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Department of Commerce Pre-Award Notification Requirements for Grants and Cooperative Agreements
Note: EPA no longer updates this information, but it may be useful as a reference or resource.
[Federal Register: December 30, 2004 (Volume 69, Number 250)]
[Notices]
[Page 78389-78396]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr30de04-41]
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DEPARTMENT OF COMMERCE
[Docket No. 010925233-4337-03]
Department of Commerce Pre-Award Notification Requirements for
Grants and Cooperative Agreements
AGENCY: Department of Commerce (DOC).
ACTION: Notice.
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SUMMARY: This notice revises and updates the Department of Commerce
(DOC) Pre-Award Notification Requirements for Grants and Cooperative
Agreements published in the Federal Register (66 FR 49917) on October
1, 2001, as amended on October 30, 2002 (67 FR 66109), which pertain to
information provided to applicants for funding under grants and
cooperative agreements awarded by the DOC. This announcement
constitutes a recompilation of the notice with all amendments and
revisions to date.
DATES: These provisions are effective December 30, 2004.
FOR FURTHER INFORMATION CONTACT: Gary Johnson, Office of Acquisition
Management, Telephone Number--202-482-1679.
SUPPLEMENTARY INFORMATION: The DOC is authorized to award grants and
cooperative agreements under a wide
[[Page 78390]]
range of programs that support economic development; international
trade; minority businesses; standards and technology; oceanic/
atmospheric services; and telecommunications and information.
It is the policy of DOC to seek full and open competition for award
of discretionary financial assistance funds. Moreover, DOC financial
assistance must be awarded through a merit-based review and selection
process whenever possible. Notices announcing the availability of
Federal funds for each DOC competitive financial assistance program
with funds available for new awards will be published by the sponsoring
operating unit in the Federal Register and posted on the Grant.gov Web
site in the uniform format for announcements of funding opportunities
mandated by the Office of Management and Budget (OMB). These
announcements will reference or include the DOC Pre-Award Notification
Requirements identified in Sections A and B of this notice, and will
include program-specific information as identified in Section C of this
notice and will follow the uniform format for announcements of funding
opportunities as identified in Section D.
This announcement provides notice of the DOC Pre-Award Notification
Requirements that apply to all DOC sponsored grant and cooperative
agreement programs and may supplement those program announcements which
make reference to this notice. Some of the DOC general provisions
published herein contain, by reference or substance, a summary of the
pertinent statutes or regulations published in the U.S. Code (U.S.C.),
Federal Register, Code of Federal Regulations (CFR), Executive Orders
(EOs), OMB Circulars (circulars), or Assurances (Forms SF-424B, 424D).
To the extent that it is a summary, such provision is not in derogation
of, or an amendment to, any such statute, regulation, EO, circulars, or
Forms SF-424B and SF-424D.
Each individual award notice will complete and include an analysis
of the requirements in Executive Order 12866, Executive Order 13132,
the Administrative Procedure Act, the Regulatory Flexibility Act, and
the Paperwork Reduction Act, as applicable.
A. The following pre-award notice provisions will apply to all
applicants for and recipients of DOC grants and cooperative agreements:
1. Federal Policies and Procedures. Applicants, recipients and
subrecipients are subject to all Federal laws and Federal and DOC
policies, regulations, and procedures applicable to Federal financial
assistance.
2. Debarment, Suspension, Drug-Free Workplace, and Lobbying
Provisions. All applicants must comply with the requirements of Subpart
C of 15 CFR Part 26, ``Governmentwide Debarment and Suspension
(Nonprocurement),'' 15 CFR Part 29, ``Governmentwide Requirements for
Drug-Free Workplace (Financial Assistance)'' (published in the Federal
Register on November 26, 2003, 68 FR 66534), and 15 CFR Part 28, ``New
Restrictions on Lobbying,'' including the submission of required forms
and obtaining certification from lower tier applicants/bidders.
3. Pre-Award Screening of Applicant's and Recipient's Management
Capabilities, Financial Condition, and Present Responsibility. It is
the policy of DOC to make awards to applicants and recipients who are
competently managed, responsible, financially capable and committed to
achieving the objectives of the award(s) they receive. Therefore, pre-
award screening may include, but is not limited to, the following reviews:
(a) Past Performance. Unsatisfactory performance under prior
Federal awards may result in an application not being considered for
funding.
(b) Credit Checks. A credit check will be performed on individuals,
for-profit, and non-profit organizations.
(c) Delinquent Federal Debts. No award of Federal funds shall be
made to an applicant who has an outstanding delinquent Federal debt until:
(1) The delinquent account is paid in full,
(2) A negotiated repayment schedule is established and at least one
payment is received, or
(3) Other arrangements satisfactory to DOC are made.
(4) Pursuant to 31 U.S.C. 3720B, unless waived, the DOC is not
permitted to extend financial assistance in the form of a loan, loan
guarantee, or loan insurance to any person delinquent on a nontax debt
owed to a Federal agency. This prohibition does not apply to disaster
loans.
(5) Pursuant to 28 U.S.C. 3201(e), unless waived by the DOC, a
debtor who has a judgment lien against the debtor's property for a debt
to the United States shall not be eligible to receive any grant or loan
which is made, insured, guaranteed, or financed directly or indirectly
by the United States or to receive funds directly from the Federal
Government in any program, except funds to which the debtor is entitled
as beneficiary, until the judgment is paid in full or otherwise satisfied.
(d) Name Check Review. A name check review will be performed by the
OIG on key individuals associated with non-profit and for-profit
organizations, unless (1) proposed award amounts are $100,000 or less;
(2) applicants have been recipients of financial assistance from the
Department of Commerce for three or more consecutive years without any
adverse programmatic or audit finding; or (3) applicants are units of a
state or local government. Name checks are intended to reveal if any
key individuals associated with the applicant have been convicted of or
are presently facing criminal charges (e.g., fraud, theft, perjury), or
other matters which significantly reflect on the applicant's management
honesty or financial integrity. If any of the conditions listed below
in paragraphs (1), (2), or (3) occur, DOC reserves the right to take
one or more of the following actions: Consider suspension/termination
of an award immediately for cause; require the removal of any key
individual from association with management of and/or implementation of
the award; and make appropriate provisions or revisions with respect to
the method of payment and/or financial reporting requirements:
(1) A key individual fails to submit the required Form CD-346,
Applicant for Funding Assistance;
(2) A key individual makes an incorrect statement or omits a
material fact on the Form CD-346; or
(3) The name check reveals significant adverse findings that
reflect on the business integrity or responsibility of the recipient
and/or key individual.
(e) List of Parties Excluded from Procurement and Nonprocurement
Programs. The Excluded Parties Listing System (EPLS) maintained by the
General Services Administration (GSA) {Found at http://epls.arnet.gov}
that lists parties excluded from Federal procurement and
nonprocurement programs will be checked to assure that an applicant is
not debarred or suspended on a government-wide basis from receiving
financial assistance.
(f) Pre-Award Accounting System Surveys. The Grants Office, in
cooperation with the OIG when appropriate, may require a pre-award
survey of the applicant's financial management system in cases where
the recommended applicant has had no prior Federal support, the
operating unit has reason to question whether the financial management
system meets Federal financial management standards, or the applicant
is being considered for a high-risk designation.
4. No Obligation for Future Funding. If an application is selected
for funding,
[[Page 78391]]
DOC has no obligation to provide any additional future funding in
connection with that award. Amendment of an award to increase funding
or to extend the period of performance is at the total discretion of DOC.
5. Pre-Award Activities. If applicants incur any costs prior to an
award being made, they do so solely at their own risk of not being
reimbursed by the Government. Notwithstanding any verbal or written
assurance that may have been received, there is no obligation on the
part of DOC to cover preaward costs unless approved by the Grants
Officer as part of the terms when the award is made, or as authorized
for awards that support research by 15 CFR 14.25(e)(4).
6. Freedom of Information Act (FOIA) Disclosure. The FOIA, 5 U.S.C.
552 and implementing DOC regulations at 15 CFR Part 4, set forth DOC's
rules to make requested material, information, and records publicly
available. Unless prohibited by law and to the extent required under
the FOIA, contents of applications and proposals submitted by
applicants may be released in response to FOIA requests.
7. False Statements. A false statement on an application is grounds
for denial or termination of an award and grounds for possible
punishment by a fine or imprisonment as provided in 18 U.S.C. 1001.
8. Application Forms. Unless the individual programs specify
differently in their annual notice of availability of funding or in
other appropriate publications, the following forms and certifications
will be used in applying for DOC grants and cooperative agreements: OMB
Standard Forms 424, Application for Federal Assistance; SF-424A, Budget
Information--Non-Construction Programs; SF-424B, Assurances--Non-
Construction Programs; SF-424C, Budget Information--Construction
Programs; SF-424D, Assurances--Construction Programs; as well as the
Commerce Department (CD) form CD-346, Applicant for Funding Assistance,
as appropriate, shall be used in applying for financial assistance. In
addition, Forms CD-511, Certification Regarding Lobbying; CD-512,
Certification Regarding Lobbying--Lower-Tier Covered Transactions; and
SF-LLL, Disclosure of Lobbying Activities, will be used as appropriate.
9. Environmental Requirements. Environmental impacts must be
considered by Federal decision makers in their decisions whether or not
to (1) approve a proposal for Federal assistance; (2) approve the
proposal with mitigation; or (3) approve a different proposal/grant
having less adverse environmental impacts. Federal environmental laws
require that the funding agency initiate a planning process with an
early consideration of potential environmental impacts that projects
funded with Federal assistance may have on the environment. The
recipient and subrecipients must comply with all environmental
standards, to include those prescribed under the following statutes and
Executive Orders, and shall identify to the awarding agency any impact
the award may have on the environment. In some cases, award funds can
be withheld by the Grants Officer under a special award condition
requiring the recipient to submit additional environmental compliance
information sufficient to enable the DOC to make an assessment on any
impacts that a project may have on the environment.
(a) The National Environmental Policy Act of 1969 (42 U.S.C. 4321
et seq.). Recipients of Federal assistance are required to identify to
the awarding agency any impact an award will have on the quality of the
human environment, and assist the agency to comply with the National
Environmental Policy Act. Applicants for assistance may be required to
prepare environmental impact information as part of a proposal.
(b) Floodplain Management, EO 11988 and, Protection of Wetlands, EO
11990, May 24, 1977. Recipients must identify proposed actions in
Federally defined floodplains and wetlands to enable the agency to make
a determination whether there is an alternative to minimize any
potential harm.
(c) Clean Air Act, Clean Water Act, and EO 11738. Recipients must
comply with the provisions of the Clean Air Act (42 U.S.C. 7401 et
seq.), Clean Water Act (33 U.S.C. 1251 et seq.), and EO 11738, and
shall not use a facility on EPA's List of Violating Facilities in
performing any award that is nonexempt under 40 CFR 15.5, and shall
notify the Program Officer in writing if it intends to use a facility
that is on the EPA List of Violating Facilities or knows that the
facility has been recommended to be placed on the List.
(d) The Flood Disaster Protection Act of 1973 (42 U.S.C. 4002 et
seq.). Flood insurance, when available, is required for Federally
assisted construction or acquisition in flood-prone areas.
(e) The Endangered Species Act of 1973, as amended (16 U.S.C. 1531
et seq.). Recipients must identify any impact or activities which may
involve a threatened or endangered species. Federal agencies have the
responsibility to ensure that no adverse effects to a protected species
or habitat occur from actions under Federal assistance awards and
conduct the required reviews under the Endangered Species Act, as
applicable.
(f) The Coastal Zone Management Act, as amended (16 U.S.C. 1451 et
seq.). Funded projects must be consistent with a coastal state's
approved management program for the coastal zone.
(g) The Coastal Barriers Resources Act (16 U.S.C. 3501 et seq.).
Restrictions are placed on Federal funding for actions within a Coastal
Barrier System.
(h) The Wild and Scenic Rivers Act, as amended (16 U.S.C. 1271 et
seq.). This Act applies to awards that may affect existing or proposed
components of the National Wild and Scenic Rivers system.
(i) The Safe Drinking Water Act of 1974, as amended (42 U.S.C.
300f-j). This Act precludes Federal assistance for any project that the
EPA determines may contaminate a solesource aquifer so as to threaten
public health.
(j) The Resource Conservation and Recovery Act of 1976, as amended
(42 U.S.C. 6901 et seq.). This act regulates the generation,
transportation, treatment, and disposal of hazardous wastes, and also
provides that recipients of Federal funds give preference in their
procurement programs to the purchase of recycled products pursuant to
EPA guidelines.
(k) The Comprehensive Environmental Response, Compensation, and
Liability Act of 1980, as amended, and the Superfund Amendments and
Reauthorization Act of 1986, and the Community Environmental Response
Facilitation Act of 1992, as amended, (42 U.S.C. 9601 et seq.). These
requirements address responsibilities of hazardous substance releases,
threatened releases and environmental cleanup. There is also a
requirement to impose reporting and community involvement requirements
to ensure disclosure of the release or disposal of regulated substances
and cleanup of hazards.
(l) Environmental Justice in Minority Populations and Low Income
Populations, EO 12898, February 11, 1994. This order identifies and
addresses adverse human health or environmental effects of programs,
policies and activities on low income and minority populations.
10. Limitation of Liability. In no event will the Department of
Commerce be responsible for proposal preparation costs if programs
announced under notices of funding availability fail to receive funding
or are cancelled because of other agency priorities. Publication of
[[Page 78392]]
announcements of funding availability do not oblige the agency to award
any specific project or to obligate any available funds.
B. The following general provisions will apply to all DOC grant and
cooperative agreement awards:
1. Administrative Requirements and Cost Principles. The uniform
administrative requirements for all DOC grants and cooperative
agreements are codified at 15 CFR Part 14, ``Uniform Administrative
Requirements for Grants and Agreements with Institutions of Higher
Education, Hospitals, Other Non-Profit, and Commercial Organizations;''
and 15 CFR Part 24, ``Uniform Administrative Requirements for Grants
and Agreements to State and Local Governments.'' The following list of
cost principles incorporated by reference in 15 CFR Parts 14 and 24 are
included in DOC's grants and cooperative agreements: OMB Circular A-21,
``Cost Principles for Educational Institutions;'' OMB Circular A-87,
``Cost Principles for State, Local and Indian Tribal Governments;'' OMB
Circular A-122, ``Cost Principles for Nonprofit Organizations;'' and
Federal Acquisition Regulation Subpart 31.2, ``Contracts with
Commercial Organizations,'' codified at 48 CFR 31.2. Applicable
administrative requirements and cost principles are identified in each
award and are incorporated into the award by reference.
2. Award Payments. When advanced payment is authorized, advances
will be limited to the minimum amounts necessary to meet immediate
disbursement needs, but in no case should advances exceed the amount of
cash required for a 30-day period. Advanced funds not disbursed in a
timely manner must be promptly returned to DOC. Certain bureaus within
the DOC use the Department of Treasury's Automated Standard Application
for Payment (ASAP) system. In order to receive payments under ASAP,
recipients will be required to enroll with the Department of Treasury,
Financial Service, Regional Financial Centers, which allows them to use
the on-line and Voice Response System (VRS) method of withdrawing funds
from their ASAP established accounts.
3. Federal and Non-Federal Sharing.
(a) Awards that include Federal and non-Federal sharing will
incorporate a budget consisting of shared allowable costs. If actual
allowable costs are less than the total approved budget, the Federal
and non-Federal cost shares shall be calculated by applying the
approved Federal and non-Federal cost share ratios to actual allowable
costs. If actual allowable costs are greater than the total approved
budget, the Federal share will not exceed the total Federal dollar
amount authorized by the award.
(b) The non-Federal share, whether in cash or in-kind, will be
expected to be paid out at the same general rate as the Federal share.
Exceptions to this requirement may be granted by the Grants Officer
based on sufficient documentation demonstrating previously determined
plans for or later commitment of cash or in-kind contributions. In any
case, recipients must meet the cost share commitment over the life of
the award.
4. Budget Changes. When the terms of an award allow the recipient
to transfer funds among approved direct cost categories, the transfer
authority does not authorize the recipient to create new budget
categories within an approved budget unless the Grants Officer has
provided prior approval. In addition, the recipient will not be
authorized at any time to transfer amounts budgeted for direct costs to
the indirect costs line item or vice versa, without written prior
approval of the Grants Officer.
5. Indirect Costs.
(a) Indirect costs will not be allowable charges against an award
unless specifically included as a line item in the approved budget
incorporated into the award. (The term ``indirect cost'' has been
replaced with the term ``facilities and administrative costs'' under
OMB Circular A-21, ``Cost Principles for Educational Institutions.'')
(b) Excess indirect costs may not be used to offset unallowable
direct costs.
(c) If the recipient has not previously established an indirect
cost rate with a Federal agency, the negotiation and approval of a rate
will be subject to the procedures in the applicable cost principles and
the following subparagraphs:
(1) a. State, local, and Indian Tribal Governments; Educational
Institutions; and Non-Profit Organizations (Non-Commercial Organizations)
For those organizations for which DOC is cognizant or has
oversight, DOC or its designee will either negotiate a fixed rate with
carryforward provisions or, in some instances, limit its review to
evaluating the procedures described in the recipient's cost allocation
methodology plan. Indirect cost rates and cost allocation methodology
reviews are subject to future audits to determine actual indirect costs.
b. Commercial Organizations
For commercial organizations, cognizant federal agency is defined
as the agency that provides the largest dollar amount of negotiated
contracts, including options. If the only federal funds received by a
commercial organization are DOC award funds, then DOC becomes the
cognizant federal agency for the purpose of indirect cost negotiations.
For those organizations for which DOC is cognizant, DOC or its designee
will negotiate a fixed rate with carryforward provisions for the
recipient. Fixed rate means an indirect cost rate which has the same
characteristics as a pre-determined rate, except that the difference
between the estimated costs and the actual costs of the period covered
by the rate is carried forward as an adjustment to the rate computation
of the subsequent period. DOC or its designee will negotiate indirect
cost rates using the cost principles found in 48 CFR Part 31,
``Contract Cost Principles and Procedures.'' For guidance on how to put
an indirect cost plan together go to:
http://www2.dol.gov/oasam/programs/guide.htm.
(2) Within 90 days of the award start date, the recipient shall
submit to the address listed below documentation (indirect cost
proposal, cost allocation plan, etc.) necessary to perform the review.
The recipient shall provide the Grants Officer with a copy of the
transmittal letter. Office of Acquisition Management, U.S. Department
of Commerce, 14th Street and Constitution Avenue, NW., Room-6054,
Washington, DC 20230.
(3) The recipient can use the fixed rate proposed in the indirect
cost plan until such time as the DOC provides a response to the
submitted plan. Actual indirect costs must be calculated annually and
adjustments made through the carryforward provision used in calculating
next year's rate. This calculation of actual indirect costs and the
carryforward provision is subject to audit. Indirect cost rate
proposals must be submitted annually. Organizations that have
previously established indirect cost rates must submit a new indirect
cost proposal to the cognizant agency within six months after the close
of each recipient's fiscal year.
(4) When DOC is not the oversight or cognizant Federal agency, the
recipient shall provide the Grants Officer with a copy of a negotiated
rate agreement or a copy of the transmittal letter submitted to the
cognizant or oversight Federal agency requesting a negotiated rate
agreement.
(5) If the recipient fails to submit the required documentation to
the DOC within 90 days of the award start date, the recipient may be
precluded from recovering any indirect costs under the award. If the
DOC, oversight, or cognizant Federal agency determines there is a
finding of good and sufficient
[[Page 78393]]
cause to excuse the recipient's delay in submitting the documentation,
an extension of the 90-day due date may be approved by the Grants Officer.
(6) Regardless of any approved indirect cost rate applicable to the
award, the maximum dollar amount of allocable indirect costs for which
DOC will reimburse the recipient shall be the lesser of the line item
amount for the Federal share of indirect costs contained in the
approved budget of the award, or the Federal share of the total
allocable indirect costs of the award based on the indirect cost rate
approved by an oversight or cognizant Federal agency and current at the
time the cost was incurred, provided the rate is approved on or before
the award end date.
6. Tax Refunds. Refunds of FICA/FUTA taxes received by a recipient
during or after an award period must be refunded or credited to DOC
where the benefits were financed with Federal funds under the award.
Recipients must agree to contact the Grants Officer immediately upon
receipt of these refunds. Recipients must further agree to refund
portions of FICA/FUTA taxes determined to belong to the Federal
Government, including refunds received after the award end date.
7. Other Federal Awards with Similar Programmatic Activities.
Recipients will be required to provide written notification to the
Federal Program Officer and the Grants Officer in the event that,
subsequent to receipt of the DOC award, other financial assistance is
received to support or fund any portion of the scope of work
incorporated into the DOC award. DOC will not pay for costs that are
funded by other sources.
8. Non-Compliance With Award Provisions. Failure to comply with any
or all of the provisions of an award may have a negative impact on
future funding by DOC and may be considered grounds for any or all of
the following actions: establishment of an account receivable,
withholding payments under any DOC awards to the recipient, changing
the method of payment from advance to reimbursement only, or the
imposition of other special award conditions, suspension of any DOC
active awards, and termination of any DOC active awards.
9. Prohibition Against Assignment by the Recipient. Notwithstanding
any other provision of an award, recipients may not transfer, pledge,
mortgage, or otherwise assign an award, or any interest therein, or any
claim arising thereunder, to any party or parties, banks, trust
companies, or other financing or financial institutions without the
express written approval of the Grants Officer.
10. Non-Discrimination Requirements. There are several Federal
statutes, regulations, Executive Orders, and policies relating to
nondiscrimination. No person in the United States shall, on the ground
of race, color, national origin, handicap, religion, age, or sex, be
excluded from participation in, be denied the benefits of, or be
subject to discrimination under any program or activity receiving
Federal financial assistance. These requirements include but are not
limited to:
(a) Title VI of the Civil Rights Act of 1964 (42 U.S.C. 2000d et
seq.) and DOC implementing regulations published at 15 CFR Part 8
prohibiting discrimination on the grounds of race, color, or national
origin under programs or activities receiving Federal financial assistance;
(b) Title IX of the Education Amendments of 1972 (20 U.S.C. 1681 et
seq.) and implementing regulations at 15 CFR Part 8a prohibiting
discrimination on the basis of sex under Federally assisted education
programs or activities;
(c) Section 504 of the Rehabilitation Act of 1973, as amended (29
U.S.C. 794) and DOC implementing regulations published at 15 CFR Part
8b prohibiting discrimination on the basis of handicap under any
program or activity receiving or benefitting from Federal assistance;
(d) The Age Discrimination Act of 1975, as amended (42 U.S.C. 6101
et seq.) and DOC implementing regulations published at 15 CFR Part 20
prohibiting discrimination on the basis of age in programs or
activities receiving Federal financial assistance;
(e) The Americans with Disabilities Act of 1990 (42 U.S.C. 12101 et
seq.) prohibiting discrimination on the basis of disability under
programs, activities, and services provided or made available by state
and local governments or instrumentalities or agencies thereto, as well
as public or private entities that provide public transportation;
(f) Title VIII of the Civil Rights Act of 1968 (42 U.S.C. 3601 et
seq.), as amended, relating to nondiscrimination in the sale, rental or
financing of housing;
(g) Parts II and III of Executive Order 11246, as amended by
Executive Orders 11375 and 12086 requiring Federally assisted
construction contracts to include the nondiscrimination provisions of
Sec. 202 and 203 of that Executive Order and Department of Labor
regulations implementing Executive Order 11246, 41 CFR 60-1.4(b).
(h) EO 13166 (August 11, 2000), ``Improving Access to Services for
Persons With Limited English Proficiency,'' and DOC policy guidance
issued on March 24, 2003 (68 FR 14180) to Federal financial assistance
recipients on the Title VI prohibition against national origin
discrimination affecting Limited English Proficient (LEP) persons.
(i) In recognition of the constitutionally-protected interest of
religious organizations in making religiously-motivated employment
decisions, Title VII of the Civil Rights Act of 1964, 42 U.S.C. 2000e
et seq., expressly exempts religious organizations from the prohibition
against discrimination on the basis of religion. 42 U.S.C. 2000e-1(a).
11. Audits of Organizations Not Covered By OMB Circular A-133. In
accordance with 15 CFR 14.26(c) and (d), for-profit hospitals,
commercial, and other organizations not covered by the audit provisions
of OMB Circular A-133 that expend $500,000 or more in a year in Federal
funding, are required to have a program-specific audit performed at the
conclusion of the project, but no less than once every five years. The
DOC award may include a line item in the budget for the cost of the
audit. Some DOC programs have specific audit guidelines that will be
incorporated into the award. If DOC does not have a program-specific
audit guide available for the program, the auditor should follow
Generally Accepted Government Auditing Standards and the requirements
for a program-specific audit as described in OMB Circular A-133 Sec. 235.
12. Policies and Procedures for Resolution of Audit-Related Debts.
DOC has established policies and procedures for handling the resolution
and reconsideration of financial assistance audits which have resulted
in, or may result in, the establishment of a debt (account receivable)
for financial assistance awards. These policies and procedures are
contained in the Federal Register notice dated January 27, 1989. See 54
FR 4053. The policies and procedures are also provided in more detail
in the Department of Commerce Financial Assistance Standard Terms and
Conditions.
13. Debts. Any debts determined to be owed the Federal Government
shall be paid promptly by the recipient. In accordance with 15 CFR
21.4, a debt will be considered delinquent if it is not paid within 15
days of the due date, or if there is no due date, within 30 days of the
billing date. Failure to pay a debt by the due date, or if there is no
due date, within 30 days of the billing date, shall result in the
imposition of late payment charges. In addition, failure to
[[Page 78394]]
pay the debt or establish a repayment agreement by the due date, or if
there is no due date, within 30 days of the billing date, will also
result in the referral of the debt for collection action and may result
in DOC taking further action as specified in the terms of the award.
Funds for payment of a debt must not come from other Federally
sponsored programs. Verification that other Federal funds have not been
used will be made, e.g., during on-site visits and audits.
14. Post-Award Discovery of Adverse Information. After an award is
made, if adverse information on a recipient or any key individual
associated with a recipient is discovered which reflects significantly
and adversely on the recipient's responsibility, the Grants Officer may
take the following actions:
(a) Require the recipient to correct the conditions.
(b) Consider the recipient to be ``high risk'' and unilaterally
impose special award conditions to protect the Federal Government's
interest.
(c) Suspend or terminate an active award. The recipient will be
afforded adequate due process while effecting such actions.
(d) Require the removal of personnel from association with the
management of and/or implementation of the project and require Grants
Officer approval of personnel replacements.
15. Competition and Codes of Conduct.
(a) Pursuant to the certification in SF-424B, Paragraph 3,
recipients must maintain written standards of conduct to establish
safeguards to prohibit employees from using their positions for a
purpose that constitutes or presents the appearance of a personal or
organizational conflict of interest, or personal gain in the
administration of this award and any subawards.
(b) Recipients must maintain written standards of conduct governing
the performance of their employees engaged in the award and
administration of subawards. No employee, officer, or agent shall
participate in the selection, award, or administration of a subaward
supported by Federal funds if a real or apparent conflict of interest
is or would be involved. Such a conflict would arise when the employee,
officer, or agent, any member of his or her immediate family, his or
her partner, or an organization in which he/she serves as an officer or
which employs or is about to employ any of the parties mentioned in
this section, has a financial or other interest in the organization
selected or to be selected for a subaward. The officers, employees, and
agents of the recipient may not solicit or accept anything of monetary
value from subrecipients. However, recipients may set standards for
situations in which the financial interest is not substantial or the
gift is an unsolicited item of nominal value. The standards of conduct
must provide for disciplinary actions to be applied for violations of
such standards by officers, employees, or agents of a recipient.
(c) All subawards will be made in a manner to provide, to the
maximum extent practicable, open and free competition. Recipients must
be alert to organizational conflicts of interest as well as other
practices among subrecipients that may restrict or eliminate
competition. In order to ensure objective subrecipient performance and
eliminate unfair competitive advantage, subrecipients that develop or
draft work requirements, statements of work, or requests for proposals
will be excluded from competing for such subawards.
(d) For purposes of the award, a financial interest may include
employment, stock ownership, a creditor or debtor relationship, or
prospective employment with an applicant. An appearance of impairment
of objectivity could result from an organizational conflict where,
because of other activities or relationships with other persons or
entities, a person is unable or potentially unable to act in an
impartial manner. It could also result from non-financial gain to the
individual, such as benefit to reputation or prestige in a professional
field.
16. Minority Owned Business Enterprise. DOC encourages recipients
to utilize minority and women-owned firms and enterprises in contracts
under financial assistance awards. The Minority Business Development
Agency can assist recipients in matching qualified minority owned
enterprises with contract opportunities.
17. Subaward and/or Contract to a Federal Agency. Recipients,
subrecipients, contractors, and/or subcontractors may not sub-grant or
sub-contract any part of an approved project to any Federal department,
agency, instrumentality, or employee thereof, without the prior written
approval of the Grants Officer.
18. Foreign Travel. Recipients must comply with the provisions of
the Fly America Act, 49 U.S.C. 40118. The Fly America Act requires that
Federal travelers and others performing U.S. Government-financed
foreign air travel must use U.S. flag carriers, to the extent that
service by such carriers is available. Foreign air carriers may be used
only in specific instances, such as when a U.S. flag air carrier is
unavailable, or use of U.S. flag carrier service will not accomplish
the agency's mission. The implementing Federal Travel Regulations are
found at 41 CFR 301-10.131 through 301-10.143.
19. Purchase of American-Made Equipment and Products. Recipients
are hereby notified that they are encouraged, to the greatest extent
practicable, to purchase American-made equipment and products with
funding provided under DOC financial assistance awards.
20. Intellectual Property Rights.
(a) Inventions. The rights to any invention made by a recipient
under a DOC financial assistance award are determined by the Bayh-Dole
Act, Pub. L. 96-517, as amended, and codified in 35 U.S.C. 200 et seq.,
except as otherwise required by law. The specific rights and
responsibilities are described in more detail in 37 CFR Part 401 and in
particular, in the standard patent rights clause in 37 CFR 401.14,
which is incorporated by reference into awards.
(b) Patent Notification Procedures. Pursuant to EO 12889, the
Department of Commerce (DOC) is required to notify the owner of any
valid patent covering technology whenever the DOC or its financial
assistance recipients, without making a patent search, knows (or has
demonstrable reasonable grounds to know) that technology covered by a
valid United States patent has been or will be used without a license
from the owner. To ensure proper notification, if the recipient uses or
has used patented technology under this award without a license or
permission from the owner, the recipient will be required to notify the
DOC Patent Counsel and the Grants Officer. This notice does not
necessarily mean that the government authorizes and consents to any
copyright or patent infringement occurring under the financial assistance.
(c) Data, Databases, and Software. The rights to any work produced
or purchased under a DOC Federal financial assistance award are
determined by 15 CFR 24.34 and 15 CFR 14.36. Such works may include
data, databases or software. The recipient owns any work produced or
purchased under a DOC Federal financial assistance award subject to
DOC's right to obtain, reproduce, publish or otherwise use the work or
authorize others to receive, reproduce, publish or otherwise use the
data for Government purposes.
(d) Copyright. The recipient may copyright any work produced under
a DOC Federal financial assistance award subject to DOC's royalty-free
nonexclusive and irrevocable right to
[[Page 78395]]
reproduce, publish or otherwise use the work or authorize others to do
so for Government purposes. Works jointly authored by DOC and recipient
employees may be copyrighted but only the part authored by the
recipient is protected because, under 17 U.S.C. 105, works produced by
Government employees are not copyrightable in the United States. On
occasion, DOC may ask the recipient to transfer to DOC its copyright in
a particular work when DOC is undertaking the primary dissemination of
the work. Ownership of copyright by the Government through assignment
is permitted by 17 U.S.C. 105.
21. Seat Belt Use. Pursuant to EO 13043, recipients should
encourage employees and contractors to enforce on-the-job seat belt
policies and programs when operating recipient/company-owned, rented or
personally owned vehicles.
22. Research Involving Human Subjects. All proposed research
involving human subjects must be conducted in accordance with 15 CFR
Part 27, ``Protection of Human Subject.'' No research involving human
subjects is permitted under any DOC financial assistance award unless
expressly authorized by the Grants Officer.
23. Federal Employee Expenses. Federal agencies are generally
barred from accepting funds from a recipient to pay transportation,
travel, or other expenses for any Federal employee unless specifically
approved in the terms of the award. Use of award funds (Federal or non-
Federal) or the recipient's provision of in-kind goods or services for
the purposes of transportation, travel, or any other expenses for any
Federal employee, may raise appropriation augmentation issues. In
addition, DOC policy prohibits the acceptance of gifts, including
travel payments for Federal employees, from recipients or applicants
regardless of the source.
24. Preservation of Open Competition and Government Neutrality
Towards Government Contractors' Labor Relations on Federal and
Federally Funded Construction Projects. Pursuant to EO 13202,
``Preservation of Open Competition and Government Neutrality Towards
Government Contractors' Labor Relations on Federal and Federally Funded
Construction Projects,'' unless the project is exempted under section
5(c) of the order, bid specifications, project agreements, or other
controlling DOCuments for construction contracts awarded by recipients
of grants or cooperative agreements, or those of any construction
manager acting on their behalf, shall not: (1) Include any requirement
or prohibition on bidders, offerors, contractors, or subcontractors
about entering into or adhering to agreements with one or more labor
organizations on the same or related construction project(s); or (2)
otherwise discriminate against bidders, offerors, contractors, or
subcontractors for becoming or refusing to become or remain signatories
or otherwise to adhere to agreements with one or more labor
organizations, on the same or other related construction project(s).
25. Minority Serving Institutions (MSIs) Initiative. Pursuant to
EOs 12876, 12900, and 13021, DOC is strongly committed to broadening
the participation of MSIs in its financial assistance programs. DOC
goals include achieving full participation of MSIs in order to advance
the development of human potential, strengthen the Nation's capacity to
provide high-quality education, and increase opportunities for MSIs to
participate in and benefit from Federal financial assistance programs.
DOC encourages all applicants and recipients to include meaningful
participation of MSIs. Institutions eligible to be considered MSIs are
listed on the Department of Education Web site at
http://www.ed.gov/offices/OCR/minorityinst.html.
26. Access to Records. The Inspector General of the DOC, or any of
his or her duly authorized representatives, the Comptroller of the
United States and, if appropriate, the State, shall have access to any
pertinent books, documents, papers and records of the parties to a
grant or cooperative agreement, whether written, printed, recorded,
produced, or reproduced by any electronic, mechanical, magnetic or
other process or medium, in order to make audits, inspections,
excerpts, transcripts, or other examinations as authorized by law. An
audit of an award may be conducted at any time. Recipients that are
subject to OMB Circular A-133, ``Audits of States, Local Governments,
and Non-Profit Organizations,'' and that expend $500,000 or more
annually in Federal awards shall have an organization-wide audit
performed, unless a program-specific audit is determined by DOC to be
more appropriate. Other recipients will be subject to the audit
requirements as stipulated in the award or subaward document.
27. Scientific or Research Misconduct. Scientific or research
misconduct refers to the fabrication, falsification, or plagiarism in
proposing, performing, or reviewing research, or in reporting research
results. It does not include honest errors or differences of opinion.
The recipient organization has the primary responsibility to
investigate allegations and provide reports to the Federal Government.
Funds expended on an activity that is determined to be invalid or
unreliable because of scientific misconduct may result in a
disallowance of costs for which the institution may be liable for
repayment to the awarding agency. The Office of Science and Technology
Policy at the White House published in the Federal Register on December
6, 2000, a final policy that addressed research misconduct. The policy
was developed by the National Science and Technology Council (65 FR
76260). The DOC requires that any allegation be submitted to the Grants
Officer, who will also notify the OIG of such allegation. Generally,
the recipient organization shall investigate the allegation and submit
its findings to the Grants Officer. The DOC may accept the recipient's
findings or proceed with its own investigation. The Grants Officer
shall inform the recipient of the DOC's final determination.
28. Intergovernmental Personnel Act of 1970 (42 U.S.C. 4728-4763).
Recipients must comply with this act relating to prescribed standards
for merit systems for programs funded under one of the 19 statutes or
regulations specified in Appendix A of the Office of Personnel
Management Standards for a Merit System of Personnel Administration (5
CFR Part 900, Subpart F).
29. Uniform Relocation Assistance and Real Property Acquisition
Policies Act of 1970, as amended, (42 U.S.C. 4601 et seq.); and
implementing regulations issued at 15 CFR Part 11. These provide for
fair and equitable treatment of persons displaced or whose property is
acquired as a result of Federal or Federally-assisted programs. These
requirements apply to all interests in real property acquired for
project purposes regardless of Federal participation in purchases.
30. Historic Preservation. Recipients must assist the DOC in
assuring compliance with Section 106 of the National Historic
Preservation Act of 1966, as amended and the Advisory Council on
Historic Preservation Guidelines, (16 U.S.C. 470 et seq.); the
Archaeological and Historic Preservation Act of 1974, (16 U.S.C. 469a-1
et seq.); Protection and Enhancement of the Cultural Environment, EO
11593; Locating Federal Facilities on Historic Properties in our
Nation's Central Cities, EO 13006; and Indian Sacred Sites, EO 13007
(ensures protection and accommodation of access).
[[Page 78396]]
31. Lead-Based Paint Poisoning Prevention Act (42 U.S.C. 4801 et
seq.). This act prohibits the use of lead-based paint in construction
or rehabilitation of residence structures.
32. Hatch Act (5 U.S.C. 1501-1508 and 7324-7328). This act limits
the political activities of employees or officers of state or local
governments whose principal employment activities are funded in whole
or in part with Federal funds.
33. Labor standards for Federally-assisted construction
subagreements (wage guarantees). Recipients must comply, as applicable,
with the provisions of the Davis-Bacon Act (40 U.S.C. 276a to 276a-7);
the Copeland Act (40 U.S.C. 276c and 18 U.S.C. 874); and the Contract
Work Hours and Safety Standards Act (40 U.S.C. 327-333).
34. Care and Use of Live Vertebrate Animals. Recipients must comply
with the Laboratory Animal Welfare Act of 1966 (Pub. L. 89-544), as
amended, (7 U.S.C. 2131 et seq.) (animal acquisition, transport, care,
handling, and use in projects), and implementing regulations, 9 CFR
Parts 1, 2, and 3; the Endangered Species Act (16 U.S.C. 1531 et seq.);
Marine Mammal Protection Act (16 U.S.C. 1361 et seq.) (taking
possession, transport, purchase, sale, export or import of wildlife and
plants); The Nonindigenous Aquatic Nuisance Prevention and Control Act
(16 U.S.C. 4701 et seq.) (ensure preventive measures are taken or that
probable harm of using species is minimal if there is an escape or
release); and all other applicable statutes pertaining to the care,
handling, and treatment of warm blooded animals held for research,
teaching, or other activities supported by Federal financial
assistance. No research involving vertebrate animals is permitted under
any DOC financial assistance award unless authorized by the Grants
Officer.
35. Publications and Acknowledgment of Sponsorship. Publication of
the results of a research project in appropriate professional journals
is encouraged as an important method of recording and reporting
scientific information. The recipient is required to submit a copy to
the funding agency and when releasing information related to a funded
project include a statement that the project or effort undertaken was
or is sponsored by DOC. The recipient is also responsible for assuring
that every publication of material (including Internet sites) based on
or developed under an award, except scientific articles or papers
appearing in scientific, technical or professional journals, contains
the following disclaimer: `` This [report/video] was prepared by
[recipient name] under award [number] from [name of operating unit],
U.S. Department of Commerce. The statements, findings, conclusions, and
recommendations are those of the author(s) and do not necessarily
reflect the views of the [name of operating unit] or the U.S.
Department of Commerce.'' This also applies to videos produced under
DOC financial assistance awards.
36. Videos Produced under DOC Financial Assistance Awards. Before
production of a video for public viewing is begun, the Grants Officer
must review and approve the production plans and the final video to
ensure that it will be of an acceptable quality and appropriately
represents the DOC.
C. The Federal Register notices announcing the availability of
Federal funds for each DOC competitive financial assistance program
will contain only the following program-specific information: Summary
description of program; deadline dates; addresses for submission of
applications; information contacts (including electronic access);
amount of funding available; statutory authority; Catalog of Federal
Domestic Assistance (CFDA) number; eligibility requirements; cost
sharing or matching requirements; Intergovernmental Review
requirements; evaluation criteria used by the merit reviewers;
selection procedures, including funding priorities/selection factors/
policy factors to be applied by the selecting official; and
Administrative and National Policy Requirements.
D. The DOC follows the uniform format for announcements of funding
opportunities for discretionary grants and cooperative agreements
established by the Office of Management and Budget in a policy letter
published in the Federal Register. See 68 FR 37370 (June 23, 2003).
These funding opportunity announcements are available on grants.gov or
from the information contact listed in the Federal Register.
Executive Order 12866
This notice has been determined to be ``not significant'' for
purposes of EO 12866, ``Regulatory Planning and Review.''
Administrative Procedure Act and Regulatory Flexibility Act
Because notice and comment are not required under 5 U.S.C. 553, or
any other law, for this notice relating to public property, loans,
grants benefits or contracts (5 U.S.C. 553(a)), a Regulatory
Flexibility Analysis is not required and has not been prepared for this
notice.
Executive Order 12132 (Federalism)
It has been determined that this notice does not contain policies
with Federalism implications as that term is defined in EO 13132.
Paperwork Reduction Act
These regulatory actions do not impose any new reporting or
recordkeeping requirements under the Paperwork Reduction Act.
Notwithstanding any other provisions of the law, no person is required
to respond to, nor shall any person be subject to a penalty for failure
to comply with a collection-of-information, subject to the requirements
of the Paperwork Reduction Act (PRA), 44 U.S.C. 3501 et seq., unless
that collection of information displays a currently valid Office of
Management and Budget (OMB) control number. Forms SF-424, SF-424A, SF-
424B, SF-424C, SF-424D, SF-LLL, and CD-346, have been approved under
control numbers 0348-0043, 0348-0044, 0348-0040, 0348-0041, 0348-0042,
0348-0046, and 0605-0001, respectively.
Catalog of Federal Domestic Assistance
This notice affects all of the grant and cooperative agreement
programs funded by DOC. The Catalog of Federal Domestic Assistance can
be accessed on the Internet under the DOC Grants Management Web site at
http://www.cfda.gov.
List of Subjects
Accounting, Administrative practice and procedures, Grants
administration, Grant programs-economic development, Grant programs-
oceans, atmosphere and fisheries management, Grant programs-minority
businesses, Grant programs-technology, Grant programs-
telecommunications, Grant programs-international, Reporting and
recordkeeping requirements.
Issued this 22nd day of December, 2004, at Washington, DC.
Michael S. Sade,
Director for Acquisition Management and Procurement Executive.
[FR Doc. 04-28635 Filed 12-29-04; 8:45 am]