10/01/2024 | Press release | Distributed by Public on 10/01/2024 10:36
Federal funding agreements such as grant awards, and cooperative agreements provide the means to transfer money, technical assistance, and expertise to partners in exchange for their contributions to federal public service goals and objectives. The duration and amount of an award may vary depending on the nature of the project.
Administration for Children and Families (ACF) administers two types of awards: discretionary and non-discretionary (i.e. mandatory).
Discretionary awards and/or cooperative agreements permit the Federal government, according to specific authorizing legislation, to exercise judgment, or "discretion," in selecting the applicant/recipient organization, through a competitive grant process.
Non-discretionary awards are those that a federal agency is required by statute to award if the applicant submits an acceptable State Plan or application and meets the eligibility and compliance requirements of the statutory and regulatory provisions of the program. Non-discretionary recipients are usually states, tribes, and territories.
Notice of AwardAward Terms and ConditionsCost Considerations
The Notice of Award (NoA) is the official legal document that notifies the recipient that a federal award has been made. Upon receipt of the NoA, the recipient may request funds from the Payment Management System(PMS) and program work may begin.
The NoA is an essential resource throughout the life of the award and contains critical information about the award, including:
A revised NoA is issued if there are any approved post‐award changesmade to the award.
The NoA can be accessed through GrantSolutions, at the Grant Details Screen for the applicable award. Here, the NoA and subsequent amendments can be viewed, downloaded, and printed for your records.
Federal awards are subject to legally binding requirements called terms and conditions. Recipients must review and comply with all terms and conditions identified under the award. Drawing funds from the Payment Management System indicates acceptance and agreement to the terms and conditions of the award.
Recipients must adhere to:
Recipients with awards involving property must also follow the property related terms and conditions. Under 45 CFR §75.323, all real property, equipment, and intangible property acquired or improved with ACF funds must be held in trust by the non-federal entity as trustee for the beneficiaries of the project or program under which the property was acquired or improved.
Costs allowed or unallowed are unique to each federal program and are found in the applicable Federal laws, regulations, policies, and terms and conditions of the federal award pertaining to the program.
In general, "allowable costs" refers to items of cost that meet the General Principles for Cost Allowability. "Unallowable costs" are those charges that cannot be covered or reimbursed by a federal award. Standard unallowable costs, for instance, may be identified in Program regulations, Notices of Funding Opportunity (NOFO), 45 CFR Part 75, Subpart E (when applicable), Fiscal Year Audit Compliance Supplement , Use of Assistanceunder the Assistance Listings , and Terms and Conditions of Awards.
To be considered allowable under a federal award, costs must be:
A cost is necessary if it meets a program objective and addresses an existing need. A cost is reasonable when in its nature and amount, does not exceed those which would be incurred by a prudent person under the circumstances prevailing at the time the decision was made to incur the cost.
Consider the following when determining the reasonableness of costs:
Direct costs should be easily identified as benefiting a particular project, program, or activity. Direct costs may include salaries, travel, equipment, and supplies that directly benefit the program, although this list is not exclusive and may include other cost categories.
It is possible that only a portion of direct costs are allocable to a federal award, in which case, the recipient should have a cost allocation plan in place to effectively account for the calculation used for the portions of costs being charged directly to the federal award.
Costs that cannot be easily identified as part of a specific project, program, or organizational activity, but are necessary for agency operations, are typically classified as indirect costs. Common indirect costs include those related to:
Indirect costs are allowable based upon the organizations negotiated indirect cost rate agreement , central service, or public assistance cost allocation plan from the cognizant federal agency ; or by utilizing the de minimusrate or a rate established by federal statute or regulation for a particular program.
Once a cost has been determined to be allowable, it must be allocable. A cost is allocable when the goods or services acquired are chargeable to the federal award in accordance with the relative benefit received. When determining the extent to which expenditures are allocable to a particular grant award, consider:
Costs must also be treated consistently with other costs incurred for the same purpose in like circumstances.