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COGR Update: Focus on the Proposed OMB Guidance

COGR Update: Focus on the Proposed OMB Guidance. Financial Research Administration Conference (FRA) Monday, March 11, 2013 Presented by: Sheraton New Orleans David Kennedy New Orleans, Louisiana Director. COGR. Council on Governmental Relations ( www.cogr.edu ), established in 1948

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COGR Update: Focus on the Proposed OMB Guidance

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  1. COGR Update: Focus on the Proposed OMB Guidance Financial Research Administration Conference (FRA) Monday, March 11, 2013 Presented by: Sheraton New Orleans David Kennedy New Orleans, Louisiana Director

  2. COGR • Council on Governmental Relations (www.cogr.edu), established in 1948 • 185+ member institutions • Staff of 5: Costing, Compliance, Intellectual Property • Active Board and Committees, comprised of 25 individuals from member institutions • Close working relationship with other Higher Education Associations

  3. COGR Staff • Tony DeCrappeo, President • Carol Blum, Director Research Compliance and Administration (RCA) • Bob Hardy, Director Contracts and Intellectual Property (CIP) • David Kennedy, Director Costing Policies • Anne Taylor, Office Manager

  4. COGR Board Leadership • Denise McCartney, Washington University Board Chair • James Tracy, University of Kentucky Chair, Research Compliance and Administration • David Winwood, Univ. of Alabama, Birmingham Chair, Contracts and Intellectual Property • Susan Camber, University of Washington Chair, Costing Policies

  5. COGR Mission Foster strong working relationships with Federal Agencies and their representatives. Primary goals are to facilitate federal policies and regulations affecting university research, and to advocate for and represent the research and university community with a single voice. √ Comment Letters on Proposed Regulations √ Troubleshoot on behalf of Membership √ Policy Papers, Publications, and Surveys √ Update Letters to the Membership, 7-8 per year √ Membership Meetings, 3 per year √ Other, as needed

  6. Agenda for this Session • What did OMB put out there? • Quick Orientation on the FULL TEXT, Table of Contents (TOC) • COGR Preliminary Assessment • Next Steps

  7. Federal Register, Feb. 1, 2013 • Federal Register Notice (15 pages) • FULL TEXT: Proposed OMB Uniform Guidance • 241 pages (or 244 for the eager ones) • Crosswalks to “Old Circular” docs • Plus definition crosswalks • http://www.whitehouse.gov/omb/grants_docs#proposed

  8. FULL TEXT, TOC • Subchapter A – General Provisions • Subchapter B – Pre-award Requirements • Subchapter C – Federal Award Notice • Subchapter D – Inclusion of T&Cs • Subchapter E – Post Federal Awards Reqs (Subrecipient Monitoring and Cost Sharing) • Subchapter F – Cost Principles (Effort Reporting, old section J, etc.)

  9. FULL TEXT, TOC • Subchapter G – Audit Requirements • Subchapter H – Appendices I – Definitions II – Notice of Funding Opportunity III – Contract Provisions IV and V – Indirect Costs (Universities) VI, VII, VIII – State and Local IX – Nonprofit Organizations X – Hospital Cost Principles (TBD) XI – Audit Data Collection Form XII – Compliance Supplement

  10. Subchapter B __ .204(b)(B) – Funding announcements that include Limits on the Negotiated F&A rate require approval by the Agency head and OMB (also see .616(c)(1)). COMMENT: More transparency still needed, role of OMB/enforcement needs clarified, and .616(c)(1) consistency

  11. Subchapter E __ .501(b)(3) – Clarifies Subrecipient vs. Contractor definitions/relationship and confirms the institution is the best to make the judgment in classifying the relationship. COMMENT: Positive

  12. Subchapter E __ .501(c)(1)(D) – Negotiated F&A rate should be passed through from the Pass-through to the Sub, or a de-minimis rate of 10%. COMMENT: Positive, but 20% may be more appropriate

  13. Subchapter E __ .501(c)(5) – Monitor the activities of Subrecipients. While we support effective oversight practices for Subs, the new guidance is overly prescriptive. Also, the guidance needs to address relief when the Sub is covered by the Single Audit. COMMENT: Significant revision is needed to reduce new burdens – also, consistency with Single Audit guidance is needed

  14. Subchapter E __ .502(a) – Require recipients to relate Financial data to Performance accomplishments whenever practicable. COMMENT: This will lead to new and unrealistic reporting burdens

  15. Subchapter E __ .502(f)(1) – Voluntary Committed Cost Sharing is not expectedand is not to be used as a factor in the review of applications. COMMENT: Positive

  16. Subchapter F __ .601 – Policy Guide: Elimination of Dual Role of Students and resulting benefit to Federal research (per A-21, A.2.c). COMMENT: Key principle of the partnership; add-back language

  17. Subchapter F __ .602(b) – CAS and DS-2 Requirements are eliminated, though if Federal contracts awarded exceed $25 million in a year, DS-2 still is applicable. COMMENT: Positive for most

  18. Subchapter F __ .607(d) – Allocable costs: Elimination of language; the Cost of Equipment is allocableregardless of the subsequent use of the equipment (per A-21, C.4). COMMENT: Add-back

  19. Subchapter F __ .615(d) – Salaries of Administrative or Clerical staff allowable as a Direct Chargewhen integral to the project. COMMENT: Positive, though review “explicitly budgeted” requirement

  20. Subchapter F __ .616(e) – De-minimis F&A rate of 10%is available to any entity that does not have a negotiated F&A rate. COMMENT: Positive, but 20% may be more appropriate

  21. Subchapter F __ .616(e) – A cost item may be excluded from MTDC (and application of F&A rate)when cognizant or awarding agency determines it is necessary to avoid serious inequity. COMMENT: Needs to be addressed; if not, keeps open the door to more “Genomic Array” situations

  22. Subchapter F __ .616(e) – Entities may apply for One-time, 4-year Extension of Negotiated F&A rate. COMMENT: Positive

  23. Subchapter F __ .621(C-10 and C-11) – Compensation-Personal Services (aka, Effort Reporting)and Fringe Benefits; significantly updates Circular A-21, J.10. COMMENT: 1) Elimination of “examples”, allowable compliance activities, and flexibilities (e.g., 1-year certification cycle, responsible person can certify, reports may be integrated with payroll system) are positive; 2) more prescriptive language (e.g., def-inition of full-time workload, review budget estimate quarterly) is of concern; 3) fringe benefit language (pensions, worker’s comp, leave) has been updated.

  24. Subchapter F __ .621(C-15(3)(A)(iii, iv) – Acquisition Cost/Depreciationon a matching requirement or for a non-Federal award is not allowed. COMMENT: May adversely impact some F&A rates

  25. Subchapter F __ .621(C-18(B)) – Equipment definition now includes Software. COMMENT: Overly prescriptive definition of equipment/software

  26. Subchapter F __ .621(C-31(4)) – Computing Devices less than $5,000 allowable as a direct charge when essential and allocable (and even if not solely dedicated) to the project. COMMENT: Positive

  27. Subchapter F __ .621(C-31(6)) – Residual Inventory of less than $5,000 may be retained upon completion of the Federal project, with no obligation. COMMENT: More analysis required

  28. Subchapter F __ .621(C-53) – Costs incurred for Temporary Dependent Care directly resulting from such travel are allowable. COMMENT: Positive; though policy must extend to all sources of funds

  29. Subchapter H __ Appendix IV.(B.4.c) – Sub-building Metering or an “Effective Square Footage”factor (i.e., weighted research space via an energy use index) replaces the 1.3% UCA (per A-21, F.4.c). COMMENT: F&A rate may be more fair, assuming methods are not overly complex

  30. Subchapter H __ Appendix IV.(C.8) – Eliminates the restriction on moving a charge from F&A to Direct(per A-21, G.8.d). COMMENT: Positive; permits more rational internal costing practices

  31. Subchapter H __ Appendix IV.(C.10.g) – The cognizant agency shall formalize F&A Rate adjustments, the actual amount, both dollar and percentage adjusted, and the reason for making adjustments. COMMENT: Transparency is needed prior to negotiating the F&A rate, not after

  32. Subchapter G __ .700 thru __ .721, and Compliance Supplement (CS). Single Audit threshold increased to $750k may mean we cannot rely on a Single Audit for certain Subrecipients. Uncertain on how new thresholds/rules for Type A and B programs will affect grant recipients. Reduction of “compliance requirements” from 14 to 6 per the CS may require grant recipients to more actively review annual updates to the CS. Audit-burden still a concern, though agency consideration of “duplicate audits” is acknowledged in __ .713(a)(6)

  33. Next Steps • Request 30-day Extension; to be determined • Collaborate with Associations (AAU, APLU, AAMC, AIRI, Council of Nonprofits, States, etc.) • COGR Workgroups and COGR Membership • April 19th COGR Draft - approximately • June 1st, COGR Final - if Extension granted • OMB Final Guidance - end of 2013?

  34. COGR Staff & Contact Information, (202) 289-6655 Tony DeCrappeo, President tdecrappeo@cogr.edu Carol Blum, Director, RCA cblum@cogr.edu Robert Hardy, Director, CIP rhardy@cogr.edu David Kennedy, Director, Costing Policies dkennedy@cogr.edu Anne Taylor, Office Manager ataylor@cogr.edu

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