Sneak Preview: OMB Proposes To Add Definitions, Support Use of Credible Evidence

(The following was excerpted from a recent Thompson Grants Compliance Expert article.) The Office of Management and Budget (OMB) plans to include several new definitions (§200.1) within its proposed revisions to Subpart A of the uniform guidance (2 C.F.R. Part 200), while also aiming to revise the mandatory disclosure provision (§200.113) in Subpart B to support the use of “credible evidence.”

OMB proposes numerous other revisions to Subparts A and B to meet its goal in updating the guidance — to address administrative priorities, offer streamlining, and reduce burdens for agencies and recipients. The revisions were published as proposed guidance in the Oct. 5 Federal Register.

One key change OMB proposes is to generally strike the use of the term “nonfederal entity” throughout the guidance and instead use the terms “recipient” and “subrecipient,” as appropriate (although it still retains the use of “nonfederal entity” in several specific instances where the terminology applies). It adds that using the terms subrecipient or subrecipient in this definition may provide further clarity on the application of the Build America Buy America Act (Pub. L. 117-58) (see ¶446 in the Federal Grants Management Module) to federal awards made to for-profit organizations. In addition, OMB refers to “federal agencies” throughout the guidance, rather than “federal awarding agencies” as used in the existing guidance, and deletes the term “federal awarding agencies” from §200.1.

Within the proposed updates to the definitions in §200.1, OMB clarifies that “where the following definitions implement specific statutory requirements that apply governmentwide, such as the Single Audit Act, the following definitions take precedence over federal regulations.”

New definitions OMB proposes to add to §200.1 are:

• Continuation funding — a discretionary decision by a federal agency to fund a second or subsequent budget period within the period of performance.
• For-profit organization — generally an organization or entity organized for the purpose of earning a profit. The term includes but is not limited to: (1) an “S corporation” incorporated under Subchapter S of the Internal Revenue Code; (2) a corporation incorporated under another authority; (3) a partnership; (4) a limited liability company or partnership; and (5) a sole proprietorship.
• Key personnel — any individuals (including employees and contractors) working under a federal award that are designated in the federal award as being particularly integral or meaningful to the program.
• Participant — generally an individual who is not a recipient or subrecipient staff member or consultant, or an individual who is developing or leading the implementation of the federal award, but rather attending, benefitting from or is otherwise playing a role in the overall program activities. Examples include community members participating in a community outreach program, members of the public whose perspectives or input are sought as part of a program, exchange students or conference attendees.
• Prior approval — the written approval by an authorized official of a federal agency or pass-through entity of certain costs or programmatic decisions.

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

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