Transcript How All The Pieces - Brustein & Manasevit

How All The Pieces
Now Fit Together in
the Entirety of EDGAR
Presented by
Michael Brustein, Esq.
[email protected]
Brustein & Manasevit, PLLC
Spring Forum 2015
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What Regulations Apply to My Grants?
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1. 34 CFR Part 75 (Direct Grant Program)
2. 34 CFR Part 76 (State-Administered Programs)
3. 34 CFR Part 77 (Definitions that Apply to
Department Regulations)
4. 34 CFR Part 79 (Intergovernmental Review of
Department of Education Programs and
Activities)
5. 34 CFR Part 81 (General Education Provisions
Act – Enforcement)
6. 34 CFR Part 82 (New Restrictions on Lobbying)
7. 34 CFR Part 84 (Governmentwide
Requirements for Drug-Free Workplace
(Financial Assistance))
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8. 34 CFR Part 86 (Drug and Alcohol Abuse
Prevention)
9. 34 CFR Part 97 (Protection of Human Subjects)
10. 34 CFR Part 98 (Student Rights in Research,
Experimental Programs, and Testing)
11. 34 CFR Part 99 (Family Educational Rights and
Privacy)
12. 2 CFR Part 180 (OMB Guidelines to Agencies on
Governmentwide Debarment and Suspension
(Nonprocurement)), as adopted at 2 CFR Part 3485
13. 2 CFR Part 200 (Uniform Administrative
Requirements, Cost Principles, and Audit
Requirements for Federal Awards), as adopted at 2
CFR Part 3474
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A grant agreement (legal instrument of
financial assistance) to enter into a
relationship the principal purpose of
which is to transfer anything of value
from the federal awarding agency to the
non-federal entity to carry out a public
purpose authorized by law.
2 C.F.R. § 200.51
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Note distinction between a “grant” and a
“contract”.
VS
GRANT
“Grants” are subject to applicable federal
requirements.
“Contracts” are not subject to federal
compliance.
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2 C.F.R. § 200.330
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What if the grantee fails to comply with
the applicable federal requirements?
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Pennhurst vs. Halderman, 451 U.S. 1 (1981)
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Congress may fix the terms on which it
disburses grants.
A federal grant “is much in the nature of a
contract,” in return for the federal funds
the grantee agrees to comply with the
federally imposed conditions.
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Bell v. New Jersey and Pennsylvania,
461 U.S. 773 (1983)
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But New Jersey and Pennsylvania argued
to the Supreme Court that USDE cannot
recover misspent grant funds
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Federal auditors determined both states
misspent Title I funds.
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Supreme Court
grantees misusing
federal funds incur a debt to the Federal
Government (citing Section 415 of GEPA)
grants must be adjusted on account
of overpayments.
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Citing Pennhurst
grantee chose to
participate in the program, and as a
condition of receiving the grant, gave an
assurance that it would abide by the
conditions of the grant.
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Many of the conditions of the grant are
included in GEPA and EDGAR.
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Prior to 1970 (HEW) (USOE)
Administrative, Cost and Audit rules were
included as part of program regulations.
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The Education Amendments of 1970 (Pub
Law 91-230) (Section 401) brought
general provisions of prior laws into single
title: “The General Education Provisions
Act (GEPA)”.
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Between 1965
1972 U.S.O.E. very
broadly interpreted federal statues.
Congress questioned legal authority of
some of the federal regulations.
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Education Amendments of 1972 –
“Section 503 Study”
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First EDGAR
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Lead to the “General Provisions for Office
of Education Programs”
November 6, 1973
38 FR 30661
45 C.F.R. Part 100
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EDGAR incorporated by reference “OMB
Circulars”
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“The Circular series is used when the
nature of the subject matter is of
continuing effect.”
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 Circular A-1 (August 7, 1952), Bureau of the
Budget
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OMB 1970
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Bureau of Budget
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Circular A-87 – Cost Principles
First Issued
1968
Revised
1995
Repealed
2014
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Cost Principles are now in 2 C.F.R. Part
200, Subpart E.
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Audit
Principles
1978 - Congress enacts Inspector General
Act
Prior to 1979, each federal agency
developed own audit rules and policies
In 1979, OMB issued Attachment P to
OMB Circular A-102 (Administrative
Rules)
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Program statutes often imposed federal
audit requirements (e.g. The VEA
Amendments of 1976).
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1979 – Congress enacts Department of
Education Organization Act
1980 – USDE opens for business
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1980 EDGAR Parts 74, 75, 76, 80 moved
to Title 34 of the C.F.R.
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1984 – Single Audit Act
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 OMB issues Circular A-133 to cover state /
local grantees expending over $25,000.
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$
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1996 – Single Audit Amendment to cover
IHEs, Non-profits
Threshold increased to $300,0000
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1996 – First OMB Compliance
Supplement Issued
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New EDGAR
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Repeals A-133, A-21, A-87, A-102, A-110,
A-122
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 Title 34
 Title 2
 Part 200 – Cost/Administrative/Audit Rules
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Key Parts of
EDGAR
 Part 75 – Direct Grant Programs
 Part 76 – State-Administered Programs
 Part 77 – Definitions
 Part 81 – Enforcement
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Effective dates
for 2 C.F.R.
Part 200
December 26, 2014 – Direct Grants from ED
July 1, 2015 – State Administered Programs
July 1, 2016 – Procurement Rules – One Year
Grace Period
Indirect Cost Rates When Due For
Renegotiation
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ED Adopts OMB “Guidance” in 2
C.F.R. Part 200 except for:
1) 2 C.F.R. § 200.102(a)
2) 2 C.F.R. § 200.207(a)
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Adoption of 2
C.F.R. Part 200
79 Federal
Register
76091
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“Exception” to
2 C.F.R. §
200.102(a)
Authority for granting exceptions to
regulations vested in OMB.
But “Department of Education
Organization Act” 20 U.S.C. § 3472 does
not permit Secretary to delegate
“exceptions” to OMB. Secretary will
consult within OMB.
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The Secretary retains the authority under
sections 74.14 and 80.12 to impose high
risk conditions on individual grants and
individual grantees at time award is made
or after an award is made.
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“Clarification”
to 2 C.F.R. §
200.207
“High Risk
Status”
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State-Administered Programs
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Roadmap of Part 76
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76.1 / 76.50 / 76.51
Program statute authorizes fund allocation to
States by formulas.
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Programs to
Which Part 76
Applies
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State allocates funds by formula (Title I,
IDEA-B, Perkins) or Competitively (AEFLA,
21st Century).
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76.101
 Meets requirements of Section 441 of GEPA.
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The General
State
Application
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76.301
 Meets requirements of Section 442 of GEPA.
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LEA Local
Application
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76.401
 Due Process and State Agency Hearing
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Disapproval of
an Application
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 76.530
 The general principles to be used in determining
costs applicable to grants is in 2 C.F.R. Part 200,
Subpart E.
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Allowable
Costs
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Indirect Cost
Rates
76.560
76.569
79 FR 76094.
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Incorporates language from 2 C.F.R. Part 200,
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76.700
76.702
 Incorporates 2 C.F.R. Part 200, Subpart D.
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General
Administrative
Responsibilitie
s
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76.703
 If plan submitted in “Substantially
Approvable Form” funds available for
obligation on date funds available to
Secretary for obligation.
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When a State
May Begin to
Obligate
Funds
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 Note differences on obligation dates
 Adds new category
pre-agreement
costs approved by Secretary are obligated
on 1st day of grant performance period.
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When
Obligations
are Made
76.707
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76.710
 708(c) references 2 C.F.R. Part 200 on
Pre-Agreement Costs.
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Obligation
Period
76.708
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76.731
 References new reporting requirements
on financial management in 2 C.F.R. §
200.302 (performance reporting)
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Reports and
Records
76.720
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76.760
 Must comply with req. of each program
 Proper accounting
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Funds under
more than one
Program to
assist a Single
Activity
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76.770
76.783
 Goes beyond requirements of 2 C.F.R.
Part 200, Subpart D.
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Procedures to
Ensure
Compliance
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Federal
Procedures to
Assure
Compliance
76.900
No waivers, unless
specifically authorized
76.901
OALJ
76.902
Judicial Review
76.910
Cooperation with Audits
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The New 2
C.F.R. Part 200
Subpart A – Definitions
Subpart B – General Provisions
Subpart C – Pre Award Requirements
Subpart D – Post Award Requirements
Subpart E – Cost Principles
Subpart F – Audit Requirements
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 This presentation is intended solely to provide general
information and does not constitute legal advice or a
legal service. This presentation does not create a clientlawyer relationship with Brustein & Manasevit, PLLC and,
therefore, carries none of the protections under the D.C.
Rules of Professional Conduct. Attendance at this
presentation, a later review of any printed or electronic
materials, or any follow-up questions or communications
arising out of this presentation with any attorney at
Brustein & Manasevit, PLLC does not create an attorneyclient relationship with Brustein & Manasevit, PLLC. You
should not take any action based upon any information
in this presentation without first consulting legal counsel
familiar with your particular circumstances.
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