
objective, such as a grant, project, service, or
other activity. in accordance with the relative
benefits received. A cost is allocable to a
Government award if it is treated
consistently with other costs incurred for t~e
same purpose in like circumstances and if iI:
(1) 15 incurred specifically for the award.
(2J Benefits both the award and other work
and can be distributed in reasonable
proportion to the benefits received.
(3J Is neCEssary to the overall operation of
the organiza tion. although a direct
relationship to any particular cost objective
cannot be shown.
b. Any cost allocable to a parlicular award
or other cost objective under these prinr.iples
may not be shifted to other Federal awards to
overcome funding deficiencies, or to avoid
restrictions imposed by law or by the terms
of the award.
5. Applicable crecilts.
a. The term applicable credits refers to
those receipts, or reduction of expenditures
which operate to offset or reduce expanses
items that are allocable to awards as direct
or indirect cost.. Typica! examples of such
transactions are: purchase discounts. reba tes
or allowances. recoveries or indemnities on
losses. insurance refunds. l!nd adjuslments of
overpayments or errODeous charges. To the
extent that such credits accruing or received
by the organization relate to allowable cost
they shall be credited 10 the Government
either as a cost reduc+Jon or cash r~und as
a ppropria te.
b. In some instances. the amounts received
form the Federal Government to finance
organizational activities or service operations
should be treated as applicable credits.
Specifically, the concept of netting such
credit items against related expenditures
should be applied by the organizaton in
delerming the rales or amounts to be
organization in determining the rales or
arnaounts to be charged to Federal awards
for services rendered whenever the facilities
or other resources used in providing such
services have been financed rlirectly. in
whole or in part. by Federal funds;
a(cJ For rules covering program income
(I.e.. gross income earned frolTt federally
supported activitiesJ see Attachment D of
OMB Circular A-1l0.
6. Advallceand ullderstandings. Under any
given"award the reaeonablenl!ss and
allocability of certain items of costs may be
difficuit to determine. This particularly true in
connection wilh orgizationa that receive a
preponderllnce of their suppOf't from Federul
agencies. In order to avoid .ubsequent
disallowance or disPlJte based 011
ul1reasonablenel\s or nonallqcability, it is
often desirable to seek a writiei1 agreement
with the cognizant or awarding a~ency in
advance of the incurrence of special or
unusal costs. The absence of an advance
agreement on any element of cost will not. in
itself. affect the reasonableness or
allocability of that element,
B. Direct Costs
1. Direct costs are those that can be
identified specifically wHh a particular final
cost objective: Le.. a particular award.
project. service. or other direct activity of an
orgaoization. However. a cost may not be
assjgned to an award as a direct cost if any
Other cost incurred for the same purpose, in
like circumstance. has been allocated to nn
award as an indirect cost. Cost identified
specifically with awards are direct cost of the
awards and are to be assigned directly
thereto. Cost identified specifically with other
filial c.ost objectives of the organization are
direct costs of those cost objectives and are
not to be assigned to other awards directly or
indirectly.
2. Any direct cost of a minor amount may
be treated as an indirect cest ofar reasons of
procticality where the accollnt treatment for
such cosl is consistently applied to all finnl
cost objectives.
3. The cost of certain activities are not
allowable as charges tl? Fedelal awards [see.
for example. fund raising costs in paragraph
I
A-122:2
21 of Attachment BJ. However, even though
these cost. are unallowable for purposes of
computing charges to Federal awards. they
nonetheless must be treated as direct cost for
purpose. of determining lndirect cost rates
and be allocated their share of the
organization's indirect costs if they represent
activilleswhich (1) include the salaries of
personnel. (2) occupy spitce, and {3J benefit
from the organization's indirect costs.
4. The costs of activities performed
primarily as a service to members, clients, or
the general public when significant and
necessary to the organization's mission must
be treated as direct costs when or not
allowable and be allocated an equitable
share of indirect costs. Some examples of
these type. of activities include:
a. Maintenance oj membership rolls,
subscriptions. publications, and related
functions.
b. Providing services and information to
members. legislative or administrative
bodies. or the public.
c. Promotion. lobbying. and other forms of
public rela tions.
d. Meetings and conferences except lhose
held to conduct the general administration of
the organization.
3. Maintenacne. protection. and investment
of special funds not used in opera tion of the
organization.
f. Administration"of group benefits on
behelf of members of clients including life
,and hospital insurance. annuity or retirement
plans. financial aid, etc.
e Indirect Cost.
1. Indirect costs are those that have been
incurred for common or joint objectives and
cannot ue reildily. identified with a particular
final ce.st objective. Direct Cust of minor
amounts may be trealed as indirect cosls
under thi! conditions described in paragraph
B.2. above. After direct costs have been
determined and assigned directly to awards
or other work as appropriate. indirect costs
tHe those remaining to be allocated to
bene filing cost objectives. A cost mllY not be
allocatad to an award as an indirect cost if
Cloy other cost incurred for the ;ome purpose.
in like circumstances. has been aS9iited to
an <<ward as a direct cost. 1
Z. Because of the diverse characteristics
and accounting practices of nonprofit
crganizations, it is not possible to specify the
types of cost which may be classified os
indirp.ct cost in all situation. However, typical
examples of indirect cost for many nonprofit
organizations may include depreciation or
use allowance!! on buildings and equipment.
the costs of operdting and maintaining
facilities. and gmeral admiDislralion and
g['neral expenses, such as the salaries and
expenses of executive officers. pi!rsonnel
administration. and accounting.
D. Allocation of Indirect Cost and
Df'lerminatioll of Indirect Cost Rutes.
1. Generol.
a. Where a nonprofit organizstion has only
onc n:ltjIJr function. or whel'e all its major
functions benefit from its indirect costs to
approximately the same degree. the
allocation of indirect costs and the
)
Office of Management and Budget Circular A-122 (6/27/80)
computation of IInindlrect GOst1'atemay be
accomplished through simplified alloation
procedures as described in parasraph Z
below.
b. Where an organization has several major
functions which benefit from its indirect costs
in varying degrees. alloca tion of indirect
costs may require the accumulation of such
costs Into separate cost groupings which then
are allocated individually to benefiting
functions by means of a base which best
measures the relative degree of benefit. The
indirect costs allocated to each function are
then distributed to irniividual awards and
other activities included in that dunction by
means of an indirect COlt rate(s).
c. The determination of what constitutes an
organization's major functions will depend on
its purpose in being; the types of services it
renders to the public. its clients, and its
members; and the amount of effort It devotes
to such activities as fund raising. public
Information and membership activities.
d. Specific methods for alloca ting indirect
costs and computing indirect cost rates along
wjth the conditions under whicb each method
should be used are described in paragraphs 2
through 5 below.
e. The base period for the alloca tion of
indiree'! costs is the period in which such
costs are incurred and accumulated for
allocation wo work performed in that period.
The base period normally should coincide
with the organization's fiscal year. but in any
evn!. shall be so selected a~ to avoid
Inequities in the allocation of the costs.
2. Simplified al/ocation method. .
a. Where an organization's major functions
benefit from its indirect costs to
approximately the S8me degre, the allocation
of indirect costs may be aGcomplished by (i)
separating the organization's total costs for
the base period as eHher direct or indirect.
and (ii) dividing the total allowable indirect
costs (net of appiicable credits) by an
equitable distribution base. The result of this
process is an indirect cost rate which is used
to distribute indirect costs to individual
a \'Iiards. The rate should be expressed as the
percentage which the total amount of
allowable indirect costs bears to the base
selected. This method should alos be used
where an organization has only one major
function encompassing a number of
individual projects or activities. and may be
used where the level of Federal awards to an
organization is relatively small.
b. both the direct costs and the indirect
costs shall exclude capital expenditures and
unallowable costs. However, unallowable
costs which represent !lctivities must be
included in the direct costs under the
conditions described in paragraph B.3. above.
c. The distribution base may be total direct
costs [excluding capital expenditures and
other distorting items, such HI major
subcontracts or s:Jbgrants). direct selaries
and wages. or olher base which results in an
equitable distribution. The distribution base
shall generally exclude participant suport
cosL~ as defined in paragraph 211 of
Attachment B.
d. Except where a ~,,!!cial rdle(s) is
required in accordance with paragraph 0.5
blilClw. .the ,indir2ct.cmlt:mtlr'a...aloped. Bder
the above principles .ia~~le.tg all
awal'lis at,lhe,OI'iani-uoB.H a special
rate(s) is requiced.appropriate modifications
shall be made in order to developlhe special
rate(s).
3. Multiple allocalion base'method.
a, Where an organization's indirect costs
benefit its major Junctions in varying degrees,
such costs shall be accumulated into separate
cost groupings. Each grouping shall then be
allocated individually to benefiting functions
by means of a base which best measures the
relative benefits.
b. The groupings shall be established so as
to permit the allocation of each grouping on
the basis of benefits provided to the major
functions. Each grouping should constitute a
pool of expenses that are of like character-in
terms or the functions they benefit and in
terms of the 1I1loclItion bURe whloh bust
measura the relative benefits providd to each
function. The number of separate groupings
should be held within practicallimils. taking
into consideration the materiality of the
amounts involved and the degree of precision
desired.
c. Actual conditions must be taken into
account in selecting the base to be used in
allocating the expenses in each grouping to
benefiting functions. When an allocation can
be made by assignment of a cost grouping
directly to the function benefited, Ihe
allocation shall be made in that manner.
When the expenses in a grouping are more
general in nature. the allocation should be
made through the use of a selected base
which produces results that are equitable to
both the Governmentlind the organization. In
general, any cost element or cost related
factor associated with the organization's
work is potentially adaptable for use 8S an
allocation base provided 1i) it can readily be
expressed In terms of dollars or other
quantitative measures (total direct costs,
direct salaries and wages, staff hours applied.
square feet used. hours of usage, number of
documents processed. population served, and
the like) and (ii) it is common to the
benefiting functions during the base period.
d. Except where a special indirect cost
rate(s) is required in accordance with
paragraph 0.5. below. the separate groupings
of indirect costs allocated to each major
function shall be agrp.gated and treated as a
common pool for that function. The costs in
the common pool shall then be distributed to
indivisual awars included In that function by
use of a single indirect cost rate.
e. The distribution base used in computing
the indirect cost rate for each function may
be total dirp.ct costs (excluding capital
c;penditures and other distorting items such
as major subcontracts and subgrantsJ, direct
~alaries and wages, or other ase which
results in an equitable distribution. The
distribution base shall generally exclude
participant support costs as defined in
paragraph 29. Attachment B. An indirect cost
rate should be developed fir each Sl!parate
indirect cost pool developed. The rate in each
case should be stated as the percentage
which the amount of the particular indirect
cost pool is of the distribution base identified
I
A-122:3
witbthatJOOf.
4. Dired allocation method
a. Some nonprofit organizations. treat 'all
costs as direct cos,ts expect general
administration and general expenses. These
organizations generally separate their costs
into thre basic categories: (i) General
administration and general expenses. (ii)
fund raising. and (ill) other direct functions
(including projects performed under Federal
awards). Joint costs. such as depreciation.
rental costs. operation and maintenance of
facilities. telephone expenses. and the like
are prorated indivisually as direct cost to
each category and to each award, or other
activity using a base most appropria te to the
particular cost being prorated.
b. This method is acceptable provided each
joint cO,st is prorated using a base which
accma tely measllres the benen ts provided to
eueli awnrd or other ncllvlly. '1'1", bus". 11111"1
be established in accordance with resonable
criteria. and be supported by current data.
This method is compatible with the
Standards of Accounting and Financial
Reporting for Voluntary Health and WeUare
Organizations issued jointly by the National
Health Council. Inc.. the National Assembly
of Voluntary Health and Social Welfare
Organizations. and the United Way.of
America.
c. Under this method, indirect costs consist
eclusively of gp.neraladministration and
general expenses. In all other respects. the
organization's indirect cost ratess shal be
computed in the sa.me manner as that
described in paragraph 0.2 above.
5: Special indirect cost rates. In some
instances. a single indirect cost rate for all .
activities of an organization or for each major
function of the organization ay not be
appropriate. since it would not take into
account those different factors which may
substantially affect the indirect costs
applicable to a particular segment of work.
For this purpose. a particular segment of
work. For this purpose, a particular segment
of work may be that performed under a single
award or it may consist of work under a
group of awards performed in a common
environment. the factors may inc1ude the
physical location of the work, the Jevp.[ of
administrative support required, the nature of
the facilities or order resources employed. the
scientific disciplines or technical skills
involved. the organizational arrangements
used. or any combination thereof. When a
particular segment of work is performed in an
environment which appears to generate a
significantly different level of indirect costs,
provisions should be made for a separa te
indirect cost pool applicable to such work.
The separate indirect cost pool should be
developed during the course of the regular
allocation process. and the separate indirect
cost rate resulting therefrom should be used
provided it is determined that (i) the rate
differs significantly from that which would
have been obtained under paragraph 0.2, 3,
and 4 above. and (ii) the volume of work to
which the rate would apply is material.
E. Negotiation and Approval of Indirect Cost
Rates.
J
Office of Management and Budget Circular A-122 (6/27/80)
1. Definitions. As used in this section, the
following terms have the meanings set forth
below:
a. "Cognizant agency" means the Federal
agency responsible for negotiating and
approving indirect cost rates for a nonprofit
organization on behalf of all Federal
agencies.
b. "Predetermined rate" means an indirect
cost rate. applicable to a specified current or
future period, usually the organization's fiscal
year. The rate is based on an estimate of the
costs to be incurred during the period, A
predetermined rate is not subject to
adjustment.
c. "Fixed rate" mea liS an indirect cost rate
which has the same characteristics as a
predetermined rate, except, that the difference
between the estimated costs and the actual
costs of the period covered by the rate is
carried forward as an adjustment to the rate
computation of a subsequent period.
d. "Final rate" means an indirect cost rate
applicable to a specified past period which is
based on the actual costs of the period. A
final rate is not subject to adjustment.
e. "Provisional rate" or billing rate means a
temporary indirect cost rate applicable to a
specified period which is used for funding,
interim reimbursement, and reporting indirect
costs on awards pending the establishment of
a ra te for the period.
f. "Indirect cost proposal" means the
documentation prepared by an organization
to substantiate its claim for the
reimbursement of indirect costs. This
proposal provides the basis for the review
and negotiation leading to the establishment
of an organization's indirect cost rate.
g. "Cost objective" means a function,
organizational subdivision, contract, grant, or
other work unit for which cost data are
desired and for which provision is made to
accumulate and measure the cost of
processes, projects, jobs and capi talized
projects.
2. Negotiation and appral'al of rates.
a. Unless different arrangements are
agreed to by the agencies concerned, the
Federal agency wifh the largest dollar value
of awards with an organization will be
designated aa the cognizant agency for the
negotiation and approval of indirect cost
rates and, where necessary, other rates such
as fringe benefit and computer charge.out
rates. Once an agency is assigned cognizance
for a particular nonproTi t organiza tion, the.
assignment will not be changed unless there
Is a major long. term shift in the dollar volu~
of the Federal awards to the organization. All
concerned Federal agencies shall be given the
opportunity to participate In the negotiafion
process, but after a ra te has been agreed
upon it will be accepted by all Federal
agencies. When a Federal agency has reason
to believe that special operating factors
affecting its awards necessita te special
indirect cost rates in accordance with .
paragraph 0.5 above, it will, prior 10 the time
the ra tes are negotia ted, notify the cognizant
agency.
b. A nonprofit organization which has not
previously established an indirect cost rate
with a Federal agency shall after the
organization is advised.that an award will ba
made and, in no event, later than three
months after the effective date of the award.
c. Organizations that have previously
established indirect cost rates must submit a
new indirect cost proposal to the cognizant
agency within six months after the close of
each fiscal year.
d. A predetermined rate may be negotiated
for use on awards where there is reasonable
assurance, based on past experience and
reliable projection of the organization's costs,
that the rate is not likely to exceed a rate
based on the organization's actual costs.
e. Fixed rates may be negotiated where
predetermined rates are not considered
appropriate. A fixed rate, however, shall not
be negotiated if (i) all or a substantial portion
of the organization's awards are expected to
expire before the carry-forward adjustment
can be made: (ii) the mix of Government and
non-government work at the organization is
too erra tic to permit an equitable carry-
forward adjustment: or (Iii) the organization's
operations fluctuate significantly from year to
year.
f. Provisional and final rates shall be
negotiated :where neither predetermined nor'
fixed rates are appropriate.
g. The results of each negotiation shall be
formalized in a written agreement between
the cognizant agency and the nonprofit
organization. The cognizant agency shall
distribute copies of the agreement to all
concerned Federal agencies.
h. If a dispute arises in a negotiation of an
indirect cost rate between the cognizant
agency and the nonprofit organization, the
dispute shall be resolved in accordance with
the appeals procedures of tbe cognizant
agency.
i. To the extent that problems are
encountered among the Federal agencies in
connection with the negotiation and approval
process, the Office of Management and
Budget will lead assistance as required to
resolve such problems in a timely manner.
[Circular No. A-l22]
Attachment B
Selected Items of Cost
Table of Contents
1. Advertising costs
2. Bad debts
3. Bid and proposal costs (reserved)
4. Bonding costs
5. Communication costs
6. Compensation for personal services
7. Contingency provisions
6. Contributions
9. DepM!c1atlon Bnduse allowances
10. Donations
11. Employee morale, health and 'welfare
costs and credit.
12. Entertainment costs
13. Equipment and other capital expenditures
14. Fines and penalties
16. Fringe benefitl
16. Idle facilities and idle capacity
17. Independent resellrch and development
(resen'ed)
18. Insurance and indemnification
19. Interest. fund-raising, and investment
management costs
20. Labor relations costs
I
A-122:4
21. Losses on other awards
22. Maintenance and repair costs
23. Materials I\iJld supplies
24. Meetings. conferences
25. MemLerships, subscriptions. and
pmfessional activity costs
26. Organization costs
7:7. OVl'rtime, extra.pay shift. and .multishil't
premiums
28. Page chargl's in professional journals
29. Participant support costs
30. Patent costs
31. Pension plans
32. Plant security costs
33. Preaward costs
34. Professional service costs
36. Profits and losses on disposition of
depreciable property or other capital
assets
36. Public information service costs
37. Publication IInd printing costs
do. Rearrangement and alteration costs
39, Reconversion costs
40. Recruiting costs
'41. Relocation costs
42. Rent,al costs
43. Royalties and other costs for u1;e of
patents and copyrights
44. Severance pay
45. Specialized service facilities
46. Taxes
47. Termination costs
46. Training and education costs
49. Transportation costs
50. Travel costs
[Circular No. A-l22]
Altaclunent B
Selected Items of Cost
Paragraphs 1 through 50 provide principles
to be applied in establishing the allowability
of certain items of cost. These principles
apply whether a cost is treated as direct or
indirect. Fa.ilure to mention a particular item
of cost is not intended to impl}' that It is
unallowable: rather determination as to
allowability in eaCh case should be based on
the treatment or principles provided for
similar or related items of cosl.
1. Advertising costs. "I
a. Advertising costs mean the costs of '
media services and associated costs. Media
advertising includes magazines. ne~papJrs.
radio and television programs. direct mail
exhibits. and tbe like.
b. The only advertising costs allowable are
those which are solely for (i) the recruitment
of personnel when considered in conjunction
with all other recruitment costs, as set forth
in paragraph 4O;.(ii) the procurement of goods
and services: (iii) the disposal of. surplus
materials acquired in the petformaDl;~ of the
award except when organizations are
reimbursed for disposals at II predetermined
amount in accordance with Attachment N of
OMB Circular t\,-110; or (Iv) specific
requirements of the award.
2. Bad debts. Bad'tlebts. including losses
(whether actual or estimated) arising from
uncollectible accoants and other claims,
related collection costs. IInd related legal
costs. are unallowable.
3. Bid and proposal costs. (reserved)
4. Bonding costs.
,- ,
.
I
Office of Management and Budget Circular A-122 (6/27/80)
a, Bonding costs arise when the
Government requires,assurance against
financial loss to itself or others by reason of
the act or defaull of the organization. l11ey
li~isl'! also in instances where the organization
requires similar assuranoe. Included are such
bonds as bid, perfonnance. payment.
athance payment, Infringement. and fidelity
bonds.
b. Costs of bonding required pursuant 10
the terms of the award are allowahle.
c. Costs of bonding required by the
organization in the general conduct of ils
operations are allowable to the extent that
such bonding is in accordance with sound
business practice and the rates and premiums
ilre reasonable under the circumstances.
5. Communication costs. Costs incurred for
telephone services, local and long distance
telephone calls, telegrllJl\B. radio8l'sms,
postage 'Ind the like, are allowable.
6. Compensation for personal services.
a, DefinitiQn. Compensation for personal
services includes 1111 compensation paid
currenlly or accrued by the organization for
services of employees rer.dered during the
period of the award, (except as otherwise
provided in paragraph g. below). It includes.
but is not limited to, salaries, wages,
director's and executive committee member's
fees. incentive awards, fringe benefits,
pension plan costs, allowances for off-sile
pay, incentive pay, location alluwances,
hcrdship pay, and cost of living differentials.
b. A'lIowabi/ity. Except as otherwise
specifically provided in this paragraph the
costs of such compensation are allowable to
the exlentthat:
(1) Total compensation tO,individual
employees is reasonable for the services
rendered and conIonns to the established
policy of the organization consistently
applied to both Government and Don-
Government activities; and
(2) Charges to awards whether lr1lated as
direct or indirect costs are determined and
supported a\ required in this paragraph.
c, Reasonableness.
(1) When the organization is predominantly
engaged in activities ol\ler than those
sponsored by the Government. compensation
for employees on Government-sponsored
work will be considered reasonable to the
extent that it is consistent with that paid for
similar work in the organization's other
activities.
(2) When the organization is predominantly
engaged in Government-sponsored activities
and in cases where the kind of employees
required for the Government activities,afe
not found in the organization's other
activilies, compensation for employees on
Government-sponsored work will be
considered reasonable to the extent that il is
comparable to that paid for similar work in
the labor markets in which the organization
competes for the kind of employees involved.
d, Special considerations in determining
a 110 wability. Certain conditions require
special consideration and possible limitetions
in determining costs under Federal awards
where amounts or types of compensation
appear unreasonable. Among such conditions
ere Ihe following:
(1) Compensation to members of nonprofit
organiultions, trustees, directors, associates,
officers, or the immediate families thereof.
Determination should be made that such
compensation is reasonable for the actual
personal services rendered rather than a
distribution of esrnings in excess of costs.
(2) Any change in an organization's
compensation policy resulting in a
substantial increase in the orga~ization's
level of compensation. particularly when il
was concurrent with an increase in the ratio
of Government awards to other activilies of
the organization or any change in the
treatment of atlowaoililj of specific types of
compensation due to changes in Government
policy.
e. Unallowable costs. Costs which are
unallowable under other paragraphs of this
Attachment shall not be allowable under this
paragraph solely on the basis thst they
constitute personal compensation.
f. Fringe benefits.
(1) Fringe benefits in the fonn of"regular
compensation paid to employees during
periods of authorized absences from the job.
such as vacation leave, sick leave, military
leave, and the like, are allowable provided
such costs are absorbed by all organization
activities in proportion to the relative amount
of time or effort actually devoted to each.
(2) Fringe benefits in the fonn of employer
contributions or expenses for social security,
employee insurance, workmen's
compensation insurance. pension plan costs
(see paragraph g. below), and the like, are
allowable provided such benefits are granted
In accordance with established written
organization policies. Such benefits whether
treated 118 indirect costs or as direct costs,
shall be distributed to particular awards and
other activilies in a manner consistent with
the pallern of benefits accruing to the
individuals or group of employees whose
salaries and wages a~e chargeable to such
awards and other aclivities.
(3)(a) Provisions for a reserve under a self-
Insurance program for unemployment
compensation or workmen's compensation
are allowable to the extent that the
provisions represent reasonable estimates of
the liabilities for such compensation. and the
types of coverage. extent of coverage, and
rates and premiums would have been
allowable had insurance been purchased to
cover the risks. However, provisions for self-
insured liabilities which do not become
payable for more than one year after the
provision is made shall not exceed the
present va.lue of the liability.
(b) Where an organization follows a
consistent poley of expensing actual
payments to, oroa. behaJf of. employees or
tonner employees for unemployment
:Compensation or workmen's compansation,
luch.payments are allowable in the year of
payment with the prior approval of the
awarding agency provided they are allocated
to all activities of the organization.
(4) Costs of insurance on the lives of
trustl'es, officers, or other employees holding
positions of similar responsibility are
allowable only to the extent that the
insurance represents additional
compensation, The costs of such insurance
when the organization is named as,
,
A-122:S
beneficiary are unallowable.
g. Pension plan costs.
(1) Costs of the organization's pension plan
which are incurred in accordance wilh the
established policies of the organization are
allowable, provided:
(a) Such policies meet the test of
reasonableness;
(b) The methods of cost allocation are not
discrimina tory;
(c) The cost assigned to each fiscal year is
determined in accordance with generally
accepted accounting principles as prescribed
in Accounting Principles Board Opinion No.6
issued by the American Institute of Certified
Public Accountants; and
(d) The costs assigned to a given fiscal year
ere funded for all plan participants wilhin six
months aiter the end of that year, However.
incre,ases to nonnal and past service pension
costs caused by a delay in funding the
sctuarialliabilily beyond 30 days after each
quarter of the year to which such costs are
assignable are unallowable.
(2) Pension plan termination insurance
premiums paid pursuant to the Employee
Retirement Income Security Act of 1974 (Pub.
1.. 93-406) are allowable. Late payment
charges on such premiums are unallowable.
(3) Excise taxes on accumulated funding
deficiencies and other penalties imposed
under the Employee Retirement Income
Security Act are unallowable.
h, Incentive compensation, Incentive
compensation to employees based on cost
reduction, or efficient perfonnance,
suggestion awards. safety awards, etc., 'are
allowable to Ihe extent that the overall
compensation is detennined to be reasonable
and such costs are paid or accrued pursuant
to an agreement entered into in good faith
between the organization and the employees
before the services were rendered, or
pursuant to sn established plan followed by
the organization so-consistently as to imply,
in effect, an agreement to make such
payment.
i. Overtime, extra pay shift. and multishift
premiums. See paragraph 27.
j. Severance pay. See paragraph 44,
k. Training a1?d education ao~ts. See
paragraph 48. .
I. Support of salaries and wages: .
(1) Charges 10 awards for salarie~ and
wages. whether treated as direct costs or
indirect costs, will be based on documented
payrolls approved by a responsible official(s)
of the organization. The distribution of
salaries and wages to awards must be
supported by personnel activity reports as
prescribed in subparagraph (2) below, except
when a substitute system has been approved
in writing by the the cognizant agency. (See
paragraph E.2 of Attachment AJ
(2) Reports reflecting the distribution of
activily of each employee must be
maintained for all staff members
(professionals and nonprofessionals) whose
compensation is charged, inwhole or in part,
directly to awards. In addilion, in order to
support the allocation of indirect costs, such
reports must also be maintained for other
employees whose work involves two or more
funcitons or activities if a distribution of their
compensation between such functions or
activilies ia needed in the detennination of
I
1
Office of Management and Budget Circular A-122 (6/27/80)
the-organization's indirect cost rate(s) (e.g..
an employee engaged part-time in indirect
cost activities and part-time in a direct
function). Reports maintained by nonprofit
organizations to satisfy these requirements
must meet the following standards:
(a) The reports must reflect an after-the-
fact determination of the actual activity of
each employee. Budget estimates (i.e..
estimates determined before the services are
performed) do not qualify as support for
charges to awards.
(b) Each report must account for the total
activity for which employees are
compensated and which is required in
fulfillment of their obligations to the
organization.
(c) The reports must be signed by the
individual employee. or by a responsible
supervisory official having first hand
knowledge of the activities performed by the
employee. that the distribution of activity
represents a reasonable estimate of the
actual work performed by the employee
during the periods covered by the reports.
(d) The reports must be prepared at least
monthly and must coincide with one or more
pay periods.
(3) Charges for the salaries and wages of
nonprofessional employees. in addition to the
'supporting documentation described in.
subparagraphs (1) and (2) above. must also
be supported by records indicating the total
number of hours worked each day
maintaioed in conformance with Department
of Labor regulations implementing the Fair
Labor Standards Act (29 CFR Part 516). For
this purpose. the tenn "nonprofessional
employee" shall have the same meaning as
"nonexempt employee." under the Fair Labor
Standards Act.
(4) Salaries and wages of employees used
iQmeeting cost sharing or matching
requirements on awards must be supported in
the same manner as salaries and wages
claimed for reimbursement from awarding
agencies.
7. Contingency provisions. Contributions to
it contingency reserve or any similar
provision made for events the occurrence of
which cannot be foretold with certainty as to
time. intensity. or with an assurance of their
happening. are unallowable. The term
"contingency reserve" excludes self-
insurance reserves (see paragraph 6.f.(3) and
18.a.(2J(d)): pension funds (see paragraph
6.(g)): and reserves for normal severance pay
(see paragraph 44.(bJ(l).
8. Contributions. Contributions and
donations by the organization to others are
unallowable.
9. Depreciation and use allowances.
a. Compensation for the use of buildings.
other capital improvements. and equipment
on "and may be made through use
allowances or depreciation. However. excepl
as prl1vidcd in paragraph f. below a
~ombii1atioll of the two methods may not be
used in connection with a single class of
fixed assets (e.g,. b~ildings, office equipment.
computer equipment. etc.). .
b. The computation of use allowances or
d'~prE'ciation shall be based on the
acquisition cost of the assets involved. The
acquisition cost, of an asset dona led to the
organization by a third party shall be Its fair
market value at the time of the donation.
c. The computation of use allowances or
depreciation will exclude.
(1) The cost of land;
(2) Any portion of the cost of buildings and
equipment borne by or donated by the
Federal Government irrespective of where
title was originally vested or where it
presently resides; and
(3) Any portion of the cost of buildings and
equipment contributed by or for the
organization in satisfaction of a statutory
matching retirement.
d. Where the use allowance method is
followed, the use allowance for buildings and
improvement (including land improvements
such as paved parking areas. fences. and
sidewalks) will be computed at an annual
rate not exceeding two percent of acquisition
cost. The use allowance for equipment will
be computed at an annual rate not exceeding
six and two-thirds percent of acguisition cost.
When the use allowance methocfis used for
buildings. the entire building must be treated
as a single asset; the building's components
(e.g. plumbing system. heating and air
conditioning. etc.) cannot be segregated from
the building's shell. The two percent
limitation. however. need not be applied to
equipment which is merely attached or
fastened to the building but not permanently
fixed to it and which is used as furnishings or
decorations or lor specialized purposes (e.g.,
dentist chairs and dentallreatment units,
counters. laboratory benches bolted to tho
floor, dishwashers, carpeting. etc.). Such
equipment will be considered as not being
pel'manently fixed to the building if it can be
removed without the need for costly or
extensive alterations or repairs to the
building or the equipment. Equipment that
meets these criteria will be subject to the six
and two-thirds percent equipment use
allowance limitation.
e. Where depreciation method is followed,
the period of useful service (useful life)
established in each case for usable capital
assets must take into consideration such
factors as type of construction. nature of the
equipment used. technological developments
in the particular program area. and the
renewal and replacement policies followed
for the the individual items or classes of
assets involved. The method of depreciation
used to assign the cost of an asset (or group
of assets) to accounting periods shall reflect
the pattern of consumption of the asset
during its useful life. In the absence of clear
evidence indicating that the expected
consumption of the asset will be significantly
greater or lesser in the early portions of its
useful life than in the later portions. the
straight-line method shall be presumed to be
the appropriate method. Depreciation
methods once used shall not be changed
IInless approved in advance by the cognizant
Feeleral agency. When the depreciation
method is introduced for application to assets
previously subject to a use allowance. the
combination of use alluwances and
depreciation applicable to such assets must
not exceed the total acquisition cost of the
assets. When the depreciation method is used
for buildings. a buildinll's shell may ue
A-122:6
segregated from each building component
(e.g., plumbing system, heating, and air
conditioning system. etc.) and each item
deprecia ted over its estima 'ed useful life: or
the entire building (Le.. the shell and all
components) may be treated as a single asset
and depreciated over a single useful life.
f. When the depreciation method is used
for a particular class of assets, no
depreciation may be allowed on any such
assets that. under paragraph e. above, would
be viewed as fully depreciated. However, a
reasonable use allowance may be negotiated
for such assets if warranted after taking into
consideration the amount of depreciation
previously charged to the Government, the
estimated useful life remaining at time of
negotiation, the effect of any increased
maintenance charges or decreased efficiency
due to age, and any other factors pertinent to
,the utilization of the asset for the purpose
contemplated.
g. Charges for use allowances or
depreciation must be supported by adequate,
property records and physical inventories
must be taken at least once every two years
(<.I stati.tical sampling basis is acceptable) to
ensure tha t assets exist and are usable and
needed. When the depreciation 'method is
followed. adequate depreciation records
indicating the amount of depreciation taken
each period must also be maintained.
10. Donations
a. Services received.
(1) Donated or volunteer services may be
furn:shed to an organization by professional
and technical personnel, consultants. and
other skilled and unskilled labor. The value
of these services is not reimbursable either as
a direct or indirect cost.
(2) The value of donated services utilized
in the performance of a direct cost activity
shall be considered in the determination of
the organization's indirect cost rate(s) and.
accordingly. shall be allocflled a
proportion'lte share of applicable indirect
costs when the following circumstan,ces exist:
(a) The agg~egate value of the services is
material:
(b) The services are supported b!i~
signific'1nt amotmt of ihe indirect costs. .
incurred by the organiza lion:
[c] The dirp.ct cost activity is not pursued
primarily for the benefit of the Federal
Guvr,rnment.
(3) In those instances where there is no
basis for determining the fair market value of
the services rendered. the recipient and the
cognizant agency shall negotiate an
appropriate ailocation of indirect cost to the
services.
[4] Where donated services directly benefit
a ~roject supported by an a ward, the indirect
costs allocated to the services \\om be
considered as a part of the total costs of the
project. Such indirect costs may be
reimbursed under the award or used to meet
cost sharing or matching requirements.
(5] The value of tlle donated services may
be used to meet cost sharing or matching
requirements under conditions described in
I\Uachment E. OMB Circular No. A-110.
Where dona ted services are trea ted as
indirect costs, indirect cost rates will
separate the value of the donations so that
I
Office of Management and Budget Circular A-122 (6/27/80)
reimbursement will not be made.
(6) Fair market value of donated services
shall be computed as follows:
(a) ]lates for volunteer services. Rates for
volunteers shall be consistent with those
regular rates paid for similar work in other
activities of the organiza tion. In cases where
the kinds of skills involved are not found in
the other activities of the organization. the
rates used shall be consistent with those paid
for similar work in the labor market in which
the organization competes for such skills.
(b) Services donated by other
organizations. When an employer donates
the services of en employee, these services
shall be valued at the emplo}'ee's regular rate
of pay (exclusive of fringe benefits and
indirect costs) provided the services are in
the same skill for which the employee is
normally paid. If the services are not in the
same skill for which the employee is normally
paid. fair market value shall be computed in
accordance with subparagraph (a) above,
b. Goods and space.
(1) Dpnated goods; i.e., expendable
personal property/supplies, and donated use
of space may be furnished to an organization,
The value of the goods and space is not
reimbursable either as a direct or indirect
cost.
(2) The value of the donations may be used
to meet cost sharing or matching share
requirements under the conditions described
In Attachment E. or.m Circular No. A-110.
The value of the donations shall be
determined in accordance with Attachment
E. Where donations are treated as indirect
costs. indirect cost rates will separate th,
value of the donations so that reimbursement
will not be made.
11. Employee morqle. health. and welfare.
costs and credits. The costs of house
publications, health or first-aid clinics, and/
or infirmaries, recreational activities,
employees' counseling services, and other
expenses incurred in accordance with the
organization's established practice or custom
for the improvement of working conditions.
employer-employee relations. employee
morale, and employee performance are
allowable. Such costs will be equitably
apportioned to all activities of the
organization. Income generated from any of
these activities will be credited to the cost
thereof unless such income has been
irrevocably set over to employee welfare
organizations.
12. Entertainment costs. Costs of
amusement, diversion, social activities.
ceremonials. and costs relating thereto, suet.
as meals, lodging. rentals, transportation, and
gratuities are unallowable (but see
paragraphs 11 and 25).
13. Equipment and other capital
e.\penditures.
a. As used in this paragraph. the following
le~havethe,m~<!nin~~! Jgrth below:
(1) "Equipment" means an article of
nonexpendable tangible personal property
having a useful life of more than two years
and an acquisition cost of $500 or more per
unit. An organization may use its own
definition provided that it at least includes all
non expendable tangible personal property as
defined herein.
(2) "Acquisition cost" means the net
invoice unit price of an item of equipment.
including the cost of any modifications.
attachments, accessories. or auxiliary
apparatus necessary to make it usable for the
purpose for which it is acquired. Ancillary
charges, such as taxes. duty. protective in-
transit insurance, freight, and installa tion
shall be included in or excluded from
acquisition cost in accordance with the
organization's regular written accounting
practices.
(3) "Special purpose equipr'lent" means
equipment which is usable only for research.
medical. scientific. or technical activities.
Examples of special purpose equipment
include microscopes. x-ray machines. surgical
instruments. and spectrometers.
(4) "General purpose equipment" means
equipment which is usable for other than
research. medical. scientific. or technical
activities. whether or not special
modifications are needed to make them
suitable for a particular purpose. Examples of
general purpose equipment include office
equipment and furnishings. air conditioning
equipment, reproduction and printing
equipment. motor vehicles. and automatic
data processing equipment.
b. (1) Capital expenditures for general
purpose equipment are unallowable as a
direct cost except with the prior approval of
the awarding agency.
(2) Capital expenditures for special purpose
equipment are allowable as direct costs
provided that items with a unit cost of $1000
or more have the prior approval of the
awarding agency.
c. Capital expenditures for land or
buildings are unallowable as a direct cost
except with the prior approval of the
awarding agency.
d. Capital expenditures for improvements
to land. buildings. or equipment which
materially increase their value or useful life
are unallowable as a direct cost except with
the prior approval of the awarding agency.
e. Equipment and other capital
expenditures are unallowable as indirect
costs. However. see paragraph 9 for
allowability of use allowances or
deprecia tion on buildings, capital
improvements. and equipment. Also. see
paragraph 42 for allowability of rental costs
for land. buildings. and equipment. ,
14. Fines and penalties. Costs of fines and
penalties resulting from violations of. or
failure of the organization to comply with
Federal, State, and local laws and resulations
are unallowable except when incurred as a
result of compliance with specific provisions
of an award or instructhns in writing from
the awarding agency.
15. Fringe benefits. See paragraph 6. f.
16. Idle facilities and idle capacity.
a. As used in this paragraph the following
terms have the meanings set forth below:
(1) "Facilities" means land and buildings or
any portion thereof, equipment individually
or collectively. or any other tangible capital
asset. wherever located. snd whether owned
or leased by the o16anization.
(2) "Idle facilities" means completely
unused facilities that are e"cess to the
organi2.ation's current needs.
(3] "Idle capacity" means the unused
I
A-122:7
capacity of partially used facilities. It is the
difference between tfrat wlrich a facility
could achieve under 100 per cent operating
time on a one-shift basis less operating
intelTUptions resulting from time lost for
repairs. setups. unsatisfactory materials. and
other normal delays, and the extent to which
the facility was actaally used to meet
demands during the ac:countinll period. A
multishift basis may be used if it can be
shown that this amount of usage could
normally be expected for the type of facility
involved.
(4J "Costs of idle Cac.llities or idle capacity"
means coslll such as maintenance. repair,
housing. rent. and other related costs; e.g..
property taxes. insurance. and depreciiition
or use allowances.
b. The costs of idle facilities are
unallowable except-to the extent that:
(1) They are unneces8ary to meet
fluctuations in workload; or
(2J Although not necessary to meet
fluctuations in workload. they were
necessary when acquired and are now idle
because of changes in program requirements.
efforts to achieve more economical
operationll. reorganization. termination. or
other causes which could not have been
reasonably foreseen. Under the exception
sta ted in this subparagraph. costs of idle
facilities are allowable for a reasonable
period of time. ordinarily not to exceed one
year. depending upon the initiative taken to
use. lease. or dispose of such facili ties [but
see paragraphs 47.b. and d.).
c. The costs of idle capacity are normal
costs of doing business and are a factor in the
normal fluctuations of usage or indirect cost
ra tes from period to period. Such costs are
allowable. provided the capacity i8
reasonably anticipated to be necessary or
was originally reasonable and is subject to
reduction or elimination by subletting.
renting, or sale, in accordance with sound
business. economics. or security practices.
Widespread idle capacity throughout an
entire facility or among a group of assets
having substantially the same function may
be idle facilities. .
17. !r"/."p2ndent research and development
[Reserved 1. ' .
18. Insurance and indemnification. }
a. Insurance includes insurance which the
organization is required to carry. or which is
approved. under the terms of the award and
any other insurance which the organization
maintains in connection with the general
conduct of its operations. This paragraph
does not apply to insurance which represents
fringe benefits for emr10yees (see pa~agraph
6J. and 6,g.(2)).
(1) Costs of in3mance r~quired or
approved. and maintained. pursuunt to the
award are allowable.
(2) Costs of other inSllrance ffiHintained by
the org,mization in connection with the
general conduct of its opel'a lions are
allowable subject to the following limitations.
(a) Types and extent of coverage shall be
in accordance with sound business practice
and the rlltes and premiums shall be
reasonable undl?r the circumstances,
[b I Cost~ allowed for business interruption
or other similar insurance shall be limited to
I
Office of Management and Budget Circular A-122 (6/27/80)
exclude coverage of managemf>nt fees.
(e) Costs of insurance or of any pro"i~ions
for a reserve covering the risk of loss ar
diill1Bge to Government property are
allowable only to ~he extent that the
orl!;\nizatian is Iiuole for such 108S OJ' dnmagp,.
iu) Provisions for 8 reserve under a self-
insurar,ce program are allowable to the
ex lent thatty;>es of coverage. extf'"t of
coverage. rates. and premiums would hav!!
been allowed had insu:ance been purchased
to cover the risks, However. proviili;)n for
knnwn or reasonably estimll!ed self.inaured
liabilities. which do not Decome payable for
more th;ln one year after the provision is
made shall not exceed the present value of
the liability.
[e) Costs of insuraI1ce on the lives of
trustees. officers. or other employees holding
positions of similar responsibilities a~e
allo.'Jable only to the extent that the
insurance represents additional
compensation (see paragraph 6). The CllSt of
such insurance when the org3nization is
identified as the beneficiary is unallow;;ble.
(3) Actualloss2s whkh could hal'e been
covered by perm;r.aible insurance [through
the purchase of insuran:.:e or a self. insurance
program) are unallowable unless expressly
provided for in the awarrl. except:
(a) Costs incurred berause of losses not
covered under nomin~l deductible insurance
coverage provided in keeping with sound
business practice are allowable.
. (b) Minor losses not covered by insurance.
such as spoilage. breakag'!, and
disappearance of supplies. which occur in the
ordinary COlifse of operations. are allowable.
b. Indemnification includes securing the
organization against liabilities to third
persons and any other loss or damag'!. not
compensated by insurance or otherwise. The
Government is obligated to indemnify the
organization only to lhe extent expressly
provided in the award.
19; Interest. fund raising. and inllestment
management casts.
a. Costs incurred for interest. on borrowed
capital or temporary use of endowment
funds. however represented. are unallowable.
b. Costs of organized fund raising.
including financial campaigns. endowment
drives. solicitation of gifts and bequests. and
similar expenses incurred solely to raise
capital or obtain contributions are
unallowable.
c. Costs of investment r.ounsel and staff
and similar expenses incurred solely to
enhance income frum Investments are
unallowable.
d. Fund raising and investment activities
shall be allocated an appropriate share of
indirect costs under the conditions described
in paragraph B of Attachment A.
20. Labar relations casts. Costs incurred in
maintaining satisfactory re!ations between
the organization and its employees. including
costs of labor management committees.
employee publications. and othe'r related
activities are allowable.
21. Lasses on other awards. Any exceS8 of
costs over income on any award is
unallowable a8 a cost of any other award.
This incrudes. but is not limited to. Ihe
organization's contributed portion by reason
of cosl sharing agreements or any
underrecoveries through negotiation of Jump
sums for. or ceilings on. indir'!ct costs.
Z2. lvIain!enance and repoir cast.s. Costs
incurred for necessary' maintenance. repair.
or upkeep ef buildings and equipment
(including Government property unless
o:herwi,e provided for) which neither aJd te)
the pennanent value of the property nor
appreciably prclong its intended life, bul
keep it in an eff'dent operating condition. are
allowahle, Costs incurred for i~provements
which add to the permanent value of the
buildings and equipment or appreciably
prolong their intended life shsll be treated as
capital expenditures (see par"graph 13J.
23. Materials and supplie.,. The cosls of
materials and supplies necessal'}' 10 carry out
an award are allow!lble. Such costs should be
charged a t their actual prices after deducting
all cash discounts. trade discounls. rebates.
and allowances received by Ihe organization.
Withdrawals from general stores or
stockrooms should be charged at cost under
any recognized method of pricing
consistently applied. Incoming transrortation
charges may be a proper part of malerial
cost. Materials and supplies charg,..r]'as 11
dir()ct cost should include only the mOlterials
and supplies actually used for the
performance of the contract or grant. and due
credit should be given for any exceS3
materials or supplies retained. or return..d to
vendors.
24. Meetings. conferences.
a. C08tS associated with the conduct of
meetings. and conferences. and include the
cost of renting facilities. meals. speakers'
fees. and the like. But see paragraph 12.
Enlertainment costs. an:! paragraph 29.
Porticipant support costs.
b. To the extent that these cosls are
identifiable with a particular cost objective.
they should be charged to that objective. (See
paragraph B. of Attachment A.) These costs
are allowable provided Ihat they meet Ihe
general tests of allowable. shown in
Attachment A to this Circular.
c. Costs of meetings and conferences held
to conduct the general administration of the
organization are allowable.
25. Memberships. subscrIptions. and
professional activity costs.
a. Costs of the organization's membership
in civic. business. technical and professional
organizations are allowable.
b. Costs of the organization's subscriptions
to civic. business. professional. and technical
periodicals are allowable.
c. Costs of attendance at meetings and
conferences. sponsored by othp-rs when the
primary purpose is the dissemination of
technical information. are allowab!e. This
induJes costs of meals. trar'/sportatron. and
other items incidental to such attendance.
26. Orgonizatian cas Is. Expenditures. such
GIS incorporation fees. brohrs' fees. fees to
promoters. organizers or management
consultants. attorneys. accountants. or
invc5tment counselors. wh!'lher or nol
~ml'!oyees of the organization. in connection
with establishment or reorganization of an
organi:.:ation. are unallowable except with
prior approval of the awarding agency.
27. O\'ertime. extra-pay shift. and
I
A-122:8
mu/!ishilt premiums. Premiums for overtinw.
extra.pay shifts. and lfiultishift work are
u!;owuulc oniy with lhl! prior appro_a! of tl:e
awarding agency eXl:ept:
a. When l\t:ceSSMY to cope with
er:lCrgeneics. such as those resulting fronl
11.,,,;,;',.-,'., natural lli~astprs. breakdowns of
I''lldprr ont. or Occ:lsirmal operational
t.o"lc~p{:l.:s of a sporadic nature.
h Vl.'hcn E:r:1piofe.~s are perforr.ling indirect
funclifJlIs sllch as ddministration.
mainlenance. or accounting.
c. In {he performailce of tests. laboratory
pron:Jures. ur olher similiH operations which
un~ co,.Lnuolls in na.'ure and cannol
rcascn~t>i:,. be interrupted or othcrwisI,
COIl\J-':~:Llti,
d, Wh~n lower overall cost tu the
GO"i('r~.netlt will result.
2B. Page (;horge~ in professional journals,
Page cha rges for professional journal
publica tions are allowable as a necessary
part of research :;os:s. where:
a. The research papers report work
supported l,y the Government; and
b. The cLarges are levied impllrlilllly on all
research r;~pers published by the journat.
whelh'Jr or nol by Government-sponsored
au lhnrs.
29. Parridpol/t support cDsls, ParUcipant
supporl costs are direct costs for items such
as stipends or subsistence allowances. travel
llllowanr.es, "nd registration fees paid to or
un behalf (Jf participants or trainees (but not
employe!:s) in connection with meetings.
conferences. symposia. or training projects,
These costs ace allowable with the prior
approval of the awarding agency.
30. Puti'mt cas Is.
a. CGsts oi (i) preparing disclosures.
r~p()rts. and other documents requimd by the
a...iird ,JlId of searching the art to the extend
necessary to make such disclosures. [ii)
prepuring documents and any other patent
Cllsts in connection with the filing and
prosecution of a United statp.s palent
applicalir,n where title or royalty.free license
is required by the Government to be
coaveyed to the Government. 'lnd (iii) general
(;Ounsclilig services relllting to pateh~and
copyright matters. such as lldvice on patenl
and copyright laws. :egulalions. clauses, and
employee agreements are allowable (but see
pnngraph 34).
b Cust of preparing discloslJres. repocts.
and other documents snd of sp.arching the art
to Ihp. extent np.cessary to make di~c1osures.
if not required by the award. He
unalluwable. Cosls in connection with [I)
filing and prosecuting any foreign palent
application. or [ii) any United States p<llcnt
application, where the award docs not
ref]l.,re conveying title or a royalty-fme
licp.nse tu the Go'.ernment. are unallowable
(,,]50 ;ee paragraph 43).
31. Pension plans. See paragraph 6. g.
32. Planl security costs, Necessary
expenses incurred to comply withoGovernment security requirements or for
facilities protection. including wages.
uniforms. and equipment of personnel are
ullowable.
33. Preoward cosls. Preaward costs are
those incurred prior to the effective date of
the award directly pursuant to the
I
Office of Management and Budget Circular A-122 (6/27/80)
negotiation and in anticipation of the ~ward
where such costs is necessary to comply with
the proiJosed delivery schedule or period of
performance. Such costs Are allowable only
tu :he extent that they would h.ave been
ailowable if incurred after the date of the
<Jwaril and only with the written approval of
the .awarding agency.
34, Professional service costs.
a. Costs of profe~sional and consultant
services rendered by persons who are
nlf"llUerS of a particular profe~sion or po~~ess
a spec;al skill. and who are not officers or
ernjJiuyees of the organization. arc allowable.
subject to b. c. and d. of this paragraph when
reasonable in rdation,to the services
reodered and when not contingent upon
reeovery of the costs frum the Government.
b. In det:lrming the allowability of roosts in
II particular case. no single factor or any
special combination of factors is necessarily
determinative. However. the following
factors are relevant:
(1) The nature and scope of the service
rendered in relation to the service required.
(21 The necessity of contracting for the
service. considering the organization's
capahility in the particular area.
(:j) The past pattern of such costs.
particularly in the years prior to Government
awards.
(4) The impllct of Government aw&rds on
the organization's business (Le.. what new
,prohlems have arisen).
(5) Whether the proportion of Government
work to the organization's total business is
such as to influence the organization in favor
of incurring the cost. particularly where the
services rendered are not of a continuing
nature and have little relationship to work
under Government grants and contractS.
(6) Whether the service can be performed
more economically by direct employment
rather than contracting.
(7) The qualifications of the individual or
. concern rendering the service and the
customary fees charged. especially on non-
Government awards.
(01 Adequacy of the contractual agreement
for the service [e.g.. description of the service.
estimate of time required. rate of
compensation. and termination provisions).
c. In addition to the factors in paragraph b
above, retainer fees to the allowable must be
supported by evidence of bona fide services
available or rendered.
d. Cost of legal. accounting. and consulting
services. and related costs incurred in
conn~ction with defense of antitrust suit!.
and the prosecution of clai-:ns against the
Government. are unallOWAble. Costs of legal.
ac(;uunting and consulting services. and
related costs, incurred in connection with
patent infringement litigation. organization
and reorgAnization. are unallowable unless
otherwise prclVided fOI in the award (but see
p.arngraph 47e).
35, ProfilS and losses on disposition of
depreciable property or other capital assets.
a. (1) Gains and losses on sale. retirement.
or other disposition of aepreciable property
shull be included in the year in which they
occur as credits or charges to cost grouping(s)
in which the depreciation applicable to such
property was included. The amount of the
gain or loss to be included as a credit or
charge to the appropriate cost grouping(s)
shall be the difference between the amount
realized on the property and the
unuepreciated basis of the property.
(Z) Gains and losses on the disposition of
depreciable property shall not be recognized
as a separate credit or charge under the
following conditions.
ta) The gain or loss is processed through a
depreciation reserve account and is renected
in the depreciation allowaule under
paragraph 9.
(b) The property is given in exchange as
pari of the purchase price of a similar item
and the gain or loss is taken into account in
determining the deprecialion cosl basis of the
new item.
(c) A loss results frum the failure to
maintain permissible insurance. except a8
otherwise prdVided in paragraph 18.a.(3).
(d) Compensation for the use of the
property was provided through use
allowances in lieu of depreciation in
accordance with paragraph 9.
(e) Gains and lusses arising from mass or
extraordinary sales. retirements. or other
dispositions shall be considered on a case-
by.ca~e basis.
b. Gains or losses- of any nature arising
from the sale or exchange of property other
than the property covered in paragraph a.
above sh1lll be excluded in computing award-
cas 15.
36. Public informatiun sen'ice costs.
a. Public information service costs include
the cost 8ssociated'with pamphlets. news
releases. and other forms of information
services. Such costa are normally incurred to:
(1) Inform or Instruct individuals. groups. or
the' general public.
(Z) Interest individuals or groups in
participating in a service program of the
01 gsniza tion.
(3) Disseminate the results of sponsored
and nonsponsored activities.
b. Public information service costs are
allowable as direct costs with the prior
approval of the awarding agency. Such costs
are unallowable as indirect costs.
37. Publication and printing costs.
a. Publication costs include the costs of
printing (including the processes 'of
composition. plate.making. press work.
binding. and the end products produced by
such processes). distribution. promotion.
mailing. and general handling.
b. If the~e costs are not identifiable with a
particular cosl objective. they should be
allocated as indirect costs to all benefiting
activities of the organization.
c. Publication and printing costs are
unallowable as direct costs except with the
prior approval of the awarding agency.
d. The cost of page charges in journals is
addressed paragraph Z8.
38. Rearrangement, and alterotion costs.
Costs incurred for ordinary or normal
rearrangement and alteration of facilities are
allowable. Special a,rrangement and
alteration costs incurred speCifically for the
project are allowable with the prior approval
of the awarding agency.
39. Reconversion costs. Costs incurred in
the re,toration or n!habllltatlon of the
organization'. fadlltiea to approximately the
I
A-122:9
same condition existing immediately prior to
commencement of Government awards. fair
wear and tear excepted. are allowable.
40. Recruiting costs. The following
recruiting costs are allowable: cost of "help
wanted" adverti$ing. operating costs of an
employment office. costa of operating an
educational testing program. tra,vel expenses
including food and lodging of employees
while engaged in recruiting personnel. travel
costs of applicant' for interviews for
prospective employment. and relocation COSIS
incurred incident to recruitment of new
employees (see paragraph 41c). Where the
organization uses employment agencies.
costs not in excess of standard commercial
rates for such services are allowable.
41. Relocation costs.
a. Relocation costs are costs incident to the
pemanent change of duty assignment (for an
indefinite period or for a stated period of not
less than 12 months) of an existing employee
or upon recruitment of a new employee.
Relocation costs are allowllblc, subject td the
limitation described in parngraphs b. c. and d.
below. provided that:
(1) The 'move Is for the benefit of the
employer.
(Z) Reimbursement to the employee is in
accordance with an established written
policy conslstenily followed by the employer.
(3) The reimbursement does not exceed the
employee's actual (or reasonably estimated)
expensl!s.
b. Allowable relocation costs for-current
employees are limited to the following:
(1) The costs of transportation of the
employee. members of his immediate family
and his household. and personal effects to the
new location.
(2) The costs of finding a new home. such
as advance trips by employees and spouses
to locate living quarters and temporary
lodging during the transition period. up to a
maximum period of 30 days. including
advance trip time.
(3) Closing costs. such as brokerage. legal.,
and appraisal fees. incident to the disposition
of the employee's former home. These costs.
togelher with those described in (4) below,
are limi ted to 8 per cent of the'sales price of
the employee's former home. '.
(4) The continuing costs of ownership of
the vacant former home after the settlement
or lease date of the employee's new
permanent home. such as maintenance of
buildings and grounds (exclusive of fixing up
expenses). utilities. taxes. and property
insurance.
(5) Other necessary and reasonable
expenses normally incidenl to relocation.
such as the costs of cancelling an unexpired
lease. disconnecting and reinstalling
household appliances. and purchasing
insurance against loss of or damages to
personal property. The cost of cancelling an
unexpired lease is limited to three times the
monthly rentaL
c. Allowable relocation cosls for new
employees are limited to those described in
(1) and (2) of paragraph b. above. When
relocation coats incurred incident to the
recruitment of new employees haVll bean
allowed eitbar as a direct or iRdirect cost and
the employee reeigna for reasORB within hi.&
.
I
Office of Management and Budget Circular A-122 (6/27/80)
control within 12 months after hire. the
organization shall refund or credit the
Government for its share of the cost.
However. the costs of travel to an overseas
location shall be considered travel costs in
accordance with paragraph 50 and not
relocation costs for the purpose of this
paragraph if dependents are not permitted at
the location for any reason and the costs do
not include costs of transporting household
goods.
d. The following costs related to relocation
are unallowable:
(1) Fees and other costs associ~ted with
acquiring a new home.
(2) A loss on the sale of a former home.
(3) Continuing mortgage principal and
in!lI'est payments on a home being sold.
(<I) Income taxes paid by an employee
related to reimbursed relocation costs.
42. Rental costs.
a. Subject to the limitations described in
paragraphs b. through d. of this paragraph.
rental costs are allowable to the extent that
the ra tes are reasonable in light of such
factors as: rental costs of comparable
property. if any; market conditions in the
area; alternatives available; and ihe type. life
expectancy. condition. and value of the
property leased.
b. Rental costs under sale and leaseback
arrangements are allowable only up to the
amount that would be allowed had the
organization continued to own the property.
c. Rental costs under less-than-length
leases are allowable only up to the amount
that would be allowed had title to the
property vested in the organization. For this
purpose. aless-than-anns-!ength lease is one
under which one party to the lease agreement
is able to control or substantially innuence
the actions of the other. Such leases include.
but are not limited to those between (i]
divisions of an organization; (ii) organizations
under common control through common
officers. directors. or members; and (iii) an
organization and a director. trustee. officer.
or key p.mployee of the organization or his
immediate family either directly or through
corpora tions. trusts. or similar arrangements
in which they hold a controlling interest.
d. Rental costs under leases which create a
material equity in the leased property are
allowable only up to the amount that wuuld
be aHowed had the organization purr::hased
the property on the date the lease agreement
was executed; e.g.. depreciation or use
allowances. maintenance. taxes. insurance
but excluding interest expense and other
unallowable costs. For this purpose. a
material equity in the property exists if the
lease in noncancelable or is cancelable only
upon the occurrence of some remote
contingency and has one or lIJore of the
following characteristics:
(1) The organization has the rightlo
purchase the property for a price which at the
beg;nning of the lease appears to be
substantially less than the probable fair
market value at the time it is pennitted to
purchase the property (commonly called a
lease with a bargain purchase option);
(2) Title to the property passes to the
organization at some time during or after the
lease period;
. (3) The tenn of the lease (initialtenn plus
periods covered by bargain renewal options.
If any) is equal to 75 pm' cent or more of the
economic life of the leased property; I.e.. the
period the property Is expected to be
economically usable by one or more users.
43, noyolties and other costs for use of
pat 'f.' and copyrights.
a. J ,yalties on a patent or copyright or
amortization of the cost of acquiring by
purchase a copyright. patent. or rights
thereto. necessary for the proper perfonnance
of the award are allowable unless:
(1) The Government has a license or the
right to free use of the patent or copyright.
(2) The patent or copyright has been
adjudicated to be invalid. or has been
administratively detennined to be invalid,
(3) The patent or copyright is considered to
be unenforceable.
(4) The patent or copyright is expired.
b. Special care should be exercised in
determining reasonableness where the
royalties may have been arrived at as a result
of less then ann's length bargaining; e.g,:
(1) Royalties paid to persons. including
corporations. affiliated with the organization.
(2) Royalties paid to unaffiliated parties.
including corporations. under an agreement
entered into in contemplation that a
Government award would be made.
(3) Royalties paid under an agreement
entered into after an award is made to an
organization.
c. In any case involving a palent or
copyright fonnerly owned by the
organization. the amount of royalty allowed
should not exceed the cost which would have
been allowed had the ol'!:anization retained
title thereto.
44. Severance pay.
a, Severance pay. also commonly referred
to as dismissal wages. is a payment in
addition to re~ular salaries and wages. by
organizations to workers whose employment
is being terminated. Costs of severance pay
are allowable only to the extent that in each
case. it is required by (i) law. (ii) employer-
employee agreement. (Hi) established policy
that con~litutes. in effect. an implied
agreement on the organization's part. or (iv)
circumstances of the particular employment.
b. Costs of severance payments are divided
into two categones as follows:
(1) Actual nonnal trunover severa~ca
J:ayments shall be allocated to all activities;
or. where the organization provides for a
reserve for normal severances such method
will be acceptable if the charge to current
operations is reasonable in light of payments
actual!y made for nonnal severances over a
representative past period. and if amounts
charged arl! allocated to all activities of the
organization.
(2) Abnonnal or mass severance puy is of
such a conjectural nature that measurement
of costs by means of an accrual will net
achieve equity to both parties. Thus. accruals
for this purpose are not allowable. However.
the Government recognizes i!s obligation to
participate to the extent of ;ts fair share. in
any specific payment. Thus. allowability will
be considered on a case-by-case basis in the
event of occurrence.
45. Specialized service facilities.
a. The costs of services provided by highly
I
A-122:10
complex or specialized facilities operated by
the organiza tion. such as electronic
computers and wind tunnels. are allowable
provided the charges for the services meet
the conditions of either b. or c. of this
paragraph and, in addition. take into account
any items of income or Federal financing that
qualify as applicable credits under paragraph
A.5. of Attachment A.
b. The costs of such services. when
material. must be charged directly to
applicable awards based on actual usage of
the services on the basis of a schedule of
rales or established methodology that (i) does
not discriminate against federally supported
activities of the organization. including usage
by the organization for internal purposes. and
(ii) is designed to recover only the aggregate
costs oflhe services. The costs of each
service shall consist normally of both its
direct costs 'ind its allocable share of all
indirect COSLs. Advance agreements pursuant
to paragraph A.5. of Attachment A are
particularly important in this situation.
c. Where the costs incurred for a service
Rre not material. they may be allocated as
Indirect costs.
40. Taxes.
a. In general. taxes which the organization
.s required to pay and whi:;h are paid or
accrued in accordlince with generally
accepted accounting principles. and
payments made to local governments in lieu
of taxes which are commensurate with the
local government services received are
allowable. except for (i) taxes from which
exemptions are available to the organization
directiy or which are available to the
organization based on an exemption afforded
the Government and in the laller case when
the awarding agency makes available the
np,ce~sary exemption certificates, (ii) special
assessments on land which represent capital
improvements. and (iii) Federal income taxes.
b. Any refund oC taxes. and ,my payment to
the organization of interest thereon. which
were allowed as award costs. w"l be
credited either as a cost reduction or cash
refund. as appropriate, to the Government.
47. Terminution costs. Terminatidn of
awards generally give rise to the ir'lcurrelice
of costs. or the need for Specioll treatment of
costs. which would not have arisen had the
aW<Jrd not been terminated. Cosll'rillciples
covering these items are set Corth belew.
They are to be used in conjunction with the
'olhcr provisions of this Circular in
temlin,3tion situations.
a. Common itp.ms. The cust of items
reasonatJly usable on the organization's other
'Nork shall not be a!Iowable unlcss the
organization submits evidence Ihat if would
not re!ain such items at cost without
sustaining a loss. In deciding whether such
items are reasonably usable on uther work of
the organiza lion. the awanJil~g agency shOUld
consider the organization's plans and orders
for current and scheduled acllvily.
Contemporaneous purch<Jses of common
items by the organization shall be regarded
as evidence that such items are reasonably
usable on lhe organization's other work. Any
acceptance of common items as allocable to
the terminated portion of the award shall be
limited to the extent that the quantities oC
.
I
Office of Management and Budget Circular A-122 (6/27/80)
such items on hand. in transit. and on order
are in excess of the reasonable quantitative
reql1.iremenu of other work.
b. Costs continuing after termination. U iD
a particular case. despite all reasonable
efforts by tha organization. certain costs
cannot be discontinued immediately after the
effective date of termination. such cosu are
generally allowable within the limitations set
forth i:1 this Circular. except that any such
costs continuing after termination due to the
negligent or wi,IlIuJ failure of the organization
to discontinue such costs shall be
unallowable. '
c. Loss of useful value. Loss of useful value
of sredaltooling. machinery and equipment
wb:,,:h was not charged to the award as a
C3;,ital ~xpenditure is generally allowable if:
i : i Such special tooling, machinery, or
eq :pmant is not reasonably capable of use in
!b:. dher work of the organization.
(::1 The interest of the Government is
ll!'l" 'Jr:ti!d by transfer of title or I:y other
n1l'"ns deemed appropriate by the awarding
a:,)' ncy;
d. Rental casts, Rental costs under
u;:r,xpired leases are generally allowable
....:.ere clearly shown to have been
rl'.:~onably necessary for the performance of
It,,, tenninated award less the residual value
0:' such leases. if (i) the amou..,t of such rental
Cilsimp.d does not exceed the reasonable use
vabe of the property leased for the period of
tr.,; aWJrd and such further period as may be
rp..:.;IJl:,;ble, and' (ii) the organization makes
all reasonable efforts to terminate, assign.
sellle. or otherwise reduce the cost of such
lease. There also may be included the cost of
alterations of such leased property, provided
such al:erations were necessary for the
performance of the award. and of reasonable
restor(ltion required by the provisiona of the
len~e.
e. Selllement expenSBS, Settlement
expenses including the Collowing an>
gem'rally allowable:
(1) Accounting. legaL clerical, and similar
costs reasonably nec~ssary for.
(a) The preparation and presentation to
awarding agency of settlement claims and
supporting data with respect to the .
terminated portion of the award. unless the
termination is for default (See paragraph 4.8.
of Attachment 1- OMB C1rcuIar No. A-llO;
and
(b) The termination md sattlement of
subawa~.
(2) Reasonable' costs Cor the storage.
transportation. protection. and disposition of
property provided by the Government or
acquired or produced for the award: except
when grantees are reimbursed for disposals
at a predetermined amount in accordance
with Attachment N of OMB Circular A-llO.
(3) Indirect cosls related 10 sillaries and
wages inClllTed as settlement expel14es in
subparagraphs (1) ,snd (2) of th.ia paragraph.
Normally, such indirect cosu shall be limited
to fringe beneiiu, occupancy cost. and
immediate supervision.
f. Claims under subawards, Claims under
subawards, including the allocable portion oC
claims which are common to the award. and
to other work of the organization are
generally allowable. An appropriate share of
the organization's indirect expense may be
allocated to the amount of settlements with
subcontractor/subgranteel; provided that the
amount allocaled is otherwise consistent
with the basic guidelines contained iD
Attachment A. The indJrect expense so
allocated shall exclude the same and similar
costs claimed directly or indirectly as
settlement expenses.
48. Training and eduCI:Jt.ion C08ts.
a. Cosu of preparation llDd maintenance of
a program of instruction including but not
limited to on-the-job. classroom. and
apprenticeship training. designed to increase
the vocat1onal effectiveness ol employees,
including training material.. textbooks.
salaries or wages of trainees (excluding
overtime compensation which might arise
therefrom). and (i) salaries of the director of
training and staff when the tra.in.ing program
is conducted by the organization: or (il)
tuition and fees when the training is in an
institution nnt operated by the organization.
are allowable.
b. Costs of part-time education. at an
undergraduale or postgraduate college leveL
including that provided at the organization's
own facilities. are allowable only when the
course or degree pursued is relative to the
field in which the employee is now working
or may reasonably be expected to work. and
are limited to:
(1) Training materials.
(2) Textbooks.
'(3) Fees chargelt by the t1ducatiunal
institution.
(4) Tuition charged by the educational
institution. or in lieu of tuition. instructors'
salaries and the telated share of indirect
costs of the educational institution to the
extent that the sum thereof is nol in excess of
the tuition which would have ben paid to the
participating educalional institution.
(5) Saiaries and related costs 'of instructors
who are employees of the organizatioa.
(6) Straight-lime compensation of each
employee for time spent attending c1usM
during working hours oot in sxcess of 156
hours per year and only to the extent that
circumstances do not permit the operation of
classes or attendance al classes afler regular
working hours: otherwise such compensation
is unallowable,
c. C.Jsts of tuition. !ees. traini.!lg materials,
and textbooks (but not subsistence, salary. or
any other emolumenu) in connection with
full-time education. including that provided at
the organization's own facilities, at a
postgraduate (but not undergraduate) college
leveL are allcwable only when the course or
degree pursued is related 10 the field in which
the employee is now workinS or may
reasonably be expected to work. and only
where the cosu receive the prior approval of
the awarding agency. Such costa are limited
to the costs attributable to a total period not
to excee:! one school year Cor each employee
so trained. In lUlusual cases the period may
be extended.
d. Costs of ettendance of up to 16 weeks
per employee per year at specialized
program. specifically designed to enhance
the effectiveness of executives or managers
or to prepare employees for such positions
are allowable. Such costs include enrollment
I
A-122:11
fees, training materials, textbooks and
related charges, employees' salaries.
subsistence. and traveL Cosu allowable
under this paragraph do not include those for
courses that are part of a degree-<<:iented
curriculum. which are allowable only to the
extent set forth in b. and c. above,
e. Maintenance expense. and normal
depreciation or fair rentaL on facilities
owned or leased by the organization for
training purposes are allowable to the extent
set forth in paragraphs 9, 22. and 42-
f, Cuntributions or donatiolU to
educational or training institutiOlU, including
the donation of facilities or other properties.
a nd scholarships or fellowships, are
unallowable.
g. Training and education cosu in excess oj
those olherwise allowable under paragraphs
). and c. of this paragraph may be allowed
with prior approval of the awarding agency.
To be considered for approval, the
organization must demonstrate that such
costs are consistently inCUlTed pursuant to ao
established training and education program.
and that the course or degree pursued is
relative to the field in which the employee is
now working or may reasonably be expected
to work.
49. Transportation casts. Transportation
ClJsts include freight, express, cartaga. and
postage charges relating either to goods
purchased. in process, or delivered. These'
costs are allowable. When such costs can
readily be identified with the items involved.
(hey may be directly charged as
transportation cosu or added to the cost of
such items (see paragraph 23), Where
identification with the materials received
cannot readJly be made, transportation costs
may be charged to the appropriate indirect
cost accounts if the organization follows a
consistent, equitable procedure in this
respe~t.
SO. Travel costs,
a. Travel costs are the expenses for
transportation, lodging. subsistence. and
related items inCUlTed by employees who are
in tra vel staha on official business of the
organization. Travel cosls are allowable .
subject to paragraphs b. tHrough e. below,
when they are directly attributable to specific
work under an award or<U'e incurred in the
nonnal course of administration of the
organization.
b, Such costs may be charged on an actual'
b~sis. on a per diem or mileage basis in lieu
of actual cosu incurred. or on a combination
of the tWo, proTided the method used results
in charges consistent with those normally
allowed by the organization in its regular
opera tions.
c. The difIerence in cost between firsH:lass
air accommodations and less than first-class
air accommodations is unallowebls except
when less than first-class air
accommodations are not reasonably
available to meet necessary mission
requirements, such as where less than first.
class accommodations would (i) require
circuitous routing. (i1) require travel during
unreasonable hoW'1l, (Hi) greatly increase the
duration' of the flight, (iv) result in additional
costs which would offset the transportation
savings. or (v) offer Ilccommodationa which
~
1----
Office of Management and Budget Circular A-122 (6/27/80)
are not reasonably adequate for the medical
needs of the travelet'.
d: Necessary and reasonable costa of
family movements and personnel movementa
of a special or mass nature are allowablll,
pUllluant to paragrepha 40 and 41. subject to
allocation on the basis of work or time period
benefited when appropriate. Advance
agreements are particularly important.
e. Direct charges for foreign travel costs are
allowable only when the travel has received
prior approval of the awarding agency, Each
separate foreign lrip must be approved. For
purposes of this provision. foreign travel is
defined as any travel outside of Canada and
the United States and its temtories and
possessions. However. for an organization
located in foreign countries. the term "foreign
travel" means travel outside that country,
[Circular.No, A-l22)
Attachment C
Nonprofit Organizations nol Subject to this
C:rcular
Aerospace Corporation. E1 Segundo.
California
Argonne Universities Association. Chicago.
Illinois
Associated Universities. Incorporated.
Washington. D.C.
Associated Universities for Research and
Astronomy. Tucson. Arizona
Atomic Casualty Commission. Washington.
D.C.
Baitelle Memorial Institute. Headquartered In
Columbus, Ohio
Brookhaven National Laboratory. Upton.
New York
Center for Energy and Environmental
Research (CEER). (University of Puerto
Rico)
Commonwealth of Puerto Rico. Charles Stark
Draper Laboratory. Incorporated
Cambridge. Massachusetts. Comparative
Animal Research Laboratory (CARL)
(University of Tennessee). Oakridge,
Tennessee
Environmentallnstitute of Michigan. Ann
Arbor, Michigan
Hanford Environmental Health Foundation.
Richland, Washington
UT Research Institute. Chicago. illinois
Inlltitute for Defense Analysis, Arlington.
Virginia
Institute of Cas Technology. Chicago, Illinoia
Midwest Research Institute. Headquartered
in Kunsas City. Missouri
Mitre Corporation. Bedford. Massachusetts
Montana Energy Researcl1 and Development
Institute. Ine.. (MERDI). Butte, Montana
National Radiological Astronomy
Observatory. Creen Bank. West Virginia
Oakridge Associated Universities. Oakridge.
Tennessee
Project Management Corporation, Oakridgll,
Tennessee
Rand Corporation. Santa Monica. California
Research Triangle Institute, Research
Triangle Park. North Carolina
Riverside Research Institute, New York. NeW'
York
Sandia Corporation. Albuquerque, New
Mexico
Southern Research Instituta. BfrmJDgham,
Alabama
Southwest Research Inatitula. San Antonio,
Texas
SRI International. Menlo PiuX. CalltomJa
Syracuse Research Corporatioa, Syracuae.
New York
Universities Research Association.
Incorporated (National Acceleration Lab),
Argonne. Dlinois
Universities Corporation for Atmospheric
Research, Boulder, Colorado
Nonprofit Insurance Companies such 811 Blue
Cross and Blue Shield Organizations
Other nonprofit organizations 811 negotiated
with awarding agencies.
(FR Doc. ~ FIled 7-7-<<1: 8:45 ."1
8lUJHG COOE 311l1-01-M
Editorial Corrections to
OMS A-122
OFFICE OF MANAGEMENT AND
BUDGET
Circular A-122, "Cost Principles for
Nonprofit Organizations"; Correctlon
AGENCY: Office of Management and
Budget.
ACTION: Final policy correction.
SUMMARY: This notice corrects errors in
the printing of cost principles for
nonprofit organizations. (45 FR 46022.
July 8. 1980).
FOR FURTHER INFORMATION CONTACT:
Palmer Marcantonio, Financial
Management Branch. Office of
Management and Budget, Washington.
D.C, 20S03, (202) 395-4773.
· Page 46022. column 2 the second
Paragraph 1. change Paragraph 5
"Compensation for Personnel Services"
to Paragraph B.
. Page 46022. column 2 the second
Paragraph 2. change Paragraph 6
"Contingencies" to Paragraph 7.
. Page 46022. column 3:
Paragraph 4, change Paragraph 31,
"Equipment and Other Capital
Expenditures" to Paragraph 13.
· Paragraph 5, change Paragraph 26
"Meetings" to Paragraph 24.
· Paragraph 6, change Paragraph 27.
"Organization Costs" to Paragraph'2B.
· Paragraph 7. change Paragraph 30
"Page charges in Professtionallournals"
to Paragraph 28.
· Paragraph 8. change paragraph 37
"Public Infonnation Service Costs" to
Paragraph 3B.
· Paragraph 9. change Paragraph 43
"Rental Costs" to Paragraph 42.
· Paragraph 9a: in the fourth line. add
"up" between the words "only" and
"to": in the sixth line change "they" to
"it" .
· Paragraph 10. change Paragraph 51
"Travel Costs" to Paragraph SO.
-lun
A-122:12
· Page 48024, column 3 Paragraph
4(a)(2) after "benefits received" add ";
or".
· Page 46025. column 1 Paragraph B3.
change the reference. "Paragraph 21 of
Attachment 8" to "Paragraph 19 of
Attachment 8."
· Page 46026. cofumn 1 Paragraph
4a.iii, in the sixth line. change "direct
cost" to "direct costs,"
· Page 46026, column 2 Paragraph
Ele, change "establishment of a rate" to
"establishment of a final rate."
. Page 46026. column 3 Paragraph
E2b, in the third line add the following
after "a Federal agency shall"-"submit
its initial indirect cost proposal
immediately."
. Page 46027. column 3 Paragraph
. (3)(a). change "workmen's
compensation" to "workerp'
compensation."
. Page 46028. column 1 Paragraph
Bf3(b), (the second line of column 1)
change "Workmen's compensation" to
"workers' compensation."
· Page 48030. .column 3. paragraph
24b., the sixth line. change "allowable"
to "allowability".
Daniel F, Mann,
Budget and Management Officer.
IFR Doc. 81-1lO73 Flied 3-18-81: 8:45 oml
81WHG CODE 311l1-01-M
Circular A-122, "Cost Principles for
Nonprofit Organizations"
Correction
In FR Doc. 81-20270. appearing at
page 46022 in the issue of Tuesday, July
8, 1980, the following changes should be
made:
1. On page 46024. column tnree, the
second sentence in paragraph 'A.s,b.
should read. "Specifically, the concept
of netting such credit items against:
related expenditures should be applied
by the organization in determining the
rates or amounts to be charged to
Federal awards for services rendered
whenever the facilities or other
resources used in providing such
services have been financed directly. in
whole or in part. by Federal funds."
2. On page 46024. column three, the
second complete sentence in paragraph
A.B. should read. "This is particularly
true in connection with organizations
tha t receive a preponderance of their
support from Federal agencies."
3. On page 46025. column one.
paragraph 8.2, should read. "2. Any
direct cost of a minor amount may be
treated as an indirect cost for reasons of
practicality where the accounting
treatment for such cost is consistently
applied to all final cost objectives."
\.
~
I
Office 01 Management and Budget Circular A-122 (6/27/80)
4. On page 48025. column one.
paragraph B.4.f. should read. "f.
Administration of group benefits on
behalf of members or clients including
life and hospital insurance. annuity or
retirement plans. financial aid. etc,"
5. On page 48025, column two. the first
sentence in paragraph D.1.e. should
read. "The base period for the allocation
of indirect costs is the period in which
such costs are incurred and accl,!mulated
for allocation to work performed in that
period. "
6. On page 46026, column one. the
second sentence in paragraph 0.3.d
should read. "The costs in the common
pool shall then be distributed to
individual awards included in that
function by use of a single indirect cost
rate."
7. On page 46026, column one, the first
sentence in paragraph 0.3.e. should
read, "The distribution based used in
computing the indirect cost rate for each
function may be lotal direct costs
(excluding capital expenditures and
other distorting items such as major
subcontracts and subgrants), direct
salaries and wages, or other base which
results in an equitable d'istribution,"
8. On page 46026. column one. the first
and second sentences- in paragraph
0.4.a. should read. "Some nonprofit
organizations treat all costs as direct
costs except general administration and
general expenses. These organizations'
generally separate their cosls inio three
basic ca tegories:' . .,'.
9. On page 46026, the last sentence in
column one (extending to column two).
in paragraph 0.5. should read, "The
factors may include the physical
location of the work. the level of
administrative support required, the
nature of the facilities or other resources
employed, the scientific disciplines or
technical skills involved, the
organizational arrangements used. or
any combination thereof."
10. On page 46026. column three,
paragraph E.2.L should read, "L To the
. extent that problems are encountered
among the Federal agencies in
connection with the negotiation and
approval process. the Office of
Management and Budget will lend
assistance as required to resolve such
problems in a timely manner,"
11. On page 46030. column one, the
introductory text of paragraph 16.b. and
paragraph 16.b.(1) should read, "b. The
costs of idle facilities are unallowable
except to the extent that: (1) They are
necessary to meet fluctuations in
workloads: or".
12. On page 46030, column one. the
second sentence in paragraph 16.c.
should read. "Such costs are allowable,
provided the capacity is reasonably
anticipated to be necessary or was
originally reasonable and is not subject
to reduction or elimination by subletting,
renting. or sale, in accordance with
sound business. economics or security
practices,"
13. On page 48031. second column,
paragraph 34.c. should read, "In addition
to the factors in paragraph b. above.
retainer fees to be allowable must be
supported by evidence of bona fide
services available or rendered."
BlLUNO COOE 1505-41-M
I
A-122:13
"I