Volunteer State Solar Initiative Recovery Act Compliance Workshop

2. Tennessee Department of Economic Community Development and Tennessee Solar Institute Volunteer State Solar Initiative Recovery Act Compliance Workshop

3. MORNING SESSION

4. AFTERNOON SESSION

5. Workshop Goals Familiarize Volunteer State Solar Initiative program partners (sub-recipients, grantees and subcontractors) with State Energy Program and Recovery Act funding requirements. Provide additional resources, guidance and technical assistance contacts for program partners. Address any project-specific questions or concerns during Q&A and �office hours� with program management.

6. Disclaimer The content of this presentation is intended solely for informational purposes only and does not carry the force of law or ensure compliance with Recovery Act requirements. Nothing in this presentation should be construed as providing a legal opinion, legal interpretation or as providing legal advice.

7. Katie Southworth Grants Program Manager Tennessee Department of Economic and Community Development Energy Policy Office 312 Rosa L. Parks Ave., 10th Floor Nashville, TN 37243 Katie.Southworth@tn.gov 1-800-342-1340 http://www.state.tn.us/ecd/CD_office_energy_policy.html Program Administration

8. Tennessee Department of Economic and Community Development What we do in the Energy Policy Office: State Energy Program E-Vehicle Project Support Energy Education Programs and Codes Training Pathway Lending Small Business Energy Loans Energy Efficiency and Conservation Block Grants State Energy-Efficient Appliance Rebate Program Tennessee Clean Energy Technology Grants Support ESF-1 Energy Emergency Planning Coordinate and participate on a number of additional energy programs in the state/ region. Operate the Energy Hotline: 1-800-342-1840.

9. What is the State Energy Program? What is the Volunteer State Solar Initiative? How is the program funded? Who are the program partners? Why should I care? Outline:

10. DOE = United States Department of Energy ECD = Tennessee Department of Economic and Community Development Energy Policy Office TSI = Tennessee Solar Institute Recovery Act / ARRA = American Recovery and Reinvestment Act of 2009 SEP = State Energy Program VSSI = Volunteer State Solar Initiative UT = University of Tennessee UTRF = University of Tennessee Research Foundation UTCIS = University of Tennessee Center for Industrial Services TRAM = Tennessee Office of Recovery Act Management ORNL = Oak Ridge National Laboratory Quick Reference Guide

11. What is the State Energy Program? The US Department of Energy�s State Energy Program provides financial and technical assistance to states through grants from the Department of Energy (It�s a federal grant). States use these grants to develop state strategies and goals and to address their energy priorities. Competitive grant solicitations for the adoption of energy efficiency/renewable energy products and technologies are issued annually based on available funding. Historically, TN has received ~$300,000 - 400,000 annually under the State Energy Program. The American Recovery and Reinvestment Act (ARRA) of 2009 dramatically increased funding to state energy offices.

12. The Recovery Act The Department of Energy received $3.1 billion in State Energy Program funding for grants to the states and U.S. territories under the Recovery Act. The purposes/ focus of the Recovery Act include: (1) Jobs and economic recovery. (2) Assist those most impacted by the recession. (3) Provide investments needed to increase economic efficiency by spurring technological advances in science and health. (4) Invest in transportation, environmental protection, and other infrastructure that will provide long-term economic benefits. (5) Stabilize State and local government budgets, in order to minimize and avoid reductions in essential services and counterproductive state and local tax increases.

14. Openness, Transparency and Accountability Congress and the White House have emphasized the importance of transparency and accountability for projects involving ARRA funding. All funds are subject to unparalleled scrutiny. ARRA funds should be tracked separately from other funds at all times. Future guidance on the reporting of ARRA funds may be released at any time and retroactively applied to SEP projects.

15. Relevant Legislation and Authority Public Law 111-5 : Recovery Act of 2009 US Department of Energy (DOE) Weatherization and Intergovernmental Program (WIP) of the Office of Energy Efficiency and Renewable Energy (EERE) Code of Federal Regulations: 10 CFR 600 and 10 CFR 420 Energy Policy and Conservation Act Energy Independence and Security Act Tennessee Office of Recovery Act Management (TRAM) Directives

16. What is the Volunteer State Solar Initiative? Funded through a DOE State Energy Program grant to ECD ($62.5 million- Recovery Act funds). Comprehensive solar energy and economic-development program to advance job creation, education, technology innovation and renewable-power production in the State. Designed to leverage existing solar base, support recent solar recruits, and attract new solar investments in the State. Aligns with Recovery Act and DOE State Energy Program mandates. 2 related projects: Tennessee Solar Institute at UT and ORNL ($29.2 M) West Tennessee Solar Farm near Brownsville ($31 M)

17. Tennessee Solar Institute The Tennessee Solar Institute (TSI) is a center of excellence between the University of Tennessee (UT) and Oak Ridge National Laboratory (ORNL). Solar Opportunity Fund: $9 M for Solar Installation Grants to speed deployment of solar energy. $14.5 M for Solar Innovation Grants to encourage solar industry growth. (Technical Assistance, Facilities & Equipment Improvements, Renewable Energy Products, Process Improvements, Technology Improvements, Workforce Development) Technical and Commercialization Assistance to Solar Industry. Workforce Development and Education Opportunities. http://solar.tennessee.edu

18. TENNESSEE SOLAR INSTITUTE

19. West Tennessee Solar Farm Located in Haywood County, TN. Off I-40. Five-megawatt 20-acre power generation facility. Not only for power generation, but also a demonstration tool for educational, research and economic development purposes. TDOT will build an Information and Welcome Center at the site for travelers along I-40 to visit. It will showcase Tennessee�s growing solar value chain.

20. $ FUNDING FLOWDOWN $

21. State�s Responsibilities Informing Sub-Recipients Ensuring Program Compliance Ensuring Fiscal Compliance Ensuring Audit Compliance

22. Questions?

23. Katie Southworth Tennessee Department of Economic Community Development Summary of Recovery Act Requirements

24. Compliance with Federal Provisions National Environmental Policy Act (NEPA) Buy American Historic Preservation Labor Standards and Jobs Reporting Financial Management Monitoring and Audits Reporting/Recordkeeping THIS IS NOT AN EXCLUSIVE LIST, READ THE STANDARD TERMS AND CONDITIONS OF YOUR GRANT AWARD FOR ADDITIONAL INFO.

25. SEP-ARRA Special Terms and Conditions Your grant award / contract is required to contain all of the ARRA ST&C �flow down� language. Similarly, your subcontracts on the project should also contain the federal and state flow down provisions. A template of ST&C is available for download on the ECD website and the TSI website.

26. National Environmental Policy Act (NEPA) of 1969 42 U.S.C. �� 4321-434 Each federal agency (i.e. US DOE) develops implementing procedures Federal agencies must analyze and disclose impacts of major actions using a: Categorical Exclusion (CE or CX); or Environmental Assessment (EA); or Environmental Impact Statement (EIS) NEPA analysis must be completed before action is taken

27. NEPA Compliance Activities under this program are subject to NEPA. SEP-ARRA funds are restricted from being used on projects that have not received proper DOE review for potential significant environmental impacts. Failure to comply with NEPA requirements puts your funding in jeopardy!

28. Funds cannot go to projects that would: (1) Threaten a violation of applicable statutory, regulatory, or permit requirements for environment, safety, and health, including requirements of DOE and/or Executive Orders; (2) Require siting and construction or major expansion of waste storage, disposal, recovery, or treatment facilities (including incinerators); (3) Disturb hazardous substances, pollutants, contaminants, or CERCLA-excluded petroleum and natural gas products that preexist in the environment such that there would be uncontrolled or unpermitted releases; or (4) Adversely affect environmentally sensitive resources. Environmentally sensitive resources include, but are not limited to: (i) Property (e.g., sites, buildings, structures, objects) of historic, archeological, or architectural significance designated by Federal, state, or local governments or property eligible for listing on the National Register of Historic Places; (ii) Federally-listed threatened or endangered species or their habitat (including critical habitat), Federally- proposed or candidate species or their habitat, or state-listed endangered or threatened species or their habitat; (iii) Wetlands regulated under the Clean Water Act (33 U.S.C. � 1344) and floodplains; (iv) Areas having a special designation such as Federally- and state-designated wilderness areas, national parks, national natural landmarks, wild and scenic rivers, state and Federal wildlife refuges, and marine sanctuaries; (v) Prime agricultural lands; (vi) Special sources of water (such as sole-source aquifers, wellhead protection areas, and other water sources that are vital in a region); and (vii) Tundra, coral reefs, or rain forests.

29. NEPA Compliance � West Tennessee Solar Farm Subject to an Environmental Assessment. DOE issued a Finding of No Significant Impact (FONSI) for that project. The final EA and related documents are available for download on the ECD website at: http://www.tn.gov/ecd/recovery/sep.html

30. NEPA Compliance � Tennessee Solar Institute Grants Make sure that the scope of the grant project activities fits within the Bounded Categories of Activities. Report any proposed changes in scope ahead of time. Check and monitor whether any �Exceptional Circumstances�, cumulative impacts or connected actions that may cause significant environmental impacts apply to your project. If they do, notify your contract manager or project manager immediately. Fill out your Environmental Assurances and Waste Management planning paperwork. If your project falls outside of the Bounded Categories of activities, or involves any Exceptional Circumstances, cumulative impacts or connected actions, you are required to submit an EF-1 form for DOE review. In these instances, the State will withhold funding for the Project until DOE completes NEPA review for the Project.

31. NEPA: Bounded Categories of Activities Routine business actions Technical Advice and Planning Assistance Routine Maintenance/ custodial services Transfer, disposition, or acquisition of uncontaminated structures or equipment, environmental quality maintained. Relocation and operation of machinery- similar use Facility safety and environmental improvements, replacement or upgrade of facility components- no change in useful life. Actions to conserve energy- no change in indoor air quality

32. NEPA: Bounded Categories of Activities Funding energy efficiency retrofits: Installation of insulation; Installation of energy efficient lighting; HVAC upgrades; Weather sealing; Purchase and installation of ENERGY STAR appliances; Replacement of windows and doors; High efficiency shower/faucet upgrades; and Installation of solar powered appliances with improved efficiency.

33. Development, implementation, and installation of onsite renewable energy technology that generates electricity from renewable resources. Projects Limited To: Solar Electricity/Photovoltaic - appropriately sized system or unit on existing rooftops and parking shade structures; or a 60 KW system or smaller unit installed on the ground within the boundaries of an existing facility. Wind Turbine - 20 KW or smaller. Solar Thermal - system must be 20 KW or smaller. Solar Thermal Hot Water - appropriately sized for residences or small commercial buildings. NEPA: Bounded Categories of Activities

34. NEPA: Bounded Categories Development, implementation, and installation of onsite renewable energy technology that generates electricity from renewable resources (continued): Projects Limited To: Ground Source Heat Pump - 5.5 tons of capacity or smaller, horizontal/vertical, ground, closed-loop system. Combined Heat and Power System - boilers sized appropriately for the buildings in which they are located. Biomass Thermal - 3 MMBTUs per hour or smaller system with appropriate Best Available Control Technologies (BACT) installed and operated.

35. NEPA: Bounded Categories Development, implementation and installation of energy efficient or renewable energy-powered emergency systems (lighting, cooling, heat, shelter) installed in existing buildings and facilities. Installation of alternative fueling pumps and systems (but not storage tanks) installed on existing facilities (other than large biorefinery); purchase of alternative fuel vehicles. Development and implementation of training programs. Development and implementation of building codes and inspection services, and associated training and enforcement of such codes in order to support code compliance and promote building energy efficiency.

36. NEPA: Bounded Categories Implementing financial incentive programs such as rebates and energy savings performance contracts for existing facilities or for energy efficient equipment, provided that the incentives are not so large that they would be deemed to be grants that create projects that would not otherwise exist. Solar Innovation Grants for facilities and equipment improvements are PROHIBITED on new or expanded facilities. Facilities and Equipment grants must be for EXISTING FACILITIES. Also, Solar Innovation Grants for process improvements in new or expanded facilities are PROHIBITED. Process improvement grants are limited to projects at existing facilities.

37. NEPA: Exceptional Circumstances Notify your contract manager prior to starting work on your project if your project would use, disturb, or produce any chemicals or biological substances (i.e. pesticides, industrial process, fuels, lubricants, bacteria). Notify your contract manager if your project will involve any of the following: Polychlorinated Biphenyls (PCBs) Import, Manufacture, or Processing of Toxic Substances Chemical Storage, Use and Disposal Pesticide Use

38. NEPA: Exceptional Circumstances Hazardous, Toxic, or Criteria Pollutant Air Emissions Liquid Effluent Underground Extraction/ Injection (hazardous substances) Hazardous Waste Underground Storage Tanks Biological Materials. Indicate if genetically altered materials are involved. Removal of asbestos Disturb pre-existing hazardous contamination at the project site. Is located or will have an effect on Areas with Special Designation (e.g. National Forests, Parks, Trails)

39. Is located in floodplains Will effect special sources of groundwater (e.g. sole source aquifer) Involves archeological/ cultural resources Will effect the use of prime, unique or important farmland Involves underground extraction or injection Is located on wetlands or coastal zones There are any public issues or concerns with the project

40. If your project will cause a lot of noise Will deplete non-renewable resources Will emit criteria pollutants (Sox, Nox, etc.) Is an �eye sore� or has other potential aesthetic issues Would require or produce any radiological materials. Clearing or excavation greater than one acre New or modified Federal/ State environmental permits and/ or Requests for an Exemption NEPA: Exceptional Circumstances

41. Environmental Assurances and Waste Stream Planning Grantees must provide waste management plans addressing waste generated by each proposed Project: Describes the plan to dispose of any sanitary or hazardous waste (e.g., construction and demolition debris, old light bulbs, lead ballasts, lead paint, piping, roofing material, discarded equipment, debris, and asbestos) generated as a result of the proposed Project. Grantee shall ensure that the Project complies with all Federal, state and local regulations for waste disposal. Grantees are responsible for obtaining all necessary environmental permits for their project(s). Check out TDEC�s environmental permitting handbook for additional information: http://www.tn.gov/environment/permits/

42. BUY AMERICAN �None of the funds appropriated for or otherwise made available by the Recovery Act may be used for a project for the construction, alteration, maintenance, or repair of a public building or public work unless- All of the iron, steel, and manufactured goods used in the project are produced or manufactured in the United States.� (2 CFR 176.70)

43. BUY AMERICAN Section 1605 of ARRA 2 CFR 176 � Government Wide Guidance All iron, steel and manufactured goods must be produced or manufactured in the United States. Applicable to public buildings or public work projects only Does not apply to solar installation grants and solar innovation grants.

44. Buy American: Exemptions Non- availability (not produced or manufactured in sufficient and reasonably available quantities of a satisfactory quality) Unreasonable cost (will increase cost of the overall project by more than 25%) Inconsistent with the public interest There is specific guidance from DOE concerning the energy efficiency and renewable energy sector. If you have specific questions please contact your grant manager. Exemptions are applied for through the Energy Policy Office.

45. Buy American Records What records are needed to document compliance with the Buy American provisions? sub-recipients are required to flow down the Buy American requirements to sub-recipients, and in any sub-awards or subcontracts. Contractors and vendors should be held responsible for complying with the Buy American provisions. The State, Sub-recipients, and sub-awardees may ask vendors for contractors and letters of certification and additional documentation. State and local governments and tribes must follow their own procurement policies and procedures, per 10 CFR 600.236, �Procurement�, and are expected to maintain maximum oversight over their project and procurement activities with regards to Buy American compliance. Recipients should maintain documentation at a level they feel is appropriate to show compliance with the Recovery Act Buy American provisions A list of recommended documentation is outlined in the Guidance. Includes: �other reasonable documentation per the discretion of the state, local, or tribal government financial assistance recipient demonstrating compliance with the Buy American provisions.

46. Historic Preservation Prior to the expenditure of funds to alter any structure or site, grantees are required to comply with Section 106 of the NHPA. Section 106 applies to historic properties or sites that are listed on or eligible for listing on the National Register of Historic Places. In order to fulfill the requirements of Section 106, grantees must contact TSI to coordinate the Section 106 review as set for in 36 CFR 800. The regulations are published in the Code of Federal Regulations at 36 CFR Part 800, �Protecting Historic Properties� If the structure or site is 50 years or older then the NHPA may take effect and the grant recipient should research the site. Also, if a project involves �significant ground disturbance� it may need additional review (example: geothermal systems).

47. Historic Preservation ECD executed a Programmatic Agreement (PA) with the State Historic Preservation Officer (SHPO) for expedited s 106 review. Please see the PA and SHPO power point presentation on the ECD website or the TSI website for additional details. S 106 Review requests are made through the energy office. ECD provided a SHPO Power Point and checklist criteria for TSI to use in their review process.

48. National Register of Historic Places

49. Historic Preservation : West Tennessee Solar Farm ECD submitted archaeological assessments and related documentation for s 106 review to state SHPO. Received a determination that the project would not adversely impact historic or cultural resources.

50. Historic Preservation: TSI Grants Read the Programmatic Agreement attached to the grant agreement Review the power point for S 106 compliance provided by the State Historic Preservation Officer. Complete the S 106 Checklist. If your building or site is 50 years old or more, indicate any exemptions that may apply to your project. If your project will involve significant ground disturbance (digging wells or installing geothermal, etc.), submit a brief project description for review. Submit any necessary documentation to for review by the SHPO.

51. Davis Bacon Act Section 1606 of ARRA Applies to federally-funded construction contracts over $2,000 Both public and non-public projects funded in whole or in part with federal funds Flow-down provisions

52. Tracking and Reporting Progress Jobs Reporting Performance Reporting Department of Energy Impact Metrics DB records- 3 years Grant records- 5 years Property Inventory, Certification and Close-out

53. Performance Reports Sub-recipients are required to report monthly on (non-exclusive list): The project progress Work performed Problems encountered Problems resolved Schedule Updates, and Proposed work for the next reporting period Budget Update Subcontractor list � among other criteria.

54. Performance Reports Sub-recipients are required to report monthly on (non-exclusive list continued): GHG emissions offset Energy Generated/ Energy Saved Energy Cost Savings # of Energy Audits Conducted Number of workshops held and workers trained Installed Renewable Capacity � among other Energy-related performance metrics tailored to particular projects.

55. Jobs Reporting Reporting of hours worked on your ARRA-funded projects is required. All sub-recipients, grantees and subcontractors doing work directly on the ARRA-funded project must report hours worked on project (both federally- funded hours and hours funded through cost-share on project). Jobs Reports are not the same as Davis Bacon reports. Jobs reports include all employee hours (not limited to labor employee hours- includes clerical, legal managerial, etc.). You will be provided jobs reporting forms to use for reporting purposes on your project (also available for download on ECD/ TSI websites).

56. Jobs reporting forms are tailored to your project. Grantees are responsible for obtaining all jobs forms from their subcontractors working on a project and submitting them in a timely fashion.

57. Property Reports/ Inventory Title. Title to equipment acquired by a non-Federal entity with Federal awards vests with the non-Federal entity. However, the purchase and use of non-expendable personal property or equipment is subject to DOE/ the State of Tennessee laws and regulations. Equipment is defined as tangible, non-expendable property, including exempt property, charged directly to the award having a useful life of more than one year and an acquisition cost of $5,000 or more per unit.

58. Property Reports/ Inventory The State shall use, manage and dispose of equipment acquired under a Federal grant in accordance with State laws and procedures. Sub-recipients of States who are Institutions of higher education (i.e. University of Tennessee) shall follow the provisions of OMB Circular A-110.

59. Property Reports/ Inventory Basically, OMB Circular A-110 requires that equipment be used in the program for which it was acquired or, when appropriate, other Federal programs. Equipment records shall be maintained, a physical inventory of equipment shall be taken at least once every two years and reconciled to the equipment records, an appropriate control system shall be used to safeguard equipment, and equipment shall be adequately maintained.

60. Property Reports/ Inventory As a result of these requirements, in those instances where the equipment is purchased with ARRA funds in whole or in part: A Property Reporting Form must be filed along with Payment Request Forms or Monthly Reporting forms (depending on the project) when these costs are documented for reimbursement or match. Sub-recipients and Grantees must complete and sign the Form and may be required to provide any other necessary information to the DOE, the State, UT, or UTRF (as appropriate).

61. Property Reports/ Inventory List equipment and non-expendable personal property (includes excess supplies at the end of the grant) costing $5,000 or more. Reports must provide: Description of property Serial number and Cost Where it is located Property Control Number UT will use an assigned Property Control Number to track its inventory (this will be provided by the State, UT or UTRF, as appropriate). Sub-recipients must conduct periodic inventories of property purchased through SEP-ARRA funds.

62. On-Time Performance/ Timeliness �Shovel Ready� projects Project delays can have a financial impact: Loss of funding for existing project if delayed too long; Possible reduction in funding to the State. Implement the activity as planned Contract penalties for non-performance

63. Managing program activities is critical No timeliness if work cannot proceed as a result of failure to plan ahead Issues before grant award Staffing Issues after grant award Engineering design delays Permitting delays Local government/ utility issues Budget Issues Selecting subcontractors/ procurement delays

64. Best Practices Work with responsible contractors possessing the ability to perform successfully under the terms and conditions of your grant contract. You will want to consider: contractor integrity, compliance with public policy, record of past performance, and financial and technical resources.

65. Awards to suspended and debarred parties are prohibited. Grantees and sub-grantees must not make any award or permit any award (sub-grant or contract) at any tier to any party which is debarred or suspended or is otherwise excluded from or ineligible for participation in Federal assistance programs under Executive Order 12549, �Debarment and Suspension.�

66. Other Provisions Employment of Unauthorized Aliens The employment of unauthorized aliens by any Grantee/vendor is considered a violation of Section 274A(e) of the Immigration and Nationality Act

67. Other Provisions Discrimination Prohibited Title VI policy requirement. No person on the grounds of disability, age, race, color, religion, sex, national origin, veteran status or any other classification protected by Federal and/or Tennessee State constitutional and/or statutory law shall be excluded from participation in, or be denied benefits of, or be otherwise subjected to discrimination under this program.

68. Other Provisions Lobbying Restrictions By accepting funds under this award, you agree that none of the funds obligated on the award shall be expended, directly or indirectly, to influence congressional action on any legislation or appropriation matters pending before Congress, other than to communicate to Members of Congress as described in 18 U.S.C. 1913. This restriction is in addition to those prescribed elsewhere in statute and regulation.

69. Other Provisions: Required Disclaimer For press releases and similar publications on projects supported by these funds: Acknowledgment:� "This material is based upon work supported by the Department of Energy under Award Number DE-EE0000160� For scientific or technical publications produced using these funds: Disclaimer:� "This report was prepared as an account of work sponsored by an agency of the United States Government.� Neither the United States Government nor any agency thereof, nor any of their employees, makes any warranty, express or implied, or assumes any legal liability or responsibility for the accuracy, completeness, or usefulness of any information, apparatus, product, or process disclosed, or represents that its use would not infringe privately owned rights.� Reference herein to any specific commercial product, process, or service by trade name, trademark, manufacturer, or otherwise does not necessarily constitute or imply its endorsement, recommendation, or favoring by the United States Government or any agency thereof.� The views and opinions of authors expressed herein do not necessarily state or reflect those of the United States Government or any agency thereof." Funding Source: CDFA 81.041

70. The final thought is: No Reports = No Payments If you want to be paid you need to submit complete, accurate and detailed reports. Questions?

71. Katie Southworth Tennessee Department of Economic Community Development Financial Management and Recordkeeping

72. It�s your responsibility� Financial management and control of grant funds is the sole responsibility of the Sub-recipient, Grantee, or Subcontractor that accepts the funds.

73. Best Practices: Financial Management Systems Must be Sufficient to: Permit preparation of reports as required by the grant agreement, and Permit the tracing of funds to a level of expenditure adequate to establish that grant funds have not been used in violation of the restrictions or prohibitions of the grant agreement.

74. Necessary Components of a Financial Management System General Ledger Cash Receipts Journal Cash Disbursements Journal Detail of Expenditures

75. Best Practices: Budget Control Must compare actual expenditures to budgeted amounts for each budget line-item. All costs must be directly related to specific project deliverables. Requests to modify a project budget should be submitted and approved before incurring any of the related project costs to ensure that those costs are eligible for reimbursement with grant funds. For direct Sub-recipients (UT)- Any Program Generated Income (or PGI), that is income that is generated as a result of grant funded activities, must be included in an approved project budget and expended solely on allowable grant activities. If you anticipate generating any PGI, contact your Grant Manager for direction.

76. Example: Innovation Grants �(b) Prior to Project Completion, upon achievement of each milestone specified in the Milestone Payment Schedule, Grantee shall deliver to Grantor via email: (i) an Application for Payment in the form prescribed by Grantor; (ii) a progress report in the form prescribed by Grantor describing the work accomplished on the Project; (iii) all back-up documentation required by the Agreement or reasonably requested by the Grantor supporting achievement of the milestone, including without limitation proof-of-purchase for all equipment, and contractor or consultation invoices; and (iv) summary of actual expenses incurred for the Project through the specified milestone.�

77. Allowable Costs

78. Travel Costs UT and UTRF- travel costs in compliance with State and University travel policies as described in: http://www.tn.gov/finance/act/travel.html (state contractors are subject to travel costs as described in their contract with the state). Travel costs must be directly related to project deliverables; Accompanied by proper travel forms and receipts.

79. The Sub-Recipient�s Financial Management System is Required to Maintain: An accurate, current, and complete disclosure of the status and financial results of the grant program in accordance with the grant agreement. Records that adequately identify (by activity) the source and use of funds for each grant-supported project. Effective control and accountability for all grant funds, property, and other assets. Procedures to comply with the requirement for the timely distribution of funds. Accounting records that are supported by source documentation. Internal controls and segregation of duties designed to eliminate fraud and abuse.

80. Open Competition, Conflicts of Interest and Fair Dealing Arms length transactions� No �outside dealing� Full disclosure of potential conflicts of interest. A third tier contractor/vendor cannot assist the sub-recipient with a procurement that the third tier contractor/vendor will bid on. Report all subcontracts entered into under program.

81. Potential Noncompetitive Business Practices Placing unreasonable requirements on firms in order for them to qualify to do business Requiring unnecessary experience and excessive bonding Noncompetitive pricing practices between firms or between affiliated companies Noncompetitive awards to consultants that are on retainer contracts Organizational conflicts of interest Specifying only a brand name product instead of allowing an equal product to be offered and describing the performance of other relevant requirements of the procurement, and Any arbitrary action in a procurement process.

82. Free and Open Competition Information relating to the selection of subcontractors and vendors under the award should be maintained in records and provided upon request. Grantees must maintain records relating to procurement, solicitations, independent cost estimates and selection of contractors.

83. Katie Southworth Tennessee Department of Economic Community Development State and DOE Monitoring

84. Reporting and Monitoring

85. The University of Tennessee and lower-tier contractors (signatories to grant agreements/ subcontracts) are responsible for compliance with the terms and conditions of the grant agreement. The Energy Office will focus initial monitoring efforts on the Sub-recipients UT and UTRF, but will also monitor lower tier grantees and subcontractors. The Sub-recipient is responsible for ensuring that all 3rd Tier Sub-recipients, grantees and contractors adhere to the terms and conditions of the grant agreement.

87. Two major types of monitoring: 1. Desk review Completed by grant managers monthly 2. Onsite monitoring Completed by grant managers on a schedule determined by an Initial Risk Assessment

88. Desk Review ECD Grant Managers analyze Progress Reports provided by UT/ UTRF (monthly and quarterly) Accomplishments Anticipated delays Metrics (number of audits and retrofits, jobs created, energy savings etc.) Expenditures/ Budgets

89. On-site monitoring Site Visits Initial Risk Assessment dictates the ECD on-site monitoring schedule Funding amount, type of project etc. Site visits will be conducted by Energy Office Staff and may also include DOE staff All site visits will be coordinated with sub-recipients and grantees. Sub-recipients and/ or lower tier contractors must have dedicated staff on-site during monitoring visits

90. Five areas of accountability and compliance evaluated: Financial e.g. Is there an accounting system? Are there controls for mitigating fraud, waste, and abuse? Procurement e.g. Is the Grantee following Federal, State and Local procurement standards? Is there a clear process for determining the use and selection of sub-contractors/vendors? Keeping an eye out for organizational conflicts of interest as well as noncompetitive practices among contractors that may restrict or eliminate competition or otherwise restrain trade Property Management e.g. Does the Sub-recipient maintain a system of internal controls that provides reasonable assurance against loss, theft, damage, or unauthorized use of equipment? Labor Standards e.g. What is the wage decision? Is the recipient/ sub-recipient/ subcontractor aware of which labor and wage requirements apply to their activities? Program Administration

91. Corrective Actions If findings are identified during on-site monitoring, the Monitoring Report will show observed findings: Corrective Action Plan The Corrective Action Plan must convey a strategy, with a timeline, to remediate any findings

92. Records Retention

93. Records Retention Grantees should retain sufficient records (reports, pictures, financial records, correspondence) demonstrating its compliance with the terms of funding for a period of five years and should allow access to such records upon request by ECD or its designee.

94. DOE�s Recovery Act Monitoring Plan for SEP is available for download at: http://www1.eere.energy.gov/wip/pdfs/monitor_plan_june2010.pdf The DOE Compliance Checklist for SEP is available for download at: http://www1.eere.energy.gov/wip/pdfs/appendix_compliance_checklists_050710.pdf

95. Tennessee Department of Economic Community Development Resources

96. Your Contract Manager/ Project Manager Tara Halstead, Solar Innovation Grantees Brandon Herriage, Solar Installation Grantees Paula Flowers, West TN Solar Farm Project Manager at UTRF Jean Peretz, Director of Operations at TSI John Sanseverino, Director of Programs at TSI Stacey Patterson, University of Tennessee Ryan Gooch, Energy Policy Office Director ECD

97. University of Tennessee Center for Industrial Services (UT CIS) Earl Pomeroy Chris Wright Lynn Reed Russell Toone http://www.cis.tennessee.edu/

98. Department of Energy Technical Assistance Website Department of Energy Technical Assistance Website The Solution Center Webcasts Best Practices Submit questions Blog http://www1.eere.energy.gov/wip/solutioncenter/

99. OMB Circulars White House Office of Management and Budget http://www.whitehouse.gov/omb/circulars_default

100. Code of Federal Regulations http://www.gpoaccess.gov/cfr/ 10 CFR 420 applies to State Energy Program 10 CFR 600- federal financial regs

101. Limitation on use of funds� For each kind of organization, there is a set of Federal principles for determining allowable costs. Allowable costs will be determined in accordance with the cost principles applicable to the organization incurring the costs. The following chart lists the kinds of organizations and the applicable cost principles.

102. Allowable Costs

103. Tennessee Statutes http://www.michie.com/tennessee/lpext.dll?f=templates&fn=main-h.htm&cp=tncode (free and online). Sub-recipients, contractors and grantees are responsible for complying with all state and local requirements. Grantees are responsible for obtaining any and all necessary permits, permissions, etc.

104. DOE State Energy Program info General program information on the Department of Energy�s State Energy Program may be found at the Energy Efficiency and Renewable Energy (EERE) website: http://www.eere.energy.gov/ Both general and SEP-specific DOE Program Guidance can be found at the following pages: 1.) http://www1.eere.energy.gov/wip/guidance.html#sep ; and 2.) http://www1.eere.energy.gov/wip/sep.html DOE Program Guidance is provided by Topic Area on the EERE website: Recovery Act Monitoring and Reporting Guidance http://www1.eere.energy.gov/wip/recovery_act_guidance.html Benefits and Job Creation from the Recovery Act http://www1.eere.energy.gov/wip/guidance.html#recovery Buy American http://www1.eere.energy.gov/recovery/buy_american_provision.html Davis-Bacon Act http://www1.eere.energy.gov/wip/davis-bacon_act.html. NEPA/ Wastestream Management http://www1.eere.energy.gov/wip/nepa_guidance.html Use of Recovery Act Logos on Signage http://www1.eere.energy.gov/wip/guidance.html#signage

105. Additional Useful Websites Tennessee Solar Institute website ECD Energy Policy Office SEP-ARRA website. Tennessee Recovery Act Management Department of Energy Recovery Act Guidance website. Department of Energy General Counsel Hotline (GC hotline).

106. If you see something, say something!!!

107. Tennessee Comptroller of the Treasury Fraud, Waste and Abuse Hotline Report fraud, waste and abuse on ARRA programs to the TN Comptroller�s Office. Fraud, Waste& Abuse Hotline1-800-232-5454 http://www.comptroller1.state.tn.us/shared/arra.asp

108. Recovery Accountability and Transparency Board Submit a fraud, waste, and abuse�Complaint Form�online Call the toll-free Fraud Hotline number at 1-877-FWA-DESK (1-877-392-3375) Fax the toll-free fax number at 1-877-FAX-FWA2 (1-877-329-3922) Write the Recovery Accountability and Transparency Board at:P.O. Box 27545Washington, D.C. 20038-7958(Attention: Hotline Operators)

109. ACKNOWLEDGEMENT and DISCLAIMER Acknowledgment:� "This material is based upon work supported by the Department of Energy under Award Number DE-EE0000160"Disclaimer:� "This report was prepared as an account of work sponsored by an agency of the United States Government.� Neither the United States Government nor any agency thereof, nor any of their employees, makes any warranty, express or implied, or assumes any legal liability or responsibility for the accuracy, completeness, or usefulness of any information, apparatus, product, or process disclosed, or represents that its use would not infringe privately owned rights.� Reference herein to any specific commercial product, process, or service by trade name, trademark, manufacturer, or otherwise does not necessarily constitute or imply its endorsement, recommendation, or favoring by the United States Government or any agency thereof.� The views and opinions of authors expressed herein do not necessarily state or reflect those of the United States Government or any agency thereof.� Funding Source: CDFA 81.041

110. THANK YOU!