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North Dakota Parks and Recreation Department
Recreation Division – 701-328-5357 – parkrec@nd.gov
Recreational Trail Program (RTP)
Program Manual
http://www.parkrec.nd.gov/recreation/grants/rtp/rtpoverview.html
Moving Ahead for Progress in the 21st Century (MAP-21)
Effective October 1, 2012 through September 30, 2014.
Revised 11/29/2013
1
Table of Contents
Introduction
3
General Information
Program Overview
Title VI
RTP Funding
Eligibility
“40-30-30” Requirement
Project Timeline
Eligible Projects/Expenses
Ineligible Projects/Expenses
Land Acquisitions and Easements
Control and Tenure
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4
4
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5
6
6
7
7
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Application Process and Review
Technical Review
Recreational Trail Program Advisory Committee (RTPAC)
Pair-Based Scoring Process and Example
Environmental and Historical Requirements and Project Clearance
State Historic Preservation Office (SHPO) Requirements
Other Environmental Considerations
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9
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9
10
11
12
Project Expenditure and Reimbursement Process
Contributions and Expenses
Local Share
Federal Matching Share
Procurement
Reimbursement
Progress Reports
Amendments
Project Termination
Project Site Retention & Future Responsibilities
Signage Requirement
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Attachments
A- Sample Online Application
B- FHWA 1273 Synopsis
C- FHWA Form 1273
D- Federal Register Rules and Regulations,
Vol. 75, No. 177, dated September 14, 2010, pages 55663-55676
E- Title VI Sub-recipient Assurances and Non-discrimination Provisions
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20
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58
67
North Dakota Parks and Recreation Department
Recreation Division – 701-328-5357 – parkrec@nd.gov
RECREATIONAL TRAIL PROGRAM
Program Manual
***NEW PROGRAM ITEMS IN THE MANUAL ARE HIGHLIGHTED IN YELLOW***
Introduction
The North Dakota Parks and Recreation Department (NDPRD) in cooperation with the North
Dakota Division Office of the Federal Highway Administration (FHWA) has prepared this manual
to answer questions relating to project application and management.
General Information
Program Overview
The Recreational Trails Program (RTP) is a federal-aid assistance program to help states provide
and maintain recreational trails for both motorized and non-motorized trail use. The program
provides funds for all kinds of recreational trail uses, such as pedestrian uses (hiking, running,
and wheelchair use), bicycling, in-line skating, equestrian use, cross-country skiing,
snowmobiling, canoe/kayak trails, off-road motorcycling, all-terrain vehicle riding, four-wheel
driving, or using other off-road motorized vehicles.
The Moving Ahead for Progress in the 21st Century Act (MAP-21) reauthorized the Recreational
Trails Program (RTP) through Federal fiscal years 2013 and 2014 as a set aside from the new
Transportation Alternatives Program. The RTP funds come from the Federal Highway Trust Fund,
and represent a portion of the motor fuel excise tax collected from non-highway recreational fuel
use: fuel used for off-highway recreation by snowmobiles, all-terrain vehicles, off-highway
motorcycles, and off-highway light trucks.
The U.S. Department of Transportation, Federal Highway Administration (USDOT/FHWA)
administers the RTP program. The Governor of the state of North Dakota has designated the
North Dakota Parks and Recreation Department (NDPRD) as the agency responsible for
administering apportionments made to the state. RTP funds represent a portion of the federal
gasoline tax attributed to recreation on non-gasoline tax supported roads. The federal
government prescribes many of the regulations governing this program.
NDPRD, along with the Recreational Trail Program Advisory Committee (RTPAC), intends that
RTP grant funding be used to enhance trail opportunities by achieving results that would not
otherwise be possible. RTP grants are for projects that are primarily recreational in nature,
rather than serving a more utilitarian transportation function. The following is a list of eligible
projects:
3
New construction (first priority for RTP funding)
Maintenance of existing trails (re-routes)
Trail amenities
Purchase and lease of recreational trail construction and maintenance equipment
Land or easement acquisition
Trail accessibility assessment
Title VI
Title VI
Sponsors who are Title VI compliant may coordinate bidding and procurement on their own.
Sponsors must follow the original procurement process for reimbursement. All bidding,
procurement and construction must adhere to Title VI requirements. Additional information on
the Title VI Program is available on the North Dakota Parks and Recreation Department website
at: http://www.parkrec.nd.gov/information/department/attachments/title_6_program.pdf.
Sponsors who are not Title VI compliant will work with NDPRD during the bidding and
procurement process. Project reimbursement in this manner will require project
reimbursement (20%) from sponsor to NDPRD.
RTP Funding
The Recreation Trails Program funds up to 80% of eligible costs for trail projects. At the time of
application the project sponsor must have at least 20% of the total project cost available. The
local share may include tax sources (appropriations), bond issues or force account contributions.
The donated value of land, cash, labor, equipment and materials may also be used.
Individual grant awards are limited to a minimum of $10,000 and a maximum of $200,000.
NDPRD and the RTPAC reserve the right to change the minimum/maximum dollar amounts in
order to ensure the complete expenditure of RTP funds. A second cycle may be offered to
ensure total expenditure of funds.
Eligibility
(Please note equipment projects, only federal, state and municipal agencies qualify for funding;
a use agreement will need to be signed by the project sponsor). Grants may be awarded to any
of the following:
Non-profit organizations - A qualified non-profit organization is one that meets the
following criteria:
o Registered with the State of North Dakota as a non-profit for a minimum of 5
years.
o Will name a successor at the time of any change in organizational status (for
example, dissolution). A qualified successor is any party that meets the eligibility
criteria to apply for RTP funds and is capable of complying with all RTP
responsibilities. NDPRD recommends, whenever possible, a government agency
4
be sought as a successor. A successor organization must agree, in writing, to
complete all RTP project responsibilities should the original organization’s status
change.
Title VI of the Civil Rights Act of 1964 ensures that no person in the United States shall,
on the grounds of race, color, or national origin, be excluded from participation in, be
denied the benefits of, or be otherwise subjected to discrimination, including sex, age,
disability, low-income, or LEP discrimination, under any program or activity for which
the Recipient receives Federal financial assistance. The Civil Rights Restoration Act of
1987 clarified the original intent of Congress, with respect to Title VI and other Nondiscrimination requirements (The Age Discrimination Act of 1975, and Section 504 of the
Rehabilitation Act of 1973) by restoring the broad, institutional-wide scope and
coverage of these non-discrimination statutes and requirements to include all programs
and activities of the Recipient, so long as any portion of the program is Federallyassisted.
Municipal agencies (cities, towns, counties, school districts, etc.)
State agencies (North Dakota Parks and Recreation Department, North Dakota Forest
Service, North Dakota Game and Fish).
Federal government agencies (Bureau of Land Management, U.S. Forest Service, National
Park Service, etc.)
Other government entities (regional governments, etc.)
Potential project sponsors with active or previously awarded grants through NDPRD must be in
full compliance with federal and state programs to be eligible for funding.
“40-30-30” Requirement
RTP Legislation (23 U.S.C. 206) requires that States use 40 percent of their funds in a fiscal year
for diverse recreational trail use; 30 percent for motorized recreation; and 30 percent for nonmotorized recreation. The diverse, motorized, and non-motorized percentages are minimum
requirements that must be met. A project for diverse motorized use (such as snowmobile and
off-road motorcycle use) may satisfy the 40 percent diverse use requirement and the 30 percent
motorized use requirement simultaneously. A project for diverse non-motorized use (such as
pedestrian and bicycle use) may satisfy the 40 percent diverse use requirement and the 30
percent non-motorized use requirement simultaneously.
To provide more flexibility in RTP project selection, FHWA established five categories to account
for the 40-30-30 requirements:
5
1) Non-motorized project for a single use: A project primarily intended to benefit only one
mode of non-motorized recreational trail use, such as pedestrian use only, water trails
(canoe/kayak), or equestrian use only. RTP projects serving various pedestrian uses (such
as walking, hiking, wheelchair use, running, bird-watching, nature interpretation,
backpacking, etc.) constitute a single use for the purposes of this category. A project
serving various non-motorized human-powered snow uses (such as skiing, snowshoeing,
etc.) constitutes single use for this category.
2) Non-motorized diverse use project: A project primarily intended to benefit more than one
mode of non-motorized recreational use such as: walking, bicycling, and skating; both
pedestrian and equestrian use; and pedestrian use in summer and cross-country ski use
in winter.
3) Diverse use project including both motorized and non-motorized uses: A project intended
to benefit both non-motorized recreational trail use and motorized recreational trail use.
This category includes projects where motorized use is permitted, but is not the
predominant beneficiary. This category includes RTP projects where motorized and nonmotorized uses are separated by season, such as equestrian use in summer and
snowmobile use in winter.
4) Motorized single use project: A project primarily intended to benefit only one mode of
motorized recreational use, such as snowmobile trail grooming. A project may be
classified in this category if the project also benefits some non-motorized uses (it is not
necessary to exclude non-motorized uses), but the primary intent must be for the benefit
of motorized use.
5) Motorized diverse use project: A project primarily intended to benefit more than one
mode of motorized recreational use, such as: motorcycle and ATV use; or ATV use in
summer and snowmobile use in winter. A project may be classified in this category if the
project also benefits some non-motorized uses (it is not necessary to exclude nonmotorized uses), but the primary intent must be for the benefit of motorized use.
Projects in categories 1 and 2 apply towards the 30 percent non-motorized use requirement.
Projects in categories 2, 3, and 5 apply towards the 40 percent diverse trail use requirement.
Projects in categories 4 and 5 apply towards the 30 percent motorized use requirement.
Project Timeline
When applying for project funding, the project sponsor must be ready to begin construction upon
grant approval. This requirement includes having all local match available and all project planning
complete. Once the project sponsors are notified of their project approval and funding level, they
have 18 months to complete the project.
Eligible Projects/Expenses
Projects will be ranked based on the categories below with construction of new recreation trails
being given the highest priority.
1. Construction of new recreation trails: For projects on federal land, the most important
requirement is that the federal agency land manager must approve of the project in
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2.
3.
4.
5.
accordance with other applicable federal laws and regulations. This category may include
construction of new trail bridges, or providing appropriate signage along a trail.
Restoration of existing trails: Restoration may be interpreted broadly to include any kind
of non-deferred trail maintenance, restoration, rehabilitation, or relocation. This category
may include maintenance and restoration of trail bridges, or providing appropriate
signage along a trail.
Development and rehabilitation of trailside and trailhead facilities and trail linkages: This
may be interpreted broadly to include development or rehabilitation of any trailside and
trailhead facility. The definition of “rehabilitation” means extensive trail repair needed to
bring a facility up to standards suitable for public use due to natural disasters or acts of
nature. Trailside and trailhead facilities must have a direct relationship with a
recreational trail.
Purchase and lease of recreational trail construction and maintenance equipment:
Purchase and lease of any trail construction and maintenance equipment, provided the
equipment is used primarily to construct and maintain recreational trails. This provision
does not include purchase of equipment which may be used for purposes unrelated to
recreational trails. For example, a lawn mower purchased under this program must be
used primarily for trail and trailside maintenance, not to maintain open lawn areas or
sport fields. (Please note equipment projects, only federal, state and municipal agencies
qualify for funding; a use agreement will need to be signed by the project sponsor).
Acquisition: See the Land Acquisitions and Easements section below; please note, RTP
legislation prohibits condemnation of any kind of interest in property. Therefore,
acquisition of any kind of interest in property must be from a willing landowner or seller.
Ineligible Projects/Expenses
Condemned Land as Matching Value: RTP legislation prohibits using RTP funds for
condemnation of any kind of interest in property. An RTP project may be located on land
condemned with funds from other sources. However, it is not permissible to use the value
of condemned land toward the match requirement for an RTP project.
Feasibility Studies: Trail feasibility studies are not a use permitted in the RTP legislation.
The permissible uses relate to actual on-the- ground trail projects.
Environmental Evaluation and Documentation: Projects intended solely for the purpose
of covering environmental evaluation and documentation costs are not permissible.
However, reasonable environmental evaluation and documentation costs, including costs
associated with environmental permits and approvals, may be included as part of an
approved project’s engineering costs. Costs incurred developing the environmental
evaluation, necessary permits, as well as engineering costs may not exceed 20% of the
total funded project cost.
Law Enforcement: Routine law enforcement is not a use permitted in the RTP
legislation.
Planning: Trail planning is not a permissible use of RTP funds.
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Sidewalks: RTP funds will not normally be used to provide paths or sidewalks along or
adjacent to public roads or streets, unless the path or sidewalk is needed to complete a
missing link between other recreational trails.
Roads: RTP funds may not be used to improve roads for general passenger vehicle use.
Overhead: The regular operating expenses such as rent, building upkeep, utilities and all
fixed costs associated with a business, agency or group.
Indirect Costs: Only direct costs that can be identified specifically with a particular final
cost objective directly related to the trail project are eligible.
Land Acquisitions and Easements
Acquisition Costs: The following land acquisition costs are allowable and eligible for
reimbursement under the Recreational Trails Program:
o The appraised fair market value of fee simple title or an easement for the use of
real property acquired by negotiated purchase.
o The purchase price for an easement or fee title to real property acquired below
appraised value.
o The donated land value (the difference between the purchase price and appraised
value) may be used as a match for federal funds to purchase that parcel of land,
purchase other pieces of property, or develop facilities.
o Similarly, lands for which 100% of the value is donated may only be used as the
organization’s share of a project to purchase other land or build facilities.
o Appraisal fees.
o Boundary surveys, title search, legal filling fees.
Ineligible Costs: Costs ineligible for reimbursement in an acquisition project include:
o The purchase of real property to which the project sponsor became committed
prior to federal approval.
o Legal fees other than for filling and fines and penalties paid by the project sponsor.
o Incidental costs relating to real property acquisition and interests in real property
unless allowable under the Uniform Relocation Assistance and Real Property
Acquisition Policies Act.
o Taxes for which the local sponsor would not have been liable to pay.
o Damage judgments arising out of acquisition whether determined by judicial
decision, arbitration or otherwise.
Easements: In some instances, the applicant will not be able to purchase the property
but can acquire an easement. An easement must be for a period of at least 25 years.
During the time period, the easement cannot be revoked at will by the landowner
unless the applicant or state is guilty of an infraction of the easement. The land must
still be retained in public trail use for the duration of the easement period even though
the easement has been revoked. Provisions stated in the easement cannot be
detrimental to the proposed recreational development.
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A draft copy of the easement must accompany the application for acquisition and
development projects. If an easement has been or is to be executed prior to the
submission of a development project application, a draft copy of the easement should
be sent to the NDPRD for review. Advance approval of such agreements may help
ensure the eligibility of the site for funding. Negotiations for easements must follow
general negotiated land purchase regulations including the requirements of the
Uniform Relocation Assistance and Real Property Acquisition Policies Act.
Control and Tenure
Adequate control must be established by an applicant over any land (public or private) to be
improved/ developed with RTP grant funds, including documentation of the fee title, lease,
easement, or use agreement. Lease, easement and use agreement terms must be for a term no
less than 25 years.
The application must identify all outstanding rights or interests held by others on land upon which
the project is proposed. A signed letter explaining control and tenure must be submitted for all
projects not located on Federal Lands. The applicant will be required to submit a signed approval
from the official responsible for management of the project property.
Application Process and Review
The following information outlines the review process for each submitted application. A sample
application can be found at the end of this document (see Attachment A on page 20).
Metropolitan Planning Organizations
Project sponsors that fall into one of the Metropolitan Planning Organizations’ jurisdictions must
provide evidence that their project is in compliance with the MPO Long Range Transportation
Plan. These areas include Bismarck-Mandan, Grand Forks, and Fargo.
Technical Review
Once a potential sponsor submits an application, NDPRD staff will review the application for
completeness, eligibility, the sponsor’s current grant status, match, property ownership,
local/regional/federal approval, etc. Staff will forward eligible applications to the Recreational
Trails Program Advisory Committee (RTPAC) for further consideration.
Recreational Trail Program Advisory Committee (RTPAC)
RTPAC membership represents a broad range of motorized and non-motorized trail users and
associations. A total of nine committee members are appointed by the Director of the North
Dakota Parks and Recreation Department and must be recreational trail users and represent trail
interests (hiking, biking, horseback riding, paddling, OHV and snowmobile). Committee members
are appointed for 3-year terms. Upon completion of a 3-year term, NDPRD will advertise for
replacement of the committee member. If no eligible candidates are received, the existing
committee member will be given the option to renew their term. In North Dakota the committee
serves as the evaluation committee that reviews and prioritizes grant applications and
recommends projects for funding.
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The project evaluation allows committee members to bring their knowledge of statewide and
local recreation patterns, resources, and needs into consideration. Reviewers may rank a project
based upon their evaluation of site suitability, fiscal consideration, commitment to long-term
operation and maintenance, superior design, superior leverage of funding and partnership, ADA
compliance, and project presentation, heritage and legacy context, regional issues, and the basic
intent of MAP-21.
For a current committee list, please visit:
http://www.parkrec.nd.gov/recreation/grants/rtp/attachments/rtpac_member_list.pdf.
Pair-Based Scoring Process and Example
Pair-based scoring is a ranking methodology in which each project is individually ranked against
each other project, one project at a time. In the example below, 7 applications were received
and ranked. The numbers 1-7 correspond with the assigned application numbers. Projects are
then compared starting with project number 1 vs. project number 2. The better of the two
projects is then marked on the score sheet. Then project 1 is compared to project 3 and again
the better project is marked on the score sheet. This process is repeated until project 1 has
been compared to all other applications. Project 2 is then compared against all other projects
excluding project 1, then project 3 against all others excluding 1 and 2, etc., until each has been
compared to all other projects and project preference has been established. Points are assigned
based on the number of times a project is chosen.
Project #
1
2
3
4
5
6
7
Total Times Chosen
4
2
0
6
5
3
1
Pair Ranking
1 vs. 2, 1 vs.3, 1 vs. 4, 1 vs. 5, 1 vs. 6, 1 vs. 7
2 vs. 3, 2 vs. 4, 2 vs. 5, 2 vs. 6, 2 vs. 7
3 vs. 4, 3 vs. 5, 3 vs. 6, 3 vs. 7
4 vs. 5, 4 vs. 6, 4 vs. 7
5 vs. 6, 5 vs. 7
6 vs. 7
____21_____ Total Points - The sum of all points should be 21.
In this example project number 4 was selected the most times and is ranked #1, followed by
project 5 and so on. Once the projects have been ranked by all committee members, the scores
will be averaged and the highest ranking projects will be submitted for environmental and
historical review and clearance.
Environmental and Historical Requirements and Project Clearance
Documentation of compliance with the National Environmental Policy Act (NEPA) and other
Federal environmental laws, regulations, and Executive Orders must be provided as part of an
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authorized project under the RTP. FHWA procedures in 23 CFR 771 apply to the RTP. Each project
must be evaluated to determine the environmental impacts; however, most RTP projects will
qualify as Categorical Exclusions (CE) under NEPA (23 CFR 771.117) if they meet the following
requirements:
Does not have significant impacts to planned growth or land use for the area;
Does not require the relocation of a significant number of people;
Do not have a significant impact on any natural, cultural, recreational, historic or other
resource;
Does not involve significant air, noise, or water quality impacts;
Does not have significant impacts on travel patterns;
Does not otherwise have any significant environmental impacts.
The following project types are CE by definition and do not require further review:
Rehabilitation contained within the footprints of existing trails and trailhead facilities;
Re-grading within the footprints of existing trails or trail parking areas;
Striping and/or re-striping of existing facilities;
Replacement, renovation, or rehabilitation of existing signs, kiosks, or markers;
Alterations to existing facilities in order to make them accessible to the elderly and
handicapped persons;
Repair or replacement of existing fencing, guardrails, retaining walls, or berms within
existing facilities, including areas needed for construction and staging.
After the Recreational Trails Program Advisory Committee (RTPAC) reviews and ranks the
applications, the selected projects will be sent to the following agencies to meet the
environmental review requirements:
North Dakota Department of Health
North Dakota Department of Transportation
North Dakota Game and Fish
North Dakota Parks and Recreation Department
North Dakota State Historical Society
North Dakota Water Commission
US Army Corps of Engineers
US Department of Agriculture
US Fish and Wildlife Service
All projects must be approved by these agencies before funding can be awarded.
State Historic Preservation Office (SHPO) Requirements
The SHPO will be contacted to assure that the project proposal complies with State laws
regarding archaeology on lands or historic properties.
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Any project element calling for alteration, rehabilitation, renovation, or demolition of a
historically, culturally, or architecturally significant property or property contributing to
the integrity of a cohesive older neighborhood or historic district needs to be cleared by
the SHPO on a case-by-case basis.
Photographs of impacted properties 45 years of age or older need to be submitted along
with a narrative describing the project, including plans and specifications, as appropriate.
Any available historical information on the property should also be submitted.
It is illegal to disturb an archaeological site or to remove an archaeological site or to
remove an archaeological object from public or private lands unless that activity is
authorized under a permit.
If human remains are found during an excavation, the local law enforcement office must
be contacted to determine if they are Native American or are evidence of a crime scene.
If other archaeological materials are found during a ground disturbing activity, contact the SHPO
at 701-328-2666. The SHPO can check to see if your project area has been surveyed and can give
you a current list of archaeological consultants. Only professional archaeologists or persons
working for recognized scientific organizations may apply for an archaeological permit.
Other Environmental Considerations
Wetlands: Impacts to wetlands must be considered and may result in trail route or
structure changes. All applications will be reviewed by NDPRD Grant staff for wetland
impacts using the U.S. Fish and Wildlife’s Wetland Mapper available at
http://www.fws.gov/wetlands/data/.
Threatened and Endangered Species: The occurrence of a protected species could be an
important issue to consider during the development of an RTP project. Projects will be
reviewed by the U.S. Fish and Wildlife Service and the North Dakota National Heritage
Inventory Program.
Hazardous Wastes and Contaminated Properties: Contaminated sites may be
encountered during the development of RTP projects. Abandoned railroad lines being
converted into trails are of particular concern. Site assessments and appropriate steps for
remediation may be necessary.
Noxious Weeds: Project sponsors are responsible for the spread of noxious weeds in
conjunction with the trail project.
Project Expenditure and Reimbursement Process
Contributions and Expenses
To be eligible for reimbursement funds, project costs must be incurred after the federal project
approval date. Donations of equipment, labor, and materials must be contributed after federal
grant approval. Cash contributions may be received at any time.
The bidding and procurement process must also begin after the federal project approval date,
which will be indicated on your final award letter. Please note a pre-approval award letter will be
sent out to all projects that are ranked high enough to be funded; final approval will be contingent
12
upon Solicitation of View (SOV) letters and responses. Upon successful completion of reviews, a
final award letter, to include the project start/completion date, will be provided to the sponsor.
Local Share
Local match may include donated/volunteer labor, donated equipment and materials, and force
account.
Donated Labor: The time of a person donating services will be valued at a rate paid as a
general laborer (per North Dakota Job Service’s General Laborer Rate for the project area
location, documented and provided by sponsor to NDPRD) unless the person is
professionally skilled in the work being performed on the project (i.e. mason doing work
on a retaining wall). When this is the case, the wage rate this individual is normally paid
for performing this service may be charged to the project. The rates for labor should not
include payroll additives or overhead costs. Evidence of the skilled labor rates must
accompany the reimbursement request. Volunteer labor may be used as match only and
is never a reimbursable item.
Donated Equipment and Materials: Donated equipment and materials may be used as
match only and are never reimbursable items. The value of the donated materials and
equipment rental rates must be documented through an invoice or official letter from the
donor/vendor.
Force Account: Force account is different than volunteer labor or donated equipment and
supplies. Force account refers to the use of a project sponsor’s staff, equipment, and/or
materials. All or part of the project sponsor’s share may be provided through force
account, but force account is never a reimbursable item. Documentation must be
verifiable from the project sponsor’s records, and must be reasonable and necessary for
efficient completion of the project.
Federal Matching Share
The federal share through the RTP for projects is limited to 80 percent except under the following
circumstances:
A Federal agency project sponsor may provide its own funds toward RTP projects as
additional Federal share up to 95 percent of the project cost. The limitation is intended
to ensure commitment to the project from State, local, or private co-sponsors. Under this
provision, a Federal agency project sponsor may provide any amount of funds, provided
the total Federal share does not exceed 95 percent.
Funds from Federal Programs: RTP funds may be matched with funds available under
other Federal funding programs, if the project also is eligible for funding under the other
Federal program. Federal funds received by any project sponsor from another Federal
program may be credited as if they were the non-Federal share, and may be used to
match RTP project funds up to 100 percent of the project cost.
Procurement
Please note this section is only applicable to project sponsors that are Title VI compliant. If the
sponsor is not Title VI compliant, the NDPRD will be coordinating the bidding and procurement
process.
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Grant recipients are required to follow the State of North Dakota’s procurement guidelines
when purchasing goods or services needed to complete a project.
Purchases $2,500 and below: Use adequate procedures to ensure commodities and
services are obtained at a fair and reasonable price, which may include the soliciting only
one informal bid or proposal. Rotate vendors solicited on an equitable basis (ref. N.D.A.C.
§ 4-12-08-02). “Fair and reasonable” price can be based on previous purchases, market
research, a published price list, or by simply soliciting more than one vendor. Remember,
“When in doubt, bid it out.”
Purchases $2,500.01 to $25,000: Solicit no fewer than three vendors, insofar as practical,
to submit oral or written informal bids or proposals. If you do not receive three bids or
proposals, provide a written justification (e.g., “only two known vendors” or “contacted
three vendors, only two responded”).
Purchases over $25,000: Solicit formal sealed bids or proposals with notice to approved
bidders on the State Bidders List (ref. N.D.C.C. § 54-44.4-14, N.D.A.C. Chapter 4-12-08).
Notice of bid opportunities must be placed weekly in a newspaper for a period of no less
than three weeks to ensure notice of a bid opportunity.
Limited Competitive and Noncompetitive Procurements: Occasionally, circumstances
arise under which a fully competitive procurement process may be difficult or impossible.
Procurement is noncompetitive when there is no bidding process. Limited competition
occurs when competition is possible, but the requirements of the solicitation restrict
competition to particular bidders. (Ref. N.D.C.C. § 54-44.4-05, N.D.A.C. § 4-12-09). Project
sponsors must use the State’s Alternate Procurement Request form, SFN 51403 to
document this process and submit to NDPRD prior to entering into a contract or incurring
an expense which is classified as a limited competitive or noncompetitive purchase. In
accordance with federal regulations, NDPRD will then forward to FHWA for approval.
NDPRD will notify the project sponsor of FHWA’s decision within 10 business days of the
forms submittal along with a reason, if denied.
Documentation Requirements: Each procurement transaction must be adequately
documented for audit and public record purposes. If the purchase is over $2,500, the
procurement file must have evidence that three vendors were solicited or document the
reason three bids were not obtained using the guidelines and forms listed above. Include
any required approvals, solicitation documents used, list of bidders solicited and
responses received. In addition a bid tab or summary must be included which includes
the name, address and phone number of the all bidders along with evaluation
worksheets, reasons for rejecting a particular bid, and method of award (e.g. purchasing
card or purchase order).
Exemptions by Statute: Please note, certain commodities and services are not subject to
state procurement laws. The following commodities and services are exempted from
state procurement practices by N.D.C.C. § 54-44.4-02 And N.D.A.C. § 4-12-01-04, as
follows:
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o Land, building, space, or the rental thereof, however before making a
commitment to obtain land for a RTP project, an appraisal must be submitted to
the Parks and Recreation Department for approval. The land is required to be
appraised by a certified general appraiser with federal experience according to the
Uniform Appraisal Standards for Federal Land Acquisitions (located on the web at
http://www.justice.gov/enrd/land-ack/Uniform-Appraisal-Standards.pdf).
No more than the appraised value can be paid.
o Telephone and telegraph service, electrical light, and power services.
o Department of Transportation materials, equipment, and supplies in accordance
with N.D.C.C. § 24-02-16.
o Specific commodities and services as determined by written directive by the
Director of OMB in N.D.A.C § 4-12-01-04 such as: A. contracts for public buildings
and public improvement contract bids, pursuant to N.D.C.C. Title 48. B. Contracts
for architect, engineer, and land surveying services pursuant to N.D.C.C. Chapter
54-44.7.
Required Contract Language: Attached to this manual is FHWA Form 1273 and Title VI
nondiscrimination assurances, which are required to be included in its entirety in every
RTP contract between a project sponsor and any organization, group, agency or individual
they do business with (see attachments B and C). Failure to include this form will result in
forfeiture of RTP funds for the project portion covered by of the contract in question.
While including this form is a federal requirement, only certain portions may apply
depending on the contracted dollar amount or the location of the project (federal road
right of way). Please direct any questions relating to this form to NDPRD grant staff.
Disadvantaged Business Enterprise Program: Project sponsors are encouraged to work
with disadvantaged businesses, including those owned by minorities, women, and socially
and economically disadvantaged individuals, when practical and applicable to the State’s
procurement guidelines. For more information on the ND Department of Transportation’s
Disadvantaged Business Enterprise Program, please visit
http://www.dot.nd.gov/divisions/civilrights/dbeprogram.htm.
Reimbursement
The project sponsor will not receive upfront funding at the time of project approval. Instead, the
sponsor must pay the bills and be reimbursed for a maximum of 80% of the expenses incurred
for the project. To avoid the risk of losing funding, reimbursement requests must be made every
6 months during the project period. Land donations will be credited towards the match of the
sponsor’s share of the project.
As in any program where a reimbursement is requested for a portion of the project costs,
adequate documentation and records are essential. There must be definite supporting
documentation (i.e. invoices and canceled checks) for each item of cost claimed- estimates are
not sufficient. NDPRD may request additional support documentation in order to process a
billing.
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Reimbursement Requests: The following is a list of documentation NDPRD will need to
process reimbursement requests:
o Grant Programs Reimbursement Request Form.
o Grant Programs Progress Report Form.
o Affidavit of publication, supplied by the newspaper when you advertise for bids.
o For purchases over $2,500, include any required approvals, solicitation
documents used, list of bidders solicited and responses received. In addition a
bid tab or summary must be included which includes the name, address and
phone number of the all bidders along with evaluation worksheets, reasons for
rejecting a particular bid, and method of award (e.g. purchasing card or purchase
order). Forms should be dated and signed by responsible official.
o Contractor invoices (or final progress payment, if countersigned by contractor
acknowledging payment of all prior charges, and if the cost of each major work
item is shown) and cancelled checks to contractor (copy of both sides).
o All other cancelled checks (copy of both sides).
o Copies of invoices. Not monthly statements.
o Individual earnings records for the calendar year or payroll journals. Should
show gross wages, withholdings and net pay for each pay period – See Force
Account Form.
o Equipment rental time records.
o Detailed schedule showing how you computed owned-equipment rental rates.
For donated equipment time, you must use hourly rates via a quote from a local
rent all or a published equipment billing chart for a municipality. See Equipment
Value Form.
All required forms are available at
http://www.parkrec.nd.gov/recreation/grants/rtp/reimbursementforms.html
Partial Billings: A partial billing along with supporting documentation may be submitted
to NDPRD after portions of the work have been completed. Submit the completed
"Reimbursement Request Form." The state will retain 5% of the grant amount until the
project is complete and a final inspection completed. Supporting documentation needed
includes the following:
o Progress Report – Grant Programs Progress Report Form
o Expenditure Records indicated above
o Volunteer Logs
Final Billings: In order for a project to be considered completed and ready for final billing,
it should be submitted within thirty days of the completion of the project or grant
expiration date, whichever comes first. Final project billings must be submitted to NDPRD
utilizing the process outlined above. Once a final billing is received NDPRD staff will
contact the project sponsor to discuss the completed RTP project and arrange for a final
inspection. Final project billing and grant closeout will not be completed until NDPRD has
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conducted the final inspection and certified the project is indeed complete, meeting the
project description outlined in the grant application and/or project amendment.
Reimbursement Request Form: A separate file should be established and maintained for
each RTP project. The project sponsor is responsible to track costs according to the
categories on the Grant Programs Reimbursement Request Form and must maintain an
auditable record for a period of not less than 3 years from the date of the final
reimbursement. A GRANT REIMBURSEMENT FORM MUST BE SUBMITTED FOR ALL
PAYMENT REQUESTS AND REIMBURSEMENTS. ONLY THE FORM PROVIDED BY NDPRD
WILL BE ACCEPTED.
Progress Reports
Project sponsors are required to submit progress reports with each reimbursement request or
at a minimum every six months to ensure that NDPRD is aware of the project’s progress. Please
use the “Grant Programs Progress Report” form located at:
http://www.parkrec.nd.gov/recreation/grants/rtp/attachments/grantprogramprogressreport.pdf.
Projects that have not shown progress for six months risk potential termination of RTP funding.
If no progress reports are received, NDPRD will assume no progress has been made.
Amendments
During the project period, various situations may result in changes or deviations from the Project
description. An amendment is necessary to add to, or alter the approved project. Changes that
may necessitate an amendment are increases or decreases in the grant amount, project scope
changes, or an extension of the project period.
Changes in Project Scope: Only those items approved for the project are eligible for
federal assistance. Similarly, facilities must be constructed in the same location as
designated on the plans submitted with the application. Due to unforeseen changes in
project costs or revisions in the plans for the facility, certain items may have to be added
or deleted from the project after it is approved. These changes may require submission
to the Federal Government for approval. In the case of adding an item to the project,
construction on that item cannot begin until the amendment is approved.
The amount of federal assistance specified on the award letter is the maximum amount
reserved for that particular project. Costs over this amount have to be paid by the
applicant. All changes in project scope should be in accordance with the intent of the
original application, and must be justifiable. The need for the change must be
documented by a letter to the NDPRD, accompanied by revised cost estimates,
construction plans and maps.
Project Period Extensions: All acquisition and development must take place within the
project period, which is identified in the award letter. The award letter is sent to the
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project sponsor after the project has received Federal approval. For most projects, the
target date for project completion will be based on an 18 month project period. The
project sponsor is encouraged to complete the project as soon as possible as inflation can
add a 5% cost increase each year.
If the project cannot be completed during the period identified on the project letter, a
request must be submitted for a time extension. The request must justify why the project
cannot be completed before the expiration date. This justification should include a time
schedule for completing the remaining items. Typically no more than one six month
extension can be granted and then only under unforeseen circumstances. Work
performed after the project has expired will not be eligible for federal assistance. Final
payments for work done during the project period can be made after the project has
expired. These payments should specify the work had been completed before the project
expired.
Submission of an Amendment Request: The sponsoring agency initiates the amendment
by submitting a request for the changes to NDPRD. This request should include all project
revisions desired, including cost estimates, maps or design plans, and justification of the
need for the changes. It is recommended the NDPRD be contacted prior to the submission
of the amendment request. Department staff will be able to provide advice on the
feasibility of an amendment approval. An amendment for a change in project scope can
be requested any time prior to the construction of the added item or acquisition of the
added tract. An amendment for an extension of time should be submitted forty-five days
before the project is scheduled to expire.
It is essential that amendment requests be kept to a minimum. Amendments are used to
cover items that could not be anticipated in the original project. Major deviations from
the original project will not be accepted. It is the responsibility of the project sponsor to
thoroughly determine the type of project prior to submission and, upon approval, carry
through with that project.
Project Termination
A project sponsor may request withdrawal of the project at any time prior to the first payment
or expenditure of grant funds. After the initial payment, the project may be rescinded, modified
or amended only by written mutual agreement between the project sponsor and NDPRD.
NDPRD may terminate the project in whole or in part, at any time before the date of completion,
if it is determined the project sponsor has failed to comply with the terms of the project proposal
or the intent of the program. Failure by the project sponsor to comply with the terms of the grant
may cause suspension of all obligations by and a return of any monies received. If a project is
terminated the project sponsor will be notified in writing of the determination and the reasons
for the termination, together with the effective date. Payments made to the project sponsor or
recovery of funds by the NDPRD under projects terminated for cause shall be in accord with the
legal rights and liabilities of the parties.
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NDPRD may terminate the grants in whole, or in part at any time before the date of completion,
when all parties agree that the continuation of the project would not produce beneficial results
commensurate with the further expenditure of funds. The parties shall agree upon the
termination conditions, including the effective date and, in the case of partial termination, the
portion to be terminated. The project sponsor shall not incur new obligations for the terminated
portion after the effective date, and shall cancel as many outstanding obligations as possible.
Termination either for cause or for convenience requires the project in question be brought to a
state of recreational usefulness agreed upon by the project sponsor and NDPRD or all funds must
be returned.
Project Site Retention & Future Responsibilities
At the time of project approval, the project sponsor through the acceptance of funds, commits
that the facilities developed with federal assistance must remain open for general public use and
will be operated and maintained. If RTP monies are used for land acquisition the land must
remain in public trail use for perpetuity. If RTP monies are used for development, the site and
facility must remain in public trail use for 25 years or until the facilities become obsolete or are
at the end of their useable life.
Signage Requirement
Project sites funded through the Recreational Trails Program are required to display a sign stating
that the funding assistance for the site came through a partnership between the FHWA and
NDPRD.
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Attachment A: Sample Online Application
All instructions are indicated by the use of italics.
Go to online application at the following location: http://idctech.net/NDRAM/ and the following screen will
appear.
This section allows you to signup and track your
project details. Once you login to your account your
information about your properties & trails will be
displayed to you.
The My Application section allows you to fill out an
application for a new Land & Water Grant or
Recreational Trails Grant. Once the application is
filled out, you will receive updates via this system
from your state's administrator.
The My Information section will allows you to
modify and change the information you provided
when you signed up to use the RAM system. If you
have any question just ask our staff.
>>Sign In
>>Sign In
>>Sign In
News & Awards
The Complete Inspection
The complete inspection section allows you enter inspection information
for the properties that you manage. This software will take information that use to be stored
non-conforming filing cabinets and place into highly efficient, state-of-the-art software program.
Click on Sign in, then you will be taken to the following screen.
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Log in with your user name and password, then click sign-in. If you do not have a user name and password call
701-328-5364 to request one.
Login
Sponsors who do not know their login information, or who are unsure about their status should contact the grant administrator by phone at
701.328.5364.
Sponsors who have never received a grant from the Land and Water Conservation Fund or the Recreational Trails Fund must register (by
clicking the REGISTER button) as a new sponsor in order to apply for a grant.
EXISTING LOGIN
User Name:
Password:
SIGN-IN
Forget Your Password?
NEW LOGIN
New Users may click here to register and use the system.
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After successful login the following screen will be displayed.
Welcome
Welcome to the RAM System. To proceed, you may select from the menu options on the left side of your web browser. You currently have
57 Recreational Properties that are ready for inspection. You can see which properties these are by clicking on the "My Projects" menu
item.
Click on 'My Projects' to view the Recreational Properties that you help manage.
Click on 'My Applications' to view your current Applications, and to create new
Applications.
Click on 'My Information' to view and edit your Personal Contact Information
as well as your User Name and Password.
Click on 'News & Awards' to read the current News, and to see what awards
have been handed out, and to whom they went.
Click on 'Inspections' to review old Recreational Property Inspections.
Click on My Applications to create a new RTP application.
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My Applications
Welcome to the application section. On this screen, the managing entity can view all of the applications you or the managing entity you
are associated with have submitted, track the status of those applications, and drill deeper into the application information. If you do not
see the ability to add a new application, then you need to be associated with a managing entity, please contact the grant
administrator by phone at 701.328.5364.
CREATE NEW LWCF APPLICATION
CREATE NEW RTP APPLICATION
LWCF
Last Updated
Property Name
RTP Project Name
Click Create New RTP Application then fill out application and upload required documents.
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Fill in project name and click save then a new icon will appear that says “Upload Documents.” Click on this
button to upload all required and support documentation.
Application Page
Recreational Trail Program (RTP) grant awards are available to the State of North Dakota, political subdivisions and nonprofit
organizations in order to assist in the development, maintenance or rehabilitation of recreational trails. The RTP is an assistance program
of the U.S. Department of Transportation's Federal Highway Administration (FHWA). The program is administered by the Recreation
Division of the North Dakota Parks and Recreation Department.
Project proposals must be approved at the state and federal levels. A Recreation Trails Committee of private, state and federal
individuals evaluates and ranks the projects. Projects selected at the state level are submitted to the FHWA for federal review and
approval.
RTP grants reimburse up to 80 percent of the cost for development, maintenance or rehabilitation of recreational trails. The maximum
federal grant award is determined annually. Engineering fees exceeding more that 20% of total project cost are not eligible for
reimbursement. Project sponsors cannot be reimbursed for funds that are incurred before an application is approved and a local grant
agreement is signed.
A application deadline is established each year. Applications must be submitted on or before that date. Late or incomplete applications
will not be considered.
You may press SAVE at any time, as long as you have filled out a bare minimum of the application. A Red * will appear next to those
fields that are required. Once you have successfully saved your application, you will be able to add federal and local funding sources by
pressing the newly visible ADD FEDERAL FUNDING SOURCE and ADD LOCAL FUNDING SOURCE buttons located at both the top
and bottom of the page. At this time you will also be able to upload documents to this application.
Trail Project Name:
Description of Proposed Project:
24
Property Location Information
Urban or Rural Development:
Urban
Address Line 1:
Address Line 2:
Either Choose a City or Select 'Other' and Type one in the Box Provided:
Abercrombie
If Other:
County:
Adams
State:
ND
Either Choose a Zip Code or Select 'Other' and Type one in the Box
Provided:
58001
If Other:
Township: N
Range: W
Township Section:
Township, Range & Section
Length of New Trail: (in miles)
Length of Total Trail (in miles) if
Project is an Extension:
General Funding and Property Information
Total Cost:
Fund Amount:
Is this Project an Extension to an Existing Trail Project?
Who Holds the Title to the Project Land?
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Yes
Projects must be completed within 18 months of grant award to meet
Federal Highway Administration Guidelines.
Estimated Start Date:
(mm/dd/yyyy)
Estimated End Date: (mm/dd/yyyy)
Classification of Land:
State
Federal
Local
Private
Check all of the uses the Project impacts:
Walking/Hiking
Country Skiing
In-line Skating
Motorcycling
Bicycling
Snowmobiling
Horseback Riding
ATV Riding
CrossOff-road
4x4 Trucking Other:
Does the Project fall substantially within a federal highway right-ofway?
Yes
SAVE
Federal Funding Sources __________________
Local Funding Sources ____________________
Adding sources to this section certifies that the sponsor has their share of money available and has earmarked these
funds for use on this project. It is necessary to have 20% of the total project cost available.
**All RTP projects must meet accessibility guidelines in compliance with the Americans with Disabilities Act of 1990,
Section 504 of the Rehabilitation Act of 1973 and the Architectural Barriers Act. For more information refer to the U.S.
Access Board at www.access-board.gov. Look for the Reg Neg Committee 1999 Report: Accessibility Guidelines for
Outdoor Developed Areas.
RequirementEach application must address each of the following requirements in the order they appear below:
1. A project description sufficient to understand the project. Indicate
prominently whether this is primarily a maintenance request, an
enhancement to an existing trail, new development, acquisition, length
26
2.
3.
4.
5.
6.
7.
8.
of trail etc. Please explain if the application is for one or more phases
of a multi-phase project.
Clearly defined goals for the project (with a delineation of which user
groups would benefit from the project).
Costs associated with the project (with estimates of the following
components: material/service purchases including hardware, paint,
lumber, sand/gravel concrete, landscape materials, signs,
design/engineering services and contractor services).
Evidence of local/area support (e.g., council resolutions, minutes of
public meetings, letters of support, etc.). Evidence of MPO support
must be included if applicable.
Availability/access to 20% match for eligible elements of the project
proposal. Matching funds must not be from other federal sources such
as Transportation Enhancement through the Department of
Transportation. A resolution from the sponsor of the project regarding
the availability of funds will be required prior to any award of a grant.
Identification of the sponsor of the project: This organization or unit
of government will be legally responsible for the project.
Evidence of applicant capability (e.g., ability to carry out project, and
for development projects, to operate, maintain, and protect trail and
facilities when completed).
Written Assurances (if applicable). Produce leases or written
assurances that the project will be open for public use.
Evaluation CriterionAll applications must address the following criteria in the order that they appear. Failure to provide this information may
result in the disqualification of this application.
1. Site and project quality: consideration of the needs of the intended
trail user group(s); aesthetic quality of the trail location;
appropriateness of the trail for the intended or existing uses; clarity,
detail, and quality of project plan/design; quality of existing
development (if any) on site or in corridor; attention to safety,
accessibility and health considerations.
2. Public need for and benefit of project: safety concerns, urgency of
action, potential to lose the opportunity, number of people who would
benefit from the project when compared to cost. Why should this
project be funded? How many people could be expected to use the
trail over the course of the year as a result of funding the project?
3. Context of the project in a wider plan: demonstrated compatibility
with local/region/area trail plans and the Statewide Comprehensive
Outdoor Recreation Plan. For proposed facilities, what relationship
does the proposed development/acquisition have to other outdoor
recreation facilities and trails?
4. Attention to the potential environmental impact of the project and
efforts to mitigate adverse effects: Possible areas of consideration
include but are not limited to: noise, odors, dust, surface erosion, fish
and wildlife populations, damage to wetlands, or other ecologically
sensitive natural resources or historical/archeological remains. A
27
cultural review letter or document should be included with the
application. All applications are subject to review by the State
Historical Society.
5. Impact on adjoining landowners in the vicinity of the project:
Identify adverse impacts that might be realized as a result of
completing the project, and how the projects design attempts to
mitigate adverse impacts. How might the project improve conditions
for adjacent landowners?
Certifications Regarding Debarment, Suspension and Other Responsibility Matters, Drug-Free Workplace
Requirements and Lobbying
Persons submitting this form should refer to the regulations referenced below for complete instructions:
Certification Regarding Debarment, Suspension, and Other Responsibility Matters – Primary Covered Transactions – The
prospective primary participant further agrees by submitting this proposal that it will include the clause titles, “Certification
Regarding Debarment, Suspension, Ineligibility and voluntary Exclusion – Lower Tier Covered Transaction,” provided by
the department or agency entering into this covered transaction, without modification, in all lower tier covered
transactions and in all solicitations for lower tier covered transactions. See below for language to be used; use this form
for certification and sign; Certification Regarding Drug- Free Workplace Requirements-Alternate I. (Grantees Other Than
Individuals) and Alternate II. (Grantees Who are Individuals) – (See Appendix C of Subpart D of 43 CFR Part 12)
Checking the boxes on this form and submitting it provides for compliance with certification requirements under 43 CFR
Parts 12 and 18. The certifications shall be treated as a material representation of fact upon which reliance will be placed
when the funding agency determines to award the covered transaction, grant, cooperative agreement or loan.
PART A: Certification Regarding Debarment, Suspension, and Other Responsibility Matters – Primary Covered
Transactions
CHECK IF THIS CERTIFICATION IS FOR A PRIMARY COVERED TRANSACTION AND IS APPLICABLE.
1. The prospective primary participant certifies to the best of its
knowledge and belief, that it and its principals:
1. Are not presently debarred, suspended, proposed for
debarment, declared ineligible, or voluntarily excluded from
covered transactions by any Federal department or agency;
2. Have not within a three-year period preceding this proposal
been convicted of or had a civil judgment rendered against
them for commission of fraud or a criminal offense in
connection with obtaining, attempting to obtain, or performing
a public (Federal, State or local) transaction or contract under a
public transaction; violation of Federal or State antitrust
statutes or commission of embezzlement, theft, forgery,
bribery, falsification or destruction of records, making false
statements, or receiving stolen property;
3. Are not presently indicted for or otherwise criminally or civilly
charged by a governmental entity (Federal, State or local) with
commission of any of the offenses enumerated in paragraph
(1)(b) of this certification; and
4. Have not within a three-year period preceding this
application/proposal had one or more public transactions
(Federal, State or local) terminated for cause or default
2. Where the prospective primary participant is unable to certify to any
of the statements in this certification, such prospective participant
shall attach an explanation to this proposal.
28
Part B: Certification Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion – Lower Tier
Covered Transactions
CHECK IF THIS CERTIFICATION IS FOR A LOWER TIER COVERED TRANSACTION AND IS APPLICABLE.
1. The prospective lower tier participant certifies, by submission of this
proposal, that neither it nor its principals is presently debarred,
suspended, proposed for debarment, declared ineligible, or voluntarily
excluded from participation in this transaction by any Federal
department or agency.
2. Where the prospective lower tier participant is unable to certify to any
of the statements in this certification, such prospective participant
shall attach an explanation to this proposal.
Part C: Certification Regarding Drug-Free Workplace Requirements
CHECK IF THIS CERTIFICATION IS FOR AN APPLICANT WHO IS NOT AN INDIVIDUAL
Alternate I. (Grantees Other Than Individuals)
1. The grantee certifies that it will or continue to provide a drug-free
workplace by:
1. (a) Publishing a statement notifying employees that the
unlawful manufacture, distribution, dispensing, possession, or
use of a controlled substance is prohibited in the grantee’s
workplace and specifying the actions that will be taken against
employees for violation of such prohibition;
2. (b) Establishing an ongoing drug-free awareness program to
inform employees about1. The dangers of drug abuse in the workplace;
2. The grantee’s policy of maintaining a drug-free
workplace;
3. Any available drug counseling, rehabilitation, and
employee assistance programs; and
4. The penalties that may be imposed upon employees for
drug abuse violations occurring in the workplace;
3. (c) Making it a requirement that each employee to be engaged
in the performance of the grant be given a copy of the
statement required by paragraph (a);
4. (d) Notifying the employee in the statement required by
paragraph (a) that, as a condition of employment under the
grant, the employee will –
1. Abide by the terms of the statement; and
2. Notify the employer in writing of his or her conviction
for a violation of a criminal drug statue occurring in the
workplace no later than five calendar days after such
conviction;
5. (e) Notifying the agency in writing, within 10 calendar days
after receiving notice under subparagraph (d)(2) from an
employee or otherwise receiving actual notice of such
conviction. Employers of convicted employees must provide
notice, including position title, to every grant officer on whose
grant activity the convicted employee was working, unless the
29
Federal agency has designated a central point for the receipt of
such notices. Notice shall include the identification numbers
(s) of each affected grant;
6. (f) Taking one of the following actions, within 30 calendar
days of receiving notice under subparagraph (d)(2), with
respect to any employee who is so convicted—
1. Taking appropriate personnel action against such an
employee, up to and including termination, consistent
with the requirements of the Rehabilitation Act of
1973, as amended; or
2. Requiring such employee to participate satisfactorily in
a drug abuse assistance or rehabilitation program
approved for such purposes by a Federal, State, or local
health, law enforcement, or other appropriate agency;
7. (g) Making a good faith effort to continue to maintain a drugfree workplace through implementation of paragraphs
(a),(b),(c),(d),(e) and (f).
2. The grantee may insert in the space provided below the site(s) for the
performance of work done in connection with the specific grant: Place
of Performance (Street address, city, county, state, zip code)
Address Line 1:
Address Line 2:
City:
State:
Zip:
Check if there are workplaces on file that are not identified here
Part D: Certification Regarding Drug-Free Workplace Requirements
CHECK IF THIS CERTIFICATION IS FOR AN APPLICANT WHO IS AN INDIVIDUAL
Alternate II. (Grantees Who Are Individuals)
1. The grantee certifies that, as a condition of the grant, he or she will not
engage in the unlawful manufacture, distribution, dispensing,
possession, or use of a controlled substance in conducting any activity
with the grant;
2. If convicted of a criminal drug offense resulting from a violation
occurring during the conduct of any grant activity, he or she will
report the conviction, in writing, within 10 calendar days of the
conviction, to the grant officer or other designee, unless the Federal
agency designates a central point for the receipt of such notices. When
notice is made to such a central point, it shall include the identification
number (s) of each affected grant.
Part E: Certification Regarding Lobbying
Certification for Contracts, Grants, Loans, and Cooperative
30
CHECK IF CERTIFICATION IS FOR THE AWARD OF ANY OF THE FOLLOWING AND THE AMOUNT
EXCEEDS $100,000: A FEDERAL GRANT OR COOPERATIVE AGREEMENT; SUBCONTRACT, OR SUBGRANT
UNDER THE GRANT OR COOPERATIVE AGREEMENT.
CHECK IF CERTIFICATION IS FOR THE AWARD OF A FEDERAL LOAN EXCEEDING THE AMOUNT OF
$150,000, OR A SUBGRANT OR SUBCONTRACT EXCEEDING $100,000, UNDER THE LOAN
The undersigned certifies, to the best of his or her knowledge and belief, that:
1. No federal appropriated funds have been paid or will be paid, by or on
behalf of the undersigned, to any person for influencing or attempting
to influence an agency, a Member of Congress, and officer or
employee of Congress, or an employee of a Member of Congress in
connection with the awarding of any cooperative agreement, and the
extension, continuation, renewal, amendment, or modification of any
Federal contract, grant, load, or cooperative agreement.
2. If any funds other than Federal appropriated funds have been paid or
will be paid to any person for influencing or attempting to influence
an officer or employee of any agency, a Member of Congress, an
officer or employee of Congress, or an employee of a Member of
Congress in connection with this Federal contract, grant, loan, or
cooperative agreement, the undersigned shall complete and submit
Standard Form-LL, “Disclosure Form to Report Lobbying,” in
accordance with its instructions.
3. The undersigned shall require that the language of this certification be
included in the award documents for all subawards at all tiers
(including subcontracts, subgrants, and contracts under grants, loans,
and cooperative agreements) and that all subrecipients shall certify
accordingly.
This certification is a material representation of fact upon which reliance was placed when this transaction was made or
entered unto. Submission of this certification is a prerequisite for making or entering into this transaction imposed by
Section 1352, title 31, U.S. Code. Any person who fails to tile the required certification shall be subject to a civil penalty of
not less than $10,000 and not more than $100,000 for each such failure.
As the authorized certifying official, I hereby certify that the above specified certifications are true.
SAVE
SUBMIT FOR REVIEW
Once all required and support documentation has been uploaded and you are satisfied with the information
entered in the application, click submit for review and final submission.
31
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Attachment B: FHWA 1273 Synopsis
REQUIRED CONTRACT PROVISIONS FEDERAL-AID
CONSTRUCTION CONTRACTS (FHWA 1273)
APPLIES TO CONTRACTS AND RELATED SUBCONTRACTS:
ALL
Section I – General
Section VII - Subletting or Assigning the Contract
Section VIII - Safety: Accident Prevention
Section IX - False Statements Concerning Highway Projects
Section XI – Certification regarding Debarment, Suspension,
Ineligibility and Voluntary Exclusion
$10,000 or MORE
Section II - Nondiscrimination
Section III – Nonsegregated Facilities
> $2K and within the RIGHT-OFWAY of a FEDERAL-AID
HIGHWAY (*)
Section IV - Payment of Predetermined Minimum Wage
Section V - Statements and Payrolls
$100K or MORE
Section X – Implementation of Clean Air Act and Federal
Water Pollution Control Act
Section XII – Certification Regarding Use of Contract Funds
for Lobbying
N/A
Section VI - Record of Materials, Supplies, and Labor
Attachment A – Employment Preference for Appalachian
Contracts
*CONTACT FHWA FOR CLASSIFICATION DETERMINATIONS
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Attachment C: FHWA Form 1273
FHWA-1273 -- Revised May 1, 2012
REQUIRED CONTRACT PROVISIONS
FEDERAL-AID CONSTRUCTION CONTRACTS
I. General
II. Nondiscrimination
III. Nonsegregated Facilities
IV. Davis-Bacon and Related Act Provisions
V. Contract Work Hours and Safety Standards Act Provisions
VI. Subletting or Assigning the Contract
VII. Safety: Accident Prevention
VIII. False Statements Concerning Highway Projects
IX. Implementation of Clean Air Act and Federal Water Pollution Control Act
X. Compliance with Governmentwide Suspension and Debarment Requirements
XI. Certification Regarding Use of Contract Funds for Lobbying
ATTACHMENTS
A. Employment and Materials Preference for Appalachian Development Highway System or
Appalachian Local Access Road Contracts (included in Appalachian contracts only)
I. GENERAL
1. Form FHWA-1273 must be physically incorporated in each construction contract funded
under Title 23 (excluding emergency contracts solely intended for debris removal). The
contractor (or subcontractor) must insert this form in each subcontract and further require its
inclusion in all lower tier subcontracts (excluding purchase orders, rental agreements and other
agreements for supplies or services).
The applicable requirements of Form FHWA-1273 are incorporated by reference for work done
under any purchase order, rental agreement or agreement for other services. The prime
contractor shall be responsible for compliance by any subcontractor, lower-tier subcontractor or
service provider.
Form FHWA-1273 must be included in all Federal-aid design-build contracts, in all subcontracts
and in lower tier subcontracts (excluding subcontracts for design services, purchase orders, rental
agreements and other agreements for supplies or services). The design-builder shall be
responsible for compliance by any subcontractor, lower-tier subcontractor or service provider.
Contracting agencies may reference Form FHWA-1273 in bid proposal or request for proposal
documents, however, the Form FHWA-1273 must be physically incorporated (not referenced) in
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all contracts, subcontracts and lower-tier subcontracts (excluding purchase orders, rental
agreements and other agreements for supplies or services related to a construction contract).
2. Subject to the applicability criteria noted in the following sections, these contract provisions
shall apply to all work performed on the contract by the contractor's own organization and with
the assistance of workers under the contractor's immediate superintendence and to all work
performed on the contract by piecework, station work, or by subcontract.
3. A breach of any of the stipulations contained in these Required Contract Provisions may be
sufficient grounds for withholding of progress payments, withholding of final payment,
termination of the contract, suspension / debarment or any other action determined to be
appropriate by the contracting agency and FHWA.
4. Selection of Labor: During the performance of this contract, the contractor shall not use
convict labor for any purpose within the limits of a construction project on a Federal-aid
highway unless it is labor performed by convicts who are on parole, supervised release, or
probation. The term Federal-aid highway does not include roadways functionally classified as
local roads or rural minor collectors.
II. NONDISCRIMINATION
The provisions of this section related to 23 CFR Part 230 are applicable to all Federal-aid
construction contracts and to all related construction subcontracts of $10,000 or more. The
provisions of 23 CFR Part 230 are not applicable to material supply, engineering, or architectural
service contracts.
In addition, the contractor and all subcontractors must comply with the following policies:
Executive Order 11246, 41 CFR 60, 29 CFR 1625-1627, Title 23 USC Section 140, the
Rehabilitation Act of 1973, as amended (29 USC 794), Title VI of the Civil Rights Act of 1964,
as amended, and related regulations including 49 CFR Parts 21, 26 and 27; and 23 CFR Parts
200, 230, and 633.
The contractor and all subcontractors must comply with: the requirements of the Equal
Opportunity Clause in 41 CFR 60-1.4(b) and, for all construction contracts exceeding $10,000,
the Standard Federal Equal Employment Opportunity Construction Contract Specifications in 41
CFR 60-4.3.
Note: The U.S. Department of Labor has exclusive authority to determine compliance with
Executive Order 11246 and the policies of the Secretary of Labor including 41 CFR 60, and 29
CFR 1625-1627. The contracting agency and the FHWA have the authority and the
responsibility to ensure compliance with Title 23 USC Section 140, the Rehabilitation Act of
1973, as amended (29 USC 794), and Title VI of the Civil Rights Act of 1964, as amended, and
related regulations including 49 CFR Parts 21, 26 and 27; and 23 CFR Parts 200, 230, and 633.
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The following provision is adopted from 23 CFR 230, Appendix A, with appropriate revisions to
conform to the U.S. Department of Labor (US DOL) and FHWA requirements.
1. Equal Employment Opportunity: Equal employment opportunity (EEO) requirements not to
discriminate and to take affirmative action to assure equal opportunity as set forth under laws,
executive orders, rules, regulations (28 CFR 35, 29 CFR 1630, 29 CFR 1625-1627, 41 CFR 60
and 49 CFR 27) and orders of the Secretary of Labor as modified by the provisions prescribed
herein, and imposed pursuant to 23 U.S.C. 140 shall constitute the EEO and specific affirmative
action standards for the contractor's project activities under this contract. The provisions of the
Americans with Disabilities Act of 1990 (42 U.S.C. 12101 et seq.) set forth under 28 CFR 35
and 29 CFR 1630 are incorporated by reference in this contract. In the execution of this contract,
the contractor agrees to comply with the following minimum specific requirement activities of
EEO:
a. The contractor will work with the contracting agency and the Federal Government to ensure
that it has made every good faith effort to provide equal opportunity with respect to all of its
terms and conditions of employment and in their review of activities under the contract.
b. The contractor will accept as its operating policy the following statement:
"It is the policy of this Company to assure that applicants are employed, and that employees
are treated during employment, without regard to their race, religion, sex, color, national origin,
age or disability. Such action shall include: employment, upgrading, demotion, or transfer;
recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of
compensation; and selection for training, including apprenticeship, pre-apprenticeship, and/or
on-the-job training."
2. EEO Officer: The contractor will designate and make known to the contracting officers an
EEO Officer who will have the responsibility for and must be capable of effectively
administering and promoting an active EEO program and who must be assigned adequate
authority and responsibility to do so.
3. Dissemination of Policy: All members of the contractor's staff who are authorized to hire,
supervise, promote, and discharge employees, or who recommend such action, or who are
substantially involved in such action, will be made fully cognizant of, and will implement, the
contractor's EEO policy and contractual responsibilities to provide EEO in each grade and
classification of employment. To ensure that the above agreement will be met, the following
actions will be taken as a minimum:
a. Periodic meetings of supervisory and personnel office employees will be conducted before
the start of work and then not less often than once every six months, at which time the
contractor's EEO policy and its implementation will be reviewed and explained. The meetings
will be conducted by the EEO Officer.
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b. All new supervisory or personnel office employees will be given a thorough indoctrination
by the EEO Officer, covering all major aspects of the contractor's EEO obligations within thirty
days following their reporting for duty with the contractor.
c. All personnel who are engaged in direct recruitment for the project will be instructed by the
EEO Officer in the contractor's procedures for locating and hiring minorities and women.
d. Notices and posters setting forth the contractor's EEO policy will be placed in areas readily
accessible to employees, applicants for employment and potential employees.
e. The contractor's EEO policy and the procedures to implement such policy will be brought to
the attention of employees by means of meetings, employee handbooks, or other appropriate
means.
4. Recruitment: When advertising for employees, the contractor will include in all
advertisements for employees the notation: "An Equal Opportunity Employer." All such
advertisements will be placed in publications having a large circulation among minorities and
women in the area from which the project work force would normally be derived.
a. The contractor will, unless precluded by a valid bargaining agreement, conduct systematic
and direct recruitment through public and private employee referral sources likely to yield
qualified minorities and women. To meet this requirement, the contractor will identify sources
of potential minority group employees, and establish with such identified sources procedures
whereby minority and women applicants may be referred to the contractor for employment
consideration.
b. In the event the contractor has a valid bargaining agreement providing for exclusive hiring
hall referrals, the contractor is expected to observe the provisions of that agreement to the extent
that the system meets the contractor's compliance with EEO contract provisions. Where
implementation of such an agreement has the effect of discriminating against minorities or
women, or obligates the contractor to do the same, such implementation violates Federal
nondiscrimination provisions.
c. The contractor will encourage its present employees to refer minorities and women as
applicants for employment. Information and procedures with regard to referring such applicants
will be discussed with employees.
5. Personnel Actions: Wages, working conditions, and employee benefits shall be established
and administered, and personnel actions of every type, including hiring, upgrading, promotion,
transfer, demotion, layoff, and termination, shall be taken without regard to race, color, religion,
sex, national origin, age or disability. The following procedures shall be followed:
a. The contractor will conduct periodic inspections of project sites to insure that working
conditions and employee facilities do not indicate discriminatory treatment of project site
personnel.
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b. The contractor will periodically evaluate the spread of wages paid within each classification
to determine any evidence of discriminatory wage practices.
c. The contractor will periodically review selected personnel actions in depth to determine
whether there is evidence of discrimination. Where evidence is found, the contractor will
promptly take corrective action. If the review indicates that the discrimination may extend
beyond the actions reviewed, such corrective action shall include all affected persons.
d. The contractor will promptly investigate all complaints of alleged discrimination made to
the contractor in connection with its obligations under this contract, will attempt to resolve such
complaints, and will take appropriate corrective action within a reasonable time. If the
investigation indicates that the discrimination may affect persons other than the complainant,
such corrective action shall include such other persons. Upon completion of each investigation,
the contractor will inform every complainant of all of their avenues of appeal.
6. Training and Promotion:
a. The contractor will assist in locating, qualifying, and increasing the skills of minorities and
women who are applicants for employment or current employees. Such efforts should be aimed
at developing full journey level status employees in the type of trade or job classification
involved.
b. Consistent with the contractor's work force requirements and as permissible under Federal
and State regulations, the contractor shall make full use of training programs, i.e., apprenticeship,
and on-the-job training programs for the geographical area of contract performance. In the event
a special provision for training is provided under this contract, this subparagraph will be
superseded as indicated in the special provision. The contracting agency may reserve training
positions for persons who receive welfare assistance in accordance with 23 U.S.C. 140(a).
c. The contractor will advise employees and applicants for employment of available training
programs and entrance requirements for each.
d. The contractor will periodically review the training and promotion potential of employees
who are minorities and women and will encourage eligible employees to apply for such training
and promotion.
7. Unions: If the contractor relies in whole or in part upon unions as a source of employees, the
contractor will use good faith efforts to obtain the cooperation of such unions to increase
opportunities for minorities and women. Actions by the contractor, either directly or through a
contractor's association acting as agent, will include the procedures set forth below:
a. The contractor will use good faith efforts to develop, in cooperation with the unions, joint
training programs aimed toward qualifying more minorities and women for membership in the
unions and increasing the skills of minorities and women so that they may qualify for higher
paying employment.
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b. The contractor will use good faith efforts to incorporate an EEO clause into each union
agreement to the end that such union will be contractually bound to refer applicants without
regard to their race, color, religion, sex, national origin, age or disability.
c. The contractor is to obtain information as to the referral practices and policies of the labor
union except that to the extent such information is within the exclusive possession of the labor
union and such labor union refuses to furnish such information to the contractor, the contractor
shall so certify to the contracting agency and shall set forth what efforts have been made to
obtain such information.
d. In the event the union is unable to provide the contractor with a reasonable flow of referrals
within the time limit set forth in the collective bargaining agreement, the contractor will, through
independent recruitment efforts, fill the employment vacancies without regard to race, color,
religion, sex, national origin, age or disability; making full efforts to obtain qualified and/or
qualifiable minorities and women. The failure of a union to provide sufficient referrals (even
though it is obligated to provide exclusive referrals under the terms of a collective bargaining
agreement) does not relieve the contractor from the requirements of this paragraph. In the event
the union referral practice prevents the contractor from meeting the obligations pursuant to
Executive Order 11246, as amended, and these special provisions, such contractor shall
immediately notify the contracting agency.
8. Reasonable Accommodation for Applicants / Employees with Disabilities: The contractor
must be familiar with the requirements for and comply with the Americans with Disabilities Act
and all rules and regulations established there under. Employers must provide reasonable
accommodation in all employment activities unless to do so would cause an undue hardship.
9. Selection of Subcontractors, Procurement of Materials and Leasing of Equipment: The
contractor shall not discriminate on the grounds of race, color, religion, sex, national origin, age
or disability in the selection and retention of subcontractors, including procurement of materials
and leases of equipment. The contractor shall take all necessary and reasonable steps to ensure
nondiscrimination in the administration of this contract.
a. The contractor shall notify all potential subcontractors and suppliers and lessors of their
EEO obligations under this contract.
b. The contractor will use good faith efforts to ensure subcontractor compliance with their
EEO obligations.
10.
Assurance Required by 49 CFR 26.13(b):
a.
The requirements of 49 CFR Part 26 and the State DOT’s U.S. DOT-approved DBE
program are incorporated by reference.
b.
The contractor or subcontractor shall not discriminate on the basis of race, color,
national origin, or sex in the performance of this contract. The contractor shall carry out
applicable requirements of 49 CFR Part 26 in the award and administration of DOT-assisted
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contracts. Failure by the contractor to carry out these requirements is a material breach of this
contract, which may result in the termination of this contract or such other remedy as the
contracting agency deems appropriate.
11. Records and Reports: The contractor shall keep such records as necessary to document
compliance with the EEO requirements. Such records shall be retained for a period of three
years following the date of the final payment to the contractor for all contract work and shall be
available at reasonable times and places for inspection by authorized representatives of the
contracting agency and the FHWA.
a. The records kept by the contractor shall document the following:
(1) The number and work hours of minority and non-minority group members and
women employed in each work classification on the project;
(2) The progress and efforts being made in cooperation with unions, when applicable, to
increase employment opportunities for minorities and women; and
(3) The progress and efforts being made in locating, hiring, training, qualifying, and
upgrading minorities and women;
b. The contractors and subcontractors will submit an annual report to the contracting agency
each July for the duration of the project, indicating the number of minority, women, and nonminority group employees currently engaged in each work classification required by the contract
work. This information is to be reported on Form FHWA-1391. The staffing data should
represent the project work force on board in all or any part of the last payroll period preceding
the end of July. If on-the-job training is being required by special provision, the contractor will
be required to collect and report training data. The employment data should reflect the work
force on board during all or any part of the last payroll period preceding the end of July.
III. NONSEGREGATED FACILITIES
This provision is applicable to all Federal-aid construction contracts and to all related
construction subcontracts of $10,000 or more.
The contractor must ensure that facilities provided for employees are provided in such a manner
that segregation on the basis of race, color, religion, sex, or national origin cannot result. The
contractor may neither require such segregated use by written or oral policies nor tolerate such
use by employee custom. The contractor's obligation extends further to ensure that its employees
are not assigned to perform their services at any location, under the contractor's control, where
the facilities are segregated. The term "facilities" includes waiting rooms, work areas,
restaurants and other eating areas, time clocks, restrooms, washrooms, locker rooms, and other
storage or dressing areas, parking lots, drinking fountains, recreation or entertainment areas,
transportation, and housing provided for employees. The contractor shall provide separate or
single-user restrooms and necessary dressing or sleeping areas to assure privacy between sexes.
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IV. DAVIS-BACON AND RELATED ACT PROVISIONS
This section is applicable to all Federal-aid construction projects exceeding $2,000 and to all
related subcontracts and lower-tier subcontracts (regardless of subcontract size). The
requirements apply to all projects located within the right-of-way of a roadway that is
functionally classified as Federal-aid highway. This excludes roadways functionally classified as
local roads or rural minor collectors, which are exempt. Contracting agencies may elect to apply
these requirements to other projects.
The following provisions are from the U.S. Department of Labor regulations in 29 CFR 5.5
“Contract provisions and related matters” with minor revisions to conform to the FHWA-1273
format and FHWA program requirements.
1. Minimum wages
a. All laborers and mechanics employed or working upon the site of the work, will be paid
unconditionally and not less often than once a week, and without subsequent deduction or rebate
on any account (except such payroll deductions as are permitted by regulations issued by the
Secretary of Labor under the Copeland Act (29 CFR part 3)), the full amount of wages and bona
fide fringe benefits (or cash equivalents thereof) due at time of payment computed at rates not
less than those contained in the wage determination of the Secretary of Labor which is attached
hereto and made a part hereof, regardless of any contractual relationship which may be alleged to
exist between the contractor and such laborers and mechanics.
Contributions made or costs reasonably anticipated for bona fide fringe benefits under section
1(b)(2) of the Davis-Bacon Act on behalf of laborers or mechanics are considered wages paid to
such laborers or mechanics, subject to the provisions of paragraph 1.d. of this section; also,
regular contributions made or costs incurred for more than a weekly period (but not less often
than quarterly) under plans, funds, or programs which cover the particular weekly period, are
deemed to be constructively made or incurred during such weekly period. Such laborers and
mechanics shall be paid the appropriate wage rate and fringe benefits on the wage determination
for the classification of work actually performed, without regard to skill, except as provided in
29 CFR 5.5(a)(4). Laborers or mechanics performing work in more than one classification may
be compensated at the rate specified for each classification for the time actually worked therein:
Provided, That the employer's payroll records accurately set forth the time spent in each
classification in which work is performed. The wage determination (including any additional
classification and wage rates conformed under paragraph 1.b. of this section) and the DavisBacon poster (WH–1321) shall be posted at all times by the contractor and its subcontractors at
the site of the work in a prominent and accessible place where it can be easily seen by the
workers.
b.
(1) The contracting officer shall require that any class of laborers or mechanics, including
helpers, which is not listed in the wage determination and which is to be employed under the
contract shall be classified in conformance with the wage determination. The contracting officer
shall approve an additional classification and wage rate and fringe benefits therefore only when
the following criteria have been met:
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(i) The work to be performed by the classification requested is not performed by a
classification in the wage determination; and
(ii) The classification is utilized in the area by the construction industry; and
(iii) The proposed wage rate, including any bona fide fringe benefits, bears a reasonable
relationship to the wage rates contained in the wage determination.
(2) If the contractor and the laborers and mechanics to be employed in the classification (if
known), or their representatives, and the contracting officer agree on the classification and
wage rate (including the amount designated for fringe benefits where appropriate), a report of
the action taken shall be sent by the contracting officer to the Administrator of the Wage and
Hour Division, Employment Standards Administration, U.S. Department of Labor,
Washington, DC 20210. The Administrator, or an authorized representative, will approve,
modify, or disapprove every additional classification action within 30 days of receipt and so
advise the contracting officer or will notify the contracting officer within the 30-day period that
additional time is necessary.
(3) In the event the contractor, the laborers or mechanics to be employed in the classification
or their representatives, and the contracting officer do not agree on the proposed classification
and wage rate (including the amount designated for fringe benefits, where appropriate), the
contracting officer shall refer the questions, including the views of all interested parties and the
recommendation of the contracting officer, to the Wage and Hour Administrator for
determination. The Wage and Hour Administrator, or an authorized representative, will issue a
determination within 30 days of receipt and so advise the contracting officer or will notify the
contracting officer within the 30-day period that additional time is necessary.
(4) The wage rate (including fringe benefits where appropriate) determined pursuant to
paragraphs 1.b.(2) or 1.b.(3) of this section, shall be paid to all workers performing work in the
classification under this contract from the first day on which work is performed in the
classification.
c. Whenever the minimum wage rate prescribed in the contract for a class of laborers or
mechanics includes a fringe benefit which is not expressed as an hourly rate, the contractor shall
either pay the benefit as stated in the wage determination or shall pay another bona fide fringe
benefit or an hourly cash equivalent thereof.
d. If the contractor does not make payments to a trustee or other third person, the contractor
may consider as part of the wages of any laborer or mechanic the amount of any costs reasonably
anticipated in providing bona fide fringe benefits under a plan or program, Provided, That the
Secretary of Labor has found, upon the written request of the contractor, that the applicable
standards of the Davis-Bacon Act have been met. The Secretary of Labor may require the
contractor to set aside in a separate account assets for the meeting of obligations under the plan
or program.
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2. Withholding
The contracting agency shall upon its own action or upon written request of an authorized
representative of the Department of Labor, withhold or cause to be withheld from the contractor
under this contract, or any other Federal contract with the same prime contractor, or any other
federally-assisted contract subject to Davis-Bacon prevailing wage requirements, which is held
by the same prime contractor, so much of the accrued payments or advances as may be
considered necessary to pay laborers and mechanics, including apprentices, trainees, and helpers,
employed by the contractor or any subcontractor the full amount of wages required by the
contract. In the event of failure to pay any laborer or mechanic, including any apprentice,
trainee, or helper, employed or working on the site of the work, all or part of the wages required
by the contract, the contracting agency may, after written notice to the contractor, take such
action as may be necessary to cause the suspension of any further payment, advance, or
guarantee of funds until such violations have ceased.
3. Payrolls and basic records
a. Payrolls and basic records relating thereto shall be maintained by the contractor during the
course of the work and preserved for a period of three years thereafter for all laborers and
mechanics working at the site of the work. Such records shall contain the name, address, and
social security number of each such worker, his or her correct classification, hourly rates of
wages paid (including rates of contributions or costs anticipated for bona fide fringe benefits or
cash equivalents thereof of the types described in section 1(b)(2)(B) of the Davis-Bacon Act),
daily and weekly number of hours worked, deductions made and actual wages paid. Whenever
the Secretary of Labor has found under 29 CFR 5.5(a)(1)(iv) that the wages of any laborer or
mechanic include the amount of any costs reasonably anticipated in providing benefits under a
plan or program described in section 1(b)(2)(B) of the Davis-Bacon Act, the contractor shall
maintain records which show that the commitment to provide such benefits is enforceable, that
the plan or program is financially responsible, and that the plan or program has been
communicated in writing to the laborers or mechanics affected, and records which show the costs
anticipated or the actual cost incurred in providing such benefits. Contractors employing
apprentices or trainees under approved programs shall maintain written evidence of the
registration of apprenticeship programs and certification of trainee programs, the registration of
the apprentices and trainees, and the ratios and wage rates prescribed in the applicable programs.
b.
(1) The contractor shall submit weekly for each week in which any contract work is
performed a copy of all payrolls to the contracting agency. The payrolls submitted shall set out
accurately and completely all of the information required to be maintained under 29 CFR
5.5(a)(3)(i), except that full social security numbers and home addresses shall not be included on
weekly transmittals. Instead the payrolls shall only need to include an individually identifying
number for each employee ( e.g. , the last four digits of the employee's social security number).
The required weekly payroll information may be submitted in any form desired. Optional Form
WH–347 is available for this purpose from the Wage and Hour Division Web site at
http://www.dol.gov/esa/whd/forms/wh347instr.htm or its successor site. The prime contractor is
responsible for the submission of copies of payrolls by all subcontractors. Contractors and
subcontractors shall maintain the full social security number and current address of each covered
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worker, and shall provide them upon request to the contracting agency for transmission to the
State DOT, the FHWA or the Wage and Hour Division of the Department of Labor for purposes
of an investigation or audit of compliance with prevailing wage requirements. It is not a violation
of this section for a prime contractor to require a subcontractor to provide addresses and social
security numbers to the prime contractor for its own records, without weekly submission to the
contracting agency..
(2) Each payroll submitted shall be accompanied by a “Statement of Compliance,” signed by the
contractor or subcontractor or his or her agent who pays or supervises the payment of the persons
employed under the contract and shall certify the following:
(i) That the payroll for the payroll period contains the information required to be provided
under §5.5 (a)(3)(ii) of Regulations, 29 CFR part 5, the appropriate information is being
maintained under §5.5 (a)(3)(i) of Regulations, 29 CFR part 5, and that such information is
correct and complete;
(ii) That each laborer or mechanic (including each helper, apprentice, and trainee) employed
on the contract during the payroll period has been paid the full weekly wages earned, without
rebate, either directly or indirectly, and that no deductions have been made either directly or
indirectly from the full wages earned, other than permissible deductions as set forth in
Regulations, 29 CFR part 3;
(iii) That each laborer or mechanic has been paid not less than the applicable wage rates and
fringe benefits or cash equivalents for the classification of work performed, as specified in the
applicable wage determination incorporated into the contract.
(3) The weekly submission of a properly executed certification set forth on the reverse side of
Optional Form WH–347 shall satisfy the requirement for submission of the “Statement of
Compliance” required by paragraph 3.b.(2) of this section.
(4) The falsification of any of the above certifications may subject the contractor or
subcontractor to civil or criminal prosecution under section 1001 of title 18 and section 231 of
title 31 of the United States Code.
c. The contractor or subcontractor shall make the records required under paragraph 3.a. of this
section available for inspection, copying, or transcription by authorized representatives of the
contracting agency, the State DOT, the FHWA, or the Department of Labor, and shall permit
such representatives to interview employees during working hours on the job. If the contractor or
subcontractor fails to submit the required records or to make them available, the FHWA may,
after written notice to the contractor, the contracting agency or the State DOT, take such action
as may be necessary to cause the suspension of any further payment, advance, or guarantee of
funds. Furthermore, failure to submit the required records upon request or to make such records
available may be grounds for debarment action pursuant to 29 CFR 5.12.
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4. Apprentices and trainees
a. Apprentices (programs of the USDOL).
Apprentices will be permitted to work at less than the predetermined rate for the work they
performed when they are employed pursuant to and individually registered in a bona fide
apprenticeship program registered with the U.S. Department of Labor, Employment and Training
Administration, Office of Apprenticeship Training, Employer and Labor Services, or with a State
Apprenticeship Agency recognized by the Office, or if a person is employed in his or her first 90
days of probationary employment as an apprentice in such an apprenticeship program, who is not
individually registered in the program, but who has been certified by the Office of
Apprenticeship Training, Employer and Labor Services or a State Apprenticeship Agency (where
appropriate) to be eligible for probationary employment as an apprentice.
The allowable ratio of apprentices to journeymen on the job site in any craft classification shall
not be greater than the ratio permitted to the contractor as to the entire work force under the
registered program. Any worker listed on a payroll at an apprentice wage rate, who is not
registered or otherwise employed as stated above, shall be paid not less than the applicable wage
rate on the wage determination for the classification of work actually performed. In addition, any
apprentice performing work on the job site in excess of the ratio permitted under the registered
program shall be paid not less than the applicable wage rate on the wage determination for the
work actually performed. Where a contractor is performing construction on a project in a locality
other than that in which its program is registered, the ratios and wage rates (expressed in
percentages of the journeyman's hourly rate) specified in the contractor's or subcontractor's
registered program shall be observed.
Every apprentice must be paid at not less than the rate specified in the registered program for the
apprentice's level of progress, expressed as a percentage of the journeymen hourly rate specified
in the applicable wage determination. Apprentices shall be paid fringe benefits in accordance
with the provisions of the apprenticeship program. If the apprenticeship program does not
specify fringe benefits, apprentices must be paid the full amount of fringe benefits listed on the
wage determination for the applicable classification. If the Administrator determines that a
different practice prevails for the applicable apprentice classification, fringes shall be paid in
accordance with that determination.
In the event the Office of Apprenticeship Training, Employer and Labor Services, or a State
Apprenticeship Agency recognized by the Office, withdraws approval of an apprenticeship
program, the contractor will no longer be permitted to utilize apprentices at less than the
applicable predetermined rate for the work performed until an acceptable program is approved.
b. Trainees (programs of the USDOL).
Except as provided in 29 CFR 5.16, trainees will not be permitted to work at less than the
predetermined rate for the work performed unless they are employed pursuant to and
individually registered in a program which has received prior approval, evidenced by formal
certification by the U.S. Department of Labor, Employment and Training Administration.
45
The ratio of trainees to journeymen on the job site shall not be greater than permitted under the
plan approved by the Employment and Training Administration.
Every trainee must be paid at not less than the rate specified in the approved program for the
trainee's level of progress, expressed as a percentage of the journeyman hourly rate specified in
the applicable wage determination. Trainees shall be paid fringe benefits in accordance with the
provisions of the trainee program. If the trainee program does not mention fringe benefits,
trainees shall be paid the full amount of fringe benefits listed on the wage determination unless
the Administrator of the Wage and Hour Division determines that there is an apprenticeship
program associated with the corresponding journeyman wage rate on the wage determination
which provides for less than full fringe benefits for apprentices. Any employee listed on the
payroll at a trainee rate who is not registered and participating in a training plan approved by the
Employment and Training Administration shall be paid not less than the applicable wage rate on
the wage determination for the classification of work actually performed. In addition, any trainee
performing work on the job site in excess of the ratio permitted under the registered program
shall be paid not less than the applicable wage rate on the wage determination for the work
actually performed.
In the event the Employment and Training Administration withdraws approval of a training
program, the contractor will no longer be permitted to utilize trainees at less than the applicable
predetermined rate for the work performed until an acceptable program is approved.
c. Equal employment opportunity. The utilization of apprentices, trainees and journeymen
under this part shall be in conformity with the equal employment opportunity requirements of
Executive Order 11246, as amended, and 29 CFR part 30.
d. Apprentices and Trainees (programs of the U.S. DOT).
Apprentices and trainees working under apprenticeship and skill training programs which have
been certified by the Secretary of Transportation as promoting EEO in connection with Federalaid highway construction programs are not subject to the requirements of paragraph 4 of this
Section IV. The straight time hourly wage rates for apprentices and trainees under such programs
will be established by the particular programs. The ratio of apprentices and trainees to
journeymen shall not be greater than permitted by the terms of the particular program.
5. Compliance with Copeland Act requirements. The contractor shall comply with the
requirements of 29 CFR part 3, which are incorporated by reference in this contract.
6. Subcontracts. The contractor or subcontractor shall insert Form FHWA-1273 in any
subcontracts and also require the subcontractors to include Form FHWA-1273 in any lower tier
subcontracts. The prime contractor shall be responsible for the compliance by any subcontractor
or lower tier subcontractor with all the contract clauses in 29 CFR 5.5.
7. Contract termination: debarment. A breach of the contract clauses in 29 CFR 5.5 may be
grounds for termination of the contract, and for debarment as a contractor and a subcontractor as
provided in 29 CFR 5.12.
46
8. Compliance with Davis-Bacon and Related Act requirements. All rulings and
interpretations of the Davis-Bacon and Related Acts contained in 29 CFR parts 1, 3, and 5 are
herein incorporated by reference in this contract.
9. Disputes concerning labor standards. Disputes arising out of the labor standards provisions
of this contract shall not be subject to the general disputes clause of this contract. Such disputes
shall be resolved in accordance with the procedures of the Department of Labor set forth in 29
CFR parts 5, 6, and 7. Disputes within the meaning of this clause include disputes between the
contractor (or any of its subcontractors) and the contracting agency, the U.S. Department of
Labor, or the employees or their representatives.
10. Certification of eligibility.
a. By entering into this contract, the contractor certifies that neither it (nor he or she) nor any
person or firm who has an interest in the contractor's firm is a person or firm ineligible to be
awarded Government contracts by virtue of section 3(a) of the Davis-Bacon Act or 29 CFR
5.12(a)(1).
b. No part of this contract shall be subcontracted to any person or firm ineligible for award of a
Government contract by virtue of section 3(a) of the Davis-Bacon Act or 29 CFR 5.12(a)(1).
c. The penalty for making false statements is prescribed in the U.S. Criminal Code, 18 U.S.C.
1001.
V. CONTRACT WORK HOURS AND SAFETY STANDARDS ACT
The following clauses apply to any Federal-aid construction contract in an amount in excess of
$100,000 and subject to the overtime provisions of the Contract Work Hours and Safety
Standards Act. These clauses shall be inserted in addition to the clauses required by 29 CFR
5.5(a) or 29 CFR 4.6. As used in this paragraph, the terms laborers and mechanics include
watchmen and guards.
1. Overtime requirements. No contractor or subcontractor contracting for any part of the
contract work which may require or involve the employment of laborers or mechanics shall
require or permit any such laborer or mechanic in any workweek in which he or she is employed
on such work to work in excess of forty hours in such workweek unless such laborer or mechanic
receives compensation at a rate not less than one and one-half times the basic rate of pay for all
hours worked in excess of forty hours in such workweek.
2. Violation; liability for unpaid wages; liquidated damages. In the event of any violation of
the clause set forth in paragraph (1.) of this section, the contractor and any subcontractor
responsible therefor shall be liable for the unpaid wages. In addition, such contractor and
subcontractor shall be liable to the United States (in the case of work done under contract for the
District of Columbia or a territory, to such District or to such territory), for liquidated damages.
Such liquidated damages shall be computed with respect to each individual laborer or mechanic,
47
including watchmen and guards, employed in violation of the clause set forth in paragraph (1.) of
this section, in the sum of $10 for each calendar day on which such individual was required or
permitted to work in excess of the standard workweek of forty hours without payment of the
overtime wages required by the clause set forth in paragraph (1.) of this section.
3. Withholding for unpaid wages and liquidated damages. The FHWA or the contacting
agency shall upon its own action or upon written request of an authorized representative of the
Department of Labor withhold or cause to be withheld, from any moneys payable on account of
work performed by the contractor or subcontractor under any such contract or any other Federal
contract with the same prime contractor, or any other federally-assisted contract subject to the
Contract Work Hours and Safety Standards Act, which is held by the same prime contractor,
such sums as may be determined to be necessary to satisfy any liabilities of such contractor or
subcontractor for unpaid wages and liquidated damages as provided in the clause set forth in
paragraph (2.) of this section.
4. Subcontracts. The contractor or subcontractor shall insert in any subcontracts the clauses set
forth in paragraph (1.) through (4.) of this section and also a clause requiring the subcontractors
to include these clauses in any lower tier subcontracts. The prime contractor shall be responsible
for compliance by any subcontractor or lower tier subcontractor with the clauses set forth in
paragraphs (1.) through (4.) of this section.
VI. SUBLETTING OR ASSIGNING THE CONTRACT
This provision is applicable to all Federal-aid construction contracts on the National Highway
System.
1. The contractor shall perform with its own organization contract work amounting to not less
than 30 percent (or a greater percentage if specified elsewhere in the contract) of the total
original contract price, excluding any specialty items designated by the contracting agency.
Specialty items may be performed by subcontract and the amount of any such specialty items
performed may be deducted from the total original contract price before computing the amount
of work required to be performed by the contractor's own organization (23 CFR 635.116).
a. The term “perform work with its own organization” refers to workers employed or leased by
the prime contractor, and equipment owned or rented by the prime contractor, with or without
operators. Such term does not include employees or equipment of a subcontractor or lower tier
subcontractor, agents of the prime contractor, or any other assignees. The term may include
payments for the costs of hiring leased employees from an employee leasing firm meeting all
relevant Federal and State regulatory requirements. Leased employees may only be included in
this term if the prime contractor meets all of the following conditions:
(1) the prime contractor maintains control over the supervision of the day-to-day
activities of the leased employees;
(2) the prime contractor remains responsible for the quality of the work of the leased
employees;
48
(3) the prime contractor retains all power to accept or exclude individual employees from
work on the project; and
(4) the prime contractor remains ultimately responsible for the payment of predetermined
minimum wages, the submission of payrolls, statements of compliance and all other Federal
regulatory requirements.
b. "Specialty Items" shall be construed to be limited to work that requires highly specialized
knowledge, abilities, or equipment not ordinarily available in the type of contracting
organizations qualified and expected to bid or propose on the contract as a whole and in general
are to be limited to minor components of the overall contract.
2. The contract amount upon which the requirements set forth in paragraph (1) of Section VI is
computed includes the cost of material and manufactured products which are to be purchased or
produced by the contractor under the contract provisions.
3. The contractor shall furnish (a) a competent superintendent or supervisor who is employed by
the firm, has full authority to direct performance of the work in accordance with the contract
requirements, and is in charge of all construction operations (regardless of who performs the
work) and (b) such other of its own organizational resources (supervision, management, and
engineering services) as the contracting officer determines is necessary to assure the performance
of the contract.
4. No portion of the contract shall be sublet, assigned or otherwise disposed of except with the
written consent of the contracting officer, or authorized representative, and such consent when
given shall not be construed to relieve the contractor of any responsibility for the fulfillment of
the contract. Written consent will be given only after the contracting agency has assured that
each subcontract is evidenced in writing and that it contains all pertinent provisions and
requirements of the prime contract.
5. The 30% self-performance requirement of paragraph (1) is not applicable to design-build
contracts; however, contracting agencies may establish their own self-performance requirements.
VII. SAFETY: ACCIDENT PREVENTION
This provision is applicable to all Federal-aid construction contracts and to all related
subcontracts.
1. In the performance of this contract the contractor shall comply with all applicable Federal,
State, and local laws governing safety, health, and sanitation (23 CFR 635). The contractor shall
provide all safeguards, safety devices and protective equipment and take any other needed
actions as it determines, or as the contracting officer may determine, to be reasonably necessary
to protect the life and health of employees on the job and the safety of the public and to protect
property in connection with the performance of the work covered by the contract.
49
2. It is a condition of this contract, and shall be made a condition of each subcontract, which the
contractor enters into pursuant to this contract, that the contractor and any subcontractor shall not
permit any employee, in performance of the contract, to work in surroundings or under
conditions which are unsanitary, hazardous or dangerous to his/her health or safety, as
determined under construction safety and health standards (29 CFR 1926) promulgated by the
Secretary of Labor, in accordance with Section 107 of the Contract Work Hours and Safety
Standards Act (40 U.S.C. 3704).
3. Pursuant to 29 CFR 1926.3, it is a condition of this contract that the Secretary of Labor or
authorized representative thereof, shall have right of entry to any site of contract performance to
inspect or investigate the matter of compliance with the construction safety and health standards
and to carry out the duties of the Secretary under Section 107 of the Contract Work Hours and
Safety Standards Act (40 U.S.C.3704).
VIII. FALSE STATEMENTS CONCERNING HIGHWAY PROJECTS
This provision is applicable to all Federal-aid construction contracts and to all related
subcontracts.
In order to assure high quality and durable construction in conformity with approved plans and
specifications and a high degree of reliability on statements and representations made by
engineers, contractors, suppliers, and workers on Federal-aid highway projects, it is essential that
all persons concerned with the project perform their functions as carefully, thoroughly, and
honestly as possible. Willful falsification, distortion, or misrepresentation with respect to any
facts related to the project is a violation of Federal law. To prevent any misunderstanding
regarding the seriousness of these and similar acts, Form FHWA-1022 shall be posted on each
Federal-aid highway project (23 CFR 635) in one or more places where it is readily available to
all persons concerned with the project:
18 U.S.C. 1020 reads as follows:
"Whoever, being an officer, agent, or employee of the United States, or of any State or
Territory, or whoever, whether a person, association, firm, or corporation, knowingly makes any
false statement, false representation, or false report as to the character, quality, quantity, or cost
of the material used or to be used, or the quantity or quality of the work performed or to be
performed, or the cost thereof in connection with the submission of plans, maps, specifications,
contracts, or costs of construction on any highway or related project submitted for approval to
the Secretary of Transportation; or
Whoever knowingly makes any false statement, false representation, false report or false claim
with respect to the character, quality, quantity, or cost of any work performed or to be performed,
or materials furnished or to be furnished, in connection with the construction of any highway or
related project approved by the Secretary of Transportation; or
50
Whoever knowingly makes any false statement or false representation as to material fact in any
statement, certificate, or report submitted pursuant to provisions of the Federal-aid Roads Act
approved July 1, 1916, (39 Stat. 355), as amended and supplemented;
Shall be fined under this title or imprisoned not more than 5 years or both."
IX. IMPLEMENTATION OF CLEAN AIR ACT AND FEDERAL WATER POLLUTION
CONTROL ACT
This provision is applicable to all Federal-aid construction contracts and to all related
subcontracts.
By submission of this bid/proposal or the execution of this contract, or subcontract, as
appropriate, the bidder, proposer, Federal-aid construction contractor, or subcontractor, as
appropriate, will be deemed to have stipulated as follows:
1. That any person who is or will be utilized in the performance of this contract is not
prohibited from receiving an award due to a violation of Section 508 of the Clean Water Act or
Section 306 of the Clean Air Act.
2. That the contractor agrees to include or cause to be included the requirements of paragraph
(1) of this Section X in every subcontract, and further agrees to take such action as the
contracting agency may direct as a means of enforcing such requirements.
X. CERTIFICATION REGARDING DEBARMENT, SUSPENSION, INELIGIBILITY
AND VOLUNTARY EXCLUSION
This provision is applicable to all Federal-aid construction contracts, design-build contracts,
subcontracts, lower-tier subcontracts, purchase orders, lease agreements, consultant contracts or
any other covered transaction requiring FHWA approval or that is estimated to cost $25,000 or
more – as defined in 2 CFR Parts 180 and 1200.
1. Instructions for Certification – First Tier Participants:
a. By signing and submitting this proposal, the prospective first tier participant is providing the
certification set out below.
b. The inability of a person to provide the certification set out below will not necessarily result
in denial of participation in this covered transaction. The prospective first tier participant shall
submit an explanation of why it cannot provide the certification set out below. The certification
or explanation will be considered in connection with the department or agency's determination
whether to enter into this transaction. However, failure of the prospective first tier participant to
furnish a certification or an explanation shall disqualify such a person from participation in this
transaction.
51
c. The certification in this clause is a material representation of fact upon which reliance was
placed when the contracting agency determined to enter into this transaction. If it is later
determined that the prospective participant knowingly rendered an erroneous certification, in
addition to other remedies available to the Federal Government, the contracting agency may
terminate this transaction for cause of default.
d. The prospective first tier participant shall provide immediate written notice to the
contracting agency to whom this proposal is submitted if any time the prospective first tier
participant learns that its certification was erroneous when submitted or has become erroneous
by reason of changed circumstances.
e. The terms "covered transaction," "debarred," "suspended," "ineligible," "participant,"
"person," "principal," and "voluntarily excluded," as used in this clause, are defined in 2 CFR
Parts 180 and 1200. “First Tier Covered Transactions” refers to any covered transaction between
a grantee or subgrantee of Federal funds and a participant (such as the prime or general contract).
“Lower Tier Covered Transactions” refers to any covered transaction under a First Tier Covered
Transaction (such as subcontracts). “First Tier Participant” refers to the participant who has
entered into a covered transaction with a grantee or subgrantee of Federal funds (such as the
prime or general contractor). “Lower Tier Participant” refers any participant who has entered
into a covered transaction with a First Tier Participant or other Lower Tier Participants (such as
subcontractors and suppliers).
f. The prospective first tier participant agrees by submitting this proposal that, should the
proposed covered transaction be entered into, it shall not knowingly enter into any lower tier
covered transaction with a person who is debarred, suspended, declared ineligible, or voluntarily
excluded from participation in this covered transaction, unless authorized by the department or
agency entering into this transaction.
g. The prospective first tier participant further agrees by submitting this proposal that it will
include the clause titled "Certification Regarding Debarment, Suspension, Ineligibility and
Voluntary Exclusion-Lower Tier Covered Transactions," provided by the department or
contracting agency, entering into this covered transaction, without modification, in all lower tier
covered transactions and in all solicitations for lower tier covered transactions exceeding the
$25,000 threshold.
h. A participant in a covered transaction may rely upon a certification of a prospective
participant in a lower tier covered transaction that is not debarred, suspended, ineligible, or
voluntarily excluded from the covered transaction, unless it knows that the certification is
erroneous. A participant is responsible for ensuring that its principals are not suspended,
debarred, or otherwise ineligible to participate in covered transactions. To verify the eligibility
of its principals, as well as the eligibility of any lower tier prospective participants, each
participant may, but is not required to, check the Excluded Parties List System website
(https://www.epls.gov/), which is compiled by the General Services Administration.
i. Nothing contained in the foregoing shall be construed to require the establishment of a
system of records in order to render in good faith the certification required by this clause. The
52
knowledge and information of the prospective participant is not required to exceed that which is
normally possessed by a prudent person in the ordinary course of business dealings.
j. Except for transactions authorized under paragraph (f) of these instructions, if a participant
in a covered transaction knowingly enters into a lower tier covered transaction with a person who
is suspended, debarred, ineligible, or voluntarily excluded from participation in this transaction,
in addition to other remedies available to the Federal Government, the department or agency may
terminate this transaction for cause or default.
*****
2. Certification Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion –
First Tier Participants:
a. The prospective first tier participant certifies to the best of its knowledge and belief, that it
and its principals:
(1) Are not presently debarred, suspended, proposed for debarment, declared ineligible, or
voluntarily excluded from participating in covered transactions by any Federal department or
agency;
(2) Have not within a three-year period preceding this proposal been convicted of or had a
civil judgment rendered against them for commission of fraud or a criminal offense in
connection with obtaining, attempting to obtain, or performing a public (Federal, State or local)
transaction or contract under a public transaction; violation of Federal or State antitrust statutes
or commission of embezzlement, theft, forgery, bribery, falsification or destruction of records,
making false statements, or receiving stolen property;
(3) Are not presently indicted for or otherwise criminally or civilly charged by a
governmental entity (Federal, State or local) with commission of any of the offenses enumerated
in paragraph (a)(2) of this certification; and
(4) Have not within a three-year period preceding this application/proposal had one or more
public transactions (Federal, State or local) terminated for cause or default.
b. Where the prospective participant is unable to certify to any of the statements in this
certification, such prospective participant shall attach an explanation to this proposal.
2. Instructions for Certification - Lower Tier Participants:
(Applicable to all subcontracts, purchase orders and other lower tier transactions requiring prior
FHWA approval or estimated to cost $25,000 or more - 2 CFR Parts 180 and 1200)
a. By signing and submitting this proposal, the prospective lower tier is providing the
certification set out below.
53
b. The certification in this clause is a material representation of fact upon which reliance was
placed when this transaction was entered into. If it is later determined that the prospective lower
tier participant knowingly rendered an erroneous certification, in addition to other remedies
available to the Federal Government, the department, or agency with which this transaction
originated may pursue available remedies, including suspension and/or debarment.
c. The prospective lower tier participant shall provide immediate written notice to the person
to which this proposal is submitted if at any time the prospective lower tier participant learns that
its certification was erroneous by reason of changed circumstances.
d. The terms "covered transaction," "debarred," "suspended," "ineligible," "participant,"
"person," "principal," and "voluntarily excluded," as used in this clause, are defined in 2 CFR
Parts 180 and 1200. You may contact the person to which this proposal is submitted for
assistance in obtaining a copy of those regulations. “First Tier Covered Transactions” refers to
any covered transaction between a grantee or subgrantee of Federal funds and a participant (such
as the prime or general contract). “Lower Tier Covered Transactions” refers to any covered
transaction under a First Tier Covered Transaction (such as subcontracts). “First Tier
Participant” refers to the participant who has entered into a covered transaction with a grantee or
subgrantee of Federal funds (such as the prime or general contractor). “Lower Tier Participant”
refers any participant who has entered into a covered transaction with a First Tier Participant or
other Lower Tier Participants (such as subcontractors and suppliers).
e. The prospective lower tier participant agrees by submitting this proposal that, should the
proposed covered transaction be entered into, it shall not knowingly enter into any lower tier
covered transaction with a person who is debarred, suspended, declared ineligible, or voluntarily
excluded from participation in this covered transaction, unless authorized by the department or
agency with which this transaction originated.
f. The prospective lower tier participant further agrees by submitting this proposal that it will
include this clause titled "Certification Regarding Debarment, Suspension, Ineligibility and
Voluntary Exclusion-Lower Tier Covered Transaction," without modification, in all lower tier
covered transactions and in all solicitations for lower tier covered transactions exceeding the
$25,000 threshold.
g. A participant in a covered transaction may rely upon a certification of a prospective
participant in a lower tier covered transaction that is not debarred, suspended, ineligible, or
voluntarily excluded from the covered transaction, unless it knows that the certification is
erroneous. A participant is responsible for ensuring that its principals are not suspended,
debarred, or otherwise ineligible to participate in covered transactions. To verify the eligibility
of its principals, as well as the eligibility of any lower tier prospective participants, each
participant may, but is not required to, check the Excluded Parties List System website
(https://www.epls.gov/), which is compiled by the General Services Administration.
h. Nothing contained in the foregoing shall be construed to require establishment of a system
of records in order to render in good faith the certification required by this clause. The
54
knowledge and information of participant is not required to exceed that which is normally
possessed by a prudent person in the ordinary course of business dealings.
i. Except for transactions authorized under paragraph e of these instructions, if a participant in
a covered transaction knowingly enters into a lower tier covered transaction with a person who is
suspended, debarred, ineligible, or voluntarily excluded from participation in this transaction, in
addition to other remedies available to the Federal Government, the department or agency with
which this transaction originated may pursue available remedies, including suspension and/or
debarment.
*****
Certification Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion-Lower Tier Participants:
1. The prospective lower tier participant certifies, by submission of this proposal, that neither it
nor its principals is presently debarred, suspended, proposed for debarment, declared ineligible,
or voluntarily excluded from participating in covered transactions by any Federal department or
agency.
2. Where the prospective lower tier participant is unable to certify to any of the statements in
this certification, such prospective participant shall attach an explanation to this proposal.
*****
XI. CERTIFICATION REGARDING USE OF CONTRACT FUNDS FOR LOBBYING
This provision is applicable to all Federal-aid construction contracts and to all related
subcontracts which exceed $100,000 (49 CFR 20).
1. The prospective participant certifies, by signing and submitting this bid or proposal, to the
best of his or her knowledge and belief, that:
a. No Federal appropriated funds have been paid or will be paid, by or on behalf of the
undersigned, to any person for influencing or attempting to influence an officer or employee of
any Federal agency, a Member of Congress, an officer or employee of Congress, or an employee
of a Member of Congress in connection with the awarding of any Federal contract, the making of
any Federal grant, the making of any Federal loan, the entering into of any cooperative
agreement, and the extension, continuation, renewal, amendment, or modification of any Federal
contract, grant, loan, or cooperative agreement.
b. If any funds other than Federal appropriated funds have been paid or will be paid to any
person for influencing or attempting to influence an officer or employee of any Federal agency, a
Member of Congress, an officer or employee of Congress, or an employee of a Member of
Congress in connection with this Federal contract, grant, loan, or cooperative agreement, the
55
undersigned shall complete and submit Standard Form-LLL, "Disclosure Form to Report
Lobbying," in accordance with its instructions.
2. This certification is a material representation of fact upon which reliance was placed when
this transaction was made or entered into. Submission of this certification is a prerequisite for
making or entering into this transaction imposed by 31 U.S.C. 1352. Any person who fails to
file the required certification shall be subject to a civil penalty of not less than $10,000 and not
more than $100,000 for each such failure.
3. The prospective participant also agrees by submitting its bid or proposal that the participant
shall require that the language of this certification be included in all lower tier subcontracts,
which exceed $100,000 and that all such recipients shall certify and disclose accordingly.
ATTACHMENT A - EMPLOYMENT AND MATERIALS PREFERENCE FOR
APPALACHIAN DEVELOPMENT HIGHWAY SYSTEM OR APPALACHIAN LOCAL
ACCESS ROAD CONTRACTS
This provision is applicable to all Federal-aid projects funded under the Appalachian Regional
Development Act of 1965.
1. During the performance of this contract, the contractor undertaking to do work which is, or
reasonably may be, done as on-site work, shall give preference to qualified persons who
regularly reside in the labor area as designated by the DOL wherein the contract work is situated,
or the subregion, or the Appalachian counties of the State wherein the contract work is situated,
except:
a. To the extent that qualified persons regularly residing in the area are not available.
b. For the reasonable needs of the contractor to employ supervisory or specially experienced
personnel necessary to assure an efficient execution of the contract work.
c. For the obligation of the contractor to offer employment to present or former employees as
the result of a lawful collective bargaining contract, provided that the number of nonresident
persons employed under this subparagraph (1c) shall not exceed 20 percent of the total number
of employees employed by the contractor on the contract work, except as provided in
subparagraph (4) below.
2. The contractor shall place a job order with the State Employment Service indicating (a) the
classifications of the laborers, mechanics and other employees required to perform the contract
work, (b) the number of employees required in each classification, (c) the date on which the
participant estimates such employees will be required, and (d) any other pertinent information
required by the State Employment Service to complete the job order form. The job order may be
placed with the State Employment Service in writing or by telephone. If during the course of the
contract work, the information submitted by the contractor in the original job order is
substantially modified, the participant shall promptly notify the State Employment Service.
56
3. The contractor shall give full consideration to all qualified job applicants referred to him by
the State Employment Service. The contractor is not required to grant employment to any job
applicants who, in his opinion, are not qualified to perform the classification of work required.
4. If, within one week following the placing of a job order by the contractor with the State
Employment Service, the State Employment Service is unable to refer any qualified job
applicants to the contractor, or less than the number requested, the State Employment Service
will forward a certificate to the contractor indicating the unavailability of applicants. Such
certificate shall be made a part of the contractor's permanent project records. Upon receipt of
this certificate, the contractor may employ persons who do not normally reside in the labor area
to fill positions covered by the certificate, notwithstanding the provisions of subparagraph (1c)
above.
5. The provisions of 23 CFR 633.207(e) allow the contracting agency to provide a
contractual preference for the use of mineral resource materials native to the Appalachian region.
6. The contractor shall include the provisions of Sections 1 through 4 of this Attachment A in
every subcontract for work which is, or reasonably may be, done as on-site work.
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55663
Rules and Regulations
Federal Register
Vol. 75, No. 177
Tuesday, September 14, 2010
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.
OFFICE OF MANAGEMENT AND
BUDGET
2 CFR Part 170
RIN 0348–AB61
Requirements for Federal Funding
Accountability and Transparency Act
Implementation
AGENCY: Office of Federal Financial
Management, Office of Management and
Budget (OMB).
ACTION: Interim final guidance to
agencies with opportunity for comment.
SUMMARY: OMB is issuing interim final
guidance to agencies to establish
requirements for Federal financial
assistance applicants, recipients, and
subrecipients that are necessary for the
implementation of the Federal Funding
Accountability and Transparency Act of
2006, hereafter referred to as ‘‘the
Transparency Act’’ or ‘‘the Act’’. This
interim final guidance provides
standard wording for an award term that
each agency must include in grant and
cooperative agreement awards it makes
on or after October 1, 2010, to require
recipients to report information about
first-tier subawards and executive
compensation under only those awards.
This implementation of the requirement
for reporting of subawards and
executive compensation under Federal
assistance awards parallels the
implementation for subcontracts and
executive compensation under Federal
procurement contracts, which is in the
Federal Acquisition Regulation.
DATES: The effective date for this
interim final guidance is September 14,
2010. Comments on the interim final
guidance must be received by no later
than October 14, 2010.
ADDRESSES: Comments may be sent to
regulations.gov, a Federal E-Government
Web site that allows the public to find,
review, and submit comments on
documents that agencies have published
in the Federal Register and that are
open for comment. Simply type ‘‘FFATA
subaward reporting’’ (in quotes) in the
Comment or Submission search box,
click Go, and follow the instructions for
submitting comments. Comments
received by the date specified above
will be included as part of the official
record and considered in preparing the
final guidance.
Marguerite Pridgen, Office of Federal
Financial Management, Office of
Management and Budget, 725 17th
Street, NW., Washington, DC 20503;
telephone 202–395–7844; fax 202–395–
3952; e-mail mpridgen@omb.eop.gov.
FOR FURTHER INFORMATION CONTACT:
Marguerite Pridgen, Office of Federal
Financial Management, Office of
Management and Budget, telephone
(202) 395–7844 (direct) or (202) 395–
3993 (main office) and e-mail:
mpridgen@omb.eop.gov.
SUPPLEMENTARY INFORMATION:
I. Background
On June 6, 2008 [73 FR 32417], the
Office of Management and Budget
(OMB) published proposed guidance to
Federal agencies with an award term
needed to implement requirements
related to subaward reporting under the
Federal Funding Accountability and
Transparency Act of 2006 (Pub. L. 109–
282, as amended by section 6202 of
Public Law 110–252, hereafter referred
to as ‘‘the Transparency Act’’ or ‘‘the
Act’’). The guidance was proposed for
adoption in a new part 33 within title
2 of the Code of Federal Regulations
(CFR).
We are adopting the interim final
guidance in 2 CFR part 170, a different
2 CFR part than part 33 in which we
originally proposed to adopt it in June
2008. The reason is that part 33 now is
within a newly created subchapter in 2
CFR that is for OMB guidance related to
pre-award responsibilities (for more
information on the new 2 CFR
subchapters, see the notice in today’s
Federal Register that adopts 2 CFR part
25). The content of the guidance
following this preamble is better suited
to another new subchapter for guidance
on national policy requirements, a
subchapter that includes part 170.
We received comments from 75
entities in response to the 2008 Federal
Register notice, including: 29 State
agencies and two associations of State
officials; 16 institutions of higher
education and an association of research
universities; six nonprofit organizations
and an association of nonprofits; two
local governmental organizations and an
association of local government
officials; two commercial firms; one
individual; and 14 Federal agencies.
Some of the comments concerned
subaward reporting under the
Transparency Act but were not directly
related to the content of the guidance.
For example, we received comments
that suggested:
• Specific data elements that either
should be included in, or excluded
from, the information that will be
required for each subaward.
• A need for better definitions of
some data elements or clarification of
the information desired in some data
fields.
• Using the same information
technology systems for submission of
data on both: (1) Subawards under
Federal assistance awards subject to the
Transparency Act’s requirements; and
(2) subcontracts that entities receiving
Federal procurement contracts must
submit under the Act.
• Other specific features that it would
be important to include in those
information technology systems.
When we received them in 2008, we
referred comments that do not directly
relate to the policy guidance to the
appropriate Federal agency groups,
including the groups that were working
on the design of systems to which
entities will submit data to fulfill their
reporting responsibilities under the Act.
As stated in the 2008 Federal Register
notice, the data elements and other
aspects of subaward reporting are
separate from the policy guidance. The
General Services Administration has
recently published the information
collections with an opportunity for
public comment that provide the
specific data elements required for
Transparency Act reporting of
subawards and executive compensation
[75 FR 43165]. The Federal acquisition
councils have simultaneously published
for public comment their proposed
information collection for subcontract
reporting pursuant to the Transparency
Act.
As it was proposed in 2008, the new
part 33 would have required direct
recipients of Federal agency awards
and, with some exceptions,
subrecipients at all lower tiers (if their
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subawards were subject to Transparency
Act reporting requirements) to have
DUNS numbers and register in the CCR.
Since the publication of the June 2008
proposal, OMB proposed a new part 25
to 2 CFR on February 18, 2010 [75 FR
7316]. The proposed part 25 superseded
the DUNS number and CCR elements of
the June 2008 notice and limited the
DUNS number requirement to
applicants, recipients, and first-tier
subrecipients only. The preamble of the
February 2010 Federal Register
document also contained responses to
the public comments on the DUNS and
CCR requirements proposed in June
2008. Part 25 is being finalized in
another document in this section of
today’s Federal Register. Therefore, the
DUNS and CCR requirements will not
be addressed further in this document.
The remainder of this document
addresses the portions of the 2008
proposal related to reporting of
subawards, as well as the additional
reporting on executive compensation
that is required by the subsequent
amendment to the Transparency Act. In
developing the interim final policy
guidance on subaward reporting, we
considered:
• All comments relevant to that
subject in the 2008 proposal;
• The experience gained under the
guidance for, and practical
implementation of, recipient reporting
required by section 1512 of the
American Recovery and Reinvestment
Act of 2009 (Pub. L. 111–5, hereafter
referred to as ‘‘the Recovery Act’’),
which we consider to be the pilot
program for subaward reporting
envisioned by paragraph (d)(1) of
section 2 of the Transparency Act; and
• New transparency and Open
Government policies put in effect since
the publication of the 2008 proposal,
including the amendment of the
Transparency Act by section 6202 of
Public Law 110–252 to require the
reporting of the names and total
compensation of a recipient’s or
subrecipient’s five most highly
compensated executives.
Because most aspects of this guidance
were proposed in 2008, with
opportunity for comment, and given the
public benefits to be gained by
expediting the implementation of
subaward reporting under the
Transparency Act, we are publishing
this guidance as interim final.
The following section provides
detailed responses to comments that we
received on the portions of the guidance
proposed in 2008 that are relevant to
subaward reporting. Each response
describes any revisions that we
included in the interim final guidance
as a result of the comment.
II. Comments, Responses, and Changes
to the Guidance
A. Comments on the 2008 Federal
Register Preamble
Comment: Two commenters noted
that the preamble of the 2008 Federal
Register notice missed one data
element—an award title descriptive of
the purpose of the funding action—
when it listed the data elements that the
Transparency Act specifies for Federal
agencies’ awards.
Response: The commenters are correct
that the Act specifies the additional data
element. The inadvertent omission did
not affect the proposed guidance,
however. The data elements were listed
solely as background explanatory
information in the preamble of the 2008
Federal Register notice.
Comment: With respect to that same
list of data elements in the preamble,
one commenter asked whether the
inclusion of the country of the recipient
and its parent entity was a
typographical error. The commenter
suggested that the data element likely
was meant to be the county, rather than
the country.
Response: Although the specifics of
the data elements do not affect the
guidance, the data element specified in
the Transparency Act is the country,
rather than the county.
B. General Comments Related to the Act
and Guidance
Comment: Thirty nine commenters
expressed concern that recipients and
subrecipients must allocate additional
resources in order to comply with the
new requirements for subaward
reporting. They cited the need to change
business processes and systems to begin
to collect data that they are not
collecting now and do it electronically.
They also noted the continuing need for
resources to compile and report data
after that initial transition period. Most
of the commenters noted the fiscal
impact of subaward reporting and the
provision in the Transparency Act that
provides for recovering the additional
costs. Some State agencies expressed
concern that the increased
administration costs would deplete
resources available for program
purposes and some suggested that the
new requirement is an unfunded
mandate. Some institutions of higher
education noted that the limitation in
OMB Circular A–21 on recovery of
indirect costs could prevent them from
recovering those costs from their
Federal awards. Some State agencies
suggested that the costs should be
allocable as direct program costs. A
number of commenters were concerned
that the added burdens of reporting
could discourage some entities,
especially smaller subrecipient entities,
from applying for Federal grants.
Response: This guidance requires
only prime grant recipients to report to
the Federal Government on subawards
and executive compensation.
Nevertheless, we understand the
administrative changes and effort that
are associated with reporting on
subawards. As section (d)(2)(A) of the
Transparency Act provides, recipients
and subrecipients are allowed ‘‘to
allocate reasonable costs for the
collection and reporting of subaward
data as indirect costs.’’ We will assess
the overall cost impact of the new
requirements on recipients and
subrecipients, as well as their ability to
recover the indirect costs under current
limitations in statute, policy, program
regulations, or practice.
Comment: Nine commenters
suggested that it was premature to
propose the policy guidance. Among
reasons given were that we did not yet
provide details about all data elements
that will be required in each report of
an obligating action, the definitions of
the data elements, and the reporting
format and procedures that will be used.
A few commenters noted that the award
term in the proposed guidance referred
to a Web site at which entities would
submit subaward data but observed that
the site was not ready to receive data
and had no further details on what or
how to report. One commenter asked if
there was an exception process when
there are systems issues to be resolved.
Response: We revised the wording of
the award term to further clarify that the
Web site will be the source of the
detailed information on what to report
(i.e., the specific data elements and their
definitions) and how to report (i.e., the
formats and information technology
system features). That information will
be posted at the Web site before nonFederal entities are required to report
data on subaward obligations. In
addition, the General Services
Administration’s Paperwork Reduction
Act information collection also provides
the specific data elements required for
Transparency Act reporting.
There is an important distinction to
be made between the policy guidance
contained in this Federal Register
notice and the operational details on
what and how to report. Under the
current statute, non-Federal entities will
be required to report subaward data, a
basic requirement that does not depend
on the specific data elements and
Federal Register / Vol. 75, No. 177 / Tuesday, September 14, 2010 / Rules and Regulations
procedural details. The policy guidance
and the award term it contains are the
means for having agencies formally
communicate that basic statutory
requirement to recipients and
subrecipients. Neither the guidance nor
the award term needs to contain the
operational details about the specific
data elements to be reported or how to
submit the data. Both need to be in
place now so that agencies can use the
award term to provide timely
notification to recipients and
subrecipients about their
responsibilities.
Nonetheless, we fully recognize that
the operational details also are very
important. To ensure adequate
opportunity for public comment, we
have published the data elements and
other details that affect the public.
Further, we have made every effort to
minimize the burden associated with
Transparency Act reporting, through
both pre-population of data and use of
an electronic system that facilitates
streamlined reporting [75 FR 43165–
43166]. With respect to the question
concerning the exception process, the
Transparency Act does not provide for
exceptions due to unresolved systems
issues.
Comment: Twenty two commenters
recommended delaying the January 1,
2009, date on which the Transparency
Act provided that subaward reporting
would begin. They stated that the
implementation timeframe was not
reasonable, especially since the
procedures for compiling and
submitting the data would not be set
until after completion of a pilot that had
not yet begun. Seven of the commenters
also recommended that OMB grant the
18-month extension to the deadline that
the Act allowed for subrecipients under
awards to State, local, and tribal
governments, if the Director of OMB
determined that compliance would
impose an undue burden for those
subrecipients.
Response: A subaward reporting pilot
was conducted in the Fall of 2008 to
assess the burden of subaward reporting
on recipients and subrecipients. The
results of the pilot were mixed and
showed that there were various
unresolved policy and procedural issues
surrounding subaward reporting. In
2009, the Recovery Act was enacted and
required reporting of funds awarded to
prime recipients, subrecipients and
vendors. The Recovery Act reporting
effort, which commenced in October
2009, served as a demonstration of
subaward reporting on a
governmentwide scale which is why we
consider it to be the pilot program for
subaward reporting envisioned by
paragraph (d)(1) of section 2 of the
Transparency Act. Various audits and
reviews have been conducted on
Recovery Act implementation. Some of
the reports from those reviews are
available on the Recovery.gov Web site
under the ‘‘Accountability’’ section and
include information on recipient
challenges with implementing reporting
requirements under the Recovery Act.
In a memorandum dated April 6, 2010
with the subject line ‘‘Open Government
Directive—Federal Spending
Transparency,’’ OMB established an
October 1, 2010 deadline for Federal
agencies to initiate subaward reporting
pursuant to the Transparency Act and
provide a timeline for additional
guidance to assist in meeting the goals
established in the memorandum.
Comment: Three commenters pointed
out that the proposed guidance did not
include a detailed implementation of a
Transparency Act provision that
provides an exemption from the
subaward reporting requirement for an
entity that demonstrates to the Director
of OMB that its gross income, from all
sources, did not exceed $300,000 in the
previous tax year. The Act provides for
the exemption until the Director
determines that the imposition of the
reporting requirement will not place an
undue burden on such entities. The
commenters noted that the guidance did
not disclose how to request a reporting
exemption, what proofs would be
required, and what evaluation factors
OMB would use in granting exemptions.
Response: The award term in
Appendix A to part 170 of the guidance
properly includes that exception to the
subaward reporting requirement.
Section 2(e) of the Transparency Act
allows the Director, OMB, to exempt any
entity that demonstrates its gross
income, from all sources, did not exceed
$300,000 in the entity’s previous tax
year, from reporting the first-tier
subaward information, until the Director
determines that the imposition of the
reporting requirement will not cause
undue burden on the entity. The
Director has exempted entities that fall
under this category at this time.
Comment: Two commenters raised
questions concerning the applicability of
the Paperwork Reduction Act (PRA). One
stated that the Transparency Act and
guidance did not comply with the PRA.
The other suggested that OMB could not
yet provide the PRA clearance for the
information collection associated with
subaward reporting, because the data
elements and format were not specified
in the guidance proposed on
2008.
Response: As stated in the response to
a previous comment, the nature of the
55665
guidance is distinct from that of the
operational details. What requires PRA
clearance, as correctly noted by the
second commenter, are the data
elements and similar details for which
reporting burdens can be estimated. The
General Services Administration has
recently published the information
collections for public comment that
provide the specific data elements
required for Transparency Act reporting
of subawards and executive
compensation [75 FR 43165]. It is not
pertinent to the issuance of the guidance
in this Federal Register notice on the
basic statutory requirement to report.
Comment: With respect to the
requirement to report each action under
a subaward that obligates $25,000 or
more in Federal funding, ten
commenters recommended raising the
$25,000 threshold due to the potential
magnitude of the burdens, especially on
small entities. The commenters
suggested setting the threshold at
$100,000 or more, to be parallel with
their State’s reporting requirement, the
simplified acquisition threshold for
Federal procurement contracts, or the
threshold in OMB Circular A–133 at
which an entity must have a single
audit. One State agency asked if it could
request a waiver to increase that
threshold.
Response: We made no change to the
threshold in the guidance. The $25,000
threshold is set by the Transparency Act
and there is no provision in the statute
that authorizes a waiver to increase the
threshold.
Comment: Four commenters stated
that the new subaward reporting
requirement overlapped with at least
some Federal agencies’ existing
requirements for reporting on
subawards. As an example, one
commenter cited information about
subawards that applications to agencies
either contain or could be amended to
contain. Two non-Federal entities and
one Federal agency were concerned that
the existing and new requirements
could be redundant, thereby
unnecessarily increasing the burdens of
subaward reporting. One Federal agency
stated that it currently obtained
information about all subawards, and
not just those above the $25,000
threshold, and did not want to lose
insight into the subawards below
$25,000 due to the Transparency Act
threshold.
Response: Relatively few Federal
agency awarding offices currently obtain
the details about each subaward
obligation that they would need to do
the reporting under the Transparency
Act. Many agencies receive individual
applications that identify the applicant’s
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intent to make a subaward of a specified
amount if its application is successful.
However, the actual subaward recipient
may not be known at that time or, if
known, the amount that a successful
applicant obligates may not be the same
as it originally planned and proposed,
for various reasons (e.g., the Federal
award it receives may be for a lesser
amount than it proposed or it may
rebudget after receiving the award, as
pertinent Federal rules allow it to do
without the Federal agency’s prior
approval). Given that what the
application describes is only a plan, it
cannot serve as a definitive source of
information for Transparency Act
purposes. At this time, we are not
asking for reporting of subaward
information below the first-tier.
With respect to the relatively few
Federal awarding offices that do obtain
post-award data on actual subaward
obligations, we are directing those
agencies to take the necessary steps to
ensure that their recipients are not
required, due to the combination of
agency-specific and Transparency Act
reporting requirements, to submit the
same or similar data multiple times
during a given reporting period.
Comment: Five commenters asked
about the consequences of a
subrecipient’s noncompliance with
requirements related to the
Transparency Act. Two commenters
expressed concern that delivery of
essential services could be interrupted if
awards could not be made or payments
had to be suspended.
Response: After a subaward is made,
the range of consequences that may
result from the subrecipient’s material
failure to comply with a requirement
related to the Transparency Act should
be no different than it is for a material
failure to comply with other Federal
requirements. The same remedies are
available to the recipient and—should
the matter of a subrecipient entity’s
noncompliance become an issue for the
Federal Government—to a Federal
agency.
C. Comments Related to the
Applicability of the Guidance
Comment: One commenter stated that
the guidance should not apply to loan
guarantees because the definition of
‘‘federal award’’ in the Transparency Act
does not explicitly mention them. The
commenter expressed concern that the
requirement in the guidance for lenders,
small businesses, and rural businesses
to obtain DUNS numbers could be an
added barrier to their participation in
U.S. Department of Agriculture (USDA)
rural development and Small Business
Administration (SBA) programs that
stimulate financing for small and rural
businesses. The commenter
recommended not applying the
guidance to loan guarantees under those
programs until a Federal Register notice
was published, with an opportunity to
comment, that proposed applying
Transparency Act requirements to those
programs specifically.
Response: Although the 2008 Federal
Register notice proposed applicability
of the guidance broadly to all of the
types of financial assistance subject to
the Transparency Act, we revised the
interim final guidance to implement at
this time only the reporting
requirements specifically for first-tier
subawards under grants and cooperative
agreements in light of these public
comments and concerns. We are
deferring to a later date the
implementation of subaward reporting
under other financial assistance subject
to the Act, which includes loans and
loan guarantees, as well as lower-tier
subawards.
We understand the legitimate concern
that additional administrative
requirements can have an impact on
financial assistance applicants and
recipients under any Federal program.
However, to publish a notice that lists
the hundreds of programs individually
would be unnecessary and impractical.
Comment: One Federal agency
suggested we make it clearer that
financial assistance provided through
assessed and voluntary contributions is
subject to the guidance, by explicitly
listing that type of assistance in the
proposed definition of ‘‘Federal
financial assistance subject to the
Transparency Act.’’ The definition in
section 33.325 of the proposed guidance
included them only implicitly, through
the inclusion of a category of ‘‘other
financial assistance transactions that
authorize the non-Federal entities’
expenditure of Federal funds.’’
Response: We agree and made the
change to the guidance (in what now is
section 170.320).
Comment: A Federal agency
recommended that the guidance not
apply to loans, loan guarantees, interest
subsidies, and insurance that recipients
provide as subawards to subrecipients.
The agency stated that the Transparency
Act did not explicitly identify them as
subawards and their inclusion would be
inconsistent with coverage of the
administrative requirements for grants
to and agreements with educational and
other nonprofit organizations that are in
2 CFR part 215 (OMB Circular A–110).
Response: We did not revise the
guidance. The Act requires OMB to
‘‘ensure that data regarding subawards
are disclosed in the same manner as
data regarding other Federal awards.’’
The Transparency Act’s definition of
‘‘federal award’’ includes types of
financial assistance awards that are not
subject to the administrative
requirements in 2 CFR part 215, and
therefore includes them both at the
prime tier between Federal agencies and
recipients and at lower tiers between
recipients and subrecipients. While only
subawards under grants and cooperative
agreements need to be reported at this
time, subawards under all types of
Federal financial assistance subject to
the Transparency Act will need to be
reported at a later date.
Comment: One Federal agency
expressed concern that it would be
difficult to provide an actual dollar
amount associated with a transfer of
title to Federally owned property.
Response: We revised the definition
of ‘‘Federal financial assistance subject
to the Transparency Act’’ in that section
(which now is section 170.320) to
clarify that the guidance does not apply
to transfers of title to Federally owned
property.
Comment: One Federal agency
suggested amending the proposed
guidance to explicitly exclude
Cooperative Research and Development
Agreements (CRDAs) under 15 U.S.C.
3710a from coverage under the
Transparency Act. CRDAs are
instruments authorized for use between
Federal laboratories and non-Federal
entities for technology transfer
purposes. The commenter noted that the
statute permits a Federal laboratory to
receive funds from a non-Federal entity
under a CRDA and expressed concern
that a funds transfer might be perceived
as a subaward to the Federal laboratory.
Response: We agree and made a
change to the definition of ‘‘Federal
financial assistance subject to the
Transparency Act’’ in that section
(which now is section 170.320) of the
guidance. The definition of ‘‘cooperative
research and development agreement’’
in 15 U.S.C. 3710a excludes transactions
under which Federal funds are provided
to non-Federal entities. It also
distinguishes CRDAs, which are not
Federal financial assistance awards,
from cooperative agreements under the
Federal Grant and Cooperative
Agreement Act in 31 U.S.C., chapter 63.
Comment: One commenter noted that
the proposed guidance did not apply to
a Federal agency that receives an award
from another agency and asked whether
it would apply to an award that a
Federal agency receives from a nonFederal entity.
Response: Yes, the guidance applies.
The non-Federal entity would have to
report the subaward. At this time, the
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non-Federal entity would not have to
report lower-tier subawards. To clarify
this, we revised the definition of ‘‘entity’’
in the award term that now is in
Appendix A to part 170.
Comment: One commenter stated that
it acts as a fund manager overseeing
accounts for Federal agencies into
which voluntary payments, courtordered settlements, fines, and other
sources of funds are deposited. It noted
that the Federal agency specifies the
entities to whom funds from those
accounts are obligated. The commenter
asked if it is the recipient in that case
and the other entities are the
subrecipients, or if the entities to whom
it awards the funds are the prime
recipients because the Federal agency
makes the funding decisions.
Response: If the funds cited in the
comment are available for obligation or
reobligation for Federal program
purposes, this situation is somewhat
similar to that of a grant under which
the recipient is authorized to: (1) Make
loans for program purposes to
subrecipients; (2) merge the funds
received from those subrecipients’ loan
payments back into the corpus of grant
funding; and (3) use those repaid funds
to make new loans. In both that case and
the case raised by the commenter, the
non-Federal entity that manages Federal
agency funds that are available for
program purposes is the recipient. The
entities that receive the funds that the
recipient obligates or reobligates are
subrecipients.
Comment: One commenter suggested
not applying the reporting requirement
below the first-tier of subawards under
mandatory programs such as block and
formula grants and other types of
assistance to State, local, and tribal
governments.
Response: The Transparency Act does
not authorize a limitation on the
reporting requirement to the first-tier of
subawards. At this time, however, we
are deferring to a later date the
implementation of the reporting
requirement below the first-tier.
Comment: Six commenters asked
whether the requirements in the
guidance applied to prior program
announcements, awards, and
subawards. One of the commenters
pointed out that an applicant who
already had applied in response to a
previously issued announcement might
have decided not to apply if it had been
informed about the Transparency Act
requirements prior to doing so. Others
noted they would need to amend
previously issued awards if the
requirements applied to them.
Response: New Federal, non-Recovery
Act funded grant awards and
cooperative agreements with an award
date on or after October 1, 2010, and
resulting first-tier subawards, are subject
to the reporting requirements in this
guidance. New Federal grants and
cooperative agreements are grants and
cooperative agreements with a new
Federal Award Identification Number
(FAIN) as of October 1, 2010. They do
not include obligating actions on or after
October 1, 2010, that provide additional
funding under continuing grants and
cooperative agreements awarded in
prior fiscal years.
D. Other Comments
Comment: Two commenters raised
questions about the dates in the
proposed paragraph 33.200(a)(2). One
commenter asked what was meant by
the effective date of the part cited in
paragraph (a)(2)(i). The other
commenter recommended changing the
date in paragraph (a)(2)(ii). That
paragraph required a Federal agency to
incorporate Transparency Act
requirements into a program
announcement or other application
instructions if awards would be made
after October 1, 2008, in response to
applications using those instructions.
The commenter recommended changing
the date to December 31, 2008.
Response: The guidance in 2 CFR part
170 is effective today, with its
publication in the Federal Register. We
revised the date in paragraph
170.200(a)(2)(ii) to October 1, 2010.
Comment: Three commenters noted
that some entities may want to take
advantage of the flexibility that the
award term in the proposed guidance
gave a recipient to either: (1) Pass the
responsibility for reporting on lower-tier
subawards to the subrecipients who
made those subawards; or (2) do that
reporting itself, which would require
the recipient to collect the information
from lower-tier subrecipients. One, a
State agency, stated that it maintains a
complete data base that should be
sufficient to meet the Transparency Act
requirements.
Response: We recognize the burdens
associated with subaward reporting and
understand that programs and
organizations differ. However, prime
recipients will not have the option to
delegate reporting of subgrant
information to their subrecipients. We
believe that this may help reduce
reporting burden on subaward
recipients.
Comment: Six commenters asked for
clarification on the meaning of the
phrases ‘‘date of obligation’’ and
‘‘obligating action’’ used in the award
term in the proposed section 33.220
with respect to subawards. Two
55667
commenters asked how the date of
obligation would be defined for a
subaward that allowed reimbursement
of pre-award costs a subrecipient
incurred on or after a ‘‘start date’’ that
was prior to the date on which the
subaward was signed.
Response: With respect to a subaward,
an obligating action is a transaction that
makes available to the subrecipient a
known amount of funding for program
purposes. Examples include a new
subaward, an incremental funding
amendment that increases the total
amount of a subaward, or a quarterly
allotment under a formula grant
program.
We made no change to the guidance,
since ‘‘obligations’’ is a well established
term in OMB’s guidance on
administrative requirements for grants
and agreements (2 CFR part 215 and the
common rule that Federal agencies
adopted to implement OMB Circular A–
102). Under most Federal grants and
cooperative agreements, recipients
regularly report amounts of ‘‘unobligated
balances’’ to Federal agencies on the
standard financial reporting forms.
The date of obligation for a subaward
is the date on which the recipient
authorizes the subrecipient to incur
costs against the known amount it
obligates, and does so in a way that
legally obliges the recipient to provide
funds to cover costs that are incurred in
accordance with the subaward’s terms
and conditions. That date usually is
associated with the signature of a formal
document, either the initial subaward or
an amendment to it. That is distinct
from the ‘‘start date’’ cited in the
example of pre-award costs, since we
assume that the subrecipient incurs
those costs at its own risk, in
anticipation of the subaward, and that
the recipient has no legal obligation—
until it signs the subaward—to provide
award funds to cover those costs.
Comment: Eight commenters
questioned whether the guidance
required reporting of obligations or
disbursements as the award amounts.
One commenter recommended that
recipients and subrecipients report
‘‘expenditures,’’ the term used in the
Transparency Act. Four State agencies
asked how ‘‘obligations’’ would be
determined in some programs that
adjust the amount a subrecipient
receives at some time after the initial
obligation. One of the agencies cited the
example of the school lunch program,
under which the amount obligated is
not known until after the subrecipient
expends the funds.
Response: The guidance requires
reporting of each obligation, rather than
each disbursement against the amount
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obligated. If a recipient obligates a
specific known amount for a subaward,
even if it may be adjusted later, it must
report the obligation when it is made.
For a program like the school lunch
program, however, where the initial
subaward provides the subrecipient
with an open-ended authorization of
unspecified amount, the obligation date
corresponds to the date on which the
amount of the obligation is specified.
Reporting is required by the end of the
month following the month in which
the subaward obligation was made.
Comment: One commenter
recommended revising the requirement
to report each obligating action within
30 days of the date of obligation. The
commenter suggested allowing reporting
quarterly, semiannually, or annually.
Response: We changed the guidance
and award term to require obligations to
be reported no later than the end of the
month following the month of the
obligation. For example, if a subaward
is made on October 2, 2010, the
subaward information must be reported
by no later than November 30, 2010.
Comment: Ten commenters requested
additional clarification about the
difference between a subaward, which
must be reported under the
Transparency Act, and procurement
under an award, which is not subject to
the reporting requirement.
Response: It is worth noting that
recipients for many years have had to
judge whether a transaction under their
Federal award was a subaward or a
procurement action. That is because a
recipient must include different
requirements in a subaward than it does
in a procurement under an award, in
accordance with the administrative
requirements in 2 CFR part 215 (OMB
Circular A 110) or the common rule
implementing OMB Circular A 102.
Also, when the transaction provides
funds to a for-profit entity, the recipient
must properly take into account
whether the transaction would be more
characteristic of a vendor relationship
than a subrecipient under
.210 of
OMB Circular A–133. The judgments a
recipient must make to decide whether
a lower tier agreement is a subaward or
procurement for Transparency Act
reporting purposes are the same as the
judgments it makes to establish which
terms and conditions to include in the
agreement. Prime recipients should refer
to awarding agency supplemental
guidance, if any, in making such a
determination.
Two examples may help clarify the
distinction, which is based on the
purpose of the transaction between the
recipient or subrecipient and the entity
at the next lower tier. If the purpose of
the lower-tier transaction is the same as
the purpose of the substantive program
supported by the Federal award at the
prime tier, so that the recipient through
that lower tier transaction is in effect
handing a portion of the substantive
program over to the lower-tier entity for
performance, the lower-tier transaction
is a subaward. The two examples
follow:
• Example 1: Provision of health
services. A Federal program provides
funding to State agencies to deliver a
variety of services for older citizens. If
the State provides funds to a third party
to carry out a type of service (e.g.,
mental health services) that is
authorized under the program and the
State otherwise might deliver itself, the
agreement is a subaward because the
third party is carrying out substantive
programmatic activity that is the
purpose of the Federal award. If a
recipient or subrecipient obtains the
services of a third party to help in
designing public service
announcements or developing
educational materials about the
program—goods or services that the
State or subrecipient needs to carry out
the program that is the purpose of the
award—that would be a procurement
under the award or subaward.
• Example 2: Research. An agency
makes an award to a university to
investigate basic physics to understand
why certain materials have the
properties they do. To do some of the
experiments, the university researchers
need an instrument that does not yet
exist. The university provides funding
under the Federal award to a small firm
to carry out a research and development
project and develop an instrument. The
award to the firm has the purpose of
instrument development, and does not
have the same purpose as the Federal
award. The award to the firm is a
procurement action. If the university
instead made an award to the firm to
perform some of the basic research on
physics of materials that is the
substantive program purpose of the
Federal award, and the recipient
determines it does not have a vendor
relationship with the firm under this
award as described in Sec. .210 of the
attachment to OMB Circular A–133, the
award to the firm would be a subaward.
Comment: One commenter from a
State agency said that it is unclear
whether Medicaid is considered Federal
financial assistance for the purposes of
the subaward reporting requirement.
Response: There are no program
exemptions under this guidance even
though there are other types of
exemptions which are described in the
guidance. If a state makes a subaward
under a grant or cooperative agreement
to an entity other than an individual
who is a natural person, the subaward
is $25,000 or more, and no exemptions
apply, the state would need to report the
subaward.
Comment: Three commenters raised
issues with wording in the award term
in the proposed section 33.220 that
related to the $25,000 reporting
threshold for subawards. Two
commenters asked for clarification on
the meaning of ‘‘life of the subaward,’’ as
that phrase was used, both in the award
term and the associated guidance to
Federal agencies on use of the award
term. Another commenter suggested that
readers might perceive ‘‘$25,000 over
the life of the subaward’’ to be
inconsistent with ‘‘each action that
obligates $25,000 or more in Federal
funding.’’ One of the commenters also
suggested consistent wording to replace
‘‘a total value of $25,000’’ in one
paragraph and ‘‘in that range’’ in another
paragraph.
Response: With respect to the
comment concerning the apparent
inconsistency between ‘‘a total value of
25,000’’ and ‘‘each action that obligates
$25,000 or more in Federal funding,’’ it
should be noted that the two phrases
refer to related but different
requirements addressing lower-tier
subaward reporting. We have revised
the interim final guidance to show that
only recipient reporting of first-tier
subawards will be required at this time,
and therefore, the comment is no longer
relevant. We have replaced the phrase
‘‘life of the subaward’’ with alternative
wording that more clearly specifies
when a recipient must include the
Transparency Act reporting requirement
in a subaward it makes to a
subrecipient. For new Federal grants or
cooperative agreements as of October 1,
2010, if the initial award is $25,000 or
more, reporting of subaward
information is required. If the initial
award is below $25,000 but subsequent
award modifications result in a total
award of $25,000 or more, the award is
subject to the reporting requirements, as
of the date the award exceeds $25,000.
If the initial award is $25,000 or more,
but funding is subsequently deobligated such that the total award
amount falls below $25,000, the award
continues to be subject to the reporting
requirements of the Transparency Act.
Comment: One commenter asked for
clarification concerning reporting
requirements for incrementally funded
subawards. The commenter gave as an
example a subaward that a recipient
expected to exceed $25,000 over the
duration of the subaward, but for which
Federal Register / Vol. 75, No. 177 / Tuesday, September 14, 2010 / Rules and Regulations
the initial obligation was less than
$25,000.
Response: Each action that obligates
$25,000 or more in Federal funds must
be reported.
Comment: Three commenters asked
whether a recipient or subrecipient
would be required to report a downward
adjustment in the amount of a subaward
it had made previously.
Response: We made no change to the
guidance. The award term that now is
in section Appendix A to part 170 of the
guidance refers recipients and
subrecipients to the web site at which
data submission instructions will be
posted. Those instructions will include
the specific data elements and their
definitions that, as discussed in Section
I of this Federal Register notice, have
been established through a separate
process under the Paperwork Reduction
Act [75 FR 43165]. The instructions will
address whether reporting of reductions
in subaward amounts, sometimes called
‘‘deobligations,’’ are a subcategory of
obligations to be reported.
Comment: One commenter asked
about the requirement to submit
changed information other than
subaward amounts, such as a change in
subrecipient information.
Response: If the information that was
reported was correct at the time it was
reported and changed at a later date,
there would be no need to subsequently
revise the information in previously
submitted reports. The updated
information would be included in
reports of subsequent obligations under
the same subaward, however.
That is distinct from a case in which
a recipient later discovers that
information it reported was erroneous at
the time it was reported. Questions
concerning error corrections in that case
are being considered by the interagency
group developing the data elements and
information technology systems for
subaward reporting. As discussed in the
response to the previous comment, the
process for resolving those issues will
include an opportunity for public input.
Comment: Four commenters asked
how one would report subawards to
recipients with multiple Federal
funding sources. One commenter asked
if the amount of funding from each
program listed in the Catalog of Federal
Domestic Assistance (CFDA) would
need to be reported.
Response: Each action that obligates
$25,000 or more in Federal funding
would need to be separately reported.
For new Federal grants or cooperative
agreements as of October 1, 2010, if the
initial award is $25,000 or more,
reporting of subaward information is
required. If the initial award is below
$25,000 but subsequent award
modifications result in a total award of
$25,000 or more, the award is subject to
the reporting requirements, as of the
date the award exceeds $25,000. If the
initial award exceeds $25,000 but
funding is subsequently de-obligated
such that the total award amount falls
below $25,000, the award continues to
be subject to the reporting requirements
of the Transparency Act. If a single
action obligates funding from multiple
programs, the data submitted for that
action would include the CFDA number
for the program that is the predominant
source of the Federal funding. If a
program’s funding is obligated by a
separate amendment to the same
subaward agreement that provides other
programs’ funding, however, then the
data reported for each amendment to the
agreement would include the CFDA
number of the program that provided
the funding for that amendment.
Comment: One commenter asked
whether, in light of the new reporting
requirements, a subrecipient would be
subject to Federal audit requirements if
it received $500,000 or more either from
a single program or a combination of
programs.
Response: The new reporting
requirements under the Transparency
Act do not change the audit
requirements in OMB Circular A–133,
section ll.200, that apply to a nonFederal entity that expends $500,000 or
more in ‘‘federal awards’’ (which the
Circular defines to include Federal
financial assistance received indirectly
through pass-through entities).
III. Next Steps
Federal agencies that award Federal
financial assistance subject to the
Transparency Act will implement the
interim final guidance in 2 CFR part 170
through their regulations, internal
policy guidance to awarding offices,
program announcements and
application instructions, and the award
term that now is in section Appendix A
to part 170. The General Services
Administration has recently published
in the Federal Register with an
opportunity for public comment the
information collections that provide the
specific data elements required for
Transparency Act reporting of
subawards and executive compensation
[75 FR 43165]. The information
collections will be modified as
appropriate in response to public
comments and published with any other
operational guidelines before recipients
begin reporting data on subawards.
55669
List of Subjects in 2 CFR Part 170
Business and industry, Colleges and
universities, Cooperative agreements,
Farmers, Federal aid programs, Grant
programs, Grants administration,
Hospitals, Indians, Insurance,
International organizations, Loan
programs, Nonprofit organizations,
Reporting and recordkeeping
requirements, State and local
governments, Subsidies.
Danny Werfel,
Controller.
Authority and Issuance
For the reasons set forth above, the
Office of Management and Budget
amends 2 CFR chapter I by adding part
170 to read as follows:
■
PART 170—REPORTING SUBAWARD
AND EXECUTIVE COMPENSATION
INFORMATION
Sec.
Subpart A—General
170.100 Purposes of this part.
170.105 Types of awards to which this part
applies.
170.110 Types of entities to which this part
applies.
170.115 Deviations.
Subpart B—Policy
170.200 Requirements for program
announcements, regulations, and
application instructions.
170.220 Award term
Subpart C—Definitions
170.300 Agency.
170.305 Award.
170.310 Entity.
170.315 Executive
170.320 Federal financial assistance
subject to the Transparency Act.
170.325 Subaward.
170.330 Total compensation.
Appendix A to Part 170—Award Term
Authority: Pub. L. 109–282; 31 U.S.C.
6102.
Subpart A—General
§ 170.100 Purposes of this part.
This part provides guidance to
agencies to establish requirements for
recipients’ reporting of information on
subawards and executive total
compensation, as required by the
Federal Funding Accountability and
Transparency Act of 2006 (Pub. L. 109–
282), as amended by section 6202 of
Public Law 110–252, hereafter referred
to as ‘‘the Transparency Act’’.
§ 170.105 Types of awards to which this
part applies.
This part applies to an agency’s
grants, cooperative agreements, loans,
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and other forms of Federal financial
assistance subject to the Transparency
Act, as defined in § 170.320.
§ 170.110 Types of entities to which this
part applies.
(a) General. Through an agency’s
implementation of the guidance in this
part, this part applies to all entities,
other than those excepted in paragraph
(b) of this section, that—
(1) Apply for or receive agency
awards; or
(2) Receive subawards under those
awards.
(b) Exceptions. (1) None of the
requirements in this part apply to an
individual who applies for or receives
an award as a natural person (i.e.,
unrelated to any business or non-profit
organization he or she may own or
operate in his or her name).
(2) None of the requirements
regarding reporting names and total
compensation of an entity’s five most
highly compensated executives apply
unless in the entity’s preceding fiscal
year, it received—
(i) 80 percent or more of its annual
gross revenue in Federal procurement
contracts (and subcontracts) and Federal
financial assistance awards subject to
the Transparency Act, as defined at
§ 170.320 (and subawards); and
(ii) $25,000,000 or more in annual
gross revenue from Federal procurement
contracts (and subcontracts) and Federal
financial assistance awards subject to
the Transparency Act, as defined at
§ 170.320; and
(3) The public does not have access to
information about the compensation of
the senior executives through periodic
reports filed under section 13(a) or 15(d)
of the Securities Exchange Act of 1934
(15 U.S.C. 78m(a), 78o(d)) or section
6104 of the Internal Revenue Code of
1986.
§ 170.115
Deviations.
Deviations from this part require the
prior approval of the Office of
Management and Budget (OMB).
Subpart B—Policy
§ 170.200 Requirements for program
announcements, regulations, and
application instructions.
(a) Each agency that makes awards of
Federal financial assistance subject to
the Transparency Act must include the
requirements described in paragraph (b)
of this section in each program
announcement, regulation, or other
issuance containing instructions for
applicants:
(1) Under which awards may be made
that are subject to Transparency Act
reporting requirements; and
(2) That either:
(i) Is issued on or after the effective
date of this part; or
(ii) Has application or plan due dates
after October 1, 2010.
(b) The program announcement,
regulation, or other issuance must
require each entity that applies and does
not have an exception under
§ 170.110(b) to ensure they have the
necessary processes and systems in
place to comply with the reporting
requirements should they receive
funding.
(c) Federal agencies that obtain postaward data on subaward obligations
outside of this policy should take the
necessary steps to ensure that their
recipients are not required, due to the
combination of agency-specific and
Transparency Act reporting
requirements, to submit the same or
similar data multiple times during a
given reporting period.
§ 170.220
Award term.
(a) To accomplish the purposes
described in § 170.100, an agency must
include the award term in Appendix A
to this part in each award to a nonFederal entity under which the total
funding will include $25,000 or more in
Federal funding at any time during the
project or program period.
(b) An agency—
(1) Consistent with paragraph (a) of
this section, is not required to include
the award term in Appendix A to this
part if it determines that there is no
possibility that the total amount of
Federal funding under the award will
equal or exceed $25,000. However, the
agency must subsequently amend the
award to add the award term if changes
in circumstances increase the total
Federal funding under the award to
$25,000 or more during the project or
program period.
Subpart C—Definitions
§ 170.300
Agency.
Agency means a Federal agency as
defined at 5 U.S.C. 551(1) and further
clarified by 5 U.S.C. 552(f).
§ 170.305
Award.
Award, for the purposes of this part,
effective October 1, 2010, means a grant
or cooperative agreement. On future
dates to be specified by OMB in policy
memoranda available at the OMB Web
site, award also will include other types
of awards of Federal financial assistance
subject to the Transparency Act, as
defined in § 170.320.
§ 170.310 Entity.
Entity has the meaning given in 2 CFR
part 25.
§ 170.315 Executive.
Executive means officers, managing
partners, or any other employees in
management positions.
§ 170.320 Federal financial assistance
subject to the Transparency Act.
Federal financial assistance subject to
the Transparency Act means assistance
that non-Federal entities described in
§ 170.105 receive or administer in the
form of—
(a) Grants;
(b) Cooperative agreements (which
does not include cooperative research
and development agreements pursuant
to the Federal Technology Transfer Act
of 1986, as amended (15 U.S.C. 3710a));
(c) Loans;
(d) Loan guarantees;
(e) Subsidies;
(f) Insurance;
(g) Food commodities;
(h) Direct appropriations;
(i) Assessed and voluntary
contributions; and
(j) Other financial assistance
transactions that authorize the nonFederal entities’ expenditure of Federal
funds.
(b) Does not include—
(1) Technical assistance, which
provides services in lieu of money;
(2) A transfer of title to Federally
owned property provided in lieu of
money, even if the award is called a
grant;
(3) Any classified award; or
(4) Any award funded in whole or in
part with Recovery funds, as defined in
section 1512 of the American Recovery
and Reinvestment Act of 2009 (Pub. L.
111–5).
§ 170.325 Subaward.
Subaward has the meaning given in
paragraph e.3 of the award term in
Appendix A to this part.
170.330 Total compensation.
Total Compensation has the meaning
given in paragraph e.5 of the award term
in Appendix A to this part.
Appendix A to Part 170—Award Term
I. Reporting Subawards and Executive
Compensation.
a. Reporting of first-tier subawards.
1. Applicability. Unless you are exempt as
provided in paragraph d. of this award term,
you must report each action that obligates
$25,000 or more in Federal funds that does
not include Recovery funds (as defined in
section 1512(a)(2) of the American Recovery
and Reinvestment Act of 2009, Pub. L.
111–5) for a subaward to an entity (see
definitions in paragraph e. of this award
term).
2. Where and when to report.
i. You must report each obligating action
described in paragraph a.1. of this award
term to http://www.fsrs.gov.
Federal Register / Vol. 75, No. 177 / Tuesday, September 14, 2010 / Rules and Regulations
ii. For subaward information, report no
later than the end of the month following the
month in which the obligation was made.
(For example, if the obligation was made on
November 7, 2010, the obligation must be
reported by no later than December 31, 2010.)
3. What to report. You must report the
information about each obligating action that
the submission instructions posted at
http://www.fsrs.gov specify.
b. Reporting Total Compensation of
Recipient Executives.
1. Applicability and what to report. You
must report total compensation for each of
your five most highly compensated
executives for the preceding completed fiscal
year, if—
i. the total Federal funding authorized to
date under this award is $25,000 or more;
ii. in the preceding fiscal year, you
received—
(A) 80 percent or more of your annual gross
revenues from Federal procurement contracts
(and subcontracts) and Federal financial
assistance subject to the Transparency Act, as
defined at 2 CFR 170.320 (and subawards);
and
(B) $25,000,000 or more in annual gross
revenues from Federal procurement contracts
(and subcontracts) and Federal financial
assistance subject to the Transparency Act, as
defined at 2 CFR 170.320 (and subawards);
and
iii. The public does not have access to
information about the compensation of the
executives through periodic reports filed
under section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (15 U.S.C. 78m(a),
78o(d)) or section 6104 of the Internal
Revenue Code of 1986. (To determine if the
public has access to the compensation
information, see the U.S. Security and
Exchange Commission total compensation
filings at http://www.sec.gov/answers/
execomp.htm.)
2. Where and when to report. You must
report executive total compensation
described in paragraph b.1. of this award
term:
i. As part of your registration profile at
http://www.ccr.gov.
ii. By the end of the month following the
month in which this award is made, and
annually thereafter.
c. Reporting of Total Compensation of
Subrecipient Executives.
1. Applicability and what to report. Unless
you are exempt as provided in paragraph d.
of this award term, for each first-tier
subrecipient under this award, you shall
report the names and total compensation of
each of the subrecipient’s five most highly
compensated executives for the
subrecipient’s preceding completed fiscal
year, if—
i. in the subrecipient’s preceding fiscal
year, the subrecipient received—
(A) 80 percent or more of its annual gross
revenues from Federal procurement contracts
(and subcontracts) and Federal financial
assistance subject to the Transparency Act, as
defined at 2 CFR 170.320 (and subawards);
and
(B) $25,000,000 or more in annual gross
revenues from Federal procurement contracts
(and subcontracts), and Federal financial
assistance subject to the Transparency Act
(and subawards); and
ii. The public does not have access to
information about the compensation of the
executives through periodic reports filed
under section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (15 U.S.C. 78m(a),
78o(d)) or section 6104 of the Internal
Revenue Code of 1986. (To determine if the
public has access to the compensation
information, see the U.S. Security and
Exchange Commission total compensation
filings at http://www.sec.gov/answers/
execomp.htm.)
2. Where and when to report. You must
report subrecipient executive total
compensation described in paragraph c.1. of
this award term:
i. To the recipient.
ii. By the end of the month following the
month during which you make the subaward.
For example, if a subaward is obligated on
any date during the month of October of a
given year (i.e., between October 1 and 31),
you must report any required compensation
information of the subrecipient by November
30 of that year.
d. Exemptions
If, in the previous tax year, you had gross
income, from all sources, under $300,000,
you are exempt from the requirements to
report:
i. Subawards,
and
ii. The total compensation of the five most
highly compensated executives of any
subrecipient.
e. Definitions. For purposes of this award
term:
1. Entity means all of the following, as
defined in 2 CFR part 25:
i. A Governmental organization, which is
a State, local government, or Indian tribe;
ii. A foreign public entity;
iii. A domestic or foreign nonprofit
organization;
iv. A domestic or foreign for-profit
organization;
v. A Federal agency, but only as a
subrecipient under an award or subaward to
a non-Federal entity.
2. Executive means officers, managing
partners, or any other employees in
management positions.
3. Subaward:
i. This term means a legal instrument to
provide support for the performance of any
portion of the substantive project or program
for which you received this award and that
you as the recipient award to an eligible
subrecipient.
ii. The term does not include your
procurement of property and services needed
to carry out the project or program (for
further explanation, see Sec. ll .210 of the
attachment to OMB Circular A–133, ‘‘Audits
of States, Local Governments, and Non-Profit
Organizations’’).
iii. A subaward may be provided through
any legal agreement, including an agreement
that you or a subrecipient considers a
contract.
4. Subrecipient means an entity that:
i. Receives a subaward from you (the
recipient) under this award; and
ii. Is accountable to you for the use of the
Federal funds provided by the subaward.
55671
5. Total compensation means the cash and
noncash dollar value earned by the executive
during the recipient’s or subrecipient’s
preceding fiscal year and includes the
following (for more information see 17 CFR
229.402(c)(2)):
i. Salary and bonus.
ii. Awards of stock, stock options, and
stock appreciation rights. Use the dollar
amount recognized for financial statement
reporting purposes with respect to the fiscal
year in accordance with the Statement of
Financial Accounting Standards No. 123
(Revised 2004) (FAS 123R), Shared Based
Payments.
iii. Earnings for services under non-equity
incentive plans. This does not include group
life, health, hospitalization or medical
reimbursement plans that do not
discriminate in favor of executives, and are
available generally to all salaried employees.
iv. Change in pension value. This is the
change in present value of defined benefit
and actuarial pension plans.
v. Above-market earnings on deferred
compensation which is not tax-qualified.
vi. Other compensation, if the aggregate
value of all such other compensation (e.g.
severance, termination payments, value of
life insurance paid on behalf of the
employee, perquisites or property) for the
executive exceeds $10,000.
[FR Doc. 2010–22705 Filed 9–13–10; 8:45 am]
BILLING CODE 3110–01–P
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