AGREEMENT-COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM
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AGREEMENT FUNDED UNDER
THE CLEARWATER COMMUNITY DEVELOPMENT
BLOCK GRANT PROGRAM
THIS AGREEMENT ~s entered into as of the 1st day of October, 1988, by the
CITY OF CLEARWATER, Florida, a political subdivision of the State of Florida,
hereinafter referred to as the "CITY", and QUEST INN, INC., as further
identified in Appendix A, hereinafter referred to as the "PSA", and included
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 Development Act of 1974, as amended, hereinafter
called the "Act", and
WHEREAS, the Planning & Urban Development Department, hereinafter called
the "Department", will act ~n behalf of the City in conducting the Program,
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and
WHEREAS, the PSA provides a program as identified ~n Appendix A of
benefit to low and moderate income residents within the City of Clearwater and
proposes to perform the work and carry out the specific services as identified
in Appendix A; hereinafter referred to as the "Project", and desires federal
financial assistance through the City to effect this proposal, and
WHEREAS, the City finds the project to be meritorious and in fulfillment
of the purposes of the Act;
THEREFORE, the parties agree as follows:
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1. The PSA shall, ~n 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, 1988, and
terminate on September 30, 1989, unless earlier cancelled as provided herein.
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
Manager.
The need and merit shall be at the determination of the Manager.
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 nature to affect cost or period of
performance.
3. The City representative with the PSA as regards conduct of serv~ces
under this contract shall be the Community Development Manager and the PSA's
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serv~ces shall be carried out under the supervision of the Agent as identified
~n Append ix A.
4. The PSA shall not exceed its budgeted amount and shall use the funds
~n accordance with the award to be paid with Community Development Funds
inc luded in Appendix B.
Funds shall not 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-llO,
provided in Appendix G, and with the provisions of OMB Circular 122, provided
~n Appendix H, or the appropriate successor documents of these documents.
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 subcontrac tors under this agreement shall be approved by the
City.
7. All purchases of consumable, capital equipment and serv~ces shall be
~n conformity with the Procurement Standards set forth in OMB Circular A-110,
At tachment o.
Accountability for project property and equipment shall be ~n
accordance with the requirements therein set forth.
8. The City agrees to make payment of budgeted costs on a reimbursement
basis.
Requests for payment shall be as specified in Attachment B.
No
advance payments shall be made to the PSA. All costs and invoices for request
for payment shall be supported by properly executed payrolls, time records,
invoices, contracts, or vouchers, or other official documentation evidencing
~n 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 by clearly identified
and readily accessible.
Final reques t for reimbursement hereunder 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 day period.
9. The PSA shall upon the expiration of this agreement transfer to the
city any CDBG funds on hand and any accounts receivable attributable to the
use of CDBG funds.
Program income funds are excluded from this provision or
as provided below.
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Program income funds shall be retained by the PSA so long as the
activities that will be undertaken with the program ~ncome are the specific
activities that meet the prov~s~ons of this agreement.
These funds shall be
adjusted by the City according to the principles described in paragraphs
(b)(2)(i) and (ii) of Section 570.504 which states that:
(1) Program income in the form of repayments to, or interest earned on a
revolving fund as defined ~n Section 570.500(b) shall be substantially
disbursed from the fund before additional cash withdrawals are made from the
u.s. Treasury for the same activity.
(This rule does not prevent a lump sum
disbursement to finance the rehabilitation of privately owned properties as
provided for ~n Section 570.513.)
(2) Substantially all other program income shall be disbursed for
eligible activities before additional cash withdrawals are made from the u.S.
Treasury.
10. The City shall retain custody upon termination this agreement of any
and all property purchased with Community Development Funds.
"Property" as
used ~n this Paragraph shall mean nonexpendable tangible property valued at
$200 or more with a remaining life expectancy of one year or more.
The PSA
shall retain custody of property acquired wi th 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 Report.
Stolen, los t 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 ~n 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 used 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, trans ferred, ass igned, or loaned by the PSA wi thout pr~or
written consent of the City.
11. For any real property under the PSA's control that was acquired or
improved in whole or in part with CDBG funds in excess of $25,000 must;
(1) Be used to meet one of the national objectives in Section 570.901
until five years after expiration of the agreement, or for such longer period
of time as determined to be appropriate by the recipient; or
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(2) Disposed of ~n a manner that results ~n the recipient's being
reimbursed in the amount of the current fair market value of the property less
any portion of the valued attributable to expenditures of non,-CDBG funds for
acquisition of, or improvement to, the property. (Reimbursement ~s not
required after the period of time specified in paragraph (b)(8)(i) of Section
570.503.10.
12. Nothing ~n this agreement shall be construed to permit invasion of
the pr~vacy 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 ~n such a way as to invade individual pr~vacy and client
relationships, unless Florida law pertaining to public records requires
disclosure of said information.
13. 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.
14. The PSA agrees to fully participate ~n the implementation and
maintenance of an evaluation system to continually monitor the project. This
shall include, but not be limited to, periodic submission of data reports
which will be used by the Department for inc Ius ion ~n the Annual Grantee
Performance Report,
periodic monitoring visits by the Department for
conformance wi th this agreement, and cont i nui ng asses sments of performance
hereunder. PSA agrees to comply with evaluation and information requirements
of the Department.
A final report shall be submitted by the PSA within 30
days after the end of the contract term. This final report shall consolidate
reporting of all project participants.
15. PSA shall establish and maintain on an accrual basis an accounting
system ~n accordance with the Standards of Grantee Financial Management System
as set forth in OMB Circular A-110 or the appropriate successor document and
~n accordance with generally accepted accounting principals and standards
where these principals and standards are not in conflict with A-110 or its
successor. PSA agrees to modify or correct said systems in accordance with he
City's requirements.
16. 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
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records shall be available for audit, inspection or copy~ng 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 reasonably 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 inc lude financial records, audi ts, support ing documents,
statistical reports and client files.
PSA will comply with such additional
requirements as to maintenance of records as the City may request 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.
17. 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.
18. The PSA shall not assign any interest ~n this Agreement without the
prior written consent of the City.
19. The city may suspend, withhold, or terminate payment of the project,
~n whole or in part, for cause or convenience.
Cause shall inc luded the
fo llowing:
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 ~n 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.
f. Convenience shall be according to the regulations in 24 CFR
85.43 and 85.44.
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.
20. Both parties will use their best efforts to ensure that serv~ces
under this Agreement are provided so as to best meet the needs of residents
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with priority to those residents who reside ~n 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
~nc ome.
21. No person with responsibilities ~n the operation of the project will
discriminate with respect to any project participant because of race, color,
national or~g~n, 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 ~n Other
Program Requirements in Appendix D, (CFR 570.601).
22. The PSA will establish safeguards to prohibit employees from us~ng
their positions for a purpose that ~s or g~ves the appearance of being
motivated 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 a new public services not covered by this Agreement, the PSA
shall atLempt to secure other local, state or federal funding andlor 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 ~n the area of its operation, and will, ~n 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.
23. The PSA shall comply with the requirements of Section 3 of the
Housing and Urban Development Act of 1968, as amended, and the HUD regulations
issued pursuant thereto, attached hereto as Appendix E.
24. The PSA will comply with Equal Employment Opportunities Executive
Order 11246, as amended, attached hereto as Appendix F.
25. 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 Implementation of the Lead-Based Paint Poisoning Prevention Act;
Clean Air Act;
Historic Preservation Requirements of P.L. 89-656
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Archeological and Historic Preservation Act of 1974;
Executive Order 11593;
Architectural Barriers Act of 1968;
Ha t c h Ac t ;
Federal Water Pollution Control Act,
Federal Labor Standards prov~s~ons and the Davis-Bacon Acti
The Civil Rights Act of 1964;
National Flood Insurance Program;
all as amended from time to time and in effect during the term this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this agreement to be
executed as of the day and year first above written.
QUEST INN, INC.
BY~
P esident
AT~ (! iZd: /
~;"""";"" secretar;3
CITY OF CLEARWATER, FLORIDA
Countersigned:
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C~ty Manager
By
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ATTEST:
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Approved as to form & correctness:
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Agency: Quest Inn. Inc.
Year: 1988 - 1989
Appendix A
Identification of ARencv and Specific Services to be Provided
Name:
Quest Inn. Inc.
Legal Classification: A non-profit corporation organized and existing under
the laws of the State of Florida.
Principal Office
509 North Fort Harrison Avenue in
Clearwater, Florida. 34615
the City of
Mailing Address:
P.O. Box 10071
Clearwater. FL 34617
Agent:
Suzanne Bissett. Director
813-443-2067
ProRram of ARencv
Provides temporary emergency housing primarily for young. single adults. Also
provides some food. clothing. and counseling. May occasionally accept
couples and families-on an exceptional basis.
Specific services to be provided under this ARreement
I. Site Improvement
The function and appearance of the Quest Inn physical facility will be
improved by replacing the existing sign with a sign that fully meets the new
city sign code; by landscaping with shrubs. trees. and other plants as
appropriate; by upgrading the lawn and driveway/parking surface as
appropriate; by upgrading fencing if necessary; and similar exterioroJ::c
visible improvements as needed.
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Agency: Quest Inn. Inc
Year: 1988 - 1989
Appendix B
Pro;ect Award
Support for physical improvements to the Quest Inn facility as noted in
appendix A will be provided up to a total of $3,000.00.
TOTAL
$3,000.00
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APPENDIX C
METHOD OF PAYMENT
All payments shall be on a reimbursement basis only.
All requests for reimbursement shall be supported by proper invoices,
payrolls, checks, receipts and other documentation as required.
Any program income shall be submitted to the CITY through the DEPARTMENT at
least Quarterly. Fees collected, if any, shall be reported but are not to be
construed as program income.
Requests for reimbursement shall not be reduced by any program income
received.
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subpart K-0ther Program
Requirements
~ 570,&00 General
(0) Section l04(b) tf the Act provides
that any grant under Hection 106 of the
Act shall be u. ,c' oly if the grantee
certifies to the satisfaction of the
Secreta'ry, among other things, that the
grllnt "wili b'e.conducted and
administered in conformity with Pub. L
88-352 and Pub. L. 90-284," and, further,
that the grantee "will comply with the
other provisions of this title and with
other applicable laws:: SectioD l04(d)(l)
of the Act requires that the Secretary
dt:termine with respect to grants made
pursuant to section l06(b) (Entitlement
Grants) and 106(d)(2)(B) (HUD-
Administered Small Cities Grants), at
least on an annual basis, among other
things. "whether the grantee has carried
outlits] certifications in compliance
with the requirements and the primary
objectives of this title and with other
applicable laws. . . ." Certain other
statutes are expressly made applicable
to activities assisted under the Act by
the Act itself. while other laws not
referred to in the Act may be spplicable
to such activities by their own tenns.
Certain statutes or Executive Orders
which may ue applicable to activities
assisted under the Act by their own
terms are administered or enforced by
governmental departmenLs or agencies
other than the Secretary or the
DepartmenL This Subpart K enumerates
laws which the Secretary will treat as
applicable to grants made under section
106 of the Act, other than grants to
APPENDIX D
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OTHER PROGR&~ REQUIRE~lliNTS
States made pursuant to section l06(d)
of the Act. for purposes of the
determinations described above to be
made by the Secretary under section
l04(d)(l) of the Act, including statutes
expressly made applicable by the Act
and certain other statutes snd Executive
Orders for which the Secretary has
enforcement responsibility. The absence
of mention herein of any other ststute '
for which the Secretary docs not have
direct enforcement responsibility is not
intended to be taken as an indica tion
tha t. in the Secretary's opinion. such
statute or Executive Order Is not
applicable to activities assisted under
the Act. For laws which the Secretary
willlreat as applicable to grants made
to Stales under section 100(d) of the Act
for purposes of the determination
required to be made by the Secretary
pursuant to section 104(d)(2) of the Act,
see A 570.496.
(b) This Subpart also sets forth certain
additional program requirements which
the Secretary has determined to be
applicable to grants provided under the
Act as a mailer of administrative
discretion.
(c) In addition to grants made
pursuant to section 100(b) and
106(d)(2)(B) of the Act (Subparts D and F
of this Part, respecti,)'ely). 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 8&-352 and Pub. L 9<l-
284; Executive Order 11063-
Section l04(b) of the Act provides that
any grant under section 100 of the Act
s,hall be made only if the grantee
ce'rtifies to the satisfaction of the
Secretary that the grant "will be
conducted and administered in
conformity with Pub. 1.. 88-352 and Pub.
L. 9(}.284." Similarly, section 107
provides that no grant may be made
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under that.ection (Secretary'.
Discretionary Fund) or .ection 119
(UDAG) withoutl8lisfsctory assurances
to'the same effect.
(aJ "Pub. 1.. ~52" refera \0 Tille VI
of the Civil Rights Act of 1004 (42 U.S.C.
200(ki et ,eq.), which provide. that no
person In the United States shall on the
ground of race, color. or national origin,
be excluded from participation In. be
denied the benefit. of. or be .ubjected to
discrimination under any program or
acllvlty receiving Federal financial
assistanca, Section 602 of the Civil
Rights Act of 1004 directs each Federal
department and agency empowered to
extend Federal financial 88sistance to
any program or activity by way of grant
to effectua te the foregoing prohibition
by issuing rules, regulations, or orders of
general applicability which shall be
consislent with achievement of the
, statule authoriting the financial
assistance. HUlJ regulallons
implementing the requirements of Title
VI with respect to HOO programs are
contained in 24 crn Partl.
(b) "Pub, 1.. 9(}.284" refers to Title VllI
of the Civil Rights Act of 1968 (42 V.S.C.
3U01 ~t seq.). popularly known as the
Fair Housing Act. which provides that it
is the policy of the United Sta les to
provide, within constitutional
limitations, for fair housing throughout
the United State. and prohibits any
person from discriminating in the sale or
rental of housing, the financing o[
housing, or the provision of brokerage
services. Including in any way making
unavailable or denying a dwelling to
any ,person. because of race, color,
religion. sex. or na tional origin, Ti tie
VllI further requires the Secretary to
administer the programs and activities
relating to ho~sing and urban
deveJopmentln a manner affirmatively
to further the purposes of Title VIII.
Pursuant to this statutory direction, the
Secretary requires that grantees
administer all programs and activities
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related to housing and community
developmllnt in a manner to
affinnnlively furlher fllir housing.
(c) Executive Order 11003, as
amended by Executive Order 12259,
directs the Department to toke all action
necessary and appropriate to prevent
discriminotion because of race, color.
religion (creed), aex, or national origin.
in the sole, leosing, renlal. or other
disposition of residentiol property and
related facilities (including land to be
developed for residential use). or in the
use or occuponcy thereof. if auch
property ond related focilities are,
omong other things. provided in whole
or in part with the oid of loans,
advances, grants, or contributions
ogree\l.to be made by the Federal
Government. I-IUD regulations
implementing Executive Order 11003 are
contained in 24 CFR Part 107,
~ 570.602 Section 109 of the Act.
(a) Section 1~ of the Act requires that
no person in the United States shall on
the ground of race, color. national origin
or sex. be excluded from participation
in. be denied the benefits of. or be
subjected to discrimination under, any
program or activity funded in whole or
in part with community development
funds made available pursuant to the
Act For purposes of this section
"program or activit{' is defined as any
function conducted by an identifiable
administrative unit of the recipient or
by any unit of government, subrecipient.
or priva te contractor receiVing
community development funds or loans
from the recipient "Funded in whole or
in part with community dev'elcpment
funds" means that community
development funds in any amount in the
form of grants or proceeds from HUD '
guaranteed loans have bee!;\,transferred
by the recipient or 8 subrecipient to an
identifia ble administrative unit and
disbursed in a program ;::r activity,
(b) Specific discriminatory actions
prohibited and correctil'e actions.
(l) A recipient may not. under any
program or activity to which the
regulations of this Pari may apply
directly or through contractual or other
llrrangr.ments, on the ground of rllce,
color. na lional origin, or sex:
(i) Deny allY facilities, services,
financial Rid or other benefits provided
under the program or activity.
(ii) Provide ony facilities. services,
financial aid or other benefits which are
different. or are provided in a different
form from thut provided to others under
the program or activity.
(iii) Subject to segrcga ted or sepora te
treatment in ony fllcility in, or in any
ma tter of process rei a tl!d to receipl of
any service or benefit under the program
or activity.
(iv) Restrict in any way access 10. or
in the enjoyment of any advantage or
privilege enjoyed by others in
connection with facilities, services,
financial aid or other benefits under the
program or aclivity,
(v) Treat an individual differently
from others in determining whether the
individual satisfies any admission,
enrollment. eligibility. membership, or
other requirement or condition which
the individual must meet in order to be
provided any facilities. services or other
benefit provided under the program or
activi:v.
(vi) Den)' an opportunity to participate
in a program or activity as an employee.
(2) A recipient may not utilize criteria
or methods of administration which
have the effect of subjecting individuals
to discrimination on the basis of race.
color. national origin. or sex. or have the
effect of defeating or substantially
impairing accomplishment of the
objectives of the program or activity
with respect to individuals of a
particular race, color. national origin, or
sex:.
(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, or
sex: or which have the purpose or effect
of defcoting or s\lbstontiall)' impairing
the accumplishment of the objectives of
the Act Rnd of this section.
(4)(i) In administering a program or
activity funded in whole or in part with
CD8G funds regarding .....hich the '
recipient has previously discriminllted
Dgainst persons on the ground of race.
color. nlltional origin or sex. the
recipient must toke affinnalive action to
overcome the effects of prior
discrimina lion,
(ii) E\'en in the absence of such prior
discrimination. a recipient in
administering a program or activity
funded in whole or in part with CDBG
funds should take affirmative action to
overcome the effects of conditions
which would otherwise resull in limiting
participation by persons of a particular
race, color, national origin or sex.
Where previous discriminatory practice
or usage tends, on the ground of race,
color. national origin or sex, to exclude
individuals from parlicipa tion in, to
deny them the benefits of. or to subject
them to discrimination under any
program or activity to which this part
applies, the recipient has an obliglition
to take reasonable action to remove or
overcome the consequences of the prior
discriminatory prllclice or usage. and to
accomplish the purpose of the Act
(iii] A recipient shall not be prohibited
by this part from taking any action
eligible under Subpart C to ameliorate
an imbalance in services or facilities
provided to any geographic area or
specific group of persona within its
jurisdiction. where ,the purpose of such
action in to overcome prior
discriminatory practice or usage.
(5) Notwithstanding anything to the
contrary in this section, nothing
conlained herein shall be construed to
prohibit any recipient from maintaining
or constructing separate living facilitie~
or rest room facilities for the different
sexes. Furthennore. selectivity on the
basis of sex is not prohibited when
inslitutional or cllstodial serVices can
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APPENDIX E
SECTION 3 CLAUSE
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THE FOLLOWING SECTION 3 CLAUSE SHALL gE INCLUDED IN ALL CONTRACTS FUR WORK IN
CONNECfION WITH A SECfION 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 cant ract. The
parties to this contract certify and agree that they are under no contractural
o~ other disability which would prevent them 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 will not subcontract with any subcontractor
where it has notice or knowledge that the latter has been found 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.
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APPENDIX F
NOTICE ~ REQUIREMENT FOR AFFIRMATIVE ACtION
TO ENSURE EQUAL EMPLOYMENT OPPORTUNITY
(EXECUTIVE ORDER 11246)
1. The Offeror's or Bidder's attention is called to the "Equal Opportunity
Clause" and the "Standard Federal Equal 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
Timetable
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 Mar. 31, 1981. . . . 6.9
B. Goals for Minority Utilization:
TAMPA-ST. PETERSBURG, FIA., AREA
Area covered: Hillsborough, Pasco, and Pi~ellas
Counties, Fla.
Goals and Timetablesl
Trade
Goal
(percen t)
All. . . . . . . . . . . . . . . . . . . . . .. . . .
17.9
lFor 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 9pecificationJ set forth in 41 CFR 60-4.3(a), Ind its 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 0f 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 o~ 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 subcontract7
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 Pinellas 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 employment because of race, color, religion, sex, or national origin.
The contractor will take affirmative a~tion to ensure that applicants are
employed, and that employees are treated during employment wi~~out :::-egard
to their race, color, religion, seX, or national origin. Such action shall
include, but not be limited to the following: Employment, upg~ading,
demotion, or transfer; recruitment or recruitment advertising; layoff or
termination, rates of payor other forms of compensation; and selection
for training, including apprenticeship. The cont!'actor 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 advertisertents 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
~derstanding, 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 fo:::- employment.
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4. The contractor wil~COmplY with all provisions of Exlcutive Order 11246
of September 24, 1965, and of the rules, regulations, and relevant orders
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. ~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
even~ a contractor ~ecomes involved in, or is threatened with, litigation
with a $ubcontractor 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.
STANDARD FEDERAL EQUAL EHPLOYMENT OPPORTUNITY CONSTRUCTION CONTRACT
SPECIFICATIONS (EXECUTIVE ORDER 11246)
1. As used in these specifications:
a. "Covered area" means the geographical area described in the solicita-
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
number used on the Employer's Quarterly Federal Tax Return, U. S.
Treasury Department Form 941.,
d. "Minority" includes:
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(1)
Black (all~ersons having origins in any oflthe
African racial groups not 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);
(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-
.s~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. If the Contractor is participating (pursuant to 41 CFR 60-4.5) in a
Hometown.Plan approved by ~~e u. 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 which have unions
participating in the Plan. Contractors must be able to demonstrate their
participation in and compliance wi~~ 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 OL~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 }a through p of these specifications. The goals
set forth in the solicitation from which this contract resulted are
expressed as perc~tages 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-~ich 'it 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.
5. 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.
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,6.
In order for the nonworking t.:::aining hours of appren t.lces dnd t.ra.llleeS
to be counted in meeting the goal~, such app~e~tices ~nd trainees must
be employed by the ctntractor dur~ng the tra1n.lng perlod~ and the
Contractor must have-made a commitment to employ the pprentices 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 the U. S. Department of Labor.
.' .
7. The Contractor shall take specific affirmative actions to ensure equal
employment opportuni ty. Th.e evaluation of the Contractor I s 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 more,'women to each
construction project. The Contractor shall specifically ensure that
all foremen, superintendents, and other on-site supervisory personnel
are awa=e 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.~eunion
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 ~eeting its EEO obligations; by
including it in any policy manual and collective bargaining agreement; by
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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 wid. 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 n~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 Contrac-
tqrs and Subcontractors with whom the Contractor does or antici-
pates doing business.
1. Direct its recruitment efforts, both oral and written, to minority,
female and community organizations, to schools with minority and
~ emale s tuden ts and to minori ty and f ema le recrui men t and training
organizations serving the Contractor's recruitment area and employ-
ment needs~ Not later than one month prior to the date 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 ~d 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, through
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
reI a ted activities to ensure that the EEO policy and the Contractor' s
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obliga tions unlr these specifications are beinA 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
associations.
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 which 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 }n the group, makes every effort to assure that the group has
a positive impact on the employment of minorities and wo~en in the
industry, ensures that the concrete benefits of the program are
reflected in the Contractor's minority and female workforce partic-
ipation, makes a good faith effort to meet its individual goals and
timetables, and can provide access to documentation which demonstrates
the effectiveness of actions taken on behalf of the Contractor. The
obligation to comply, however, i~ 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 women have
been established. The Contractor, however, is required to provide
equal emp~oyment opportunity and to take affirmative 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 mann~r (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 firm debarred from Government contracts pursuant to Executive
Ord~I;' 11246.
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12. The Contractor JLall carry out such sanctions anJ penalties for
violation of these specifications and of the Equa~ 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 who 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 its obligations under these specifications,
shall implement specific affirmative action steps, at least as exten-
sive as those standards prescribed in paragraph 7 of these specifica-
tions, so as to achieve maximum results from i,t9 efforts to ensure
equal employment opportuni ty. If the Contractor fails to comply with
the requiremen t9 of ilie Executive Order, the implementing regulations,
or these specifications, ilie Director shall proceed in accordance with
41 O'R 60-4.8.
14. The Contractor shall designate a responsible official to monitor 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 ilie 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 when assigned, social security number, race,
sex, status (e.g., mechanic, apprentice, trainee, helper, or laborer),
dates of changes in status, hours worked per week in the indicated
trade, rate of pay, and locations at which ilie work was performed.
Records shall be maintained in an easily understandable and retrievable
form; however, to ilie 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 oilier laws which establish di!ferent standards of
compliance or upon ilie application of requirements for the hiring of
local or other area residents (e.g., those under ~'e Public Works
Employment Act of 1977 and 'the Community Development Block Grant
program) .
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APPENDIX G
OMB
Circular A-llD
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Office of Management and Budget Circular A-110 (7/30/76)
A-110:1
OFnCE OF MANAGEMENT AND
BU DG ET
[Circular No, A-lID]
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 hizher edu-
cation, hospitals, and other nonprofit
organizations
1. Purpose.-This Circular' promul-
gates standards for obtaining consisten-
cy and uniformity among 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 nonprofit or-
ganizations. 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 wlll 'be
applied as soon as practicable but not
later than January 1, 1977.
3. Supersession.-This Circular res-
cinds and replaces parts III and IV of
the Appendix to Federal Management
Circular 73-7, 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 confiicting require-
ments that have been imposed by Fed-
eral agencies as conditions of grants and
other agreements with recipients,
5. Applicability and scope,-Except as
provided below, the stand.9.rds promul-
gated by this Circular are applicable to
all Federal agencies, If any statue ex-
pressly prescribes policies or speCific 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-
cipients performing substantive work
under. gTants that are passed through or
awarded by the primary recipient if such
subrecipients are organizations de-
scribed in paragraph 1.
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 financial assistance or that provide
support or stimulation to' accomplish 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 assistance
programs, which provide services instead
of money, (b) assistance in the form of
general revenue sharing, loans, 10ZJl
guarantees, or insurance" and (c) direct
payments of any kind to individuals,
b. The term "recipient" includes the
following types of nonprofit organiza-
tions that are receiving Federal funds
from a Federal agency 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 nonprofit organizations such as (but
not limited to) commtmity ll,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 Office
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 V!1ll be per-
mitted only in unusual cases. Agencies
may apply more restrictive requirements
to a class of recipients when approved by
the Office of Management and Budget,
8. Attcu:hments.-The standards pro-
mulgated by this Circular are set forth
in the Attachments, which are:
Attachment A Cash "depositories,
Attachment B Bonding and Insurance,
Attachment C Retention ...nd custodl...l re-
quirements tor records.
Att...chmen.t D Program Income,
Att...chment E Cost shn.rlng ...nd m...tchlng,
Attachment F St...ndards tor fin...nclal m...n-
agement systems.
Att...chment G Fln...nclal reporting require-
ments,
Att...chment H Monitoring and reporting
program pertormance,
Attachment I P...yment requirements,
Attachment J Revlslon ot financial plans,
Attachment K Closeout procedures,
Att...chment L S,uspenslon and termln...tlon
procedures,
Att...chment M St...ndard torm tor applying
tor tederal ILSslstance,
Attachment N Property management stand-
ards,
Att...chment 0 Procurement st...ndards,
9. Exceptions far certain recipien.ts,-
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 notified in writing as to:
a, Why the additional standards are
being imposed;
b, what corrective action is needed.
Copies of such notifications shall be
sent to the Office of Management and
Budget and other agencies funding that
recipient at the same time the recipient
is notified.
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 instructiom
implementing this Circular shall be
furnished to tile Office of Managemen t
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 fumished to the Office of Man-
:lgement and Budget not later than Au-
gust 30, 1976,
1 L 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,-CmcuLAR No, A-lID
CASH DEPOSITORIES
1. This att...chment sets fOF'th st...ndards
governing the use ot banks and other 10.-
stltutlons ILS depositories ot tunds advanced
under grants ...nd other ...greements,
2, Except tor situations described In para-
graphs 3, 4, ...nd 5, no Feder...1 sponsoring
...gency shall:
..., Require physical segregatlon ot cash de-
posl torles tor tunds which are provided to a
recipient,
b, Establish any ellglblllty requirements
tor cash depositorIes tor tunds which are pro-
vided to ... recipient,
3, A separate bank account shall be require
when ...ppllcable letter-ot-credlt agreements
provide that drawdowns will be mr.de when
the recipient's checks are presented to the
bank for payment,
4. Any moneys advanced to a recipient
which are subject to the contr~J.., or regula-
t.lon of the Untted States or any ot Its offlcers.
rgents or employees' (public moneys is de-
fined In Treasury CIrcular No. 1.76, as
amended) must be deposited In a ban'k with
Federal Deposl t Insurance Corpora tlon
(FDIC) Insurance coverage and the halance
exceeding the FDIC coverage must be col-
I...terally secured,
5. Consistent with the n...tlonal goal ot
expanding the opportunities tor mInority
business enterprises, recipients and sub-
recipients shall be encouraged ,to use minor-
Ity banks (... bank which Is owned ...t least 50
percent by minority group members),
ATTACHMENT B,-CmCULAR No. A-lID
BONDING AND INSURANCE
1. This attachment sets torth bonding and
Insurance requirements tor gr...nts and other
...greements with recipIents, No other bond-
Ing and Insur...nce requlremen<ts sh...ll be Im-
posed other th...n those norm...lly required by
the recipient,
2, Except as otherwise required by law. a
grant or other ...greement th...t requires the
contr...ctlng (or subcontr...ctlng) tor con-
struotlon or t...clllty Improvements shall pro-
vlr1p fnr t.'hP. T'prtntpnt. fro fnl1n'tL' H.C:: nw", rp_
"
J
Office of Management and Budget Circular A-110 (7/30/76)
qulrements relating to bid guarantees, per-
formance bonds, and payment bonds unless
the construction contract or subcontract ex-
ceeds UOO,OOO, ,For those coIlJtrActs or sub-
contracts exceeding tlOO,OOO, 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 lB adequately
protected, It such a determination has not
been made, the minimum requirements shall
be as follows:
a. A l1i4 guarantee Irom each bidder equiv-
alent to five percent 01 the bid price.-
The "bid guarantee" shall conslBt of a firm
commitment such as a bid bond, certltled
check, or other negotiable Instrument ac-
companying a bid as assurance that the bid-
der will, upon acceptance of hIB bId, execute
such contractual documents as may be re-
quired within the time specltled.
b. A perlormance bond on the part 01 the
contractor lor ~OO percent 01 the contract
prfce.-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 payment bond on the part 01 the con-
tractor lor 100 percent 01 the contract
price.-A "payment bond" Is one executed In
connection with a contract to assure pay-
ment 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 1"ederal
agency, at Its discretion, may require ade-
quate bonding and Insurance If the bonding
and Insurance requirements of the recipient
are not deemed adequate to protect the in-
terest of the 1"ederal Government.
4. The Fed,eral sponsoring agency may re-
quire adequate fidelity bond coverage where
the recipient has no coverage and the bond lB
needed Ita protect the Government's Interest.
6. Where bonds are required In the situa-
tions described above, the bonds shall be ob-
tained from companies holding certlficate6 of
authority as acceptable sureties (31 CPR
223).
A'lTACHJoO:NT C.-CncuLAB No. /1-110
aETZNTION AND ctlSTODIAL ILEQt1IJLJ:JoO:NTS roa
aECO&IlS
1. ThlB attachment sets forth record reten-
tion requirements for grants and other agree-
ments with recipients. Federal sponsoring
agencies shall not Impose any record reten-
tion requirements upon rectplents other thlLIl
those described below.
2, ExceJ)! for paragraph I, thlB attachment
also applies to subreclplents as referred to
In paragraph 6 of the basic circular.
3. FInancial records, supporting documents,
statlBtlcal records, and all other records perti-
nent to an agreement &hall be retained for a
period of three yeanl, with the folloWing
qu&!lficatlons :
a. It any litigation, claim or audit Is started
before the expiration of the 3-year period, the
records aball be retained untll all litigations
clalma, or audit findings involving the recor~
hAve been resolved,
b, Records for nonexpendable property ac-
quired wltoh 1"ederal funds &hall be retained
for 3 yea.ra after I ts finAl dlBpoeltlon
c. When records are transferred ~ or maln-
talned by the Federal SPODBOrlrig agency the
3-year retention requirement Is not appilca-
ble to the recipient.
4. The retention period starts from the
d.e.te of the subm.ls810n of the final expendi-
ture report or, for grants and other agree_
ments that are renewed annUally from the
date of the submission 'of the annual
ftnanclal status report.
5, Recipient organizations should be au-
thorized by the Federal sponsoring agency,
If they so desire, to 8ubstltute microfilm
copies In lieu of orlglnAl records.
6. The Fe<leral sponsoring agency shall re-
quest transfer, of certain records to Its cus-
tody from redplent orge..nlzatlons 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 duly authorized repre-
sentatives, shall have acCI!8S to any pertinent
books, documents, papers, and records of the
recipient organlzatlon and their subre-
clplents to make audits, examlnatloIl5, ex-
cerpts and transcripts.
8. Unless otherwise required by law, no
Federal sponsoring agency ahall place re-
strictions on recipient organizations that will
limit public access to the records of recipient
organizations that are pertinent to a grant
or agreement except when the agency can
demonstrate that such records must be kept
contldentlal and would have been excepted
from disclosure pursuant to the Freedom of
Information Act 16 U.8.C. 562) It the records
had belonged to the Federal sponsoring
agency.
ATrACHMENT D.-CmcuLAB No. A-110
PIlOGRAW INCOIoa
1. Federal sponsoring ~nc1es aball apply
the standards set forth In this attachment In
requiring recipient organizations to account
for progrs..m Income related to projects
financed In whole or In part with Federal
funds. Program Income represents gl'Ollll In-
come earned by the recipient from the fed-
erally supported activities, Such earnings ex-
clude Interest earned on advances ILIld may
Include, but wUl not be Ilm.lted to, Income
from service fees, sale of commodities, usage
or rental fees, and royalties on patents e.nd
coprlghts,
2. Interest earned on advances of Federal
funds &hall be remitted to the Federal agency
except lor Interest earned on advances to
States or Instrumentalities of .. State as pro-
vided by the Intergovernmental Cooperation
Ac~ of 1968 (Public Law 9G-liTI).
3. Proceeds from the sale of ree.l e.nd per-
son&! property either provided by the Fed-
eral Government or purchased In whole or In
part with Federal funds, shall be handled In
accordance with Attachment N to thlB cir-
cular pertaining to property management
4, Unless the agreement provides other-
wise, recipients shall have no obligation to
the Feder&! Government with respect to
royalties received as a result of COPYTlghts or
patents produced under the grant or other
agreement (&ee paragraph 8, Attachment N).
5, All other program Income earned during
the project period ahall be reta.lned by the
recipient and, In accordance with the grant
or other agreement, shall be:
a.' Added to funds commJtted to the proJ-
ect by the Federal sponsoring agency and
recipient organization and be used to further
eligible program obJectiVes;
b, Used to finance the non-Federal &hare
of the project when approved by the Federal
sponsoring agency; or
c. Deducted from the total project CORts
In determlnlng the ne~ 008ts on which the
Federal abare of CORts WUl be based,
A'lTACBWZNT E,-CmCt7LAJl No. A-ll0
COST SIlUDfC AND WATCHING
1. TblB attachment sets forth criteria and
procedurell for the allowabUlty of cash 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 cost sharing and matching require-
ments of Federal sponsoring agencies. This
attachment also establlahes criteria for the
evaluation of In-kind contributions made by
third parties, and supplements the guidance
set forth In Federal Management Circular
73-3 wlt1h respect to cost sharing on feder-
ally-sponsored research.
2, The following definitions apply for the
purpose of this attachment:
a. Project costa.-ProJect costs are all al-
lowable costs (as set forth In the applicable
Federal cost principles) Incurred by a recipi-
ent and the value of the In-ktnd contribu-
tions made by the reclplen t or third pe.rtles
In accomplishing the objectives of the grant
or other agreement during the project or pro-
gram period,
b. Cost 'haring and matching,-In general,
cost sharing and matching represent that
portion of project or program costs not borne
by the Federal Government.
c, ClJ.3h contributlO113.-Cash contributions
represent the recipient's cash outlay, includ-
Ing the outlay of money contributed to the
recipient by non-Federal third parties,
d, In-kind contrlbutUm.!.-In-klnd contri-
butions represent the value of noncash oon-
trlbutlons provided by the recipient and
non-Federal third parties. Only when au-
thorized by Federal legislation, may property
purchased with Federal funds be cons1c1ered
as the recipient's In-ktnd contrlbutlons. In-
kind contributions may be In the form of
charges for real property and non-expand-
able personal properly, and the value of
goods and services directly benetltlng and
specltlcally Identltlable to the project or
program.
3, General guidelines lor computing cost
sharing or matching are aa follows:
a. Cost &harlng or matching may consist
of:
(1) Charges Incurred by the recipient as
project costs. (Not all charges ~uIre cash
outlays by the recipient during t1he project
period; examples are depreCiation and use
charges for buUdlngB and equipment.)
(2) Project CORts financed 'WIth cash oon-
trlbuted or donated to the recipient by other
non-Federal public ~ncles and institutions,
and private organizations and individuals,
and
(3) Project costs represented by services
and real and personal property, or use there-
of, donated by other non-Federal public
agencies and Instltutlons, ILIld prllVate orga-
nizations and Individuals. '\
b. All contrtbutlona. both cash and 1n-
kind. shall be accepted as part of the reclpl-
ent.s CORt sharing and matching when such
contrIbutlons meet all of th'e followtng
crlterla :
(1) Me ver1.tl.able from the recipient's
records;
(2) Are not Included as contributions for
any other federally-assisted program;
(3) Are necessary and rea.eonable for prop-
er and elDclent acoomplJahment of project
obJectives;
(4) Me types of charges that would be al-
lowable under the appllcable OO8t prtnclples:
(6) Are not paid by the Federal Govern-
ment under another assistance agreement
(unless the agreement lB authorized by Fed-
erallaw to be UBed for cost sh&rlng or match-
Ing);
(6) Me provided for In the approved budg-
et when requlred by the Federal agency; and
(7) Conform to other provisions of this
attachment.
4. Values for recipient in-kind contribu-
tions wUl be establlshed In accordance with
the applicable cost principles.
6, Specltlc procedune for the recipients In
establlshlng the value of 1n-1I:lnd contrtbu-
<.
I
Office of Management and Budget Circular A-110 (7/30/76)
tlons from non-Federal third parties are set
forth be low:
a. Valuation ot voluntecr scrl'ices,-Volun-
teer services may be furnished by professional
and technical personnel, consultants, and
other skl\led and unskl\led labor, Volunteer
services may be counted as cost sharing or
matching If the service Is an' Integral and
necessary part of an approved program,
(l) Rates tor voluntccr scrvicc",,-Rates for
volunteers should bc conslstcnt with those
paid for similar work In the reclplent'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 similar work In the labor mar-
ket In which the recipient competes for the
kind of services Involved,
(2) Voluntcers IJmployed by othcr organi-
zation",,-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 skl1l for which
the employee Is normally paid,
b. Valuation at 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-
so~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 donation.
c, Valuation at donated, nonexpendable
personal property, buildings, and land. or
Wle thereat,
(I) 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 matching,
(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 value of equloment or
other capital assets and fair rent3.1 charges
for land may be allowed provided that the
Federal agency has approved the charges.
(2) The value of donated 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 buildings may not,exceed
Its fair 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) Nonexpend.able pet'sonal pTo'perty,-
The Value of donated nonexpendable personal
property shall not exceed the fair market
value of equipment and property of the same
age and condition at the time of donation,
(c) Use at space.-The value of donated
space shall not exceed the fair rental val uc
of comparable space as established by an
Independent appraisal of companble space
and facilities In a privately-owned building
In the same locality:'
(d) Loaned equipment,-The value of
loaned equipment sha\1 not exceed Its fair
rental value,
6. The following requirements pertain to
the recipient's supporting records for In-
kind contributions from non-Federal third
parties,
a, Volunteer services must be document.cd
and. to the extent feasible, supported by the
same methods used by the recipient for Its
employees,
b, The basis for determining the valuation
for personal services, material, equipment,
buildings and land must be documented,
ATTACHMENT F,--cIRCULAR No, A-1I0
STANDARDS FOR FINANCIAL MANAGEMENT
SYSTEMS
L This attachment prescribes standards for
financial management systems of recipients.
Federal sponsoring agencies shall not Impose
addltto'nal standards on recipients unless spe-
cifically provided for In the appllcable. 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 estballshlng or Improving
financial management systems when such as-
sistance Is needed or requested,
2. Recipients' financial management sys-
tems shall provide for:
a, Accurate, current and complete disClo-
sure of the financial results of each federally
sponsored project or program In accorc\anee
with the reporting requirements set forth In
Attachment G to this circular, When a Fed-
eral sponsoring agency requires reporting on
an accrual basis, the recipient shall not be
required to establish 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, authorizations, obligations, unobli-
gated balances, assets, outlays, and Income,
c. Effective control over and accountability
for 0.1\ funds, property and other assets, Re-
cipients shall adequately safeguard a1\ such'
assets and sha\1 assure that they are used
solely for authorized purposes,
d, Comparison 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 bl! related to performance
and unit cost data,
e, Procedures to minimize the time elapsing
between the transfer of funds from the U,S,
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 drawdowns as close as pos-
sible to the time of making disbursements,
f. Procedures for determJnlng the reason-
ableness, allowablllty and a1\ocablllty of costs
In accordance with the provisions of the ap-
plicable Federal cost principles and the terms
of the grant or other agreement,
g, ACeountlng 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 Fedel'al funds, to produce un-
biased opinions, conclusions or judgments,
They shall meet the Independence criteria
along the lines of Chapter 3, Part 3 of the
U,S, General Accounting ornce publication,
Standards for Audit of Governmental Organ-
Izations, Programs, Activities and Functions,
These examinations are Intended to ascer-
tain the effectiveness of the financIal man-
agement systems and Internal procedures'
that have been established to meet the terms
and conditions of the agreement.~, It Is not
Int.ended t.hat 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 we1\ as compliance
wi th the terms and condl tlons of the Federal
grants and other agreements, Such tests
would Include an appropriate sampling of
Federal agreements. ExaminatIons will be
conducted with reasonable frequency. on a
continuing bllSls or at scheduled Intervals,
usually annually, but not less frequently than
every two years, The frequency of these ex-
aminations sha1\ depend upon the nature,
S17.c and the complexity of the actvllty, These
examinations do not relieve Federal agencies
of t.heIr audit responsibilities, but may affect
the frequency and scope of such audIts,
I. A systematic method to assure timely and
appropriate resolution of audit findings and
recommendations,
3, Primary recipients shall requIre subre-
clplents (llS 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 ,subparagraph 2a, regarding reporting
fonns and frequencies prescribed In Attach-
ment. G to this circular,
ATTACHMENT G,-ClaCULAa No, A-1I0
FINANCIAL REPORTIN'G REQUIREMENTS
L This attachment prescribes uniform re-
porting procedures for recipients to: sum-
marize expenditures made and Federal funds
unexpended for each award, report the status
of Federal cash advanced, request advances
and reimbursement when the letter-of-credlt
method Is not used; and promulgates stand-
arel, forms Incident thereto,
2, The following definitions apply for pur-
poses of this attachment:
a, Accrued expenditure3,-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 Is
required.
b, Accrued inco'l'e,-ACcrued Income Is the
sum of (I) earnlhgs during a given period
from (I) serYlces,performed by the recipi-
ent; and (II) goods and other tangible
property delivered to purchasers; and (2)
amounts becoming owed to the recipient for
whil(h no current services or performance Is
required by the recipient,
c, Federal tunds authorized.-Federal
funds authorized are the kltal amount of
Federal funds obligated by th~ Federal Gov-
ernment for use by the recipient. This
amount may Include any authorized carry-
over of unobllgated funds from prior fiscal
years when permitted by law or agency
regulation,
d. In-kind contributions,-ln-klnd con-
tributions are defined In Attachment E to
this circular,
e. Obligations,-Obllgatlons are the
amounts of orders placed. contracts and
grant.s awarded, services received. and sImi-
lar transactions during a given period that
will require payment by the recipient during
the same or a 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 basis.
outlays are the sum of actual cash dlsburse-
ment,~ for direct charges for goods and serv-
Ices. the amount of Indirect expense charged,
the value of In-kind contributions applied.
and the amount of cash advances and pay-
ments made to subreclpients, For reports pre-
pared on an accrual basis, au tlays are the
sum of actual cash disbursements ,for direct
charges for goods and services, the amount
of Indirect expense Incurred, the value of In-
I
Office of Management and Budget Circular A-110 (7130/76)
kind contributions applled, and the net In-
crease Jor decrease) In the amounts owed by
the recipient for goods and other property
received, for services performed by employ-
ees, contractors, subreclplents 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
defined In Attachment D of this circular. It
may be reported. on a co.sh or accrual basis,
whichever Is used for reporting outlays.
h, UnobHgated balance.-The unobllgated
balance Is the portion of the funds author-
Ized by the Federal sponsoring agency that
has not been obllgated by the recipient and Is
determined by deducting the cumulative
obligations from the cumulative funds au-
thorized,
L UnHqu/dated obUgaHon.!,-For reports
prepared on a cash' bo.sls, unllquldated obll-
gatlons represent the'amount of obllgatlons
Incurred by the recipient that has not been
paid, For reports prepared on an accrued ex-
penditure basis, they represent the amount
of obllgatlons Incurred by the recipient for
which an outlay he.s not been recorded.
3, Only the following forms wlll be au-
thorized for obtaining financial Information
from recipients.
a, Fhumcial Status Report (ExhIbit 1).
(I) Each Federal sponsoring e.gency shall
require recipients to use the standardized
Financial StatuS Report to report the status
of funds for all nonconstructlon projects or
programs. The Federal sponsoring agencies.
may, 1!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 (paragraph 3b) Is determined
to provide adequate Information to meet
their needs, except that a final Financial
Status Report shall be required at the com-
pletion. of the project when the Request for
Advance or Reimbursement form Is used only
for advances,
(2) The Federal sponsoring agency shall
prescribe whether the report shall be on a
cash or accrual basis, It the Federal sponsor-
Ing agency requires accrual Information and
the recipient's accounting records Me not
normally kept on the accrual basis, the re-
cipient shall not be required to convert Its
accounting system, but shall develop such
accrual Information through best estimates
based on an analysis of the documentation
on hand,
(3) The Federal sponsoring agency shall
determine the frequency. of the Financial
Status Report for each project or program
considering the size and complexity of the
particular project or program, However, the
report shall not be required more frequently
than quarterly or less frequently than an-
nually except as provided In subparagraph
3a (I) above, A final report shall be required
at the completion of the agreement.
(4) Federal sponsoring ..gencles shall re-
quire recipients to submit the Financial
Status Report (original and no more than
two copies) no Ia.ter than 30 days aCter the
end of each specified reporting period Cor
quarterly and seml-..nnual reports, and 90
days Cor annual and final reports, Extensions
to reporting due dates may be granted upon
request oC the recipient,
b, Report 01 Federal Ca..h Transactions
(EXhibit 2),
(I) When funds a.re a.dvanced to
recipients through letters of credit or with
Treasury checks, the Federal sponsoring
..gencles shall require each recipient to sub-
mit a Report of Federal Ca.sh Transactions.
The Federal sponsoring agency shall use this
report to monitor cash adva.nced to recipients
I\nd to obtain disbursement .Informatlon for
each agreement from the recipients.
(2) Federal sponsoring a.gencles may re-
quire forecasts oC Federal cash requirements
In the "Remarks" section ot the report,
(3) When practical and deemed necessary,
the Federal sponsoring agencies may require
receipts to report In the "Rema.rks" section
the amount of ca.sh advances In excess ot
three days' requirements In the hands of sub-
recipients and to provide short na.rratlve ex-
planatIons ot actions taken by the recipients
to reduce the exceS3 balances,
(4) Recipients shall be required to submIt
not m:lre than the original and two copies ot
the Report of Federa.l Cash Transactions 15
working days following the end of each
qua.rter. The Federa.l sponsoring a.gencles
may require a monthly report trom those
recipients receiving advances totaling $I
million or more per year,
(5) Federal sponsoring agencies mal' waive
the requirement for submission ot the Report
or Federa.l Cash Tra.nsactlons when monthly
a.dvances do not exceed $10,000 per recipient,
provided tha.t such a.dvance3 are monitored
through other rorms contained In_J;hls a.t-
t3.chment, or If, In the Federal sponsoring
c.gency's opinion, the recipient's accounting
controls I\re adequate to minimize excessive
Federal advances, .
4, Except a.s noted below, only the rollow-
Ing rorms wlll be authorized ror the reclpl-
ent3 In requesting a.dva.nces a.nd relInburse-
ments,
a, Request lor Advance or Reimbursement
(Exhibit 3).
(I) Each Federal sponsoring a.gency sha.1I
a.dopt the Request ror Advance or Reimburse-
ment a.s a standardized rorm tor all noncon-
structlon programs when letters-or-credlt or
predetermined advance methods a.re not used,
Federa.l sponsoring agencies, however, ha.ve
the option oC using th13 rorm tor construc-
tlon programs In lleu of the Outlay Report
and Request for Reimbursement ror Con-
struction Programs (subpara.graph 4b).
(2) RecipIents shall be authorized to sub-
mit requests tor advances ..nd reimburse-
ments at least monthly when letters-or-
credit a.re not used, Federal sponsoring
agencies shall not require the submission ot
more than the original and two copies ot the
Request for Advance or ReImbursement,
I
A-110:4
b, Outlay report and request lor reim-
bursement lor construction programs (Ex-
hibit 4),
(I) Each Federal sponsoring agency shall
adopt the Outlay Report and Request tor Re-
Imbursement ror Construction Programs as
the standardized tormat to be used for re-
questing reimbursement tor construction
programs, The Federa.l sponsorlr.g agencies
ml\Y, however. have the option oC substitut-
Ing the Request ror Advance or Reimburse-
ment Form (subparagraph 4a) when the
Federal agencies determIne that It provides
adequate In!orlTU\tlon to meet their needs.
(2) Recipients shall be authorized to sub-
mit requests ror reimbursement at least
.monthly when letters-of-credlt are not used.
Federal sponsoring agencies shall not require
more than the original and two copies ot the
Outlay Report and Request tor ReImburse-
ment for Construction Programs,
5, When the Federal sponsorIng agencies
need addltlonal Intormatlon In using these
rorms or more trequent reports, the rollowlng
shall be observed:
.a. When addltlonal Information I.s needed
to comply with legislative requirements,
Federal sponsorIng agencies shall Issue In-
5tructlons to require recipients to submIt
such Inrormatlon under the "Remarks" sec-
tion of the report.s,
b. When necessary to meet specific pro-
gr3.m needs Federal sponsoring agencies shall
submit the proposed reporting requirements
to the Financial Management Branch, Budget
Review Division, Omce or Management and
Budget ror approval prior to submission or
the reports for cleara.nce under the pro-
visions or OMB Circular No. A-40,
c, When a Federal sponsoring e.gency has
determined that a reclplent.s accounting sys-
tem does not meet the StlUldards tor FI-
nancl"l Management contained In Attach-
ment F to this circular, additIonal pertinent
InformatIon to rurther monitor grants and
other agreements may be obtained upon
written notice to the recipient until such
time as the system Is brought up to standard,
d, The Feder..1 sponsorIng agency. In ob-
taIning Inrormatlon e.s In paragraphs a, b
and c above, must comply with report clear-
ance requirements ot the Omce of M..nage-
ment a.nd Budget Circular No, A-40, as re-
vised,
6, Federal sponsorIng agencIes have the
optlon or shading out any llne Item on any
report that Is unnecessary for decision-mak-
Ing purposes,
7: Federal sponsoring agencleG should ac-
cept the Identical Information from the re-
cipients In machine usable tormat dr com-
puter printouts In lieu ot prescrIbed rormats,
8, Federal sponsoring agenclcs may pro-
vide computer outputs to recIpients when It
wlll expedite or contribute to the accuracy
oC reporting,
9, Federal sponsoring agencIes are author-
Ized to reproduce these rorms, The forms tor
reproduction purposes can be obtained rrom
the Omce or Man3.gcment and Budget,
FINANCIAL STATUS REPORT 1. nDDtAL AGIHCT AHD OftQAHlIAnOHAL ILlMIHT TO WHICH Jtl:P'OIIIT 'I IUI"rrT!O 2. '(O.IIAL GRANT 011 0Tl4(~ IMHTlfYlHG I OMS Approved I PAGE OF
HUM..~ No, no-ROISO I
(Follow i1UJtructilnU on tho back) "'AGES
l. AEC''''[NT ORGANllATlON -CNdfff.. and e"""pl.t. Gddl'.... i,,,:lvdi,,,, ZIP l:od..l 4. [...!t1.0YI~ IMNTtFlCATION NU".IR So MCI"I:HT' ACCOUNT NU...r:R 0" IDIHTlnlHG NU...fllll L nNAL ,,[.-oRT 7. BASIS
DYES o NO o CASH O. ACCRUAL
L P'ftOJ[CT/QItAHT n",oo IS.. i_tn&e~) .. "RIOD COVERED ..., THIS REPORT
f'ROM (MOflfh, d.a.1t. ,.sr) --r TO (,vOft&-'. dos,. ,.of'1 FROM ("'o"t~. .... "_1'1 TO IM_t"', dov. ....,,)
lO, STATUS OF FUNDS
(a) (b) (c) (d) (.) (f) TOTAL
PROGRAMS/FUNCTIONS/ ACTIVITIES ~ (g)
I. Net outlays previously reported $ $ $ $ $ $ $
), Total outloys this roport period
.. Leu: Program Income credits
L N~t outlays this report period
(Lin, h minn, lint c) !
), Not oullays to dato I
(Lin. a plu. lint d) " .
L~u: Non'Fede~al Sha~e of outlays
I, Total Fedel'lll share of outlays
(Lin. , minus Cine f) !
1., Total UnllqUldat~d obli~ations
L.II: Non,Fodoral sharo of unllquldatad
obligations thown on line h
Fodaral sharo of unllquldatod obligation. .'
.. Total Federer shere of outley. and
unllquidatod obligations
Total cumulative amount of Federal fundt
authorizod
,
" Unobllgatod balanco of Fodoral fundi
.. TYPE OF RATE PROVISIONAL I 0 PRmETlRNINED U. CERT1"CAnON SIGNATURE OF AUTHORIZEO CERTIFYING DATE REPORT
1. (Pl<u:. "X" in Gpp"op1'i4!o bon) 0 o "NAL o "X[O I cortlfy to tho beat of my knowlodgo and be- OFFICIAL SUBMITTED
iDIRreT I c. BASE I d. TOTAL AMOUNT 1_' 'EDEAAl SHARI 1I0f thatthl. roport Is corroct and completa and
XP-ENI! b. RATE
that all outlayo and unllquldatod obllrotlonl TYPED OR PRINTED NAME AND TITLE TELEPHONE (Ar.a caU,
'ara for tho PUrpolO1 lot forth In tho .word ,,,(,,,be.,. a.nd ntennOft)
z. Rt"A~I: Atr.-.... 4"" _~tw- d.......,J. '/YO'''-' ar '''fO'MN4t--. r.q.:nd b, TId#Nl ~"" IIQ~ "' COWiIpUcs"OI wUA documents.
110"'''''''''11 1.aU1Ar--..
....'0' EXHIBIT 1
j
STANDARD ro".. 2154 (7-76)
Pr_s.ertbed by Orne_ or M_n_l_m_nt lI,nd Bud._t
CIRCUL"'R NO. ....110
0
-
-
0
(1)
0
-
s:
ll)
;:,
ll)
(Q
(1)
3
(1)
;:,
....
ll)
;:,
a. ~
OJ
c::
a.
(Q
(1)
....
Q
..,
0
c::
ll)
..,
>
I
.....
....
0
-
~
........
W
0
........
~
0)
-
-
l>
I
....
.....
~
CJ1
I
,
Office of Management and Budget Circular A-110 (7/30/76)
INSTRUCTIONS
Please type or print legibly, Items 1,2,3.6.7.9. lCd, 1De, 109, 101, 101, lb. and 12 are self,explanatory.
specific instructions f:Jr other items are as follows:
114M Enl."
4 Enl.r Ih. employ.r Id.nI11l""llon number assigned by
Ih. U,S, Int.mal Rev.nue S.rvlc. or FICE (Instilutlon)
cod.. II required by tho Fed.ral .ponsorlng ag.ncy.
5 This spece II reserved for en aecount number or other
identltylng numbers that r:nay be assigned by the
recipient.
8 Enter the month, deV, end yeer of the beginning end
ending of this project period. For formula Irants that
are not awarded on a project baSil, show the grent
period,
10 Th. purpose 01 vertical column. (a) throullh ('> Is to
provide financlel data for elch progrem, function, end
actlYity In tho budget as approved by tho F.d.rel spon.
sorlng .gency. If additional columns are neede<f, use as
many addltlon.1 'orms as needed and Indlcat. page
number In splice provided In upper right: however, the
totels of all programs, functions or activities should be
shown In column (g) of tho first pag., For agr..ment.
pertaining to sey.,al Catalog 0' Fed.ral Domestic
Assistance programs that do nol requlra a 'urth.r
lunctlonal or activity cla..11I""tlon br.akdown. .nter
und.r columns (a) through (I) the title 0' the program,
For grants or other auistllnce agreements contalnlna
muttlple progrems where one or more programs require
a lurther breakdown by function or actlYlty. us. .
..perate 'orm for .och program showing the applicable
functions or activities In the separate columns. For
8mnts or other assistanee agreements cont81nlng HV'
eral functions or activities which are funded from
seY81'81 programs, prepare a 'Separate form for each
octlYity or function when requo.ted by the Fed.ral
oponsorlng og.ney,
lOa Enl1lr tho not outlay, this omount should be t~a sam.
a. tho amount reported In line 10. of Ihe last report,
If there has been an adjustment to the amount shown
p"",lousty, pl.... attach explanation. Show z.ro If this
Is th. Inltl.1 r.port, '
lOb Ent.r t~. total gros. program ouIloys (I... rebat..,
refunds, and oth.r discount.) lor thl. report period,
Including disbursements of cash realized as program
Income. For reports that are prepared on a ash
balis, outlays are the sum of actual cash disburse.
ments for goods and services, the amount of Indirect
.xpen.a cha'lled. tho yolue 0' In, kind contribution.
applied, and the amount of cash advances end
payments made to contractors and subgrantees. For
reports prepared on an accrued expenditure basis. out.
lays Ire the sum ot actual cash disbursements. the
amount 0' Indirect expense incurred. the value .0' In-
kind contributions applied. and the net Increase (or
decreaH) In the amounts owed by the recipient lor
goods and other property received and for servtces
perlormed by .mployee., contractors, .ubtlrant.... and
oth.r payees.
114M Enl."
JOe Enter the amount 01 all program Incoma realized In
this period that is requirf'd by the terms and con.
ditions of the FederalaW8rd to be deducted from total
protect costs. For reports prepared on a cash basis,
enter the amount of eash Income received during the
reporting period. for raports prepared on an accrual
basis. anter the amount, of Income earned since the
beginning of the reporting period. When the terms or
conditions allow program Income to be added to tha
tot81 ftward, explain In remarks. the source. amount
and disposition ot tha Incoma.
101 Enter amount pertaining to the non.Federal share 0'
program outlays Ineluded In the amount .~n line e.
10h Enter to!al amount of unllq"ldated obligation. for thl.
project or program, including unliquidated obligations
to subgl'8ntees" and contractors. Unliquidated obliga-
tions are:
Ca.h baslo-obllg.tlon. Incurred but not paid;
Accrued expenditure ba.l~bllgations Incurred but
for which.. an outlay has not been recorded.
Do not includa any amounts that have ~n Included
on lines a through I. On the flnal report. line h should
hava I zero balance.
101 Ent.r tho Fed.ral s~ara 0' unliquidated obligations
shown on line h. The amount shown on this line should
be the dlnerenee between the amounts on lines h and I.
10k Enter the sum 0' the 8mounts shown on lines '8 and J.
" tho report's final tho r.port .hould not conte in any
unliquidated obligations.
10m Enter tho unobllgeted balance of Federal fund.. Thi.
amount should be the dlnerence between line. k end 1.
11 b Ent.r rat. In enect during tho reporting period.
llc Entar amount of the base to which tha rate was applied.
11d Enter total amount of Indirect coot c~erged during tho
report period,
lIe Enter amount of tha federal share cherged during the
report period,
If mo... than ona rate was applied during the project
per~. include I separate schedule showing bases
Igainst which the Indirect cost rates were applied. the
respective Indirect rates the month, day, and year the
indirect rates were In effect, amounts of Indirect ex.
pense charged to the project. and the Federal share of
Indirect .xpen.. cha'lled 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
Approved by Office 01 Monollemenl and BudllOI. No, 80-'10182
FEDERAL CASH TRANSACTIONS REPORT 1. federal sponsoring IIeM")' and orr.nilllion.l .le",,"1 to which this report
is submitted
(See instructions on the back. If report is for more than one grant or
assistance agreement, attach completed Standard Form .t7f-A ,)
2. RECIPIENT ORGANIZATION 4. Fed....1 lnonl or olhor idonlihea, 5. RecipiOftI'. accouPlI ""mbtr or
lion number 1,*,lil)'iol oumbor
Name : I.. leller 01 credil oumber 7. lilt pey...ent YOlICher ",,,"bet'
N..",btn' Give total number for this period
aM Stred :
8. Plyment Vouchers credited 10 9. TrNsury chech received (wMther
)'OUr account ur not depo.ited)
Citll, Slat. 10. PERIOD COVEREO BY THIS REPORT
and ZIP Cod.,
3. FEDERAL EMPLOYER ~ FROM ("'0"'''. cia". 1I....r) TO ("'0,,1", cia" "ear)
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
instructions
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 AVlOUNT SHOWN 13. OTHER INFORMATION
ON LINE llJ, ABOVE,
REPRESENTS CASH RE- a. Interest income $
QUIREMENTS FOR THE
ENSUING
Davs b. Advances to subgrantees or subcontractors $
.
14. REMARKS (A ttach addit40nal sheets of plain paper, if more space is required)
15.
CERTIFICATION
SIGNATURE
DATE REPORT SUBMITTED
I certify to the best of my
knowledge and belief that
this report is true in all re-
spects and that all disburse-
ments have been made for
the purpose and conditions
of the grant or agreement
AUTHORIZED
CERTIFYING
OFFICIAL
TYPED OR. PRINTED NAME AND TITLE
(Ar... C0d4)
(N..",!>.,.)
(E""....;"" )
TELEPHONE
THIS SPACE FOR AGENCY USE
272-101
EXHIBIT 2
STANDARD !'ORM 272 (7-76)
Prescribed by Office 01 Manoli:em.nl and Budcet
.......,.,,..,,, ,,.. ....... . ".--
. ,
I
I
Office of Management and Budget Circular A-110 (7/30/76)
A-110:8
INSTRUCTIONS
PteftH type or print legibly. Items I, 2, 8, 9, 10, lId, lIe, llh, and 15 are self explanatory, specific
instructions for other Items are as follows:
Ie-
E7It",
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 grent or other
agreement, leave Items 4 and 5 blank and provide the
information on Standard Form 272-A, Report of Fed.
erel Cash Trensactio"~ontirnled; otherwise;
4 Enter Federel grent number, egreement number, or
other Identifying numbers if requested by sponsoring
agency.
5 This space reserved for an account number or other
Identifying number that may be aui,ned by the re-
cipient.
6 Enter the letter of credit number that applies to this
report. H all advances were mede by Treesury check,
enter "NA" for not applicable and leave items 7 and 8
blank.
7 Enter the voucher number of the lut letter-of-credit
payment vou<:her (Form TUS 5401) that was credited
to your account.
lla Enter the total emount of Federel cesh on hand at the
beginning of the reporting period Including all of the
Federal funds on deposit, Impntst funds, and und..
poSited Treesury cllecks.
llb Enter total amount of Federal funds received through
payment vouchers (Form TUS 5401) that were credo
Ited to your account during the reportJng period.
llc E,,", the total amount of all Fedentl funds received
during the reportinc period through Treasury checks,
whether or not depo5ited.
llf EMer the total F~I cash ctt.bursements, mette
during tM ~ period, mcludlng cash received
H program Income. Disbursements 81 used here also
in<;tooe the arnowftt of advances and payments less
refunds to subgNntees or contractors, the ,ross
amount of direct Mlari_ and wecec., Includina the
En t",
It""
emplepee'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.
l1g 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 agree":,,~nt.
lli
Enter the amount Df all adjustments pertaining to prior
periods affecting the ending balance that have not
belln included in any lines above. Identify each grant or
allreernent for which adjustment was made, and enter
an explanation for each adjustment under "Remarks."
Use plain sheets of paper It additional space is required.
11]
Enter the total amount of Federal cash on hand at the
end of the reporting period. This amount should Include
all funds 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 Ilj, will be expended. If more than
three days cash reqirements are on hand, provide an
explanation under "Remarks" as to why the drawdown
was made prematurely. or other reasons for the excess
cash. The requirement for the explanation does not
apply to presc;heduled or automatic advances.
13a
Enter the amount of Interest earned on advances of
Federal ~nds 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-
cluded in item 11h.
"I
14
In addition to providing explanations as required above,
live additional explanation deemed necessary by the
rec:tplent and for il1'forTMtion required by the Federal
sponsoring agency in compliance with governing legis-
lation. Use plain sheets of paper If additional space i.
required.
'"
I
I
Office of Management and Budget Circular A-110 (7/30/76)
A-110:9
FEDERAL CASH TRANSACTIONS REPORT
CONTINUATION
(Thill frYrm ill complet.ed and att<u:hed to Standard Form f7t onlV when
repMting mM'6 than (n't.f! grant or assista.nce agr~eP7U!nt.)
'2. RECIPIENT ORGANiZATION (Give na.... onlV eu .ho"", in item t, SF
t7f)
'Approved by Office of Management ane 8udg.t, No,
BO_ROI B2
L fEDERAL SPONSORING AGENCY lo.ND ORGANIZA,
TlONAL ELEMENT TO WHICH TH~ REPORT is SUB,
MITTED
3. PERIOD COVERED BY THIS REf>oRT (A. .hown on SF
t7t)
FROM (~ortlh. ck... If.r)
TO (M_,,,. I!ttar. ..eo,.)
4. List information below tor each grant or other agreement covered by this report. Use additional forms if more space is required.
FEDERAL GRANT DR OTHER IOENTlF I RECIPIENT ACCOUNT NUMBER fEDERAL SHARE OF NET DISBURSEMENTS
CATION OR lYTHER
IDENTIFYING NUMBER NET OISBURSEMENTS (Ct-ou CUMULATIVE
fShow .. ...bdiviJion bv other identi- di..bv:r.ll'"",,''' I".. provro," '"'" NET DISBURSEMENTS
~ing n"mber.if ~equiTOd bv the eo",,, run.."') FOR REPORTING
edOTal SpOTUJOT1ng ,AgenClf) PERIOD
(a) (b) (e) (d)
$ $
, ,
I
.
-
I .
..
,
5. TOTALS (Sh.culd cor-re.pontl with .."..,unta .hown on SF f7t eu
followa: column (cl the ....... eu line Ilk; colwmn (d) the It"n of li"e,'1
Ilk a"d Iii, of t~i,.sF ~7~ and cumul..tive disburBementa .h""", on $
leu! reprYrt. A Hach ~"'pl4natio" of anv differeM"'.) $
272-201
STANDARD FORM 272-A (7-76)
~~.!!.~r~~~ bt Off I c.e. ~r ManOQem...t end Budo~t
Offlc'e of Management and BUd,et Circular A-110 (7/30/76)
I
REQUEST FOR ADVANCE
OR REIMBURSEMENT
Approved by Ollieo of Monagomont ond
Budgot. No, llO-R01B3
PAGE
Of
1,
rvPE Of'
PAYMENT
REQUESTED
.0 .. r' D'M, ~ ..tA h....
o ADVANCE 0 ~i:'~,!'URSE'
b. ".1''' 1M .r~" bo.
PAGES
2, BASIS Of REQUEST
o CASH
(See iutrvctiou Oft. back)
~AL SPONSORING AGENCY AHD ORGANIZATIONAL ELEMENT TO
WHICH THIS REPORT IS SUBMITTED
o fINAL 0 PARTIAL 0 ACCRUAL
.t. fEDERAL GRANT OR OTHER s..--..ARTIAL PAYMENT A[QU~
IDENTIfYING HUM8t:R ASSIGNED NUMBER FOR THIS REQUEST
BV nOERAl AGENCY
L EMPLOYER IOOlTIFICATlON
NUMB["
7. RECIPIENTS ACCOUNT NUMBER 8. PERIOD COVERED BY THIS RE UEST
OR IDENTIFYING HUMBER rROM C_.... tie" ....d TO (_IA....... ~)
go RECIPIENT ORGANIZATION
10. PAYEE (W.lwn...... if 10"'_'" .6..._. u..- i'-')
N._
H_..
N_'"
_Rei .b..
N-'-
-'" 3'~Mt
c.... _
... ZIP Ceoit :
C'h. seel,.
-... Zlrcod..:
11. COMPUTATION OF AMOUPfT OF REIMBURSEMENTS/ADVANCES REQU ESTl:D
(8) (h) (e)
, ,
PROGRAMS/FUNCTIONS/ACTIVITIES ~ TOTAl
a. Total PrDII",m (A, ./ dol.)
outley. to date $ $ $ $
b. lAN: CumwleUve prosram Income
e, ~ L')8"'m outleys (Li1w a ..._
d, [Almeted not euh outlays lor odvonc.
period
0, Toul (S..... .f ,,,..,..t d)
f. Hon.Federel....,.. of amount on Hne.
.. Fede,..f .he,. of amount on line I
h. ~odo",1 pBymonto proviouoty requested ..
I. ~ed....1 "'0.. now requooied (LiN V
.........,iowll)
J, /\<Non... required by lit month
month, when requested
"" Fodo",1 ,",ntor ogooey
for UN I.. moking pre' 2nd month
Khedwled advancea
Jrd month
12.
AlTl:RltAn: COMPVTATlON FOR ADVANCES ONLY
0, EWmoted Fed..., cash outloys thot will bo mad. during period covered "" the advance
$
k1. Lu.: Estimated bale nee of Fed.ral calh on hand al of beginning of edvence period
e, Amount roquBBted (LiN" trIi..... 1m. h)
13,
$
CUlTIFlCA'fION
SICNATURE Of AlITHORIZ[D COfTlNINO o,nCIAl
OA,TE REQUf:ST
SUBMITTED
, corttf'y tho! '" tho boot 01 my ""_ell..
and belief the data aboYe are corrK't' and
tMt all outlaya were made in accordance TYPED OR. "'INTED NAME AND TITLE
with the are"t conditions or other a,,",
me'" and that peyment ls due and ha. not
-., prwlouoty roquootod,
A_ c.4o
H_6_
81ta..-w..
TnL.....ONE
No opaca lor apncy _
,71>-,., EXHIBIT J
ITAHbAJID P'OMI J7'D (7-76)
,,"scr1to.d bf Offtce 04 .hn...ment .nd a~
ClRCuLAR NO. A-ll0
Federal Grants Management Handbook September 1978
A-110:10
,
Appendix I
I
I
Office of Management and Budget Circular A-110 (7/30/76)
INSTRUCTIONS
Please type or print legibly, Items 1,3, 5, 9, 10, lIe, lIe, Ill, IIg, IIi, 12 and 13 are self,explanatory;
specific instructions for other items are as follows:
Item E"trJI
2 Indicate whether request is prepared on cash or ac.
crued expenditure basis., All requests for advances
shall be prepared on a cash basis.
Enter the Federal grent number, or other identifying
number assigned by the 'Federal sponsoring agency. If
the advance or reimbursement is for more than one
gr'Zlnt or other egreement. 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 against the grant or agreement.
6 Enter the employer Identification number assigned by
the U.S. Internal Revenue Service. or the FICE (institu.
tion) code II requested by tha Federal agency,
This space is reserved for an account number or other
Idantilyine number that may be assigned by tha
recipient.
8 Entar tha month, day, and year lor the beginning and
ending of the ~riod covered In this request. II the rw.
quest is for an advance or for both an advance and re.
Imbursement. ShOW the period that the advance will
cover. 11 the request Is for reimbursement. show the
period for which the reimbursement Is requested.
Note: The Fedefllll sponsoring agencies have the option of
requiring recipients to complete Item~ 11 or 12. but not
both. Item 12 should be used when only a minimum
amount of informetion is needed to make an advence
end outlay Infonflation contained In Item 11 can be
obtained In e timely manner from other reports.
11 Tha purpose olth. vHtlcal columns (a), (b), and (e), is
to provide spece for seperate cost breakdowns when a
project has been planned and budgeted ~ program,
function. or ectivity. If additional columns are needed,
Item E7llrJI
use as many additional forms 8S ne-eded and indicate
page number in space provided in upper right; how-
ever. the summary totals of all programs. functions.
or activities should be shown in the ..total" column on
the first page.
Ita Enter in "as .of date". the month. dey. and yeer of the
ending of the accounting period to which this amount
applies. Enter progrem outlays to date (net of refunds.,
rabetes, and discounts). in the lJppropriate columns.
For requests prepared on a cash basis. outlays are the
sum of actual cash disbursements 'or goods and $erv-
Ices, the amount of indirect expenses charged. the
value of in-kind contributiOfJ.$ epplied. and the amount
of cash advances and payments made to subcontrac.
tors and subr~iplents. For requests prepared on an
accrued expenditure basis. outlays are the sum of the
actual cash disbursements. the amount of Indirect ex-
penses Incurred. end the net Increase (or decre.ase) In
the amounts owed by the recipient for goods and other
property received and for services performed by em.
ployees, contnlcts, subgrantees and other payees.
lib Enter the cumulative c8sh Income received to date. tf
requests are prepared on a cash basis. For requests
prepared on an accrued expenditure basis. enter the
cumulative income earned to date. Undet" either basis.
enter only the amount applicable to progT1lm income
that WllS required to be used lor the project or pro-
Irem by the tenns of the grant or other agreement.
lid Only when making requests for advance JJ8yments,
enter the total estimated emount 0( cash outlays that
will be made during the period covered by the advance.
13 Complete the certification before submitting this
request.
A-110:11
"I
I
I
Office of Management and Budget Circular A-110 (7/30/76)
Approved by Office of Management and PAGE OF
OUTLAY REPORT AND REQUEST FOR REIMBURSE. Budget. No, Bo-ROlal rAGES
MENT FOR CONSTRUCTION PROGRAMS 1. TYPE 0' REQUEST 2. 8ASI$ Of REQUEST
(See ;nltnLet;Q1U 01'& back) o "NAL o PARTIAL o CASH o ACCRUAL
3. fEDERAL SPONSORING AGENCY ANO ORGANIZATIONAL UEM[Hf TO .c. fEDERAL GRANT OR OTHER s.. PARTIAL PAYMENT REQUEST NO.
WHICH THIS REPORT IS SUShUn[D ID[NTlNINQ NUMBER ASSIGNED
BY fEDERAL AGENCY
L ~~~~OE~[R IDENTlF1CATION 17' REC'PIENT ACCOUNT OR OTHER "IIIOD COW[Jt[D IT nus .PUn
IDENTlfYlNO NUMBER
rRO" (N~ tpa... ......) TO(..~............)
I. RECIpIENT OR0AN1ZATlON 10. PAYU 1~__II""""k""'"~..,""",,,,,,,,)
H_ : H_ :
No. .... Ho.~
SI_ : Str... :
cu... CUr.
StGU OM St,.."__
1!IP Cod.: ZIP Cod. :
11. STATUS OF FUNDS
PROGRAMS-FUNCTIONs--ACTIVITI ES
CLASSIFICATION fa) (b) (e) TOTAl
e, Admlnlstrattve expense $ $ $ , $
b. Preliminary expense
c. Lend, structures, right'ol'wey
d. Architectural engineering beslc Ieeo
e. Other erchltecturel engtneering lees
I. Project Inspection lees
g, land development
h, RelocetJon expense
I. Relocation payments to Individuals and
businesses
J. Demolition and removal .
k. Construction and project Improvement
cost
I. Equipment
-
m. Miscellaneous cost
n, Total cumulative to date (sum o""-li""
e thru m)
0, Deductions for program Income
p. Net cumulative to date (Line n minus
line 0) ,
q, Federal share to date
r. Rehabilitation grants (100% reim.
bursement)
s, Total Federal share (sum of lines Q
end r)
t. Federal payments previously reo
quested
u, Amount requested for reimbursement $ $ $ $
v, Percentage of physical completion of %
project % % %
12, CERTIFICATION SIGNATURE 0' AlJTHORIIED CERTIfYING DATE REPORT
OffiCIAL SUBMITTED
I certify thetlo tho best of my knowledge
Bnd belief the billed cosh or disburse- e, RECIPIENT TYPED OR PRINTED NAME AND TITLE TELEPHONE (A,.. eocM.
ments are in accordance with the terms ....,..,. ..... at.......)
of the project and that the reimbursement
represents the Federal share due which SION" TUR[ 0' AlJTHOAIIEO CERTlFYINQ OAT[ SIGNED
has not been previously requested and OffiCIAL.
that an inspection has been performed b, Representative
and all work is In accordance with the certifying to line TYPED OR PRINTED NAME AHD TITLE TElEPHONE (A.._ oocI.
terms of the award. II v, ",.-.11.,. .... _~)
271-101
EXHIBIT 4
STANDARD FOA" 271 (7-16)
~',~~~~ ~by. f!..tfIe~ .o.'A Man_..ment .nd Bu~
A-110:12
,
I
I
Office of Management and Budget Circular A-110 (7/30/76)
INSTRUCTIONS
Please type or print leglbly. 118m. 3. 4. 5, B. 9. 10, lIs, and 11 v 1In1 self-expIIlMtOry; specific instructions
tor other Items _ ~ follows:
It.... ...try
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ood. If requ_ ~ the fed..... _J,
7 '"'Is '1'8" .. reMrVed for an aecount number or ether
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11. Enter other _Itectu'" onp.oori"ll _, Do not
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-- .....-.
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mont normoIIy __ with ....jor __
- M __ '"'"' _ -88OIY _ .nt_ on
_It.
Ilh _ _ _ _ _ '" .......... _
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_ ... iAd....... ... _"'own on _ .,
lli [mer .... amount eI _loA """'"""ts ..... ~ the
rec:ip&ent k> .Uspbeed ,.,-.0"'. tarms. businea. con.
cerns. and nonproM orwaniutiona.
1_ .~
II' ~ _ ..I.fin .nd __ of .mploy... of the
raclpIent .nd peyments 10 ttwnl perty contractors di,
PIICtIy ~ in performing demotttion Of' ,~I of
structuras ""'"' d<NoIoped lend, All procead. Irom th.
..... of eeIwetle '" the _I of structur.. Ihould be
_ed to t" account; thereby ..lIecting net
.mounts if _Heel by u.. Federalllll.ney,
Ilk E_r _ ...-nts .uocieted with the actu.1 con,
*vction of. addidoft ~. 'Of' restoration of II facility.
Ana, In<:IuM in this ~, the amounh lor proJact
tmpRJYel"nenb 8WC" as MW'erR. streets, le,.tJeea pi "8.
- ~rc.
111 Ent.... a""",nts lor .11 oqutpmeAt. both IIxed and may,
.bIe, 8OlC1u_ of _Ip"","t...., lor con.truclion, for
example. ....nna....ntly attached Ieboratory tebl.., built,
In _io vleuol -,a........ ..OYllble desks, chairs, .nd
IlIboratory -iPrMAt.
11... _ _ _nts lor ell ","",I not .peclllcatly m.n'
-_.
II" Enter the tDtaI cumv...tiw af1lM)UM to dete which
IOheuId ...__o'......lhl'OUlfh m,
n. _ the _ .mount of P"'llram Income applied to
_ lrant '" controd ...-m.nt ,""copt Incom. In,
01_ _ _ J, Idenllly on . .opa...l. .heel of paper
the ooun:os.nd typoe of 11M I..........
11, _ the _ cumulatiw .mount 10 det. which .hould
... the arrllMHlt shewn on Hne n minus. the amount
_If MO.
l~ __ the __ _.. of _ emount .hown on II.... p,
11r Enter"'" _ of __on ...nt paymentl
_to I_h wtMtn p.......m Iegi.lellon provides
100 ....- ~ ~ the Fodoral _cy.
lit Ent... the _ _ of F_.... payments prwlously
---. If _ ""'" _ _ lor ___I relm,
Ilot.-.ont.
n.. _ the __"01 now bel... rwq_ "'" _....'
"'eM- 11* ..,.....,.. thouId No the tliftefenc. between
the ~ ........ .... linN .. and t. If diff....nt. ex-
...... -. ----
a. To M ownpIetad by the ~ oII\clef who is r.,
.......... ..... ttM op<<ation of 1Ih. pt"OfJram. The date
- ... the _ _. the ""'" I. .ubmilled to Ih.
f_ ....-qo.
I2aI To be -..pt_ by the oIIIdal ...p....nt.tt""
who .. certtfyinc &0 the pen>>nt of pro;ect completion
as preYided tor in the IlItms of the .Nnt Of" alrwement,
A-110:13
'\
I
Office of Management and Budget Circular A-110 (7/30/76)
ATTACHMENT H,-CrRcULAR No. A-I10
MONrI'ORING AND REPORTING PROGRAM
PERFORMANCE
L This attachment sets forth the proce-
dures for monitoring and reportlng program
performance of recipients,
2, Recipients ~hall monitor the performa:lce
under grants and other agreements and,
where appropriate, ensure that tlme sched-
ules are being met, projected work units by
tlme periods are being accomplished. and
other 'performance goals are being achieved,
This review shall bo made for each program,
function, or activity of each agreement as set
forth In the Ilopproved appllcatlon or award
document,
3, Recipients shall submit a performance
report (technical report) for each agreement
that brlefiy presents the following Informa-
tion for each program, function, or l1ctlvlty
Involved as prescribed by the Federal. spon-
soring agency:
a, A comparison of actual accompllshments
with the goals established fo.r the period, the
findings of the Investlgaoor, or both. If the
output of programs or projects can be readily
quantlfied, such quantitative data should
be related to. cost data for computation of
unl t costs,
b. Reasons why established goals were not
met,
c. Other pertinent Information Including,
when l1pproprlate, analysis and explanation
of cost overruns or high unit costs.
, 4. Except as provided In a and b .below,
and In subparagraph 3a(1), Attachment G.
recipients shall submit the performance or
technical reports to Federal sponsoring agen-
cies and the Financial Status Reports cov-
ering the same period In the frequency estab-
lished by Attachment G of this Circular and,
where approprlnte, 11 final technical or per-
formance report after completion o! the
project on a date specified by the Federal
sponsoring agency, The Federal sponsoring
agency shall prescribe the frequency with
which the performnnce reports will be sub-
mitted with the request for advance or reim-
bursement when that form Is used In lieu
of the Financial Status Report, Except as pro-
vided for In paragraph 5 below, performance
reports shall not be required more frequently
than quarterly or less. frequently than an-
nually. Federal sponsoring agencies may
waive the requirement for recipients to sub-
mit performance reports with the financial
reports under the following circumstances:
a, When the recipient Is required 00 sub-
mit. a performance report with a continua-
tion or renewal application,
b~ When the Federal sponsoring agency de-
termines that on-site technical Inspections
and certified completlon d..tn will be suffi-
cient to evaluate construction projects,
c, When the Federal sponsoring agency re-
quests annual financial reports on a fiscal
year basis but It Is necessary 00 get annual
prcgress reports on a calendar year basis,
5. Between the required performanr:e re-
porting dates, .events may occur that have
significant Impact upon the project or pro-
gram, In such Instances, the recipient shall
Inform the Federal sponsoring agency as soon
as the following types of conditions become
known:
a, Problems, delays, or adverse conditions
that will materially affect the ability 00 at-
tain program objectives, prevent the meet-
Ing of time schedules and goals, or preclude
the attainment of project work units by es-
tablished time periods, This disclosure shall
be accompanied by a statement of the action
ta.ken, or contempla.ted, and any Fedcral as-
sistance needed to resolve the> situation,
b. Favorable developments or events that
enable time schedules 00 be met sooner than
anticipated or more work units to be pro-
duced than originally projected,
6, If any performance review conducted
by the recipient discloses the need for change
In the budget estimates In accordance with
the criteria establlshed In Attachment J Co
this Circular. the recipient shall submit a re-
quest for budget revision,
7, The Federal sponsoring agency shall
make site visits as frequently as practicable
00:
a. Review program accompllshments and
management control systems, and
b. Provide such technical assistance as
may be required.
8. Federal sponsoring agencies shall submit
proposed technical and performance reports
to the Office of Management and Budget for
approval In accordance wi th the report clear-
ance requirements of OMB Circular No, A--40
as revised,
ATTACHMENT L-<)mcuLAR No. A-110
PAYMENT REQUIREMENTS
L This attl\Chment esta..bJlshes the re-
quired methods of making payments to recip-
Ients, These methods will minimize the tlme
elapsing between the disbursement by these
recipients and the transfer of funds from the
United States Treasury to these recipients
whether such d'lsbursement occurs prior to
or subsequent 00 the transfer of funds,
2, Payments can be made to recipients
through a letter-of-credlt, an advance by
Treasury check, or a reimbursement by Treas-
sury check. The following definitions apply
for the purpose of this attachment:
a. Letter-o/-Credit.-A letttr-of-credlt 15
an Instrument certified by an authorized offi-
cial of a Federal sponsoring agency that au-
thorizes a recipient 00 draw funds when
needed from the Treasury, through a Fed-
eral Reserve bank and the recipient's com-
mercial bank, In accordance with the provi-
sions of Treasury Circular No, 1075, as re-
vised,
,b, Advance by Treasury cheC".-An ad-
vance by Treasury check Is a payment made
by a Treasury check to a recipient upon Its
request before outlays are made by the
recipient, or through the use of predeter-
mined payment schedules.
c, Reimbursement by Treasury chec",-A
reimbursement by Treasury check Is a Treas-
ury check paid 00 a recipient upon request
for reimbursement trom the recipient,
3. Except for construction grants and
other construction agreements for which op-
tional payment .methods are authorized. as
described In paragraph 5, the letter-of-credit
method shall be used by Federal sponsoflng
agencies If all of the following condltlons
exist:
a, If there Is or wUl be a contlnulng rela-
tlonshlp between a recipient and a Federal
sponsoring agency for at least a 12-month
period and the total amount of advance pay-
ments expected to be received within that pe-
riod from the Federal sponsoring agency Is
$250,000 or more, as prescribed by Treasury
Circular No, 1075, For Joint funded projects
the Treasury has authorized a dollar criteria
of $120,000, .
b, if the recipient has established or.dem-
onstrated to the Federal sponsoring agency
the willingness and abIlity 00 maintain pro-
cedures that will minimize the time elaps-
Ing between the transfer of funds and their
disbursement by the recipient,
c, If the recipient's financial management
system meets the standards for fund control
and accountability prescribed In Attachment
F to this Circular, "Standards for Financial
Management Systems."
4, The method ot advancing funds by
Treasury check shall be used, In accordnnce
with the provisions of Treasury Circular No.
I
A-110:14
1075, when the recipient meets all of the re-
quirements specified In paragraph 3, above,
except tho.e In subparagraph 3a,
5, The relmbursemrnt by Treasury check
method shall be the preferred method If the
recipient does not meet the requirements
specified In subparagraphs 3b and 3e, above,
At the option ot the Federal sponsoring
agency, this method may also be used on any
constructlon agreement, or If the major por-
tlon of the program 15 accomplished through
private market financing or Federal loans,
and the Federal assistance constitutes a
mlllor portion of the program, When the re-
Imbursement method 15 used, the Federal
sponsoring agency shall make payment
within thirty days after receipt of the billing,
unless the bllllng 15 Improper,
6. When the letter-of-credlt procedure Is
used, the recipient shall be Issued one con-
solidated letter-of-credlt. whenever possible
to cover antlcipated cash needs for all grants
and other agreements awarded by the spOIl-
sorlng agency, Likewise, 00 the extent possi-
ble, when the advance by Treasury check
method Is used, advances should be cun-
solltlnted (pooled) for all grants and other
agreements made by the sponsoring agency
to that recipient, . ,
7, Unles3 otherwise required by law, Fed-
eral sponsoring agencies shall not wi thho1d
paym~nts for proper charges made by recipi-
ents at any tlme during the project or pro-
gram period unless (a) a recipIent has failed
to comply with the program objectlves, award
condltlons, or Federal reporting require-
ments; or (b) the recipient Is Indebted. 00
the United States, and collectlon of the In-
debtedness will not Impair accomplishment
of the objectlves of a project or program
sponsored by the United States,
Under such condltlons, the sponsoring
agency may, upon reasonable notlce, Inform
the recipient that payments will not be m&de
for obllgatlons Incurred aiter a specified date
until the conditions are corrected or the In-
debtedness 00 the Federal Government Is
liquidated,
ATTACHMENT J,-<)meuLAR No, A-110
REVISION OF FINANCIAL PLANS
L This attachment sets forth criteria and
procedures to be followed by Federal spon-
soring agencies In requiring recipients 00 re-
port 'deviations from financial plans and 00
request approvals for financial plan re~
visions,
2, The financial plan Is the financial ex-
pression of the project or program as ap-
proved during the appllcatlon and/oI' ,.ward
process. It may Include either the Federa\ and
non-Federal share, or only the Federal share:
depending upon sponsoring agency requlr~-
ments, It should be related to performance
for program evaluation purposes whenever
appropriate and required by the Federal
sponsoring agency,
3, For nonconstructlon awards, recipients
Ehall Immediately request approvals from
Federal sponsoring agencies when there Is
re3son 00 belleve that within the next s~ven
days a revision wlll be necessary for the
following reasons:
a, Changes In the scope or the objective of
the project or program,
b, The need for additional Federal fund-
Ing,
c, The transfer of amounts budgeted fer
Indirect costs to absorb Increases Indirect
costs or vice versa, It approval 15 required
by the Federal sponsoring agency,
d, The expenditures as require approval In
accordance with FMC 73--8, "Cost Principles
for Educational Institutions," For all other
awards, approval requirements for other
Items of expenditures may be Imnosed If they
are consistent with those In FMC 73--8, No
other requirements for specific Items may be
I
Office of Management and Budget Circular A-110 (7/30/76)
Imposed unless a deviation has been ap-
proved by the Office of Management and
Budget,
e, Recipients plan to transfer funds allotted
for training allowances (direct payments to
trainees) to other categories of expense.
4, None of the substantive programmatic
work under a grant or other agreement may
be subcontracted or transferred without prior
approval of the Federal sponsoring agency,
This provision does not a-pply to the purchase
of supplies, material, equipment, or general
support services.
5. The Federal sponsoring agency may
also, at Its option, restrict transfers of fundB
lloffiong direct cost categories for awardB In
which the Federal sba.re exceeds $100,000
when the cumulative amount of such traru;-
fers exceeds or Is expected to exceed five
perGBnt of the total budget as last o.pproved
by the sponsoring agency, The same criteria
shall a-pply to the cumulative amount of
transfers among progra4Dfl, functions, 8nd
aotlvltles when budgeted separately for an
award, except that the Federal sponsoring
agency &haJl perm.Lt no transfer that would
cause any Federal approprla.tlon, or part
thereof, to be used for purp06e6 other than
those Intended, .
6. All other changes to nonconstructlon
budgets,except. for the changes described
In paragraph 8, below, do not require ap-
proval. This Includes the use of recipient
funds In furtherance of program objectives
over and above the recipient mln1mum share
Included In the a.pproved budget.
7. For construction awards, recipients
shall request prior a-pprovals promptly from
Federal sponsoring agencies for budget re-
visions wherever:
0:, The revision resul ts from changes In
the scope or the objective of the project or
program, and
b. The revision Increases the budget
amounts of Federal funds needed to com-
plete the project.
8, When a FederaJ sponsoring agency
makes an award that provides support,for
both construction and nonconstructlon work,
the Federal sponsoring agency may require
the recipient to request prior approva.J from
the FederaJ sponsoring agency before m1klng
any fund or budget tr./lnsfers between the
two types of work supported,
9, For both construction and nonconstruc-
tlon awards, Federal sponsoring agencies
sh.aJI require recipients to notify the Fed-
eral ~p::msorlng agency promptly whenever
the amount of Federal .authorlzed funds Is
expected to exceed the needs of the recipient
by more than $5,000 or five percent of the
Federal award, whichever Is greater, This
notification wUl not be required If applica-
tions for additional funding are submitted
for continuing grants or contracts,
10, When requesting approval for budget
revisions, recipients shall use the budget
fonus thit were used In the application
unless a letter request will suffice,
I L WI th In 30 calendar days from the date
of receipt of the request for budget revi-
sions, Federal sponsoring agencies shall re-
view the request and notify the recipient
whether the budget revisions have been ap-
proved, It the revision Is stili under con-
sideration at the end of 30 calendu days,
the Federal sponsoring agency shall Inform
the recipient In writing of the da.te when the
rec1plent may expect the decision,
A'ITACHMENT K,-CIRCULAa No, A-lIO
CLO,SEOUT PROCEDURES
L This attachment. prescribes uniform
closeout procedureS for Federal grants and
other agreements with recipients.
2. The following definitions shalI apply for
the purpose of this attachment:
a. C/O$eout.-The closeout of a grant
agreement Is the process by which a Federal
sponsoring agency determines that aJI ,ap-
plicable administrative actions and aJI re-
quired work of the agreement have been
completed by the recipient and the Federal
sponsoring agency,
b. Date of completion.-The date of com-
pletion Is the date on which aJI work under
grants and other agreements Is completed or
the date on 'the award document, or any
'supplement or amendment thereto, on which
Federal sponsorship endB,
c. Duallowed co3b.-D\sallowed costs are
those charges to a grant or other agreement
that the FederaJ sponsodng agency or Its
representative determines to be unallow-
able, In accordance with the applicable Fed-
eral cost principles or other conditions con-
tained In the agreements,
3. AII FederaJ sponsoring agencies shall es-
tablish closeout procedures that Include the
following requirements:
a, Upon request, the Federal sponsoring
agency shall make prompt payments to a
recipient for allowable reimbursable costs
under the grant or other agreement being
closed out,
b, The recipient shall immediately refund
any balance of unobligated (unencumbered)
c!lSh that the Federal sponsoring agency has
advanced or paid and that Is not authorized
to be retained by the recipient for use In
other grants or other agreements.
c, The Federal sponsoring agency shall ob-
tain from the recipient within 90 calendar
days after the date of completion of the
agreement all financial, performance, and
other reports required as the condition of the
agreement. The agency may grant extensions
when requested by the recipient.
d. When authorized by the grant or other
agreement, the Federal sponsoring agency
shall make a settlement for any upward or
downward adjustments to the Federal share
of costs after these reports are received,
e, The recipient sh.all account for any prop-
erty acquired with Federal funds, or re-
ceived from the Government In accordance
with the provisions of Attachment N to this
Circular, Property Management Standards,
f. In the event a final audit has not been
performed prior to the closeout of the grant
or other agreement, the FederaJ sponsoring
'11.gency shaJl retain the right to recover an
appropriate amount after fully considering
the recommendations on disallowed coots re-
sulting from the final audit,
4. Suspension and termination procedures
are contained In Attachment L to this Cir-
cular.
ATI'ACHMENT L,-CmcuLAR No. A-110
SUSPENSION AND TERMINATION PROCEDURES
1. This attachment prescribes uniform
suspension and termination procedures for
Federal grants and other agreements with
recipients,
2, The following definitions shall apply
fer the purpcse of this attachment:
a, Termination,-The termination of a
grant or other agreement means the can-
cellation of Federal,sponsorshlp, In whole or
In part, under an agreement at any time
prior to the date of completion,
b, SlL.'lpC113ion,-The suspension of a grant
or other agreement Is an action by a Federal
sponsoring agency that temporarUy sus-
pends Federal sponsorship under the grant
or other agree~ent, pending corrective ac-
tion by the recipient or pending a decision
to terminate the grant or other agreement
by the FederaJ sponsoring agency,
~. All Federal sponsoring agencies shall
provide procedures to be followed when a
recipient has faUed to comply with the terms
I
A-110:15
of 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: suspen,d the
grant or other agreement, and withhold fur-
ther payments, prohibit the recipient from
Incurring additional obligations of funds,
pending corrective action by the recipient, or
a decision to termination In accordance with
paragraph 4, The FederaJ 6ponsorlng agency
shall aJlow all necessary and .proper costs
that the recipient could not reasonably avoid
during the period of suspension provided that
they meet the provisions of the applicable
Federal cost principles,
4, Federal sponsoring agencies shall pro-
vide for the systematic settlement of ter-
minated grants or other agreements Includ-
Ing the following:
a. Termination for cause.-The Federal
sponsoring agency may reserve the right to
terminate any grant or other agreement In
whole or In part at any time before the date
of completion, whenever It Is determined that
the recipient has failed to comply with the
conditions of the agreement, The Federal
sponsoring agency shall promptly notify the
recipient In writing of the determination and
the reasons for the termination, together
with the effective date, Payments made. to
recipients or recoveries by the Federal spon-
sorng agencies under grants or other agree-
ments terminated for cause shall be In ac-
cordance with the legal rights and liabilities
of the parties,
b, Termination for convenienee.-The Fed-
eral sponsoring agency or recIpient may ter-
minate grants and other agreements In whole
or In part when both pa.rtles agree that the
continuation of the project would not pro-
duce beneficial results commensurate with
the further expenditure of funds. The two
parties shall agree upon the termination con-
ditions, Including the effective date and, in
the case of partial terminatIons, the portion
to be terminated, The recipient shall not
Incur new obJlgatlons for the terminated por-
tion o.rter the effective date, and shall can-
cel as many outstanding obligations as pos-
sible, The Federal sponsoring agency shall
allow full credit to the recipient for the
Federal share of the noncancellable obliga-
tions, properly Incurred by the recipient prior
to termination,
ATI'ACHMENT M.-CIRCULAR No, A-lIO
STANDARD FORM FoR APPLYING FOR
FEDERAL ASSISTANCE
1. This attachment promulg"tes a stand-
ard form (SF 424) to be used by public and
.prlvate InstltutloD$ of higher education,
pubJlc and private hospitals and othl!r quasl-
public and private nonprofit organizations as
a face sheet for applications when applying
for Federal grants under programs covered
by Part I, Attachment A, OMB 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 form Is now required by
FMC 74-7.
2, The SF 424 may also be used, on an op-
tional basis, to fulfill the requirements of
OMB Circular A-95 for a notlficRtlon of In-
tent, from applicant to clearinghouses, thOot
Federal assistance will be appJled for, LocOol
or State clearinghouse procedures wUl govern
the use of the form for this purpose,
3, The standard form wl\1 also be used by
Federal agencies to report to the clearing-
houses on major actions taken on ll.!>pllca-
tlons reviewed by clearinghouses In accord-
ance with OMB Circular A-95, and to notify
States of grants-In-aId awarded In accord-
ance with Treasury Circular 1082.
I
Office of Management and Budget Circular A-110 (7/30/76)
I
A-110:16
OMB Approval No, Z')-R()211
FEDERAL ASSISTANCE L M'PlI, .. IlUIII BER 3. STAn: ., 1l\JUBER
Al'PUC>\-
eANT'S nON
1. TYPE o PREAPPlICATION APPU, .. IJATl ID!H1l- .. OATl r..... _II, ....
OF eATIOtt r_ -.. ...... "IVI
ACTION o N'I'lIOATJON 19 ASSIGHED 19
(M_ .p- o NOTIflCATIOft OF INTDCT ('Opl) Leo..
r:r-u n. REPORT Of FEDERAl ACTIOft lJIa...
4. LEGAL APPLICANT/RECIPIENT 5. f~DI!RAL EMPLOY'"' IDetITI'I'ICATlON NO,
o. Applicant H..... :
.. O"lniuUoo Uolt : 6. I I \- I I I I
c. 51,HI/P.O, 8<ll : PRO, ., HUMBER
d, City L eouoty GRAM b, TlTH
: :
I. ,_ I. ZIP eod.: (Fr9'"
: ,. ecI.....z
h. Conl..t P..... (No_ Oolrolo4l'1
c .. ,...,."..... 1'10.) :
a 7. TITLE AND DESCRII"TION OF APPlICANrl PROJECT 8. TYF't Ot' JlPPI.ICAHT/RECIPIENT
5 1>-$tato II-&mmuorty A<tl... "-
B-l_ta .." I- HI~hlr EducalionOt _lluUon
I C-Subatata . }-Ind... Tribe
o l.mot ~. (S,..clfll):
!>-County
E-Clty ,
f- $eIlool Olftttel
~1':1" ...~ S"IM .1't"'.,.......I. NII..- 0
~ D let
'" TYF't 01' ASSISTANCE:
.......1. G....t 0-...."'.....
i &-Suppl."" ...'" Ii-ethlr .'"tn- G~ IT]
e...-Lo.R "";"1. 1e11M(.) .
10. AREA Of PftOJBCT IMPACT (N....... 01 -, .---. 11. ESTljf,.Y U. TYPE: Of APPi.teATlON
SIou.. .,) BER aNI _... C-R..I.1olI (-'AIlI_taU...
B1l.H TIN .....n....' D-tonUo..tlon Eftt..,. .ppropria,t. l.tUr 0
13, P~EO fUN-DI NQ 14. CONGIUSIfoNAL DISTRICTa Of: 15. TYPE Of CHANCE (For U. ... JSo)
, .. APPUOAHT II. '1lO1M't 1>-lnc..... DoM... ~thet (Sp.rifll):
., flIDER"l .00 ~_..... Dall.n
&-Inc...... Ou....1\lo
b, APPLICANT .09 &-I)ou.... Il""U...
16. P~JECT START 17. PftQJECT (-Coocoll.t1..
c, STATE ,00
OA I; Y 00' -a. do1/ DURATION /I",," Gppro-- rn=J
d, lOCAl. .00 19 M....fJu priol4 letlor(.)
., OTHER .00 11. ~S'TI_TI:O DATli TO r_ """"'" doll 19. EXISTING PEDERAL IDENTIFICATION N\JMBER
BE SU9MltTED TO
I. TOTAL $ ,00 fEDERAL AGENCY ~ 19
20. fEDERAL AGENCY TO RECEIVE REQUEST (JlLf_, C,.. ,,_ ..,,. ....N.I 21. REMARKS ADDED
n Yes 0 No
! 22. ., To Ihe boot 01 In)' knowladc. .nd MlloI. ., H 't ., OMB Cir<:ul.r 1>-" tMt .:e"'" wo. .-IIIad, pu......nl .. i., No r.- RNJ'O'U<<
dill i. thia ...-p1icctlon/.ppllcall.. .r. atnlet U1....ln... IPproprilt. ,IM,I". lei ...d an 'MponatS I'" .tta~ed: .J><>ftO. ..1""'Me!
B THE true and cor'Ht. lbl ~m...t h.. .....
;;: APPLICANT dulv .uthorl.ad br u.. loY<<1Iinc bodr eI 0 0
B CERT"'IES thl .pplicant .nd dI. .ppli.... will -... (I)
THAT ~ with thl ....cM4 _.... " tM 8UI.. III 0 0
1 In.. .. IPPnrY.d. Ul 0 0
.
! 23. ., TYPW HAIl! AHO TITlE .. II"""TURE .. DATE SIGHED ..,-
CERTIFYING Yoor ...4HOth dG..-
i REPM. 19
SENTATlVE 1
24. AQ~NCY NAME: U. APPLICA, r_ -- ....
TlON
RECENED 19
26. ORGANIZATIONAL UIi1T 17. ADMINISTMt.TIV~ OfflC~ 26. fEDERAL APPLICATlDN
i IDENTIFICATION
29. AOORESS 10. fEDERAL GRANT
i IDENTIFICATION
g 31. ACTION TAKEN JL JUNDINCI r_ woawtI. .... 14. r ...r """"'" ....
I o ., AWAAOEO ., '!MML $ .00 n. ACTION DATI. ~ Sf ART,"O
19 DATE 19
~ o .. REJlCTIO .. APl'ltCNlf .00 JL ~TM:T FO<< AOOITIOHAL IHfORMA' H. r..... ...4HOth .....
ION (N..... ~ ...~ ...........) ~NDING
o c. IlETUMIIO POll c. S'f"T[ .00 DATE 19
AMEHDt.t!HT d, low. .00 37. REMARKS ADDED
! o d. OEI'lIRRED ., 0fllItI .00
t o .. W1TllDAAI'ffl o Y.. oNo
:c I. lOTN. $ .00
38- ., I. lakin, ...... oollon. ..., __II _Iwd fro", d.rinr:-- -- _. ., nDERAL MEIlCY 1>-95 OffiCIAL
fEDERAL AGENCY old"..., II .I"'~" I. d.. ..or ,...lol_ eI I'o<t 1.,0 8 CII""'... A--ll6, .Ho.... ....! Nkp/w>tol "".)
It .... .... or 10 _..
A-95 ACTION
BTANDARO FORM 424 PAQ~ 1 0D-71M
,) ,-
I
I
Office of Management and Budget Circular A-110 (7/30/76)
A-110:17
SECTION IV-REMARKS (PleCllle referenu tM proper ium number from Sectw-n. I, II or III, if applicabu)
'\
STANDARD FORM 424 PAGE 2 (10-75)
I
I
Office of Management and Budget Circular A-110 (7/30/76)
A-110:18
GENERAL INSTRUCOONS
This is a multi-purpose standard form. 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).
APPUCMO" PROCEDURES FOR SECTION 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 back of the form. An explanation follows for each item:
Item
1.
2a.
2b.
3a.
3b.
4a-4h.
Mark appropriate bolt. Pre~ppllcatiQn and appllca.
tion guidance is in FMC 74-7 and Federal agency
prl>f{ram instructions. Notlficlltion of intent RUid-
ance is in Circular 1\-95 procedures from clear-
inghouse. Applicant will not use "Report of Federal
Action" box.
Applicant's own . control number, If desired.
Date SectIon lis prepared.
Number aSGlgned by State clearinghouse, or If de1e-
gated by State, by areawide clearinghouse. All re-
quests to Federal agencies must contain this Identi-
fier If the program Is covered by Circular A-95 and
required by applicable. State/areawide clearing-
house procedures. If in doubt, consult your deer-
inghouse.
5.
Date applicant notified of c1O(1ringhouse identifier.
legal name of applicant/recipient, name of primary
organizational unit which will undertake the assist-
ance activity, complete address of applicant, a~
name and tolephone number of person who can pr0-
vide further information about this request.
Employer identification number of applicant as as-
signed by Internal RllV8nue ServIce.
Use Catalog of Federal Domestic Assistance num-
ber assigned to program under which assistance is
requested. If more than one program (e.g., joint-
funding) write "multiple" and explain in remarks.
If unknown, cite Public Law or U.s. Code.
Program tItJe from Federal Catalog. Abbreviate If
necessery.
Brief title and appropriate description of project.
For notifiCtltion of intent, continue In ramarks sec-
tion if necessary .to convey proper description.
Mostly self~llplanatory. "City" includes town, town-
ship or other municipality.
Check the type(s) of assistance requested. The
definitions of the terms are:
A.. Basic Grant. An original request for Federal
funds. This would not Include any contribution
provided under a supplemental grant.
B. Supplemental Grant. A request to Increase a
basic grant in certain ca5e$ where the eligible
applicant cannot supply the required matching
share of the basic Federal program (e.g_, grants
awarded by the Appalachian Regional Commis-
sion to provide the applicant a matching share).
C. loan. Self explanatory.
68.
6b.
7.
8.
9.
'tem
10.
11.
D. IMUrance. Self explana~ry.
E. Other. Explain on remarks page.
Governmental' unit where Bignlf\cant and meaning-
ful impact could be observed. list only largest unit
or units affected, such as State, county, or city. If
entire unit affected, list It rather than subunits.
Estimated number of persons directly benafiting
from project.
Use appropriate code Ietbtr. Definitions are:
A.. N_. A submittal for the first time for a n_
project.
B. Renewal. An extension for an additional funding/
budget period for a project having no projected
completion date, but for which Federal support
must be renewed each year.
C. Revision. A modification to project nature or
scope which may result In funding change (in.
crease or decrease).
D. Continuation. An extension for an additional
fundlns/bud8et period for a proJec.t the agency
initially agreed to fund for a definite number of
yaars.
E. /wgmenbltion. A requirement for addltionlsl
funds for a project previously awarded funds In
the same funding/budget period. Project na,ture
and scope unchanged.
Amount requested or to be corib1buted during ,the
first fundlng/budgM period by each contribut!lr.
Value of In-kind contributions Will be Included. If
the action Is a change in dollar amount of an exist.
ing grant (a revision or augmentation), indicate
only the amount of the change. For decreases en.
close the amount in parentheses. If both basic and
supptenlental amounts are included, breakout in
remarks. For multiple program funding, use totals
and show program breakouts in remarks. Item defi.
nltions: 138. amount requested;from Federal Gov'
ernment; 13b, amount applicant will contribute;
13c, amount from State, if applicant is not a State;
13d, amount from local government, if applicant is
not a local government; 13e, amount from any other
sources. explain in remarks.
12.
13.
14a.
14b.
Self explanatory.
The district(s) where most of actual work will be
accomplished. If city-wide or State-wide, covering
several districts, write "city-wide" or "State.wide."
Complete only for revisions (Item 12c), or augmen-
tations (Item 120).
15.
STANDARD FORM 424 PAGE 3 (10-75)
J
,
Office of Management and Budget Circular A-110 (7/30/76)
A-110:19
Item
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 ai'll available.
Estimated date preapplicatlon/appllcatlon will be
submitted to Federal agency If this project requires
clearinghouse review. If review not required, this
date would usually be same as date in Item 2b.
Item
19.
Existing Federal Identification number If thiS Is not
a new request and directly relates to a pravlous
Federal action. Otherwise write "NA".
Indica'te Fedel'lll agency to which this request Is
addressed. Street addl'llss not required, but do use
ZIP.
20.
21.
Check appropriate box as to whether Section IV of
form contains nlmarks and/or additional nlmarks
are attached.
APPLICANT PROCEDURES FOR SECTION 1\
Applicants will always complete Items 23a, 23b, and 23c. If clearinghouse review Is required, Item 22b must be fully com.
pleted, An explanation follows for each item:
Item
22b.
238.
Ust clearinghouses to which submitted and show
In appropriate blocks the status of their responses.
For mol'll than three clearinghouses, continue In
nlmarits section. All written comments submitted
by or through clearinghouses must be attached,
Nt me and title of authorized representzltive of legal
applicant.
Item
23b.
Self explanatory.
23c.
Self explanatory.
Note:
Applicant completes only Sections I and II. Section
III is completed by Fedel'lll agencies.
FEDERAL AGENCY PROCEDURES FOR SECTION III
Item
24.
Executive department or Independent agency having
program admlnistl'll~lon responsibility,
Self explanatory,
Primary organizational unit below department level
having direct progl'llm management responsibility.
Office directly monitoring the program.
Use to Identily non.award actions whenl Fed e I'll I
grant identifier in item 30 Is not applicable or will
not suffice.
Complete address of administering office shown In
Item 26.
Use to identify award actions where different from
Federal application identifier In item 28.
Self explanatory. Use remarks section to amplify
where appropriate.
Amount to be contributed during the fi~t 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 existing gl'llnt (a revi.
sion or augmentation), indicate only the amount of
change. For decreases, enclose the amount in pa'
rentheses. If both basic and supplemental amounts
are included, breakout in nlmarks. For multiple pro'
gram funding, use totals and show program break.
outs in rt'TTlarks. Item definitions: 32a, amount
awarded by Federal Government: 32b, amount ap'
plicant will contrihute; 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 othllf' sources, explain in
remarks.
Date ilctlon was taken on this request.
Date funds will become available.
If appUcant.supplied Information in Sections I and II needs no updating or adjustment to fit the final Federal action, the
Fed el'll I agency will complete Section III only. An explanation. for each Item follows:
25.
26.
27.
28.
29.
30.
31.
32.
33.
34.
ftem
35.
Name and telephone no, of agency person who can
provide mol'll information regarding this asslstzlnce.
Date after which funds will no longer be available.
Check appropriate box as to whether Section IV of
form contains Federal remarks and/or attachment
of additional remarks.
For use with A-95 action notices only. Name and
telephone of pe~on 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 considerations
.
A. Treasury Circular 1082 compliance. Fed el'll I agency will
assure proper completion of Sections I and III. If Section I
is being completed by Fedel'lll agency, all applicable items
must be filled in, Addresses of State Information Recep.
tion Agencies (SCIRA's) are provided by Treasury Depart.
ment to each agency. This form repl8ces SF 240, which
will no longer be used.
B. OMB Circular A-95 compliance. Federal 8gency 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 8nd the (TC 1082) SCIRA are the same
office, In such cases, the A-95 award notice to the Sta\e
clearinghouse will fulfill the TC 1082 award notice re'
quirement to the State SCI RA. Duplicate notification
should be avoided.
STANDARD FORM 424 PAGE 4 (10-75)
I
Office of Management and Budget Circular A-110 (7/30/76)
ArrACHMENT N,--CmcULAR No, A-110
PROPERTY MANAGEMENT STANDARDS
1. This attachment prescribes uniform
standards governing management of prop-
erty furnished by the Federal Government or
whose cost was charged to a project sup-
ported by a Federal grlUl tor otheragreemen t,
Federal sponsoring agencies shall require re-
cipients to observe these standards under
grants and other agreements and shall not
Impose additional requirements unless spe-
cifically required by Federal law, The recipi-
ent may use Its own property man~gement
standards and procedures provided It observes
the provisions of this attachment. This at-
tachment also applles to subreclplents as
referred to In paragraph 5 of the basic cir-
cular,
2, The following definitions apply for the
purpose of this attachment:
a, Real pTopcTty,-<<teal property means
land, Including land Improvements, struc-
tures and appurteno.nces thereto, but ex-
cluding movable machUlery 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 propertll,-Non-
expendable personal property means tangible
personal property having 0. useful life of
more than one year and an acquisition cost
of $300 or more per unit exempt that recip-
Ients subject to Cost Accounting Standards
Board regulations may use the CASB stand-
ard of ~OO per unit and useful Ilte of two
years, A recipient may use Its own definition
of nonexpendable personal property :provlded
that the definition would at least Include all
tangible personal property as defined above,
d. Expendable pe1'Sonal 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
thereof, Is no longer required for Its needs
or the discharge of Its re5ponslbllltles,
t. Acquisit10n cost oj purchased nonex-
pendable personal property,-Acqulsltlon cost
ot an Item ot purchased nonexpendable per-
sonal property means the net Invoice unit
price of the property Including the cost of
modifications, attachments, accessories or
auxlllary apparatus necessary to make' the
property usable for the purpose for which It
was acquired, Other charges such as the cost
of Installation, transportation, taxes, duty
or protective In-transit Insurance, shall be
Included.or excluded from the unit acquisi-
tion cost In accordance with the reclplent.s
regular accountlnr; practices,
g, Exempt propcrty,-Exempt property
means tangible personal property acquired In
whole or In 'part with Federal funds. and
title to which Is vested In the recipient with-
out further obllgatlon 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 sponsoring agency
with adequate authority,
3, Real property,-Each Federal sponsoring
agency shall prescrIbe requirements for re-
cipients concernIng the use and dlsp051tlon
of real property acqulred partly or wholly
under gran ts or other agreements, Unless
otherwise provided by statute. such require-
ments. as a minimum. shall ("Ontain t.he
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 of the project,'ns long as
It Is needed,
b, The recipient shall obtain approval by
the Federal sponsoring agency tor the use ot
real property In other projects when the re-
cipient determines that Lbe property Is no
longer needed for the purpose o[ the original
project, Use In other projects shall be Ilmlted
to thooe under other federally sponsored proj-
ects (Le" grants or other agreements) or pro-
grams that have purposes consistent with
those authorl:T.ed [or support by the Federal
sponsoring agency.
c. When the real property Is no lonr:er
needed as provided In a o.nd h above, the
recipient shall request disposition Instruc-
tions from the Federal sponsoring agency or
Its tuccessor Federal sponsorlnr: 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 after It compensates the Federal
Government In an amount computed by ap-
plying the Federal percentage of participa-
tion In the cost of the orlgtnal project to the
fair market value of the property,
(2) The recipient may be directed to sen
the property under guidelines provided by
the Federal sponsoring agency and pay the
Federal Government an amount computed
by applying the Federal percentage of par-
ticipation In the cost of the orlgtnal project
to the proceeds from &ale (after deducting
actual and reasonable selling and fix-up ex-
penses, l! any, from the &ales proceeds).
When the recipient Is authort:r,ed or required
to sell the property, proper &ales procedures
shall be establlshed that provide tor 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 perso7UJ1
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 ot the agreement
or when the property Is no longer needed.
the recipient shall report the property to
the Federal' sponsoring agency for further
agency utlllzatlon,
It the Federal sponsoring agency has no
further need for the property, It shall be
declared excess and reported to the General
Services Admlnlstrtlon, Appropriate disposi-
tion Instructions will be Issued to the re-
cipient after completion of the Federal
agency review,
5, Exempt property,-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
Federal Government for Its use or disposi-
tion except as provided In 60. below.
6, Other nonexpcndable property,-When
other nonexpendable tangible personal prop-
erty Is acquired by a recipient with project
funds, tI tie shall not be taken by the Fe:!-
eral Go..ernment but shall ..est In the re-
cipient subject to the followlng conditions:
a, Right to tran.,jer 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
I
A-110:20
Government or. to a third party named by
the Jo'ederal Government when such t.hlrd
party Is otherwise eligible under existing
statutes, Such reservation shall be subject to
the following standards:
(I) The property shall be approprlat.ely
Identified In the grant or other agreement
or otherwise made known to the recipient
In writing,
(2) The Federal sponsoring agency shall
Issue dlsposl tlon Instructlons wi thin 120 cal-
endl\r days after the end of the Federal sup-
port of the project for which It was acquired,
H the Federal sponsoring agency falls to Issue
disposition Instructions within the 120 cal-
endar day period, the recipient shall apply
the standl\rds of subparagraphs 6b and Gc
as appropriate.
. (3) When the Federal sponsoring agency
exercises Its right to take title, the personal
property shall be subject to the provisions
for federally-owned nonexpendable property
discussed In paragraph 4, above,
(4) Whe.p title Is transferred either to the
Federal Govenunent or to a thlrd party the
provisions of subparagraph 6c(2) (b) should
be followed,
b. Use oj other tangible nonexpendable
property jor which the recipient has tttle,
(I) 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 tor the original proJect or program,
the recipient shall use the property In con-
nection with Its other federally sponsored
activities, In the following order of priority:
(a) Activities, In the following order of
priori ty :
(b) Activities sponsored by other Federal
agencies,
(2) Shared use,-Durlng the time that
nonexempt nonexpendable persOnal proper-
ty Is held for use on the project or program
for which It was acquired, the recipient
shall make It available for use on other proj-
ects or programs l! such other use will not
Interfere with the work on the project or
program for which the property was origi-
nally aoqulred, First preference for such
other use shall be given to other projects or
programs sponsored by .tbe Federal agency
that nnanced the property; second prefer-
ence shall be given to projects or programs
sponsored by other Federal agencies, It the
property Is owned by the Federal Govern-
ment, use on other activities not sponsored
by the Federal Government shall be per-
missible If authorized by tbe Feden,1 agency,
User charges should be considered it appro-
priate,
c. Dupontion oj other nonexpendable
property,-When the recipient no longer
needs the property as provided In 6b above,
the property may be used [or other activi-
ties In accordance with the following stand-
ards:
(I) None:rpendable property with a unit
acquisition cost oj less than $1,OOO,-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) None:rpcndable personal property with
a unit acquisition cost oj $1,000 or more,-
The recipient may retain the property for
other USC8 provided that compensation Is
made to the original Federal sponsoring
agency or Its successor, The amount of com-
pensation shall be computed by applying
the percent"'ge of Federnl pOU'tlctpRtlon In
the cost of the original project or program to
the current fair lllArket value of the property,
If the recipient has no need for the property
and the property has further use value, the
recipient shall request disposition Instruc-
tions [rom the orlgtnal sponsoring agency,
I
Office of Management and Budget Circular A-110 (7/30/76)
The Federal sponsoring agency shall deter-
mine whether the property can be used to
meet the agency', requirements, If no re-
quirement exists within that agency, the
avallablllty of the property shall be report-
ed to the General Services Administration
by the Federal agenc.y to determine whether a
requirement for the property exists In other
Federal I\gencles, The Federal sponsoring
agency shl\lI Issue Instructions to the recipi-
ent no later than 120 days after the recipi-
ent's request and the following procedures
shall govern:
(a) If so Instructed or If disposition In-
structions are not Issued within 120 calen-
dar days after the reclplent.s request, the
recipient shall sell the property I\nd reim-
burse the Federl\l sponsoring agency an
amount computed by applying to the sales
proceeds the percentl\ge of Federal partici-
pation In the cost of the original project or
program, However, the recipient shall be
permitted to deduct and retain from the Fed-
eral share UOO or ten percent of the pro-
ceeds, whichever Is greater, for the recipient's
selling and handling expenses,
(b) If the recipient I.s Instructed to ship
the property elsewhere, the recipient shall
be reimbursed by the benefiting Federal
agency with an I\mount which Is computed
by applying the percentage of the reclplent.s
participation In the cost of the original grant
project or program to the current fair market
value of the property, plus any reasonable
shipping or Interim storage costs Incured,
(c) If the recipient Is Instructed to other-
wise dispose of the property, the recipient
shall be reimbursed by the Federal sponsor-
Ing agency for Buch costs Incurred In Its
d1.sposltlon,
d, Property management 3tandard3 lor
nonexpendable property,-The (eclplent's
property management standards for nonex-
pendable personal property shall Include the
following procedural requirements:
(I) Property records shall be maintained
accurately and shall Include:
(a) A description of the property,
(b) Manufacturer's serial number, model
number, Federal stock number, national
stock number, or other Identification num-
ber,
(c) Source of the property, Including
grant or other agreement number,
(d) Whether title vests In the recipient or
the Federal Govllnlment.
'(e) Acquisition date (or date received, If
the property W8.ll furnished by the Federal
Government) and cost,
(f) Percentage (at the end of the budget
y....r) of Federal participation In the cost of
the project or program for which the prop-
erty was acquired, (Not applicable to prop-
erty furnished by \he Federal Government,)
(g) Location, use and condition of the
property and the date the Information was
reported,
(h) Unit acqul<lon cost.
(I) Ultimate disposition data, Including
date of disposal and sales price or the method
used to determine current fair market value
where a recipient compensates the Feder..1
aponsorlng agency for Its share
(2) Property owned by the Fedcral Gov-
ernment muat be marked to Indicate Fed-
eral ownership,
(3) A physical Inventory of property shall
be taken and the results reconclled with the
property records ..t lel.8t once every two
years. Any dll'lerencu between quantltl..s de-
termined by the physical Inspection and
thqse shown In the accounting records shall
be Investigated to determine the causes of
the dll'lerence. The recipient shall, In connec-
tion with the Inventory, verify the existence,
current utlllzatlon, and continued need for
tho property,
(4) ^. control system shall be In eITect to
Inlure ad&quate safeguards to prevent loss,
damagc, or theft of the property, Any 10",
damage. or theft of nonexpendable property
shall be Investigated and fully documented;
If the property was owned by the Federal
Government, the recipient shall promptly nO-
tlfy the Federal sponsoring agency,
(5) Adequately m..lntenance 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 then '16 a
residual Inventory of such property exceeding
$1,000 In total aggregl\te f..lr 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 for use on non federally spon-
sored activities, or sell It, but must In eltlTer
case, compensate the Federal Governm..nt
for 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 Government,
such fact shall be promptly and fully report-
ed to the Federal sponsoring agency, Unless
there Is a prior "greement 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 BOught, The Federal sponsoring agency
wll1 also determine how the rights In the In-
vention or discovery-Including rights under
any patent l.o;sued 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 Executive Departments and
Agencies, August 23, 1971, and statement of
Government Patent Policy as printed In 36
F,R. 16889),
b. Copyrigh.ts,-Except as ()therwln pro-
vided In the terms and conditions of the
agreement, the author or the recipient organ-
Ization Is free to copyright any books, pub-
llcatlol16, or other copyrightable materl&1s
developed In the course of or under a Fed-
eral agreement, but the Federal sponsoring
agency shall reserve a royalty-free, nonex-
clusive and Irrevocable right to reproduce,
publish, or otherwise use, and to ..uthorlae
others to use, the work for Government pur-
poses,
ATTACHMJ:NT O.----CncuLI.a No, A-110
P"OCURSMENT STANDARDS
L This attachment provides standards for
use by recipients In establlehlni procedures
for the procurement of luppll.s, equipment,
construction and other services with Federal
funds, These standards are furnished to en-
sure that luch materials and services are ob-
t..lned In an elIectlve manner and In com-
pliance with the provisions of applicable Fed-
er..l law and executive orders, No addltlon..1
procurement standards or requirements shall
be Impond by the Federal sponsorIng agen-
cies upon recipients unless speclncally re-
quired by Federal statute or executive orders,
2, The standards contained In this attach-
ment do not relleve the recipient of the con-
tractu"l responsibilities arising under Its
contracts. The recipient Is the responslble ..u-
thorlty, without recourse to the Federal spon-
soring agency regarding the settlement and
satisfaction of all contractual and admlnls-
I
A-110:21
tratlve Issues arhlng out of procurements
entered Into, In lupport of a grant or other
agreement, This Includes disputes, clalm...
protests or: award, .ouree evaluation or other
matters of a contractual nature, Matters con-
cerning violation of law are to be referred to
such local, State or Federal authority.... may
have proper }urledleUon,
3, Recipients may \We \helr own procure-
ment policies and proced\lrSl, However, all re-
cipients shall adhere to the standards set
forth In p"ragrl\phl :I ..nd 4.
a, The recipient shall maintain a code or
standard.. of conduct that shall govern the
performance of 1\5 omcera. employCils or
agents engaged In the awarding Rnd admin-
Istration of Clont.racts using Federal funds.
No employee. omcer or agent shall partiCipate
In the selection, "ward or administration of
a contract In which Federal funds are used,
where, \0 his knowledge, he or his Immediate
family, partnerl, or organlz"tlon In which he
or his Immediate family or partner has a
nnanflal Interest or with whom he Is nego-
tiating or haa any ..rrangement concerning
pro.pectlve employment. The recipients' of-
ficers, employees or agents shall nel ther sollc-
It nor aoooflt gratultt.el, favors or anything
of monetary value from contrflctors or poten-
tial contractors, ~uch standards shall provide
for disciplinary actions to be applled for vio-
lations oC such standards by the recipients'
omcers, employees or agents,
b, All procurement kansactlorul shaH be
conducted In a mannH t.o provide, to the
.maxlmum extent practical, open and free
competition. The recipient should be alert
to organizationa.l confttcts of Interest or non-
oompetltlve 'Practices aID<>ng oontracton
that may restrl<>t or eUminate competltlon
or otlberwtM restra.lll trllde, In order to en-
sure objective contn.ctor performance and
ellmln"te unCs.1r cOl'npetltlve advantage, con-
tro.cbors that develop or draft spoclficatJoI\5,
requke.ments, lrtatements of work, Invlta-
tlol1J5 for bids and/or requC6t.s for propoeals
should be excluded from eom:petlng for such
procurements, Awarda .tIall be made to the
bidder /offeror whose bid/olT.... is roopons.lve
to the 8OIIcltatJIon and Ie ID06t advantageous
to the reelpknt, prIce and other facbors con-
sldeN>d, 801lcltatl.oal ahe.ll clearly set forth
all requlrements that the bidder/offeror must
fulfill In order for h\l!l l*l/oITer to be ere.lu-
ated by bhe reoclplent. Any ..nd all bld3/offers
may be rejected when it Is In the reolp1ent's
Interelt to do 80.
c, All reclp~nts lIlhall est&bllsh pT'OCUl'e-
ment procedurel t.h&t provldV for, at a mln-
Imum, the followIng p!'OCltduroJ"requlrenumts,
(1) Propo&ed procurement actlOJlS shall
follow a prooedure to """ure the avoidance
of purclla.elng unne.ceesary or duplicative
Items. Where approprie.te, an analyelis shall
be Jl'l&CI.e of Ie...... and purch&M, alteornalJvllS
bo determine whloch would be the moet
eoononUOI.I, practlc1t.l prOC'UNlment,
(2) Sollclbatlons fO<' goode and services
shall be 'based upon .. clear and accurate
dNCrlptlon of bile \ect\nlcal r&qulrementll
fcl' \he mat<<I..I, prodv<:t or :!I8'CYlce to be
procured, Such a d........lpli4.on ma.l1 not. In
com.petltlve pro<luremen\I, contain reatures
whICh unduly res\rlct competition, "Brand
n..me or equal" descrlptlolU Jn4Y be und
Roe" meanl to define the performanoe or
other nU.nt requlrementa of a procurement,
and when 10 u8e(\ the specUlc features of the
named bre.nd W'h~ must be met by bidders/
oITer:Jrs shaJ.l be clearly apec.lned,
(3) Positive efforts ~h..lI be made by the
recipients to utilize smflll buslneM and mi-
nority-owned business sources of supolles
and s.nloel, Such eITocta should a.llow theM
sources the maximUM f.....lble opportunity
to compete for contracta utilizing Feders.1
funde,
(4) The type of proeurlnp; lJUtrument.
used, e.g., Ilxed price oon tracta , ooet relm-
I
Office of Management and Budget Circular A-110 (7/30/76)
bursa<ble rontracts, purchase orders, Incen-
tIve contracts, shall be determined by the
recipient but must be appropriate for the
partloular procurement and for promoting
the best Interest of the program Involved,
The "cost-plt1.3-a-percentage-of-co.st" meth-
od of contracting shall not be used,
(5) Contract.s sho.l be mn.de only with re-
sponsible contractors who po65C56 the po-
tentlonal ability to perform succ.e;;sfully
under the terms "nd conditions of a pro-
posed procurement. Consideration shall be
given to such matters as contrnctor Integrity.
reoord of past performAnce, financial and
technlOll.I resources or accC531blllty to other
necessary resources.
(6) All proposed sole source con tract., or
where only one bid or proposal Is received
In whiah the aggregate ex.pendlture Is ex-
pected to exceed ~,OOO shall be subject to
prior approval at the dlscretlnn of the Fed-
eral sponsoring agency,
(7) Some form of price or coot analy'Sls
should be made In connection with every
procurement action, Price analysis ma.y be
accomplished In varIous ways, IncludIng the
comparison of price quotations submitted.
mnrket prices and similar Indicia, together
with discounts, CoGt anal)'6ls Is the review
and evaluation of each elCJ11cnt of cost to
detertnlne rensona.blen~. alloca.b\1lty and
allowa.bUlty,
(8) Procurement records a.nd files for pur-
c.ha.ses In eJCCe5S of $10,000 &hall Include the
fOllov.llng :
(a) BasIs for contrnctor selection;
(b) Justification for lack of competitIon
when cotnipetltlve bIds or olIers are not
obtaIned;
(c) Basis for award cost or price,
(9) A system for contTact administration
shall be malntalned to ensure contractor
conformance with terms, conditIons and
speclflca tlons of the con tract. and to ensure
adequau; and timely followup of all pur-
chases.
4. The recLplent shall Include, In addItion
to provIsions to define a sound and complete
. agreement, the following prov1slons In all
contracts, These provIsions shall also be ap:
piled to subcontracts,
a, Contra.cts In excess of $10,000 shall con-
tain contmctual prov1slons or condltJons
that wlll allow for a.d1n1nlstratlve, contrac-
tua.l or legal remedIes In Instances In which
contra.ctors vlol..te or breach contract tenns
and provide for such rem.edlal actions ..;
JJlilI.y be appropriate,
b. All contracts in excess of $10.000 shall
conmln sult...ble provisions for termina.tlon
b, the rectplent IncludIng the ma.nner by
whIch termInation w\1l be elIected and the
basis for settlement, In addition. such con-
tra.cts shall describe conditions under whIch
the oontract may be terminated for default
as well as C<Jndlllon, where the contro..ct may
be tepmInated beo,use of olrcumstances be-
yond the C<Jntrol 01 tile contractor.
c. In all contracts for construction or fa-
cility Improvement awarded for more than
$100,000. recipients shall ob6erve the bond-
Ing requirements p<'oVlded In AttacJunent B
to this elrcular,
d, All contracts awarded by reclplent.<< and
their contractors or subgrnntees having ..
value of more th..n $10,000, shall contain ..
provision requIring compll.nnce with Execu-
tive Order 11246, entitled "Equal Employ-
ment OpportunIty," as amended by Executive
Order 11375, and as supplemented In Depart-
ment of Labor regulations (oj.[ CFR, Part 60),
e, All contracts and subgrants In excess of
$2,000 for construction or repair awarded by
recIpIents and subreclplent.s 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 each contractor or subgrantee
shall bc prohIbIted from Inducing. by nny
means, any person employed In the construc-
tlon, completion, or repair of public work, to
give up any part of the compensation to
which he Is otherwise entitled, The recIpIent
shall report all suspected or reported viola-
tions to the Federal sponsorIng ..genc"
f, When required by the Federal program
legislation, ..II constructlon contracts
awarded by the recipients and subreclplents
of more th..n $2,000 sh..lllnclude .. provision
for compliance with the Davis-Bacon Act (40
U,S,C, 276.. to a-7) and as supplemeruted by
Department of L..bor regul..tlons (29 CFR,
Part 5), Under this Act contractors shall be
required to pay wages to I..borers and me-
chanics at a rate not less than the minimum
wages specified In a wage determlnatlon made
by ,the Secretary of Labor, In addltlon, con-
tractors shall be requIred to pay wages not
less than once a week.. TIle recipient shall
place a copy of the current prevnlllng wage
determInation Issued by the Department of
Labor In each sollcltatlon and the award
of a contract shaH be condl.tloned upon the
acceptance of the wage determination, The
recipient shall report aH suspected or re-
ported violatIons to the Federal sponsoring
agency,
g, Where applicable, a:1 contracts awarded
by recipients In excess of $2,000 for construc-
tion contract., and In exceES of $2.500 for
other contracts that Involve the employment
of mechanics or laborers. shall Include a pro-
vision for compliance wlt.h sections 103 and
107 of the Contract Work Hours and Safety
Standards Act (40 U,S,C. 327-330) as sup-
plemented by Departmerut of Labor regula-
I
A-110:22
tlons (29 CFR, Part 5), Under section 103
of the Act, each cont.ractor shall be re-
quired t.o compute tile wages of every me-
chanic and laborer on the basis of -a standnrd
work day of e hours and a st.andnrd work
week of 40 hours, Work In excess of the
st.andard workday or workweck.ls pennlsslble
provided t.h..t the worker Is compensatcd at a
ra te of not less than 1'/2 times the basic
rat.e of pay for aH hours worked I n excess
o[ 8 hours In any calendar dnyor 40 hours
In the workweek, Sectlon 107 of the Act Is
applicable to construcllon work and provIdes
that no laborer Dr mechanic shall be rcquired
t.o work In surroundings or under workIng
condltlons whIch arc unsanItary. hazardous
or dangerous to his health and salety as dc-
termlned under construct.lon salety and
heal th standards promulgated by thc Secre-
t.ary of Labor. These rcquirements do "ot
apply to the purchases of sllppllcs or nlnte-
rials or artlcles ordinarily available on the
open market, or contract.<; for transport.atlon
or transml:;slon of Intrlllgence,
h. Contracts or ng'reements. the principal
purposc of which L, to create, develop or Im-
prove products. processes or methods; or for
exploratlon Into fields that. dlrcctly concern
public health. safety or welfare; or contmcts
In t.he field of selence or technology in whIch
there has been little significant experience
out.slde of work funded by Federnl assist-
ance, shall contain a not.lce to the eflect ,that
matters regarding rights to Inventions and
materials generated under the contract or
agreement are subject to the regulations Is-
sued by the Federal sponsoring agency and
the recipient, The contractor shaH be ad-
vised as to the source of addl tlonal Informa-
tion regarding these matters,
L All negotlated contraots (except those
of :UO.OOO or less) awarded b~' recipients
shall Include a provIsion to the elIect that
the recipIent, the Federal sponsoring agency,
the Comptroller <kneral of the United States,
or nny of their duly authorized reoresent..-
tlves, sh..1I have access to ..ny books. docu-
ments. papers and records of the contractor
which are directly pertinent to a specific pro-
gram for the purpose of making audits.
examlnatlons, eXCilrpts and transcriptions,
J, Contrncts and subgTan.ts of amounts In
excess of $100,000 sh..1I eont.aln a provision
t.hat requires the recipient to agree to com-
ply wlt.h all applicable standards. orders or
regulations Issued pursuant to the Clear Air
Act of 1970 (42 U,S,C, 1857 et scq,) and the
Federal W..ter PollutIon Control Act (33
U,S,C, 1251 et seq,) as amended, Violations
shaH be reported to the Fedcral s~nsorlng
agency and the Regional Omce of the En-
vironmental Protection Agency. -
I FR Ooc,76-21904 FIled 7-29-76; 8 :45 am]
I
APPENDIX H
OMB
Circular A-I22
I
I
Office of Management and Budget Circular A-122 (6/27/80)
OFf'tCE OF MANAGEMENT AND
BUDGET
Ctroular A~122, "Cost Principles for
Nonprofit Organizations"
AGENCY: Office of Management and
Budget.
ACTION: Final Policy.
June 27, 1900
To The Heads of Executive
Departmer:.ts and Establishments
Subject: Cost principles for nonprofit
organiza tions:
1. Purpose. This Circular establi:;hes
principles for determining costs of
grants, contra::ts and other agreements
with nonprofit organizations, It docs nol
apply to colleges ap.d universities which
<<re covered by Circular A-2~ Stote.
locol, and fe'dernlly recognized Indian
tribal governments which are covered
by Circular 74--4; or hospitals, The
principles are designed to provide that
the Federal Government bear its fair
share of costs except where restricted or
prohibited by law. The principles do nol
allempt to prescribe~the extent of cost
sharing or matching on'grant5. cuntracts,
or other agreemel~ts. However, such cosl
sharing or matching shall not be
accomplished through arbitrary
limitations on individual cost elements
by Federal agencies, Provision for profit
or other increment above cost is outside
the scope of this Circular.
2. Supersession. This Circular
supersedes cost principlds issued by
individual agencies for non'profit
organization.
3. Applicability, a. These principles
shall be used by aU Federal agencies in
determining the .costs of work performed
by nonprofit organizations under grants.
cooperative agreements. cost
reimbursement contracts. and other
contracts in which costs are used in
pricing. administration, or s~ttlp.ment.
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 cosl reimbursement subawards
(subgrants, subcontracts, etc.) are
subject to those Federal cost principles
applicable to the particular organization
concerned, Thus, if a stibaward is to II.
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 uni versity, Circular A-21
"hall apply; if a subaward is to a State,
local..or fedeI1aHyreod~i:md InGtAnl
tribal government. Circular 74-'-4 shiil1
apply.
4, Definitions. a, "Nonprofit
organization" means any corporation,
trust. Imsocia tion, cooperative. or other
organization whit:h (1) is operated
primarily' for scfentific. educational.
service. charitable, or similar purposes
in the public interest; (2) 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) hospital,,; (Hi) 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 Circulor. Generally this
permission will be in writing, Where an
item of cost requiring prior approval is
spedfied in the budget of an ,award.
approval of the budget constitutes
approval cfthat cosL
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 listing of these
organizations is coo.uined.in
Attachment C. Other organizaoons may
be added from time to time.
6. Responsibilities, Ageo.ciea
respons'ible for administering programs
that involve awards to nonprofit
organizations shall implement the
provisions of this Circular. Upon
request. implementing instruction shall
be furnished to the Office of
Management and Budget. Agencies shall
designate a liaison official to serve as
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. Attnchments. The principles and
related policy guides are set forth in the
following Attachments:
Attachment A-C€neral Principles
Attachment B-Selected Items of Cost
Attachment G-Nonprofit
Organizations Not Subject !p This
Circular
I
A-122:1
8. Requests forexceptioJls. 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 pennitted only in
highly unusual circumstances.
9. Effective Date. The I1rovisions 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 ofindividual pro-visiQIl8
is also permitted by mutual agreement
between 1ll1' organiza tion 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, W503.
telephone (202) 395-4773. -
James 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. Applicable credits
o. Advance understandings
B. Direct Costs
C. Indirect Costs
'\
D, Allocation of Indirect Costs and
Determination of Indirect Cosl Rales
1. General
2. Simplified allocation method
3, Mulliple 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-122]
Attachment A
General Principles
A. Basic Considerations.
1. Composition of total costs. The total costsof an award is the sum of the allowable
direct and allocable indirect costs Jess any
applicable credits.
2, Factors affecting allowability of costs.
I
Office of Management and Budget Circular A-122 (6/27/80)
To be allowable under an award. costs must
meet the following general criteria: '
a, Be reasonableJor the performance of the
award and be allocable therelo under these
principles,
b. Conform to any limitations or exclusions
set forth in these principles or in the award
as to types or amotiiIt of castilems.
c. Be consistelJt wjth policies and
procedures that apply uniformly to both
federally financed and other activities of the
organization.
d, Be accorded consistent treatment.
e, Be determined in accotdance wtth
generally accepted accouniing principles.
f. Not be included as a cost or used to meet
cost sharing or matching rllquirements .0T any
other federally finartced . program in either the
current or II prior period.
g, Be adequately documenred.
3. Reasonable cosls, A cost is reasontible
if. in its nattire or amount. iC:does not exceed
that which would be Incur~d by 8 prudent
person under the circumstlinCes pFl!vailing at
the time the decision was made to incur the
costs. The question of the reasonableneslhof
specific costs musl be scrutinized with
particular care in connectign with
organiza tions or separa te divisions thereof
which receive the preponderance.o(their
support from awards made' by Fede'rnl
agenCies. In determining the reasonableness
of a given cost, consideration shall be given
to:
a. Whether the cost is of a type generally
recognized as ordinary and neceslfary 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 indivldtfulsconcerned acted
with prudence in the circumstances.
considering their rasponsibilities 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:mization
which may 'unjustifiably increase the award
costs,
4. Allocable costs.
a. A cost is allocable to a particular cost
objective. jluj:h 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 ti)e
same purpose in like Circumstances and if it:
(1) Is incurred specifically for the award.
(2) Benefits both the award and other work
aOld can be distributed in reasoDable
proportion to the benefits received,
(3) Is necessary to the overall operation of
the organization. although a direct
relationship to any particular cost objectiva
cannot be shown.
b. Any cost allocable to a particular award
or other cost objective under these principles
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 credits.
a, The term applicable credits refers 10
those receipts, or reduction of expendi tures
which operate to offsct or reduce expnnscs
items that lire allocable to awards as direct
or indirect cosls. Typical examples of such
transactions are: purchase discounts. rebates
or allowances. recoveries or indemnities on
losses. insurance refunds. and adjustments of
overpayments or erroneous charges. To the
extent thai such credits accruing or received
by the organization relate to allowable cost
they shall be credited to the Government
either as a Cosl reduction or caflh refund as.
appropriate.
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
determing the rnles or amounts to be
organization in determining the rates or
arnaounts tobe charged to Federal awards
for services rendered whenever the facilitics
or other resources used in providing such
services have been financed directly. in
whole or in part. by Federal Cunds;
a(c) For rules covering program income
(i.e.. gross income earned frolTl federally
supported activities) see Attachment D of
OMB Circular A-ll0.
6, Advance and understandings. Under any
given'award the reaeonablenC'ss and
allocability of cerlain items of costs may be
difficult to determine. This particularly true in
connecti~n with orgizatiol1ll that receive a
preponderance of their sUPPOl'tfrom Federlll
agencies, In order to Bvoid subsequent
disallowance'or disPJJle based 011
ul1reasonablenells Or nl;lIlall~ability. It is
often desirable to seek a wriliim agreement
with the cognizant or awarding 'agency iil
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 with a particular final
cost objective: Le.. a particular award.
project. service, or other direct activity of an
organization, However. a cost may not be
assigned to an award as a direct cost if any
other cost incurred for the same purpose. in
like circumstance, has been allocated to an
award as an indirect cost. Cost identified
specifically with awards are direct cost of the
awards and are to be lIssigned directly
thereto. Cost identified specificaliy with other
final cost objectives of the organization are
direct costs of those cost objectlves and are
notto be assigned to other awards directly or
indirectly,
2, Any direct cost of a minoramounl may
be treated as an indirect cost of or reasons nf
practicality where the aGcotlnt treatment for
such cost is consistcntly applied to all final
cost objectives.
3. The cost of certain activities are not
allowable as charges to Federal awards (see.
Cor example. fund raising costs in paragraph
I
A-122:2
21 of Attachment B), However, even though
these costs are unallowable for purposes of
computing charges 10 Federal awards, they
nonetheless must be treated as direct cost for
purpose. of determining lndirect cost ra tes
and be allocated their share of the
organization's indirect costs if they represent
activities which (1) include the salaries of
personnel. (2) occupy splice. and (3) benefit
from the orgariization's indirect cost.s.
4. The costs of activiliel performed
primarily as a service to members, clients, or
the general public when significant and
necessary to the organization's mission musl
be treated as direct costs when or not
allowable and be allocated an equitable
share of indirect costs. Some examples of
these type I of activilies include:
a. Maintenance Qf membership rolls,
subs'criptions. publications, and related
functions.
b. Providing services and information to
members. legislative or administrative
bodies. or the public,
c. Promotion. lobbying. and olher forms of
public relations.
d. Meetings and conferences except those
held to conduct the general administration of
the organization,
3. Maintenacne. protection. and investment
uf special funds not used in operation 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,
C. Indirect Cost.
1. Indirect costs are those that have been
incarred for common or joint objectives and
cannot be readily, identified wilh a particular
final cost objective. Direct cost of minor
amounts may be treated as indirect costs
under the conditions described in paragraph
8.2. above. After direct costs have been
determined and assigned directly to awards
or other work as appropriate. indirect costs
are those remaining to be allocated to
benefiting cost objectives. A cost ml\Y not be
allocated to an award as an indirect cost if
Emy other cost incurmdfor the .iama purpose.
in Iik~ circunulances. ,has been as;ig~ed to
an llward as a direcl cost. 1
2, Because of the diverse characteristics
and accounting practices of nonprofit
organizations. it is not possible to specify the
type.s of cost which may be classified as
indirect 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 operating and maintaining
facilities, and general administration and
g~'neral expenses. su'ch as the salaries and
expenses of executive officers. personnel
administration. and accounting,
CD, Allocation of lndirect Cost and
Determination of Indirect Cost Rutos.
1. Ceneral,
a, Where a nonprofit organization has only
one major function, or w~lele all its major
functions benefit from its indirect costs to
approximately the same degree. the
allocation of indirect costs and the
I
Office of Management and Budget Circular A-122 (6/27/80)
computation of lInindirect GOstntellUlf be
accomplished through simplified alloc8tion,
procedures asdoscribed in paralJfapb 2
below.
b. Where an organization hal several major
functions which benefit from its indirect costs
in varying degrees. alloca tion of indirect
costs may require the accumulation of luch
costs into separate cost groupings which then
are allocated individually to benefiting
functions by meaDS of a base which best
measures the rf!lative degree of benefit. The
indirect costs allocated 10 each function are
then distributed to individual 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 service. it
renders to the public. its clients, and its
members; and the amollnl of dfortlt uevotes
to such activities DS fund rnlsing. public
Information and membership activities,
d, Specific method. for allocating indirect
costs and computing indirect cost rates along
with the conditions under which each method
should be used are described in paragraphs 2
through 5 below.
e. The base period for the allocation of
indiree,t 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'. fiscal y'oar. but in any
evnt. shall be so selected a.. to avoid
Inequities in the allocation of the costs,
2. Simplified allocation method. ,
a, Where an organization's major functions
benefit from its indirect COlltS to
approximately the samE' degre. the allocation
of indirect costs may be accomplished by (i)
separating the organization's total costs for
the base period as ellher direct or indirect.
itnd (ii] dividing the total allowable indirect
costs (net of applic:able credits) by an
equitable distribution base. The result of this
proccss is an indirect cost rate which is used
to distribute indirect costs to individual
a wards. The ra te 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
indi vidual 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 activities 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 lill major
subcontracts or s:Jbgrants), direct salaries
and wages. or other base which results in an
equitable distribution. The distribution base
shall generally exclude participant suport
costs as defined in paragraph 2g of
Attachment B.
d. E>;cept where a ~i'edal ratc(sl is
required in accordance with paragraph 0,5
belBw ,the ,indi.reclD)8t rale'~kJped Bder
the above principles.iaaRPlicable.to uU
award. ut,the OI'llani:uUioD..n a special
rate(s) is requil'ed.appropriate modifications
shall be made in order to develop the special
rate(s).
3. Multiple alloeolion base method
a. Where an organization's indirect costs
benefit its majorJunctions in varying degrees,
such costs shall be accumulated into separate
cost groupings. Each grouping shall then be
allocated individually to benefiUng functiona
by means of a base which best measures the
relative benefits.
b. The groupings shall be established so as
to permit the allocation of aach grouping on
the basis of benefits provided to the major
functions, Each groupiD3 should constitute a
pool of expenses that are of like character-in
terms of the functions they benefit and in
terms of the allocution bURe whluh Llllat
measurs the relative benefitsprovidd to each
function. The number of separate groupings
should be held within practical limits, 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 cosl grouping
directly to the function benefited. the
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 Government and 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 {i) it can readily ba
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 D.5. below. the separate groupings
of indlract costs allocated to each major
function shaJl be agregated and treated as a
common pool for that function. The cosls 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 llems such
uS major subcontracts and subgrants). direct
salaries 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
ra te should be developed fir each s~para te
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
witbthatpool
4. o;rer;t allocation method.
8. Some nonprofit organizations. treat all
costs as direct cos.ls 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 (iii) 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 appropriate to the
particular cost being prora ted.
b. This method is acceptable provided each
joint c,o,st is prorated using a base which
accllrately mensures the benefits provided to
ench ownnJ or other ncllvliy. TIll! unReR 1ll1I"!
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 Welfare
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 general administration and
general expenses, In all other respects. the
organization's indirect cost ratess shal be
computed in the same manner as that
described in paragraph 0.2 aLove.
5: Special indirect cast rates. In some
instances. a single indirect cost rale 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 in2lude the
physical location of the work, the Jevp.I of
Administrative support rE'quired, 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 separate
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 D.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.
I
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" menns the Federal
agency responsible for negotia ting and
approving indirect cost rates for a nonprofit
organization on behalf of all Federal
agencies,
b. "Predetermined rote" 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" means 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 role 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 rale applicable to a
specified period which is used for funding,
interim reimbursement, and reporting indirect
chsts 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 capitalized
projects.
2, Negotiation and approval of rales,
a. Unless different arrange'ments are
agreed to by the agencies concerned, the
Federal agency with the largest dollar value
of awards with an organization will be
designated as the cognizant agency for the
negotiation and approval of indirect cost
rates and, where necessary, other rates such
as fringe benefit and compuler charge-out
rales. Once an agency is assigned cognizance
for a particular nonprofit organization, 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 negotianon
process, but after a rate 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 necessitate special
indirect cost rates in accordance with
paragraph D.5 above, it will, prior to the time
the rates are negotiated, 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 be
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; (il) 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 cast rate between the cognizant
agency and the nonprofit organization, the
dispute shall be resolved in accordance with
the appeals procedures of the cognizant
agency.
i. To the extent that problems ure
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-122]
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
II, Contributions
9. Depreciation and use allowances
10. Donations
11. Employee morale, health and 'welfare
costs and credits
12. Entertainment costs
13. Equipment and other capital expenditures
14. Fines and penalties .
15. Fringe benefit.
16. Idle facilities and idle capacity
17. Independent research and development
(resen'ed)
18, Insurance and indemnification
19, Interest. fund-raising, and investment
managemf:nt costs
ZOo Labor relations costs
I
A-122:4
21. Losses on other awards
22. Maintenance and repair costs
23. Materials lV1d supplies
24, Meetings. conferences
2.5. Mem!Jerships, subscriptions, and
professional activity costs
26. Organization costs
27. Overtime. extra-pal' shift and .multishitl
premiums
28. Page charges in professional journals
29, Participant support costs
30, Patent costs
31. Pension plans
32. Plant security costs
. 33. Preaward costs
34. Professional service costs
35. Profits and losses on disposition of
depreciable properly or other capital
assets
:lB, Public itHormation service costs
37. Publication and printing costs
:l8. Rearrangement and alteration costs
39. Reconversion costs
40. Recruiting costs
41. Relocation costs
42, Renlol costs
43, Royalties and other costs for lI!;e of
patents and copyrights
44. Severance pay
45, Specialized service facilities
46. Taxes
47. Tennination costs
48. Training and educotion costs
49. Transportation costs
50. Travel costs
[Circular No. A-l2Z]
Allachment B
Selected Items of Cost
Paragraphs 1 through 50 provide principles
to be applied in establishing the allowubility
of certain items of cost. These principles
apply whether a cost is treated as direct or
indirect. Failure to mention a particular item
of cost is not intended to imply that it is
unallowable: rather determination !IS to
allowability in each case should be based on
the treatment or principles provided for
similar or rela ted items of cost.
1. Advertising costs. ...
B. Advertising costs mean the costs of, .
media services and associated costs. Media
advertising includes magazines, newspapJrs,
radio and television programs, direct maiL
exhibits, and the like.
b, The only advertising costs allowable are
those which are solely for (i) lherecrullment
of personnel when considered in conjunction
with all other recruitment costs, as set forth
in poragraph 40;.(ii) the procurement of goods
and services; (iii) the disposal of surplus
materials acquired in the perfonnance of the
award except when organizations Bre
reimbursed for disposals at II predetermined
amount in accordance wilh Attachment N of
OMll Circular A-llO; or (iv) specific
requirements of the award.
2. Bod debts. Bad'()ebts, including losses
(whether actual or estimated) arising from
uncollectible Bcconnts and other claims,
related collection costs, and relatod legal
cosls, 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
finllncialloss to itself or others by reason of
the ael or default of the organization, They
urise a 150 in instances where the organiza lion
n~quires similar assuranoe. Included are such
bonds as bid, performance, payment,
advance payment, InfringemenL and fidelity
bonds,
b. Costs of bonding required pursuant 10
the terms of the award are allowahle.
c. Costs of bonding requlmd by the
organization in the general conduct of ill
operations are allowable to the extent that
such bonding Is In accordance with sound
business practice and the rates and premiums
are reasonable under the circumstances.
5. Communication costH. Costs Incurred for
telephone services, local and long distance
telephone colis, telegroms, radiograms,
poslage /lnd the hk:e, are allowable.
6. Compensation for personal services.
a. Definition. Compensation for pereonal
services includes IIll compensation paid
currently or accrued by the organil:ation for
services of employees rer.dered during the
period of the award. (except as otherwise
provided in paragraph g. below). II includes,
but is notlimiled to, salaries, wages,
director's and executive comrnillee member's
fees, incentive awards, fringe benefits,
pension plan .costs, allowances for off-site
pay, incentive pay, location allowances,
hardship pay, and cost of living differentials.
b. AlIowability. Except os otherwise
specifically provided in this paragraph the
costs of such compensatianare allowable to
the extent that:
(1) Total compensation to,individual
employees is reasonable for the services
rendered and conforms to the established
policy of the organization consistently
applied to both Government and non-
Covernment activities: and
(2) Charges to awards whether treated 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 other than those
sponsored. by the Government, compensation
for employees on Government-sponsored
work will be considered reasonable to the
ex lent 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. are
not found in the organization's other
activities, compensation for employees on
Government-sponsored work will be
considered reasonable ,to the extent that it 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
allowability. Certain conditions require
special consideration and possible limitations
in determining costs under Federal awards
where amounts or types of compensation
appear unreasonable. Among such conditions
are lhe following:
(1) Compensution to members of nonprofit
organizc:tions. trustees, directors. associates,
officers. or the immediote families thereof.
Determination should be made thet such
compensation is reO-sl)nable for the actual
personal services rendered rather than a
dislribution of earnings in excess of cos\$.
(2) Any change in an organization's
compensation policy resulting in a
substantial increase in the organization's
level of compensation, particularly when it
was concurrent with an increase in the ratio
of Government awards to other activities of
the organization or any change in Ihe
treatment of ailowlioility of specific types of
compensation due to changes In Government
policy,
e, Unallowable casts. Costs which ore
unallowable under other paragraphs of this
AlIachment shall not be allowable under this
paragraph solely on the basis that 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, alld the like. are allowable provided
such costs are absorbed by all organization
activities in proportion to the relative amount
of time or effort actually de\'oted to each.
(2) Fringe benefits In the form 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 wrillen
organization policies. Such benefits whether
treated as indirect costs or as direct costs.
shall be distributed to particular awards and
other activities in a manner consistent with
the pallem of benefits accruing to the
individuals or group of employees whose
salaries and wages a~e chargeable to such
awards and other activities.
(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 tho
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 value of the liability.
(b) Where an organization follows a
consistent polcy of expensing actual
payments to, or.,on behalf ot employees or
Ionner employees for unemployment
:Compensation or workmen's compansation,
such.payments are allowable in the year of
'Payment with the prior approval of the
awarding agency provided they are allocated
tO'al1 acUvities of the organization.
(4) Costs of insurance on the lives of
trustE'es, officers. or other employees holding
positions of similar responsibility are
allowable only to the extent that the
insurance represents additianal
compensation. The costs of such insurance
when the organization is named as,
I
A-122:5
beneficiary are unallowable,
g. Pension plan costs.
(1) Costs of the organization's pension plan
which are incurred in accordance with 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
discriminatory; .
(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.8
issued by the American Instilute of Certified
Public Accountants; and
(d) The costs assigned to a given fiscal year
ere funded for all plan participants within six
months aiter the end of that year. However,
incre.lIses to normal and past service pension
costs caused by a delay in funding the
actuarial liability 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 lhe Employee
Retirementlncome Security Act of 1974 (Pub.
L. 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 Retirementlncome
Security Act are unallowable,
h. Incentive compensation. Incentive
compensation to employees based on cost
reduction, or efficient performance,
suggestion awards. safety awards, etc" are
allowable to the extent that the overall
compensation is determined 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 an 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 and education aosts. See
paragraph 48. " , '
I. Suppart of salaries and wages. .
(1) Charges to 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 appro,ved
in writing by the the cognizant agency, (See
paragraph E.2 of Attachment A)
(2) Reports reflecting the distribution of
activity of each employee must be
maintained for all slaff members
(professionals and nonprofessionals) whose
compensation is charged. in whole or in part,
directly to awards, In addition, 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
activities is needed in the determination of
,
I
I
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
organiza tion.
(e) 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 term "nonprofessional
employee" shall have the same meaning as
"nonexempt employee." under the Fair Labor
Standards Act.
(4) Salaries. and wages of employees used
in_meeting 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
Ii 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
16,a.(2)(d)): pension funds (see paragraph
6,(g)); and reserves for normal severance pay
(see paragraph 44.(b)(l),
6, Contributions. Contributions and
donations by the organization to others are
unallowable,
9. Depreciaiion and use allowances.
a. Compensation for the use of buildings.
other capital improvements. and equipment
on hand may be made through use
allowances or depreciation. However. excepl
as prr'Jvided in paragraph f. below a
~omLii1alion of the two methods may not be
IIsed in connection with a single class of
fixed aSbets (e.g,. buildings, office equipment.
computer equipment. etc.).
b, The computation of use allowances or'
d,~prl'cialion shall be based on the
acquisition cost of the assets involved. The
lIcquisition cost of an asset donated 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 slatutory
matching retirement.
d. Where the use allowance metbod 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 equipmenl will
be computed at an annual rate not exceeding
six and two-thirds percent of acguisition cost.
When Ihe use allowance method'ls used for
buildings. the entire building musl 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 altached or
fastened to the building but not permanently
fixed to it and which is used as furnishings or
decorations or for specialized purposes (e,g.,
dentist chairs and dental trealment units.
counters. laboratory benches bolted to tha
floor. dishwashers, carpeting. etc.). Such
equipment will be considered as not being
permanently 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 10 the six
and two-thirds percent equipment use
allowance limitation,
e. Where depreciation melhod 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 pallern 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 eady portions of its
useful life than in the later portions. the
straight-line melhod shall be presumed 10 be
the appropriate method. Depreciation
methods once used shall not be changed
unless approved in advance by the cognizant
Fec'.:ral agency. Wben the depreciation
method is introduced for application to assels
previously subject to a use allowance. the
combination of use all'Owances and
depreciation applicable 10 such assels must
not exceed the total acquisition cost of the
assets, When the depreciation method is used
for buildin~s. a buildin~'s shell may be
A-122:6
segregated from each building component
(e.g., plumbing system, healing, and air
conditioning syslem. etc.) and each item
depreciated over its estima'ed useful life: or
the entire building (i.e.. the shell and all
components) may be trealed as a single asset
and depreciated over a single useful life.
f. When the depreciation method is used
for a particular clas8 of assels, no
depreciation may be allowed on any such
assets Ihat. 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 alTlount of depreciation
previously charged 10 the Government. the
estimated useful life remaining at time of
negotia tion. the effect of any increased
maintenaoee charges or decreased efficiency
due to age, and any olher factors pertinent to
,Ihe utilization of the asset for the purpose
contemplated,
g, Charges for use allowances or
depreciation must be supported by adequate
property records and pbysical inventories
must be taken at least once every two years
(a statiltical sampling basis is acceptable) to
ensure that 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 volunleer services may be
furnished 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.
(2J The value Df donated services utilized
in the performance of a direct cost activity
shall be considered in the determination of
Ihe organization's indired cost rate(s) and,
accordingly. shall be allocated a
proportion'lte share of applicable indirecl
costs when the following circumstances exist:
(a) The agg~egate value of the services is
material:
(b) The services are supported b~i1
significant amount of the indirect costs,
incurred by the organization:
(c) The direct cost activity is not pursued
primarily for the benefit of the Federal
Government.
(3) In those instances where Ihere is no
basis for determining the fair markel value of
Ihe services rendered, the recipient and Ihe
cognizant agency shall negotiale an
appropriale aiiocntion of indirect cost to the
services.
(4) Where dona led services directly benefit
a rrojecl supporled by an award, the indirect
cosls allocated to the services wH! be
considered as a parI of the lotal cosls of the
project. Such indirecl costs may be
reimbursed under the award or used to meet
cosl sharing or matching requirements.
(5) The vOllue of the dona led services may
be used to meet cost sharing or matching
requirements under conditions d!:scribed in
Allachment E, OMB Circular No. A-110,
Where donated services are treated as
indirect cosls, 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) lIates for volunteer services. Rates for
volunteers shall be consistent with those
regular rates paid for similar work in other
activities of the organization, 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 an employee. these services
shall be valued at the employee'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-11D.
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 thi
value of the donations so that reimbursement
will not be made.
11. Employee morgle. 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, diver< IOn, social activities.
ceremonials, and costs relating thereto, such
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~havelhe,m~(jninm; I!.~UQrth below:
(1) "Equipment" means an article of
nonexpcndable 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
nonexpendable tangible personal property I1S
deCined herein,
(2) hAcqui!ition 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 equiphlent" 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 expenditur.es 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, bt.:i1dings, 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
depreciation 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 retulations
are unallowable except when incurred as a
result of compliance with specific provisions
of an award or instructions 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, and whether owned
or leased by the organization.
[2) "Idle facilities" means completely
unuscd facilities that are excess to the
organi2.ation's current needs.
(3) "Idle capacity" means the unused
I
A-122:7
capacity of partially used facilities. It is [he
difference between tflat which a facility
could achieve under 100 per cent operating
time on a one-shift basis less operating
interruptions resulting from time lost for
repairs. setups. unsatisfactory materials, and
other normal delays, and the extent to which
the facility was actllally used to meet
demands during the accounting period. A
mullishift basis may be used if it can be
shown that this amount ofnsage could
normally be expected for the type of facility
involved.
(4) "Costs of idle facilities or idle capacity"
means cOslll such 88 maintenance, repair,
housing, rent. and other relaled cosUt; e,g.,
property taxes, insurance. and depreciation
or use allowances.
b. The costs of idle facilities are
unallowable except to the extent that:
(1) They are unnecessary to meet
fluctuations in workload; or
(2) 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
operations. reorganization, termination, or
other causes which could not have been
reasonably foreseen. Under the exception
staled 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 facilities (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 is
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 fadli ties, .
17. hdu.pc=ndent research anddovelopment
[Reserv"dj, ' .
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 opera tions. Thia paragraph
docs not apply to insurance which represents
fringe benefits for employees (see pn~agrnph
6.f. nnd 6,g,(2)).
(1) Costs of in3\lrance r~quired or
approved. and maintained, pursu'ant to the
award are allowable.
(2) Costs of other insurance maintained by
the organization in connection with the
general conduct of its operations are
allowable subject to the following limitations.
(a) Types and extent of coverage shall be
in accordance with sound business practice
and the rates Bnd premiums shall be
reasonsble under the circumstances,
(bl COSt3 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 managem...nt fees,
(c) Costs of insurance or of any pro"i~ions
for a reserve covering the risk of luss or
diimage to Government property are
allowable only to ~he extent that the
orS!~nizati!ln i~ Ijable for such 1069 or damag'~.
(u) Provisions for 8 reserve under a self-
insurar,ce program are allowable to tne
ex lent that types of coverage. ext,.nt of
coverage. ra~es, ahd premiums would have
been allowed had insurance been purchased
to cover the risks. However. provision fur
known or reasonably estimated sclf-in~ured
liabilities. which do not become payable for
more than one year after the provision is
made shall not exceed the present value of
the liability,
(e] Costs of insurance on the lives of
trustees, officers. or other employees holding
positions of similar responsibilities are
allovlBble only to the extent that the
insurance represents additional
compensation (see paragrAph 6J. The cost of
such insurance when the organization is
identified as the beneficiary is unallow..ble.
(3) Actuallosscs which could have been
covered by permir.sibte insurance [through
the purchase of insurance or a self-insurance
program) are unallowable unless expressly
provided for in the award. except:
(a) Costs incurred because of losses not
covered under nominal deductible insurance
coverage provided in k...eping with sound
business practice are allowable.
(b) Minor losses not covered by insurance.
such as spoiIage.breakag?. and
disappearance of supplies. which occur in the
ordinary COlirse of operations. are allowable.
b. Indemnification includes securing the
organization against liabilities to third
persons and any other loss or dameg?. not
compensated by insurance or otherwise. The
Government is obligated to ind~mnify the
organization only to the ex lent expressly
provided in the award.
19; Interest. fund raising. and investment
managament costs.
a. Costs incurred for interest. on borrowed
capital or temporary use of endowment
funds. however represented. are unallowable.
b. Costs of organjzed fund raising.
including financial campaigns. eHdowmp.nt
drives. solicitation of gifts and bequp.sts, and
similar expenses incurred solely to raise
capital or obtain contributions are
unallowable.
c, Costs of investment counsel and staff
and similar expenses incurred solely to
enhance income frum Investments ore
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. Labor relations costs. Costs incurred in
maintaining satisfactory relations bet.....een
the organization and its employees. including
costs of labor management r;ommittees,
employee publications, and other related
activities are allowable.
21. Losses on other awards, Any excess of
costs over income on any award is
unallowable as a cost of any other award.
This indudes. but is not limited to. the
organization's contributed portion by reason
of cost sharing agreements or any
underrecoveries through negotiation of Jump
surn8 for. or ceilings on. indir%t costs.
22. Jvlaintenance and repair costs. Cosls
incurred for necessary maintenance. repair.
or upkeep of buildings IInd equipment
[inclllding Government property unless
a:herwi~e provided for) which neither add ta
the pennanent value of thp property nor
appreciably prolong its intended life. but
keep it in an efficient operating condilion. are
allowahle. Costs incurred for i~pro\'ements
whic.h add to the permanent value of the
buildings and equipment or appreciably
prolong their intended life shall be Ireated as
capital expenditmes (see paragraph 13).
23, Materials and sl1pplie.9, The costs of
materials and supplies necessary to carry (Jut
an award are allowable. Such costs should be
charged at their actual prices after deducting
all cash diecounts. trade disr;ounts. rebates.
and allowances receiv'ed by the organization.
Withdrawals from genela] stores or
stockrooms should be charged at cost under
any recognized method of pricing
consistently applied. Incoming transportation
chargcs may be a proper part of material
cosL Materials and 8upplies chargp.d' as a
dimet cost should include only the materials
and supplies actually used for the
performance of the contract or grant. and due
credit should be given for any excess
materials or supplies retained. or return...d to
vendors,
24. Meetings. conferences.
a. Costs associated with the conduct of
meetings. and conferences. and include Ihe
cost of renting facilities. meals. speakers'
fees. and the like. But see paragraph 12,
EntertaInment costs. and paragraph 29,
Participant support costs,
b, To the extent that these costs 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 that they meet the
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, tp.chnical 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 al meetings and
conferences. sponsored by others when the
primary purpose is the dissemination of
ted:llic!ll infonnation, are allowable. This
induLles costs of meals. tra'lsportatron. and
other items incidental to such attendance,
26. Organization costs. Expenditures. such
OIS incorporation fees. brokers' fees. fees to
promoters. organizers or management
consultants. attorneys. accountants, (lr
Investment counselors. whether or not
l!mplayees of the organization. in connection
with establishment or reorganization of an
organization. are unallowable except with
prior approval of the awarding agency.
27. Ol'(]rtime. extra-pay shift. and
I
A-122:8
nll1/!ishifl pnmiums. Premiums for overtinw.
extra-pay shifts. ami mullishift work are
1I1:0\\'uLle on;)' with the prior appro_..l of :1:1.'
awarding agency excepl:
a, VVhen IIccesS?ry to cope with
er:lcr!!encies, such as those resulling [ront
Il'"cid,:r/~, natural (li~aslers. breakdowns of
cejldprr.cnt, or o(;c,,~ilJnal operilli"nal
kllllc~f'[;!<s Df u sporadic nature.
h VI/hen tr.Jpio.l'C(lS are performing indin:cl
functions sllch as i1dministration,
muintenance, or accuunting.
c, [n tile perfurmuilcc of lesls. laboratory
prlKc:dures, (Jr ulher simii..r opera tions which
are corit;nuous in nat,ure and cannot
rcuscn?~i:; be interrupted or othcrwis!!
COIl\p!~;h)(.L
d. When lower overull cost to the
(;o',;('r~;neut will result.
2/1. Page charges in professional journals.
Page charges for professional journal
publications are allowable asa necessary
part o[ research costs. where:
a, The research papers report work
supported loy the Government; and
b, The charges are levied impartiully on all
research F.Jpers published by the journat,
whelh/~r or nol by Government-sponsored
uuthnrs.
29.l'arlic;ipaJ/t support costs, Participant
support costs arc direct cosls for items such
as stipends or subsistence allowances. travel
lIllowancc~. I<nd registration fees paid to or
on behalf (J[ participants or trainees (but not
employees) in connection with meetings.
conferences, symposia. or training projects,
These cosls are allowable with the prior
approval of the awarding agency.
30. ratent costs.
a, Costs or (i) preparing disclosures,
reports. and other duc;uments requircd by the
nw;;rd (HId of searching the art to the extend
necessary to make such disclosures. (ii)
prcpnring documents and any olher patent
costs in connection with the filing and
prosecution of a United statp.s palent
npplicati0n where title or royalty-free license
is reqniJ'C'd by the Government to be
conveyed io the Government. and (iii) general
counseling services relCtting to pateh,and
copyright matters. sur;h as advice on paten}
and copyright laws. regulations, clauses. and
employee agrc-ements are allowable (bllt see
pllragraph 34),
b Cosl of preparing disclos1lles. repents,
and other documents and of searching the arl
10 the extent necessary to make di8c1osures.
if not required by the award, ue
un<lllowablc, Costs in connection with (i)
filing and prosecuting ony foreign patent
application. or (ii) any United States plltenl
application, wI, ere the Ilward docs not
require conveying title or a royalty-free
license 10 the Go\'ernment, are unallowable
(ulso iee paragraph 43).
31. Pension plans. See paragraph 6, g,
32, Plant security costs, Necessary
expenses incurred to comply with
Government security requirements or fOf
facilities protection, including wages.
unifolms. and equipment of personnel are
uIlowuble.
33, Preaward costs. Preawardcost.s are
those incurred prior to the effecti ve da te of
the award directly pursuant to the
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Office of Management and Budget Circular A-122 (6/27/80)
negotiation -and in anticipation of the "ward
whele such costs is necessary to comply with
the prof)osed delivery schedule or period of
performance. Such costs Rre allowable only
tu the e:<.tentthat they would have been
ililowable if incurred after the date of the
"w<lrd lJnd only with the written approval of
thc~warding agency,
34. prnfessional service costs.
a, Costs of profe~sional and consultant
services rendered by persons who are
n:r'''lbers of a particular profession or possess
a special skill, and who arc not officers or
empiuyees of the organization, are allowable,
subject to b. c, and d, of this paragraph when
reasolluble in r'llation.to the services
rendered and when not contingent upon
recovery of the costs from the Government.
b, (n detcrming the allowauility of r.osts in
a particular case, no single factor or any
special combination of factors is necessarily
determinative. However, the following
fat;tors are relevant:
(1) The nature and scope of the service
rendered in relation to the service required.
(2) The necessity of contracting for the
service, considering the organization's
capability in the particular area.
(:!) The past pallern of such costs.
particularly in the years prior to Government
awards,
(4) The impact of Government awards on
the organization's business (Le.. what new
problems have arisen).
(5) Whether the proportion of Government
work to the organization's total business is
auch as to influence the organization in favor
of incurring the cosl. particuhuly 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
ra ther than contracting.
(7) The qualifications of the individual or
concern rendering the service and the
customary fees charged. especially on non-
Government awards.
(0) 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 evidenr.e of bona fide services
available or rendered.
d. Cosl of legal, accounting, and consulting
sen'ices, and related cosls incurred in
COflflp.ction with defense of sntitrust suits;
and the prosecution of c1akTls against the
Government, are unallowable, Costs of legal.
accounting and consulting services, and
rela ted cos ts, incurred in connection with
palent infringement litigation, organization
and reorga~ization. are unallowable unless
otherwise provided fo;: in the award (but see
paragraph 47e 1.
35, Profits and losses on disposition of
depreciable property or other capital assets.
a. (1) Gains and 10Rses on sale, retirement.
or other disposition of aepreciable property
shdl be included in the year in which they
occur as credlls or charges to cost grouping(s)
in which the depreciation applicable to such
property was included. The amount of the
gRin or loss to be included as a credit or
charge to the appropriate cost grouping(s)
shall be the dilIerence between the amount
realized on the property and the
undepreciated basis of the property.
(2) Gains and losses on the disposition of
der,reciable property shall not bi! recognized
ElS a separate credit or charge under the
foHowing conditions.
l a) The gain or loss is processed through a
uepreciation reserve account anu is renectcu
iu the Jeprecialion allowaule under
pHragrnph 9.
(h) 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 iri
de~ermining the depreciation cost basis of the
new item.
(c) A loss results from the failure to
maintain permissible insurance, except as
otherwise pl't1Vided in paragraph 10.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 losses 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 shall be excluded in computing award-
costs.
36. Public informatiun sen'ice costs.
a. Public information service costs include
the costassociated'with pamphlets, news
releases. and other forms of information
services, Such costs. are normally incurred to:
(1) Inform or instruct individuals, groups, or
the general public.
(2) Interest individuals or groups in
participating in a service program of the
01 ganiza tion.
(3) Disseminate the results of sponsored
and non sponsored activities.
b. Public information service costs are
allowable as direct costs with the prior
approval of th" ewarding 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
s!lch processes). distribution. promotion,
mailing, and general handling.
b. If these costs are not identifiable with a
particular cost objective, they should be
aliocated as indirect costs to all benefiting
activities of the organiza tion.
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 28,
30, Rearrangement and alterotian costs.
Costs incurred for ordinary or normal
rearrangement and alteration of facilities are
allowable. Special 8;rrangement and
alteration costs incurred specifically for the
project are allowable with the prior approval
of the awarding agency.
39. Reconversion casts. Costs incurred in
the nlstorationor rehabilltation of the
organization'. facilities 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" advertising. operating costs of an
employment office. costs ofoperating an
educational testing program, trayel expenses
including food and lodging of employees
while engaged in recruiting personnel. travel
costs of applicants 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 allow8ble,
41. Relocation costs.
a. Relocation costs are cosls incident to the
permanent change of duty assignment (for an
indefinite period or for a stuted period of not
less than 12 months) of an exiRting employee
or upon recruitment of a new employee.
Relocation costs are allowable, subject to the
limitation described In parugraphs b, c, and d.
below, provided that:
(1) The move Is for the benefit of the
employer,
(2) Reimbursement to the employee is in
accordance with an established written
policy consistently followed by the employer.
(3) The reimbursement does not exceed the
employee's actual (or reasonably estimated)
expenses.
b, Al10wable 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 trunsition 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 tbe employee's former home. These costs.
together with those described in (4) below,
are limited to 8 per cent of the"sales price of
the employee's former home. '
(4) The continuing costs of ownership of
the vecant 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 normal1y incident to relocation,
such as the costs of cancelling an unexpired
lease, disconnecting and reinstalling
household appliances. and purchasing
insurance egainst loss of or damages to
personal property. The co~t of cancelling an
unexpired lea8e 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. abova. When
relocation coats incurred incident to the
recruitment of new employeas have been
allowed either all a direct or indirect cost and
the employee resigns for reasons within his
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Office of Management and Budget Circular A-122 (6/27/80)
control within 12 months after hire, the
organiza tion shall refund or credit the
Government for its share of the cost.
However, the costs of travel to an overseas
location shall be considered lIavel costs in
accordance with paragraph 50 and not
relocation costs for the purpose of this
paragraph Ii 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 associeted with
acquiring a new home.
(2) A loss on the sale of a former home.
(3) Continuing mortgage principal and
interest payments on a home being sold,
(4) Income taxes paid by Iin 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 the 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, a less-than-arms-!ength lease is one
under which one party to the lease agreement
is able to control or substantially influence
the actions of the other, Such leases include,
but are not limited to those between (i)
divisions of an organization; (ii) organizations
under r:ommon conlIol through common
officers, directors, or members; and (iii) an
organization and a director, trustee, officer,
or key employee of the organization or his
immediate family either directly or through
corporations, trusts, or similar arrangements
in which they hold a controlling interest.
d, Rental costs under leases which create a
ma terial equity in the leased properly are
allowable only up to the amount that would
be a!lowed had the organization purchased
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 more of the
following characteristics:
(1) The organization has the right to
purchase the property for a price ~hich at the
beg;nning of the lease appears to be
substantially less than the probable fair
market value at the time it is permitted to
purchase the property (commonly called a
lease with a bargain purchase option);
. (2) Title to the property passes to the
organiza tion a t some time during or after the
lease period;
, (3) The term of the lease (initialtenn plus
periods covered by bargain renewal options,
If any) is equal to 75 per cent or more of the
economic life of the leased property; i.e" the
period the property is expected to be
econor.1ically usable by one or more users.
43 floyalties and ather costs for use of
pal "r 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 performance
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 determined 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 arm's length bargaining; e.g.:
[1) Royalties paid to persons, including
C0: porations, 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 inlo after an award is made to an
organization.
c. In any case involving a patent or
copyright formerly owned by the
organization, the amount of royalty allowed
~hould not exceed' the cost which would have
been allowed had the ol'8anization retained
title thereto.
44. Severance pay.
a, Severance pay, also commonly referred
to as dismissal wages, is a payment in
addition to regular salaries and wages. by
organizations to workers whose employment
is being tenninated, Costs of severance pay
are allowable onlv to the extent that in each
case, it is required by (i) law. (ii) employer-
employee agreement, (iii) estoblished policy
that con~titutes, in efIect. an implied
agreement on the organization's part, or (iv)
circumstances of the particular employment.
b. Costs of severance payments are divided
into two categories as follows:
(1) Actual normaltrunover severance
payments 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
actualIy made for normal severances over a
representative past period, and if amounts
charged are allocated to all activities of the
organization,
(2) Abnormal or mass severance pay Is of
such a conjectural nature that measurement
or 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 its fair share, in
any specific payment. Thus, allowability will
be considered on a case.b~'-case basis in the
event of occurrence.
45. Specialized service facilities,
a, The costs of services provided by highly
A-122:10
complex or specialized facilities opera ted by
the organization. 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 lhe 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 of.l-he services. The cosls of each
service shall consist normally of both ils
direct cosls and its allocable share of all
indirecl cosls. Advance agreements pursuant
to pafllgraph A.6. of Attachment A are
particularly important in this situation.
c. Where the costs incurred for a service
are not material, they may be allocated as
Indirect costs,
46. Taxes,
a. In general, taxes which the organization
's required to pay and whi:;ll are paid or
accrued in accordance with generally
accepted accounting principles, and
payments mode to local governments in lieu
of taxes which are commensurate with the
local government services received are
allowable, except for [i) taxes from which
exemplions are available to the organization
directly or which are available to the
organization based on an exemption afrorded
the Government and in the laller case when
the awarding agency makes available the
np-cessary exem;Jtion certificates, (ii) special
llsoessments on land which represent capital
improvements, and (iii) Federal income taxes.
b. Any refund of taxes, and any payment to
the organization of interest thereon, which
were allowed as award costs, w"1 be
credited either as a cost reduction or cash
refund, as appropriate, to the Government.
47. Termination costs. Terminatidn of
Ilwardll generally give rise to the incurrence
of costs, or the need for special treatment of
costs, which would not have arisen had the
aWilrd not been terminated. Cost principles
covering these items are sel forth below.
They are to be used in conjunction with the
'other provisions of this Circular in
termination situations.
a. Common items, The cost of ilems
reasonably usable on the organization's other
work shall not be allowable unless the
organization submits evidence that it would
not retain such items at cost without
sustaining a loss. In deciding whether such
Hems are reasonably usable on olher work of
the organization, the awarding agency shouid
consider the organization's plans and orders
for current and scheduled activity.
Contemporaneous purchases of common
items by the organization shall be regarded
as evidence that such items are reasonably
usable on the 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 of
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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
requirements of other work.
b. Costs CiJnt.inwng after termination. U in
a particular case, despite all reasonable
efforts by the organization, certain costs
cannot be disCiJntinued immediately after the
effective date of termination. such costs are
generally allowable within the limitations set
forth in this Circular, axcept that any such
costs continuing after termination due to the
negligent or wilUul failure of the organization
to discontinue such costs shall be
unallowable. '
Co Loss of useful value. Loss of useful value
of srecial tooling, machinery and equipment
wh;!':h was not charged to the award as a
C3;.:ltal ':!xpenditure is generally allowable if:
I.' ; Such special tooling. machinery, or
eq, '.pment is not reasonably capable of use in
tb:. ....ther work of the organization.
[:~l The interest of the Government is
pre 1r:ted by transfer of tille or I:y other
n\f':lns deemed appropriate by the awarding
a~' ncy:
d. Rental costs. Rental costs under
ul'c,xpired leases are generally allowable
\\;~~l!re clearly shown to have been
n,,'.~onably necessary for the performance of
H:~ terminated award less the residual value
0:' such leases, if (i) the amou..1t of such rental
cluimed does not exceed the reasonable use
vabe of the property leased for the period of
the aW:Jrd and such further period as may be
rp..;JIJl:.;ble, and (il) the organization makes
all reasonable efforts to terminate. assign,
settle. or otherwise reduce the cost of such
lease. There also may be included the cost of
alterations of such leased property. provided
such aI:erations were necessary for the
performance of the award, and of reasonable
restoration required by the provisio08 of the
leQ~e.
e. Settlement expenSBtJ. Settlem!!llt
expenses including the following art'
generally allowable:
(1) Accounting. legaL clerical. and similar
costs reasonably necessary 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. (Sce parllgraph 4.8.
of Attachmcnt I.. OMB Circular No. A-no:
and
(b) The termination and settlement of
subawards.
(2) Reasonable costs for 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 OMS Circular A-ll0.
(3) Indirect costs related to sillaries and
wages incurred as settlement expenses in
subparagraphs (1) and (2) of this paragraph.
Normally. such indirect costs shall be limited
to fringe benefits. occupancy cosL and
immedia te supervision.
f. Claims under subawards. Claims under
subawards. including the allocable portion of
claims which are common 10 the award. and
to olher 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/subgrantee.; provided that the
amount allocated is otherwise consistent
with the basic guidelines contained in
Attachment A. The indirect expense so
allocated shall exclude the same and similar
costs claimed directly or indirectly as
settlement expenses.
48. Trairung and education costs.
a. Costs of preparation and maintenance of
a program oC instruction including but not
limited to on-the-job. classroom. and
apprenticeship training. designed to increase
the vocational effectiveness of employees,
including training materials. textbook."
salaries or wages of trainees (excluding
overtime compensation which might arise
therefrom), and (i) salaries of the director of
training and staff when the training program
is conducted by the organization: or (ii)
tuition and fees when the training is in an
inatitution Dot operated by the organization.
are allowable.
b. Costs of part-time education, at an
undergraduate or postgraduate college leveL
including that provided at the organization'.
own facilities. are allowable only when the
course or degree pursued is relative 10 the
field in which the employee i. now working
or may reasonably be expected to work. and
are limited to:
(1) Training materials.
(2) Textbooks.
'(3) Fees charges by the t1ducational
institution.
(4) Tuition charged by the educational
institution. or in lieu of tuition. instructOr:!'
salariea and the related share of indirect
costs of the educational institution to the
extent that the sum thereof is not in excess of
the tuition which would have ben paid to tha
participating educational institution.
(5) Salaries and related costs of instructors
who are employees of the organizatioa.
(6) Straight-time compensation of each
employee for time spent attending classetl
during working hours not in excess of 156
hours per year and only to the extent that
circumstances do not permit the operation of
classes or attendance at classes after regular
working hours; otherwise such compensation
is unallowable.
c. C..,sts of tuition. fces. trainbg materials.
and textbooks (but not subsistence. salary. or
any other emoluments) 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 to the field in which
the employee is now working or may
reasonably be expected to work. and only
where the costs receive the prior approval of
the awarding agency. Such costs are limited
to the costs attributable to a total period not
to excee:l one school year for each employee
so trained. In unusual cases the period may
be extended.
d. Costs of attendance of up to 16 week3
per employee per year at specialized
programs specifically designed to enhance
the effectiveness of executives or managen
or to prepare employees for such positions
are allowable. Such costs include enrollment
I
A-122:11
fees, training materiala. textbooks and
related charges. employees' saleries.
subsistence, and traveL Costs allowable
under this paragraph do not includetbose for
courses that are part of a degree-oriented
curriculum. which are allowable only to the
extent set forth in b. and Co 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 donations to
educational or training institutions, including
the donation of facilities or other properties.
and scholarships or fellowships. are
unallowable.
g. Training and education costs in excess oj
those otherwise allowable under paragraphs
...I), and c, of this paregraph may be allowed
with prior approval of the awarding agency.
To be considered forepproval. the
organization must demonstrate that such
costs are consistently incurred pursuant to an
8stublished 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 costs. Transportation
costs include freight, express, cartage. 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 iteDUI involved,
they may be directly charged as
transportation costs or added to the cost of
such items (see paragraph Z3). Where
Identification with the materials received
cannot readlly be made, transportation costs
may be charged to the appropriate indirect
cost accounts if the organization follows a
consistent. equitable procedure in this
resped.
SO. Travel CiJsts.
a. Travel costs are the expenses for
transportation, lodging. subsistence, and
related items incurred by employees who are
in tra vel status on official business of the
organization. Travel cosls are allowable
subject to paragraphs b. ilirough e. below,
when they are directly attributaole to specific
work under an award or are incurred in the
normal course of administration of the
organization.
b. Such roosts may be charged on an actual
basis, on a per diem or mileage basis in lieu
of actual costs incurred, or on a combination
of the tWo, proYided the method used results
in charges consistent with those normally
allowed by the organization in its regular
operations.
c. The diIIerence in cost between fint-class
air accommodations and less than first-class
air accommodations is unallowable except
when less than first-class air
accommodations are not reasonably
available to meet necessary mission
requirements, such as where less than finlt.
class accommodations would (i) require
circuitous routing. (ill require travel during
unreasonable hours. (ii1) greatly increase the
duration' of the flight. (iv) result In additional
costs which would offset the transportation
savings, or (v) offer accommodations which
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Office of Management and Budget Circular A-122 (6/27/80)
are not reasonably adequate for the medical
needs of the traveler.
d; Necessary and l'8880nable costs of
family movement. and personnel movements
of a special or maSl nature are allowable,
pursuant to paragrapha 40 and 41, subject to
allocation on the basis of work or time period
ber:efited when appropriate. A~vance
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 trip must be approved. For
purposes of this provision. foreign travel is
defined as any travel outside of Canada and
the United States and its territories 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 not Subject to this
C;n;ular
Aerospace Corporation. El Segundo,
California
Argonne Universities Association. Chicago.
lllinois
Associated Universities, Incorporated.
Washington. D.C.
Associated Universities for Research and
Astronomy, Tucson, Arizona
Atomic Casualty Commission, Washington.
D.C.
Battelle Memorial Institute, Headquurtered 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). Oskridge,
Tennp.~see
environmental Institute of Michigan. Ann
Arbor, Michigan
Hanford Environmental Health Foundation.
Richland, Washington
lIT Research Institute. Chicago. illinois
In~tilute for Defense Analysis. Arlington.
Virginia
Institute of Gas Technology. Chicago. lllinois
Midwest Research Institute. Headquartered
in Kunsas City, Missouri
Mitre Corporation. Bedford. Massachusetts
Montana Energy Research and Development
Institute, Inc~ (MERDI). Butte. Montana
National Radiological Astronomy
Observatory, Green Bank. West Virginia
Oakridge Associated Universities, Oakricl8e.
Tennessee
Project Management Corporation, Oakridge,
Tennessee
Rand Corporation. Santa Monica. CalifomJa
Research Triangle Institute, Research
Triangle Park. North Carolina
Riverside Research Institute, New York. New
York
Sandia Corporation. Albuquerque. New
Mexico
Southern Research Institum. Birmingham,
Alabama
Southwest Research Inatitute, San Antonio.
Taxa.
SRI International. Menlo Park. CallIornJa
Syracuse Research Corporation. Syracuae,
New York
Universities Research Association,
Incorporated (National Acceleration Lab),
ArgoMe. nlinois
Universities Corporation for Atmospheric
Research. Boulder. Colorado
Nonprofit Insurance Companies such as Blue
Cross and Blue Shield Organizations
Other nonprofit organizations 8S negotiated
with awarding agencies.
[FR Doc. 1lO-2lIZ7O f1lod 7-7-<<3: 8:45 ImJ
~ CODE 3110-0141
Editorial Corrections to
OMS A-122
OFFICE OF MANAGEMENT AND
BUDGET
Circular A-122, "Cost PrInciples for
Nonprofit Organizations"; Correction
AOENCY: Office of Management and
Dudget.
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 Dranch. Office of
Management and Dudget, Washington,
D.C. 20503, (202) 395--4773,
I Page 46022. column 2 the second
Paragraph 1, change Paragraph 5
"Compensation for Personnel Services"
to Paragraph 6.
, I 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.
I Paragraph 5, change Paragraph 26
"Meetings" to Paragraph 24,
I Paragraph 6, change Paragraph 27.
"Organi:r;ation Costs" to Paragraph'26,
I Paragraph 7. change' Paragraph 30
"Page charges in Professtional Journals"
to Paragraph 26. '
I Paragraph 8, change paragraph 37
"Public Information Service Costs" to
Paragraph 36.
I Paragraph 9, change Paragraph 43
"Rental Costs" to Paragraph 42,
I Paragraph 9a: in the fourth line. add
"up" between the words "only" and
"to"; in the sixth line change "they" to
"it" .
I Paragraph 10, change Paragraph 51
"Travel Cosls" to Para~raph 50,
------1------
A-122:12
I Page 46024, column 3 Paragraph
4(a)(2) after "benefits received" add ";
or",
I Page 46025, column 1 Paragraph D3,
change the reference."Paragraph 21 of
Attachment B" to "Paragraph 19 of
Attachment D,"
I Page 46026, column 1 Paragraph
4a.iii, in the sixth line, change "direct
cost" to "direct costs,"
I Page 46026. column 2 Paragraph
Ele, change "e'stablishment of a rate" to
"establishment of a final rate."
I 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."
I Pale 46027, column 3 Paragraph
, (3)(a), chan~e "workmen's
compensation" to "workerp'
compensation."
I Page 46028, column 1 Paragraph
Of3(b), (the second line of colwnn 1)
change "Workmen's compensation" to
"workers' compensation."
I Page 46030, .column 3. paragraph
24b., the sixth line, change "allowable"
to "allowability".
Daniel F. Mann.
Budget and Management Officer.
IfR Doc. 81-1lO73 flied 3-llI-llI: 8:45 am)
BILLING COOE 311D-OI-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
6. 1980. the following changes should be
made:
1. On page 46024, colwnn three, the
second sentence in paragraph 'A.5.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.6. should read. "This is particularly
true in connection with organizations
that receive a preponderance of their
support from Federal agencies,"
3. On page 46025, column one,
paragraph D.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
IIpplied to all final cost objectives."
<'....
.~
I
Office of Management and Budget Circular A-122 (6/27/80)
4. On page 46025, 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 46025, column two. the fir~t
sentence in paragraph D.l.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 D.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 46020, column one. the first
sentence in paragraph D.3.e. should
read, "The distribution based used in
computing the indirect cost rate for each
function may be total direct costs
(excluding capital expenditures and
other distorting items such as major
subcontracts and subgrants), direct
salaries and wages. or o.ther base which
results in an equitable distribution."
8, On page 46020, column one, the first
and second sentences in paragraph
D.4.a. should read, "Some nonprofit
organizations treat all costs as direct
costs except general administration and
general expenses, These organizations'
generally separate their costs into three
basic ca tegories:' . .,"
9. On page 46026. the last sentence in
column one (extending to column two).
in paragraph D,S. should read, "The
factors may include the physical
location of the work, the level of
administrative suppor! required. the
na ture of the facili ties 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.i. should read. "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 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 ~ead, "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.
A-122:13
should read. "Such costs are allowable,
provided the capacity is reasonably
anticipated to be necessary or was
originally reasonable and is nol subject
to reduction or elimination by subletting,
renting, or sale, in accordance with
sound business, economics or security
practices,"
13. On page 46031, 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."
~ILUNG CODE lSO!;-()l-M
'\