Sneak Preview: NSF Promises To Better Monitor Property Purchased Under Awards

(The following was excerpted from a recent Thompson Grants 360 article.) The National Science Foundation (NSF) has committed to strengthen award terms and conditions to enable it to better account for and monitor equipment its award recipients purchase with NSF funding, in response to a recent report issued by its Office of Inspector General (OIG).

NSF is the funding source for approximately 25% of all federally supported basic research conducted by institutions of higher education (IHEs). NSF award funds often are used to purchase scientific and research equipment. NSF also funds major multi-user research facilities (“major facilities”) such as giant optical and radio telescopes, ships for ocean research and gravitational wave observatories.

For equipment acquired under an NSF award, the agency has authority to vest title in the government, making it government-owned equipment (GOE), or to vest title in the recipient. The uniform guidance refers to GOE as “federally owned property” (§200.312), and NSF reports that it is transitioning to use of this term. When NSF vests equipment title in the IHE, it may allow the recipient to keep equipment after the award period, or it may choose to identify the equipment as federally owned property in an award’s terms and conditions.

OIG found that the award type and recipient type determine which terms NSF include in an award and serve as the general basis for where title to equipment vest. However, NSF may default from the general basis. For example, even though awards made to IHEs typically vest equipment in the recipient, NSF may choose to vest title to equipment in the government, and this decision would be reflected in the award letter. If NSF issues an award with terms vesting title to equipment in the government, both NSF and the award recipient have additional reporting and oversight responsibilities (see, for example, §200.312(a)).

OIG claimed that NSF did not have sufficient controls to account for certain types of equipment purchased by award recipients, as NSF did not always:

• account for federally-owned property held by award recipients;
• ensure its award letters contained the correct terms and conditions regarding equipment title; or
• ensure recipients properly handled federally-owned property after award expiration.

(The full version of this story has now been made available to all for a limited time here.)

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