**FEDERAL MEDIATION AND CONCILIATION SERVICE**

**LABOR-MANAGEMENT COOPERATION PROGRAM**

**FINANCIAL AND ADMINISTRATIVE**

**GRANTS MANUAL**

### FISCAL YEAR 2007

**2100 K STREET, NW**

**WASHINGTON, DC 20427**

**PHONE: (202) 606-8181**

**www.fmcs.gov**

## FEDERAL MEDIATION AND CONCILIATION SERVICE

***FY2007 FINANCIAL AND ADMINISTRATIVE GRANTS MANUAL***

*TABLE OF CONTENTS*

***CHAPTER I** - INTRODUCTION*

*1. Purpose and Arrangement of the Manual I-1*

*2. FMCS Grantee Relationships I-1*

*3. Federal Grant Regulations I-1*

*4. Cautionary Provisions, Admonitions and I-5*

*Prohibitions*

*5. Deviations I-7*

*6. Freedom of Information I-7*

*7. Application Rejections and Appeals I-7*

***CHAPTER II** - GRANT APPLICATIONS*

*1. General II-1*

*2. Applications for FMCS Funds II-1*

*3. Application Preparation II-1*

*4. Application Submission II-4*

*5. Financial Capability Questionnaire II-4*

*6. Drug-Free Workplace Certification II-5*

*7. Certification Regarding Lobbying Requirement ll-5*

*8. Dun and Bradstreet (D&B) Data Universal Numbering II-5*

*System (DUNS)*

***CHAPTER III** - GRANT COSTS*

*1. Allowable Direct and Indirect Project Costs III-1*

*2. Certain General Cost Allowability Provisions III-1*

*3. Allowable and Unallowable Grant Items of Costs III-1*

***CHAPTER IV** - GRANT AND ADJUSTMENTS TO GRANTS*

*SECTION A: GRANT DOCUMENTS AND TYPES*

*1. Notice of Award IV-1*

*2. Special Conditions IV-1*

*3. Award Acceptance IV-1*

*4. Match Change IV-1*

*5. Grant Types IV-2*

*6. Grant Adjustment Notices IV-2*

*SECTION B: GRANT DURATION ADJUSTMENTS*

*1. Budget Periods IV-2*

*2. Time Extensions IV-2*

*SECTION C: BUDGET ADJUSTMENTS*

*1. Grant Budgets IV-3*

*2. Major Budget Revisions IV-3*

*3. Budget Revisions Requests IV-4*

*4. Submission of Requests IV-4*

*5. FMCS Responsibility IV-4*

*6. FMCS Official Approval IV-4*

*7. After-the-Fact Budget Revision Requests IV-4*

*8. Minor Budget Revisions IV-4*

*SECTION D: CHANGES IN PROJECT SCOPE*

*1. Changes in Project Scope IV-5*

*2. Changes-In-Scope Requests IV-5*

*3. Submission of Requests IV-6*

*4. FMCS Responsibility IV-6*

*5. FMCS Official Approval IV-6*

*6. The Budget and Changes-In-Scope IV-6*

***CHAPTER V** - GRANT PAYMENTS AND REPORTS*

*SECTION A: PAYMENTS*

*1. Payment of Funds V-1*

*2. Payment Issuance V-1*

*3. Cash Depositories V-2*

*4. Payment Cancellations V-2*

*SECTION B: REPORTS*

*1. Reporting the Unexpected V-2*

*2. Regular Grantee Reports V-2*

*3. Report Preparation V-5*

*4. Report Burden V-5*

***CHAPTER VI** - GRANT MANAGEMENT STANDARDS*

*SECTION A: ACCOUNTING STANDARDS*

*1. General VI-1*

*2. Types of Accounting Systems VI-1*

*3. Accounting for Grant Funds VI-1*

*4. Secondary Recipients VI-2*

*5. Accounting Suggestions VI-2*

*6. Interest Income VI-3*

*7. Reporting Financial Irregularities VI-3*

*8. Match Expenditures VI-3*

*SECTION B: PROCUREMENT STANDARDS*

*1. General VI-4*

*2. Grantee Responsibility VI-4*

*3. Grantee Code of Conduct VI-4*

*4. Methods of Procurement VI-4*

*5. Procurement Procedures VI-5*

*6. Prohibited Restrictions on Competition VI-6*

*7. Contracts VI-7*

*8. Awarding Agency Review VI-8*

*9. Special Federal Contractual Provisions VI-9*

*SECTION C: PROPERTY MANAGEMENT STANDARDS*

*1. General and Definitions VI-9*

*2. Property Title, Use, and Disposition VI-10*

***CHAPTER VII** -- AUDIT STANDARDS*

*1. Audit Requirements VII-12*

*2. Background VII-12*

*3. Raised Threshold for Audit VII-13*

4.  *Preparing for Audit VII-14*

5.  *Audit Responsibilities VII-14*

*6. Audit Purpose VII-15*

***CHAPTER VIII** - GRANT TERMINATION AND CLOSEOUT*

*1. Terminations and Suspensions VIII-1*

*2. Closeout VIII-3*

*3. Records Retention and Access VIII-4*

***APPENDICES***

*1. Glossary of Terms*

*2. Contract provisions Under FMCS Grants*

*3. SF-424 Completed Sample*

*4 Federal Assistance Application Form (SF-424)*

5.  *Drug-Free Workplace Certification*

6.  *Financial Capability Questionnaire*

7.  *Financial Status Report (Form LM-7)*

8.  *Request for Advance or Reimbursement (Form LM-8)*

9.  *Certification Regarding Lobbying Requirement*

***CHAPTER I.***

***[INTRODUCTION]{.underline}***

*1. **[Purpose and Arrangement of the Manual]{.underline}**. This manual
has been prepared to help FMCS applicants and recipients obtain and then
maintain an FMCS labor management committee grant. The manual is
arranged in a chronological sequence of administrative and managerial
activity, from the time you decide to apply for FMCS funds until the day
you receive notice from us that all your grant obligations have been
met. You will find in Chapter 1 through Chapter IV applicant procedures
and instructions for applying for an FMCS grant. A glossary of terms is
included as Appendix 1.*

*2. **[FMCS-Grantee Relationships]{.underline}** are partnerships, with
the grantee providing the effort and experience and FMCS the funds to
carry out approved activities under established policies and guidelines.
You are encouraged to direct to FMCS any questions you may have about
the regulations and policies contained in this manual. We also welcome
all constructive suggestions for improvement in the manual\'s content
and format.*

*3. **[Federal Grant Regulations]{.underline}**. Because the Federal
Government supports a vast number of financial assistance programs, we
are bound by regulatory consistency. In addition, as you progress
through the FMCS grant process, as well as this manual, laws which
govern FMCS Federal grants program may be identified.*

> *a. [Statutory Authority]{.underline}. For FMCS applicants and
> grantees, first among these documents is the Labor-Management
> Cooperation Act of 1978, which is a part of Public Law 95-524. The Act
> establishes our purpose and amends the Labor-Management Relations Act
> of 1947 to authorize and direct FMCS to provide financial assistance
> for the establishment and operation of labor-management committees.*

b.  *[Congressional Appropriation]{.underline}. Second is our annual
    Appropriations Act.*

    *It establishes the amount of Federal funds which are available for
    the*

    *FMCS Labor-Management Cooperation Program for the upcoming fiscal*

    *year which runs from October 1 through September 30.*

####### I-1 {#i-1 .unnumbered}

c.  *[Federal Circulars]{.underline}. Third are the Federal Circulars
    issued by the Office*

    *of Management and Budget. These circulars establish the
    administrative*

    *and cost allowability requirements governing all Federal agencies
    and*

    *departments and their clients who engage in grant activity. These
    circulars*

    *may be found at www.whitehouse.gov/omb/grants.*

    *(1) [Administrative Circulars]{.underline}. There are two: OMB
    Circular A-102 Grants and Cooperative Agreements with State and
    Local Governments (revised 8/28/97) and OMB Circular A-110 Uniform
    Administrative Requirements with Institution of Higher Education,
    Hospitals and Other Nonprofit organizations (revised 10/8/99). They
    pertain respectively to requirements for grants-in-aid to state and
    local governments and for grants and agreements with institutions of
    higher education, hospitals, and other non-profit organizations. For
    example, payment out of grant funds to an individual, whether an
    employee or not, who contributes to writing the grant application is
    prohibited.*

    *(2) [Cost Allowability Circulars]{.underline} There are three: OMB
    Circular A-21 establishes cost principles for educational
    institutions which engage in Federal grant activity; OMB Circular
    A-87 establishes the Federal grant cost principles which apply to
    state and local governments; OMB Circular A-122 establishes similar
    principles for non-profit organizations. All three circulars were
    revised 5/10/04 and applicable changes have been incorporated in
    this manual.*

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(3) *[Circular A-21 Subject: Cost Principles for Educational
    Institutions]{.underline}*

    *(a) Scholarships and student aid costs:*

    *1) Costs of scholarships, fellowships, and other programs of
    student aid are allowable only when the purpose of the sponsored
    agreement is to provide training to selected participants and the
    share is approved by the sponsoring agency. However, [tuition
    remission and other forms of compensation paid as, or in lieu of,
    wages to students performing necessary work are allowable provided
    that (1) there is a bona fide employer-employee relationship between
    the student and the institution for the work performed, (2) the
    tuition or other payments are reasonable compensation for the work
    performed and are conditioned explicitly upon the performance of
    necessary work, and (3) it is the institution's practice to
    similarly compensate students in non-sponsored as well as sponsored
    activities.]{.underline}*

    *1-2*

    *2) Charges for tuition remission and other forms of compensation
    paid to students as, or in lieu of, salaries and wages shall be
    subject to the reporting [requirements stipulated in Section J.8,
    and shall be treated as direct or F&A cost in accordance with the
    actual work being performed. Tuition remission may be charged on an
    average rate basis]{.underline}.*

    *(4) [Other OMB Circulars]{.underline} affecting FMCS applicants and
    grantees include:*

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a.  *OMB Circular A-129 Managing Federal Credit Programs*

> *(revised 11/2000), which requires that FMCS screen its*
>
> *prospective non-governmental grantees to determine the extent and
> status of financial dealings between the Federal government and the
> prospective grantee. Screening*
>
> *consists of agency comparison and verification of information
> presented in a grant application to credit reports obtained by FMCS
> through contracts negotiated by the General Service Administration of
> the United States government. Financially established, first-time
> non-governmental potential FMCS grantees are subject to the
> requirements of OMB Circular*
>
> *A-129.*

(b) *OMB Circular A-133 (revised 06/27/2003), which establishes*

> *audit requirements in accordance with Government Auditing*
>
> *Standards for State and local government, institutions of*
>
> *higher education and other non-profit institutions/organiza- tions
> receiving at least \$300,000 (\$500,000 for fiscal years ending after
> December 31, 2003) in a fiscal year from Federal funds are exempt from
> Federal audit requirements for that year.*

######  {#section .unnumbered}

*(5) [Other Federal Regulations]{.underline} which apply to the FMCS
grants*

*program and which are incorporated in this manual are the Federal*

*Register in which are published the various policies and regulations*

*for FMCS\'s particular grants program and projects; U.S. Treasury*

*circulars which establish methods for Federal payments on grant*

*obligations; and the Code of Federal Regulations: Titles 29 and 41,*

*which address the rules of conduct within which FMCS as a grantor*

*agency must work.*

*1-3*

a.  *Of particular note among these miscellaneous regulations is the
    1986 Executive Order #12549 which prohibits Federal grantees, their
    employees, contractors, sub-contractors, and other agents from using
    grant funds to purchase any direct goods or services from
    individuals or groups appearing on the Federal government\'s
    debarment and suspension roster located at (http://epls.arnet.gov).
    The prohibition applies not only to the letting of a \$50,000 EAP
    contract but also to the*

    *purchase at the grantee\'s local stationer of #2 pencils for grant
    administrative purposes. FMCS requires all grantees to check the
    U.S. General Services Administration (GSA) List of Parties Excluded
    from Federal Nonprocurement Programs located at the address above.
    Each grantee is expected to ensure that its employees, contractors,
    and subcontractors who are paid in whole in part under the grant or
    who are responsible for the obligation or expenditure of grant
    funds, neither appear on the List nor utilize grant project funds in
    grant project related business with listed individuals and
    organizations. The List is periodically revised by GSA; and grantees
    are responsible for checking the website prior to entry into any
    contacts. Grantee failure to observe the List\'s strictures may
    result in grant termination for cause (See Chapter VII of this
    Manual).*

    *(b) Also of note is the Drug-Free Workplace Act of 1988, which
    requires Federal grantees to maintain a drug-free workplace. FMCS
    will make not grant to any otherwise successful applicant until it
    has received from the applicant a signed copy of FMCS\'s drug-free
    workplace certification document. (See Appendix 5)*

    *(c) All grantees must consult and sign the Certification Regarding*

    *Lobbying Requirement located as Appendix 9 in this manual.*

    *(d) \"The Metric Conversion Act of 1975, as amended by*

    *the Omnibus Trade and Competitiveness-Act of 1988*

    *(P.L. 100-148) states a policy preference for the use*

    *of the metric system of measurement except where use*

    *is impractical likely to cause significant ineffectiveness*

    *in the accomplishments of Federally funded activities"*

    *(e) Applicants for Federal funds under any grant program*

    *administered by Federal agencies shall seek and obtain*

    *a Duns and Bradstreet (D&B) Data Universal Numbering*

    *System (DUNS) number for use as the Universal Identifier.*

    *1-4*

    *This policy directive is part of the implementation of the*

    *Federal Financial Assistance Management Improvement Act of 1999
    (Public Law 106-107). A DUNS number is required for any applicant to
    make use of the E-Grants system. Applicants submitting paper
    applications are also required to include a DUNS number as their
    Universal Identifier. The policy does not apply to individuals
    applying for direct assistance under Federal Programs.*

    *(f) Agency responsibilities. Executive Branch departments and*

    *agencies:*

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a.  *Must issue any needed direction to offices that award grants and
    cooperative agreement to implement this policy.*

> *b. Shall also direct recipients to initiate actions to obtain*
>
> *a DUNS number. The number is easily obtained by*

*telephone or via the internet*

*[htt]{.underline}p://www.dunandbradstreet.com)*

*4. **[Cautionary Provisions, Admonitions, and
Prohibitions]{.underline}**. In addition to its references to Federal
circulars and other documents, this manual also contains numerous
admonitions on grantee responsibility and numerous prohibitions. The
broad nature of all Federal grants programs is such that this must be so
to guarantee that the taxpayer from whom the grant funds come, the
grantee and its clients, and the grantor receive fair and equal
treatment and protection for their investment.*

*a. [Conflict of Interest]{.underline}. The first cautionary provision
covers conflicts of interest.*

1.  *[Advice]{.underline}. No official or employee of a state or unit of
    local*

> *government or of non-government grantees and subrecipients*
>
> *may participate personally through (a) decision, (b) approval,
> (c)disapproval, (d) recommendation, (e) the rendering of advice*
>
> *(f) investigation, or (g) otherwise, in any (a) proceeding,*
>
> *(b) application, (c) request for a ruling or other determination,*
>
> *(d) contract, (e) grant, (f) cooperative agreement, (g) claim,*
>
> \(h\) controversy, or (i) other particular matters in which grant
>
> funds are used, where to his/her knowledge he/she or (a) his/her
> immediate family, (b) his/her partners, (c) an organization other

1-5

> than a public agency in which he/she is serving as officer,
>
> director, trustee, partner, or employee, (d) or any person
>
> or organization with whom he/she is negotiating or has any arrangement
> concerning prospective employment, has a
>
> financial interest.
>
> *(2) [Appearance]{.underline}. In the use of Federal grant funds,
> officials or employees of state or local units of government and non-
> governmental grantees and subrecipients must avoid any*
>
> *action, which might result in, or create the appearance of*
>
> *using his or her official position for private gain, (b) giving*
>
> *preferential treatment to any person, (c) losing complete*
>
> *independence or impartiality, (d) making an official decision*
>
> *outside official channels, or affecting adversely the confidence*
>
> *of the public in the integrity of the Government or the program.*

*b. [Admonitions]{.underline} of responsibility, not covered elsewhere
in this manual and which applies to any FMCS grant applicant once it
accepts an FMCS award, are that:*

*(1) The grantee must administer the grant award in accordance with the
governing FMCS regulations, policies, terms, and conditions in effect at
the time of award. The grantee must also abide by any*

*subsequent laws, Executive Orders, or relevant regulatory material*

*issued during the life of the grant. The grantee may establish
additional policies not covered by, nor contradictory to, FMCS policy.*

*(2) The grantee is responsible for fiscal, administrative, and program
management as well as the fulfillment of all special conditions, which
may be prescribed for the conduct of the project.*

*(3) The grantee must comply completely with Title VI of the Civil
Rights Act of 1964 (P.L. 88-352) which provides in substance that no
person in the United States shall on the ground of race, creed, color,
national origin, sex, political affiliation or beliefs be excluded from
participation in, be denied the benefits of, or be otherwise subject to
discrimination under any program or activity for which the grantee
received Federal financial assistance.*

*1-6*

*c. [Two Prohibitions]{.underline}, not covered elsewhere in this manual
are that:*

> *(1) The grantee may not, in whole or in part, delegate or transfer
> responsibility for the management of the grant, or stewardship*
>
> *and control of grant funds, to any other organization, institution,*
>
> *or entity, except as authorized in writing by FMCS.*

*(2) The grantee may not represent himself or the grantee organization
or its affiliates or delegates as the Federal Government agency
providing the financial support for the project activity.*

> *5. **[Deviations]{.underline}**. Should you as an FMCS applicant or
> grantee determine that a*
>
> *requirement or requirements in this manual should not or cannot be
> applied*
>
> *to your particular grant project, you must submit to FMCS your
> written request*
>
> *for a deviation. The request must specify the pertinent requirements,
> your reasons why they are inappropriate to your circumstances, and any
> provisions*
>
> *or requirements you wish to substitute. No grantee may implement a
> proposed deviation until it receives from FMCS written authorization
> to do so.*

*6. **[Freedom of Information]{.underline}**. Applicants for FMCS
Labor-Management Cooperation Program grants should be aware that, under
the Freedom of Information Act (U.S.C. 552), all information contained
in an application is available to members of the general public upon
written request.*

> *7. **[Application Rejections and Appeals]{.underline}**. The
> authority to reject applications*
>
> *rests with the Director of the Labor-Management Grants Program.*
>
> *Unsuccessful applicants may appeal their rejection. Absent an abuse
> of*
>
> *discretion, the decision of the Director of the Labor-Management
> Grants*
>
> *Program is not subject to challenge.*

*a. Applicants will be formally notified of rejection by a letter from
the program director before grants are awarded. The letter will identify
the administrative or programmatic deficiencies on which the rejection
is based.*

> *b. In order to appeal, rejected applicants must contact the grants
> program*
>
> *director in writing and informally request added explanation or
> clarification*
>
> *regarding reasons for rejection. The director will provide such
> information*
>
> *as soon as practical.*
>
> *1-7*

*c. If still unsatisfied, the applicant may demand by written request to
the Director, Federal Mediation and Conciliation Service, that a
compliance investigation be conducted to determine whether all review
procedures for its application were followed in an appropriate manner.
Such written requests must be submitted to the director, FMCS, within 30
calendar days of the Program Director's response under paragraph b. The
investigation will be completed within 30 calendar days of FMCS receipt
of the request.*

> *d. If unsatisfied with the results of the compliance investigation,
> the applicant may request a formal hearing on the matter by a
> mutually-agreed-upon Hearing Examiner. A written request for such
> hearing must be submitted*
>
> *to the Director, Federal Mediation and Conciliation Service, no later
> than*
>
> *30 calendar days following applicant notification of the compliance
> investigation\'s outcome. The request must identify in detail which
> specific procedures or other actions are being challenged. The hearing
> will be conducted in Washington, DC. The costs of the hearing (space
> rental, hearing examiner, etc.) shall be borne by FMCS. Applicant
> costs such as salary compensation, travel to Washington, DC, living
> expenses while in the city, and legal counsel, shall be borne by the
> applicant.*

*1-8*

***CHAPTER II.***

***[GRANT APPLICATIONS]{.underline}***

*1. **[General]{.underline}**. FMCS **[grants must be
awarded]{.underline}** to labor-management committees comprised of
member **[representing individuals]{.underline}** covered by a
**[Collective Bargaining Agreement, including organizations or
governmental]{.underline}** units with demonstrated interest in the
furtherance of labor-management cooperation and which meet Act and
Program Announcement requirements. Applications from labor-management
committees **[must]{.underline}** be signed by the committee
chairperson(s) and **[must]{.underline}** be signed by authorized
representatives of **[both]{.underline}** labor and management.*

2.  ***[Applications for FMCS Funds]{.underline}** are entertained by
    FMCS only for those kinds of projects described in FMCS Application
    Solicitation. These Announcements*

> *are published periodically in the Federal Register and are available
> upon request. Applications for grant funds must be submitted to FMCS
> on the Federal Assistance Application for Non-Construction Programs
> form, (Standard Form 424), a copy of which is located in Appendix 4 to
> this manual. These forms, as well as an entire application kit, are
> obtainable from FMCS, by calling Grants Program Linda Stubbs on (202)
> 606-8181 or by e-mail at <lstubbs@fmcs.gov>. The Standard Form 424 is
> also available on the FMCS website
> ([http://www.fmcs.gov](http://www.fmcs.gov/)). Additionally, a copy of
> the form in Appendix 4 may be duplicated.*

*3. **[Application Preparation]{.underline}**.*

*a [General]{.underline}. Follow the applicant procedures and
instructions laid out in the SF 424 and Application Solicitation. An
example of completed application forms is contained in Appendix 3. The
individual listed as the contact person in Item 5 on the application
form will be the only person with whom FMCS will communicate during the
application review process.*

> *b. [Budget Information]{.underline}. A completed example of a Budget
> Information page*
>
> *and an accompanying budget narrative are included in Appendix 3 to
> this*
>
> *manual. In determining what anticipated project costs will comprise
> a*
>
> *reasonable budget acceptable to FMCS, refer to Chapter III, [Grant
> Costs]{.underline}.*
>
> *Also, keep in mind that the budget you are preparing, if and as
> approved,*
>
> *will be the budget document against which your financial management
> of*
>
> *the grant will be compared and for purposes of audit. Unless you are*
>
> *II-1*
>
> *specifically instructed to the contrary, assume that your application
> pertains to \"a single Federal grant program, which does not require a
> financial or activity breakdown.\" Thus, only totals need ordinarily
> be shown in Sections A and B of this part of the application. Sections
> C,*
>
> *D, and E of the SF 424 form need not be completed when applying for*
>
> *an FMCS grant.*

*c. [Special FMCS Requirements for Appl­ication Budget
Narratives]{.underline}.*

*The FMCS Application Solicitation provides for the attachment to each
grant application of a separate page or pages which detail within each
of the several Federal object class categories listed in Budget
Information Section B, the project\'s proposed individual budget line
items broken down and their estimated cost. The need for all line items,
if not self-evident, must be ascertainable within the application\'s
program narrative. A budget narrative sample is included in Appendix 3
to this manual. However, the \$ amounts listed for various line items in
the Appendix (i.e., executive director @ \$2,500/month) are only
examples. They are not intended as suggestions, allowed maximums or
proven minimums. Costs requested should be reasonable, allowable, and
acceptable in keeping with the applicant\'s local standards and those in
this manual\'s Chapter III.*

*(1) [Personnel]{.underline}. List each project position by job title.
Show annual salary rate and percentage of time to be devoted to the
project by each employee, and the total salary cost for each, if for
more than 12 months. Indicate the estimated amount of project funds to
be utilized for each employee\'s salary. \[Neither Federal nor matching
funds may be used to support personnel positions currently in
existence\].*

*(2) [Fringe Benefits]{.underline}. Indicate each type of benefit
included in your computation and also salary percentages or amounts per
employee, as applicable.*

3.  *[Trave]{.underline}l. Itemize anticipated expenses by purpose
    (i.e., staff field work, training, meetings, etc.) and by numbers of
    travelers, by transportation costs and by subsistence rates.
    Differentiate between in-state and out-of-state travel. Show
    out-of-state destinations, if they are known. If they are not known,
    provide*

    *narrative justification for out-of-state estimates. Show all
    computation bases (i.e., six people to a 3-day meeting with \$100
    plane fare and a*

    *II-2*

    \$50/day per diem or lodging and subsistence rate). Consult such

    references as the Official Airline Guide and current year city
    tourist

    guidebooks to obtain travel and lodging rate information.

    All applicants must budget for 2-trips. Budget a trip to Washington,
    D.C. for 1 1/2 days for progress review of the grant for the project
    director and/or coordinator. The second trip, please budget up to
    three people

    to attend the National Labor Management Conference and/or another
    second progress review of grant.

4.  *[Equipment]{.underline}. Indicate equipment to be purchased by
    type, number of pieces, unit price and total price (e.g., 3 office
    desk chairs at \$100: \$300). See Chapter V, Sections B and C, of
    this manual*

> *for procurement and property management regulations**. ***

-   *FMCS has the right to approve or disapprove any type*

> *of equipment and will limit the number of equipment purchased as it
> deem necessary.*

-   *Applicants may budget to purchase [not]{.underline} more than [5
    ]{.underline}*

> *of the following items: whiteboards, computers, TV*
>
> *monitors, tables, and 10 chairs, per applicant. FMCS*
>
> *has the right to approve or disapprove the number of*
>
> *items listed.*

-   *FMCS reserves the right to approve, disapprove and limit the number
    of equipment purchased with grant money (Federal or match) as it
    seems necessary.*

*(5) [Supplies]{.underline}. Include consumable office supplies;
training materials, forms; and postage. List items by type and provide
estimated unit or monthly cost. The reasonable maximum dollar amount per
person per month for consumable office supplies is \$20.*

*(6) [Contractual]{.underline}. Include all contracts for individuals or
services, which are not specifically mentioned elsewhere in this manual.
Set forth the proposed procurement method (small purchase, formal bid,
negotiation, sole source). For individual consultants show name or type,
proposed daily fee and amount of time to be devoted to the project
(e.g., **[consultants @\$950/day]{.underline}** x 5 days). For
organization contracts (professional associations, educational
institutions, etc.), describe the type of service to be performed and
the estimated contract cost. See Chapter V, Section B, of this manual
for additional procurement requirements.*

*II-3*

*(7) [Other]{.underline}. Include here any items of direct cost not
covered in the other object class categories: space (e.g., rental 400
sq. feet @ \$4 per square foot for 1.5 years) and equipment rentals,
printing and photo copying, communications other than postage, equipment
and building maintenance (if they are contracted items), security
services, audit, etc. List items by major type and by estimated unit
price (i.e., square footage, number of phones, long distance vs. local
call charges, number of copies to be printed, etc.).*

*(8) [Indirect Cost]{.underline}. FMCS does not honor requests for
indirect costs or overhead.*

*(9) [Project Income]{.underline}. Project income is money earned by a
project, either intentionally (participant/attendee registration fees
for a project-funded conference) or unintentionally (interest on project
funds deposited in a NOW account). Project income is money above and
beyond the Federal or the grantee cash share of the project cost.
Project income may not be used as match. If income generated by a
proposed project-funded activity is to be used as a source of project
financial support during the life of the grant, indicate the anticipated
amount on line 7.*

*(10) [About Grantee Contributions (Matc­h)]{.underline}. Consult the
Application Solicitation for current requirements regarding minimum
grantee contributions. Assume that the cost of every line item in the
budget is to be shared by FMCS and the grantee at a ratio, which is the
same as that of the project\'s overall required cash sharing ratio.
Indicate in the budget narrative the source (budget allocation, public
appropriation, private contribution, dues, etc.,) of the grantee share
of the project costs. **FMCS does not allow in-kind contributions as
part of grantee match in the budget**. Remember that match is calculated
on total project cost, NOT on Federal dollars requested.*

*d. [Assurances (Application pages 7 an­d 8)]{.underline}. An application
submission to FMCS is not complete unless these assurances are included
in it, and no award will be made without their inclusion.*

*e. [Program Narrative]{.underline}. To comply with FMCS program
requirements, see the accompanying Application Solicitation.*

*ll-4*

*4. [A**pplication Submission**]{.underline}. The original signed and
labeled (Original) application and three copies must be submitted to
FMCS, Office of Labor-Management Grants Program**. [FMCS will accept
applications for FY2007 after MAY 1, 2007 until]{.underline}** **[July
31, 2008, or until all FY 2007 grant funds have been
obligated]{.underline}**, which ever comes first. All awards will be
made by September 30, 2008.*

5.  ***[Financial Capability Questionnaire]{.underline}**. As a part of
    post-application, pre-award negotiations, an applicant for FMCS
    initial funding may be requested to complete*

    *a financial capability questionnaire, which is a survey of the
    applicant\'s current*

    *accounting system and financial status. If so requested, the
    applicant must fill*

    *out the form, have it certified by an independent accountant, and
    submit it to*

    *FMCS. (See Appendix 6)*

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5.  ***[Drug-Free Workplace Certification]{.underline}**. See Chapter I,
    Page 3, Paragraph (4)(b).*

6.  **[Lobbying]{.underline}**. See Appendix 9. This is also part of the
    post-application,

    pre-award process and does not have to be completed as part of the

    application

7.  **[Dun and Bradstreet]{.underline}** (D&B) Data Universal Numbering
    System (DUNS) number for

use as the Universal Identifier. See Chapter 1, Page 4, Paragraph (4)
(e).

ll-5

***CHAPTER III**.*

***[GRANT COSTS]{.underline}***

*1. **[Allowable Direct Project Costs]{.underline}** are those specified
in the Application*

*Solicitation, this manual, OMB Circulars A-21, A-87, and A-122, in
other*

*appropriate circulars that may be issued, or as specified in cost
principle*

*policies current at the time of grant award and reflected in a
grantees*

*Notice of Award. The cost of a grant project is comprised of its
allowable*

*direct costs less program income or other applicable credits.*

*2. **[Certain General Cost Allowability Provisions]{.underline}** apply
to grants and must always be kept in mind. They comprise the framework
within which specific*

*cost allowability provisions lie. They are:*

*a. The cost of a particular item must be reasonable;*

> *b. Each cost item must contribute to the purpose and execution of
> the*
>
> *grant project;*

*c. Each cost item must be allowable under the grantee\'s own laws,
regulations and policies;*

I.  *Each cost item must be treated consistently by the grantee within
    both*

> *its grant and its non-grant activities; and*
>
> *e. The grantee\'s own cost allowability provisions are to be utilized
> by*
>
> *the grantee in determining allowable grant costs, except where*
>
> *such provisions do not exist or where Federal provisions are more*
>
> *strict. In such case, Federal provisions apply.*

*3. **[Allowable and Unallowable Grant Items of Cost]{.underline}***

> *This section identifies a selected list of allowable and unallowable
> cost*
>
> *items. The omission from the list of a particular cost item does not
> imply*
>
> *the allowability or unallowability of that item. The items on the
> list are*
>
> *only those most ordinarily considered for possible expenditures of*
>
> *funds in the conduct of a grant supported project.*
>
> *III-1*
>
> *a. Costs requiring FMCS prior approval are designated in this manual.
> However an item of cost so designated is specified as a cost item in
> the budget narrative of an application, FMCS approval of the budget
> and subsequent award of Federal funds constitute approval of that
> cost.*

*b. Prior approval of cost items, which do not appear in the application
budget, must be requested in writing. Grantees may not consider a
request approved until receipt of written authorization from FMCS.*

*c. When purchasing or planning to purchase goods or services with grant
funds, grantees must keep in mind the provisions of Executive Order
#12549. See Chapter I of this manual, paragraph 3.c.(4).*

*d. Questions regarding cost items not covered by the following list, or
by*

*this manual generally should be directed to FMCS.*

*e. [Selected List of Allowable and Una­llowable Costs]{.underline}.*

> *(1) [Accounting]{.underline}. Allowable.*
>
> *(2) [Advertising]{.underline}. Allowable for personnel recruitment
> and the*
>
> procurement of goods and services for the execution and performance of
> a grant project and for other purposes
>
> specifically provided for in the approved budget. Applies to
> newspapers, magazines, radio, television, direct mailing, etc.

*(3) [Auditing]{.underline}. Allowable, **if required** and performed in
accordance*

*with the Single Audit Act, as implemented by Circular A-133, Section
230 (b)(2).*

*(4) [Bad Debts]{.underline}. **Unallowable**. Includes actual and
estimated losses arising from uncollectible accounts and other claims,
and related collection and legal costs.*

*(5) [Bonding]{.underline}. Allowable when required by the grantee for
employees handling grant funds.*

*(6) [Bonuses]{.underline}. **Unallowable,** but see [Incentive
Compensation]{.underline}, under [Personnel]{.underline} in this list of
costs.*

*III-2*

*(7) [Conferences]{.underline}. Allowable for certain costs associated
with meetings and conferences, including cost of renting facilities and
speakers\' fees. **Grant funds cannot be used for food other than
non-alcoholic beverages** served at mid-morning and mid-afternoon
breaks. Also see [Entertainment]{.underline} and
[Honoraria]{.underline}, in this list of costs.*

*(8) [Consultant Services]{.underline}. Allowable. See Chapter V,
Section B, for details.*

*(9) [Contingency Funds]{.underline}**. Unallowable**. Applies to any
provision made for events the occurrence of which cannot be foretold
with certainty as to time, intensity, or with an assurance of their
happening. But also see [Insurance]{.underline}; and under
[Personnel]{.underline}, see [pensions]{.underline} and [severance
pay]{.underline}.*

*(10) [Depreciation]{.underline}. Allowable pursuant to terms of grant
award.*

*(11) [Donations and Contributions]{.underline} (by the grantee to
others). Unallowable.*

*(12) [Donations and Contributions]{.underline} (to the grantee by
others).*

> *Allowable for purposes of match that may be required in*
>
> *the FMCS Application Solicitation or offered voluntarily by*
>
> *the applicant or grantee. The donation must be cash. All*
>
> *donations and contributions must be necessary and reason-*

*able for accomplishment of project objectives and must be*

*supported by grantee written records.*

*(13) [Dues]{.underline}. Allowable for a grantee\'s organizational or
institutional*

> *membership in a professional organization. Membership fees*

for individuals are unallowable.

*(14) [Entertainment]{.underline}. **Unallowable**. Applies to
amusements, social*

> *activities, business luncheons, office coffee breaks, etc.*
>
> *However, cost of coffee and other non-alcoholic beverages*

*are allowable pursuant to terms of award when incurred as a*

*conference or meeting cost when part of the approved budget.*

*III-3*

*(15) [Equipment]{.underline}. Allowable with FMCS prior approval and
under*

***Please see Chapter II, paragraph C (4) for further details.***

*(16) [Fines and Penalties]{.underline}. **Unallowable**.*

*(17) [Food]{.underline}. **Unallowable** in FMCS grant projects**.***

*(18) [Fund Raising]{.underline}. **Unallowable**.*

*(19) [Honoraria]{.underline}. **Unallowable**. Applies to payments and
rewards the intent of which is to confer distinction upon or to
symbolize respect, esteem or admiration for the recipient. Excludes
compensation for documented services rendered.*

*(20) [Indirect Costs]{.underline}. **Unallowable** in FMCS grant
projects.*

*(21) [Insurance and Indemnification]{.underline}. Allowable pursuant to
terms of award.*

*(22) [Interest on Loans]{.underline}. **Unallowable**.*

*(23) [Labor Relations]{.underline}. **Unallowable**.*

*(24) [Lobbying]{.underline}. **Unallowable**. Applies to publicity or
propaganda designed to support or defeat legislation pending before
legislative bodies; also to any direct or indirect personal service,
advertise-ment, telegram, telephone, letter, printed or written matter,
or other device intended or designed to influence in any manner a member
of Congress to favor or oppose by vote or otherwise any legislation or
appropriation by Congress, whether before or after the introduction of
any bill or resolution proposing such legislation or appropriation; also
to payment for a publicity expert. Excludes activities such as testimony
before legislative bodies reviewing statutory reform or the
effectiveness of grant programs.*

*(25) [Losses on Other Grant Awards]{.underline}. **Unallowabl**e.*

*(26) [Meetings]{.underline}. Allowable. But also see
[Conferences]{.underline}, [Entertainment]{.underline}, and
[Food]{.underline} in this list of costs.*

*III-4*

*(27) [Personnel]{.underline}**. Unallowable for salary and wages of
Federal employees,** for reimbursement of an organization or an
individual for personnel services by an individual in excess of that
individual\'s official salary; for an increase in an individual\'s
salary beyond the amount regularly set under the grantee\'s established
policies; for payment of any portion of that share of a salary in excess
of current Federal maximums; for existing staff; for personnel services
that would otherwise be unallowable elsewhere in this list of costs or
under other paragraphs and subparagraphs in this manual.*

*(a) [Cost of Living and Merit Increases]{.underline}. Allowable to the
extent that such payments are made under formally established and
consistently applied grantee organization policies, and are uniformly
charged as a cost on an actual rather than an estimated basis.*

*(b) [Incentive Compensation; Pensions­ Severance Pay]{.underline}.
Allowable pursuant to organization/employee prior established agreements
or to established and consistent organization plans.*

*(c) [Overtime]{.underline}. Allowable pursuant to terms of award and to
organization/employee prior established and consistent organization
plans.*

> *(d) Under an FMCS grant personnel costs must be*
>
> *reasonable and not exceed \$50,000 -- \$60,000 per year**.***

*(28) [Pre-Award Costs]{.underline}. Allowable only with FMCS prior
written approval. Applies only to costs incurred which are necessary to
comply with a non-negotiable project performance delivery schedule and
only to the extent that such costs would have been allowable had they
been incurred after the beginning date of the grant budget period.*

*(29) [Publications]{.underline}. Allowable for both purchase and
development. However, all publication development including that for
videos, websites, brochures, newsletters, and program announcements,
which is financed in whole or in part with project funds must
acknowledge FMCS involvement by including in the publication the
sentence: \"This document/website was financed in whole or in part by a
\$ \_\_\_ grant from the Federal Mediation and Conciliation Service.\"*

*III-5*

30. *[Public Information]{.underline}. Allowable. But also see
    [Lobbying]{.underline} in this list of*

> *costs.*

*(31) [Rearrangement, Alteration, Renova­tion]{.underline}. Allowable
with FMCS prior approval.*

*(32) [Rentals]{.underline}. **Unallowable** for privately owned and
publicly owned equipment, space or buildings, the purchase or
construction of which having been financed by the Federal Government.*

*(33) [Recruitment Costs]{.underline}. Allowable pursuant to terms of
award.*

*(34) [Taxes]{.underline}. **Unallowable** for taxes from which
exemptions are available to the grantee directly; for taxes on which
exemptions have been afforded the Government and where exemption
certificates are available; for special assessments representing capital
improve-ments on land; for Federal income tax; for excise taxes on
accumulated deficiencies and other penalties imposed under the Employee
Retirement Income Security Act.*

*(35) [Training]{.underline}. Allowable for project-related activities
in setting up or maintaining a labor-management committee.
**Unallowable** for general job-training or re-training of plant or
community workforces.*

*(36) [Travel]{.underline}. Allowable. Applies to costs directly
attributable to specific work under a grant; to costs charged on an
actual or on a per diem and mileage basis, or a reasonable combination
of the two. First class air accommodations and travel outside of Canada
and the United States and its territories and possessions are allowable
only if and [after]{.underline} FMCS approval is obtained.*

*III-6*

***CHAPTER IV.***

***[GRANT AND ADJUSTMENTS TO GRANTS]{.underline}***

*This chapter identifies the several documents, which make up the
official record of an FMCS grant, discusses their relevance, and
describes the circumstances under which they are used. Grants to support
projects under the Labor Management Cooperation Act of 1978 are made on
a budget period basis, which is subject to an annual appropriation of
funds by Congress.*

***[SECTION A.]{.underline}***

***[GRANT DOCUMENTS AND TYPES]{.underline}***

*1. [**Notice of Award (LM-1**)]{.underline}. Grants in response to
approved applications for FMCS funds are awarded on an FMCS Notice of
Award (LM-1). This Notice obligates and reserves Federal funds for the
grantee\'s use for a specific period of time in order to execute the
project covered by the Notice. The Notice also commits the grantee to
its share of the project\'s financial support. All correspondence
concerning the grant should refer to the award number shown on the
Notice.*

*2. **[Special Conditions]{.underline}**. Where necessary, the Notice of
Award (LM-1) includes a list of special conditions which the grantee
must meet in order to receive the grant.*

*3. **[Award Acceptance]{.underline}**. No obligations or commitments of
FMCS funds to a project are valid and no FMCS funds may be disbursed to
or expended by the grantee until authorized representatives of both FMCS
and the grantee have signed the Notice of Award and any applicable
special conditions, and until FMCS has in its possession copies of the
Notice and its special conditions which bear the grantee
representative\'s original signature of acceptance. FMCS as
justification for grant termination without further notice may consider
award acceptances not received by FMCS within 45 days of the date of
award appearing on the Notice of Award.*

*4. **[Match Change]{.underline}** Once the Award Notice (LM-1)has been
signed by both FMCS and the grantee representative grantee must submit a
written request prior to the end of the first 3 months of the grant a
request to lower the approve match money. If FMCS approves to lower the
approved match the Federal amount will be lowered as well. After the 3
months grantee is obligated to the required percentage of match as shown
on the signed award notice*

####### 

####### 

####### 

####### IV-1

*5. **[Grant Types]{.underline}**. There are two:*

> a\. *[Initial Grant]{.underline}. This grant obligates FMCS funds,
> which have been awarded, to a project for an initial budget period
> shown on the Notice of Award (LM-1). The grant is based upon an
> approved application from the grantee. The award of an initial grant
> does not constitute a commitment for future FMCS funding.*

b\. [Supplemental Grant.]{.underline} When allowed by FMCS policy, this
grant obligates

FMCS funds for a budget period subsequent to the one currently in

progress. When awarded, the additional amount is added to the current

grant amount. The award is based on an approved application from the

grantee. On a Notice of Award a supplemental grant is identified by the

letter **[S]{.underline}** following the grant number. FMCS awarded
funds which are

unexpended by a grantee at the end of the current budget period shall,

subject to FMCS approval, be used to defray partially the amount of

Federal support required during the supplemental period.

*6. **[Grant Adjustment Notices]{.underline} (LM-2) or (GAN)** are
issued by FMCS as its*

*acknowledgment of grantee compliance with special conditions or in
favorable*

*answer to grantee written requests for grant project changes concerning
one or*

*more of the following circumstances: budget period extensions; budget*

*revisions; changes in project scope. Grant Adjustment Notices (LM-2),
when*

*issued, become a part of the official record of a grant. [No GANs
approving time]{.underline}*

*[extensions or changes in budgets or project scope will be issued if
the grantee]{.underline}*

*[is delinquent in responding to any official FMCS reporting
requirements]{.underline}.*

***[SECTION B]{.underline}.***

***[GRANT DURATION ADJUSTMENTS]{.underline}***

*1. **[Budget Periods]{.underline}**. Grantee obligations and
expenditures of both the Federal*

*and the approved grantee shares of project costs may be made only
within*

*the confines of the current budget period as shown on the Notice of
Award.*

*2. **[Time Extensions]{.underline}**. Additional time to complete a
project phase or a total project with grant funds may sometimes be
necessary. In such cases, FMCS will consider grantee requests for time
extensions, and will issue a Grant Adjustment Notice if and when it
approves the request.*

*IV-2*

*a. Grantee requests to FMCS for time extensions must be submitted at
least 30 days but no more than 60 days before the currently scheduled
budget period ends.*

*b. Grantee requests for time extensions must identify the
circumstances, which necessitate the extension, and if necessary, a
concurrent request for a budget revision or a change in project scope,
if either condition is applicable. The maximum extension period is six
months.*

***[SECTION C.]{.underline}***

***[BUDGET ADJUSTMENTS]{.underline}***

*1. **[Grant Budgets]{.underline}**. A grant budget as approved within
the context of a Notice of Award is the official financial plan for the
grantee\'s utilization of both the Federal and the grantee share of
project costs. Grant expenditures within the various Federal object
class categories, (Personnel, Fringe benefits, Travel, etc.) must
generally conform to the amounts set forth for those categories in the
approved budget and may not be made for any purpose contrary to the
approved application and to the regulations and policies of the Federal
Government in general, FMCS and the grantee in particular.*

*2. **[Major Budget Revisions]{.underline}**. Should a grantee find,
during the course of administering a grant-supported project, that the
currently approved budget can no longer represent a true picture of
anticipated necessary expenditures to support the project effectively,
an FMCS approved budget revision may be in order. All grantees must
obtain prior approval from FMCS for budget revisions when:*

*a. The revision results from changes in the scope of objectives of the
project; or*

*b. Funds approved for trainee costs are transferred to other expense
categories; or*

*c. The Federal share of the grantee budget is over \$100,000 and the
cumulative amount of transfers among object class categories is expected
to exceed 10% of the total grant budget; or*

*IV-3*

*d. The revision includes the addition to the budget of a cost item or
items requiring FMCS prior approval in accordance with the provisions of
OMB Circulars A-21, A-87, or A-122, or this manual.*

*3. **[Budget Revision Requests]{.underline}** as required by #2 above,
directed to FMCS, must be in writing and describe the pending revision.*

*a. The request must justify the revision in narrative form;*

*b. The request must identify clearly the Federal object class
categories between which funds are to be transferred;*

*c. The request must indicate the dollar amounts of change between each
currently approved category total and each pending category total; and*

*d. The request must list currently approved cost items proposed for
deletion and each pending addition to each object class category, and
provide unit prices.*

*4. **[Submission of Requests]{.underline}**. Budget revision requests
should be submitted to FMCS at least 30 days before the request is to be
effected.*

*5. **[FMCS Responsibility]{.underline}**. FMCS will contact grantees
within 14 days of its receipt of a budget revision request, either to
notify the grantee informally of its decision, to request additional
information, or with official revision approval.*

*6. **[FMCS Official Approval]{.underline}** of a budget revision
request will be contained in a Grant Adjustment Notice.*

*7. **[After-The-Fact Budget Revision Requests]{.underline}** will not
be approved.*

*8. **[Minor Budget Revisions]{.underline}**. Budget changes other than
those described above do not require FMCS approval. These changes
include the use of grantee funds over and above any grant budget\'s
approved grantee minimum share to further project or program
objectives.*

*IV-4*

***[SECTION D.]{.underline}***

***[CHANGES IN PROJECT SCOPE]{.underline}***

*1. **[Changes in Project Scope]{.underline}**. Events may occur during
the course of a project, which have a significant impact upon the
project\'s execution. In such cases the grantee must inform FMCS as soon
as certain types of conditions manifest themselves. These conditions are
generally viewed to be events or develop-ments, which affect the
project\'s ability to attain its objectives or to meet its established
time schedules and goals. They may be either favorable or detrimental.
Examples are:*

*a. any revision of the scope or objectives of the project regardless of
whether there is an associated budget revision requiring project
approval;*

*b. a change in a key person specified in the application or grant award
document;*

*c. the project director is replaced, or absent for more than three
months;*

*d. additional contracting out or otherwise obtaining the services of a
third party to perform activities, which are central to the purposes of
the grant;*

> *e. in the event the grantee undergoes a change in ownership or name,*
>
> *FMCS must be notified in writing immediately.*
>
> *f. grantees should inform FMCS of minor changes in the scope of a
> project within the framework of the grantee\'s regular reporting
> responsibilities*
>
> *and procedures. Minor changes might include the addition of one more
> member to the labor-management committee.*

*2. **[Change-In-Scope Requests]{.underline}**. A grantee must inform
FMCS of any deliberate intent to effect a major change in the project
scope, submitting a change-in-scope request. The contents of this
request should normally include the following:*

*a. A description of the proposed change and the date when such change
is to go into effect;*

*b. A justification of the proposed change; and*

*IV-5*

*c. A discussion of the positive program and fiscal implications in
approving the change as well as potential negative effects if such a
change is not approved.*

*3. **[Submission of Requests]{.underline}**. Change-in-scope requests
should be submitted to FMCS at least 30 days before the intended
change.*

*4. **[FMCS Responsibility]{.underline}** for handling change-in-scope
requests is the same as that identified for budget revision requests in
paragraph C.6., above.*

*5. **[FMCS Official Approval]{.underline}** of a change-in-scope
request will be contained in a Grant Adjustment Notice.*

6.  ***[The Budget and Changes-in-Scope]{.underline}**. If any change in
    project scope necessitates a project budget revision in accordance
    with the criteria provided*

*in paragraph C.2., above, the grantee must submit to FMCS a budget
revision request.*

*IV-6*

***CHAPTER V.***

***[GRANT PAYMENTS AND REPORTS]{.underline}***

***[SECTION A.]{.underline}***

***[PAYMENTS]{.underline}***

1.  ***[Payment of Funds]{.underline}**. FMCS funds are obligated to a
    grant project by FMCS when the Notice of Award is signed. They are
    thus reserved for the project\'s purposes until they are expended by
    the grantee or until, in the case of non- expenditure within the
    time limits set in the Notice of Award or subsequent Grant
    Adjustment Notices, they are deobligated by FMCS by means of Grant
    Adjustment Notices and thus revert to the Government.*

    *2. **[Payment Issuance]{.underline}**. In accordance with the Debt
    Collection Improvement Act of 1996 all FMCS grantees receive funds
    via [Electronic Funds Transfer (EFT]{.underline}) on a reimbursement
    or monthly advance basis. The EFT requests are provided to the
    grantees at the time of award. The U.S. Treasury issues the EFT
    after FMCS has approved the requests.*

    *FMCS grantees receiving a Federal payment shall designate a
    financial institution or authorized payment agent through which a
    Federal payment may be made. **Grantees under certain circumstances,
    [may]{.underline} qualify for a waiver of the EFT requirement. Under
    the Act, payment must be made by EFT unless one of four
    circumstances applies: hardship; impossibility; excessive costs; or
    endangerment of law enforcement or national security interests.
    Grantees must** **certify in writing for a waiver outlining the
    circumstances that apply.***

    *Any payment that we make to you will be made by electronic funds
    transfer unless you certify in writing that you do not have an
    account*

    *with a financial institution or an authorized payment agent.*

    *I certify that I do not have an account with a financial
    institution or an authorized payment agent.*

    *\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_*

    *Signature Date*

    *V-1*

    *3. **[Cash Depositories]{.underline}**. FMCS grantees and secondary
    recipients must deposit*

    *their grant project funds in a bank with FDIC coverage. Any
    balances exceeding the FDIC coverage must be collaterally secure.
    FMCS regulations do not require the physical segregation of project
    funds or the establishment of any eligibility requirement for cash
    depositories. However, consistent with the national goal of
    expanding the opportunities for minority business enterprises, all
    grantees and subrecipients are encouraged to utilize the services of
    banks which are at least half owned by members of minority groups.*

    *4. **[Payment Cancellations]{.underline}**. Unless otherwise
    required by law, FMCS withholds payment on grantee fund requests
    only when the grantee is demonstrating an unwillingness or inability
    to attain project goals or an inability to maintain an acceptable
    accounting system; cannot adhere to FMCS requirements, including an
    acceptable accounting system; and timely submission to FMCS of
    accurate financial and narrative reports and special condition
    requirements; or engages in improper grants administration,
    including failure to minimize the time elapsing between its receipt
    of funds from the U.S. Treasury and the actual expenditure of those
    funds; or is indebted to the United States and collection of the
    indebted-ness will impair accomplishment of FMCS grant project
    objectives. Where such a condition or conditions exist, FMCS will
    inform the grantee that payments will not be made for
    grantee-incurred obligations after a specific date and until the
    condition or conditions are corrected, at which time payments will
    be resumed on either an advance or reimbursement basis as FMCS deems
    more appropriate.*

    ***[SECTION B.]{.underline}***

    ***[REPORTS]{.underline}***

    *1. **[Reporting the Unexpected]{.underline}**. See Chapter IV,
    Section D.*

2.  ***[Regular Grantee Reports]{.underline}**. There are three reports
    required, two financial in*

*nature and one performance-oriented. **As required by the Federal
Financial ***

***Assistance Management Improvement Act of 1999, Public Law 106-107,***

***FMCS provides the forms on-line in a fillable format to allow for
application***

***by electronic funds.***

######## V-2

> *In preparing the financial reports, grantees should keep certain
> definitions*
>
> *in mind. Obligations are amounts owed on orders placed, contracts
> let, services received and similar transactions during a given period
> that will eventually require payment. Outlays are treated and reported
> differently depending on whether a*
>
> *cash or accrual accounting system is used. In either case, however,
> outlays are*
>
> *the same as expenditures, the sum of actual cash the grantee has
> disbursed or*
>
> *paid out. Project income is money earned by the project and is used
> to offset approved grant project costs. It is not grant cash payments
> received from FMCS*

by way of the U.S. Treasury, nor is it cash contributions accepted as a
matching share by FMCS at the time of grant award. The three regular
reports are:

> *a. Financial Status Report (Form LM-7). A quarterly LM-7 must be*
>
> *submitted to FMCS no later than 30 days after the end of each
> calendar quarter during which the grant project was supported by
> approved project funds, whether or not actual obligations or
> expenditures of funds by the grantee took place. The end of each
> calendar quarter is December 31, March 31, June 30 and September 30.
> **Grantees are given a grace ***
>
> ***period of 30 days after the calendar quarter to submit reports.**
> Therefore, LM-7s are due at FMCS no later than January 31, April 30,*
>
> *July 31, and October 31. A final LM-7 for the project must be
> submitted no later than 90 days after the last day of the project\'s
> final budget period. Extensions to reporting due dates may be granted
> by FMCS upon request of the grantee. A sample of a Financial Status
> Report (Form LM-7) is included in Appendix 7 of this Manual.*

*b. [Request for Advance or Reimburseme­nt (Form LM-6)]{.underline}.
While the LM-6*

*is technically a request for funds, it is also a report of expenditures
and FMCS uses it as such. Grantees who are not paid under
letters-of-credit must submit an LM-6 to FMCS when they want funds. No
fund requests should be submitted for a period of time covering less
than a month, except in unusual circumstances. Grantees on
letter-of-credit are not required to submit LM-6s.*

*(1) [Requests solely for fund advances]{.underline} must be submitted
only on a monthly basis, and FMCS will ordinarily honor those requests
only after the 15th of the preceding month; i.e., only after November 15
will FMCS honor an advance request covering anticipated expenses for the
month of December.*

V-3

*(2) [Fund requests solely for reimbursement]{.underline} may be
submitted at the grantee\'s convenience, except that the final
reimbursement request for a grant must be received by FMCS within 90
days after the grant\'s last approved budget period expiration date.*

*(3) [Combination request]{.underline} on a single LM-6 for both an
advance and a reimbursement of funds will be honored by FMCS as a
request for an advance. See (1) above.*

*(4) [All fund requests will be placed on hold]{.underline} if other
reporting requirements are delinquent. Chronic delinquencies may result
in grant suspension and/or termination.*

c.  *[Milestones (FMCS F­orm LM-8)]{.underline}. All FMCS grantees must
    monitor their*

> *grant projects to ensure that project performance goals are being*
>
> *achieved in a timely manner, and must submit to FMCS a quarterly*
>
> *narrative report summarizing their findings for each grant project.
> The*
>
> *milestone reports are due December 31, March 31, June 30 and*
>
> *September 30. **Grantees are given a grace period of 30-day period
> after the calendar quarter.** Therefore, LM-8s are due at FMCS no
> later than January 31, April 30, July 31, and October 31. A final
> performance report must be submitted within 90 days after the grant\'s
> last approved budget period expiration date. Extensions to reporting
> due dates may be granted by FMCS upon request by the grantee.
> Quarterly performance reports should include:*
>
> *(1) A comparison of actual accomplishments to the goals and
> implementation plan established for the reported quarter;*

*(2) If goals have not been met, the reasons for same; and,*

3.  *Other pertinent information including, when appropriate, an*

> *analysis and explanation of cost overruns or high unit costs,
> potential program problem areas, or significant achievements.*
>
> *(4) Copies of all LMC meeting minutes along with a list of "members
> present and members absent".*

####### 

V-4

####### 

3.  ***[Report Preparation]{.underline}**. **Grantees will receive
    training on the electronic preparation and submission of the LM-6,
    LM-7 and LM-8 forms at the ***

    ***FMCS grantee orientation session**.*

4.  ***[Report Burden]{.underline}**. FMCS must include on each form it
    requires its grantees*

*to complete the estimated time (burden) necessary for completion.
These*

*estimates are based on FMCS\'s assumption that grantees are familiar*

*with their own grant projects and maintain as a matter of course
manage-*

*ment and accounting records adequate to complete the forms in the time*

*estimated. However, grantees may appeal FMCS estimates to FMCS.*

*V-5*

***CHAPTER VI.***

***[GRANT MANAGEMENT STANDARDS]{.underline}***

***[SECTION A.]{.underline}***

***[ACCOUNTING STANDARDS]{.underline}***

1.  ***[General]{.underline}.** **Each grantee must maintain an adequate
    system of ***

***accounting and** **internal control for itself**. Each grantee must*

*also ensure that adequate systems are also maintained by its secondary*

*recipients and contractors. All grantee and subrecipients accounting
systems*

*must maintain a separation of FMCS grant project funds from other
funds.*

*2. **[Types of Accounting Systems]{.underline}**. An accounting system
is generally one of two types:*

*a. [Cash Basis]{.underline}. Project revenues are recorded as cash is
received, and project expenses are recorded as cash is spent.*

b.  *[Accrued Basis]{.underline}. Revenue due the project and expenses
    incurred by the project for a given period are recorded without
    regard to the timing of*

> *the actual exchange of cash and whether or not any current service or
> performance is required.*

*3. **[Accounting for Grant Funds]{.underline}** is to be done in
accordance with the grantee\'s own accounting practices so far as they
do not conflict with or omit the standards listed in this section.
Accounting must be based on generally accepted account-ing principles,
and must be consistently applied regardless of the source of funds.
Itemization of all supporting records of grant expenditures shall be
recorded in sufficient detail to show the exact nature and cost of the
expenditures for each account. Records must be maintained in such a
manner as to permit preparation of required financial reports and to
indicate that project funds were used for the purposes for which the
grant was made. A grantee\'s accounting system must provide for:*

*a. [Compliance with statutory and regu­latory requirements]{.underline}
for the award of Federal funds and their subsequent distribution,
financial management and disposition, and accounting;*

*VI-1*

*b. [Accurate, current, and complete­ disclosure]{.underline} of the
financial results of each grant activity in accordance with FMCS
reporting requirements as set forth in this manual;*

*c. [Records]{.underline} which accurately and adequately identifies the
receipt and expenditure of funds for grant-supported activities. These
records*

*shall contain information pertaining to grant awards and
authorizations, obligations, unobligated balances, assets, liabilities,
outlays, and income;*

*d. [Comparison of actual with budgeted ­amounts]{.underline} for the
grant and relation of financial information to performance or
productivity data;*

*e. [Procedures]{.underline} to minimize the time elapsing between the
transfer of funds from the U.S. Treasury and their disbursement by the
grantee, whenever funds are advanced by the Federal Government. Advances
made by the grantee to secondary recipients shall conform to the same
standards of timing and amount as apply to advances by FMCS to
grantees;*

*f. [Procedures]{.underline} for determining reasonableness,
allowability, and appropriate-ness of costs in accordance with this
manual;*

*g. [Accounting records]{.underline}, which are supported by source
documentation;*

*h. [Generation of financial data]{.underline} which can be used in the
planning, management and control of current and future projects; and*

*i. [Facilitation]{.underline} of effective audits.*

*4. **[Secondary Recipients]{.underline}**. FMCS grantees shall require
secondary recipients to adopt the standards in paragraph 3, above.*

*5. **[Accounting Suggestions]{.underline}**. The following suggestions
are offered for the preparation of acceptable accounting records:*

*a. Maintain a separate income account for Federal funds received or
amounts owed to FMCS;*

*b. Maintain time-and-attendance records to support salary and wages
charged to the grant;*

*c. Maintain a separate accounting ledger for the Federal share of each
FMCS grant;*

*VI-2*

*d. If applicable, maintains a separate accounting ledger for the
contributed non-federal share of each FMCS grant and for project
income;*

*e. Sub-divide the accounting ledger or ledgers for each grant into the
object class categories shown on the budget page of the approved
application budget;*

*f. Support expenditures charged to cost accounts with vouchers approved
both by the grant financial manager and by the grant project director;*

*g. Credit refunds of expenditures to the applicable object class
categories;*

*h. As applicable, audit reported cash transactions once every fiscal
year; and*

*i. Retain both the audit reports and supporting work papers for review
by representatives of cognizant Federal agencies and the General
Accounting Office.*

6.  ***[Interest Income]{.underline}**. Interest earned on advances of
    Federal funds except for interest earned on advances to a State or
    to instrumentalities of a State as provided by the
    Inter-governmental Cooperation Act of 1968, (P.L. 90-577),*

*shall be remitted to FMCS.*

7.  ***[Reporting Financial Irregularitie­s]{.underline}**. Every grantee
    and each of its secondary recipients must report promptly to FMCS
    the nature and circumstances surrounding any financial
    irregularities discovered during the course of a*

*project or in its aftermath.*

*8. **[Match Expenditures]{.underline}**. Initially, the grantee share
of project cash need not be expended at exactly the same rate and time
as the Federal share. However, the approved ratio must be met or
exceeded at the calendar half-way point of the grant budget period, and
consistently thereafter.*

> *Six months after the grant has been awarded, grantee must show at
> least 50% of Federal and Match expenditures on their financial papers,
> including their quarterly Financial Status Report (LM-7).  If
> grantee fails to do so, FMCS has*
>
> *the right to terminate the grant, deobligate the federal funds and
> close out the grant without further notice to grantee.  A grant
> adjustment notice and close out letter will be issued.  *

*VI-3*

***[SECTION B.]{.underline}***

***[PROCUREMENT STANDARDS]{.underline}***

*1. **[General]{.underline}**. All grantees must follow Federal
standards for the procurement with grant project funds of supplies,
equipment, construction and all other services. All procurement
transactions whether negotiated or advertised, and without regard to
dollar value, must be conducted in a manner which provides the greatest
open and free competition. All grantees must be alert to organizational
conflicts of interest or noncompetitive practices among contractors,
which may restrict or eliminate competition or otherwise restrain trade.
Contractors that develop or draft specifications, requirements,
statements of work, or requests for proposal for a proposed procurement
are excluded from bidding or submitting a proposal to compete for the
award of such procurement.*

*2. **[Grantee Responsibility]{.underline}**. A grantee shall use its
own procurement procedures, which reflect applicable state and local
laws and regulations and its own policies. Additionally, procurement
under Federal grant projects must also conform to Federal standards.*

*3. **[Grantee Code of Conduct]{.underline}**. A grantee must maintain a
code or standards of conduct, which govern the performance of its
authorized representatives engaged in the award and administration of
contractors supported by Federal funds. No grantee employee, officer, or
agent may participate in the selection or award or administration of a
contract supported by Federal funds if a conflict of interest, real or
apparent, could be involved.*

*4. **[Methods of Procurement]{.underline}**. There are four:*

*a. [Small Purchase]{.underline}. Applies to procurements for goods,
services, supplies, etc., costing in the aggregate not more than
\$100,000 and which are based on sound and appropriate procedures and in
which price or rate quotations are obtained from at least three
qualified sources.*

*b. [Sealed Bids]{.underline}. Applies to procurements which lend
themselves primarily to firm-fixed-price contracts; in which grantee
selection of the successful bidder can be made principally on the basis
of price; for which a complete, adequate and realistic specification or
purchase description is available; and for which two or more responsible
contractors are willing and able to compete.*

*VI-4*

*c. [Competitive Negotiations]{.underline}. Applies to procurements in
which conditions fail to lend themselves to formal advertising; in which
proposals are requested from an adequate number of qualified sources to
permit reasonable competition and in which negotiations are conducted
with more than one of the sources; and for which requests for proposal
identify all significant evaluation factors including price or cost
where required and their relative importance.*

*d. [Non-Competitive Negotiations]{.underline}. Applies to procurements
in which the*

> *item is available from only one source; or, in which, after a number
> of*
>
> *solicitations, competition is determined inadequate; also, for which
> other procurement methods are infeasible and for which written
> documentation is available to support the procurement\'s
> non-competitive nature; and before which FMCS written approval has
> been obtained. Such procurements are known as sole source.*
>
> *e. [Qualification]{.underline}. Grantees are directed to award
> contracts that possess*
>
> *the ability to perform successfully the terms and conditions
> contained*
>
> *in proposed contracts.*

*5. **[Procurement Procedures]{.underline}**. The grantee must maintain
procurement procedures which provide that proposed procurement actions:*

*a. Be competitive;*

*b. Avoid the purchase of unnecessary or duplicative items and
services;*

*c. Obtain purchases on the most economical basis;*

*d. Be prefaced by solicitations which are based on clear and accurate
descriptions of technical requirements for the material, product or
service to be procured; but which refrain from unduly restrictive
requirements; and which clearly set forth all requirements which
offerors must fulfill and all other factors to be used in bid or
proposal evaluation;*

*e. Include and encourage qualified small, minority and women\'s
businesses as possible sources of supplies, services, etc.;*

*f. Be climaxed only by award to a responsible contractor that possesses
the potential ability to perform successfully under the procurement\'s
terms and conditions; and*

*VI-5*

*g. Be supported by records and files which are retained and are
sufficient to detail the procurement\'s significant history.*

h.  *In addition, the grantee shall have procedures to handle and
    resolve protests relating to their procurements and review of
    protests against their subrecipients and shall, in all instances,
    disclose information regarding any protest to FMCS. Protestors
    themselves must exhaust*

> *all administrative remedies with the grantee or its subrecipient
> before requesting a review of the grantee\'s action by FMCS. Reviews
> of protests by FMCS are limited to:*

*1) violation of Federal Law or regulations and the standards of this
section;*

*2) violations of the grantee\'s protest procedures;*

*3) failure by the grantee to review a complaint or protest against a
subrecipient.*

*6. **[Prohibited Restrictions on Competition]{.underline}**. Some
situations are considered to be restrictive of competition and must be
avoided by the grantee. Examples are:*

*a. placing unreasonable requirements on firms in order for them to
qualify to do business;*

*b. requiring unnecessary experience;*

*c. non-competitive pricing practices between firms or affiliated
companies;*

*d. non-competitive awards to consultants on retainer contracts;*

*e. organizational conflicts of interest;*

*f. specifying brand names only;*

*g. any arbitrary action in procurement process.*

*VI-6*

*7. **[Contracts]{.underline}**. There are several types of contracts:
fixed price, cost reimbursable, purchase orders, etc. Contracts
resulting from the formal advertising procure-ment method must be
firm-fixed-price. Cost-plus-a-percentage-of-cost contracts are
prohibited.*

*a. [General Grantee Contractual Requi­rement]{.underline}. The
arrangement must be formal, proper and consistent with the usual
contracting practices and policies of the grantee or secondary
recipient.*

*b. [Requirements for Grantee Contract­s with an
Organization]{.underline}.*

*(1) Indirect costs or overhead charges in cost-type arrangements must
be based on an audited or negotiated rate previously approved by a state
or Federal agency or on an indirect cost submission reflecting actual
cost experience during the organization\'s most recently completed
fiscal period;*

*(2) Arrangements with non-profit organizations and government units
must be directly and exclusively devoted to grant project purposes and
charged at rates which are not more than actual cost;*

*(3) Fixed fee or profit allowances, where applicable in cost-type
arrangements, must not exceed 10% of total estimated cost.*

*c. [Requirements for Grantee Contract­s with an
Individual]{.underline}.*

*(1) Time and services for which payment is or will be made must be
supported by adequate documentation;*

*(2) Dual compensation, compensation from the individual\'s regular
employer and from the grantee for work performed during a single period
of time, is prohibited;*

*(3) Transportation and subsistence costs for travel performed by the
individual must be at a rate consistent with the grantee\'s general
travel reimbursement practices; or, with Federal practices, whichever is
applicable.*

*(4) Compensation for an individual consultant must be reasonable and
consistent with that paid for the individual\'s particular services or
for similar services nationally or locally, whichever is less.*

*VI-7*

*(a) For consultants associated with educational institutions the
maximum rate of compensation is the individual\'s academic salary
projected for 12 months and divided by 260 working days;*

*(b) For consultants employed by state and local governments the maximum
rate of compensation, if the government unit does not provide the
individual\'s services without cost, is the individual\'s daily salary
rate paid by the government unit;*

*(c) For consultants employed with non-government organiza-tions the
maximum rate of compensation is the individual\'s daily salary paid by
the organization;*

d.  *In any case the maximum rate for an individual consultant paid from
    grant project funds can be no more than \$950 for*

*an **[eight-hour day.]{.underline}** The day includes preparation,*

*evaluation, and travel time. The rate excludes travel and*

*subsistence costs. **Time and effort records must be ***

***maintained.***

8.  ***[Awarding Agency Review]{.underline}**. Before completing a
    procurement action the grantee must make available to FMCS for
    review, procurement documents*

*such as requests for proposal, invitations for bid, independent cost
estimates, etc., when:*

a.  *the grantee\'s procurement procedures or operation fails to comply*

> *with the standards in paragraph 5; preceding, or*

*b. a proposed contract modification changes the contract\'s scope or
increases the contract amount by more than the small purchase threshold;
or*

*c. the procurement is expected to exceed the small purchase threshold,
and*

*1) is to be awarded without competition, or only one bid or offer is
received in response to the solicitation; or*

*2) specifies a brand name product; or*

*3) is to be awarded to other than the apparent low bidder when sealed
bid procurement is used.*

*VI-8*

*9. **[Special Federal Contractual Provi­sions]{.underline}**. A grantee
must include in each contract, in addition to provisions to define a
sound and complete agreement, several other provisions depending on the
contractual amount and intent. These special provisions apply to all
contracts over \$10,000; to construction and repair contracts over
\$2000; to contracts in the field of science and technology in which
there has been little significant experience outside of work funded by
Federal assistance; and to any contract or agreement, the principle
purpose of which is to create, develop or improve products, processes or
methods, or for exploration into fields that directly concern public
health, safety or welfare. Appendix 2 to this manual contains these
special provisions. These provisions must also be applied to
subcontracts.*

***[SECTION C.]{.underline}***

***[PROPERTY MANAGEMENT STANDARDS]{.underline}***

*1. **[General and Definitions]{.underline}**. Grantees and secondary
recipients may use their*

*own property management standards and procedures as long as the Federal
provisions in paragraph 2, following, are met. Some useful definitions
are:*

> *a. [Real Property]{.underline}. Land, including land improvements,
> structures and*
>
> *their appurtenances. Excludes moveable machinery and equipment.*

*b. [Equipment]{.underline}. Tangible personal property having a useful
life or more*

*than a year and an acquisition cost of \$5,000 or more per unit. The
acquisition cost of an item is the net invoice unit price of the
property including the cost of modifications, attachments, accessories,
etc., necessary to make the property useable for the purchase for which
it*

*is acquired. Other charges, installation, taxes, etc., shall be
included*

*or excluded from the acquisition cost in accordance with the grantee\'s
regular practice.*

*c. [Supplies]{.underline}. Tangible personal property other than that
which is classified as equipment.*

*d. [Consumables]{.underline}. Items such as paper, pencils, etc.*

*2. **[Property Title, Use, and Dispositio­n]{.underline}***

*a. [Real Property]{.underline}. Not applicable to FMCS grant projects.*

*b. [Equipment and Supplies]{.underline}. Title rests in the grantee
except when the property is otherwise identified by FMCS in the grant
agreement or elsewhere, in writing.*

*VI-9*

*(1) [Use]{.underline}. The property is to be used in the project for
which it was acquired for as long as needed, whether or not FMCS funding
continues. Shared use by other Federally sponsored projects is
permissible as long as the project for which the item was originally
acquired is not adversely affected. In either case, certain procedural
requirements must be met.*

*(a) Accurate property records must be maintained to include a
description of the property; manufacturer\'s serial number, model
number, or other identification number; source of the property,
including the Federal agreement number; identity of entity in which
property title is vested; acquisition date; percentage of FMCS
participation in cost of grant project for which the property was
acquired; location, use and condition of the property and the date the
information was reported; unit acquisition cost; and, ultimate
disposition data including date, sales price, and, if applicable, the
method of determin-ing the property\'s fair market value.*

*(b) At least once every two years a physical inventory of property must
be taken; the results reconciled with property records; the existence,
current utilization, and continued need for the property verified.
Differences between the inventory and the records must be investigated
to determine the cause.*

*(c) A control system to insure adequate safeguards against property
loss, damage or theft must be maintained. All such losses must be
reported to appropriate authority and must be investigated and fully
documented.*

*(d) Adequate maintenance procedures to keep the property in good
condition must be maintained.*

*(e) Where a grantee is authorized or required to sell the property,
proper sales procedures must provide for competition to the extent
practicable and for the highest possible return.*

*VI-10*

2.  *[Disposition]{.underline}. Property with a unit acquisition cost of
    more than \$5,000 may be retained by the grantee for non-project
    uses provided that compensation is made to FMCS. Compensation is*

> *to be computed by applying the percentage of FMCS participation*
>
> *in the cost of the original grant project to the current fair market*
>
> *value of the property. If the grantee has no further need for the*
>
> *property and the property has further use value, instructions for
> its*
>
> *disposition must be requested from FMCS. If no instructions for
> disposition are received within 120 days of the grantee\'s request,
> the grantee shall sell the property and reimburse FMCS or its
> successor in an amount computed by applying to the sale proceeds the
> percentage of FMCS participation in the original grant project, less
> \$500 or 10% of the proceeds whichever is greater for the grantee\'s
> selling and handling expenses. Property with a unit cost less than
> \$5,000 may be retained or sold and the proceeds kept*
>
> *by the grantee without further Federal involvement.*

c.  *[Patents, Copyrights, etc]{.underline}. Patentable items, patent
    rights, processes,*

> *or inventions produced within a grant project must be promptly and
> fully reported to FMCS. Copyrights of materials developed in the
> course of*
>
> *or under an FMCS grant project are the author\'s privilege; but FMCS
> reserves a royalty free, non-exclusive and irrevocable right to
> reproduce, publish, or otherwise use, and to authorize others to use
> the work for government purposes.*

*VI-11*

***CHAPTER VII.***

***[AUDIT STANDARDS]{.underline}***

*1. **[Audit Requirements]{.underline}**. Grantees that expend \$500,000
or more annually in federal financial assistance must have a single
audit or program-specific audit (if certain criteria are met) performed
in accordance with the Single Audit Act Amendments of 1996, and Office
of Management and Budget (OMB) Circular*

> *A-133, Audits of States, Local Governments, and Non-Profit
> Organizations. The circular, is effective for audits of fiscal years
> beginning after June 30, 1996. OMB defines federal financial
> assistance within the scope of the circular as assistance received or
> administered in the form of grants, cooperative agreements, loans,
> loan guarantees, property (including donated surplus property),
> interest subsidies, insurance food commodities, direct appropriations
> and other assistance.*
>
> *For those grantees exempt from single audit requirements, financial
> and compliance records still must be made available for review or
> audit by other federal officials or pass-through entities. FMCS may
> also request that a limited program--specific audit be conducted using
> grant funds.*

2.  ***[Background]{.underline}**. The Single Audit Act of 1984 required
    audits of states and*

> *local governments (including Indian tribal governments) that
> administer*
>
> *federal financial assistance programs. A single audit encompasses a*
>
> *grantee's financial statements and schedule of expenditures of
> federal*
>
> *awards for the entire organization or the respective departmental
> units*
>
> *administering federal funds, as opposed to a program-specific audit,*
>
> *which focuses on one particular program (thus, the concept of
> "single"*
>
> *audit). OMB implemented the act by issuing Circular A-128, Audits of*
>
> *State and Local Governments. By the 1990, OMB extended single audit*
>
> *requirements to non-profit organizations with the issuance of
> Circular A-133,*
>
> *Audits of Institutions of Higher Education and Other Non-Profit
> Organizations.*
>
> *(Colleges and universities were included, but hospitals were not.)*
>
> *With the passage of the Single Audit Act Amendments of 1996 (31
> U.S.C. Chapter 75), single audit requirements were statutorily imposed
> on non-profit organizations that administer federal financial
> assistance programs, including colleges and universities and
> hospitals.*
>
> *VII-1*
>
> *On June 30, 1997, OMB issued revised circular A-133 to implement the
> 1996 amendments and impose the circular's requirements on all types of
> grantees. In doing so OMB rescinded Circular A-128 and prior versions
> of Circular A-133 that applied solely to colleges and universities and
> other non-profit organizations.*
>
> *(Non-U.S. based recipients are not subject to revised Circular A-133,
> but must be monitored through other means by their awarding agency or
> primary grantee.) Several revised provisions have changed the face of
> single audits, namely, the raised threshold for determining whether to
> have a single audit performed and the risk-base approach to auditing
> programs. Clearly, with so many smaller grantees now exempt under the
> raised threshold for single audit, pass-through entities face
> heightened monitoring responsibilities previously met through
> subrecipients' single audit results.*

*3. **[Raised Threshold for Audit]{.underline}**. Under OMB Circular
A-133, the threshold for determining whether a single audit or
program-specific audit must be performed has been raised from \$300,000
in federal funds received to \$500,000 expended annually. Thus,
nonfederal entities (both recipients and subrecipients) that expend
\$500,000 or more annually in federal **funds** for any fiscal year
after December 2003 must have an audit under Circular A-133. Nonfederal
entities that expend less that \$500,000 annually are exempt from
federal audit requirements for that year.*

> *Many grantees are no longer required to have single audits performed*
>
> *under the new threshold, but may be required to have other types of
> audits*
>
> *or evaluations performed (e.g., performance audits or reviews). In
> addition, grantees must maintain records for review of audits by
> federal agency*
>
> *officials, the General Accounting Office or pass-through entities.
> Under*
>
> *Circular A-133, a limited scope audit includes on an agree-upon
> procedures engagement conducted in accordance with Generally Accepted
> Auditing Standards or attestation standards, paid for and arranged by
> a primary*
>
> *grantee, addressing one or more type(s) of compliance requirements
> (specifically, allowable costs/cost principles, eligibility, matching,
> level of*
>
> *effort, earmarking and reporting. (Limited scope audits are available
> for sub-recipient monitoring purposes only.)*
>
> *Pass-through entities that award federal funds to subrecipients
> remain responsible for monitoring sub-recipient activities to ensure
> they comply with program requirements. Pass-through entities can
> monitor subrecipients that expend \$500,000 or more in federal
> assistance by reviewing the results of that sub-recipient's single
> audit. For those subrecipients exempt from a single audit,
> pass-through entities are responsible for monitoring and oversight by
> relying on other procedures.*

*VII-2*

> *The means of monitoring and oversight of subrecipients is left to the
> discretion*
>
> *of the primary grantee under Circular A-133, but could include a
> review of sub-recipient reports or documentation (e.g., evaluate audit
> findings, review corrective action plans), on-site visits, or
> arranging for a limited scope audit. Such monitoring procedures can be
> targeted more selectively and less costly than a full-blown single
> audit.*

***[PREPARING FOR AUDIT]{.underline}***

*The grantee is responsible for making arrangements to have an audit
performed and ultimately faces the consequences of an audit examination.
Careful planning and preparation beforehand by the grantee is an
essential ingredient of a successful audit engagement.*

*1. **[Preparing for Audit]{.underline}**. In general, grantees can take
five basic steps to prepare for an audit:*

-   *determine whether an audit is required by law, regulations or grant
    agreements);*

-   *select and engage an auditor (unless the audit will be conducted by
    a federal auditor);*

-   *reach a mutual understanding with the auditor about the type of
    audit to be performed and its required scope (in doing so, identify
    the entity to be audited the entire organization, individual
    components, governmental departments or units);*

-   *collect and make available to the auditor relevant financial and
    organizational documentation (e.g., charters, by-laws, bank account
    authorizations, financial statements of assets and liabilities,
    schedules of expenditures of federal awards, accounting records,
    cost allocation plans); and*

-   *collect and make available to the auditor relevant compliance
    documentation (e.g., previous audit reports, major contracts, grant
    agreements, a list of subrecipients, federal guidance,
    government-wide directives, statues, program descriptions).*

2.  ***[Audit Responsibilities.]{.underline}** With the enactment of the
    Single Audit Act*

*Amendments of 1996 and issuance of revised Circular A-133, grantees*

> *face new pre-audit reporting responsibilities, such as the
> preparation of a summary schedule of prior year audit findings. In
> preparing for a single or program-specific audit under the revised
> circular, the grantee must:*
>
> *VII-3*

-   *arrange for an audit in accordance with proper procurement of audit
    services;*

-   *maintain internal control (ongoing);*

-   *comply with laws; regulations and grant agreement provisions
    (ongoing);*

-   *identify all federal awards received and expended so that the
    auditor can determine which programs are major programs under
    applicable definitions and must be tested, and how to design audit
    tests considering various risk factors, such as changed conditions,
    the extent to which the program is subgranted or contracted out and
    the adequacy of controls;*

-   *prepare the schedule of expenditures of federal awards (list
    federal programs by agency, the name of any pass-through entities
    and their identification numbers. The total amount of federal awards
    expended for each program, a description of significant accounting
    practices used to prepare the schedule and total amounts awarded to
    subrecipients);*

-   *prepare financial statements (a balance sheet of assets and
    liabilities); and*

-   *prepare a summary schedule of prior audit findings.*

    *Toward the end of the audit process, the grantee will have
    additional reporting tasks to perform:*

-   *prepare portions of the Data Collection Form*

-   *ensure the single audit is performed and reports submitted on
    time;*

-   *prepare any necessary corrective action plan; and*

-   *follow-up and take corrective action on current audit findings.*

3.  ***[Audit Purpose]{.underline}**. Single audits performed under the
    act and revised Circular*

*A-133 cover the entire operation of a grantee or at least those
departments or units that receive, expend or administer federal
financial assistance. The purpose of the single audit is to determine
whether:*

-   *The grantee's financial statements present fairly its true
    financial position and*

    *picture of operations, in accordance with generally accepted
    accounting*

    *principles;*

-   *the grantee has internal accounting and other control systems to
    provide*

    *reasonable assurance that its administration of federal awards
    complies*

    *with relevant laws and regulations; and*

-   *the grantee is in compliance with laws, regulations and agreements
    that*

> *could have a material effect on its financial statements and on each
> major*
>
> *federal assistance program, as defined in the act and revised
> Circular A-133.*

*For further information concerning OMB Circular A-133 Audits of State,
Local Governments, Institutions of Higher Education and Other Non-Profit
Organizations/Institutions, please consult revised OMB Circular A-133.*

*VII-4*

***CHAPTER VIII.***

***[GRANT TERMINATION AND CLOSEOUT]{.underline}***

1.  ***[Terminations and Suspensions]{.underline}**. To terminate a
    grant is to end it before*

*the approved budget period has expired, before project goals are
achieved,*

*and before the entire Federal award has been expended for the purposes*

*originally intended. A termination can be complete or partial. A
termination*

*is implemented only when continued funding of all or a part of a grant
project*

*will no longer produce desired results or when the grantee has
demonstrated a conscious failure to comply with grant conditions. In
lieu of complete termination of a grant, a grant suspension, a temporary
withholding of all or*

*part of the approved funding, can be implemented, to last until some
corrective action is taken. In any case, a grant project which is
prematurely ended or*

*which is temporarily halted will still be subject to the same
requirements regarding record keeping and reports submission as is a
project, which runs uninterrupted for the duration of its approved
budget period.*

a.  *[Termination]{.underline}. Grant termination procedures are
    implemented when*

> *FMCS issues to a grantee a notice of intent to terminate; or when a
> grantee issues to FMCS a similar notice; or when both FMCS and the
> grantee jointly agree that a termination is appropriate. In any case,
> a grant termination is not completed until FMCS issues an actual
> notice*

*of termination in the form of a Grant Adjustment Notice. Upon receipt*

*of a notice of termination the grantee must refund to FMCS all cash
advanced in excess of firm financial commitments of record as of the*

*date of the termination notice. There are two kinds of terminations:*

####### 

> *(1) [Termination for Convenience]{.underline}. Either FMCS or the
> grantee may terminate the grant in whole or in part, when both parties
> agree*
>
> *that the continuation of the project would not produce beneficial
> results commensurate with the further expenditure of funds.*
>
> *The two parties shall agree upon the termination conditions,
> including the effective date and, in the case of partial terminations,
> the portion to be terminated. The grantee shall not incur new*
>
> *obligations for the terminated portion after the effective date, and
> shall cancel as many outstanding obligations as possible. FMCS will
> allow full credit to the grantee for the Federal share of the
> remaining obligations properly incurred by the grantee prior to
> termination.*

*VIII-1*

2.  *[Termination for Cause]{.underline}. FMCS may terminate any grant
    in whole or in part at any time before the scheduled date of
    completion, whenever it is determined by FMCS that the grantee has
    failed to comply with the conditions of the grant. Such action,
    however, will be preceded when-ever possible by a letter of warning
    giving the grantee 30 days to reach full condition compliance.
    Should the grantee fail to reach compliance, FMCS will then promptly
    notify the grantee in writing of*

> *its final determination and the reasons for the termination,
> together*
>
> *with the effective date of termination. Payments made to grantees or*
>
> *recoveries made by FMCS under grants terminated for cause shall be*
>
> *in accord with the legal rights and liabilities of the parties.*

b.  *[Suspension]{.underline}. FMCS may, until corrective action is
    taken, suspend a grant*

> *in whole or in part, withhold Federal fund payments, and prohibit
> additional grantee obligations and expenditures of funds whenever the
> grantee has demonstrated or threatened a material failure to comply
> with grant award stipulations, standards, and conditions. All
> suspensions are effective on*
>
> *the date of delivery of a suspension notice to the grantee. There are
> two kinds of suspensions.*

*(1) [Suspension on Notice]{.underline}. As the name implies, a
suspension on notice is preceded by written notification to the grantee
of FMCS intent to suspend assistance in whole or in part unless good
cause is shown why assistance should not be suspended. Should no cause
be shown within a reasonable period of time, FMCS would then issue the
suspension by means of a Grant Adjustment Notice.*

*(a) A suspension will not exceed 30 days in length unless during that
period termination proceedings are begun or FMCS and the grantee agree
to a continuation of the suspension.*

*(b) If termination proceedings are initiated during the life of the
suspension, the suspension remains in effect until such proceedings are
fully concluded.*

c.  *During a period of suspension, the grantee may incur no*

> *new obligations in connection with the suspended grant*
>
> *or grant component without FMCS written authorization.*

*VIII-2*

######### 

######### 

*(2) [Summary Suspension]{.underline}. A summary suspension is one
levied upon a grantee without notice and without an opportunity to show
cause. It is issued only after FMCS has determined that immediate
suspension is necessary because of a serious risk of substantial injury
to or loss of project funds or property; or of violation of a Federal,
state, or local criminal statute, or of FMCS rules regula-tions,
guidelines and instructions; and that such risk is sufficiently serious
to outweigh the general policy in favor of advance notice and
opportunity to show cause.*

*(a) A notice of summary suspension is delivered to the grantee by
letter or telegram.*

*(b) The notice includes the duration, extent, terms and conditions of
any suspension, complete or partial, and prohibits the grantee from
making any new expenditures*

*or incurring any new obligations in connection with the suspended grant
or grant component.*

*(3) [In Any Suspension]{.underline}. Expenditures to fulfill legally
enforceable commitments made prior to the notice of suspension, in good*

*faith and in accordance with the grantee\'s approved work program and
not in anticipation of suspension or termination, shall not be
considered additional expenditures. However, funds shall not be
recognized as committed solely because the grantee has obligated them by
contract or otherwise.*

####### 

*2. **[Closeout]{.underline}**. Closeout is the grant process by which
FMCS determines whether all applicable administrative actions and all
required work within the grant have been completed by the concerned
parties. The closeout process is initiated on the date that all work
under a grant is completed, or on the latest approved date on which FMCS
financial assistance ends.*

*a. FMCS will make prompt payments to a grantee for allowable
reimbursable costs under the grant being closed out if such payments are
requested and if funds remain in the grant\'s account.*

*b. As soon as possible after the grant project is concluded, the
grantee must refund to FMCS any balance of unobligated Federal dollars
advanced to the grantee.*

*VIII-3*

*c. Within 90 days of the project\'s conclusion, the grantee must meet
its unpaid grant obligations and submit to FMCS final financial and
performance reports, and other reports required as a grant condition.*

*The grantee shall include in its final submission a current accounting*

*for any property acquired with grant project funds. The 90-day final
reporting period may be extended for valid reasons, upon the grantee\'s
written presentation and request.*

1.  *[Final Financial Status Report]{.underline}. This report must show
    expenditure of the grantee share of approved costs, and a zero
    balance for unliquidated obligations. It must indicate the exact
    amount of unobligated grant funds which are to be deobligated by
    FMCS*

> *from the grant.*

*(2) [Final Performance Report]{.underline}. This report is a summary of
the project\'s success in adhering to the goals, objectives, and
implementation plan of the grant.*

*(3) If required, a financial and compliance audit of the grant
project.*

*d. Within 60 days of receipt from the grantee of accurate final reports
as described above, FMCS will issue a final Grant Adjustment Notice,
which formally closes out the grant.*

*e. [Cautionary Provisions]{.underline}.*

*(1) No adjustment to payments for costs incurred by the grantee under a
grant during the grant closeout period shall be construed as increasing
the amount of Federal funds within a grant above the amount shown on the
applicable Notice of Award.*

*(2) FMCS records retention requirements as described in this manual
must be observed.*

*3. **[Records Retention and Access]{.underline}**.*

a.  *[Grant Project Records]{.underline} must be retained by the grantee
    for a period of three years following the date of grantee submission
    to FMCS of the project\'s final financial status report. Grant
    project records include but are not limited to grant financial
    records and related original and supporting documents that
    substantiate costs charged to the activity. Financial records,
    identifiable by*

> *VIII-4*
>
> *grant number, include all accounting records and reports, supporting
> documents, statistical records, property records, and all other
> records, books and papers pertinent to a grant project, including
> books of original entry, source documents which support accounting
> transactions, the general ledger, subsidiary ledgers, personnel and
> payroll records, canceled checks, and related documents and records.
> Source documents include copies of all grant and subgrant awards,
> applications and required grantee financial and performance reports.
> Personnel and payroll records must include the time and attendance
> reports for all individuals reimbursed under a grant, whether they are
> employed full-time or part-time. Time and effort reports are required
> for consultants. The Director, FMCS, and the Comptroller General of
> the United States or any of either\'s duly authorized representatives
> shall have access to all records to make audits, examinations,
> excerpts, and transcripts.*

*b. [Exceptions]{.underline} to the normal three-year retention period
are as follows:*

*(1) If any litigation claim or audit is begun before the expiration of*

*the normal three-year retention period, the grant project\'s records
must be retained until all litigations, claims, or adverse audit
findings involving the records have been resolved.*

> *(2) Records for non-expendable personal property acquired wholly or
> in part with Federal funds must be retained for three years after the
> grantee\'s final disposition of the property.*

####### VIII-5

***APPENDIX 1***

***GLOSSARY OF TERMS***

***[Budget Period]{.underline}**. The intervals of time into which a
project period is divided for budgetary and funding purposes. In the
FMCS grant program, two budget periods are ordinarily the maximum number
funded within a project\'s Federally supported duration. **Your budget
period is specifically listed in Block 7 of your Award Notice.***

***[Categorical Grant]{.underline}**. A grant, which is competitive in
nature and for which limited funds are available. All FMCS grants are
categorical.*

***[Contract]{.underline}**. A legal instrument reflecting a
relationship between the Federal government and a State or local unit of
government or other recipient; or between any two parties. The Federal
government advocates the use of a contractual instrument whenever*

*the relationship\'s principal purpose is the acquisition by purchase,
lease, or barter of property or services for the direct benefit or use
of the Federal government or a grantee; or whenever the Federal
government or its grantee determines in a specific instance that the use
of a contractual agreement is more appropriate to mutual purposes than
is a grant or a cooperative agreement. Unless otherwise stated or
enlarged, the policies and requirements applied in this manual to
grants, grantors, and grantees also apply to contracts and the parties
to a contractual agreement.*

***[Contractor]{.underline}**. A party to a contractual agreement.*

***[Cooperative Agreement]{.underline}**. A legal instrument reflecting
a relationship between the Federal government and a unit of State or
local government or other recipient, for purposes similar to those of a
grant but in which substantial Federal involvement beyond the funding
aspect is anticipated. Unless otherwise stated or enlarged, the policies
and requirements applied in this manual to grants, grantors, and
grantees*

*also apply to cooperative agreements and their parties.*

***[Date of Completion]{.underline}**. The calendar date on which all
programmatic work under*

*a grant is completed; or the date shown on the grant\'s Notice of Award
or a*

*subsequent Grant Adjustment Notice as the final day in the grant\'s
project period.*

***1 OF 3***

***[Disallowed Cost]{.underline}**. Those charges to a grant, either
anticipated or effected, that FMCS determines to be unacceptable or
which are unallowable in accordance with Federal cost principles.*

***[Disbursements]{.underline}.** Payments made by check or in cash.*

***[Grant]{.underline}**. A legal instrument reflecting a relationship
the principal purpose of which is*

*the transfer of money or property in lieu of money paid by the Federal
government*

*to a State or local unit of government or to another recognized
recipient, in order to accomplish a public purpose of support or
stimulation authorized by Federal statute. During performance of the
contemplated activity no substantial involvement other than financial is
anticipated between the executive agency acting for the Federal
government and the grant recipient.*

***[Grantee]{.underline}**. The State, local government or other unit
designated by FMCS as the prime recipient of grant funds.*

*[**Granto**r]{.underline}. The Federal agency authorized by Congress to
enter into agreements with units of State or local government or with
other entities for the purpose of a grant.*

***[Indirect Costs]{.underline}**. Those costs incurred for a common or
joint purpose benefiting*

*more than one program or cost objective which are not readily
assignable to the*

*cost objectives or programs specifically benefited, without effort
disproportionate*

*to the results achieved.*

***[Local Government]{.underline}**. A local unit of government
including a county, municipality, city, town, township, local public
authority, school district, council of governments, sponsor group
representative organization and other regional or interstate government
entity, or any agency or instrumentality of a local government exclusive
of institutions of higher education and hospitals.*

***[Prior Approval]{.underline}**. Prior written permission by FMCS. Any
requests for such approval must be signed by an authorized official of
the applicant or grantee organization.*

***[Program]{.underline}**. An overall grant activity specifically
authorized by Congress.*

***2 OF 3***

***[Project]{.underline}.** A specifically identified individual
activity within a grant program, which is supported in whole or in part
by a grant, contract, or cooperative agreement.*

***[Project Director]{.underline}**. The individual designated by the
grantee as the person responsible for the overall conduct, direction and
supervision of the project.*

#### [Project Income]{.underline}. Net income generated by grant-supported activity or personnel. This 

#### income must be reported on the LM-6 form and subtracted from total program outlays.

####  

***[Project Period]{.underline}**. The total length of time for which
Federal support of a project is approved. The project period may vary
from several months to several years and consists of one or more budget
periods. However, FMCS approval of a project period does not constitute
a commitment by FMCS to provide financial support beyond the budget
period for which a grant has been made.*

***[Secondary Recipient]{.underline}**. A unit of State or local
government or another entity serving*

*a grantee as either a subgrantee or a contractor or a subcontractor.*

***[State]{.underline}**. Any of the several States of the United
States, the District of Columbia, the Commonwealth of Puerto Rico, any
territory or possession of the United States, or*

*any agency or instrumentality of a State exclusive of institutions of
higher education*

*and hospitals.*

***[Subcontractor]{.underline}**. A party to a contractual agreement,
which is a part of another, usually larger, contract.*

***[Subgrantee]{.underline}**. A unit of State or local government or
another entity to which the grantee, after receiving a grant award,
grants in turn all or a portion of the funds.*

***[Unacceptable Costs]{.underline}**. Charges to a grant, either
anticipated or effected, which FMCS determines to be disallowed because
of agency funding policy.*

***3 OF 3***

> ***APPENDIX 2***
>
> ***CONTRACT PROVISIONS UNDER FMCS GRANTS***
>
> *In addition to provisions defining a sound and complete procurement
> contract, any recipient of FMCS grant funds shall include the
> following contract provisions or conditions in all procurement
> contracts and subcontracts as required by the provision, Federal law,
> or the grantor agency.*
>
> *1. Contracts other than small purchases shall contain provisions or
> conditions, which will allow for administrative, contractual, or legal
> remedies in instances where contractors violate or breach contract
> terms, and provide for such sanctions and penalties as may be
> appropriate.*

2.  *All contracts in excess of \$10,000 shall contain suitable
    provisions for*

> *termination by the grantee including the manner by which it will be
> effected*
>
> *and the basis for settlement. In addition, such contracts shall
> describe*
>
> *conditions under which the contract may be terminated for default as
> well as conditions where the contract may be terminated because of
> circumstances beyond the control of the contractor.*
>
> *3. All contracts, including small purchases shall contain a provision
> requiring compliance with Executive Order 11246, entitled \"Equal
> Employment Opportunity,\" as amended by Executive Order 11375, and as
> supplemented*
>
> *in Department of Labor regulations (41 CFR Part 60).*
>
> *4. Where applicable, all contracts awarded by grantees and
> subgrantees in*
>
> *excess of \$2000 for construction contracts and in excess of \$2500
> for other contracts which involve the employment of mechanics or
> laborers shall*
>
> *include a provision for compliance with Sections 102 and 107 of the
> Contract Work Hours and Safety Standards Act (40 USC 327-333) as
> supplemented*
>
> *by Department of Labor regulations (29 CFR Part 5).*
>
> *5. The contract shall include notice of grantor agency requirements
> and regulations pertaining to reporting and patent rights under any
> contract involving research, developmental, experimental, or
> demonstration work with respect to any discovery or invention which
> arises or is developed in the course of or under such contract, and of
> grantor agency regulations pertaining to copyrights and rights in
> data.*
>
> ***(APPENDIX 2) 1 OF 2***

6.  *All negotiated contracts awarded by grantees shall include a
    provision to the*

> *effect that the grantee, the Federal grantor agency, the Comptroller
> General*
>
> *of the United States, or any of their duly authorized
> representatives, shall have access to any books, documents, papers,
> and records of the contractor which are directly pertinent to that
> specific contract, for the purpose of making audit, examination,
> excerpts, and transcriptions.*
>
> *7. Grantees shall require contractors to maintain all required
> records for three*
>
> *years after grantees make final payments and all other pending
> matters are closed.*

8.  *Contracts shall recognize mandatory standards and policies relating
    to energy*

> *efficiency, which are contained in the State energy conservation plan
> issued*
>
> *in compliance with the Energy Policy and Conservation Act (P.L.
> 94-163).*
>
> *9. Purchases of paper and paper products in excess of \$10,000 must
> meet recovered materials purchasing requirements, which mandate the
> purchase*
>
> *of such items containing the highest percentage of recovered
> materials practicable. See Sections 2002(a) and 6002 of the Solid
> Waste Disposal*
>
> *Act, as amended by the Resource Conservation and Recovery Act of
> 1976.*

10. *No contracts, including small purchases, shall be made with parties
    listed on*

> *the General Services Administration\'s list of Parties Excluded from
> Federal Procurement or non-Procurement Programs in accordance with
> Executive*
>
> *Order 12549.*
>
> ***(APPENDIX 2) 2 OF 2***

![](media/image2.wmf){width="6.948611111111111in"
height="8.98611111111111in"}

![](media/image3.jpeg){width="8.210416666666667in"
height="9.181944444444444in"}

> ***APPENDIX 3***
>
> ***[Labor Management Budget]{.underline}***
>
> * *
>
> *a. [**Personnel**]{.underline} (includes cost of living increase
> after 12 months; estimated in accordance with established policy @ 4%
> for coming year)*
>
> * *
>
> *Executive Director 12 months @\$2,500/mo. 1 00% 30,000*
>
> *6 months @ 2,600/mo. 100% 15,600*
>
>   Secretary 12 months @ \$*1,208/mo.* *100% 14,496*
>
> *6 months \@1,256/mo. 100% [7,536]{.underline}*
>
> ***\$67,632***
>
> * b. **[Fringe Benefits]{.underline}***
>
> *  Social Security @ 7.65% 5,174*
>
> *Health Insurance @ 10% 6,763*
>
> *Established applicant pension plan contribution @ 8%
> [5,411]{.underline}*
>
> ***\$17,348***
>
> *c. **[Travel]{.underline} \$11,137***
>
> *  1 1 ½ -day round trip, Washington, DC, for progress review*
>
> *(Project Director and Accountant)*
>
> *Airfare @ \$500 RT x 1 trip x 2 travelers \$1,000*
>
> *Hotel @ \$200/day x 1 ½ days x 1 trip x 2 travelers 600*
>
> *Per diem @ 50/day x 1 ½ days x 1 trip x 2 travelers
> [150]{.underline}*
>
> *\$1,750*
>
> *1 3-day round trip to attend the National Labor-Management
> Conference*
>
> *  (Grantees may charge no [more than 3 people]{.underline} to the
> grant)*
>
> *Airfare @\$500 RT x 1 trip x 3 travelers \$1,500*
>
> *Hotel @ \$200/day x 3 days x 1 trip x 3 travelers 1,800*
>
> *Per diem @ 50/day x 3 days x 1 trip x 3 travelers 450*
>
> *Registration @\$450/person x 3 travelers [1,350]{.underline}*
>
> \$6,675
>
>   *Daily Office Travel*
>
> *  100 miles/week x 73 x \$.405/mile 2,957*
>
> * *
>
> *Off-Site Committee Retreat (LMC Committee)*

#####  Per diem @ \$50 day x 2 days x 10 members 1,000

> *Mileage - 10 members (rides shared) [330]{.underline}*
>
> *\$4287*

*d. **[Supplies]{.underline} \$990***

> *Consumables (paper, pens, paper clips,*
>
> *etc.,) @ \$25/person/month x 18 months \$450*
>
> *Postage @ \$30/month for 18 months [\$540]{.underline}*
>
> ***\$990***
>
> ***(APPENDIX 3) 3 OF 6***
>
> *e. **[Equipment]{.underline} ***
>
> *1 Executive desk @ \$300 \$300*
>
> *1 Secretarial desk 295 295*
>
> *1 Executive chair 75 75*
>
> *1 Secretarial chair 100 100*
>
> *4 Side chairs 50 200*
>
> *1 File cabinet 100 100*
>
> *1 Desktop Computer 3,100 [3,100]{.underline}*
>
> ***\$4,170***
>
> *f. **[Contractual]{.underline} \$10,000***
>
> *Consultant to assist with special training programs*
>
> *(\$950 day for 5 days) as discussed in text \$4,750*
>
> *Consultant (project evaluation)*
>
> *(\$300/day for 10 days) \$3,000*
>
> *Website Development @ \$150hr x 15 [2,250]{.underline}*
>
> ***\$ 10,000***
>
> *g. **[Other]{.underline} \$6,161***
>
> *Space rental 400 sq. feet @ \$4 per \$2,400*
>
> *square foot for 1.5 years*
>
> * *
>
> *Phones, 1 line*
>
> Installation @ \$50 50
>
> Local use @ \$20/month, 18 months 360
>
> Long distance @ \$25/month, 18 months Reproduction/printing\--machine
> rental, 450
>
> *paper, etc., for 18 months 1,500  *
>
> Janitorial @ \$17/week, 73 weeks 1,241 Equipment maintenance 18 months
> [160]{.underline}
>
> **\$6,161**

## TOTAL PROJECT COST [\$117,438]{.underline}  

> *Total project cost \$117,438 x 10% match = 11,743; 117,438 --11,743 =
> 105,695(federal)*
>
> *Federal 105,695*
>
> *Match (10 %) [11,743]{.underline}*
>
> *Total* \$*117,438*
>
> ***(APPENDIX 3) 4 OF 6***
>
> **OMB Approval No. 3076-0006**

**ASSURANCES - NON-CONSTRUCTION PROGRAMS**

**Note:** Certain of these assurances may not be applicable to your
project or program. If you have any

questions, please contact the awarding agency. Further, certain Federal
awarding agencies may

require applicants to certify to additional assurances. If such is the
case, you will be notified.

As the duly authorized representative of the applicant, I certify that
the applicant:

1\. Has the legal authority to apply for Federal

> assistance, and the institutional, managerial
>
> and financial capability (including funds suffi-cient to pay the
> non-federal share of project costs) to ensure proper planning,
> management and completion of the projected described in
>
> this application.

2.  Will give the awarding agency, the Comptroller General of the United
    States, and if appropriated, the State, through any authorized
    representative, access to and the right to examine all records,
    books, papers, or documents related to the award; and will establish
    a proper accounting

system standards or agency directives.

3.  Will establish safeguards to prohibit employees from using their
    positions for a purpose that constitutes or presents the appearance
    of personal or organizational conflict of interest,

or personal gain.

4.  Will initiate and complete the work within the applicable time frame
    after receipt of approval

of the awarding agency.

5.  Will comply with the Intergovernmental Personnel Act of 1970 (42
    U.S.C.4728-4753) relating to prescribed standards for merit systems
    for program funded under one the nineteen statutes or regulations
    specified in Appendix A of OPM's Standards for a Merit System of
    Personnel Administration (5 C.F.R. 900, Subpart F).

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6.  Will comply with all Federal Statutes relating to
    non-discrimination. These include but are not limited to: title VI
    of the Civil Rights Act of 1964 (P.L. 88-352) which prohibits
    discrimination on the basis of races, color or national origin; (b)
    Title IX of the Education Amendments of 1972, as amended (20 U.S.C.
    1681-1683, and 1685-1686), which prohibits discrimination on the
    basis of sex; (c ) Section 504 of the Rehabilitation Act

> of 1973, as amended (29 U.S.C. 794),
>
> which prohibits discrimination on the basis
>
> of handicaps; (d) the Age Discrimination
>
> Act of 1975, as amended (42 U.S.C. 6101-6107), which prohibits
> discrimination on the basis of age; (e) the Drug Abuse office and
> Treatment Act of 1972 (P.L. 92-255), as amended, relating to
> non-discrimination on the basis of drug abuse; (f) the Comprehensive
> Alcohol Abuse and Alcohol-ism Prevention, Treatment and Rehabilitation
> Act of 1970 (P.L. 91-616), as amended, relating to non-discrimination
> on the basis of alcohol abuse or alcoholism; (g) 523 and 527 of the
> Public Health Service Act of 1912 (42 U.S.C. 290 dd-3 and 290 ee-3),
> as amended, relating to confidentiality of alcohol and drug abuse
> patient records; (h) Title VIII of the Civil Rights Act of 1968 (42
> U.S.C. 3601 et seq.), as amended, relating to non-discrimination in
> the sale, rental or financing of housing: (i) Executive Order 13166
> providing for non-discrimination for persons with limited English
> proficiency; (j) any other non-discrimination provisions in the
> specific statute(s) under which application for Federal assistance is
> being made; and (k) the requirements of any other nondiscrimination
> statute(s) which may apply to the application.

7\. Will comply, or has already complied, with the requirements of
Titles II and III of the Uniform

> Relocation Assistance and Real Property
>
> Acquisition Policies Act of 1970 (P.L. 91-646)
>
> which provide for fair and equitable treatment of
>
> persons displaced or whose property is acquired
>
> as a result of Federal or federally assisted programs. These
> requirements apply to all interests in real property acquired for
> project purposes regardless of Federal participation in purchases.
>
> 8\. Will comply with the provisions of the Hatch Act
>
> (5 U.S.C. 1501-1508 and 7324-7328) which limit
>
> the political activities are funded in whole or in part with Federal
> funds.

(APPENDIX 3)

5 of 6

> **Standard Form 424B (Rev 7-97) Prescribed by OMB Circular A-102**

![](media/image4.wmf){width="6.496527777777778in"
height="8.401388888888889in"}

![](media/image5.jpeg){width="7.870833333333334in"
height="10.029166666666667in"}

**INSTRUCTIONS FOR THE SF 424**

This is a standard form used by applicants as a required facesheet for
preapplications and applications submitted for Federal assistance. It
will be used by Federal agencies to obtain applicant certification that
States which have established a review and comment procedure in response
to Executive Order 12372 and have selected the program to be included in
their process, have been given an opportunity to review the applicant's
submission.

**Item: Entry**

1.  Self-explanatory.

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2.  Date application submitted to Federal agency

(or State if applicable) and applicant's control

number (if applicable).

3.  State use only (if applicable).

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```
4.  If this application is to continue or revise an

existing award, enter present Federal identifier

number. If for a new project, leave blank.

5.  Legal name of applicant, name of primary

organizational unit which will undertake the

assistance activity, complete address of the

applicant, and name and telephone number

of the person to contact on matters related

to this application.

6.  Enter Employer Identification Number (EIN) as

assigned by the Internal Revenue Service.

7.  Enter the appropriate letter in the space

provided.

8.  Check appropriate box and enter appropriate

letter(s) in the space(s) provided:

\_\_"New" means a new assistance award.

\_\_ "Continuation" means an extension for an

additional funding/budget period for a project

with a projected completion date.

\_\_ "Revision" means any change in the Federal

Government's financial obligation or

contingent liability from an existing

obligation.

9.  Name of Federal agency from which assistance

is being requested with this application.

10\. Use the Catalog of Federal Domestic

Assistance number and title of the program

under which assistance is requested.

**Item: Entry**

11. Enter a brief descriptive title of the project.

If more than one program is involved, you

should append an explanation on a separate

sheet. If appropriate (e.g., construction or

real property projects), attach a map showing

project location. For preapplications, use

a separate sheet to provide a summary

description of this project.

12\. List only the largest political entities affected

(e.g., State, counties, cities).

13\. Self-explanatory.

14. List the applicant's Congressional District and

District(s) affected by the program or project.

15. Amount requested or to be contributed during the

first funding/budget period by each contributor.

Value of in-kind contributions should be included on

appropriate lines as applicable. If the action will

result in a dollar change to an existing award,

indicate *[only]{.underline}* the amount of the change. For

decreases, enclose the amounts in parentheses.

If both basic and supplemental amounts are

included, show breakdown on an attached sheet.

For multiple program funding, use to totals and

show breakdown using same categories as

item 15.

16. Applicants should contact the State Single Point of

Contact (SPOC) for Federal Executive Order 12372 to

determine whether the application is subject to the

State intergovernmental review process.

17. This question applies to the applicant organization,

not the person who signs as the authorized

representative. Categories of debt include

delinquent audit disallowance's, loans, and taxes.

18. To be signed by the authorized representative of

the applicant. A copy of the governing body's

authorization for you to sign this application as

official representative must be on file in the

applicant's office. (Certain Federal agencies may

require that this authorization be submitted as part

of the application).

(APPENDIX 4) SF-424 (Rev. 7-97)

2 of 8

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height="8.829166666666667in"}

> INSTRUCTIONS FOR THE SF-424A
>
> General Instructions
>
> This form is designed so that application can be made for funds from
> one or more grant programs. In preparing the budget, adhere to any
> existing Federal Grantor agency guidelines, which prescribe how, and
> whether budgeted amounts should be separately shown for different
> functions or activities within the program. For some programs, grantor
> agencies may require budgets to be separately shown by function or
> activity. For other programs, grantor agencies may require a breakdown
> by function or activity. Sections A, B, C, and D should include budget
> estimates for the whole project except when applying for assistance
> which requires Federal authorization in annual or other funding period
> increments. In the latter case, Sections A, B, C, and D should provide
> the budget for the first budget period (usually a year) and Section E
> should present the need for Federal assistance in the subsequent
> budget periods. All applications should contain a breakdown by the
> object class categories shown in lines a-k of Section B.
>
> Section A. Budget Summary Lines 1-4 Columns (a) (b)
>
> For applications pertaining to a single Federal grant program (Federal
> Domestic Assistance Catalog number) and not requiring a functional or
> activity breakdown, enter on Line 1 under Column (a) the Catalog
> program title the Catalog number in Column (b).
>
> For applications pertaining to a single program requiring budget
> amounts by multiple functions or activities, enter the name of each
> activity or function on each line in Column (a), and enter the Catalog
> number in Column (b). For applications pertaining to multiple programs
> where none of the programs require a breakdown by function or
> activity, enter the Catalog program title on each line in Column (a)
> and the respective Catalog number on each line in Column (b).
>
> For applications pertaining to multiple programs where one or more
> programs require a breakdown by function or activity, prepare a
> separate sheet for each program requiring the breakdown. Additional
> sheets should be used when one form does not provide adequate space
> for all breakdown of data required. However, when more than one sheet
> is used, the first page should provide the summary totals by programs.
>
> Lines 1-4, Columns (c) through (g)
>
> For new applications, leave Column (c) and (d) blank. For each line
> entry in Columns (a) and (b), enter in columns (e), (f), and (g) the
> appropriate amounts of funds needed to
>
> support the project for the first funding period (usually a year). For
> continuing grant program applications, submit these forms before the
> end of each funding period as required by the grantor agency. Enter in
> Columns (c) and (d) the estimated amounts of funds which will remain
> unobligated at the end of the grant funding period only if the Federal
> grantor agency instructions provide for this. Otherwise, leave these
> columns blank. Enter in Columns (e) and (f) the amounts of funds
> needed for the upcoming period. The amount(s) in Column (g) should be
> the sum of amounts in Columns (e) and (f).
>
> For supplemental grants and changes to existing grants, do not use
> Columns (c) and (d). Enter in Column (e) the amount of the increase or
> decrease of Federal funds and enter in Column (f) the amount of the
> increase or decrease of non-Federal funds. In Column (g) enter the new
> total budgeted amount (Federal and non-Federal) which includes the
> total previous authorized budgeted amounts plus or minus, as
> appropriate, the amounts shown in Columns (e) and (f). The amount(s)
> in Column (g) should not equal the sum of amounts in Columns (e) and
> (f).
>
> Line 5 - Show the totals for all columns used.
>
> Section B Budget Categories
>
> In the column headings (1) through (4), enter the titles of the same
> programs, functions, and activities shown on Lines 1-4, Column (a),
> Section A. When additional sheets are prepared for Section A, provide
> similar column headings on each sheet. For each program, function or
> activity, fill in the total requirements for funds (both Federal and
> non-Federal) by object class categories.
>
> Lines 6a-i - Show the totals of Lines 6a to 6h in each column
>
> Line 6j - Show the amount of indirect cost.
>
> Line 6k - Enter the total of amounts on Lines 6i and 6j. For all
> applications for new grants and continuation grants the total amount
> in Column (5), line 6k, should be the same as the total amount shown
> in Section A, Column (g), Line 5. For supplemental grants and changes
> to grants, the total amount of the increase or decrease as shown in
> Columns (1) - (4), Line 6k should be the same as the sum of the
> amounts in Section A, Columns (e) and (f) on Line 5.
>
> Line 7 - Enter the estimated amount of income, if any, expected to be
> generated from this project. Do not add or subtract this amount from
> the total project amount, Show under the program.
>
> (APPENDIX 4)
>
> 4 of 8 SF-424A (Rev. 7-97)

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**INSTRUCTIONS FOR THE SF-424A** (continued)

Show under the program narrative statement the nature and source of
income. The estimated amount of program income may be considered by the
Federal grantor agency in determining the total amount of the grant.

# *Section C. Non-Federal Resources*

**Lines 8-11** Enter amounts of non-Federal resources that will be used
on the grant. If in-kind contributions are included, provide a brief
explanation on a separate sheet.

> **Column (a)** -- Enter the program titles identical to Column (a),
> Section A. A breakdown by function or activity is not necessary.
>
> **Column (b)** -- Enter the contribution to be made by the applicant.
>
> **Column (c)** -- Enter the amount of the State's cash and in-kind
> contribution if the applicant is not a State or State agency.
> Applicants which are a State or State agencies should leave this
> column blank.
>
> **Column (d)** -- Enter the amount of cash and in-kind contributions
> to be made from all other sources.
>
> **Column (e)** -- Enter totals of Columns (b), (c) and (d).

**Line 12** -- Enter the total for each of Columns (b)-(e). The amount
in Column (e) should be equal to the amount on Line 5, Column (f),
Section A.

***Section D**. **Forecasted Cash Needs***

**Line 13** -- Enter the amount of cash needed by quarter from the
grantor agency during the first year.

**Line 14** -- Enter the amount of cash from all other sources needed by
quarter during the first year.

**Line 15** -- Enter the totals of amounts on Lines 13 and 14.

***Section E. Budget Estimates of Federal***

***Funds Needed for Balance of the Project***

**Lines 16-19** -- Enter in Column (a) the same grant program titles
shown in Column (a), Section A. A breakdown by function or activity is
not necessary. For new applications and continuation grant applications,
enter in the proper columns amounts of Federal funds which will be
needed to complete the program or project over the succeeding funding
periods (usually in years). This section need not to be completed for
revisions (amendments, changes or supplements) to fund for the year of
existing grants.

If more than four lines are needed to list the program titles, submit
additional schedules as necessary.

**Line 20** -- Enter the total for each of the Columns (b)-(e). When
additional schedules are prepared for this Section, annotate accordingly
and show the overall totals on this line.

## Section F. Other Budget Information

**Line 21** -- Use this space to explain amounts for individual direct
object class cost categories that may appear to be out of the ordinary
or to explain the details as required by the Federal grantor agency.

**Line 22** -- Enter the type of indirect rate (provisional,
predetermined, final or fixed) that will be in effect during the funding
period, the estimated amount of the base to which the rate is applied,
and the total indirect expense.

**Line 23** -- Provide any other explanations or comments deemed
necessary.

> **ro**

OMB Approval No. 3076-006

ASSURANCES - NON-CONSTRUCTION PROGRAMS

**Note:** Certain of these assurances may not be applicable to your
project or program. If you have any

questions, please contact the awarding agency. Further, certain Federal
awarding agencies may

require applicants to certify to additional assurances. If such is the
case, you will be notified.

As the duly authorized representative of the applicant, I certify that
the applicant:

1\. Has the legal authority to apply for Federal

> assistance, and the institutional, managerial and financial capability
> (including funds sufficient to pay the non-federal share of project
> costs) to ensure proper planning, management and completion of the
> projected described in this application.

2.  Will give the awarding agency, the Comptroller General of the United
    States, and if appropriated,

> the State, through any authorized representative, access to and the
> right to examine all records, books, papers, or documents related to
> the award; and will establish a proper accounting system standards or
> agency directives.

3.  Will establish safeguards to prohibit employees from using their
    positions for a purpose that constitutes

> or presents the appearance of personal or organiza-tional conflict of
> interest, or personal gain.

4.  Will initiate and complete the work within the applicable time frame
    after receipt of approval

of the awarding agency.

5.  Will comply with the Intergovernmental Personnel Act of 1970 (42
    U.S.C.4728-4753) relating to prescribed standards for merit systems
    for program funded under one the nineteen statutes or regulations
    specified in Appendix A of OPM's Standards for a Merit System of
    Personnel Administration (5 C.F.R. 900, Subpart F).

6.  Will comply with all Federal Statutes relating to
    non-discrimination. These include but are not limited to: title VI
    of the Civil Rights Act of 1964 (P.L. 88-352) which prohibits
    discrimination on the basis of races, color or national origin; (b)
    Title IX of the Education Amendments of 1972, as amended (20 U.S.C.
    1681-1683, and 1685-1686), which prohibits discrimina-tion on the
    basis of sex; (c ) Section 504 of the Rehabilitation Act of 1973, as
    amended (29 U.S.C. 794),

> which prohibits discrimination on the basis of handicaps; (d) the Age
> Discrimination Act of 1975,
>
> as amended (42 U.S.C. 6101-6107), which prohibits discrimination on
> the basis of age; (e) the Drug Abuse office and Treatment Act of 1972
> (P.L. 92-255), as amended, relating to non-discrimination on the basis
> of drug abuse; (f) the Comprehensive Alcohol Abuse and Alcoholism
> Prevention, Treatment and Rehabilitation Act of 1970 (P.L. 91-616), as
> amended, relating to non-discrimination on the basis of alcohol abuse
> or alcoholism; (g) 523 and 527 of the Public Health Service Act of
> 1912 (42 U.S.C. 290 dd-3 and 290 ee-3), as amended, relating to
> confidentiality of alcohol and drug abuse patient records; (h) Title
> VIII of the Civil Rights Act of 1968 (42 U.S.C. 3601 et seq.), as
> amended, relating to non-discrimination in the sale, rental or
> financing of housing: (i) Executive Order 13166 providing for
>
> non-discrimination for persons with limited English proficiency; (j)
> any other non-discrimination provisions in the specific statute(s)
> under which application for Federal assistance is being made; and (k)
> the requirements of any other nondiscrimination statute(s) which may
> apply to the application.

7\. Will comply, or has already complied, with the requirements of
Titles II and III of the Uniform

> Relocation Assistance and Real Property
>
> Acquisition Policies Act of 1970 (P.L. 91-646)
>
> which provide for fair and equitable treatment of
>
> persons displaced or whose property is acquired
>
> as a result of Federal or federally assisted programs. These
> requirements apply to all interests in real property acquired for
> project purposes regardless of Federal participation in purchases.
>
> 8\. Will comply with the provisions of the Hatch Act
>
> (5 U.S.C. 1501-1508 and 7324-7328) which limit
>
> the political activities are funded in whole or in
>
> part with Federal funds.

(APPENDIX 4)

7 of 8

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height="9.027777777777779in"}

**APPENDIX 5**

**CERTIFICATION REGARDING DRUG-FREE**

**WORKPLACE REQUIREMENTS**

A.  The grantee certifies that it will provide a drug-free workplace by:

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```
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;

> \(b\) Establishing a drug-free awareness program to inform employees
> about:
>
> 1\. 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;

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);

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 of any criminal drug statute conviction for a
    violation occurring

> in the workplace no later than five days after such conviction;

e.  Notifying the agency within ten days after receiving notice under
    subparagraph (d) 2.,

> from an employee or otherwise receiving actual notice of such
> conviction;
>
> \(f\) Taking one of the following actions, within 30 days of receiving
> notice under
>
> subparagraph (d) w., with respect to any employee who is so convicted:
>
> 1\. Taking appropriate personnel action against such an employee, up
> to an including
>
> termination; 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;
>
> \(g\) Making a good faith effort to continue to maintain a drug-free
> workplace through
>
> implementation of paragraphs (a) through (f).

B.  The grantee shall 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 and zip
> code):
>
> Signature Date
>
> ![](media/image9.jpeg){width="5.983333333333333in"
> height="7.629166666666666in"}

![](media/image10.jpeg){width="5.983333333333333in"
height="7.761805555555555in"}

![](media/image11.wmf){width="6.908333333333333in"
height="8.934027777777779in"}

![](media/image12.wmf){width="6.908333333333333in"
height="8.934027777777779in"}

APPENDIX 9

CERTIFICATION REGARDING LOBBYING REQUIREMENT

The undersigned (grantee) certifies that 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 officer
>
> or employee of an agency, a Member 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 coopera-
>
> tive agreement, and the extension, continuation, renewal amendment, or
> modification
>
> of any federal contract, grant, loan, 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 a Member of Congress in
    connection with this federal contract, grant, loan, or cooperative
    agreement, the undersigned shall complete and submit Standard
    Form-LLL, "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
    exceeding \$100,000 at all tiers (including subcontracts, subgrants,
    and contracts under grants, loans, and cooperative agreements) and
    that all subrecipients shall certify and disclose accordingly

> 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 31, U.S. Code. Any person who fails to file the required
> certification shall be subject to a civil penalty of not less that
> \$10,000 and not more than \$100,000 for each such failure.

Signature: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
Date: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Grantee Organization:
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Address:
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

City: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_State: \_\_\_\_\_\_\_\_
Zip Code: \_\_\_\_\_\_\_\_