1. Grants Administration Updates - OMB’s Uniform Guidance Division of Grants Administration Office for Grants and Federal Fiscal Compliance Texas Education Agency ACET Fall Conference October 9, 2014 © 2014 by the Texas Education Agency

2.  Cost Principles ◦ A-87 – LEAs and ESCs ◦ A-21 – IHEs ◦ A-122 – Nonprofit Orgs  Admin Rules ◦ A-102 – LEAs and ESCs ◦ A-110 – IHEs/Nonprofits  Audit Rules ◦ A-133 ◦ A-50 OMB Uniform Guidance One Set of Rules for All Federal Grants

3.  Effective December 26, 2014  Applies to all new federal awards on or after this date  Does not apply to grants awarded prior to 12/26/14  Any carryover funds will follow current rules, not the rules from original grant award Uniform Guidance Effective Date

4.  Auditors and Monitors: ◦ Outcomes vs. Process  Flexibility for Grantees  Major emphasis on “strengthening accountability” A New Focus: Performance and Compliance

5. Most Significant Changes  Time and effort requirements  “Specific conditions” option  Subrecipient monitoring requirements  Monitoring findings and resolution requirements

6. Time and Effort Requirements  Certifications  Substitute system

7. Specific Conditions  “High-risk” grantee designation  Review of each subrecipient’s risk level

8. Subrecipient Monitoring Requirements  Scope of monitoring determined by each subrecipient’s risk  Possible monitoring activities

9. Monitoring Findings and Resolution Requirements  Raising thresholds for: ◦ Required single audit ◦ Questioned costs

10. Key Sections of Uniform Guidance

11.  Salaries of administrative and clerical - charged as indirect costs  Can be charged as direct costs only if: ◦ Services integral to grant ◦ Staff specifically identified with activity or project ◦ Costs explicitly included in the budget ◦ Costs not recovered as indirect costs Direct Costs (Sec. 200.413)

12.  Advertising/Public Relations – allowable for programmatic purposes  Conferences – meals, local travel, and finding dependent care resources  Travel Costs – participation in conference was necessary for the project Selected Items of Cost (Sec. 200.420 – 200.475)

13.  Time & Effort  Substitute systems encouraged if approved by TEA  Records that meet standards – no further documentation needed Compensation – Personal Services (Sec. 200.430)

14.  Grantee must perform a cost or price analysis for every procurement action in excess of $150,000  Independent estimates must be made before receiving bids and proposals Contract Cost and Price (Sec. 200.323)

15.  Competitive quotations not required for “micro-purchases” of $3,000 or less  Small purchase procedures for services or supplies not exceeding $150,000  Sole Source - used only under certain circumstances ◦ new circumstance – authorized by TEA Methods of Procurement (Sec. 200.320)

16.  Micro-purchases must be distributed equitably among qualified suppliers  The price must be reasonable Micro-Purchases (200.320)

17. New Definition:  “Machines used to acquire, store, analyze, process, and publish data and other information electronically, including accessories…” Computing Devices (Sec. 200.20)

18.  Cannot encumber property without approval of TEA and/or USDE  Equipment may be used for other projects if it does not interfere with the work on the projects for which it was originally acquired  Preference must be given to certain projects as specified in the Uniform Guidance Equipment (Sec. 200.313)

19.  Grantee or applicant must disclose in writing all violations of Federal criminal law potentially affecting the Federal award, involving: ◦ Fraud ◦ Bribery ◦ Gratuity Mandatory Disclosures (Sec. 200.113)

20.  For grant expenditures, authorized official will certify that: ◦ Reports are true and accurate ◦ All expenditures are allowable under the grant ◦ There is no “false, fictitious, or fraudulent information”  This is a legally binding certification Required Certifications (Sec. 200.415)

21.  Grantee may seek prior written approval from TEA for “indirect costs” or “special or unusual costs”  May prevent future disallowance or dispute based on “unreasonableness” or “non allocability” Prior Written Approval (Sec. 200.407)

22.  Establish effective internal control  Evaluate and monitor compliance  Take prompt action when noncompliance identified  Take reasonable measures to safeguard personally identifiable information Internal Controls (Sec. 200.303)

23.  A process that provides “reasonable assurance” that objectives are met  A system that reduces the risk of fraud, waste, and abuse  Three types of internal controls: ◦ Preventative ◦ Detective ◦ Corrective What Are Internal Controls?

24.  New TEA guidance handbook to be released  COSO Integrated Framework  GAO Standards for Internal Control (Green Book) Internal Controls Guidance and Resources

25.  The grantee must have written procedures to implement the requirements of the Cash Management Improvement Act (CMIA) rules for payments Written Procedures for Payment (Sec. 200.305 and Sec. 200.302)

26.  The grantee must have written procedures for determining the allowability of costs in accordance with the Omni-Circular. Written Procedures for Allowable Costs (Sec. 200.302)

27.  The grantee must have documented procurement procedures  Can only contract with responsible contractors Written Procedures for Procurement (200.318)

28.  The TEA must establish conflict of interest policies for Federal awards  The grantee or applicant for a Federal award must disclose in writing any potential conflict of interest Conflict of Interest (200.112)

29.  Review new Uniform Guidance  Develop written policies and procedures for new and revised requirements  Ensure all appropriate staff are trained on new Uniform Guidance Next Steps for Subrecipients

30.  Grants Administration  www.tea.state.tx.us/grants www.tea.state.tx.us/grants  Under ‘Grant Resources’ section: TEA Resources

31. Uniform Guidance Online www.ecfr.gov Title 2 – Grants and Agreements Subtitle A, Chapter II, Part 200

32. Division of Grants Administration Office for Grants and Federal Fiscal Compliance Texas Education Agency grants@tea.state.tx.us (512) 463-8525 www.tea.state.tx.us Contact Information

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