Fishery Management Councils Administrative Training

1. Fishery Management CouncilsAdministrative Training May 14, 2009 Rimas T. Liogys Director, Grants Management Division

2. GMD - NMFS Grants Team • Arlene S. Porter – NOAA Grants Officer • Alan Conway - Team Leader • Stacy Tedder – Senior Grants Specialist • Tracy Jackson- Grants Specialist • Freddie Isaac- Grants Specialist • Rosalie Vega – Grants Specialist

3. Grants Management Responsibilities: The Grants Officer oversees the financial management and administrative aspects of grants and cooperative agreements. • Makes determinations of non-responsibility and designations of high-risk recipients. • Performs analysis of a proposed budget to assure that costs in the award budget are reasonable, allowable, and allocable in accordance with the applicable cost principles. • Ensures recipient’s compliance with award terms and conditions. Grants Manual, Chapter 4 – Responsibilities in Grants Administration

4. Authorities/Policies • Statutory: 16 U.S.C. 1852; 1881a(d) • 50 CFR 600 (Establishment of FMCs) • 15 CFR 14 (Administrative Requirements) (2CFR Part 215) • OMB Circular A-122 (Cost Principles) (2 CFR Part 230) • OMB Circular A-133 (Audit Requirements) • Statement of Organization Practices and Procedures (SOPP) for each FMC • Internal policies and procedures for each FMC • Department of Commerce Grants and Cooperative Agreements Manual

5. Overview • Consistency • Purpose • Cost Principles • Budget Process • Staff Salary Template • Fringe Benefits • Travel • Equipment • Supplies • Contractual • Other • Not Discussed (Construction, Indirect Cost & Cost Share)

6. Consistency • To establish consistency among the multi-year applications submitted by the Councils • Consistency in budgeting and the multi-year award achieves efficiencies in both the Government and Grantee community

7. Purpose of the multi-year award • To reduce the administrative burden on the Organization, Program Officer, and the Grants Management Division • With proper planning, one five-year application can suffice for the entire multi-year award period • Awards will have an “award period” of five years. Multi-year awards can be funded incrementally, either annually or multiple times during a year

8. Purpose of the multi-year award • Notice in the award that Councils may incur costs up to the obligated amount, not the total estimated amount • Primary multi-year award to each of the Councils is for the basic administrative operations of the Council

9. Multi-year Awards • Have a project period of more than 12 months of activity • Funded generally for an entire year when the award is approved, and are subsequently funded in increments for each ensuing year • Reduces the amount of Federal funds appropriated by Congress for a project

10. Multi-year Awards (Cont’d) • Awards lasting up to five years • One budget covering five years • One SF-424, SF-424a, SF-424b, and CD-511 • Five year projected budgets need to be realistic and should be based on previous five years • No annual budget submissions

11. Multi-year Awards (cont’d) • Easier for GMD to process funding for years two through five (release of funds) • Fewer close-out actions in GMD • Fewer administrative actions on behalf of the Grantee • Permits the Council and NMFS to more reliably plan for future years

12. Budget Cost Analysis • Cost Analysis is a formal means of determining the appropriateness of cost in an applicant’s budget • Always ask these questions: • Are the costs allowable under the cost principles? • Are the costs reasonable (ordinary and necessary) for the award? • Are the costs allocable to the award?

13. Cost Principles • All cost contained in the budget must comply with cost principles and all costs must be allowable, allocable, and reasonable • Be reasonable for the performance of the award and be allocable • Conform to any limitations or exclusions set forth in the principles or the award as to types or amount of cost items • Be consistent with policies and procedures that apply uniformly to both federal and other activities of the organization

14. Cost Principles (Allowability) • Be accorded consistent treatment • Be determined in accordance with generally accepted accounting principles (GAAP) • Be adequately documented

15. Cost Principles (Allocable Costs) • A cost is allocable to a particular cost objective, such as a grant, in accordance with the benefits received and if it: • (1) is incurred specifically for the award; • (2) Benefits both the award and other work and can be distributed in reasonable proportion to the benefits received; or • (3) Is necessary to the overall operation of the organization, although a direct relationship to any particular cost objective cannot be shown

16. Cost Principles (Reasonableness) • “A cost is reasonable if, in its nature or amount, it does not exceed that which would be incurred by a prudent person under the circumstances prevailing at the time the decision was made to incur the cost”. • Is the cost ordinary and necessary for the operation of the organization or performance of the award?

17. Budget Submission: Multi-year Awards • Year one is detailed for all object class categories • Year two through five can be based upon year one, with an inflation factor • Each budget year must be detailed as year one • Budget years two through five may also include anticipated costs, such as a special conference, or implementation of a special program

18. Budget Submissions: Multi-year Awards (Cont’d) • Funded incrementally, normally annually but maybe twice a year depending on funding from Congress • Grantees may only incur cost up to the amount currently obligated, not the total estimated amount of the award

19. 15 Minute Break

20. Budget • What is basis of cost? • The basis of cost is the method used by an organization, usually in accordance with their respective policies and procedures, on how a cost was developed. • A budget justification explains how a particular cost was developed

21. Budget Object Class Categories • Personnel (Salaries and Wages) • Fringe Benefits • Travel • Equipment • Supplies • Contractual • Construction • Other • Total Direct • Indirect • Total Costs

22. Personnel (Salaries and Wages) • The budget for personnel should address the following: 1. Each individual is identified by name and position? 2. Time commitments such as hours and percent of time are stated for each position. 3. The total charges for each person is listed along with an explanation of how the costs were calculated. 4. The amount of time charged for any individual cannot exceed 100% of their time. 5. The time commitments and charges need to be appropriate and reasonable.

23. Personnel (cont’d) • All individuals listed under salary must be employees of the applicant organization (If not, then they are contractual). • Is a cost of living increase built into the budget? • Provide justification for salary increases. 9. Are any salary/personnel costs unallowable? (i.e., Federal employees or legislative personnel).

24. Example of Salary Table *The sum of the total should match the salary category on the SF424A

25. Fringe Benefits • The budget for fringe benefits should address the following: • The budget narrative should provide a description of the benefits received by personnel when rates are 35% or higher. 1. Fringe benefits must be identified as a separate item. 2. Are the types of fringe benefits indicated? 3. The fringe benefits and charges must be reasonable. 4. Are the total charges for each person listed along with an explanation of how the charges were calculated? 5. Are fringe benefits to federal and matching categories in the same proportion as salaries?

26. Travel • The budget narrative must provide a detailed breakdown of travel costs. 1. For foreign, domestic and local travel, is each trip listed along with the destination, estimated mileage, method of travel, cost per mile and duration, number of travelers, per diem rate for meals and lodging? 2. If actual trip details are unknown, what is the basis for the proposed travel charges? 3. The requested travel must be directly relevant to the successful completion of the project. 4. Travel charges must be reasonable and realistic. 5. International travel you must comply with the Fly America Act. 6. Travel is only for personnel who are supported under the grant

27. Equipment • For any item(s) of equipment where the individual cost exceeds $5,000, a description of the item and associated costs is required. 1. Each item of equipment must be listed. 2. Provide a description of how it will be used in the project. 3. A lease vs. purchase analysis needs to be completed. 4. For each item of equipment, the number of units, cost per unit and total cost need to be specified. 5. Each item of equipment must be necessary for the successful completion of the project. 6. The charges for each item must be reasonable, realistic, and proportional to the use/benefit derived from the project. 7. Buy American.

28. Supplies • The budget narrative must provide a detailed breakdown of supply costs. 1. Are supplies itemized by type of material or nature of expense? 2. For general office or business supplies, is the total charge listed along with the basis for the charge (i.e. historical use rates)? 3. For other specific supply categories, is the number of units, cost per unit and total cost specified? 4. Are the charges necessary for the successful completion of the project? 5. Are the charges reasonable and realistic? 6. Buy American.

29. Contractual • The budget for contractual should address the following: 1. Each contract or sub-grant must be listed as a separate item.(Separate budgets are required for sub-grants or contracts regardless of the dollar value.) 2. Products/services to be acquired need to be described along with the applicability of each to the project. 3. Costs need to be reasonable and realistic. 4. For sole source awards provide a justification that describes why the proposed sole source entity is the only source capable of meeting the applicant's project needs? 5. If a sub award or contract is over $100,000 and is to be awarded as sole source the Grants Officer may require that written approval be obtained prior to entering into the agreement with award funds 6. Contingencies or miscellaneous charges are not allowed 7. Do you have a CD-512 on file for each of your sub-grants or contracts?

30. Construction • FMCs generally do not have construction related activities in their budgets, thus this item will not be discussed.

31. Other Direct Costs • The budget for other direct costs should address the following: 1. Are items listed by type of material or nature of expense? 2. For each charge, you should list the number of units, cost per unit and total cost. 3. Are the items necessary for the successful completion of the project? 4. Are the cost reasonable? 5. Cost such as liquor, entertainment are disallowed. 6. Contingencies or miscellaneous charges are not allowed.

32. Total Direct Cost • This number is the accumulation of all the previously mentioned direct costs. • The total cost summarized for each cost category in the budget justification need to match each cost category on the SF424A

33. Indirect Cost • Since all FMCs are 100% supported by NOAA, and all indirect type costs are directly charged (rent, electric, etc.), there are no indirect costs.

34. 10 Minute Break

35. Grant Application Package • Plan and forecast for the entire five-year award period • Submit through Grants.gov • SF 424 - Application for Federal Assistance • Block 13 will represent the five-year award period, and Block 15 will represent all funds anticipated for the five-year period. Do not use acronyms in the title (Block 11).  

36. SF-424

37. Grant Application Package (Cont.) • SF 424A - Budget Information • One form will include the estimated budget information for all five funding periods. NOTE: The current SF424A provides only four columns in Section B, Budget Categories. (The SF424A has been edited to include columns for all 5 years.) • SF 424B - Assurances • This form will be required only once for the entire five year award for basic RFMC activities

38. SF-424A

39. Grant Application Package (Cont’d) • CD 511 – Lobbying Certification • This form will be required only once for the entire five year award • If funding exceeds 5 year estimated total new forms required

40. Grant Application Package (Cont’d) • Project Narrative. • The project narrative will reflect the five-year award period and should provide a summary description of the work to be accomplished. • Consider providing an Executive Summary up front (This description may be used for public notification of funding by NOAA Grants, so make sure it accurately represents the work you are undertaking. • Do not use acronyms.) Also, summarize in general terms - the goals and objectives of the project, need for the funded activities, the Principal Investigator and other personnel scheduled to work on the project, etc.

41. Grant Application Package (Cont’d) • A. Provide a detailed description of the proposed work addressing specific tasks/activities needed to accomplish the goals and/or objectives provided in the Project Narrative  • B. Provide Milestone Charts that indicate month-by-month when each major task/activity will be undertaken and/or completed   • C. Describe any anticipated major outcomes that will result from the completion of the tasks

42. Grant Application Package (Cont’d) • The Statements of Work and Budget Details for the 2nd through 5th years should be realistic and forecast with a high degree of reliability. Each budget year must be as detailed as budget year one. Budget years two through five, may also include anticipated costs, such as a special conference, or implementation of a special program.

44. Change in Scope • A change in scope of work is any work which was not described in the original approved scope of work. • All requests for change in scope of work must be reviewed by the Program Officer and recommended for approval to the Grants Officer. The approval must be done before work is to be started. • Request must be submitted through grants online

45. Submitting and Reviewing Award Action Request • The Award Action Request index page is displayed with the available AARs. Click the link to the AAR that you wish to submit.

46. No cost Extensions • No Cost Extension – Without Invocation of Expanded Authority • Must request through Grants Online 30 days before award ends • Must provide explanation for the extension and a listing of remaining funds • Request made after the expiration date of the award will be denied (Grants Online will not allow you to submit a request)

47. Submitting and Reviewing No Cost Actions • The requested page is displayed for you to complete. Enter the required fields and click the Save button. • Attachment link displayed for uploading documents.

48. Submitting and Reviewing No Cost Action (cont’d) • After completing, click Save and Return to Main. Another message will display where you can confirm your request and start workflow, click the Yes button. Action will be sent to Authorized Rep. • Authorized rep must review and select “submit to agency” for agency review and approval.

49. Reporting • Financial reports • SF-425 Federal Financial Report (FFR) • SF-425 final full report replaces SF-269 • SF-425 semi-annual Cash Flow (lines 10.a-c) replaces SF-272 • Progress reports • Frequency determined by the Federal Program Officers • Quarterly, Semi-annually, or Annually from start date of award • All reports must be submitted through grants online

50. Odds & Ends • Unsatisfactory performance • Non Compliance with award provisions • Sub award and/or contract with a federal agency • Publication Videos and acknowledgment of Sponsorship ?