Guidance for Reporting and Use of Information Concerning Recipient Integrity and Performance, 43301-43311 [2015-17753]
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43301
Rules and Regulations
Federal Register
Vol. 80, No. 140
Wednesday, July 22, 2015
This section of the FEDERAL REGISTER
contains regulatory documents having general
applicability and legal effect, most of which
are keyed to and codified in the Code of
Federal Regulations, which is published under
50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by
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new books are listed in the first FEDERAL
REGISTER issue of each week.
OFFICE OF MANAGEMENT AND
BUDGET
2 CFR Parts 180 and 200
Guidance for Reporting and Use of
Information Concerning Recipient
Integrity and Performance
Executive Office of the
President, Office of Management and
Budget.
ACTION: Final guidance.
AGENCY:
The Office of Management
and Budget (OMB) is issuing final
guidance to Federal agencies to
implement Section 872 of the Duncan
Hunter National Defense Authorization
Act for Fiscal Year 2009 (hereafter
referred to as ‘‘section 872’’), as that
statute applies to grants. As section 872
required, OMB and the General Services
Administration (GSA) have established
an integrity and performance system
that includes governmentwide data with
specified information related to the
integrity and performance of entities
awarded Federal grants and contracts.
This system, currently designated as the
Federal Awardee Performance and
Integrity Information System (FAPIIS),
integrates various sources of
information on the eligibility of
organizations for Government awards
and is currently available at https://
www.fapiis.gov.
This final guidance implements
section 872’s requirements for recipients
and Federal awarding agencies to report
information that will appear in the
OMB-designated integrity and
performance system and for Federal
awarding agencies to consider
information the system contains about a
non-Federal entity before awarding a
grant to that non-Federal entity. The
final guidance for grants, which also
applies to cooperative agreements, also
addresses how the designated integrity
and performance system and other
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SUMMARY:
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information may be used in assessing
recipient integrity.
DATES: This guidance is effective
January 1, 2016.
FOR FURTHER INFORMATION CONTACT:
Rhea Hubbard, Office of Federal
Financial Management, Office of
Management and Budget, rhubbard@
omb.eop.gov, telephone (202) 395–2743.
SUPPLEMENTARY INFORMATION:
I. Background
A. This final guidance to Federal
agencies implement Sections 872 of the
Duncan Hunter National Defense
Authorization Act for Fiscal Year 2009
(Pub. L. 110–417, codified as amended
at 41 U.S.C. 2313).
On February 18, 2010 (75 FR 7316),
the Office of Management and Budget
(OMB) proposed a number of changes to
Title 2 of the Code of Federal
Regulations (2 CFR). Since publication
of the February 2010 Federal Register
notice, OMB finalized the portion of the
guidance at 2 CFR part 25, which
includes requirements for obtaining a
Universal Identifier and registering in
the System for Award Management
(SAM) formerly called the Central
Contractor Registration system (CCR) in
the Federal Register on September 14,
2010 [75 FR 55671]. Part 25 was
expedited and finalized separately from
the guidance being issued today because
it was needed to support reporting of
subawards made on or after October 1,
2010, as the next step in
implementation of the Federal Funding
Accountability and Transparency Act
(‘‘Transparency Act,’’ Pub. L. 109–282,
as amended). The preamble of the
Federal Register notice that finalized 2
CFR part 25 included responses to the
public comments that we received on
the proposed requirements related to
DUNS numbers and CCR (which
subsequently became SAM and is
accessible at https://www.sam.gov). The
remainder of this notice therefore does
not address that portion of the February
2010 Federal Register notice.
Also since publication of the February
2010 Federal Register notice, OMB
published final guidance at 2 CFR part
200 titled Uniform Administrative
Requirements, Cost Principles, and
Audit Requirements for Federal Awards
on December 26, 2013 [78 FR 78589].
This final guidance streamlined the
Federal government’s guidance on
Administrative Requirements, Cost
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Principles, and Audit Requirements for
Federal awards and provided a
governmentwide framework for grants
management. Part 200 incorporated
portions of the proposed guidance at
part 27 regarding notices of funding
opportunities, see 2 CFR 200.203.
Therefore this notice does not address
certain portions of part 27 that were
proposed in the February 2010 Federal
Register notice. Further, OMB is no
longer issuing parts 27, 35, and 77
separately. The final guidance
incorporates the proposed guidance at
parts 27, 35, and 77 into part 200. This
approach is consistent with the intent
for part 200 to serve as a
governmentwide framework for grants
management.
The February 2010 Federal Register
notice proposed changes to
governmentwide guidance for
nonprocurement debarment and
suspension remain reflected in the final
guidance at 2 CFR part 180.
B. The major elements of the
proposed guidance, which are
addressed in this notice, are
requirements for:
• Federal awarding agencies to report
information to the designated integrity
and performance system about any
termination of an award due to a
material failure to comply with the
award terms and conditions; any
administrative agreement with a nonFederal entity to resolve a suspension or
debarment proceeding; and any finding
that a non-Federal entity is not qualified
to receive a given award, if the finding
is based on criteria related to the nonFederal entity’s integrity or prior
performance under Federal awards.
• Recipients that have Federal
contract, grant, and cooperative
agreement awards with a cumulative
total value greater than $10,000,000 to
provide information to the designated
integrity and performance system about
certain civil, criminal, and
administrative proceedings that reached
final disposition within the most recent
five year period and that were
connected with the award or
performance of a Federal award.
• Recipients that have Federal
contract, grant, and cooperative
agreement awards with a cumulative
total value greater than $10,000,000 are
required to disclose semiannually the
information about the criminal, civil,
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and administrative proceedings that
section 872(c) describes.
• Federal awarding agencies, prior to
making an award to a non-Federal
entity, to determine whether that nonFederal entity is qualified to receive that
particular award. In making the
determination, the Federal awarding
agency must take into consideration any
information about the entity that is in
the designated integrity and
performance system.
• Notice of funding opportunities and
Federal award terms and conditions to
inform a non-Federal entity that it may
submit comments to the designated
integrity and performance system about
any information that the Federal
awarding agency had reported to the
system about the non-Federal entity, for
consideration by the Federal awarding
agency in making future Federal awards
to the non-Federal entity.
We received comments on these
elements of the proposed guidance from
four State agencies, seven Federal
agencies or agency components, and
three associations representing
community health centers, academic
institutions, and industrial firms,
respectively. We considered all
comments received and made some of
the recommended improvements in
developing the final guidance. Some of
the more significant changes are to:
• Make the guidance for grants and
cooperative agreements as consistent
where practicable with the FAPIIS
guidance in the Federal Acquisition
Regulation (FAR) that applies to
procurement contracts (48 CFR 9.104),
thereby simplifying implementation for
non-Federal entities that receive both
Federal assistance and procurement
awards;
• provide information on the
legislative amendment to section 872,
which was enacted after issuance of the
proposed guidance, that requires
making certain information in the
designated integrity and performance
system available to the public;
• provide information that must be
included in a notice of funding
opportunity regarding implementation
of integrity and performance reporting;
• clarify the process that a Federal
awarding agency follows when making
a determination that a non-Federal
entity is qualified to receive an award
based on a review of information in the
designated integrity and performance
system and other sources;
• add wording to help ensure that all
non-Federal entities, including
applicants under programs that do not
have program announcements, are fully
aware of the potential effects of
information about them in the
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designated integrity and performance
system and their right to submit
comments about the information; and
• add a requirement that Federal
awarding agencies wait 14 calendar
days after posting information to the
non-public segment of the designated
integrity and performance system before
making the information available
through the public segment of the
system to be consistent with the
acquisitions community’s requirements.
Additional changes were made for
clarity or completeness. For example,
the simplified acquisition threshold set
by the Federal Acquisition Regulation
(FAR) at 48 CFR Subpart 2.1
(Definitions) is periodically adjusted for
inflation in accordance with 41 U.S.C.
1908 and is now set at $150,000.
Consequently, we updated the threshold
citation throughout the guidance by
including a reference to the definition
available at 2 CFR 200.88. Also, several
of the systems referred to in the
guidance, namely the Central Contractor
Registration (CCR) and the Excluded
Parties List System (EPLS), have been
migrated into SAM and no longer exist
as stand-alone systems. Further, the
General Services Administration (GSA)
plans to migrate the currently
designated integrity and performance
system, FAPIIS, to SAM and the
language describing the system in the
final guidance is designed to
accommodate future system changes.
Additional system migrations to SAM
and other central portals will make it
easier for agencies and recipients to
input and receive information through a
central Web site.
C. The designated integrity and
performance system integrates various
sources of information regarding nonFederal entities to help Federal
awarding agencies ensure that a
thorough review of available databases
with relevant information on to
determine whether a recipient is
qualified occurs before the issuance of
Federal awards. In addition to the
designated integrity and performance
system, Federal awarding agencies are
able to conduct matching to help
determine qualification for Federal
awards and payments through
complementary efforts, such as the Do
Not Pay working system maintained by
the Department of the Treasury. While
Treasury conducts matching against the
Do Not Pay working system for all
appropriate Federal payments, in
accordance with the Improper Payments
Elimination and Recovery Improvement
Act of 2012, Federal awarding agencies
are responsible for determining which
of the Do Not Pay databases are
appropriate to review for pre-award
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purposes. As required by 2 CFR part
180, Federal awarding agencies are
required to check SAM Exclusions prior
to the issuance of Federal awards,
which is available directly through SAM
or the Do Not Pay working system.
Federal awarding agencies are not
required to check the other databases
that are part of the Do Not Pay working
system for pre-award purposes where
the Federal awarding agency has
determined that the designated integrity
and performance system (currently
FAPIIS) and SAM provide more relevant
information to making decisions on
recipient qualification. As
governmentwide systems continue to
mature, there may be opportunities for
further integration between the various
systems.
D. Section 872 applies without
distinguishing between for-profit and
other recipients. Thus, notwithstanding
2 CFR 200.101(c) general permissive
application of subparts A through E to
for-profits, agencies must apply to forprofit recipients (in agencies’
regulations, policies, or directly through
the terms and conditions of Federal
awards) the requirements reflected in
this final guidance. OMB is considering
governmentwide guidance to apply
consistent treatment towards for-profit
grant and cooperative agreement
recipients, including the requirements
of Section 872.
E. Since publishing the proposed
guidance, Section 852 of the National
Defense Authorization Act for Fiscal
Year 2013 set forth additional
requirements for the designated
integrity and performance system to
include, to the extent practicable,
additional information on any parent,
subsidiary, or successor entities to
corporations included in the system. In
order to address these additional
requirements, OMB is considering
publishing proposed guidance to
implement Section 852 of the National
Defense Authorization Act for Fiscal
Year 2013.
II. Comments and Responses
Sections II. A through II. F of this
preamble summarize the major
comments and our responses. General
comments that address more than one
portion of the guidance are summarized
in section II.A. Each of the other
sections addresses comments pertaining
to a specific portion of the proposed
guidance.
A. General Comments
Comment: One State agency asked
when GSA will establish the specifics of
the FAPIIS data system and whether the
specifics will be posted for comment.
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Response: GSA continues to make
improvements to enable the designated
integrity and performance system to
collect other information for use by
Federal awarding agencies that must
make determinations concerning
recipient qualifications. The public
opportunity to comment on specific
information to be collected from
contractors and recipients of assistance
awards is through the Paperwork
Reduction Act (PRA) clearance process.
The PRA clearance for procurement
contracts was addressed in the Federal
Register documents with the FAR
changes and approved under OMB
Clearance Number 9000–0174. The PRA
clearance for grants and cooperative
agreements was addressed in the
Federal Register documents issued
October 1, 2010 [75 FR 60756], February
11, 2011 [76 FR 7851], and July 3, 2014
[79 FR 38028].
Comment: One industry association
and one university association asked
that we implement section 872 for
grants in a manner that conforms with
the implementation for procurement
contracts, except where justified by the
substantive differences between
assistance and procurement. Noting that
their constituents receive contracts, as
well as grants, they recommended use of
identical wording of any required
questions or assurances, as well as
electronic entry of data through the
same system.
Response: We agree that conformity to
the maximum extent practicable is
important for requirements that are
common to both recipients of grants and
contractors. The award term and
condition for grants and cooperative
agreements therefore requires recipients
to enter certain information through
SAM, the same system that contractors
use for that purpose. A recipient and
contractor must answer identical
questions in SAM and, if applicable,
must provide the same information
about the types of proceedings
identified in section 872.
Comment: The industry and
university associations and one Federal
awarding agency responded to the
invitation in the February 2010 Federal
Register notice to comment on a
possible expansion of the scope of the
designated integrity and performance
system to ‘‘include recipient
information from authoritative data
sources not described in this guidance.’’
One association recommended we not
expand the scope to information not
related to the performance of a Federal
or State contract or grant. The other
strongly suggested limiting it to
information related to performance
under Federal awards only. The Federal
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awarding agency recommended
building the system to allow for future
expansion to include data on integrity
and performance information beyond
what was delineated in the proposed
guidance.
Response: OMB may expand the
scope of the system to include
information related to integrity and
performance information beyond what
was delineated in the proposed
guidance.
Comment: A university association
suggested that we reaffirm that the term
‘‘recipient’’ throughout the 2 CFR
guidance proposed in the February 2010
Federal Register notice means the
organization receiving an award, as it
usually does in the assistance
community, and does not also include
associated individuals. They stated that
the reaffirmation was especially
important as it relates to recipient
qualification matters addressed in
subpart A of the proposed 2 CFR part
35.
Response: As defined at 2 CFR 200.86,
the term ‘‘recipient’’ means ‘‘a nonFederal entity that receives a Federal
award directly from a Federal awarding
agency to carry out an activity under a
Federal program.’’ Thus, the term does
not include individuals such as the
organization’s employees or other
individuals who may only be involved
in performance of the project or program
under the award because those
individuals did not receive the Federal
award directly from a Federal awarding
agency.
Comment: The university association
also recommended that we state in the
guidance that information in the
designated integrity and performance
system is not subject to disclosure in
response to Freedom of Information Act
(FOIA) requests. They noted that the
Federal Register notice for the final
FAR rule on section 872 stated that the
question of access to the data under
FOIA would be determined on a caseby-case basis.
Response: After publication of the
proposed guidance, section 872 was
amended to require public disclosure of
information in designated integrity and
performance system other than past
performance reviews. Actions posted in
system on or after April 15, 2011, will
be available to the public, as required by
section 3010 of Public Law 111–212.
Agencies’ disclosure of information
should be consistent with all applicable
statutes that limit such disclosures. For
example, heightened attention should
be given to whether documentation
includes information that involves
privacy, security, proprietary business
interests, and law enforcement
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investigations. Only information posted
after April 15, 2011 will be subject to
the disclosure requirements in section
3010 of Public Law 111–212.
B. Comments on Requirements in the
Proposed 2 CFR Part 27 for
Announcements of Funding
Opportunities
Comment: Two Federal awarding
agencies recommended we revise the
guidance in the proposed § 27.210 that
the form and content of agency program
announcements must adhere to those of
the standard announcement format
contained in the appendix to part 27.
They recommended that we instead
require agencies’ announcements to
comply with a ‘‘substantial
conformance’’ standard that would
provide greater flexibility. The agencies
were particularly concerned about the
wording in Section II of Subdivision 1
of the announcement format stating that
agencies’ announcements should
conform to the numbering convention in
the standard format. They noted that
wording could require them to modify
information systems currently used in
conjunction with program
announcements and associated agency
guidance documents.
Response: We removed the
information on format because OMB
reissued final guidance on notice of
funding opportunities available at 2 CFR
200.203 and Appendix I to part 200.
Further, the remaining portions of the
proposed guidance at part 27 are
incorporated into part 200.
Comment: One Federal awarding
agency noted that we should narrow the
scope of the proposed guidance for
paragraph E.3 of the announcement
format in the appendix to part 27. The
proposed guidance for that paragraph
required an agency to inform potential
applicants that awarding officials would
consider information in designated
integrity and performance system prior
to making awards. The commenter
noted that the guidance should exempt
announcements under which a Federal
awarding agency anticipated no Federal
awards with Federal funding in excess
of the simplified acquisition threshold
above which section 872 requires
Federal awarding agencies to consider
information in the system.
Response: We agree and Appendix I
to Part 200 reflects that information
regarding the designated integrity and
performance system is included in
notices of funding opportunities when
the Federal awarding agency anticipates
that any Federal award under a notice
of funding opportunity may include,
over the period of performance, a total
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Federal share greater than the simplified
acquisition threshold.
C. Comments on the Dollar Thresholds
Related to Integrity and Performance
Reporting
Comment: One State agency and two
Federal awarding agencies sought
further explanation of the differences
between the three dollar thresholds
related to the designated integrity and
performance system—at the simplified
acquisition threshold (currently
$150,000); at $500,000; and at
$10,000,000. One of the Federal
awarding agencies suggested that
implementation would be simpler if the
three thresholds were the same.
Response: The three thresholds are
consistent with the statutory
requirements of section 872:
• $500,000—Subsection (b) of section
872 is the source of the $500,000
threshold. It essentially requires that the
designated integrity and performance
system contain information about each
non-Federal entity: (1) That receives a
Federal award of more than $500,000;
and (2) about which there is a
proceeding that must be reported as
described in section 872. Therefore, the
final guidance following this preamble
states that Federal awarding agencies
must include the award term and
condition requiring the recipient to
maintain its information in designated
integrity and performance system for
each Federal award where it is
anticipated that the total Federal share
will exceed $500,000 over the period of
performance. Note that the award term
and condition requires the non-Federal
entity to provide the required
information through the SAM (formerly
CCR) and to provide the information
specified in SAM.
• $10,000,000—The source of the
$10,000,000 threshold is subsection (f)
of section 872. Under that subsection (f)
of section 872, a non-Federal entity
receiving Federal awards with a total
value more than $10,000,000 must
submit any information about criminal,
civil, and administrative proceedings
that section 872 requires and update the
information semiannually. Based on
feedback or as necessary, OMB may
revise the $10,000,000 threshold. Based
on feedback, OMB may consider
revising this affirmative disclosure
threshold for grants and cooperative
agreements to the extent legally
permissible/consistent with the statute.
• $150,000—The third threshold
relates to two requirements for the
Federal awarding agency. The source of
that threshold, which is at the
simplified acquisition threshold set by
the FAR at 48 CFR Subpart 2.1 and
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adjusted periodically to track inflation
(currently $150,000), is subparagraph
(e)(2)(A) of section 872, which requires
the Federal awarding agency to consider
information in the designated integrity
and performance system before making
a Federal award for more than that
threshold amount. In addition to
implementing that requirement, the
final guidance requires the Federal
awarding agency to report to the
designated integrity and performance
system any instance in which the
Federal awarding agency does not
award a grant or cooperative agreement
above that threshold amount to a nonFederal entity based on a determination
that the non-Federal entity is not
qualified due to its prior record of
integrity or performance under Federal
awards. The latter requirement is
analogous to the requirement for
procurement contracts in paragraph
(c)(5) of section 872.
Comment: An industry association
and two Federal awarding agencies
recommended clarifications of the term
‘‘total value’’ as used in relation to the
integrity and performance requirements.
The association recommended we adopt
the FAR wording to specify that total
value includes priced contract options,
even if not yet executed. One Federal
awarding agency suggested we clarify
whether future funding obligations
under a multi-year grant are included.
The other Federal awarding agency
noted that it was unclear whether the
dollar thresholds in part 35 and the
award term and condition in the
appendix to part 35 were based on the
Federal share of the funding or also
included any recipient cost share or
match.
Response: We agree with the
comments and the final guidance
located at part 200 is revised to provide
the recommended clarifications. The
final guidance clarifies that these
thresholds are based on the Federal
share of Federal awards and includes
the value of all expected funding over
the period of performance of the Federal
award.
Comment: An industry association
recommended that we amend the
proposed section 35.275 and require
Federal awarding agencies to include
the award term and condition for
integrity and performance reporting
only in a grant or cooperative agreement
with a total value expected to be greater
than $500,000. The commenter noted
that would be consistent with the FAR
requirement for procurement contracts.
Response: We agree. The final
guidance located at 2 CFR 200.210 is
revised, as recommended.
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D. Comments Related to Types of
Information To Be Reported to the
Designated Integrity and Performance
System
Comment: One State agency asked
who would determine what type of
information about a recipient would be
reported by the recipient, rather than
the Federal awarding agency. The
agency also asked when and how the
recipient would be notified about its
self-reporting requirements.
Response: The award term and
condition in Appendix XII to 2 CFR part
200 includes the notification to the
recipient that it must report certain
information in order to comply with the
integrity and performance reporting
requirement. The details about the
specific information that a recipient
must provide are addressed in the
guidance regarding the Entity
Management area of SAM.
Comment: Four State agencies
recommended clarifying the specific
types of proceedings about which the
proposed guidance required recipients
to report to the designated integrity and
performance system. Two agencies said
that the proposed requirement for
recipients to report on criminal, civil,
and administrative proceedings was
overly broad and some noted that State
agencies can be parties to legal
proceedings as part of their performance
of grants that fund regulatory
enforcement programs. One agency
asked why the information was to be
collected and what outcomes might
result from a reported proceeding. Other
questions were: Does the requirement
apply to local governments or just to a
recipient in the performance of its
duties under an award; does a State
agency have to report a fine assessed
against it by another State agency; and
what type of documentation must be
submitted?
Response: No change was made. The
governing statute, section 872, specifies
the breadth of the reporting
requirement. As for the purpose of
collecting the information, the
designated integrity and performance
system gives a Federal awarding agency
more information than is presently
available about a potential recipient’s
record of performance under prior
Federal awards and occurrences that
may shed light on its integrity and
business ethics. The information
supports compliance with long-standing
policy that the Federal Government
protects the public interest and ensures
the integrity of Federal programs by
conducting business only with
responsible persons.
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Potential outcomes due to reported
information depend on the nature of the
information. A Federal awarding agency
considers the information in the
designated integrity and performance
system about a non-Federal entity when
determining that the non-Federal entity
is qualified with respect to a particular
Federal award. Information that the
non-Federal entity is currently debarred
or suspended precludes the making of
the Federal award to the non-Federal
entity in almost all cases, while other
information may or may not lead the
Federal awarding agency to determine
that the non-Federal entity is not
qualified for the Federal award. The
Federal awarding agency also may
notify other Federal awarding agencies
about information in the designated
integrity and performance system—e.g.,
he or she would refer to a debarring
official information about a matter that
may be a cause for debarment.
With respect to the commenters’ other
questions:
• A local government must report if it
has a Federal award with an award term
and condition making it subject to the
reporting requirement. It would not be
required to report solely by virtue of
being a subrecipient under a Federal
award to a State agency.
• The requirement is broader than
proceedings related to a recipient’s
performance under an award. A
recipient also must report about
proceedings related to the making of a
Federal award (e.g., a conviction for
misuse of Federal appropriations to
lobby for an award).
• A State agency must report a
proceeding that results in a fine levied
against it by another State agency if the
violation or activity for which it is fined
is in connection with the making of, or
performance under, a Federal award.
• The recipient must provide the
information about a proceeding that is
required in SAM. No other
documentation is required.
Comment: Two commenters made
recommendations related to the
proposed requirement for a recipient to
report information to the designated
integrity and performance system about
proceedings related to State awards.
One commenter recommended that the
requirement be made parallel with the
one for contractors in the FAR clause
52.209–7(c)(1), by requiring reporting
only on proceedings related to Federal
awards and not also those associated
with State awards. The second
commenter recommended we clarify
that State funds appropriated to a State’s
institutions of higher education would
not be a ‘‘State award’’ for this purpose.
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Response: Due to the challenges
associated with collecting State
government information, the final
guidance does not include the proposed
requirement to collect information
related to State award proceedings.
Collection of information related State
award proceedings may be considered
in a subsequent phases of
implementation. This approach is
consistent with the FAR
implementation of section 872 (75 FR
14059).
Comment: An industry association
recommended conforming the definition
of ‘‘administrative proceeding’’ with the
definition of that term in the FAR
implementation of section 872.
Response: We agree. The definition is
revised to be consistent with the FAR
definition in section 52.209–7 of 48 CFR
part 52.
Comment: A Federal awarding agency
suggested two changes related to the
types of proceedings for which reporting
is required. It suggested defining
‘‘conviction’’ analogously to 2 CFR part
180, to include any deferred prosecution
agreement that included a statement of
guilt on the part of the defendant. The
agency also suggested eliminating
vagueness from paragraph B.3.d(i) of the
award term and condition in the
appendix to part 35, by dropping the
words ‘‘it is practical to judge’’ from the
requirement for a recipient to report on
‘‘any other criminal, civil, or
administrative proceeding if it is
practical for [the recipient] to judge that
it could have led to’’ a criminal
conviction or finding of fault and
liability that the recipient would have
been required to report.
Response: We agree in part. We
conformed the definition of
‘‘conviction’’ to the FAR definition, to
parallel the implementation of section
872 for procurement contracts, rather
than conforming it to the definition in
2 CFR part 180 that the commenter
suggested. We removed the words ‘‘it is
practical to judge’’ from the award term
and condition, as recommended.
E. Other Comments on Requirements in
2 CFR Part 35 Concerning the
Designated Integrity and Performance
System and Recipient Qualification
Comment: One Federal awarding
agency suggested amending the
proposed section 35.10 to exclude openended entitlements and programs under
which funding is allocated in
accordance with mandatory formulas
from coverage under part 35. The
Federal awarding agency questioned
whether recipient qualification was an
appropriate consideration under those
programs, generally known as
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‘‘mandatory programs,’’ and noted that
they were excluded from coverage
under the nonprocurement suspension
and debarment guidance in 2 CFR part
180.
Response: We understand that the
nature of mandatory programs could
make it more difficult than it would be
under other programs to make a Federal
award to an alternative recipient if the
Federal awarding agency determined
that a recipient was not qualified, as the
program still must serve the intended
beneficiaries. However, section 872 does
not provide for an exclusion of those
programs. Moreover, it would be
important to protect both the investment
of Federal funding and the interests of
the beneficiaries in the event that a
recipient was found not to be qualified.
Comment: One Federal awarding
agency expressed concern that the
association in the proposed section
35.110 between an awarding official’s
signature of an award document and his
or her determination concerning the
recipient’s qualification could be
misinterpreted as a requirement for a
certification that the recipient is
qualified. The agency noted that a
certification would require the awarding
official to have more information than
one could reasonably expect to be
available to him or her.
Response: The final guidance in part
200 no longer states that an awarding
official’s signature represents a
determination that a recipient is
qualified to receive a Federal award;
however, Federal awarding agencies
remain responsible for reviewing a
potential recipient’s records to
determine whether the recipient meets
the minimum standards as reflected in
2 CFR 200.205.
Comment: One Federal agency
questioned whether the use of the terms
‘‘qualified’’ and ‘‘disqualified’’ in this
part was consistent with the use of the
term ‘‘disqualified’’ in 2 CFR part 180.
The agency suggested defining at least
one of the terms to avoid unnecessary
confusion.
Response: We agree in part and made
revisions of two types. First, we revised
the wording in a number of places
within part 200 to clarify that, under
this guidance, each determination by
Federal awarding agency of a nonFederal entity’s qualification or
disqualification pertains to the specific
Federal award being contemplated at
that time. It is possible for a Federal
awarding agency to determine that a
non-Federal entity is not qualified for
one award and, depending on the
reasons for that first determination,
qualified for another award. For
example, a Federal awarding agency
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may determine that a non-Federal entity
is: (1) Not qualified for a Federal award
for a large and complex program, due to
information in the designated integrity
and performance system indicating an
unsatisfactory record for performing
under Federal awards for programs of
that level of complexity; and (2)
qualified for a second Federal award to
carry out a simpler program. Further,
Federal awarding agencies may make a
Federal award to a recipient who does
not fully meet these standards, if there
are specific conditions that can
appropriately mitigate the effects of the
non-Federal entity’s risk in accordance
with § 200.207.
The other revisions were to replace
the term ‘‘disqualified’’ in part 200 with
‘‘not qualified,’’ to remove any potential
for confusion with that term as it is used
and defined in 2 CFR part 180.
Comment: Two Federal awarding
agencies and an association of health
care centers raised questions and
concerns about due process. The
association expressed concern that: (1)
A Federal awarding agency that
determines that a non-Federal entity
was not qualified for an award was not
required to tell the non-Federal entity
why it was not qualified; and (2) the
identification of the non-Federal entity
in designated integrity and performance
system as a result of that determination
could prevent it from receiving any
Federal funding for five years. One
Federal awarding agency asked if there
was a process by which a non-Federal
entity could appeal a Federal awarding
agency’s determination that it was not
qualified for a Federal award, and the
association and other Federal awarding
agency recommended there be one.
Response: We agree in part. With
respect to the first concern, we added a
requirement in 2 CFR 200.212 for a
Federal awarding agency to provide an
explanation in the notification to a nonFederal entity about the determination
that the non-Federal entity is not
qualified for a Federal award.
With respect to the second concern
that information in the designated
integrity and performance system about
a non-Federal entity could prevent it
from receiving any Federal funding, we
note that a Federal awarding agency’s
determination that a non-Federal entity
is not qualified is related to a specific
award that is being contemplated. As
explained more fully in the response to
the previous comment, that
determination does not preclude the
making of a different Federal award to
the non-Federal entity. We revised the
wording in multiple places in part 200
to clarify that connection with a specific
Federal award.
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On the matter of appeals of a Federal
awarding agency’s determination that a
non-Federal entity is not qualified for a
Federal award, we did not revise the
guidance to require delay of individual
Federal awards, to allow an opportunity
for appeal after the Federal awarding
agency makes the determination. A
govermentwide requirement is
impractical in light of the constraints
under which many Federal programs
operate, with firm schedules for
program execution that are impelled by
statute or needs for timely obligation of
appropriated funds. Individual Federal
awarding agencies may, if timing
constraints for their programs permit,
offer an opportunity for appeal or
additional input to the Federal awarding
agency prior to award. Also note that
the commenters’ concern should be
addressed by the opportunities provided
for the non-Federal entity’s input.
Sections 200.212 and 200.340 require
Federal awarding agencies to notify
non-Federal entities when information
that may be used when Federal
awarding agencies are making future
funding decisions is entered into the
designated performance and integrity
system. Non-Federal entities whose
information is entered will have the
opportunity to comment on information
included in the system.
We anticipate that Federal agencies’
and recipients’ current apprehension
about the use of the designated integrity
and performance system will abate over
time, as they gain practical experience
with the system and associated
requirements. If lessons learned from
the use of the designated integrity and
performance system warrant further
improvements to the system or
clarifications to the guidance, we will
carefully evaluate the existing guidance
and revise the guidance, as appropriate.
Comment: Two Federal awarding
agencies commented on the
requirements in the proposed section
35.120 for a Federal awarding official to
check SAM (formerly EPLS) and the
designated integrity and performance
system. One agency stated that it was
important that Federal awarding
agencies be required to check SAM
(formerly EPLS) separately, as the
designated integrity and performance
system would not provide all of the
information they required concerning
non-Federal entities that were debarred,
suspended, or otherwise excluded or
disqualified from participation in
covered Federal transactions. The other
Federal awarding agency recommended
including a table to make clear the
different dollar thresholds for use of the
two systems—SAM (formerly EPLS)
must be checked before making any
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Federal covered transaction, regardless
of award amount, while the requirement
to check the designated integrity and
performance system applies to a Federal
award with a total value expected to
exceed the simplified acquisition
threshold.
Response: We agree in part and plan
to provide further clarification to
Federal awarding agencies regarding the
relationship between various
governmentwide systems. As discussed
earlier in the preamble, GSA plans to
integrate the designated integrity and
performance system (currently FAPIIS)
into SAM, so including a detailed chart
in the final guidance outlining when a
Federal awarding agency is required to
check specific systems is not
appropriate as the chart may become
obsolete. Although a Federal awarding
agency searching the current designated
integrity and performance system about
a potential recipient entity may receive
information in response to the search, as
well as information from other data
systems accessed through the system,
the current design does not ensure that
the awarding official receives all the
SAM information that he or she needs.
For instance, FAPIIS does not reflect
whether a non-Federal entity has an
active SAM registration as required by
2 CFR part 25. As the commenters note,
the awarding official also must check
SAM Exclusions as required by 2 CFR
part 180 prior to making a Federal
award for an amount below the dollar
threshold at which he or she is required
to check the designated integrity and
performance system. Therefore, it is
imperative that a Federal awarding
agency separately checks SAM prior to
making an award at this time.
Comment: A Federal awarding agency
noted the requirement in the proposed
paragraph 35.120(a)(3)(ii) for a Federal
awarding agency to check the SAM
Exclusions (formerly EPLS) for potential
subaward recipients if Federal approval
of those subrecipients was required
under the terms and conditions of the
Federal award. It asked if a prime
recipient was required to check the
designated integrity and performance
system for information about a nonFederal entity to which it intended to
make a subaward.
Response: If the terms and conditions
of the Federal award require the
recipient to obtain Federal awarding
agency approval of subawardees, the
Federal awarding agency must check
SAM Exclusions to verify whether a
proposed subrecipient is debarred,
suspended, or otherwise disqualified
from the subaward. In addition, a
recipient is always required under
existing policy (2 CFR 180.300) to verify
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that a non-Federal entity to which it
intends to make a subaward is not
excluded or disqualified from the
transaction, whether or not Federal
awarding agency approval of the
subrecipient is required. Unlike a
Federal awarding agency, however, 2
CFR 180.300 allows recipients multiple
ways in which it can do the verification,
checking SAM Exclusions being just one
of those ways. While only Federal
awarding agencies are required to
consider information available through
the designated integrity and
performance system for awards
expected to exceed the simplified
acquisition threshold, a recipient and
the general public are also able to check
the system for information in doing
checks of subrecipients.
Comment: A State agency, noting the
same requirement in the proposed
paragraph 35.120(a)(3)(ii) to check SAM
(formerly EPLS), asked how the process
works if a recipient does not know the
identity of all subrecipients at the time
it receives a Federal award. It asked if
the Federal award includes a term
requiring verification of subrecipients
and whether that delays the making of
subawards.
Response: The requirement stated in
the proposed guidance is not reflected
in the final guidance at 2 CFR part 200;
however, this requirement is not new.
The existing policy located at 2 CFR
180.425, states that a Federal awarding
agency must check SAM Exclusions for
potential subrecipients if its approval of
the subrecipients is required. When that
approval is required, the Federal
awarding agency can check SAM
Exclusions after the prime award is
made if the subrecipients’ identities are
not known until then.
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F. Comments on Proposed Amendments
to the Nonprocurement Suspension and
Debarment Guidance in 2 CFR Part 180
Comment: One Federal awarding
agency recommended revising 2 CFR
180.520 to require suspending and
debarring officials to enter information
into SAM Exclusions (formerly EPLS)
within three working days of taking a
suspension or debarment action, a
reduction from the current five days.
The Federal awarding agency noted that
this change was made in the FAR, in 48
CFR 9.404, as part of the
implementation of the FAPIIS
requirements for procurement contracts.
Response: We agree. We made the
recommended change and similarly
revised 2 CFR 180.655, to establish a
three-day time period for suspending
and debarring officials to report
information about administrative
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agreements to the designated integrity
and performance system.
Comment: Two Federal agencies
suggested revising the requirement in
the proposed section 2 CFR 180.655 for
a Federal suspending or debarring
official to report information to the
designated integrity and performance
system about each administrative
agreement into which the Federal
Government enters with a non-Federal
entity in lieu of a suspension or
debarment. One Federal awarding
agency recommended delaying the
effective date of the requirement until a
planned update to the designated
integrity and performance system added
the capability to accept information
about administrative agreements. The
other Federal awarding agency
suggested adding a requirement for
reporting any modifications of
administrative agreements to the
designated integrity and performance
system.
Response: We agree and have made
changes in sections 2 CFR 180.655 and
180.660 that are responsive to the
recommendations. In October 2010, the
designated integrity and performance
system gained the capability to accept
information about administrative
agreements. The system specifies the
information that must be reported.
Comment: A Federal awarding agency
recommended deleting the requirement
in the proposed section 2 CFR 180.660
for a Federal suspending or debarring
official to include information about the
designated integrity and performance
system in each administrative
agreement into which he or she enters
with a non-Federal entity in lieu of a
suspension or debarment action. The
Federal awarding agency stated that the
express purpose of an administrative
agreement is to preserve the non-Federal
entity’s eligibility to receive a Federal
award. It added that the notice of
funding opportunities under which
Federal awards are made are the
appropriate places to inform the nonFederal entity about Federal awarding
agency’s consideration of information
that they receive through the designated
integrity and performance system,
including information about
administrative agreements.
Response: We agree. We removed the
proposed section 180.660 from the final
guidance. Due to the removal of section
180.660, section 180.665 of the guidance
proposed in the February 2010 Federal
Register notice has been designated as
section 180.660 in the final guidance.
Comment: The same Federal awarding
agency recommended deleting the
requirements in the proposed
paragraphs 2 CFR 180.715(h) and
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43307
180.870(b)(2)(v) for a Federal
suspending or debarring official to
include information about the
designated integrity and performance
system in each notice of a suspension or
debarment action. The Federal awarding
agency noted that each notice already
informs the suspended or debarred
entity that the action results in its being
listed in SAM Exclusions (formerly
EPLS), with the mandatory effect of
excluding it from covered transactions.
The Federal awarding agency further
noted that the availability of the
information to a Federal awarding
agency through the designated integrity
and performance system, in addition to
SAM, does not alter that mandatory
effect. It suggested that adding
information about designated integrity
and performance system to the notice of
suspension or debarment therefore
could only confuse the matter.
Response: We agree. We removed the
proposed amendments to sections
180.715 and 180.870 from the final
guidance.
III. Next Steps
This final guidance is effective for
Federal awards issued on or after
January 1, 2016 that meet the thresholds
as described in the preamble and to
existing awards that are terminated on
or after January 1, 2016 due to material
failure to comply with the Federal
award terms and conditions. Federal
awarding agencies that have formally
adopted 2 CFR parts 180 and 200 in
their entirety in 2 CFR will begin
implementing this final guidance on
January 1, 2016. Federal awarding
agencies who adopted 2 CFR parts 180
and 200 through another means must
work with OMB to ensure their
regulations or policies are updated
effective January 1, 2016. OMB will
collaborate with GSA to ensure that the
user guides and other guidance
materials regarding the designated
integrity and performance system are
updated to reflect use by the Federal
assistance community. Applicants and
recipients will see the agencies’
implementation reflected in
requirements identified in notice of
funding opportunities or other agency
releases with application instructions,
as well as in the new award term and
condition in Appendix XII to 2 CFR part
200.
List of Subjects
2 CFR Part 180
Administrative practice and
procedure, Debarment and suspension,
Grant programs, Loan programs,
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Reporting and recordkeeping
requirements.
■
5. Add § 180.660 to subpart F to read
as follows:
2 CFR Part 200
Accounting, Auditing, Colleges and
universities, State and local
governments, Grant programs, Grants
administration, Hospitals, Indians,
Nonprofit organizations, Reporting and
recordkeeping requirements.
§ 180.660 Will administrative agreement
information about me in the designated
integrity and performance system
accessible through SAM be corrected or
updated?
David Mader,
Controller.
For the reasons stated in the preamble
and under the authority of the Chief
Financial Officer Act of 1990 (31 U.S.C.
503), the Office of Management and
Budget amends 2 CFR parts 180 and 200
as set forth below:
TITLE 2—GRANTS AND
AGREEMENTS
Chapter I—Office of Management and
Budget Governmentwide Guidance for
Grants and Agreements
PART 180—OMB GUIDELINES TO
AGENCIES ON GOVERNMENTWIDE
DEBARMENT AND SUSPENSION
(NONPROCUREMENT)
1. The authority citation for part 180
continues to read as follows:
■
Authority: Sec. 2455, Pub. L. 103–355, 108
Stat. 3327; E.O. 12549, 3 CFR, 1986 Comp.,
p. 189; E.O. 12689, 3 CFR, 1989 Comp., p.
235.
§ 180.520
Yes, the suspending or debarring
official who entered information into
the designated integrity and
performance system about an
administrative agreement with you:
(a) Must correct the information
within three business days if he or she
subsequently learns that any of the
information is erroneous.
(b) Must correct in the designated
integrity and performance system,
within three business days, the ending
date of the period during which the
agreement is in effect, if the agreement
is amended to extend that period.
(c) Must report to the designated
integrity and performance system,
within three business days, any other
modification to the administrative
agreement.
(d) Is strongly encouraged to amend
the information in the designated
integrity and performance system in a
timely way to incorporate any update
that he or she obtains that could be
helpful to Federal awarding agencies
who must use the system.
Chapter II—Office of Management and
Budget Guidance
[Amended]
2. Amend § 180.520(c) introductory
text by removing the words ‘‘generally
within five working days,’’ and adding
in their place ‘‘within three business
days,’’.
■ 3. Add § 180.650 to subpart F to read
as follows:
■
PART 200—UNIFORM
ADMINISTRATIVE REQUIREMENTS,
COST PRINCIPLES, AND AUDIT
REQUIREMENTS FOR FEDERAL
AWARDS
6. The authority citation for part 200
continues to read as follows:
■
Authority: 31 U.S.C. 503.
§ 180.650 May an administrative
agreement be the result of a settlement?
§ 200.0
§ 180.655 How will other Federal awarding
agencies know about an administrative
agreement that is the result of a settlement?
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Yes, a Federal agency may enter into
an administrative agreement with you as
part of the settlement of a debarment or
suspension action.
■ 4. Add § 180.655 to subpart F to read
as follows:
The non-Federal entity or applicant
for a Federal award must disclose, in a
timely manner, in writing to the Federal
awarding agency or pass-through entity
all violations of Federal criminal law
involving fraud, bribery, or gratuity
violations potentially affecting the
Federal award. Non-Federal entities that
have received a Federal award including
the term and condition outlined in
Appendix XII—Award Term and
Condition for Recipient Integrity and
Performance Matters are required to
report certain civil, criminal, or
The suspending or debarring official
who enters into an administrative
agreement with you must report
information about the agreement to the
designated integrity and performance
system within three business days after
entering into the agreement. This
information is required by section 872
of the Duncan Hunter National Defense
Authorization Act for Fiscal Year 2009
(41 U.S.C. 2313).
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[Amended]
7. Amend § 200.0 by adding
‘‘(accessible at https://www.sam.gov)’’
after ‘‘System for Award Management’’.
■ 8. Revise § 200.113 to read as follows:
■
§ 200.113
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administrative proceedings to SAM.
Failure to make required disclosures can
result in any of the remedies described
in § 200.338 Remedies for
noncompliance, including suspension
or debarment. (See also 2 CFR part 180,
31 U.S.C. 3321, and 41 U.S.C. 2313.)
§ 200.203
[Amended]
9. Amend § 200.203 paragraph (c)(5)
by removing ‘‘See also 2 CFR part 27
(forthcoming at time of publication).’’
■ 10. Revise § 200.205 paragraph (a) to
read as follows:
■
§ 200.205 Federal awarding agency review
of risk posed by applicants.
(a) Review of OMB-designated
repositories of govermentwide data. (1)
Prior to making a Federal award, the
Federal awarding agency is required by
31 U.S.C. 3321 and 41 U.S.C. 2313 note
to review information available through
any OMB-designated repositories of
governmentwide eligibility qualification
or financial integrity information as
appropriate. See also suspension and
debarment requirements at 2 CFR part
180 as well as individual Federal agency
suspension and debarment regulations
in title 2 of the Code of Federal
Regulations.
(2) In accordance 41 U.S.C. 2313, the
Federal awarding agency is required to
review the publicly available
information in the OMB-designated
integrity and performance system
accessible through SAM (currently the
Federal Awardee Performance and
Integrity Information System (FAPIIS))
prior to making a Federal award where
the Federal share is expected to exceed
the simplified acquisition threshold,
defined in 41 U.S.C. 134, over the
period of performance. At a minimum,
the information in the system for a prior
Federal award recipient must
demonstrate a satisfactory record of
executing programs or activities under
Federal grants, cooperative agreements,
or procurement awards; and integrity
and business ethics. The Federal
awarding agency may make a Federal
award to a recipient who does not fully
meet these standards, if it is determined
that the information is not relevant to
the current Federal award under
consideration or there are specific
conditions that can appropriately
mitigate the effects of the non-Federal
entity’s risk in accordance with
§ 200.207 Specific conditions.
*
*
*
*
*
■ 11. In § 200.210, add paragraph
(b)(1)(iii) to read as follows:
§ 200.210 Information contained in a
Federal award.
*
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(b) * * *
(1) * * *
(iii) Recipient integrity and
performance matters. If the total Federal
share of the Federal award may include
more than $500,000 over the period of
performance, the Federal awarding
agency must include the term and
condition available in Appendix XII—
Award Term and Condition for
Recipient Integrity and Performance
Matters. See also § 200.113 Mandatory
disclosures.
*
*
*
*
*
■ 12. In § 200.211, revise paragraph (b)
and add paragraph (c) to read as follows:
§ 200.211 Public access to Federal award
information.
*
*
*
*
*
(b) All information posted in the
designated integrity and performance
system accessible through SAM
(currently FAPIIS) on or after April 15,
2011 will be publicly available after a
waiting period of 14 calendar days,
except for:
(1) Past performance reviews required
by Federal Government contractors in
accordance with the Federal Acquisition
Regulation (FAR) 42.15;
(2) Information that was entered prior
to April 15, 2011; or
(3) Information that is withdrawn
during the 14-calendar day waiting
period by the Federal Government
official.
(c) Nothing in this section may be
construed as requiring the publication
of information otherwise exempt under
the Freedom of Information Act (5 U.S.C
552), or controlled unclassified
information pursuant to Executive
Order 13556.
■ 13. Revise § 200.212 to read as
follows:
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§ 200.212 Reporting a determination that a
non-Federal entity is not qualified for a
Federal award.
(a) If a Federal awarding agency does
not make a Federal award to a nonFederal entity because the official
determines that the non-Federal entity
does not meet either or both of the
minimum qualification standards as
described in § 200.205, Federal
awarding agency review of risk posed by
applicants, paragraph (a)(2), the Federal
awarding agency must report that
determination to the designated
integrity and performance system
accessible through SAM (currently
FAPIIS), only if all of the following
apply:
(1) The only basis for the
determination described in paragraph
(a) of this section is the non-Federal
entity’s prior record of executing
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programs or activities under Federal
awards or its record of integrity and
business ethics, as described in
§ 200.205 Federal awarding agency
review of risk posed by applicants,
paragraph (a)(2) (i.e., the entity was
determined to be qualified based on all
factors other than those two standards),
and
(2) The total Federal share of the
Federal award that otherwise would be
made to the non-Federal entity is
expected to exceed the simplified
acquisition threshold over the period of
performance.
(b) The Federal awarding agency is
not required to report a determination
that a non-Federal entity is not qualified
for a Federal award if they make the
Federal award to the non-Federal entity
and includes specific award terms and
conditions, as described in § 200.207
Specific conditions.
(c) If a Federal awarding agency
reports a determination that a nonFederal entity is not qualified for a
Federal award, as described in
paragraph (a) of this section, the Federal
awarding agency also must notify the
non-Federal entity that—
(1) The determination was made and
reported to the designated integrity and
performance system accessible through
SAM, and include with the notification
an explanation of the basis for the
determination;
(2) The information will be kept in the
system for a period of five years from
the date of the determination, as
required by section 872 of Public Law
110–417, as amended (41 U.S.C. 2313),
then archived;
(3) Each Federal awarding agency that
considers making a Federal award to the
non-Federal entity during that five year
period must consider that information
in judging whether the non-Federal
entity is qualified to receive the Federal
award when the total Federal share of
the Federal award is expected to include
an amount of Federal funding in excess
of the simplified acquisition threshold
over the period of performance;
(4) The non-Federal entity may go to
the awardee integrity and performance
portal accessible through SAM
(currently the Contractor Performance
Assessment Reporting System (CPARS))
and comment on any information the
system contains about the non-Federal
entity itself; and
(5) Federal awarding agencies will
consider that non-Federal entity’s
comments in determining whether the
non-Federal entity is qualified for a
future Federal award.
(d) If a Federal awarding agency
enters information into the designated
integrity and performance system
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43309
accessible through SAM about a
determination that a non-Federal entity
is not qualified for a Federal award and
subsequently:
(1) Learns that any of that information
is erroneous, the Federal awarding
agency must correct the information in
the system within three business days;
(2) Obtains an update to that
information that could be helpful to
other Federal awarding agencies, the
Federal awarding agency is strongly
encouraged to amend the information in
the system to incorporate the update in
a timely way.
(e) Federal awarding agencies shall
not post any information that will be
made publicly available in the nonpublic segment of designated integrity
and performance system that is covered
by a disclosure exemption under the
Freedom of Information Act. If the
recipient asserts within seven calendar
days to the Federal awarding agency
that posted the information that some or
all of the information made publicly
available is covered by a disclosure
exemption under the Freedom of
Information Act, the Federal awarding
agency that posted the information must
remove the posting within seven
calendar days of receiving the assertion.
Prior to reposting the releasable
information, the Federal awarding
agency must resolve the issue in
accordance with the agency’s Freedom
of Information Act procedures.
■ 14. Add § 200.213 to subpart C to read
as follows:
§ 200.213
Suspension and debarment.
Non-federal entities are subject to the
non-procurement debarment and
suspension regulations implementing
Executive Orders 12549 and 12689, 2
CFR part 180. These regulations restrict
awards, subawards, and contracts with
certain parties that are debarred,
suspended, or otherwise excluded from
or ineligible for participation in Federal
assistance programs or activities.
§ 200.300
[Amended]
15. Amend § 200.300 paragraph (b) by
removing ‘‘Central Contractor
Registration’’ and adding in its place
‘‘System for Award Management’’.
■
§ 200.318
[Amended]
16. Amend § 200.318 paragraph (h) by
removing ‘‘§ 200.212’’ and adding in its
place ‘‘§ 200.213’’.
■ 17. In § 200.339, revise paragraph (b)
and add paragraph (c) to read as follows:
■
§ 200.339
Termination.
*
*
*
*
*
(b) When a Federal awarding agency
terminates a Federal award prior to the
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Federal Register / Vol. 80, No. 140 / Wednesday, July 22, 2015 / Rules and Regulations
end of the period of performance due to
the non-Federal entity’s material failure
to comply with the Federal award terms
and conditions, the Federal awarding
agency must report the termination to
the OMB-designated integrity and
performance system accessible through
SAM (currently FAPIIS).
(1) The information required under
paragraph (b) of this section is not to be
reported to designated integrity and
performance system until the nonFederal entity either—
(i) Has exhausted its opportunities to
object or challenge the decision, see
§ 200.341 Opportunities to object,
hearings and appeals; or
(ii) Has not, within 30 calendar days
after being notified of the termination,
informed the Federal awarding agency
that it intends to appeal the Federal
awarding agency’s decision to
terminate.
(2) If a Federal awarding agency, after
entering information into the designated
integrity and performance system about
a termination, subsequently:
(i) Learns that any of that information
is erroneous, the Federal awarding
agency must correct the information in
the system within three business days;
(ii) Obtains an update to that
information that could be helpful to
other Federal awarding agencies, the
Federal awarding agency is strongly
encouraged to amend the information in
the system to incorporate the update in
a timely way.
(3) Federal awarding agencies, shall
not post any information that will be
made publicly available in the nonpublic segment of designated integrity
and performance system that is covered
by a disclosure exemption under the
Freedom of Information Act. If the nonFederal entity asserts within seven
calendar days to the Federal awarding
agency who posted the information, that
some of the information made publicly
available is covered by a disclosure
exemption under the Freedom of
Information Act, the Federal awarding
agency who posted the information
must remove the posting within seven
calendar days of receiving the assertion.
Prior to reposting the releasable
information, the Federal agency must
resolve the issue in accordance with the
agency’s Freedom of Information Act
procedures.
(c) When a Federal award is
terminated or partially terminated, both
the Federal awarding agency or passthrough entity and the non-Federal
entity remain responsible for
compliance with the requirements in
§§ 200.343 Closeout and 200.344 Postcloseout adjustments and continuing
responsibilities.
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15:06 Jul 21, 2015
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18. Revise § 200.340, paragraph (b) to
read as follows:
■
§ 200.340 Notification of termination
requirement.
*
*
*
*
*
(b) If the Federal award is terminated
for the non-Federal entity’s material
failure to comply with the Federal
statutes, regulations, or terms and
conditions of the Federal award, the
notification must state that—
(1) The termination decision will be
reported to the OMB-designated
integrity and performance system
accessible through SAM (currently
FAPIIS);
(2) The information will be available
in the OMB-designated integrity and
performance system for a period of five
years from the date of the termination,
then archived;
(3) Federal awarding agencies that
consider making a Federal award to the
non-Federal entity during that five year
period must consider that information
in judging whether the non-Federal
entity is qualified to receive the Federal
award, when the Federal share of the
Federal award is expected to exceed the
simplified acquisition threshold over
the period of performance;
(4) The non-Federal entity may
comment on any information the OMBdesignated integrity and performance
system contains about the non-Federal
entity for future consideration by
Federal awarding agencies. The nonFederal entity may submit comments to
the awardee integrity and performance
portal accessible through SAM
(currently (CPARS).
(5) Federal awarding agencies will
consider non-Federal entity comments
when determining whether the nonFederal entity is qualified for a future
Federal award.
*
*
*
*
*
■ 19. In Appendix I to Part 200, revise
paragraph E.3., add paragraph E.4., and
revise paragraph F.3. to read as follows:
Appendix I to Part 200—Full Text of
Notice of Funding Opportunity
*
*
*
*
*
E. * * *
3. For any Federal award under a notice of
funding opportunity, if the Federal awarding
agency anticipates that the total Federal share
will be greater than the simplified acquisition
threshold on any Federal award under a
notice of funding opportunity may include,
over the period of performance (see § 200.88
Simplified Acquisition Threshold), this
section must also inform applicants:
i. That the Federal awarding agency, prior
to making a Federal award with a total
amount of Federal share greater than the
simplified acquisition threshold, is required
to review and consider any information about
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the applicant that is in the designated
integrity and performance system accessible
through SAM (currently FAPIIS) (see 41
U.S.C. 2313);
ii. That an applicant, at its option, may
review information in the designated
integrity and performance systems accessible
through SAM and comment on any
information about itself that a Federal
awarding agency previously entered and is
currently in the designated integrity and
performance system accessible through SAM;
iii. That the Federal awarding agency will
consider any comments by the applicant, in
addition to the other information in the
designated integrity and performance system,
in making a judgment about the applicant’s
integrity, business ethics, and record of
performance under Federal awards when
completing the review of risk posed by
applicants as described in § 200.205 Federal
awarding agency review of risk posed by
applicants.
4. Anticipated Announcement and Federal
Award Dates—Optional. This section is
intended to provide applicants with
information they can use for planning
purposes. If there is a single application
deadline followed by the simultaneous
review of all applications, the Federal
awarding agency can include in this section
information about the anticipated dates for
announcing or notifying successful and
unsuccessful applicants and for having
Federal awards in place. If applications are
received and evaluated on a ‘‘rolling’’ basis
at different times during an extended period,
it may be appropriate to give applicants an
estimate of the time needed to process an
application and notify the applicant of the
Federal awarding agency’s decision.
F. * * *
3. Reporting—Required. This section must
include general information about the type
(e.g., financial or performance), frequency,
and means of submission (paper or
electronic) of post-Federal award reporting
requirements. Highlight any special reporting
requirements for Federal awards under this
funding opportunity that differ (e.g., by
report type, frequency, form/format, or
circumstances for use) from what the Federal
awarding agency’s Federal awards usually
require. Federal awarding agencies must also
describe in this section all relevant
requirements such as those at 2 CFR 180.335
and 2 CFR 180.350.
If the Federal share of any Federal award
may include more than $500,000 over the
period of performance, this section must
inform potential applicants about the post
award reporting requirements reflected in
Appendix XII—Award Term and Condition
for Recipient Integrity and Performance
Matters.
*
*
*
*
*
20. Add Appendix XII to Part 200 to
read as follows:
■
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Federal Register / Vol. 80, No. 140 / Wednesday, July 22, 2015 / Rules and Regulations
Appendix XII to Part 200—Award
Term and Condition for Recipient
Integrity and Performance Matters
A. Reporting of Matters Related to Recipient
Integrity and Performance
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1. General Reporting Requirement
If the total value of your currently active
grants, cooperative agreements, and
procurement contracts from all Federal
awarding agencies exceeds $10,000,000 for
any period of time during the period of
performance of this Federal award, then you
as the recipient during that period of time
must maintain the currency of information
reported to the System for Award
Management (SAM) that is made available in
the designated integrity and performance
system (currently the Federal Awardee
Performance and Integrity Information
System (FAPIIS)) about civil, criminal, or
administrative proceedings described in
paragraph 2 of this award term and
condition. This is a statutory requirement
under section 872 of Public Law 110–417, as
amended (41 U.S.C. 2313). As required by
section 3010 of Public Law 111–212, all
information posted in the designated
integrity and performance system on or after
April 15, 2011, except past performance
reviews required for Federal procurement
contracts, will be publicly available.
2. Proceedings About Which You Must
Report
Submit the information required about
each proceeding that:
a. Is in connection with the award or
performance of a grant, cooperative
agreement, or procurement contract from the
Federal Government;
b. Reached its final disposition during the
most recent five year period; and
c. Is one of the following:
(1) A criminal proceeding that resulted in
a conviction, as defined in paragraph 5 of
this award term and condition;
(2) A civil proceeding that resulted in a
finding of fault and liability and payment of
a monetary fine, penalty, reimbursement,
restitution, or damages of $5,000 or more;
(3) An administrative proceeding, as
defined in paragraph 5. of this award term
and condition, that resulted in a finding of
fault and liability and your payment of either
a monetary fine or penalty of $5,000 or more
or reimbursement, restitution, or damages in
excess of $100,000; or
(4) Any other criminal, civil, or
administrative proceeding if:
(i) It could have led to an outcome
described in paragraph 2.c.(1), (2), or (3) of
this award term and condition;
(ii) It had a different disposition arrived at
by consent or compromise with an
acknowledgment of fault on your part; and
(iii) The requirement in this award term
and condition to disclose information about
the proceeding does not conflict with
applicable laws and regulations.
3. Reporting Procedures
Enter in the SAM Entity Management area
the information that SAM requires about
each proceeding described in paragraph 2 of
this award term and condition. You do not
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15:06 Jul 21, 2015
Jkt 235001
need to submit the information a second time
under assistance awards that you received if
you already provided the information
through SAM because you were required to
do so under Federal procurement contracts
that you were awarded.
4. Reporting Frequency
During any period of time when you are
subject to the requirement in paragraph 1 of
this award term and condition, you must
report proceedings information through SAM
for the most recent five year period, either to
report new information about any
proceeding(s) that you have not reported
previously or affirm that there is no new
information to report. Recipients that have
Federal contract, grant, and cooperative
agreement awards with a cumulative total
value greater than $10,000,000 must disclose
semiannually any information about the
criminal, civil, and administrative
proceedings.
5. Definitions
For purposes of this award term and
condition:
a. Administrative proceeding means a nonjudicial process that is adjudicatory in nature
in order to make a determination of fault or
liability (e.g., Securities and Exchange
Commission Administrative proceedings,
Civilian Board of Contract Appeals
proceedings, and Armed Services Board of
Contract Appeals proceedings). This includes
proceedings at the Federal and State level but
only in connection with performance of a
Federal contract or grant. It does not include
audits, site visits, corrective plans, or
inspection of deliverables.
b. Conviction, for purposes of this award
term and condition, means a judgment or
conviction of a criminal offense by any court
of competent jurisdiction, whether entered
upon a verdict or a plea, and includes a
conviction entered upon a plea of nolo
contendere.
c. Total value of currently active grants,
cooperative agreements, and procurement
contracts includes—
(1) Only the Federal share of the funding
under any Federal award with a recipient
cost share or match; and
(2) The value of all expected funding
increments under a Federal award and
options, even if not yet exercised.
B. [Reserved]
[FR Doc. 2015–17753 Filed 7–21–15; 8:45 am]
BILLING CODE P
DEPARTMENT OF TRANSPORTATION
Federal Aviation Administration
14 CFR Part 71
[Docket No. FAA–2014–0565; Airspace
Docket No. 14–ACE–7]
Revocation of Class D and E Airspace;
Independence, KS
Federal Aviation
Administration (FAA), DOT.
AGENCY:
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Fmt 4700
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ACTION:
43311
Final rule.
This action removes Class D
airspace and the associated Class E
surface area airspace at Independence
Municipal Airport, Independence, KS.
Closure of the airport’s air traffic control
tower has necessitated the need for this
action.
DATES: Effective 0901 UTC, October 15,
2015. The Director of the Federal
Register approves this incorporation by
reference action under title 1, Code of
Federal Regulations, part 51, subject to
the annual revision of FAA Order
7400.9 and publication of conforming
amendments.
SUMMARY:
FAA Order 7400.9Y,
Airspace Designations and Reporting
Points, and subsequent amendments can
be viewed on line at https://
www.faa.gov/airtraffic/publications/.
The Order is also available for
inspection at the National Archives and
Records Administration (NARA). For
information on the availability of this
material at NARA, call 202–741–6030,
or go to https://www.archives.gov/
federal_register/code_of_federalregulations/ibr_locations.html.
FAA Order 7400.9, Airspace
Designations and Reporting Points, is
published yearly and effective on
September 15. For further information,
you can contact the Airspace Policy and
ATC Regulations Group, Federal
Aviation Administration, 800
Independence Avenue SW.,
Washington, DC 29591; telephone: 202–
267–8783.
FOR FURTHER INFORMATION CONTACT: Raul
Garza, Jr., Central Service Center,
Operations Support Group, Federal
Aviation Administration, Southwest
Region, 2601 Meacham Blvd., Fort
Worth, TX 76137; telephone: 817–222–
4075.
SUPPLEMENTARY INFORMATION:
ADDRESSES:
Authority for This Rulemaking
The FAA’s authority to issue rules
regarding aviation safety is found in
Title 49 of the United States Code.
Subtitle I, Section 106 describes the
authority of the FAA Administrator.
Subtitle VII, Aviation Programs,
describes in more detail the scope of the
agency’s authority. This rulemaking is
promulgated under the authority
described in Subtitle VII, Part, A,
Subpart I, Section 40103. Under that
section, the FAA is charged with
prescribing regulations to assign the use
of airspace necessary to ensure the
safety of aircraft and the efficient use of
airspace. This regulation is within the
scope of that authority as it removes
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Agencies
[Federal Register Volume 80, Number 140 (Wednesday, July 22, 2015)]
[Rules and Regulations]
[Pages 43301-43311]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-17753]
========================================================================
Rules and Regulations
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains regulatory documents
having general applicability and legal effect, most of which are keyed
to and codified in the Code of Federal Regulations, which is published
under 50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by the Superintendent of Documents.
Prices of new books are listed in the first FEDERAL REGISTER issue of each
week.
========================================================================
Federal Register / Vol. 80, No. 140 / Wednesday, July 22, 2015 /
Rules and Regulations
[[Page 43301]]
OFFICE OF MANAGEMENT AND BUDGET
2 CFR Parts 180 and 200
Guidance for Reporting and Use of Information Concerning
Recipient Integrity and Performance
AGENCY: Executive Office of the President, Office of Management and
Budget.
ACTION: Final guidance.
-----------------------------------------------------------------------
SUMMARY: The Office of Management and Budget (OMB) is issuing final
guidance to Federal agencies to implement Section 872 of the Duncan
Hunter National Defense Authorization Act for Fiscal Year 2009
(hereafter referred to as ``section 872''), as that statute applies to
grants. As section 872 required, OMB and the General Services
Administration (GSA) have established an integrity and performance
system that includes governmentwide data with specified information
related to the integrity and performance of entities awarded Federal
grants and contracts. This system, currently designated as the Federal
Awardee Performance and Integrity Information System (FAPIIS),
integrates various sources of information on the eligibility of
organizations for Government awards and is currently available at
https://www.fapiis.gov.
This final guidance implements section 872's requirements for
recipients and Federal awarding agencies to report information that
will appear in the OMB-designated integrity and performance system and
for Federal awarding agencies to consider information the system
contains about a non-Federal entity before awarding a grant to that
non-Federal entity. The final guidance for grants, which also applies
to cooperative agreements, also addresses how the designated integrity
and performance system and other information may be used in assessing
recipient integrity.
DATES: This guidance is effective January 1, 2016.
FOR FURTHER INFORMATION CONTACT: Rhea Hubbard, Office of Federal
Financial Management, Office of Management and Budget,
rhubbard@omb.eop.gov, telephone (202) 395-2743.
SUPPLEMENTARY INFORMATION:
I. Background
A. This final guidance to Federal agencies implement Sections 872
of the Duncan Hunter National Defense Authorization Act for Fiscal Year
2009 (Pub. L. 110-417, codified as amended at 41 U.S.C. 2313).
On February 18, 2010 (75 FR 7316), the Office of Management and
Budget (OMB) proposed a number of changes to Title 2 of the Code of
Federal Regulations (2 CFR). Since publication of the February 2010
Federal Register notice, OMB finalized the portion of the guidance at 2
CFR part 25, which includes requirements for obtaining a Universal
Identifier and registering in the System for Award Management (SAM)
formerly called the Central Contractor Registration system (CCR) in the
Federal Register on September 14, 2010 [75 FR 55671]. Part 25 was
expedited and finalized separately from the guidance being issued today
because it was needed to support reporting of subawards made on or
after October 1, 2010, as the next step in implementation of the
Federal Funding Accountability and Transparency Act (``Transparency
Act,'' Pub. L. 109-282, as amended). The preamble of the Federal
Register notice that finalized 2 CFR part 25 included responses to the
public comments that we received on the proposed requirements related
to DUNS numbers and CCR (which subsequently became SAM and is
accessible at https://www.sam.gov). The remainder of this notice
therefore does not address that portion of the February 2010 Federal
Register notice.
Also since publication of the February 2010 Federal Register
notice, OMB published final guidance at 2 CFR part 200 titled Uniform
Administrative Requirements, Cost Principles, and Audit Requirements
for Federal Awards on December 26, 2013 [78 FR 78589]. This final
guidance streamlined the Federal government's guidance on
Administrative Requirements, Cost Principles, and Audit Requirements
for Federal awards and provided a governmentwide framework for grants
management. Part 200 incorporated portions of the proposed guidance at
part 27 regarding notices of funding opportunities, see 2 CFR 200.203.
Therefore this notice does not address certain portions of part 27 that
were proposed in the February 2010 Federal Register notice. Further,
OMB is no longer issuing parts 27, 35, and 77 separately. The final
guidance incorporates the proposed guidance at parts 27, 35, and 77
into part 200. This approach is consistent with the intent for part 200
to serve as a governmentwide framework for grants management.
The February 2010 Federal Register notice proposed changes to
governmentwide guidance for nonprocurement debarment and suspension
remain reflected in the final guidance at 2 CFR part 180.
B. The major elements of the proposed guidance, which are addressed
in this notice, are requirements for:
Federal awarding agencies to report information to the
designated integrity and performance system about any termination of an
award due to a material failure to comply with the award terms and
conditions; any administrative agreement with a non-Federal entity to
resolve a suspension or debarment proceeding; and any finding that a
non-Federal entity is not qualified to receive a given award, if the
finding is based on criteria related to the non-Federal entity's
integrity or prior performance under Federal awards.
Recipients that have Federal contract, grant, and
cooperative agreement awards with a cumulative total value greater than
$10,000,000 to provide information to the designated integrity and
performance system about certain civil, criminal, and administrative
proceedings that reached final disposition within the most recent five
year period and that were connected with the award or performance of a
Federal award.
Recipients that have Federal contract, grant, and
cooperative agreement awards with a cumulative total value greater than
$10,000,000 are required to disclose semiannually the information about
the criminal, civil,
[[Page 43302]]
and administrative proceedings that section 872(c) describes.
Federal awarding agencies, prior to making an award to a
non-Federal entity, to determine whether that non-Federal entity is
qualified to receive that particular award. In making the
determination, the Federal awarding agency must take into consideration
any information about the entity that is in the designated integrity
and performance system.
Notice of funding opportunities and Federal award terms
and conditions to inform a non-Federal entity that it may submit
comments to the designated integrity and performance system about any
information that the Federal awarding agency had reported to the system
about the non-Federal entity, for consideration by the Federal awarding
agency in making future Federal awards to the non-Federal entity.
We received comments on these elements of the proposed guidance
from four State agencies, seven Federal agencies or agency components,
and three associations representing community health centers, academic
institutions, and industrial firms, respectively. We considered all
comments received and made some of the recommended improvements in
developing the final guidance. Some of the more significant changes are
to:
Make the guidance for grants and cooperative agreements as
consistent where practicable with the FAPIIS guidance in the Federal
Acquisition Regulation (FAR) that applies to procurement contracts (48
CFR 9.104), thereby simplifying implementation for non-Federal entities
that receive both Federal assistance and procurement awards;
provide information on the legislative amendment to
section 872, which was enacted after issuance of the proposed guidance,
that requires making certain information in the designated integrity
and performance system available to the public;
provide information that must be included in a notice of
funding opportunity regarding implementation of integrity and
performance reporting;
clarify the process that a Federal awarding agency follows
when making a determination that a non-Federal entity is qualified to
receive an award based on a review of information in the designated
integrity and performance system and other sources;
add wording to help ensure that all non-Federal entities,
including applicants under programs that do not have program
announcements, are fully aware of the potential effects of information
about them in the designated integrity and performance system and their
right to submit comments about the information; and
add a requirement that Federal awarding agencies wait 14
calendar days after posting information to the non-public segment of
the designated integrity and performance system before making the
information available through the public segment of the system to be
consistent with the acquisitions community's requirements.
Additional changes were made for clarity or completeness. For
example, the simplified acquisition threshold set by the Federal
Acquisition Regulation (FAR) at 48 CFR Subpart 2.1 (Definitions) is
periodically adjusted for inflation in accordance with 41 U.S.C. 1908
and is now set at $150,000. Consequently, we updated the threshold
citation throughout the guidance by including a reference to the
definition available at 2 CFR 200.88. Also, several of the systems
referred to in the guidance, namely the Central Contractor Registration
(CCR) and the Excluded Parties List System (EPLS), have been migrated
into SAM and no longer exist as stand-alone systems. Further, the
General Services Administration (GSA) plans to migrate the currently
designated integrity and performance system, FAPIIS, to SAM and the
language describing the system in the final guidance is designed to
accommodate future system changes. Additional system migrations to SAM
and other central portals will make it easier for agencies and
recipients to input and receive information through a central Web site.
C. The designated integrity and performance system integrates
various sources of information regarding non-Federal entities to help
Federal awarding agencies ensure that a thorough review of available
databases with relevant information on to determine whether a recipient
is qualified occurs before the issuance of Federal awards. In addition
to the designated integrity and performance system, Federal awarding
agencies are able to conduct matching to help determine qualification
for Federal awards and payments through complementary efforts, such as
the Do Not Pay working system maintained by the Department of the
Treasury. While Treasury conducts matching against the Do Not Pay
working system for all appropriate Federal payments, in accordance with
the Improper Payments Elimination and Recovery Improvement Act of 2012,
Federal awarding agencies are responsible for determining which of the
Do Not Pay databases are appropriate to review for pre-award purposes.
As required by 2 CFR part 180, Federal awarding agencies are required
to check SAM Exclusions prior to the issuance of Federal awards, which
is available directly through SAM or the Do Not Pay working system.
Federal awarding agencies are not required to check the other databases
that are part of the Do Not Pay working system for pre-award purposes
where the Federal awarding agency has determined that the designated
integrity and performance system (currently FAPIIS) and SAM provide
more relevant information to making decisions on recipient
qualification. As governmentwide systems continue to mature, there may
be opportunities for further integration between the various systems.
D. Section 872 applies without distinguishing between for-profit
and other recipients. Thus, notwithstanding 2 CFR 200.101(c) general
permissive application of subparts A through E to for-profits, agencies
must apply to for-profit recipients (in agencies' regulations,
policies, or directly through the terms and conditions of Federal
awards) the requirements reflected in this final guidance. OMB is
considering governmentwide guidance to apply consistent treatment
towards for-profit grant and cooperative agreement recipients,
including the requirements of Section 872.
E. Since publishing the proposed guidance, Section 852 of the
National Defense Authorization Act for Fiscal Year 2013 set forth
additional requirements for the designated integrity and performance
system to include, to the extent practicable, additional information on
any parent, subsidiary, or successor entities to corporations included
in the system. In order to address these additional requirements, OMB
is considering publishing proposed guidance to implement Section 852 of
the National Defense Authorization Act for Fiscal Year 2013.
II. Comments and Responses
Sections II. A through II. F of this preamble summarize the major
comments and our responses. General comments that address more than one
portion of the guidance are summarized in section II.A. Each of the
other sections addresses comments pertaining to a specific portion of
the proposed guidance.
A. General Comments
Comment: One State agency asked when GSA will establish the
specifics of the FAPIIS data system and whether the specifics will be
posted for comment.
[[Page 43303]]
Response: GSA continues to make improvements to enable the
designated integrity and performance system to collect other
information for use by Federal awarding agencies that must make
determinations concerning recipient qualifications. The public
opportunity to comment on specific information to be collected from
contractors and recipients of assistance awards is through the
Paperwork Reduction Act (PRA) clearance process. The PRA clearance for
procurement contracts was addressed in the Federal Register documents
with the FAR changes and approved under OMB Clearance Number 9000-0174.
The PRA clearance for grants and cooperative agreements was addressed
in the Federal Register documents issued October 1, 2010 [75 FR 60756],
February 11, 2011 [76 FR 7851], and July 3, 2014 [79 FR 38028].
Comment: One industry association and one university association
asked that we implement section 872 for grants in a manner that
conforms with the implementation for procurement contracts, except
where justified by the substantive differences between assistance and
procurement. Noting that their constituents receive contracts, as well
as grants, they recommended use of identical wording of any required
questions or assurances, as well as electronic entry of data through
the same system.
Response: We agree that conformity to the maximum extent
practicable is important for requirements that are common to both
recipients of grants and contractors. The award term and condition for
grants and cooperative agreements therefore requires recipients to
enter certain information through SAM, the same system that contractors
use for that purpose. A recipient and contractor must answer identical
questions in SAM and, if applicable, must provide the same information
about the types of proceedings identified in section 872.
Comment: The industry and university associations and one Federal
awarding agency responded to the invitation in the February 2010
Federal Register notice to comment on a possible expansion of the scope
of the designated integrity and performance system to ``include
recipient information from authoritative data sources not described in
this guidance.'' One association recommended we not expand the scope to
information not related to the performance of a Federal or State
contract or grant. The other strongly suggested limiting it to
information related to performance under Federal awards only. The
Federal awarding agency recommended building the system to allow for
future expansion to include data on integrity and performance
information beyond what was delineated in the proposed guidance.
Response: OMB may expand the scope of the system to include
information related to integrity and performance information beyond
what was delineated in the proposed guidance.
Comment: A university association suggested that we reaffirm that
the term ``recipient'' throughout the 2 CFR guidance proposed in the
February 2010 Federal Register notice means the organization receiving
an award, as it usually does in the assistance community, and does not
also include associated individuals. They stated that the reaffirmation
was especially important as it relates to recipient qualification
matters addressed in subpart A of the proposed 2 CFR part 35.
Response: As defined at 2 CFR 200.86, the term ``recipient'' means
``a non-Federal entity that receives a Federal award directly from a
Federal awarding agency to carry out an activity under a Federal
program.'' Thus, the term does not include individuals such as the
organization's employees or other individuals who may only be involved
in performance of the project or program under the award because those
individuals did not receive the Federal award directly from a Federal
awarding agency.
Comment: The university association also recommended that we state
in the guidance that information in the designated integrity and
performance system is not subject to disclosure in response to Freedom
of Information Act (FOIA) requests. They noted that the Federal
Register notice for the final FAR rule on section 872 stated that the
question of access to the data under FOIA would be determined on a
case-by-case basis.
Response: After publication of the proposed guidance, section 872
was amended to require public disclosure of information in designated
integrity and performance system other than past performance reviews.
Actions posted in system on or after April 15, 2011, will be available
to the public, as required by section 3010 of Public Law 111-212.
Agencies' disclosure of information should be consistent with all
applicable statutes that limit such disclosures. For example,
heightened attention should be given to whether documentation includes
information that involves privacy, security, proprietary business
interests, and law enforcement investigations. Only information posted
after April 15, 2011 will be subject to the disclosure requirements in
section 3010 of Public Law 111-212.
B. Comments on Requirements in the Proposed 2 CFR Part 27 for
Announcements of Funding Opportunities
Comment: Two Federal awarding agencies recommended we revise the
guidance in the proposed Sec. 27.210 that the form and content of
agency program announcements must adhere to those of the standard
announcement format contained in the appendix to part 27. They
recommended that we instead require agencies' announcements to comply
with a ``substantial conformance'' standard that would provide greater
flexibility. The agencies were particularly concerned about the wording
in Section II of Subdivision 1 of the announcement format stating that
agencies' announcements should conform to the numbering convention in
the standard format. They noted that wording could require them to
modify information systems currently used in conjunction with program
announcements and associated agency guidance documents.
Response: We removed the information on format because OMB reissued
final guidance on notice of funding opportunities available at 2 CFR
200.203 and Appendix I to part 200. Further, the remaining portions of
the proposed guidance at part 27 are incorporated into part 200.
Comment: One Federal awarding agency noted that we should narrow
the scope of the proposed guidance for paragraph E.3 of the
announcement format in the appendix to part 27. The proposed guidance
for that paragraph required an agency to inform potential applicants
that awarding officials would consider information in designated
integrity and performance system prior to making awards. The commenter
noted that the guidance should exempt announcements under which a
Federal awarding agency anticipated no Federal awards with Federal
funding in excess of the simplified acquisition threshold above which
section 872 requires Federal awarding agencies to consider information
in the system.
Response: We agree and Appendix I to Part 200 reflects that
information regarding the designated integrity and performance system
is included in notices of funding opportunities when the Federal
awarding agency anticipates that any Federal award under a notice of
funding opportunity may include, over the period of performance, a
total
[[Page 43304]]
Federal share greater than the simplified acquisition threshold.
C. Comments on the Dollar Thresholds Related to Integrity and
Performance Reporting
Comment: One State agency and two Federal awarding agencies sought
further explanation of the differences between the three dollar
thresholds related to the designated integrity and performance system--
at the simplified acquisition threshold (currently $150,000); at
$500,000; and at $10,000,000. One of the Federal awarding agencies
suggested that implementation would be simpler if the three thresholds
were the same.
Response: The three thresholds are consistent with the statutory
requirements of section 872:
$500,000--Subsection (b) of section 872 is the source of
the $500,000 threshold. It essentially requires that the designated
integrity and performance system contain information about each non-
Federal entity: (1) That receives a Federal award of more than
$500,000; and (2) about which there is a proceeding that must be
reported as described in section 872. Therefore, the final guidance
following this preamble states that Federal awarding agencies must
include the award term and condition requiring the recipient to
maintain its information in designated integrity and performance system
for each Federal award where it is anticipated that the total Federal
share will exceed $500,000 over the period of performance. Note that
the award term and condition requires the non-Federal entity to provide
the required information through the SAM (formerly CCR) and to provide
the information specified in SAM.
$10,000,000--The source of the $10,000,000 threshold is
subsection (f) of section 872. Under that subsection (f) of section
872, a non-Federal entity receiving Federal awards with a total value
more than $10,000,000 must submit any information about criminal,
civil, and administrative proceedings that section 872 requires and
update the information semiannually. Based on feedback or as necessary,
OMB may revise the $10,000,000 threshold. Based on feedback, OMB may
consider revising this affirmative disclosure threshold for grants and
cooperative agreements to the extent legally permissible/consistent
with the statute.
$150,000--The third threshold relates to two requirements
for the Federal awarding agency. The source of that threshold, which is
at the simplified acquisition threshold set by the FAR at 48 CFR
Subpart 2.1 and adjusted periodically to track inflation (currently
$150,000), is subparagraph (e)(2)(A) of section 872, which requires the
Federal awarding agency to consider information in the designated
integrity and performance system before making a Federal award for more
than that threshold amount. In addition to implementing that
requirement, the final guidance requires the Federal awarding agency to
report to the designated integrity and performance system any instance
in which the Federal awarding agency does not award a grant or
cooperative agreement above that threshold amount to a non-Federal
entity based on a determination that the non-Federal entity is not
qualified due to its prior record of integrity or performance under
Federal awards. The latter requirement is analogous to the requirement
for procurement contracts in paragraph (c)(5) of section 872.
Comment: An industry association and two Federal awarding agencies
recommended clarifications of the term ``total value'' as used in
relation to the integrity and performance requirements. The association
recommended we adopt the FAR wording to specify that total value
includes priced contract options, even if not yet executed. One Federal
awarding agency suggested we clarify whether future funding obligations
under a multi-year grant are included. The other Federal awarding
agency noted that it was unclear whether the dollar thresholds in part
35 and the award term and condition in the appendix to part 35 were
based on the Federal share of the funding or also included any
recipient cost share or match.
Response: We agree with the comments and the final guidance located
at part 200 is revised to provide the recommended clarifications. The
final guidance clarifies that these thresholds are based on the Federal
share of Federal awards and includes the value of all expected funding
over the period of performance of the Federal award.
Comment: An industry association recommended that we amend the
proposed section 35.275 and require Federal awarding agencies to
include the award term and condition for integrity and performance
reporting only in a grant or cooperative agreement with a total value
expected to be greater than $500,000. The commenter noted that would be
consistent with the FAR requirement for procurement contracts.
Response: We agree. The final guidance located at 2 CFR 200.210 is
revised, as recommended.
D. Comments Related to Types of Information To Be Reported to the
Designated Integrity and Performance System
Comment: One State agency asked who would determine what type of
information about a recipient would be reported by the recipient,
rather than the Federal awarding agency. The agency also asked when and
how the recipient would be notified about its self-reporting
requirements.
Response: The award term and condition in Appendix XII to 2 CFR
part 200 includes the notification to the recipient that it must report
certain information in order to comply with the integrity and
performance reporting requirement. The details about the specific
information that a recipient must provide are addressed in the guidance
regarding the Entity Management area of SAM.
Comment: Four State agencies recommended clarifying the specific
types of proceedings about which the proposed guidance required
recipients to report to the designated integrity and performance
system. Two agencies said that the proposed requirement for recipients
to report on criminal, civil, and administrative proceedings was overly
broad and some noted that State agencies can be parties to legal
proceedings as part of their performance of grants that fund regulatory
enforcement programs. One agency asked why the information was to be
collected and what outcomes might result from a reported proceeding.
Other questions were: Does the requirement apply to local governments
or just to a recipient in the performance of its duties under an award;
does a State agency have to report a fine assessed against it by
another State agency; and what type of documentation must be submitted?
Response: No change was made. The governing statute, section 872,
specifies the breadth of the reporting requirement. As for the purpose
of collecting the information, the designated integrity and performance
system gives a Federal awarding agency more information than is
presently available about a potential recipient's record of performance
under prior Federal awards and occurrences that may shed light on its
integrity and business ethics. The information supports compliance with
long-standing policy that the Federal Government protects the public
interest and ensures the integrity of Federal programs by conducting
business only with responsible persons.
[[Page 43305]]
Potential outcomes due to reported information depend on the nature
of the information. A Federal awarding agency considers the information
in the designated integrity and performance system about a non-Federal
entity when determining that the non-Federal entity is qualified with
respect to a particular Federal award. Information that the non-Federal
entity is currently debarred or suspended precludes the making of the
Federal award to the non-Federal entity in almost all cases, while
other information may or may not lead the Federal awarding agency to
determine that the non-Federal entity is not qualified for the Federal
award. The Federal awarding agency also may notify other Federal
awarding agencies about information in the designated integrity and
performance system--e.g., he or she would refer to a debarring official
information about a matter that may be a cause for debarment.
With respect to the commenters' other questions:
A local government must report if it has a Federal award
with an award term and condition making it subject to the reporting
requirement. It would not be required to report solely by virtue of
being a subrecipient under a Federal award to a State agency.
The requirement is broader than proceedings related to a
recipient's performance under an award. A recipient also must report
about proceedings related to the making of a Federal award (e.g., a
conviction for misuse of Federal appropriations to lobby for an award).
A State agency must report a proceeding that results in a
fine levied against it by another State agency if the violation or
activity for which it is fined is in connection with the making of, or
performance under, a Federal award.
The recipient must provide the information about a
proceeding that is required in SAM. No other documentation is required.
Comment: Two commenters made recommendations related to the
proposed requirement for a recipient to report information to the
designated integrity and performance system about proceedings related
to State awards. One commenter recommended that the requirement be made
parallel with the one for contractors in the FAR clause 52.209-7(c)(1),
by requiring reporting only on proceedings related to Federal awards
and not also those associated with State awards. The second commenter
recommended we clarify that State funds appropriated to a State's
institutions of higher education would not be a ``State award'' for
this purpose.
Response: Due to the challenges associated with collecting State
government information, the final guidance does not include the
proposed requirement to collect information related to State award
proceedings. Collection of information related State award proceedings
may be considered in a subsequent phases of implementation. This
approach is consistent with the FAR implementation of section 872 (75
FR 14059).
Comment: An industry association recommended conforming the
definition of ``administrative proceeding'' with the definition of that
term in the FAR implementation of section 872.
Response: We agree. The definition is revised to be consistent with
the FAR definition in section 52.209-7 of 48 CFR part 52.
Comment: A Federal awarding agency suggested two changes related to
the types of proceedings for which reporting is required. It suggested
defining ``conviction'' analogously to 2 CFR part 180, to include any
deferred prosecution agreement that included a statement of guilt on
the part of the defendant. The agency also suggested eliminating
vagueness from paragraph B.3.d(i) of the award term and condition in
the appendix to part 35, by dropping the words ``it is practical to
judge'' from the requirement for a recipient to report on ``any other
criminal, civil, or administrative proceeding if it is practical for
[the recipient] to judge that it could have led to'' a criminal
conviction or finding of fault and liability that the recipient would
have been required to report.
Response: We agree in part. We conformed the definition of
``conviction'' to the FAR definition, to parallel the implementation of
section 872 for procurement contracts, rather than conforming it to the
definition in 2 CFR part 180 that the commenter suggested. We removed
the words ``it is practical to judge'' from the award term and
condition, as recommended.
E. Other Comments on Requirements in 2 CFR Part 35 Concerning the
Designated Integrity and Performance System and Recipient Qualification
Comment: One Federal awarding agency suggested amending the
proposed section 35.10 to exclude open-ended entitlements and programs
under which funding is allocated in accordance with mandatory formulas
from coverage under part 35. The Federal awarding agency questioned
whether recipient qualification was an appropriate consideration under
those programs, generally known as ``mandatory programs,'' and noted
that they were excluded from coverage under the nonprocurement
suspension and debarment guidance in 2 CFR part 180.
Response: We understand that the nature of mandatory programs could
make it more difficult than it would be under other programs to make a
Federal award to an alternative recipient if the Federal awarding
agency determined that a recipient was not qualified, as the program
still must serve the intended beneficiaries. However, section 872 does
not provide for an exclusion of those programs. Moreover, it would be
important to protect both the investment of Federal funding and the
interests of the beneficiaries in the event that a recipient was found
not to be qualified.
Comment: One Federal awarding agency expressed concern that the
association in the proposed section 35.110 between an awarding
official's signature of an award document and his or her determination
concerning the recipient's qualification could be misinterpreted as a
requirement for a certification that the recipient is qualified. The
agency noted that a certification would require the awarding official
to have more information than one could reasonably expect to be
available to him or her.
Response: The final guidance in part 200 no longer states that an
awarding official's signature represents a determination that a
recipient is qualified to receive a Federal award; however, Federal
awarding agencies remain responsible for reviewing a potential
recipient's records to determine whether the recipient meets the
minimum standards as reflected in 2 CFR 200.205.
Comment: One Federal agency questioned whether the use of the terms
``qualified'' and ``disqualified'' in this part was consistent with the
use of the term ``disqualified'' in 2 CFR part 180. The agency
suggested defining at least one of the terms to avoid unnecessary
confusion.
Response: We agree in part and made revisions of two types. First,
we revised the wording in a number of places within part 200 to clarify
that, under this guidance, each determination by Federal awarding
agency of a non-Federal entity's qualification or disqualification
pertains to the specific Federal award being contemplated at that time.
It is possible for a Federal awarding agency to determine that a non-
Federal entity is not qualified for one award and, depending on the
reasons for that first determination, qualified for another award. For
example, a Federal awarding agency
[[Page 43306]]
may determine that a non-Federal entity is: (1) Not qualified for a
Federal award for a large and complex program, due to information in
the designated integrity and performance system indicating an
unsatisfactory record for performing under Federal awards for programs
of that level of complexity; and (2) qualified for a second Federal
award to carry out a simpler program. Further, Federal awarding
agencies may make a Federal award to a recipient who does not fully
meet these standards, if there are specific conditions that can
appropriately mitigate the effects of the non-Federal entity's risk in
accordance with Sec. 200.207.
The other revisions were to replace the term ``disqualified'' in
part 200 with ``not qualified,'' to remove any potential for confusion
with that term as it is used and defined in 2 CFR part 180.
Comment: Two Federal awarding agencies and an association of health
care centers raised questions and concerns about due process. The
association expressed concern that: (1) A Federal awarding agency that
determines that a non-Federal entity was not qualified for an award was
not required to tell the non-Federal entity why it was not qualified;
and (2) the identification of the non-Federal entity in designated
integrity and performance system as a result of that determination
could prevent it from receiving any Federal funding for five years. One
Federal awarding agency asked if there was a process by which a non-
Federal entity could appeal a Federal awarding agency's determination
that it was not qualified for a Federal award, and the association and
other Federal awarding agency recommended there be one.
Response: We agree in part. With respect to the first concern, we
added a requirement in 2 CFR 200.212 for a Federal awarding agency to
provide an explanation in the notification to a non-Federal entity
about the determination that the non-Federal entity is not qualified
for a Federal award.
With respect to the second concern that information in the
designated integrity and performance system about a non-Federal entity
could prevent it from receiving any Federal funding, we note that a
Federal awarding agency's determination that a non-Federal entity is
not qualified is related to a specific award that is being
contemplated. As explained more fully in the response to the previous
comment, that determination does not preclude the making of a different
Federal award to the non-Federal entity. We revised the wording in
multiple places in part 200 to clarify that connection with a specific
Federal award.
On the matter of appeals of a Federal awarding agency's
determination that a non-Federal entity is not qualified for a Federal
award, we did not revise the guidance to require delay of individual
Federal awards, to allow an opportunity for appeal after the Federal
awarding agency makes the determination. A govermentwide requirement is
impractical in light of the constraints under which many Federal
programs operate, with firm schedules for program execution that are
impelled by statute or needs for timely obligation of appropriated
funds. Individual Federal awarding agencies may, if timing constraints
for their programs permit, offer an opportunity for appeal or
additional input to the Federal awarding agency prior to award. Also
note that the commenters' concern should be addressed by the
opportunities provided for the non-Federal entity's input. Sections
200.212 and 200.340 require Federal awarding agencies to notify non-
Federal entities when information that may be used when Federal
awarding agencies are making future funding decisions is entered into
the designated performance and integrity system. Non-Federal entities
whose information is entered will have the opportunity to comment on
information included in the system.
We anticipate that Federal agencies' and recipients' current
apprehension about the use of the designated integrity and performance
system will abate over time, as they gain practical experience with the
system and associated requirements. If lessons learned from the use of
the designated integrity and performance system warrant further
improvements to the system or clarifications to the guidance, we will
carefully evaluate the existing guidance and revise the guidance, as
appropriate.
Comment: Two Federal awarding agencies commented on the
requirements in the proposed section 35.120 for a Federal awarding
official to check SAM (formerly EPLS) and the designated integrity and
performance system. One agency stated that it was important that
Federal awarding agencies be required to check SAM (formerly EPLS)
separately, as the designated integrity and performance system would
not provide all of the information they required concerning non-Federal
entities that were debarred, suspended, or otherwise excluded or
disqualified from participation in covered Federal transactions. The
other Federal awarding agency recommended including a table to make
clear the different dollar thresholds for use of the two systems--SAM
(formerly EPLS) must be checked before making any Federal covered
transaction, regardless of award amount, while the requirement to check
the designated integrity and performance system applies to a Federal
award with a total value expected to exceed the simplified acquisition
threshold.
Response: We agree in part and plan to provide further
clarification to Federal awarding agencies regarding the relationship
between various governmentwide systems. As discussed earlier in the
preamble, GSA plans to integrate the designated integrity and
performance system (currently FAPIIS) into SAM, so including a detailed
chart in the final guidance outlining when a Federal awarding agency is
required to check specific systems is not appropriate as the chart may
become obsolete. Although a Federal awarding agency searching the
current designated integrity and performance system about a potential
recipient entity may receive information in response to the search, as
well as information from other data systems accessed through the
system, the current design does not ensure that the awarding official
receives all the SAM information that he or she needs. For instance,
FAPIIS does not reflect whether a non-Federal entity has an active SAM
registration as required by 2 CFR part 25. As the commenters note, the
awarding official also must check SAM Exclusions as required by 2 CFR
part 180 prior to making a Federal award for an amount below the dollar
threshold at which he or she is required to check the designated
integrity and performance system. Therefore, it is imperative that a
Federal awarding agency separately checks SAM prior to making an award
at this time.
Comment: A Federal awarding agency noted the requirement in the
proposed paragraph 35.120(a)(3)(ii) for a Federal awarding agency to
check the SAM Exclusions (formerly EPLS) for potential subaward
recipients if Federal approval of those subrecipients was required
under the terms and conditions of the Federal award. It asked if a
prime recipient was required to check the designated integrity and
performance system for information about a non-Federal entity to which
it intended to make a subaward.
Response: If the terms and conditions of the Federal award require
the recipient to obtain Federal awarding agency approval of
subawardees, the Federal awarding agency must check SAM Exclusions to
verify whether a proposed subrecipient is debarred, suspended, or
otherwise disqualified from the subaward. In addition, a recipient is
always required under existing policy (2 CFR 180.300) to verify
[[Page 43307]]
that a non-Federal entity to which it intends to make a subaward is not
excluded or disqualified from the transaction, whether or not Federal
awarding agency approval of the subrecipient is required. Unlike a
Federal awarding agency, however, 2 CFR 180.300 allows recipients
multiple ways in which it can do the verification, checking SAM
Exclusions being just one of those ways. While only Federal awarding
agencies are required to consider information available through the
designated integrity and performance system for awards expected to
exceed the simplified acquisition threshold, a recipient and the
general public are also able to check the system for information in
doing checks of subrecipients.
Comment: A State agency, noting the same requirement in the
proposed paragraph 35.120(a)(3)(ii) to check SAM (formerly EPLS), asked
how the process works if a recipient does not know the identity of all
subrecipients at the time it receives a Federal award. It asked if the
Federal award includes a term requiring verification of subrecipients
and whether that delays the making of subawards.
Response: The requirement stated in the proposed guidance is not
reflected in the final guidance at 2 CFR part 200; however, this
requirement is not new. The existing policy located at 2 CFR 180.425,
states that a Federal awarding agency must check SAM Exclusions for
potential subrecipients if its approval of the subrecipients is
required. When that approval is required, the Federal awarding agency
can check SAM Exclusions after the prime award is made if the
subrecipients' identities are not known until then.
F. Comments on Proposed Amendments to the Nonprocurement Suspension and
Debarment Guidance in 2 CFR Part 180
Comment: One Federal awarding agency recommended revising 2 CFR
180.520 to require suspending and debarring officials to enter
information into SAM Exclusions (formerly EPLS) within three working
days of taking a suspension or debarment action, a reduction from the
current five days. The Federal awarding agency noted that this change
was made in the FAR, in 48 CFR 9.404, as part of the implementation of
the FAPIIS requirements for procurement contracts.
Response: We agree. We made the recommended change and similarly
revised 2 CFR 180.655, to establish a three-day time period for
suspending and debarring officials to report information about
administrative agreements to the designated integrity and performance
system.
Comment: Two Federal agencies suggested revising the requirement in
the proposed section 2 CFR 180.655 for a Federal suspending or
debarring official to report information to the designated integrity
and performance system about each administrative agreement into which
the Federal Government enters with a non-Federal entity in lieu of a
suspension or debarment. One Federal awarding agency recommended
delaying the effective date of the requirement until a planned update
to the designated integrity and performance system added the capability
to accept information about administrative agreements. The other
Federal awarding agency suggested adding a requirement for reporting
any modifications of administrative agreements to the designated
integrity and performance system.
Response: We agree and have made changes in sections 2 CFR 180.655
and 180.660 that are responsive to the recommendations. In October
2010, the designated integrity and performance system gained the
capability to accept information about administrative agreements. The
system specifies the information that must be reported.
Comment: A Federal awarding agency recommended deleting the
requirement in the proposed section 2 CFR 180.660 for a Federal
suspending or debarring official to include information about the
designated integrity and performance system in each administrative
agreement into which he or she enters with a non-Federal entity in lieu
of a suspension or debarment action. The Federal awarding agency stated
that the express purpose of an administrative agreement is to preserve
the non-Federal entity's eligibility to receive a Federal award. It
added that the notice of funding opportunities under which Federal
awards are made are the appropriate places to inform the non-Federal
entity about Federal awarding agency's consideration of information
that they receive through the designated integrity and performance
system, including information about administrative agreements.
Response: We agree. We removed the proposed section 180.660 from
the final guidance. Due to the removal of section 180.660, section
180.665 of the guidance proposed in the February 2010 Federal Register
notice has been designated as section 180.660 in the final guidance.
Comment: The same Federal awarding agency recommended deleting the
requirements in the proposed paragraphs 2 CFR 180.715(h) and
180.870(b)(2)(v) for a Federal suspending or debarring official to
include information about the designated integrity and performance
system in each notice of a suspension or debarment action. The Federal
awarding agency noted that each notice already informs the suspended or
debarred entity that the action results in its being listed in SAM
Exclusions (formerly EPLS), with the mandatory effect of excluding it
from covered transactions. The Federal awarding agency further noted
that the availability of the information to a Federal awarding agency
through the designated integrity and performance system, in addition to
SAM, does not alter that mandatory effect. It suggested that adding
information about designated integrity and performance system to the
notice of suspension or debarment therefore could only confuse the
matter.
Response: We agree. We removed the proposed amendments to sections
180.715 and 180.870 from the final guidance.
III. Next Steps
This final guidance is effective for Federal awards issued on or
after January 1, 2016 that meet the thresholds as described in the
preamble and to existing awards that are terminated on or after January
1, 2016 due to material failure to comply with the Federal award terms
and conditions. Federal awarding agencies that have formally adopted 2
CFR parts 180 and 200 in their entirety in 2 CFR will begin
implementing this final guidance on January 1, 2016. Federal awarding
agencies who adopted 2 CFR parts 180 and 200 through another means must
work with OMB to ensure their regulations or policies are updated
effective January 1, 2016. OMB will collaborate with GSA to ensure that
the user guides and other guidance materials regarding the designated
integrity and performance system are updated to reflect use by the
Federal assistance community. Applicants and recipients will see the
agencies' implementation reflected in requirements identified in notice
of funding opportunities or other agency releases with application
instructions, as well as in the new award term and condition in
Appendix XII to 2 CFR part 200.
List of Subjects
2 CFR Part 180
Administrative practice and procedure, Debarment and suspension,
Grant programs, Loan programs,
[[Page 43308]]
Reporting and recordkeeping requirements.
2 CFR Part 200
Accounting, Auditing, Colleges and universities, State and local
governments, Grant programs, Grants administration, Hospitals, Indians,
Nonprofit organizations, Reporting and recordkeeping requirements.
David Mader,
Controller.
For the reasons stated in the preamble and under the authority of
the Chief Financial Officer Act of 1990 (31 U.S.C. 503), the Office of
Management and Budget amends 2 CFR parts 180 and 200 as set forth
below:
TITLE 2--GRANTS AND AGREEMENTS
Chapter I--Office of Management and Budget Governmentwide Guidance for
Grants and Agreements
PART 180--OMB GUIDELINES TO AGENCIES ON GOVERNMENTWIDE DEBARMENT
AND SUSPENSION (NONPROCUREMENT)
0
1. The authority citation for part 180 continues to read as follows:
Authority: Sec. 2455, Pub. L. 103-355, 108 Stat. 3327; E.O.
12549, 3 CFR, 1986 Comp., p. 189; E.O. 12689, 3 CFR, 1989 Comp., p.
235.
Sec. 180.520 [Amended]
0
2. Amend Sec. 180.520(c) introductory text by removing the words
``generally within five working days,'' and adding in their place
``within three business days,''.
0
3. Add Sec. 180.650 to subpart F to read as follows:
Sec. 180.650 May an administrative agreement be the result of a
settlement?
Yes, a Federal agency may enter into an administrative agreement
with you as part of the settlement of a debarment or suspension action.
0
4. Add Sec. 180.655 to subpart F to read as follows:
Sec. 180.655 How will other Federal awarding agencies know about an
administrative agreement that is the result of a settlement?
The suspending or debarring official who enters into an
administrative agreement with you must report information about the
agreement to the designated integrity and performance system within
three business days after entering into the agreement. This information
is required by section 872 of the Duncan Hunter National Defense
Authorization Act for Fiscal Year 2009 (41 U.S.C. 2313).
0
5. Add Sec. 180.660 to subpart F to read as follows:
Sec. 180.660 Will administrative agreement information about me in
the designated integrity and performance system accessible through SAM
be corrected or updated?
Yes, the suspending or debarring official who entered information
into the designated integrity and performance system about an
administrative agreement with you:
(a) Must correct the information within three business days if he
or she subsequently learns that any of the information is erroneous.
(b) Must correct in the designated integrity and performance
system, within three business days, the ending date of the period
during which the agreement is in effect, if the agreement is amended to
extend that period.
(c) Must report to the designated integrity and performance system,
within three business days, any other modification to the
administrative agreement.
(d) Is strongly encouraged to amend the information in the
designated integrity and performance system in a timely way to
incorporate any update that he or she obtains that could be helpful to
Federal awarding agencies who must use the system.
Chapter II--Office of Management and Budget Guidance
PART 200--UNIFORM ADMINISTRATIVE REQUIREMENTS, COST PRINCIPLES, AND
AUDIT REQUIREMENTS FOR FEDERAL AWARDS
0
6. The authority citation for part 200 continues to read as follows:
Authority: 31 U.S.C. 503.
Sec. 200.0 [Amended]
0
7. Amend Sec. 200.0 by adding ``(accessible at https://www.sam.gov)''
after ``System for Award Management''.
0
8. Revise Sec. 200.113 to read as follows:
Sec. 200.113 Mandatory disclosures.
The non-Federal entity or applicant for a Federal award must
disclose, in a timely manner, in writing to the Federal awarding agency
or pass-through entity all violations of Federal criminal law involving
fraud, bribery, or gratuity violations potentially affecting the
Federal award. Non-Federal entities that have received a Federal award
including the term and condition outlined in Appendix XII--Award Term
and Condition for Recipient Integrity and Performance Matters are
required to report certain civil, criminal, or administrative
proceedings to SAM. Failure to make required disclosures can result in
any of the remedies described in Sec. 200.338 Remedies for
noncompliance, including suspension or debarment. (See also 2 CFR part
180, 31 U.S.C. 3321, and 41 U.S.C. 2313.)
Sec. 200.203 [Amended]
0
9. Amend Sec. 200.203 paragraph (c)(5) by removing ``See also 2 CFR
part 27 (forthcoming at time of publication).''
0
10. Revise Sec. 200.205 paragraph (a) to read as follows:
Sec. 200.205 Federal awarding agency review of risk posed by
applicants.
(a) Review of OMB-designated repositories of govermentwide data.
(1) Prior to making a Federal award, the Federal awarding agency is
required by 31 U.S.C. 3321 and 41 U.S.C. 2313 note to review
information available through any OMB-designated repositories of
governmentwide eligibility qualification or financial integrity
information as appropriate. See also suspension and debarment
requirements at 2 CFR part 180 as well as individual Federal agency
suspension and debarment regulations in title 2 of the Code of Federal
Regulations.
(2) In accordance 41 U.S.C. 2313, the Federal awarding agency is
required to review the publicly available information in the OMB-
designated integrity and performance system accessible through SAM
(currently the Federal Awardee Performance and Integrity Information
System (FAPIIS)) prior to making a Federal award where the Federal
share is expected to exceed the simplified acquisition threshold,
defined in 41 U.S.C. 134, over the period of performance. At a minimum,
the information in the system for a prior Federal award recipient must
demonstrate a satisfactory record of executing programs or activities
under Federal grants, cooperative agreements, or procurement awards;
and integrity and business ethics. The Federal awarding agency may make
a Federal award to a recipient who does not fully meet these standards,
if it is determined that the information is not relevant to the current
Federal award under consideration or there are specific conditions that
can appropriately mitigate the effects of the non-Federal entity's risk
in accordance with Sec. 200.207 Specific conditions.
* * * * *
0
11. In Sec. 200.210, add paragraph (b)(1)(iii) to read as follows:
Sec. 200.210 Information contained in a Federal award.
* * * * *
[[Page 43309]]
(b) * * *
(1) * * *
(iii) Recipient integrity and performance matters. If the total
Federal share of the Federal award may include more than $500,000 over
the period of performance, the Federal awarding agency must include the
term and condition available in Appendix XII--Award Term and Condition
for Recipient Integrity and Performance Matters. See also Sec. 200.113
Mandatory disclosures.
* * * * *
0
12. In Sec. 200.211, revise paragraph (b) and add paragraph (c) to
read as follows:
Sec. 200.211 Public access to Federal award information.
* * * * *
(b) All information posted in the designated integrity and
performance system accessible through SAM (currently FAPIIS) on or
after April 15, 2011 will be publicly available after a waiting period
of 14 calendar days, except for:
(1) Past performance reviews required by Federal Government
contractors in accordance with the Federal Acquisition Regulation (FAR)
42.15;
(2) Information that was entered prior to April 15, 2011; or
(3) Information that is withdrawn during the 14-calendar day
waiting period by the Federal Government official.
(c) Nothing in this section may be construed as requiring the
publication of information otherwise exempt under the Freedom of
Information Act (5 U.S.C 552), or controlled unclassified information
pursuant to Executive Order 13556.
0
13. Revise Sec. 200.212 to read as follows:
Sec. 200.212 Reporting a determination that a non-Federal entity is
not qualified for a Federal award.
(a) If a Federal awarding agency does not make a Federal award to a
non-Federal entity because the official determines that the non-Federal
entity does not meet either or both of the minimum qualification
standards as described in Sec. 200.205, Federal awarding agency review
of risk posed by applicants, paragraph (a)(2), the Federal awarding
agency must report that determination to the designated integrity and
performance system accessible through SAM (currently FAPIIS), only if
all of the following apply:
(1) The only basis for the determination described in paragraph (a)
of this section is the non-Federal entity's prior record of executing
programs or activities under Federal awards or its record of integrity
and business ethics, as described in Sec. 200.205 Federal awarding
agency review of risk posed by applicants, paragraph (a)(2) (i.e., the
entity was determined to be qualified based on all factors other than
those two standards), and
(2) The total Federal share of the Federal award that otherwise
would be made to the non-Federal entity is expected to exceed the
simplified acquisition threshold over the period of performance.
(b) The Federal awarding agency is not required to report a
determination that a non-Federal entity is not qualified for a Federal
award if they make the Federal award to the non-Federal entity and
includes specific award terms and conditions, as described in Sec.
200.207 Specific conditions.
(c) If a Federal awarding agency reports a determination that a
non-Federal entity is not qualified for a Federal award, as described
in paragraph (a) of this section, the Federal awarding agency also must
notify the non-Federal entity that--
(1) The determination was made and reported to the designated
integrity and performance system accessible through SAM, and include
with the notification an explanation of the basis for the
determination;
(2) The information will be kept in the system for a period of five
years from the date of the determination, as required by section 872 of
Public Law 110-417, as amended (41 U.S.C. 2313), then archived;
(3) Each Federal awarding agency that considers making a Federal
award to the non-Federal entity during that five year period must
consider that information in judging whether the non-Federal entity is
qualified to receive the Federal award when the total Federal share of
the Federal award is expected to include an amount of Federal funding
in excess of the simplified acquisition threshold over the period of
performance;
(4) The non-Federal entity may go to the awardee integrity and
performance portal accessible through SAM (currently the Contractor
Performance Assessment Reporting System (CPARS)) and comment on any
information the system contains about the non-Federal entity itself;
and
(5) Federal awarding agencies will consider that non-Federal
entity's comments in determining whether the non-Federal entity is
qualified for a future Federal award.
(d) If a Federal awarding agency enters information into the
designated integrity and performance system accessible through SAM
about a determination that a non-Federal entity is not qualified for a
Federal award and subsequently:
(1) Learns that any of that information is erroneous, the Federal
awarding agency must correct the information in the system within three
business days;
(2) Obtains an update to that information that could be helpful to
other Federal awarding agencies, the Federal awarding agency is
strongly encouraged to amend the information in the system to
incorporate the update in a timely way.
(e) Federal awarding agencies shall not post any information that
will be made publicly available in the non-public segment of designated
integrity and performance system that is covered by a disclosure
exemption under the Freedom of Information Act. If the recipient
asserts within seven calendar days to the Federal awarding agency that
posted the information that some or all of the information made
publicly available is covered by a disclosure exemption under the
Freedom of Information Act, the Federal awarding agency that posted the
information must remove the posting within seven calendar days of
receiving the assertion. Prior to reposting the releasable information,
the Federal awarding agency must resolve the issue in accordance with
the agency's Freedom of Information Act procedures.
0
14. Add Sec. 200.213 to subpart C to read as follows:
Sec. 200.213 Suspension and debarment.
Non-federal entities are subject to the non-procurement debarment
and suspension regulations implementing Executive Orders 12549 and
12689, 2 CFR part 180. These regulations restrict awards, subawards,
and contracts with certain parties that are debarred, suspended, or
otherwise excluded from or ineligible for participation in Federal
assistance programs or activities.
Sec. 200.300 [Amended]
0
15. Amend Sec. 200.300 paragraph (b) by removing ``Central Contractor
Registration'' and adding in its place ``System for Award Management''.
Sec. 200.318 [Amended]
0
16. Amend Sec. 200.318 paragraph (h) by removing ``Sec. 200.212'' and
adding in its place ``Sec. 200.213''.
0
17. In Sec. 200.339, revise paragraph (b) and add paragraph (c) to
read as follows:
Sec. 200.339 Termination.
* * * * *
(b) When a Federal awarding agency terminates a Federal award prior
to the
[[Page 43310]]
end of the period of performance due to the non-Federal entity's
material failure to comply with the Federal award terms and conditions,
the Federal awarding agency must report the termination to the OMB-
designated integrity and performance system accessible through SAM
(currently FAPIIS).
(1) The information required under paragraph (b) of this section is
not to be reported to designated integrity and performance system until
the non-Federal entity either--
(i) Has exhausted its opportunities to object or challenge the
decision, see Sec. 200.341 Opportunities to object, hearings and
appeals; or
(ii) Has not, within 30 calendar days after being notified of the
termination, informed the Federal awarding agency that it intends to
appeal the Federal awarding agency's decision to terminate.
(2) If a Federal awarding agency, after entering information into
the designated integrity and performance system about a termination,
subsequently:
(i) Learns that any of that information is erroneous, the Federal
awarding agency must correct the information in the system within three
business days;
(ii) Obtains an update to that information that could be helpful to
other Federal awarding agencies, the Federal awarding agency is
strongly encouraged to amend the information in the system to
incorporate the update in a timely way.
(3) Federal awarding agencies, shall not post any information that
will be made publicly available in the non-public segment of designated
integrity and performance system that is covered by a disclosure
exemption under the Freedom of Information Act. If the non-Federal
entity asserts within seven calendar days to the Federal awarding
agency who posted the information, that some of the information made
publicly available is covered by a disclosure exemption under the
Freedom of Information Act, the Federal awarding agency who posted the
information must remove the posting within seven calendar days of
receiving the assertion. Prior to reposting the releasable information,
the Federal agency must resolve the issue in accordance with the
agency's Freedom of Information Act procedures.
(c) When a Federal award is terminated or partially terminated,
both the Federal awarding agency or pass-through entity and the non-
Federal entity remain responsible for compliance with the requirements
in Sec. Sec. 200.343 Closeout and 200.344 Post-closeout adjustments
and continuing responsibilities.
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18. Revise Sec. 200.340, paragraph (b) to read as follows:
Sec. 200.340 Notification of termination requirement.
* * * * *
(b) If the Federal award is terminated for the non-Federal entity's
material failure to comply with the Federal statutes, regulations, or
terms and conditions of the Federal award, the notification must state
that--
(1) The termination decision will be reported to the OMB-designated
integrity and performance system accessible through SAM (currently
FAPIIS);
(2) The information will be available in the OMB-designated
integrity and performance system for a period of five years from the
date of the termination, then archived;
(3) Federal awarding agencies that consider making a Federal award
to the non-Federal entity during that five year period must consider
that information in judging whether the non-Federal entity is qualified
to receive the Federal award, when the Federal share of the Federal
award is expected to exceed the simplified acquisition threshold over
the period of performance;
(4) The non-Federal entity may comment on any information the OMB-
designated integrity and performance system contains about the non-
Federal entity for future consideration by Federal awarding agencies.
The non-Federal entity may submit comments to the awardee integrity and
performance portal accessible through SAM (currently (CPARS).
(5) Federal awarding agencies will consider non-Federal entity
comments when determining whether the non-Federal entity is qualified
for a future Federal award.
* * * * *
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19. In Appendix I to Part 200, revise paragraph E.3., add paragraph
E.4., and revise paragraph F.3. to read as follows:
Appendix I to Part 200--Full Text of Notice of Funding Opportunity
* * * * *
E. * * *
3. For any Federal award under a notice of funding opportunity,
if the Federal awarding agency anticipates that the total Federal
share will be greater than the simplified acquisition threshold on
any Federal award under a notice of funding opportunity may include,
over the period of performance (see Sec. 200.88 Simplified
Acquisition Threshold), this section must also inform applicants:
i. That the Federal awarding agency, prior to making a Federal
award with a total amount of Federal share greater than the
simplified acquisition threshold, is required to review and consider
any information about the applicant that is in the designated
integrity and performance system accessible through SAM (currently
FAPIIS) (see 41 U.S.C. 2313);
ii. That an applicant, at its option, may review information in
the designated integrity and performance systems accessible through
SAM and comment on any information about itself that a Federal
awarding agency previously entered and is currently in the
designated integrity and performance system accessible through SAM;
iii. That the Federal awarding agency will consider any comments
by the applicant, in addition to the other information in the
designated integrity and performance system, in making a judgment
about the applicant's integrity, business ethics, and record of
performance under Federal awards when completing the review of risk
posed by applicants as described in Sec. 200.205 Federal awarding
agency review of risk posed by applicants.
4. Anticipated Announcement and Federal Award Dates--Optional.
This section is intended to provide applicants with information they
can use for planning purposes. If there is a single application
deadline followed by the simultaneous review of all applications,
the Federal awarding agency can include in this section information
about the anticipated dates for announcing or notifying successful
and unsuccessful applicants and for having Federal awards in place.
If applications are received and evaluated on a ``rolling'' basis at
different times during an extended period, it may be appropriate to
give applicants an estimate of the time needed to process an
application and notify the applicant of the Federal awarding
agency's decision.
F. * * *
3. Reporting--Required. This section must include general
information about the type (e.g., financial or performance),
frequency, and means of submission (paper or electronic) of post-
Federal award reporting requirements. Highlight any special
reporting requirements for Federal awards under this funding
opportunity that differ (e.g., by report type, frequency, form/
format, or circumstances for use) from what the Federal awarding
agency's Federal awards usually require. Federal awarding agencies
must also describe in this section all relevant requirements such as
those at 2 CFR 180.335 and 2 CFR 180.350.
If the Federal share of any Federal award may include more than
$500,000 over the period of performance, this section must inform
potential applicants about the post award reporting requirements
reflected in Appendix XII--Award Term and Condition for Recipient
Integrity and Performance Matters.
* * * * *
0
20. Add Appendix XII to Part 200 to read as follows:
[[Page 43311]]
Appendix XII to Part 200--Award Term and Condition for Recipient
Integrity and Performance Matters
A. Reporting of Matters Related to Recipient Integrity and Performance
1. General Reporting Requirement
If the total value of your currently active grants, cooperative
agreements, and procurement contracts from all Federal awarding
agencies exceeds $10,000,000 for any period of time during the
period of performance of this Federal award, then you as the
recipient during that period of time must maintain the currency of
information reported to the System for Award Management (SAM) that
is made available in the designated integrity and performance system
(currently the Federal Awardee Performance and Integrity Information
System (FAPIIS)) about civil, criminal, or administrative
proceedings described in paragraph 2 of this award term and
condition. This is a statutory requirement under section 872 of
Public Law 110-417, as amended (41 U.S.C. 2313). As required by
section 3010 of Public Law 111-212, all information posted in the
designated integrity and performance system on or after April 15,
2011, except past performance reviews required for Federal
procurement contracts, will be publicly available.
2. Proceedings About Which You Must Report
Submit the information required about each proceeding that:
a. Is in connection with the award or performance of a grant,
cooperative agreement, or procurement contract from the Federal
Government;
b. Reached its final disposition during the most recent five
year period; and
c. Is one of the following:
(1) A criminal proceeding that resulted in a conviction, as
defined in paragraph 5 of this award term and condition;
(2) A civil proceeding that resulted in a finding of fault and
liability and payment of a monetary fine, penalty, reimbursement,
restitution, or damages of $5,000 or more;
(3) An administrative proceeding, as defined in paragraph 5. of
this award term and condition, that resulted in a finding of fault
and liability and your payment of either a monetary fine or penalty
of $5,000 or more or reimbursement, restitution, or damages in
excess of $100,000; or
(4) Any other criminal, civil, or administrative proceeding if:
(i) It could have led to an outcome described in paragraph
2.c.(1), (2), or (3) of this award term and condition;
(ii) It had a different disposition arrived at by consent or
compromise with an acknowledgment of fault on your part; and
(iii) The requirement in this award term and condition to
disclose information about the proceeding does not conflict with
applicable laws and regulations.
3. Reporting Procedures
Enter in the SAM Entity Management area the information that SAM
requires about each proceeding described in paragraph 2 of this
award term and condition. You do not need to submit the information
a second time under assistance awards that you received if you
already provided the information through SAM because you were
required to do so under Federal procurement contracts that you were
awarded.
4. Reporting Frequency
During any period of time when you are subject to the
requirement in paragraph 1 of this award term and condition, you
must report proceedings information through SAM for the most recent
five year period, either to report new information about any
proceeding(s) that you have not reported previously or affirm that
there is no new information to report. Recipients that have Federal
contract, grant, and cooperative agreement awards with a cumulative
total value greater than $10,000,000 must disclose semiannually any
information about the criminal, civil, and administrative
proceedings.
5. Definitions
For purposes of this award term and condition:
a. Administrative proceeding means a non-judicial process that
is adjudicatory in nature in order to make a determination of fault
or liability (e.g., Securities and Exchange Commission
Administrative proceedings, Civilian Board of Contract Appeals
proceedings, and Armed Services Board of Contract Appeals
proceedings). This includes proceedings at the Federal and State
level but only in connection with performance of a Federal contract
or grant. It does not include audits, site visits, corrective plans,
or inspection of deliverables.
b. Conviction, for purposes of this award term and condition,
means a judgment or conviction of a criminal offense by any court of
competent jurisdiction, whether entered upon a verdict or a plea,
and includes a conviction entered upon a plea of nolo contendere.
c. Total value of currently active grants, cooperative
agreements, and procurement contracts includes--
(1) Only the Federal share of the funding under any Federal
award with a recipient cost share or match; and
(2) The value of all expected funding increments under a Federal
award and options, even if not yet exercised.
B. [Reserved]
[FR Doc. 2015-17753 Filed 7-21-15; 8:45 am]
BILLING CODE P