The August 13, 2020 issue of the Federal Register included the final guidance for the revision of 2 CFR 200, Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards (Uniform Guidance). All revisions except amendments to two sections are effective November 12, 2020; two sections became effective on the date of publication in the Federal Register. Federal agencies are likely in the process of implementing these changes.
Many recipients of Federal grants and cooperative agreements anxiously awaited these revisions. Now, the final guidance is available and, for those who want to review exactly what changes were made, the redlined version, along with Office of Management and Budget (OMB) feedback to public comments is also online.
As Grants Works described in a previous post, Uniform Guidance (2 CFR 200) is the culmination of extensive collaboration between the OMB and federal awarding agencies to improve the transparency, oversight, and performance of federal awards to non-federal entities.
When OMB released the final draft of Uniform Guidance in December 2014, it drastically streamlined how grants and cooperative agreements were managed.
Prior to Uniform Guidance, grant recipients of all stripes seeking to remain compliant referred to one or more of eight separate OMB Circulars in addition to comparing OMB guidance with agency-specific requirements and the award terms and conditions.
After Uniform Guidance was published, the eight OMB Circulars were integrated, streamlined, and repackaged into the singular guidance. In addition, a number of federal agencies either adopted it in its entirety or supplemented it with agency-specific guidelines (e.g. NASA’s 2 CFR 1800 or HHS 45 CFR 75).
Uniform Guidance – The 2020 Edition
The revisions released on August 13, 2020, align with four strategies to “maximize the value of grant funding,” emphasize a risk-based, data-driven infrastructure, and balance compliance with successful utilization of federal financial assistance.
The four guiding strategies are: (1) Operationalize the Grants Management Standards, (2) Establish a Robust Marketplace of Modern Solutions, (3) Manage Risk, and (4) Achieve Program Goals and Objectives.
Grants Works has pored through the revisions and the imprint of strategies 1 and 2 are clear in guidance that stresses the modernization of recipient reporting and the use of data standards and technology-based solutions to better manage data.
Adherence to strategies 3 and 4 are clearly seen in guidelines that “strengthen the governmentwide approach to performance and risk” by encouraging agencies to measure recipient performance and help agencies and non-federal entities improve program goals and objectives.
Grants Works plans to publish follow-up posts that will closely evaluate some of the changes in Uniform Guidance and what they mean for recipients of federal grants and cooperative agreements.
We can point out a few here that some may find particularly interesting.
- 200.414 – Indirect (F&A) costs – OMB allows for an expanded use of the de minimis rate for all non-federal entities with some exceptions.
- 200.202 – Program planning and design – Reinforces the importance of results-based grantmaking and having a strong program plan and design.
- 200.301 – Performance measurement – Federal agencies are now required to include mission-aligned program goals, objectives, and indicators in solicitations and award documents. Further to this point, the words “should” and “may” were replaced in many instances with “must.” Those of us in the federal grant management space may chuckle at this funny but important distinction.
Other Important Changes to Note
- Sections 200.216 – Prohibition on certain telecommunication and video surveillance services or equipment and 200.340 – Termination is effective August 13, 2020.
- The revisions supported the implementation of several recent laws—the Grants Reporting Efficiency and Agreements Transparency Act (the GREAT Act), the Digital Accountability and Transparency Act (the DATA Act), several National Defense Authorization Acts (NDAAs), and the Federal Funding Accountability and Transparency Act (FFATA). Read Grants Works’ summary of the Great Act here.
- 2 CFR 25 – Universal Identifier and System for Award Management and 2 CFR 170 – Reporting Subaward and Executive Compensation Information were also revised.
- OMB also added 2 CFR 183 – Never Contract With the Enemy to implement this Part. Federal agencies may add award terms from Part 183 in awards that exceed $50,000, that are performed outside the U.S. and meet other conditions.
You can access the fully revised Uniform Guidance in the Federal Register.