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Recent Changes Published in Part 200 Uniform Guidance -- Cost Principles Steve Bradley,

Recent Changes Published in Part 200 Uniform Guidance -- Cost Principles Steve Bradley, Director. Agenda. New Structure (“Roadmap”) Highlighting relevant F&A and Cost Principle sections Costing Principles Including eliminations of prior A-21 sections MAXIMUS Impact Assessment

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Recent Changes Published in Part 200 Uniform Guidance -- Cost Principles Steve Bradley,

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  1. Recent Changes Published in Part 200 Uniform Guidance -- Cost Principles Steve Bradley, Director

  2. Agenda • New Structure (“Roadmap”) • Highlighting relevant F&A and Cost Principle sections • Costing Principles • Including eliminations of prior A-21 sections • MAXIMUS Impact Assessment • Resources

  3. Structure (cont.) • Subpart E– Cost Principles (A-21, A-87, A-122)

  4. Structure (cont.) • Subpart F – Audit Requirements (A-133) • Appendices (combination of all 8 Circulars) • I – Notices of Funding • II – Contract Provisions • III -- F&A for Educational Institutions (A-21) • IV – Indirect for Non-Profits (A-122) • V – State/Local Cost Allocation Plans (A-87) • VI – Public Assistance (A-87) • VII – State/Local Indirect Cost Plans (A-87) • VIII – Non-Profit Exemption from Cost Principles (A-21) • IX – Hospitals (TBD) • X – Audit Data Collection (A-133) • XI – Single Audit Compliance Supplement (A-133)

  5. OMB Changes – Combine Circulars • Consolidate A-87, A-21 and A-122 Cost Principles • Create a common accounting standards for all grant recipients • IMPACT • --Probably add more confusion than clarity • --Universities are much different than Non-profits and State/Local Govt’s • --Document littered with “exceptions” (e.g., A-21 26% Admin cap )

  6. OMB Changes – Flat Rate • For F&A costs, use a flat rate instead of current negotiated rate system – NOT in new guidance • IMPACT • GREAT! • Flat / “tiered” rate idea was not well received and has been dropped

  7. OMB Changes – UCA (App. III B.4.c) • Maximum 1.3 Utility Cost Adjustmentwith “Utilities” allocations based on “Effective square footage” • ESF is actual SF times “Relative Energy Utilization Index (REUI) • REUI is currently 2X • OMB will adjust factor “no more often than annually nor less often than every 5 years” • Allows metering at a Sub-Building level???? • IMPACT • GREAT (for some)! • Increase burden (for others)! • Perhaps aDouble-Edged Sword? • Schools will now have to develop data for their Utilities pools • “Separate Proposal”

  8. OMB Changes – Eliminate Required Study • Eliminaterequirement for institutions to conduct studies for cost reasonableness for Large Research Facilities • prior A-21, F2 • IMPACT • --GREAT! • --Reduce administrative burden

  9. OMB Changes – Eliminate Mandated F&A Usage • Eliminaterequirement that certain institutions must use F&A recoveries associated with depreciation to acquire or renovate research buildings or equipment • prior A-21, J14h • Currently applies to 99 schools • IMPACT • --GREAT! • --Reduce administrative burden

  10. OMB Changes – Eliminate Required Analysis • Eliminate requirement that schools perform a Lease Purchase Analysis to justify External Bond Interest • prior A-21, J26 • now Subpart E, 200.449 • IMPACT • --GREAT! • --Reduce administrative burden • --But, Retained “25% Equity Contribution” rule

  11. OMB Changes – DS-2 (Subpart E, 200.419) • Disclosure Statements (DS-2) & Compliance under the Cost Accounting Standards Board (CASB), retained(prior A-21, C14) • Threshold raised from $25M to $50M • Added: University proposed change must be submitted to DCA/ONR 6 months in advance • IMPACT • --Reduce administrative burden? • Change in effect next FY unless hear from DCA/ONR

  12. OMB Changes – 10% Rate for First-timers • Addition of 10% de-minimus indirect cost rate (modified total direct cost basis) for entities that do not currently have a negotiated rate • Subpart E, 200.414 • IMPACT • GREAT! • --May reduce the need for university staff to review indirect proposals from these type sub awardees / subcontractors

  13. OMB Changes – Cost Sharing • Affirm that Voluntary Committed Cost Sharingis NOT expected & is NOT to be used as a factor in review of applications • Subpart D, 200.306 • Onlymandatory cost sharing and cost sharing specifically committedin the projectbudgetmust be included in the organized research base • IMPACT • GREAT! • --Probably reduce administrative burden and/or Organized Research “base” • --VUCS clarification still in effect

  14. OMB Changes – Direct Charging of Admin. • Salaries of administrative staff may be direct chargedto federal grants where ALL of the following are met: • Services are integral to the project • Individuals can be specifically identified to the project • Explicitly included in the budget or have prior written approval • AND, are not recovered as indirect costs • Subchapter E, 200.413 • IMPACT • DOUBLE-EDGED SWORD! • --May reduce confusion • --But may increase the Organized Research MTDC baseand, in turn, lower proposed rates • --As offset, F&A rates would be applied to these new direct costs, increasing F&A Dollar Recoveries

  15. OMB Changes – Rate for All Agencies • Require Federal agencies to accept negotiated indirect (F&A) cost rates, unless an exception is required by statute or regulation; and, Federal agency must notify OMB of any approved deviations • Subpart E, 200.414 • IMPACT • Regrettably, not much change • Except, OMB will now have central repository of these • For example, USDA, 8% Training grants, etc., will probably stay at reduced F&A rates

  16. OMB Changes – Effort Certification • Remove the “Examplesof Acceptable Methods for Effort Certificationfor Payroll Distribution” • Emphasis on “InternalControls” and “Performance” • prior A-21, section J10 • Subpart E, 200.430 • IMPACT • Reduces Effort Certificationburden • Allows “flexibility in how universities can meet standards” • “Final guidance does not require current PAR’s/similar documentation” • Also, FDP doing their own “Project Certification” Demo, including reviews by OIG’s

  17. OMB Changes – Rate Extension • All Non-Federal entities may apply for a one-time extension of current F&A rates for up to four years, subject to cognizant agency approval • Subpart E, 200.414 • IMPACT • May be appropriate for some universities • For others, may reduce F&Adollar Recoveries (e.g., if major new research buildings, if now eligible for UCA, or substantial decrease in base re: end of ARRA grants)

  18. OMB Changes – Computing Devices • Addition of new language which allows “Computingdevices” and associated support costs to be treated as allowable and allocable direct costs • Subpart E, 200.453 • IMPACT • DOUBLE-EDGED SWORD! • May reduce confusion • But may increase the Organized Research MTDC base and, in turn, lower proposed rates • As offset, F&A rates would be applied to these new direct costs, increasing F&A Dollar Recoveries

  19. OMB Changes – MTDC (App. III C.2) • App. III C.2. references section 200.68 where participant support costs, defined in 200.75, are listed as an exclusion to MTDC • Other items may only be excludedwhen necessary to avoid a serious inequity in distribution of indirect costs, and with the approval of the cognizant agency • IMPACT • -- Perhaps increase burden to identify new exclusion • -- Possibly deter agencies adding unfair base exclusions (e.g. genomic arrays)

  20. OMB Changes – Library Expenses (App. III B.8) • The professional employee category can include post-doctorate fellows and graduate students • The other users category can be based on a reasonable factor as determined by institutional records to account for all other users of library facilities • IMPACT • --GREAT! • --Support standard practice allocation to postdocs and grad students • --Reduce administrative burden

  21. OMB Changes – Dual Role of Students • Kept language stating“ … the dual role of students as both trainees and employees contributing to the completion of Federal awards for research must be recognized in the application of these principles.” • Subpart E, 200.400(f) • IMPACT • --GREAT! • --May have reduced F&A rates if omitted

  22. Unresolved Issues • When will revised DCA Best Practices Manualbe published? • UCA for FY14 base year F&A rate proposals? • Definition of “monitored research laboratory space” re: UCA • Format for “separate calculation proposal” for UCA • Does “one time” extension mean once in the life of the rate or once in the life of the institution • Send questions to COFAR cofar@omb.eop.gov

  23. Resources • http://www.maximus.com/our-services/education/higher-education/omb-uniform-guidance • Federal Register article: Web | PDF • 2 CFR Part 200: eCFR - Code of Federal Regulations • The OMB website includes many helpful links: • OMB Policy Statements: Uniform Grant Guidance • Crosswalkfrom Existing Guidance to Final Guidance • Crosswalkfrom Final Guidance to Existing Guidance • Cost Principles ComparisonChart • Audit Requirements Comparison Chart • Definitions ComparisonChart • Administrative Requirements ComparisonChart • COFAR

  24. Contact Us • Email: highereducationinfo@maximus.com • Telephone: 800-709-2747 • Website: http://HigherEducation.MAXIMUS.com • Facebook: MaximusHEP • Twitter: #MaximusHigherEd

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