45 CFR Parts 160 & 164 (CFR Annual Edition) ass-through entity in ac- cordance with § 75.503(e). Management decision means the eval- uation by the Federal awarding agency or pass-through entity of the audit findings and corrective action plan and the issuance of a written decision to the auditee as to what corrective ac- tion is necessary. Micro-purchase means a purchase of supplies or services using simplified ac- quisition procedures, the aggregate amount of which does not exceed the micro-purchase threshold. Micro-pur- chase procedures comprise a subset of a non-Federal entity’s small purchase procedures. The non-Federal entity uses such procedures in order to expe- dite the completion of its lowest-dollar small purchase transactions and mini- mize the associated administrative burden and cost. The micro-purchase threshold is set by the Federal Acquisi- tion Regulation at 48 CFR Subpart 2.1 (Definitions). It is $3,000 except as oth- erwise discussed in subpart 2.1 of that regulation, but this threshold is peri- odically adjusted for inflation. Modified Total Direct Cost (MTDC) means all direct salaries and wages, ap- plicable fringe benefits, materials and supplies, services, travel, and up to the first $25,000 of each su ted for inflation. Modified Total Direct Cost (MTDC) means all direct salaries and wages, ap- plicable fringe benefits, materials and supplies, services, travel, and up to the first $25,000 of each subaward (regard- less of the period of performance of the subawards under the award). MTDC ex- cludes equipment, capital expendi- tures, charges for patient care, rental costs, tuition remission, scholarships and fellowships, participant support costs and the portion of each subaward in excess of $25,000. Other items may only be excluded when necessary to avoid a serious inequity in the dis- tribution of indirect costs, and with the approval of the cognizant agency for indirect costs. Non-Federal entity means a state, local government, Indian tribe, institu- tion of higher education (IHE), or non- profit organization that carries out a 245 § 75.2 45 CFR Subtitle A (10–1–24 Edition) Federal award as a recipient or sub- recipient. Nonprofit organization means any cor- poration, trust, association, coopera- tive, or other organization, not includ- ing IHEs, that: (1) Is operated primarily for sci- entific, educational, service, chari- table, or similar purposes in the public interest; (2) tion, coopera- tive, or other organization, not includ- ing IHEs, that: (1) Is operated primarily for sci- entific, educational, service, chari- table, or similar purposes in the public interest; (2) Is not organized primarily for profit; and (3) Uses net proceeds to maintain, improve, or expand the operations of the organization. Obligations, when used in connection with a non-Federal entity’s utilization of funds under a Federal award, obliga- tions means orders placed for property and services, contracts and subawards made, and similar transactions during a given period that require payment by the non-Federal entity during the same or a future period. Office of Management and Budget (OMB) means the Executive Office of the President, Office of Management and Budget. Oversight agency for audit means the Federal awarding agency that provides the predominant amount of funding di- rectly to a non-Federal entity not as- signed a cognizant agency for audit. When there is no direct funding, the Federal awarding agency which is the predominant source of pass-through funding must assume the oversight re- sponsibilities. The duties of the over- sight agency for audit and the process for an the Federal awarding agency which is the predominant source of pass-through funding must assume the oversight re- sponsibilities. The duties of the over- sight agency for audit and the process for any reassignments are described in § 75.513(b). Participant support costs means direct costs for items such as stipends or sub- sistence allowances, travel allowances, and registration fees paid to or on be- half of participants or trainees (but not employees) in connection with con- ferences, or training projects. Pass-through entity means a non-Fed- eral entity that provides a subaward to a subrecipient to carry out part of a Federal program. Performance goal means a target level of performance expressed as a tangible, measurable objective, against which actual achievement can be compared, including a goal expressed as a quan- titative standard, value, or rate. In some instances (e.g., discretionary re- search awards), this may be limited to the requirement to submit technical performance reports (to be evaluated in accordance with agency policy). Period of performance means the time during which the non-Federal entity may incur new obligations to carry out the work authorized under th reports (to be evaluated in accordance with agency policy). Period of performance means the time during which the non-Federal entity may incur new obligations to carry out the work authorized under the Federal award. The Federal awarding agency or pass-through entity must include start and end dates of the period of perform- (see in the Federal award ance §§ 75.210(a)(5) and 75.352(a)(1)(v)). Personal property means property of any kind except real property. It may be tangible, having physical existence, or intangible, such as copyrights, pat- ents, or securities. Personally Information Identifiable (PII) means information that can be used to distinguish or trace an individ- ual’s identity, either alone or when combined with other personal or iden- tifying information that is linked or linkable to a specific individual. Some information that is considered to be PII is available in public sources such as telephone books, public Web sites, and university listings. This type of in- formation is considered to be Public PII and includes, for example, first and last name, address, work telephone number, email address, home telephone number, and general educational cre- dentials. The defi ion is considered to be Public PII and includes, for example, first and last name, address, work telephone number, email address, home telephone number, and general educational cre- dentials. The definition of PII is not anchored to any single category of in- formation or technology. Rather, it re- quires a case-by-case assessment of the specific risk that an individual can be identified. Non-PII can become PII whenever additional information is made publicly available, in any me- dium and from any source, that, when combined with other available infor- mation, could be used to identify an in- dividual. Principal Investigator/Program Director (PI/PD) means the individual (s) des- ignated by the recipient to direct the project or program being supported by the grant. The PI/PD is responsible and accountable to officials of the recipient organization for the proper conduct of the project, program, or activity. Prior approval means written ap- proval by an authorized HHS official evidencing prior consent before a re- cipient undertakes certain activities or incurs specific costs. 246 Dept. of Health and Human Services § 75.2 except as provided Program income means gross income earned ng prior consent before a re- cipient undertakes certain activities or incurs specific costs. 246 Dept. of Health and Human Services § 75.2 except as provided Program income means gross income earned by the non-Federal entity that is directly generated by a supported ac- tivity or earned as a result of the Fed- eral award during the period of per- formance in § 75.307(f). (See Period of performance.) Program income includes but is not limited to income from fees for serv- ices performed, the use or rental or real or personal property acquired under Federal awards, the sale of com- modities or items fabricated under a Federal award, license fees and royal- ties on patents and copyrights, and principal and interest on loans made with Federal award funds. Interest earned on advances of Federal funds is not program income. Except as other- wise provided in Federal statutes, regu- lations, or the terms and conditions of the Federal award, program income does not include rebates, credits, dis- counts, and interest earned on any of them. See also §§ 75.307, 75.407 and 35 U.S.C. 200–212 (applies to inventions made under Federal awards). Project costs means total allowable costs incurred un s- counts, and interest earned on any of them. See also §§ 75.307, 75.407 and 35 U.S.C. 200–212 (applies to inventions made under Federal awards). Project costs means total allowable costs incurred under a Federal award and all required cost sharing and vol- untary committed cost sharing, includ- ing third-party contributions. Project period (see Period of perform- ance). Property means real property or per- sonal property. Protected Personally Identifiable Infor- mation (Protected PII) Protected PII means an individual’s first name or first initial and last name in combina- tion with any one or more of types of information, including, but not limited to, social security number, passport number, credit card numbers, clear- ances, bank numbers, biometrics, date and place of birth, mother’s maiden name, criminal, medical and financial records, educational transcripts. This does not include PII that is required by law to be disclosed. (See also Person- ally Identifiable Information (PII)). Questioned cost means a cost that is questioned by the auditor because of an audit finding: (1) Which resulted from a violation or possible violation of a statute, regula- tion, or the terms and con . Questioned cost means a cost that is questioned by the auditor because of an audit finding: (1) Which resulted from a violation or possible violation of a statute, regula- tion, or the terms and conditions of a Federal award, including for funds used to match Federal funds; (2) Where the costs, at the time of the audit, are not supported by ade- quate documentation; or (3) Where the costs incurred appear unreasonable and do not reflect the ac- tions a prudent person would take in the circumstances. Real property means land, including land improvements, structures and ap- purtenances thereto, but excludes moveable machinery and equipment. Recipient means an entity, usually but not limited to non-Federal entities, that receives a Federal award directly from a Federal awarding agency to carry out an activity under a Federal program. The term recipient does not include subrecipients. See also Non- Federal entity. Research is defined as a systematic study directed toward fuller scientific knowledge or understanding of the sub- ject studied. ‘‘Development’’ is the sys- tematic use of knowledge and under- standing gained from research directed toward the production of useful mate- rials knowledge or understanding of the sub- ject studied. ‘‘Development’’ is the sys- tematic use of knowledge and under- standing gained from research directed toward the production of useful mate- rials, devices, systems, or methods, in- cluding design and development of pro- totypes and processes. Research and Development (R&D) means all research activities, both basic and applied, and all development activities that are performed by HHS award recipients. The term research also includes activities involving the training of individuals in research techniques where such activities utilize the same facilities as other research and development activities and where such activities are not included in the instruction function. Simplified acquisition threshold means the dollar amount below which a non- Federal entity may purchase property or services using small purchase meth- ods. Non-Federal entities adopt small purchase procedures in order to expe- dite the purchase of items costing less than the simplified acquisition thresh- old. The simplified acquisition thresh- old is set by the Federal Acquisition Regulation at 48 CFR subpart 2.1 and in accordance with 41 U.S.C. 1908. As of the pu an the simplified acquisition thresh- old. The simplified acquisition thresh- old is set by the Federal Acquisition Regulation at 48 CFR subpart 2.1 and in accordance with 41 U.S.C. 1908. As of the publication of this part, the sim- plified acquisition threshold is $150,000, but this threshold is periodically ad- justed for inflation. See also Micro- purchase. 247 § 75.2 45 CFR Subtitle A (10–1–24 Edition) Special purpose equipment means equipment which is used only for re- search, medical, scientific, or other technical activities. Examples of spe- cial purpose equipment include micro- scopes, x-ray machines, surgical instru- ments, and spectrometers. See also Equipment and General purpose equip- ment. State means any state of the United States, the District of Columbia, the Commonwealth of Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, the Commonwealth of the Northern Mariana Islands, and any agency or instrumentality thereof ex- clusive of local governments. Student Financial Aid (SFA) means Federal awards under those programs of general student assistance, such as those authorized by Title IV of the Higher Education Act of 1965, as amended, (20 U.S.C. 1070–1099d), ancial Aid (SFA) means Federal awards under those programs of general student assistance, such as those authorized by Title IV of the Higher Education Act of 1965, as amended, (20 U.S.C. 1070–1099d), which are administered by the U.S. Depart- ment of Education, and similar pro- grams provided by other Federal agen- cies. It does not include Federal awards under programs that provide fellow- ships or similar Federal awards to stu- dents on a competitive basis, or for specified studies or research. Subaward means an award provided by a pass-through entity to a sub- recipient for the subrecipient to carry out part of a Federal award received by the pass-through entity. It does not in- clude payments to a contractor or pay- ments to an individual that is a bene- ficiary of a Federal program. A subaward may be provided through any form of legal agreement, including an agreement that the pass-through enti- ty considers a contract. Subrecipient means a non-Federal en- tity that receives a subaward from a pass-through entity to carry out part of a Federal program; but does not in- clude an individual that is a bene- ficiary of such program. A subrecipient may also be a recipient of other F award from a pass-through entity to carry out part of a Federal program; but does not in- clude an individual that is a bene- ficiary of such program. A subrecipient may also be a recipient of other Fed- eral awards directly from a Federal awarding agency. Supplies means all tangible personal property other than those described in Equipment. A computing device is a supply if the acquisition cost is less than the lesser of the capitalization level established by the non-Federal entity for financial statement purposes or $5,000, regardless of the length of its useful life. See also Computing devices and Equipment. Surplus property (see Excess property) Suspension of award activities means an action by the HHS awarding agency requiring the recipient to cease all ac- tivities on the award pending correc- tive action by the recipient. It is a sep- arate action from suspension under HHS regulations (2 CFR part 376) im- plementing Executive Orders 12549 and 12689. Termination means the ending of a Federal award, in whole or in part at any time prior to the planned end of period of performance. Third-party contributions in-kind means the value of non-cash contribu- tions (i.e., property or of a Federal award, in whole or in part at any time prior to the planned end of period of performance. Third-party contributions in-kind means the value of non-cash contribu- tions (i.e., property or services) that: (1) Benefit a federally assisted project or program; and (2) Are contributed by non-Federal third parties, without charge, to a non- Federal entity under a Federal award. Total Costs (see § 75.402). Unliquidated obligations means, for fi- nancial reports prepared on a cash basis, obligations incurred by the non- Federal entity that have not been paid (liquidated). For reports prepared on an accrual expenditure basis, these are ob- ligations incurred by the non-Federal entity for which an expenditure has not been recorded. Unobligated balance means the amount of funds authorized under a Federal award that the non-Federal en- tity has not obligated. The amount is computed by subtracting the cumu- lative amount of the non-Federal enti- ty’s unliquidated obligations and ex- penditures of funds under the Federal award from the cumulative amount of the funds that the Federal awarding agency or pass-through entity author- ized the non-Federal entity to obligate. sharing commi nditures of funds under the Federal award from the cumulative amount of the funds that the Federal awarding agency or pass-through entity author- ized the non-Federal entity to obligate. sharing committed means cost sharing specifically pledged on a voluntary basis in the proposal’s budget or the Federal award on the part of the non-Federal entity and that becomes a binding requirement of Fed- eral award. Voluntary cost Working capital advance means a pro- cedure whereby funds are advanced to the recipient to cover its estimated 248 Dept. of Health and Human Services § 75.101 disbursement needs for a given initial period. [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3012, Jan. 20, 2016; 81 FR 19044, Apr. 4, 2016] Subpart B—General Provisions § 75.100 Purpose. requirements, (a)(1) This part establishes uniform administrative cost principles, and audit requirements for Federal awards to non-Federal entities, as described in § 75.101. HHS awarding agencies must not impose additional or inconsistent requirements, except as provided in §§ 75.102 and 75.210, or unless specifically required by Federal stat- ute, regulation, or Executive Order. (2) This part provides the basis for a sy r inconsistent requirements, except as provided in §§ 75.102 and 75.210, or unless specifically required by Federal stat- ute, regulation, or Executive Order. (2) This part provides the basis for a systematic and periodic collection and uniform submission by Federal agen- cies of information on all Federal fi- nancial assistance programs to the Of- fice of Management and Budget (OMB). It also establishes Federal policies re- lated to the delivery of this informa- tion to the public, including through the use of electronic media. It pre- scribes the manner in which General Services Administration (GSA), OMB, and Federal agencies that administer Federal financial assistance programs are to carry out their statutory respon- sibilities under the Federal Program Information Act (31 U.S.C. 6101–6106). (b) Administrative requirements. Sub- parts B through D of this part set forth the uniform administrative require- ments for grant and cooperative agree- ments, including the requirements for HHS awarding agency management of Federal grant programs before the Fed- eral award has been made, and the re- quirements HHS awarding agencies may impose on non-Federal entities in the Federal award. HS awarding agency management of Federal grant programs before the Fed- eral award has been made, and the re- quirements HHS awarding agencies may impose on non-Federal entities in the Federal award. (c) Cost principles. Subpart E of this part establishes principles for deter- mining the allowable costs incurred by non-Federal entities under Federal awards. The principles are for the pur- pose of cost determination and are not intended to identify the circumstances or dictate the extent of Federal Gov- ernment participation in the financing of a particular program or project. The principles are designed to provide that Federal awards bear their fair share of cost recognized under these principles except where restricted or prohibited by statute. (d) Single audit requirements and audit follow-up. Subpart F of this part is issued pursuant to the Single Audit Act Amendments of 1996, (31 U.S.C. 7501–7507). It sets forth standards for obtaining consistency and uniformity among Federal agencies for the audit of non-Federal entities expending Fed- eral awards. These provisions also pro- vide the policies and procedures for HHS awarding agencies and pass- through entities when using the re ies for the audit of non-Federal entities expending Fed- eral awards. These provisions also pro- vide the policies and procedures for HHS awarding agencies and pass- through entities when using the results of these audits. (e) For OMB guidance to Federal awarding agencies on Challenges and Prizes, please see M–10–11 Guidance on the Use of Challenges and Prizes to Promote Open Government, issued March 8, 2010, or its successor. § 75.101 Applicability. (a) General applicability to Federal agencies. The requirements established in this part apply to Federal agencies that make Federal awards to non-Fed- eral entities. These requirements are applicable to all costs related to Fed- eral awards. (b)(1) Applicability to different types of Federal awards. The following table de- scribes what portions of this part apply to which types of Federal awards. The terms and conditions of Federal-awards (including this part) flow down to sub- awards to subrecipients unless a par- ticular section of this part or the terms and conditions of the Federal award specifically indicate otherwise. This means that non-Federal entities must comply with requirements in this part regardless of whether the non-Fe part or the terms and conditions of the Federal award specifically indicate otherwise. This means that non-Federal entities must comply with requirements in this part regardless of whether the non-Federal entity is a recipient or subrecipient of a Federal award. Pass-through entities must comply with the requirements de- scribed in subpart D of this part, §§ 75.351 through 75.353, but not any re- quirements in this part directed to- wards Federal awarding agencies un- less the requirements of this part or the terms and conditions of the Federal award indicate otherwise. This table must be read along with the other pro- visions in this section 249 § 75.101 45 CFR Subtitle A (10–1–24 Edition) The following portions of the part: Are applicable to the fol- lowing types of Federal awards and fixed-price contracts and sub- contracts (except as noted in paragraphs (d) and (e) below): Are NOT applicable to the following types of Federal awards and fixed-price contracts and subcontracts: This table must be read along with the other provisions in this section Subpart A—Acronyms and Definitions ................... —All. —All. Subpart B—General Provisions, except for §§ 75.111, 75.112. and 75 table must be read along with the other provisions in this section Subpart A—Acronyms and Definitions ................... —All. —All. Subpart B—General Provisions, except for §§ 75.111, 75.112. and 75.113. Sections 75.111, 75.112, and 75.113 .................... —Grant agreements —Agreements for loans, loan guarantees, inter- est subsidies and insurance. —Procurement contracts awarded by Federal Agencies under the Federal Acquisition Regu- lations and subcontracts under these con- tracts. —Agreements for loans, loan guarantees, inter- est subsidies and insurance. —Procurement contracts awarded under the Federal Acquisition Regulations and cost-reim- bursement and subcontracts under these con- tracts. —Procurement contracts awarded under the Federal Acquisition Regulations and cost-reim- bursement and subcontracts under these con- tracts. —Grant agreements and cooperative agree- ments providing food commodities. —Fixed amount awards. —Agreements for loans, loan guarantees, inter- est subsidies and insurance. —Federal awards to hospitals (See Appendix IX). —Fixed-price contracts and subcontracts award- ed under the Federal Acquisition Regulation. and cooperative agreements. Subparts bsidies and insurance. —Federal awards to hospitals (See Appendix IX). —Fixed-price contracts and subcontracts award- ed under the Federal Acquisition Regulation. and cooperative agreements. Subparts C–D, except for §§ 75.202, 75.303, 75.351–.353. —Grant agreements and cooperative agreements. § 75.202 .................................................................. —Grant Agreements and cooperative agreements. —Agreements for loans, loan guarantees, in- terest subsidies and insurance. §§ 75.303, 75.351–.353 .......................................... —All. Subpart E—Cost Principles .................................... —Grant agreements and cooperative agreements, except those providing food commodities. —All procurement con- tracts under the Fed- eral Acquisition Regu- lations except those that are not nego- tiated. Subpart F—Audit Requirements ............................ —Grant agreements and cooperative agreements. —Contracts and sub- contracts, except for fixed price contract and subcontracts, awarded under the Federal Acquisition Regulation. —Agreements for loans, loan guarantees, in- terest subsidies and insurance and other forms of Federal Fi- nancial Assistance as defined subcontracts, awarded under the Federal Acquisition Regulation. —Agreements for loans, loan guarantees, in- terest subsidies and insurance and other forms of Federal Fi- nancial Assistance as defined by the Single Audit Act Amendment of 1996. (2) Federal award of cost-reimbursement contract under the FAR to a non-Federal entity. When a non-Federal entity is awarded a cost-reimbursement con- tract, only subpart D of this part §§ 75.351 through 75.353 (in addition to any FAR related requirements for subaward monitoring), subpart E of this part and subpart F of this part are incorporated by reference into the con- tract. However, when the Cost Ac- counting Standards (CAS) are applica- ble to the contract, they take prece- dence over the requirements of this part except for subpart F of this part when they are in conflict. In addition, 250 Dept. of Health and Human Services § 75.101 costs that are made unallowable under 10 U.S.C. 2324(e) and 41 U.S.C. 4304(a) as described in the FAR subpart 31.2 and subpart 31.603 are always unallowable. For requirements other than those cov- ered in subpart D of this part, §§ 75.351 through 75.353, subpart E of this part and subpart F of this part, th t 31.2 and subpart 31.603 are always unallowable. For requirements other than those cov- ered in subpart D of this part, §§ 75.351 through 75.353, subpart E of this part and subpart F of this part, the terms of the contract and the FAR apply. (3) With the exception of subpart F of this part, which is required by the Sin- gle Audit Act, in any circumstances where the provisions of Federal stat- utes or regulations differ from the pro- visions of this part, the provision of the Federal statutes or regulations govern. This includes, for agreements with Indian tribes, the provisions of the Indian Self-Determination and Education Act (ISDEAA), as amended, 25 U.S.C. 450– 458ddd–2. Assistance and (c) HHS awarding agencies may apply subparts A through E of this part to Federal agencies (see § 75.217), for-profit entities, foreign public entities, or for- eign organizations, except where the HHS awarding agency determines that the application of these subparts would be inconsistent with the international obligations of the United States or the statutes or regulations of a foreign government. (d) Except for §§ 75.202 and 75.351 through 75.353 of subpart D of this part, the requirements in su ernational obligations of the United States or the statutes or regulations of a foreign government. (d) Except for §§ 75.202 and 75.351 through 75.353 of subpart D of this part, the requirements in subpart C of this part, subpart D of this part, and sub- part E of this part do not apply to the following programs: (1) The block grant awards author- ized by the Omnibus Budget Reconcili- ation Act of 1981 (including Community Services), except to the extent that subpart E of this part apply to sub- recipients of Community Services Block Grant funds pursuant to 42 U.S.C. 9916(a)(1)(B); (2) Federal awards to local education agencies under 20 U.S.C. 7702–7703b, (portions of the Impact Aid program); (3) Payments under the Department of Veterans Affairs’ State Home Per Diem Program (38 U.S.C. 1741); and (4) Federal awards authorized under the Child Care and Development Block Grant Act of 1990, as amended: (ii) Child Care Mandatory and Match- ing Funds of the Child Care and Devel- opment Fund (42 U.S.C. 9858) (e) Except for § 75.202, the guidance in subpart C of this part does not apply to the following programs: (1) Entitlement Federal awards to carry out the following programs of the Soci 42 U.S.C. 9858) (e) Except for § 75.202, the guidance in subpart C of this part does not apply to the following programs: (1) Entitlement Federal awards to carry out the following programs of the Social Security Act: (i) Temporary Assistance for Needy Families (title IV–A of the Social Secu- rity Act, 42 U.S.C. 601–619); (ii) Child Support Enforcement and Establishment of Paternity (title IV–D of the Social Security Act, 42 U.S.C. 651–669b); (iii) Foster Care and Adoption Assist- ance (title IV–E of the Act, 42 U.S.C. 670–679c); (iv) Aid to the Aged, Blind, and Dis- abled (titles I, X, XIV, and XVI–AABD of the Act, as amended); (v) Medical Assistance (Medicaid) (title XIX of the Act, 42 U.S.C. 1396– 1396w–5) not including the State Med- icaid Fraud Control program author- ized by § 1903(a)(6)(B) of the Social Se- curity Act (42 U.S.C. 1396b(a)(6)(B)); and (vi) Children’s Health Insurance Pro- gram (title XXI of the Act, 42 U.S.C. 1397aa–1397mm). (2) A Federal award for an experi- mental, pilot, or demonstration project that is also supported by a Federal award listed in paragraph (e)(1) of this section; (3) Federal awards under subsection 412(e) of the Immigration and Nation- ality l, pilot, or demonstration project that is also supported by a Federal award listed in paragraph (e)(1) of this section; (3) Federal awards under subsection 412(e) of the Immigration and Nation- ality Act and subsection 501(a) of the Refugee Education Assistance Act of 1980 (Pub. L. 96–422, 94 Stat. 1809), for cash assistance, medical assistance, and supplemental security income ben- efits to refugees and entrants and the administrative costs of providing the assistance and benefits (8 U.S.C. 1522(e)); (4) Entitlement awards under the fol- lowing programs of The National School Lunch Act: (i) National School Lunch Program (section 4 of the Act, 42 U.S.C. 1753), (ii) Commodity Assistance (section 6 of the Act, 42 U.S.C. 1755), (i) Child Care and Development Block (iii) Special Meal Assistance (section Grant (42 U.S.C. 9858) 11 of the Act, 42 U.S.C. 1759a), 251 § 75.102 45 CFR Subtitle A (10–1–24 Edition) (iv) Summer Food Service Program for Children (section 13 of the Act, 42 U.S.C. 1761), and (v) Child and Adult Care Food Pro- gram (section 17 of the Act, 42 U.S.C. 1766). (5) Entitlement awards under the fol- lowing programs of The Child Nutri- tion Act of 1966: (i) Special Milk Pr 1), and (v) Child and Adult Care Food Pro- gram (section 17 of the Act, 42 U.S.C. 1766). (5) Entitlement awards under the fol- lowing programs of The Child Nutri- tion Act of 1966: (i) Special Milk Program (section 3 of the Act, 42 U.S.C. 1772), (ii) School Breakfast Program (sec- tion 4 of the Act, 42 U.S.C. 1773), and (iii) State Administrative Expenses (section 7 of the Act, 42 U.S.C. 1776). (6) Entitlement awards for State Ad- ministrative Expenses under The Food and Nutrition Act of 2008 (section 16 of the Act, 7 U.S.C. 2025). (7) Non-discretionary Federal awards under the following non-entitlement programs: (i) Special Supplemental Nutrition Program for Women, Infants and Chil- dren (section 17 of the Child Nutrition Act of 1966) 42 U.S.C. 1786; (ii) The Emergency Food Assistance Programs (Emergency Food Assistance Act of 1983) 7 U.S.C. 7501 note; and (iii) Commodity Supplemental Food Program (section 5 of the Agriculture and Consumer Protection Act of 1973) 7 U.S.C. 612c note. [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3013, Jan. 20, 2016; 81 FR 89395, Dec. 12, 2016; 86 FR 2278, Jan. 12, 2021] § 75.102 Exceptions. (a) With the exception of subpart F of this part, OMB m 79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3013, Jan. 20, 2016; 81 FR 89395, Dec. 12, 2016; 86 FR 2278, Jan. 12, 2021] § 75.102 Exceptions. (a) With the exception of subpart F of this part, OMB may allow exceptions for classes of Federal awards or non- Federal entities subject to the require- ments of this part when exceptions are not prohibited by statute. However, in the interest of maximum uniformity, exceptions from the requirements of this part will be permitted only in un- usual circumstances. Exceptions for classes of Federal awards or non-Fed- eral entities will be published on the OMB Web site at www.whitehouse.gov/ omb. (b) Exceptions on a case-by-case basis for individual non-Federal entities may be authorized by the HHS awarding agency or cognizant agency for indirect costs, except where otherwise required by law or where OMB or other approval is expressly required by this part. (c) The HHS awarding agency may apply more restrictive requirements to a class of Federal awards or non-Fed- eral entities when approved by OMB, or when required by Federal statutes or regulations, except for the require- ments in subpart F of this part. An HHS awarding agency may apply les wards or non-Fed- eral entities when approved by OMB, or when required by Federal statutes or regulations, except for the require- ments in subpart F of this part. An HHS awarding agency may apply less restrictive requirements when making fixed amount awards as defined in sub- part A of this part, except for those re- quirements imposed by statute or in subpart F of this part. (d) On a case-by-case basis, OMB will approve new strategies for Federal awards when proposed by the HHS awarding agency in accordance with OMB guidance (such as M–13–17) to de- velop additional evidence relevant to addressing important policy challenges or to promote cost-effectiveness in and across Federal programs. Proposals may draw on the innovative program designs discussed in M–13–17 to expand or improve the use of effective prac- tices in delivering Federal financial as- sistance while also encouraging inno- vation in service delivery. Proposals submitted to OMB in accordance with M–13–17 may include requests to waive requirements other than those in sub- part F of this part. [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3014, Jan. 20, 2016] § 75.103 Authorities. This part is issued under the fol- ests to waive requirements other than those in sub- part F of this part. [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3014, Jan. 20, 2016] § 75.103 Authorities. This part is issued under the fol- lowing authorities. (a) Subpart B of this part through subpart D of this part are authorized under 31 U.S.C. 503 (the Chief Financial Officers Act, Functions of the Deputy Director for Management), 31 U.S.C. 1111 (Improving Economy and Effi- ciency of the United States Govern- ment), 41 U.S.C. 1101–1131 (the Office of Federal Procurement Policy Act), Re- organization Plan No. 2 of 1970, and Ex- ecutive Order 11541 Prescribing the Du- ties of the Office of Management and Budget and the Domestic Policy Coun- cil in the Executive Office of the Presi- dent, the Single Audit Act Amend- ments of 1996, (31 U.S.C. 7501–7507), as well as The Federal Program Informa- tion Act (Public Law 95–220 and Public Law 98–169, as amended, codified at 31 U.S.C. 6101–6106). 252 Dept. of Health and Human Services § 75.110 (b) Subpart E of this part is author- ized under the Budget and Accounting Act of 1921, as amended; the Budget and Accounting Procedures Act of 1950, as amended (31 U.S.C. 1101–1125); the C s § 75.110 (b) Subpart E of this part is author- ized under the Budget and Accounting Act of 1921, as amended; the Budget and Accounting Procedures Act of 1950, as amended (31 U.S.C. 1101–1125); the Chief Financial Officers Act of 1990 (31 U.S.C. 503–504); Reorganization Plan No. 2 of 1970; and Executive Order No. 11541 Prescribing the Duties of the Of- fice of Management and Budget and the Domestic Policy Council in the Execu- tive Office of the President. (c) Subpart F of this part is author- ized under the Single Audit Act Amendments of 1996, (31 U.S.C. 7501– 7507). [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3014, Jan. 20, 2016] § 75.104 Supersession. As described in § 75.110, this part su- persedes: (a) The following OMB guidance doc- uments and regulations under Title 2 of the Code of Federal Regulations: (1) A–21, ‘‘Cost Principles for Edu- cational Institutions’’ (2 CFR part 220); (2) A–87, ‘‘Cost Principles for State, Local and Indian Tribal Governments’’ (2 CFR part 225) and also FEDERAL REG- ISTER notice 51 FR 552 (January 6, 1986); (3) A–89, ‘‘Federal Domestic Assist- ance Program Information’’; (4) A–102, ‘‘Grant Awards and Cooper- ative Agreements with State and and also FEDERAL REG- ISTER notice 51 FR 552 (January 6, 1986); (3) A–89, ‘‘Federal Domestic Assist- ance Program Information’’; (4) A–102, ‘‘Grant Awards and Cooper- ative Agreements with State and Local Governments’’; (5) A–110, ‘‘Uniform Administrative Requirements for Awards and Other Agreements with Institutions of Higher Education, Hospitals, and Other Non- profit Organizations’’ (codified at 2 CFR 215); (6) A–122, ‘‘Cost Principles for Non- Profit Organizations’’ (2 CFR part 230); (7) A–133, ‘‘Audits of States, Local Governments and Non-Profit Organiza- tions’’, and (8) Those sections of A–50 related to audits performed under subpart F of this part. (b) This part also supersedes HHS’ regulations at 45 CFR parts 74 and 92. [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3014, Jan. 20, 2016] § 75.105 Effect on other issuances. For Federal awards subject to this part, all administrative requirements, program manuals, handbooks and other non-regulatory materials that are in- consistent with the requirements of this part are superseded upon imple- mentation of this part by the HHS awarding agency, except to the extent they are required by statute or author- ized in accordance w stent with the requirements of this part are superseded upon imple- mentation of this part by the HHS awarding agency, except to the extent they are required by statute or author- ized in accordance with the provisions in § 75.102. § 75.106 Agency implementation. HHS is implementing the language in 2 CFR part 200 in these codified regula- tions. § 75.107 OMB responsibilities. OMB will review HHS agency regula- tions and implementation of 2 CFR part 200, and will provide interpreta- tions of policy requirements and assist- ance to ensure effective and efficient implementation. Any exceptions will be subject to approval by OMB. Excep- tions will only be made in particular cases where adequate justification is presented. § 75.108 Inquiries. Inquiries concerning 2 CFR part 200 may be directed to the Office of Fed- eral Financial Management, Office of Management and Budget, in Wash- ington, DC. Inquiries concerning 45 CFR part 75 should be addressed to the HHS awarding agency, cognizant agen- cy for indirect costs, cognizant or over- sight agency for audit, or pass-through entity as appropriate. § 75.109 Review date. OMB will review 2 CFR part 200 and HHS will review 45 part 75 at least n- cy for indirect costs, cognizant or over- sight agency for audit, or pass-through entity as appropriate. § 75.109 Review date. OMB will review 2 CFR part 200 and HHS will review 45 part 75 at least every five years after December 26, 2013. § 75.110 Effective/Applicability date. (a) The standards set forth in this part which affect administration of Federal awards issued by HHS agencies become effective December 26, 2014 un- less different provisions are required by statute or approved by OMB. For the procurement standards in 45 CFR 75.326 through 75.335, non-Federal entities may continue to comply with the pro- curement standards in previous OMB guidance (superseded by this part as described in 45 CFR 75.104) for two addi- tional fiscal years after this part goes 253 § 75.111 45 CFR Subtitle A (10–1–24 Edition) into effect. If a non-Federal entity chooses to use the previous procure- ment standards for an additional two fiscal years before adopting the pro- curement standards in this part, the non-Federal entity must document this decision in their internal procurement policies. (b) The standards set forth in subpart F of this part and any other standards which apply directly to s part, the non-Federal entity must document this decision in their internal procurement policies. (b) The standards set forth in subpart F of this part and any other standards which apply directly to HHS agencies will be effective December 26, 2013, and will apply to audits of fiscal years be- ginning on or after December 26, 2014. [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3014, Jan. 20, 2016; 81 FR 89395, Dec. 12, 2016] § 75.111 English language. (a) All Federal financial assistance announcements and Federal award in- formation must be in the English lan- guage. Applications must be submitted in the English language and must be in the terms of U.S. dollars. If the HHS awarding agency receives applications in another currency, the HHS awarding agency will evaluate the application by converting the foreign currency to United States currency using the date specified for receipt of the application. (b) Non-Federal entities may trans- late the Federal award and other docu- ments into another language. In the event of inconsistency between any terms and conditions of the Federal award and any translation into another language, the English language mean- ing will control. Where a to another language. In the event of inconsistency between any terms and conditions of the Federal award and any translation into another language, the English language mean- ing will control. Where a significant portion of the non-Federal entity’s em- ployees who are working on the Fed- eral award are not fluent in English, the non-Federal entity must provide the Federal award in English and the language(s) with which employees are more familiar. § 75.112 Conflict of interest. (a) HHS awarding agencies must es- tablish conflict of interest policies for Federal awards. The non-Federal enti- ty must disclose in writing any poten- tial conflict of interest to the respec- tive HHS awarding agency or pass- through entity in accordance with ap- plicable HHS awarding agency’s policy. As a general matter, HHS awarding agencies’ conflict of interest policies must: (1) Address conditions under which outside activities, relationships, or fi- nancial interests are proper or im- proper; (2) Provide for advance notification of outside activities, relationships, or financial interests, and a process of re- view as appropriate; and (3) Outline how financial conflicts of interest may be addressed. e for advance notification of outside activities, relationships, or financial interests, and a process of re- view as appropriate; and (3) Outline how financial conflicts of interest may be addressed. (b) Agencies with Public Health Serv- ice (PHS) funded research will ensure that any conflict of interest policies are aligned with the requirements of 42 CFR part 50, subpart F. § 75.113 Mandatory disclosures. The non-Federal entity or applicant for a Federal award must disclose, in a timely manner, in writing to the HHS awarding agency or pass-through enti- ty all violations of Federal criminal law involving fraud, bribery, or gra- tuity violations potentially affecting the Federal award. Non-Federal enti- ties that have received a Federal award including the term and condition out- lined in Appendix XII are required to report certain civil, criminal, or ad- ministrative proceedings to SAM. Fail- ure to make required disclosures can result in any of the remedies described in § 75.371, including suspension or de- barment. (See also 2 CFR parts 180 and 376, and 31 U.S.C. 3321). [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3014, Jan. 20, 2016] Subpart C—Pre-Federal Award Requiremen ncluding suspension or de- barment. (See also 2 CFR parts 180 and 376, and 31 U.S.C. 3321). [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3014, Jan. 20, 2016] Subpart C—Pre-Federal Award Requirements and Contents of Federal Awards § 75.200 Purpose. (a) Sections 75.201 through 75.208 pre- scribe instructions and other pre-award matters to be used in the announce- ment and application process. (b) Use of §§ 75.203, 75.204, 75.205, and 75.207, is required only for competitive Federal awards, but may also be used by the HHS awarding agency for non- competitive awards where appropriate or where required by Federal statute. 254 Dept. of Health and Human Services § 75.202 § 75.201 Use of grant agreements (in- cluding fixed amount awards), co- operative agreements, and con- tracts. (a) The HHS awarding agency or pass-through entity must decide on the appropriate instrument for the Federal award (i.e., grant agreement, coopera- tive agreement, or contract) in accord- ance with the Federal Grant and Coop- erative Agreement Act (31 U.S.C. 6301– 08). (b) Fixed Amount Awards. In addi- tion to the options described in para- graph (a) of this section, HHS awarding agencies, or pass-through ent ant and Coop- erative Agreement Act (31 U.S.C. 6301– 08). (b) Fixed Amount Awards. In addi- tion to the options described in para- graph (a) of this section, HHS awarding agencies, or pass-through entities as permitted in § 75.353, may use fixed amount awards (see § 75.2 Fixed amount awards) to which the following condi- tions apply: (1) The Federal award amount is ne- gotiated using the cost principles (or other pricing information) as a guide. The HHS awarding agency or pass- through entity may use fixed amount awards if the project scope is specific and if adequate cost, historical, or unit pricing data is available to establish a fixed amount award based on a reason- able estimate of actual cost. Payments are based on meeting specific require- ments of the Federal award. Account- ability is based on performance and re- sults. Except in the case of termination before completion of the Federal award, there is no governmental review of the actual costs incurred by the non- Federal entity in performance of the award. Some of the ways in which the Federal award may be paid include, but are not limited to: (i) In several partial payments, the amount of each agreed upon in ad- vance, ity in performance of the award. Some of the ways in which the Federal award may be paid include, but are not limited to: (i) In several partial payments, the amount of each agreed upon in ad- vance, and the ‘‘milestone’’ or event triggering the payment also agreed upon in advance, and set forth in the Federal award; (ii) On a unit price basis, for a de- fined unit or units, at a defined price or prices, agreed to in advance of perform- ance of the Federal award and set forth in the Federal award; or, (iii) In one payment at Federal award completion. (2) A fixed amount award cannot be used in programs which require manda- tory cost sharing or match. (3) The non-Federal entity must cer- tify in writing to the HHS awarding agency or pass-through entity at the end of the Federal award that the project or activity was completed or the level of effort was expended. If the required level of activity or effort was not carried out, the amount of the Fed- eral award must be adjusted. (4) Periodic reports may be estab- lished for each Federal award. (5) Changes in principal investigator, project leader, project partner, or scope of effort must receive the prior written approval of the HHS aw ic reports may be estab- lished for each Federal award. (5) Changes in principal investigator, project leader, project partner, or scope of effort must receive the prior written approval of the HHS awarding agency or pass-through entity. § 75.202 Requirement to provide public notice of Federal financial assist- ance programs. (a) The HHS awarding agency must notify the public of Federal programs in the Catalog of Federal Domestic As- sistance (CFDA), maintained by the Administration General (GSA). Services (1) The CFDA, or any OMB-des- ignated replacement, is the single, au- thoritative, government-wide com- prehensive source of Federal financial assistance program information pro- duced by the executive branch of the Federal Government. (2) The information that the HHS awarding agency must submit to GSA for approval by OMB is listed in para- graph (b) of this section. GSA must prescribe the format for the submis- sion. (3) The HHS awarding agency may not award Federal financial assistance without assigning it to a program that has been included in the CFDA as re- quired in this section unless there are exigent circumstances requiring other- wise, such as timing requirements im- po ance without assigning it to a program that has been included in the CFDA as re- quired in this section unless there are exigent circumstances requiring other- wise, such as timing requirements im- posed by statute. (b) For each program that awards discretionary Federal awards, non-dis- cretionary Federal awards, loans, in- surance, or any other type of Federal financial assistance, the HHS awarding agency must submit the following in- formation to GSA: (1) Program Description, Purpose, Goals and Measurement. A brief sum- mary of the statutory or regulatory re- quirements of the program and its in- tended outcome. Where appropriate, the Program Description, Purpose, Goals, and Measurement should align 255 § 75.203 45 CFR Subtitle A (10–1–24 Edition) with the strategic goals and objectives within the HHS awarding agency’s per- formance plan and should support the HHS awarding agency’s performance measurement, management, and re- porting as required by Part 6 of OMB Circular A–11; (2) Identification of whether the pro- gram makes Federal awards on a dis- cretionary basis or the Federal awards are prescribed by Federal statute, such as in the case of formula grants. (3) Projected tota entification of whether the pro- gram makes Federal awards on a dis- cretionary basis or the Federal awards are prescribed by Federal statute, such as in the case of formula grants. (3) Projected total amount of funds available for the program. Estimates based on previous year funding are ac- ceptable if current appropriations are not available at the time of the sub- mission; (4) Anticipated Source of Available Funds: The statutory authority for funding the program and, to the extent possible, agency, sub-agency, or, if known, the specific program unit that will issue the Federal awards, and asso- ciated funding identifier (e.g., Treasury Account Symbol(s)); (5) General Eligibility Requirements: The statutory, regulatory or other eli- gibility factors or considerations that determine the applicant’s qualification for Federal awards under the program (e.g., type of non-Federal entity); and (6) Applicability of Single Audit Re- quirements as required by subpart F of this part. § 75.203 Notices of funding opportuni- ties. For competitive grants and coopera- tive agreements, the HHS awarding agency must announce specific funding opportunities by providing the fol- lowing information i Notices of funding opportuni- ties. For competitive grants and coopera- tive agreements, the HHS awarding agency must announce specific funding opportunities by providing the fol- lowing information in a public notice: (a) Summary Information in Notices of Funding Opportunities. The HHS award- ing agency must display the following information posted on the OMB-des- ignated government-wide Web site for finding and applying for Federal finan- cial assistance, in a location preceding the full text of the announcement: (1) HHS Awarding Agency Name; (2) Funding Opportunity Title; (3) Announcement Type (whether the funding opportunity is the initial an- nouncement of this funding oppor- tunity or a modification of a pre- viously announced opportunity); (4) Funding Opportunity Number (re- quired, if applicable). If the HHS awarding agency has assigned or will assign a number to the funding oppor- tunity announcement, this number must be provided; (5) Catalog of Federal Domestic As- sistance (CFDA) Number(s); (6) Key Dates. Key dates include due dates for applications or Executive Order 12372 submissions, as well as for any letters of intent or pre-applica- tions. For any announcement issu CFDA) Number(s); (6) Key Dates. Key dates include due dates for applications or Executive Order 12372 submissions, as well as for any letters of intent or pre-applica- tions. For any announcement issued before a program’s application mate- rials are available, key dates also in- clude the date on which those mate- rials will be released; and any other ad- ditional information, as deemed appli- cable by the relevant HHS awarding agency. (b) The HHS awarding agency must generally make all funding opportuni- ties available for application for at least 60 calendar days. The HHS award- ing agency may make a determination to have a less than 60 calendar day availability period but no funding op- portunity should be available for less than 30 calendar days unless exigent circumstances require as determined by the HHS awarding agency head or delegate. (c) Full Text of Funding Opportunities. The HHS awarding agency must in- clude the following information in the full text of each funding opportunity. For specific instructions on the con- tent required in this section, refer to appendix I of this part. (1) Full programmatic description of the funding opportunity. (2) Federal award informatio unity. For specific instructions on the con- tent required in this section, refer to appendix I of this part. (1) Full programmatic description of the funding opportunity. (2) Federal award information, in- cluding sufficient information to help an applicant make an informed deci- sion about whether to submit an appli- cation. (See also § 75.414(c)(4)). (3) Specific eligibility information, including any factors or priorities that affect an applicant’s or its applica- tion’s eligibility for selection. (4) Application Preparation and Sub- mission Information, including the ap- plicable submission dates and time. (5) Application Review Information including the criteria and process to be used to evaluate applications. See also §§ 75.204 and 75.205. 256 Dept. of Health and Human Services § 75.205 (6) Federal Award Administration In- formation. See also § 75.210. [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3014, Jan. 20, 2016] § 75.204 HHS funding agency review of merit of proposals. For competitive grants or coopera- tive agreements, unless prohibited by Federal statute, the HHS awarding agency must design and execute a merit review process for applications. This process must be For competitive grants or coopera- tive agreements, unless prohibited by Federal statute, the HHS awarding agency must design and execute a merit review process for applications. This process must be described or in- corporated by reference in the applica- ble funding opportunity (see appendix I to this part.) See also § 75.203. § 75.205 HHS awarding agency review of risk posed by applicants. (a) Review of OMB-designated reposi- tories of governmentwide data. (1) Prior to making a Federal award, the HHS awarding agency is required by 31 U.S.C. 3321 and 41 U.S.C. 2313 note to review information available through any OMB-designated repositories of governmentwide eligibility qualifica- tion or financial integrity information as appropriate. See also suspension and debarment requirements at 2 CFR parts 180 and 376. (2) In accordance 41 U.S.C. 2313, the HHS awarding agency is required to re- view the non-public segment of the OMB-designated integrity and perform- ance system accessible through SAM (currently the Federal Awardee Per- formance and Integrity Information System (FAPIIS)) prior to making a Federal award where the Federal share is expected to exceed the simplified ac- quisiti ugh SAM (currently the Federal Awardee Per- formance and Integrity Information System (FAPIIS)) prior to making a Federal award where the Federal share is expected to exceed the simplified ac- quisition threshold, defined in 41 U.S.C. 134, over the period of performance. At a minimum, the information in the system for a prior Federal award re- cipient must demonstrate a satisfac- tory record of executing programs or activities under Federal grants, coop- erative agreements, or procurement awards; and integrity and business eth- ics. The HHS awarding agency may make a Federal award to a recipient who does not fully meet these stand- ards, if it is determined that the infor- mation is not relevant to the current Federal award under consideration or there are specific conditions that can appropriately mitigate the effects of the non-Federal entity’s risk in accord- ance with § 75.207. (b) In addition, for competitive grants or cooperative agreements, the HHS awarding agency must have in place a framework for evaluating the risks posed by applicants before they receive Federal awards. This evalua- tion may incorporate results of the evaluation of the applicant’s eligibility or the qual lace a framework for evaluating the risks posed by applicants before they receive Federal awards. This evalua- tion may incorporate results of the evaluation of the applicant’s eligibility or the quality of its application. If the HHS awarding agency determines that a Federal award will be made, special conditions that correspond to the de- gree of risk assessed may be applied to the Federal award. Criteria to be evalu- ated must be described in the an- nouncement of funding opportunity de- scribed in § 75.203. (c) In evaluating risks posed by appli- cants, the HHS awarding agency may use a risk-based approach and may con- sider any items such as the following: (1) Financial stability; (2) Quality of management systems and ability to meet the management standards prescribed in this part; (3) History of performance. The appli- cant’s record in managing Federal awards, if it is a prior recipient of Fed- eral awards, including timeliness of compliance with applicable reporting the requirements, conformance terms and conditions of previous Fed- eral awards, and if applicable, the ex- tent to which any previously awarded amounts will be expended prior to fu- ture awards; to (4) Reports ments, conformance terms and conditions of previous Fed- eral awards, and if applicable, the ex- tent to which any previously awarded amounts will be expended prior to fu- ture awards; to (4) Reports and findings from audits performed under subpart F of this part or the reports and findings of any other available audits; and (5) The applicant’s ability to effec- tively regu- latory, or other requirements imposed on non-Federal entities. implement statutory, (d) In addition to this review, the HHS awarding agency must comply with the guidelines on government- wide suspension and debarment in 2 CFR part 180, and must require non- Federal entities to comply with these provisions. These provisions restrict Federal awards, subawards and con- tracts with certain parties that are 257 § 75.206 45 CFR Subtitle A (10–1–24 Edition) debarred, suspended or otherwise ex- cluded from or ineligible for participa- tion in Federal programs or activities. [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3014, Jan. 20, 2016; 81 FR 19044, Apr. 4, 2016] § 75.206 Standard application require- ments, including forms for applying for HHS financial assistance, and state plans. (a) Paperwork clearances. The 3014, Jan. 20, 2016; 81 FR 19044, Apr. 4, 2016] § 75.206 Standard application require- ments, including forms for applying for HHS financial assistance, and state plans. (a) Paperwork clearances. The HHS awarding agency may only use applica- tion information collections approved by OMB under the Paperwork Reduc- tion Act of 1995 and OMB’s imple- menting regulations in 5 CFR part 1320, Controlling Paperwork Burdens on the Public. Consistent with these require- ments, OMB will authorize additional information collections only on a lim- ited basis. (b) If applicable, the HHS awarding agency may inform applicants and re- cipients that they do not need to pro- vide certain information otherwise re- quired by the relevant information col- lection. (c) Forms for applying for HHS finan- cial assistance. HHS awarding agencies should use the Standard Form 424 (SF– 424 Application for Federal Assistance) series (or its successor) and its pro- gram narrative whenever possible. Al- ternative mechanisms may be used for formula grant programs which do not require applicants to apply for funds on a project basis. (1) Applicants shall use the SF–424 se- ries or those forms and instructions prescrib isms may be used for formula grant programs which do not require applicants to apply for funds on a project basis. (1) Applicants shall use the SF–424 se- ries or those forms and instructions prescribed by the HHS awarding agen- cy. (2) For Federal programs covered by Executive Order 12372, as amended by Executive Order 12416, the applicant shall complete the appropriate sections of the SF–424 indicating whether the application was subject to review by the State Single Point of Contact (SPOC). The name and address of the SPOC for a particular State can be ob- tained from the HHS awarding agency or the Catalog of Federal Domestic As- sistance. The SPOC shall advise the ap- plicant whether the program for which application is made has been selected by that State for review. (See also 45 CFR part 100.) (3) HHS awarding agencies that do not use the SF–424 series will indicate on the application form they prescribe whether the application is subject to review by the State under Executive Order 12372. (4) This section does not apply to ap- plications for subawards. (5) Except where otherwise noted, or granted by HHS deviation, HHS award- ing agencies shall direct applicants to apply for der 12372. (4) This section does not apply to ap- plications for subawards. (5) Except where otherwise noted, or granted by HHS deviation, HHS award- ing agencies shall direct applicants to apply for HHS financial assistance through Grants.gov, an OMB-des- ignated Web site for Find and Apply. (d) State plans. The statutes for some programs require States to submit plans before receiving grants. Under implementing Executive regulations Order 12372, States are allowed to sim- plify, consolidate and substitute plans. This section contains additional provi- sions for plans that are subject to regu- lations implementing Executive Order 12372. (1) Requirements. A State need meet only Federal administrative or pro- grammatic requirements for a plan that are in statutes or codified regula- tions. (2) Assurances. In each plan, the State will include an assurance that the State will comply with all applicable Federal statutes and regulations in ef- fect with respect to the periods for which it receives grant funding. For this assurance and other assurances re- quired in this plan, the State may: (i) Cite by number the statutory or regulatory provisions requiring the as- surances and affirm t eceives grant funding. For this assurance and other assurances re- quired in this plan, the State may: (i) Cite by number the statutory or regulatory provisions requiring the as- surances and affirm that it gives the assurances required by those provi- sions, (ii) Repeat the assurance language in the statutes or regulations, or (iii) Develop its own language to the extent permitted by law. (3) Amendments. A State will amend a plan whenever necessary to reflect: (i) New or revised Federal statutes or regulations, or (ii) A material change in any State law, organization, policy, or State agency operation. The State will ob- tain approval for the amendment and its effective date but need submit for approval only the amended portions of the plan. [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3015, Jan. 20, 2016] 258 Dept. of Health and Human Services § 75.210 § 75.207 Specific award conditions. § 75.208 Certifications and representa- (a) The HHS awarding agency or pass-through entity may impose addi- tional specific award conditions as needed in accordance with paragraphs (b) and (c) of this section, under the following circumstances: (1) Based on the criteria set forth in § 75.205; y impose addi- tional specific award conditions as needed in accordance with paragraphs (b) and (c) of this section, under the following circumstances: (1) Based on the criteria set forth in § 75.205; (2) When an applicant or recipient has a history of failure to comply with the general or specific terms and condi- tions of a Federal award; (3) When an applicant or recipient fails to meet expected performance goals as described in § 75.210, or; (4) When an applicant or recipient is not otherwise responsible. (b) These additional Federal award conditions may include items such as the following: (1) Requiring payments as reimburse- ments rather than advance payments; (2) Withholding authority to proceed to the next phase until receipt of evi- dence of acceptable performance within a given period of performance; (3) Requiring additional, more de- tailed financial reports; tions. Unless prohibited by Federal statutes or regulations, each HHS awarding agency or pass-through entity is au- thorized to require the non-Federal en- tity to submit certifications and rep- resentations required by Federal stat- utes, or regulations on an annual basis. Submission may be required more fre- quentl orized to require the non-Federal en- tity to submit certifications and rep- resentations required by Federal stat- utes, or regulations on an annual basis. Submission may be required more fre- quently if the non-Federal entity fails to meet a requirement of a Federal award. (a) The funds governed under this part shall be administered in compli- ance with the standards set forth in 45 CFR part 87. (b) For assurances under State plans, see § 75.206(d)(2). § 75.209 Pre-award costs. For requirements on costs incurred by the applicant prior to the start date of the period of performance of the Federal award, see § 75.458. § 75.210 Information contained in a Federal award. A Federal award must include the (4) Requiring additional project mon- following information: itoring; (5) Requiring the non-Federal entity to obtain technical or management as- sistance; or (6) Establishing additional prior ap- provals. (c) The HHS awarding agency or pass-through entity must notify the applicant or non-Federal entity as to: (a) General Federal award information. The HHS awarding agency must in- clude the following general Federal award information in each Federal award: (1) Recipient name (which must ederal entity as to: (a) General Federal award information. The HHS awarding agency must in- clude the following general Federal award information in each Federal award: (1) Recipient name (which must match the name associated with its unique entity identifier as defined in 2 CFR 25.315); (1) The nature of the additional re- (2) Recipient’s unique entity identi- quirements; fier; (2) The reason why the additional re- (3) Unique Federal Award Identifica- quirements are being imposed; tion Number (FAIN); (3) The nature of the action needed to remove the additional requirement, if applicable; (4) Federal Award Date (see § 75.2 Fed- eral award date); (5) Period of Performance Start and (4) The time allowed for completing End Date; the actions if applicable, and (5) The method for requesting recon- sideration of the additional require- ments imposed. (d) Any specific conditions must be promptly removed once the conditions that prompted them have been cor- rected. (6) Amount of Federal Funds Obli- gated by this action, (7) Total Amount of Federal Funds Obligated; (8) Total Amount of the Federal Award; (9) Budget Approved by the HHS Awarding Agency; [79 FR 75889, Dec. 19, 2014, as amended Obli- gated by this action, (7) Total Amount of Federal Funds Obligated; (8) Total Amount of the Federal Award; (9) Budget Approved by the HHS Awarding Agency; [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3015, Jan. 20, 2016] (10) Total Approved Cost Sharing or Matching, where applicable; 259 § 75.211 45 CFR Subtitle A (10–1–24 Edition) (11) Federal award project description (to comply with statutory require- ments (e.g., FFATA)); (12) Name of HHS awarding agency and contact information for awarding official, (13) CFDA Number and Program Name; (14) Identification of whether the award is R&D; and (15) Indirect cost rate for the Federal award (including if the de minimis rate is charged per § 75.414). (b) General terms and conditions. (1) HHS awarding agencies must incor- porate the following general terms and conditions either in the Federal award or by reference, as applicable: (i) Administrative requirements im- plemented by the HHS awarding agen- cy as specified in this part. (ii) National policy requirements. include statutory, executive These order, other Presidential directive, or regulatory requirements that apply by specific reference and are not program- specific. See i) National policy requirements. include statutory, executive These order, other Presidential directive, or regulatory requirements that apply by specific reference and are not program- specific. See § 75.300. (iii) Recipient integrity and perform- ance matters. If the total Federal share of the Federal award may include more than $500,000 over the period of per- formance, the HHS awarding agency must include the term and condition available in appendix XII. See also § 75.113. (2) The Federal award must include wording to incorporate, by reference, the applicable set of general terms and conditions, The reference must be to the Web site at which the HHS award- ing agency maintains the general terms and conditions. (3) If a non-Federal entity requests a copy of the full text of the general terms and conditions, the HHS award- ing agency must provide it. (4) Wherever the general terms and conditions are publicly available, the HHS awarding agency must maintain an archive of previous versions of the general terms and conditions, with ef- fective dates, for use by the non-Fed- eral entity, auditors, or others. (c) HHS awarding agency, program, or Federal award specific terms and condi- ions of the general terms and conditions, with ef- fective dates, for use by the non-Fed- eral entity, auditors, or others. (c) HHS awarding agency, program, or Federal award specific terms and condi- tions. The HHS awarding agency may include with each Federal award any terms and conditions necessary to com- municate requirements that are in ad- dition to the requirements outlined in the HHS awarding agency’s general terms and conditions. Whenever prac- ticable, these specific terms and condi- tions also should be shared on a public Web site and in notices of funding op- portunities (as outlined in § 75.203) in addition to being included in a Federal award. See also § 75.206. (d) Federal award performance goals. The HHS awarding agency must in- clude in the Federal award an indica- tion of the timing and scope of ex- pected performance by the non-Federal entity as related to the outcomes in- tended to be achieved by the program. In some instances (e.g., discretionary research awards), this may be limited to the requirement to submit technical performance reports (to be evaluated in accordance with HHS awarding agency policy). Where appropriate, the Federal award may include specif this may be limited to the requirement to submit technical performance reports (to be evaluated in accordance with HHS awarding agency policy). Where appropriate, the Federal award may include specific perform- ance goals, indicators, milestones, or expected outcomes (such as outputs, or services performed or public impacts of any of these) with an expected timeline for accomplishment. Reporting re- quirements must be clearly articulated such that, where appropriate, perform- ance during the execution of the Fed- eral award has a standard against which non-Federal entity performance can be measured. The HHS awarding agency may include program-specific requirements, as applicable. These re- quirements should be aligned with agency strategic goals, strategic objec- tives or performance goals that are rel- evant to the program. See also OMB Circular A–11 Preparation, Submission and Execution of the Budget, Part 6 for definitions of strategic objectives and performance goals. (e) Any other information required by the HHS awarding agency. [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3015, Jan. 20, 2016] § 75.211 Public access to Federal award information. (a) In accordance with sta r information required by the HHS awarding agency. [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3015, Jan. 20, 2016] § 75.211 Public access to Federal award information. (a) In accordance with statutory re- quirements for Federal spending trans- parency (e.g., FFATA), except as noted in this section, for applicable Federal awards the HHS awarding agency must announce all Federal awards publicly and publish the required information on a publicly available OMB-designated 260 Dept. of Health and Human Services § 75.212 government-wide Web site (at time of publication, www.USAspending.gov). (b) All information posted in the des- ignated integrity and performance sys- tem accessible through SAM (currently FAPIIS) on or after April 15, 2011 will be publicly available after a waiting period of 14 calendar days, except for: (1) Past performance reviews required by Federal Government contractors in accordance with the Federal Acquisi- tion Regulation (FAR) 42.15; (2) Information that was entered prior to April 15, 2011; or (3) Information that is withdrawn during the 14-calendar day waiting pe- riod by the Federal Government offi- cial. (c) Nothing in this section may be construed as re tered prior to April 15, 2011; or (3) Information that is withdrawn during the 14-calendar day waiting pe- riod by the Federal Government offi- cial. (c) Nothing in this section may be construed as requiring the publication of information otherwise exempt under the Freedom of Information Act (5 U.S.C. 552), or controlled unclassified information pursuant to Executive Order 13556. [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3015, Jan. 20, 2016] § 75.212 Reporting a determination that a recipient is not qualified for a Federal award. (a) If an HHS awarding agency does not make a Federal award to a non- Federal entity because the official de- termines that the non-Federal entity does not meet either or both of the minimum qualification standards as described in § 75.205(a)(2), the HHS awarding agency must report that de- termination to the designated integ- rity and performance system accessible through SAM (currently FAPIIS), only if all of the following apply: (1) The only basis for the determina- tion described in paragraph (a) of this section is the non-Federal entity’s prior record of executing programs or activities under Federal awards or its record of integrity and busine r the determina- tion described in paragraph (a) of this section is the non-Federal entity’s prior record of executing programs or activities under Federal awards or its record of integrity and business ethics, as described in § 75.205(a)(2), (i.e., the entity was determined to be qualified based on all factors other than those two standards), and (2) The total Federal share of the Federal award that otherwise would be made to the non-Federal entity is ex- pected to exceed the simplified acquisi- tion threshold over the period of per- formance. (b) The HHS awarding agency is not required to report a determination that a non-Federal entity is not qualified for a Federal award if it makes the Federal award to the non-Federal enti- ty and includes specific award terms and conditions, as described in § 75.207. (c) If an HHS awarding agency re- ports a determination that a non-Fed- eral entity is not qualified for a Fed- eral award, as described in paragraph (a) of this section, the HHS awarding agency also must notify the non-Fed- eral entity that— (1) The determination was made and reported to the designated integrity and performance system accessible through SAM, and include with the rding agency also must notify the non-Fed- eral entity that— (1) The determination was made and reported to the designated integrity and performance system accessible through SAM, and include with the no- tification an explanation of the basis for the determination; (2) The information will be kept in the system for a period of five years from the date of the determination, as required by section 872 of Public Law 110–417, as amended (41 U.S.C. 2313), then archived; (3) Each HHS awarding agency that considers making a Federal award to the non-Federal entity during that five year period must consider that infor- mation in judging whether the non- Federal entity is qualified to receive the Federal award when the total Fed- eral share of the Federal award is ex- pected to include an amount of Federal funding in excess of the simplified ac- quisition threshold over the period of performance; (4) The non-Federal entity may go to the awardee integrity and performance portal accessible through SAM (cur- rently the Contractor Performance As- sessment Reporting System (CPARS)) and comment on any information the system contains about the non-Federal entity itself; and (5) HHS awarding agenci h SAM (cur- rently the Contractor Performance As- sessment Reporting System (CPARS)) and comment on any information the system contains about the non-Federal entity itself; and (5) HHS awarding agencies will con- sider that non-Federal entity’s com- ments in determining whether the non- Federal entity is qualified for the fu- ture Federal award. (d) If an HHS awarding agency enters information into the designated integ- rity and performance system accessible through SAM about a determination that a non-Federal entity is not quali- fied for a Federal award and subse- quently: 261 § 75.213 45 CFR Subtitle A (10–1–24 Edition) (1) Learns that any of that informa- tion is erroneous, the HHS awarding agency must correct the information in the system within three business days; (2) Obtains an update to that infor- mation that could be helpful to other Federal awarding agencies, the HHS awarding agency is strongly encour- aged to amend the information in the system to incorporate the update in a timely way. (e) HHS awarding agencies shall not post any information that will be made publicly available in the non-public segment of the designated integrity and performance system that is cov- e a timely way. (e) HHS awarding agencies shall not post any information that will be made publicly available in the non-public segment of the designated integrity and performance system that is cov- ered by a disclosure exemption under the Freedom of Information Act. If the recipient asserts within seven calendar days to the HHS awarding agency that posted the information that some or all of the information made publicly avail- able is covered by a disclosure exemp- tion under the Freedom of Information Act, the HHS awarding agency that posted the information must remove the posting within seven calendar days of receiving the assertion. Prior to re- posting the releasable information, the HHS awarding agency must resolve the issue in accordance with the agency’s Freedom of Information Act proce- dures. [81 FR 3015, Jan. 20, 2016] § 75.213 Suspension and debarment. Non-federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR parts 180 and 376. These regulations re- strict awards, subawards and contracts with certain parties that are debarred, suspended or otherwise excluded from or ineligible for pa 12549 and 12689, 2 CFR parts 180 and 376. These regulations re- strict awards, subawards and contracts with certain parties that are debarred, suspended or otherwise excluded from or ineligible for participation in Fed- eral assistance programs or activities. [79 FR 75889, Dec. 19, 2014. Redesignated and amended at 81 FR 3015, 3016, Jan. 20, 2016] § 75.214 Metric system of measure- ment. The Metric Conversion Act, as amended by the Omnibus Trade and Competitiveness Act, 15 U.S.C. 205, de- clares that the metric system is the preferred measurement system for United States trade and commerce. HHS awarding agencies will follow the provisions of Executive Order 12770. [79 FR 75889, Dec. 19, 2014. Redesignated at 81 FR 3015, Jan. 20, 2016] § 75.215 Disclosure of lobbying activi- ties. Recipients are subject to the restric- tions on lobbying as set forth in 45 CFR part 93. [79 FR 75889, Dec. 19, 2014. Redesignated at 81 FR 3015, Jan. 20, 2016] § 75.216 Special provisions for awards to commercial organizations as re- cipients. (a) This section contains provisions that apply to awards to commercial or- ganizations. These provisions are in ad- dition to other applicable provisions of this p cial organizations as re- cipients. (a) This section contains provisions that apply to awards to commercial or- ganizations. These provisions are in ad- dition to other applicable provisions of this part, or they make exceptions from other provisions of this part for awards to commercial organizations. (b) Prohibition against profit. Except for awards under the Small Business Innovation Research (SBIR) and Small Business Technology Transfer Re- search (STTR) programs (15 U.S.C. 638), no HHS funds may be paid as profit to any recipient even if the recipient is a commercial organization. Profit is any amount in excess of allowable direct and indirect costs. (c) Program income. Except for grants for research, program income earned by a commercial organization may not be used to further eligible project or program objectives except in the SBIR and STTR programs. (d)(1) Commercial organizations that receive awards (including for-profit hospitals) have two options regarding audits: (i) A financial related audit of a par- ticular award in accordance with Gen- erally Accepted Government Auditing Standards issued by the Comptroller General of the United States, in those cases where the comm ancial related audit of a par- ticular award in accordance with Gen- erally Accepted Government Auditing Standards issued by the Comptroller General of the United States, in those cases where the commercial organiza- tion receives awards under only one HHS program; or, if awards are re- ceived under multiple HHS programs, a financial related audit of all awards in accordance with Generally Accepted Government Auditing Standards issued by the Comptroller General of the United States; or (ii) An audit that meets the require- ments contained in subpart F. 262 Dept. of Health and Human Services § 75.300 (2) Commercial organizations that re- ceive annual awards totaling less than the audit requirement threshold in sub- part F are exempt from HHS audit re- quirements for that year, but records must be available for review by appro- priate officials of Federal agencies or the Government Accountability Office. (See § 75.501). [79 FR 75889, Dec. 19, 2014. Redesignated at 81 FR 3015, Jan. 20, 2016] § 75.217 Special provisions for awards to Federal agencies. (a) In order for an HHS awarding agency to make a Federal award to a Federal agency, the HHS awarding agency must have statutory authori 16] § 75.217 Special provisions for awards to Federal agencies. (a) In order for an HHS awarding agency to make a Federal award to a Federal agency, the HHS awarding agency must have statutory authority that makes such Federal agency ex- plicitly eligible for a Federal award. (b) All provisions of this part and other HHS regulations apply to Federal entities receiving Federal awards, ex- cept for the following: (1) Except for grants for research, any program income earned by a Fed- eral institution must be used under the deduction alternative. Any program in- come earned after the end of grant sup- port should be returned to the United States Treasury. (2) No salary or fringe benefit pay- ments may be made from HHS award- ing agency grant funds to support ca- reer, career-conditional, or other Fed- eral employees (civilian or uniformed services) without permanent appoint- ments at a Federal institution receiv- ing a grant. While the level of effort re- quired for the project must be allowed by the recipient as part of each individ- ual’s official duties, salary costs asso- ciated with an individual participating in an official capacity as a Federal em- ployee under a grant to that lowed by the recipient as part of each individ- ual’s official duties, salary costs asso- ciated with an individual participating in an official capacity as a Federal em- ployee under a grant to that Federal institution are not allowable costs under an HHS awarding agency grant. (3) Federal agencies may not be reim- bursed for indirect costs under Federal awards. [79 FR 75889, Dec. 19, 2014. Redesignated at 81 FR 3015, Jan. 20, 2016] § 75.218 Participation by faith-based organizations. The funds provided under this part must be administered in compliance with the standards set forth in 45 CFR part 87. [79 FR 75889, Dec. 19, 2014. Redesignated at 81 FR 3015, Jan. 20, 2016] Subpart D—Post Federal Award Requirements STANDARDS FOR FINANCIAL AND PROGRAM MANAGEMENT § 75.300 Statutory and national policy requirements. (a) The Federal awarding agency must manage and administer the Fed- eral award in a manner so as to ensure that Federal funding is expended and associated programs are implemented in full accordance with U.S. statutory and public policy requirements: Includ- ing, but not limited to, those pro- tecting public welfare, the environ- ment, and prohibiting discrimination. The Fed ed in full accordance with U.S. statutory and public policy requirements: Includ- ing, but not limited to, those pro- tecting public welfare, the environ- ment, and prohibiting discrimination. The Federal awarding agency must communicate to the non-Federal enti- ty all relevant public policy require- ments, including those in general ap- propriations provisions, and incor- porate them either directly or by ref- erence in the terms and conditions of the Federal award. (b) The non-Federal entity is respon- sible for complying with all require- ments of the Federal award. For all Federal awards, this includes the provi- sions of FFATA, which includes re- quirements on executive compensation, and also requirements implementing the Act for the non-Federal entity at 2 CFR part 25 and 2 CFR part 170. See also statutory requirements for whis- tleblower protections at 10 U.S.C. 2324 and 2409, and 41 U.S.C. 4304, 4310, and 4712. (c) It is a public policy requirement of HHS that no person otherwise eligi- ble will be excluded from participation in, denied the benefits of, or otherwise subjected to discrimination in the ad- ministration of HHS programs, activi- ties, projects, assistance, and se eligi- ble will be excluded from participation in, denied the benefits of, or otherwise subjected to discrimination in the ad- ministration of HHS programs, activi- ties, projects, assistance, and services, to the extent doing so is prohibited by Federal statute. (d) HHS will follow all applicable Su- preme Court decisions in administering its award programs. 263 § 75.300 45 CFR Subtitle A (10–1–24 Edition) (e) In the statutes listed in para- graphs (e)(1) through (13) of this sec- tion that HHS administers which pro- hibit discrimination on the basis of sex, the Department interprets those provisions to include a prohibition against discrimination on the basis of sexual orientation and gender identity, consistent with the Supreme Court’s decision in Bostock v. Clayton County, 590 U.S. 644 (2020), and other Federal court precedent applying Bostock’s rea- soning that sex discrimination includes discrimination based on sexual orienta- tion and gender identity. This provi- sion is interpretive and does not im- pose any substantive obligations on en- tities outside the Department. This paragraph (e) interprets the following HHS authorities that prohibit discrimi- nation on the basis rpretive and does not im- pose any substantive obligations on en- tities outside the Department. This paragraph (e) interprets the following HHS authorities that prohibit discrimi- nation on the basis of sex: (1) 8 U.S.C. 1522. Authorization for programs for domestic resettlement of and assistance to refugees. (2) 42 U.S.C. 290cc–33. Projects for As- sistance in Transition from Homeless- ness. (3) 42 U.S.C. 290ff–1. Children with Se- rious Emotional Disturbances. (4) 42 U.S.C. 295m. Title VII Health Workforce Programs. (5) 42 U.S.C. 296g. Nursing Workforce Development. (6) 42 U.S.C. 300w–7. Preventive Health Services Block Grant. (7) 42 U.S.C. 300x–57. Substance Use Prevention, Treatment, and Recovery Services Block Grant; Community Mental Health Services Block Grant. (8) 42 U.S.C. 708. Maternal and Child Health Block Grant. (9) 42 U.S.C. 5151. Disaster relief. (10) 42 U.S.C. 8625. Low Income Home Energy Assistance Program. (11) 42 U.S.C. 9849. Head Start. (12) 42 U.S.C. 9918. Community Serv- ices Block Grant Program. (13) 42 U.S.C. 10406. Family Violence Prevention and Services. (f)(1) A grant applicant or recipient may rely on applicable Federal protec- tions for religious freedo y Serv- ices Block Grant Program. (13) 42 U.S.C. 10406. Family Violence Prevention and Services. (f)(1) A grant applicant or recipient may rely on applicable Federal protec- tions for religious freedom and con- science, and application of a particular provision(s) of this section to specific contexts, procedures, or services shall not be required where such protections apply. (2) A grant applicant or recipient that seeks assurance consistent with paragraph (f)(1) of this section regard- ing the application of particular provi- sion(s) of this part to specific contexts, procedures, or services may do so by submitting a notification in writing to the HHS awarding agency, the Office of the Assistant Secretary for Financial Resources (ASFR), or the Office for Civil Rights (OCR). Notification may be provided by the grant applicant or recipient at any time, including before an investigation is initiated or during the pendency of an investigation. The notification must include: (i) The particular provision(s) of this section from which the applicant or re- cipient asserts they are exempt under freedom or con- Federal religious science protections; (ii) The legal basis supporting the ap- p ular provision(s) of this section from which the applicant or re- cipient asserts they are exempt under freedom or con- Federal religious science protections; (ii) The legal basis supporting the ap- plicant’s or recipient’s exemption should include the standards governing the applicable Federal religious free- dom and conscience protections, such as the provisions in the relevant stat- ute from which the applicant or recipi- ent is requesting an exemption; the Church, Coats-Snowe, and Weldon Amendments; the generally applicable requirements of the Religious Freedom Restoration Act (RFRA); and (iii) The factual basis supporting the applicant’s or recipient’s exemption, including identification of the conflict between the applicant’s or recipient’s religious or conscience beliefs and the requirements of this section, which may include the specific contexts, pro- cedures, or services that the applicant or recipient asserts will violate their religious or conscience beliefs overall or based on an individual matter re- lated to a particular grant. (3) A temporary exemption from ad- ministrative investigation and enforce- ment will take effect upon the appli- cant’s or recipient’s submis d on an individual matter re- lated to a particular grant. (3) A temporary exemption from ad- ministrative investigation and enforce- ment will take effect upon the appli- cant’s or recipient’s submission of the notification—regardless of whether the assurance is sought before or during an investigation. The temporary exemp- tion is limited to the application of the particular provision(s) of the relevant statute as applied to the specific con- texts, procedures, or services identified in the notification to the HHS award- ing agency, ASFR, or OCR. (i) If the notification is received be- fore an investigation is initiated, with- in 30 days of receiving the notification, 264 Dept. of Health and Human Services § 75.301 OCR, ASFR, or the HHS awarding agency must provide the applicant or recipient with email confirmation ac- knowledging receipt of the notifica- tion. The HHS awarding agency, work- ing jointly with ASFR and OCR, will then work expeditiously to reach a de- termination of applicant’s or recipi- ent’s notification request. (ii) If the notification is received dur- ing the pendency of an investigation, the temporary exemption will exempt conduct as applied to the specific c licant’s or recipi- ent’s notification request. (ii) If the notification is received dur- ing the pendency of an investigation, the temporary exemption will exempt conduct as applied to the specific con- texts, procedures, or services identified in the notification during the pendency of the HHS awarding agency’s review and determination, working jointly with ASFR and OCR, regarding the no- tification request. The notification shall further serve as a defense to the relevant investigation or enforcement activity regarding the applicant or re- cipient until the final determination of the applicant’s or recipient’s exemp- tion assurance request or the conclu- sion of the investigation. (4) If the HHS awarding agency, working jointly with ASFR and OCR, makes a determination to provide as- surance of the applicant’s or recipient’s exemption from the application of the relevant statutory provision(s) or that modified application of certain provi- sion(s) is required, the HHS awarding agency, ASFR, or OCR, will provide the applicant or recipient the determina- tion in writing, and if granted, the ap- plicant or recipient will be considered exempt from OCR’s administrative in- vestigation , ASFR, or OCR, will provide the applicant or recipient the determina- tion in writing, and if granted, the ap- plicant or recipient will be considered exempt from OCR’s administrative in- vestigation and enforcement with re- gard to the application of that provi- sion(s) as applied to the specific con- texts, procedures, or services provided. The determination does not otherwise limit the application of any other pro- vision of the relevant statute to the ap- plicant or recipient or to other con- texts, procedures, or services. (5) An applicant or recipient subject to an adverse determination of its re- quest for an exemption assurance may appeal the Department’s determination under the administrative procedures set forth at 45 CFR part 81. The tem- porary exemption provided for in para- graph (f)(3) of this section will expire upon a final decision under 45 CFR part 81. (6) A determination under paragraph (f) of this section is not final for pur- poses of judicial review until after a final decision under 45 CFR part 81. (g) Any provision of this section held to be invalid or unenforceable by its terms, or as applied to any person or circumstance, shall be severable from this sec a final decision under 45 CFR part 81. (g) Any provision of this section held to be invalid or unenforceable by its terms, or as applied to any person or circumstance, shall be severable from this section and shall not affect the re- mainder thereof or the application of the provision to other persons not similarly situated or to other, dis- similar circumstances. [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 89395, Dec. 12, 2016; 86 FR 2278, Jan. 12, 2021; 89 FR 36704, May 3, 2024] § 75.301 Performance measurement. The HHS awarding agency must re- quire the recipient to use OMB ap- proved standard information collec- tions when providing financial and per- formance information. As appropriate and in accordance with above men- tioned information collections, the HHS awarding agency must require the recipient to relate financial data to performance accomplishments of the Federal award. Also, in accordance with above mentioned standard infor- mation collections, and when applica- ble, recipients must also provide cost information to demonstrate cost effec- tive practices (e.g., through unit cost data). The recipient’s performance should be measured in a way that will help the HHS recipients must also provide cost information to demonstrate cost effec- tive practices (e.g., through unit cost data). The recipient’s performance should be measured in a way that will help the HHS awarding agency and other non-Federal entities to improve program outcomes, lessons learned, and spread the adoption of promising practices. The HHS award- ing agency should provide recipients with clear performance goals, indica- tors, and milestones as described in § 75.210. Performance reporting fre- quency and content should be estab- lished to not only allow the HHS awarding agency to understand the re- cipient progress but also to facilitate identification of promising practices among recipients and build the evi- dence upon which the HHS awarding agency’s program and performance de- cisions are made. share 265 § 75.302 45 CFR Subtitle A (10–1–24 Edition) § 75.302 Financial management and financial manage- standards for ment systems. (a) Each state must expend and ac- count for the Federal award in accord- ance with state laws and procedures for expending and accounting for the state’s own funds. In addition, the state’s and the other non- Federal enti- ty’s financial management ederal award in accord- ance with state laws and procedures for expending and accounting for the state’s own funds. In addition, the state’s and the other non- Federal enti- ty’s financial management systems, in- cluding records documenting compli- ance with Federal statutes, regula- tions, and the terms and conditions of the Federal award, must be sufficient to permit the preparation of reports re- quired by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures ade- quate to establish that such funds have been used according to the Federal statutes, regulations, and the terms and conditions of the Federal award. See also § 75.450. (b) The financial management sys- tem of each non-Federal entity must provide for the following (see also §§ 75.361, 75.362, 75.363, 75.364, and 75.365): (1) Identification, in its accounts, of all Federal awards received and ex- pended and the Federal programs under which they were received. Federal pro- gram and Federal award identification must include, as applicable, the CFDA title and number, Federal award identi- fication number and year, name of the HHS awarding agency, and name of the pass-through and Federal award identification must include, as applicable, the CFDA title and number, Federal award identi- fication number and year, name of the HHS awarding agency, and name of the pass-through entity, if any. (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in ac- cordance with the reporting require- ments set forth in §§ 75.341 and 75.342. If an HHS awarding agency requires re- porting on an accrual basis from a re- cipient that maintains its records on other than an accrual basis, the recipi- ent must not be required to establish an accrual accounting system. This re- cipient may develop accrual data for its reports on the basis of an analysis of the documentation on hand. Simi- larly, a pass-through entity must not require a subrecipient to establish an accrual accounting system and must allow the subrecipient to develop ac- crual data for its reports on the basis of an analysis of the documentation on hand. activities. (3) Records that identify adequately the source and application of funds for federally-funded These records must contain information per- taining to Federal awards, authoriza- tions, obligations, unob (3) Records that identify adequately the source and application of funds for federally-funded These records must contain information per- taining to Federal awards, authoriza- tions, obligations, unobligated bal- ances, assets, expenditures, income and interest and be supported by source documentation. (4) Effective control over, and ac- countability for, all funds, property, and other assets. The non-Federal enti- ty must adequately safeguard all assets and assure that they are used solely for authorized purposes. See § 75.303. (5) Comparison of expenditures with for each Federal budget amounts award. (6) Written procedures to implement the requirements of § 75.305. (7) Written procedures for deter- mining the allowability of costs in ac- cordance with subpart E of this part and the terms and conditions of the Federal award. § 75.303 Internal controls. The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assur- ance that the non-Federal entity is managing the Federal award in compli- ance with Federal statutes, regula- tions, and the terms and conditions of the Federal award. These internal con- trols sh ur- ance that the non-Federal entity is managing the Federal award in compli- ance with Federal statutes, regula- tions, and the terms and conditions of the Federal award. These internal con- trols should be in compliance with guidance in ‘‘Standards for Internal Control in the Federal Government,’’ issued by the Comptroller General of the United States or the ‘‘Internal Con- trol Integrated Framework,’’ issued by the Committee of Sponsoring Organiza- tions of the Treadway Commission (COSO). (b) Comply with Federal statutes, regulations, and the terms and condi- tions of the Federal awards. (c) Evaluate and monitor the non- Federal entity’s compliance with stat- utes, regulations and the terms and conditions of Federal awards. (d) Take prompt action when in- stances of noncompliance are identified including noncompliance identified in audit findings. (e) Take reasonable measures to safe- guard protected personally identifiable information and other information the 266 Dept. of Health and Human Services § 75.305 HHS awarding agency or pass-through entity designates as sensitive or the non-Federal entity considers sensitive consistent with applicable Federal, state, local, and tribal nd Human Services § 75.305 HHS awarding agency or pass-through entity designates as sensitive or the non-Federal entity considers sensitive consistent with applicable Federal, state, local, and tribal laws regarding privacy and obligations of confiden- tiality. § 75.304 Bonds. The HHS awarding agency may in- clude a provision on bonding, insur- ance, or both in the following cir- cumstances: (a) Where the Federal Government guarantees or insures the repayment of money borrowed by the recipient, the HHS awarding agency, at its discre- tion, may require adequate bonding and insurance if the bonding and insur- ance requirements of the non-Federal entity are not deemed adequate to pro- tect the interest of the Federal Govern- ment. (b) The HHS awarding agency may require adequate fidelity bond coverage where the non-Federal entity lacks suf- ficient coverage to protect the Federal Government’s interest. (c) Where bonds are required in the situations described above, the bonds must be obtained from companies hold- ing certificates of authority as accept- able sureties, as prescribed in 31 CFR part 223. § 75.305 Payment. (a)(1) For States, payments are gov- erned by Treasury-State CMIA a ned from companies hold- ing certificates of authority as accept- able sureties, as prescribed in 31 CFR part 223. § 75.305 Payment. (a)(1) For States, payments are gov- erned by Treasury-State CMIA agree- ments and default procedures codified at 31 CFR part 205 and TFM 4A–2000 Overall Disbursing Rules for All Fed- eral Agencies. (2) To the extent that Treasury-State CMIA agreements and default proce- dures do not address expenditure of program income, rebates, refunds, con- tract settlements, audit recoveries and interest earned on such funds, such funds must be expended before request- ing additional cash payments. (b) For non-Federal entities other than states, payments methods must minimize the time elapsing between the transfer of funds from the United States Treasury or the pass-through entity and the disbursement by the non-Federal entity whether the pay- ment is made by electronic funds transfer, or issuance or redemption of checks, warrants, or payment by other means. See also § 75.302(b)(6). Except as noted elsewhere in this part, HHS awarding agencies must require recipi- ents to use only OMB-approved stand- ard governmentwide information col- lection requests to request § 75.302(b)(6). Except as noted elsewhere in this part, HHS awarding agencies must require recipi- ents to use only OMB-approved stand- ard governmentwide information col- lection requests to request payment. (1) The non-Federal entity must be paid in advance, provided it maintains or demonstrates the willingness to maintain both written procedures that minimize the time elapsing between the transfer of funds and disbursement by the non-Federal entity, and finan- cial management systems that meet the standards for fund control and ac- countability as established in this part. Advance payments to a non-Federal en- tity must be limited to the minimum amounts needed and be timed to be in accordance with the actual, immediate cash requirements of the non-Federal entity in carrying out the purpose of the approved program or project. The timing and amount of advance pay- ments must be as close as is adminis- tratively feasible to the actual dis- bursements by the non-Federal entity for direct program or project costs and the proportionate share of any allow- able indirect costs. The non-Federal entity must make timely payment to contractors in accordance with the contract provisions. (2 ct program or project costs and the proportionate share of any allow- able indirect costs. The non-Federal entity must make timely payment to contractors in accordance with the contract provisions. (2) Whenever possible, advance pay- ments must be consolidated to cover anticipated cash needs for all Federal awards made by the HHS awarding agency to the recipient. (i) Advance payment mechanisms in- clude, but are not limited to, Treasury check and electronic funds transfer and must comply with applicable guidance in 31 CFR part 208. (ii) Non-Federal entities must be au- thorized to submit requests for advance payments and reimbursements at least monthly when electronic fund transfers are not used, and as often as they like when electronic transfers are used, in accordance with the provisions of the Electronic Fund Transfer Act (15 U.S.C. 1693–1693r). (3) Reimbursement is the preferred method when the requirements in para- graph (b) cannot be met, when the HHS 267 § 75.305 45 CFR Subtitle A (10–1–24 Edition) awarding agency sets a specific condi- tion per § 75.207, or when the non-Fed- eral entity requests payment by reim- bursement. This method may be used on any Federal award for c e A (10–1–24 Edition) awarding agency sets a specific condi- tion per § 75.207, or when the non-Fed- eral entity requests payment by reim- bursement. This method may be used on any Federal award for construction, or if the major portion of the construc- tion project is accomplished through private market financing or Federal loans, and the Federal award con- stitutes a minor portion of the project. When the reimbursement method is used, the HHS awarding agency or pass-through entity must make pay- ment within 30 calendar days after re- ceipt of the billing, unless the HHS awarding agency or pass-through enti- ty reasonably believes the request to be improper. (4) If the non-Federal entity cannot meet the criteria for advance payments and the HHS awarding agency or pass- through entity has determined that re- imbursement is not feasible because the non-Federal entity lacks sufficient working capital, the HHS awarding agency or pass-through entity may provide cash on a working capital ad- vance basis. Under this procedure, the HHS awarding agency or pass-through entity must advance cash payments to the non-Federal entity to cover its es- timated disbursement needs for an ini- tial pe - vance basis. Under this procedure, the HHS awarding agency or pass-through entity must advance cash payments to the non-Federal entity to cover its es- timated disbursement needs for an ini- tial period generally geared to the non- Federal entity’s disbursing cycle. Thereafter, the HHS awarding agency or pass-through entity must reimburse the non-Federal entity for its actual cash disbursements. Use of the working capital advance method of payment re- quires that the pass-through entity provide timely advance payments to any subrecipients in order to meet the subrecipient’s actual cash disburse- ments. The working capital advance method of payment must not be used by the pass-through entity if the rea- son for using this method is the unwill- ingness or inability of the pass-through entity to provide timely advance pay- ments to the subrecipient to meet the subrecipient’s actual cash disburse- ments. (5) Use of resources before requesting cash advance payments. To the extent available, the non-Federal entity must disburse funds available from program income (including repayments to a re- volving fund), rebates, refunds, con- tract settlements, audit recoveries, and interest earne e, the non-Federal entity must disburse funds available from program income (including repayments to a re- volving fund), rebates, refunds, con- tract settlements, audit recoveries, and interest earned on such funds before re- questing additional cash payments. (6) Unless otherwise required by Fed- eral statutes, payments for allowable costs by non-Federal entities must not be withheld at any time during the pe- riod of performance unless the condi- tions of §§ 75.207, subpart D of this part, 75.371, or one or more of the following applies: (i) The non-Federal entity has failed to comply with the project objectives, Federal statutes, regulations, or the terms and conditions of the Federal award. (ii) The non-Federal entity is delin- quent in a debt to the United States as defined in OMB Guidance A–129 ‘‘Poli- cies for Federal Credit Programs and Non-Tax Receivables.’’ (iii) A payment withheld for failure to comply with Federal award condi- tions, but without suspension of the Federal award, must be released to the non-Federal entity upon subsequent compliance. When a Federal award is suspended, payment adjustments will be made in accordance with § 75.375. (iv) A payment must not be ward, must be released to the non-Federal entity upon subsequent compliance. When a Federal award is suspended, payment adjustments will be made in accordance with § 75.375. (iv) A payment must not be made to a non-Federal entity for amounts that are withheld by the non-Federal entity from payment to contractors to assure satisfactory completion of work. A payment must be made when the non- Federal entity actually disburses the withheld funds to the contractors or to escrow accounts established to assure satisfactory completion of work. (7) Standards governing the use of banks and other institutions as deposi- tories of advance payments under Fed- eral awards are as follows: (i) The HHS awarding agency and pass-through entity must not require separate depository accounts for funds provided to a non-Federal entity or es- tablish any eligibility requirements for depositories for funds provided to the non-Federal entity. However, the non- Federal entity must be able to account for the receipt, obligation and expendi- ture of funds. (ii) Advance payments of Federal funds must be deposited and main- tained in insured accounts whenever possible. (8) The non-Federal entity must maintain a eipt, obligation and expendi- ture of funds. (ii) Advance payments of Federal funds must be deposited and main- tained in insured accounts whenever possible. (8) The non-Federal entity must maintain advance payments of Federal 268 Dept. of Health and Human Services § 75.306 awards in interest-bearing accounts, unless the following apply: (i) The non-Federal entity receives less than $120,000 in Federal awards per year. (ii) The best reasonably available in- terest-bearing account would not be ex- pected to earn interest in excess of $500 per year on Federal cash balances. (iii) The depository would require an average or minimum balance so high that it would not be feasible within the expected Federal and non-Federal cash resources. (iv) A foreign government or banking system prohibits or precludes interest bearing accounts. (9) Interest earned amounts up to $500 per year may be retained by the non- Federal entity for administrative ex- pense. Any additional interest earned on Federal advance payments deposited in interest-bearing accounts must be remitted annually to the Department of Health and Human Services Pay- ment Management System (PMS) through an electronic medium using ei- dvance payments deposited in interest-bearing accounts must be remitted annually to the Department of Health and Human Services Pay- ment Management System (PMS) through an electronic medium using ei- ther Automated Clearing House (ACH) network or a Fedwire Funds Service payment. Remittances must include pertinent information of the payee and nature of the payment in the memo area (often referred to as ‘‘addenda records’’ by Financial Institutions) as that will assist in the timely posting of interest earned on federal funds. Perti- nent details include the Payee Account Number (PAN) if the payment origi- nated from PMS, or Agency informa- tion, if the payment originated from ASAP, NSF or another federal agency payment system. The remittance must be submitted as follows: For ACH Returns: Routing Number: 051036706 Account number: 303000 Bank Name and Location: Credit Gateway— ACH Receiver St. Paul, MN For Fedwire Returns*: Routing Number: 021030004 Account number: 75010501 Bank Name and Location: Federal Reserve Bank Treas NYC/Funds Transfer Division New York, NY (* Please note organization initiating pay- ment is likely to incur a charge from your Financial Institution for this typ Location: Federal Reserve Bank Treas NYC/Funds Transfer Division New York, NY (* Please note organization initiating pay- ment is likely to incur a charge from your Financial Institution for this type of pay- ment) For International ACH Returns: Beneficiary Account: Federal Reserve Bank of New York/ITS (FRBNY/ITS) Bank: Citibank N.A. (New York) Swift Code: CITIUS33 Account Number: 36838868 Bank Address: 388 Greenwich Street, New York, NY 10013 USA Payment Details (Line 70): Agency Name (abbreviated when possible) and ALC Agen- cy POC: Michelle Haney, (301) 492–5065 For recipients that do not have electronic remittance capability, please make check** payable to: ‘‘The Department of Health and Human Services’’ Mail Check to Treasury approved lockbox: HHS Program Support Center P.O. Box 530231 Atlanta, GA 30353–0231 (** Please allow 4–6 weeks for processing of a payment by check to be applied to the ap- propriate PMS account) Any additional information/instructions may be found on the PMS Web site at http:// www.dpm.psc.gov/. [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3016, Jan. 20, 2016; 86 FR 2278, Jan. 12, 2021] § 75.306 Cost sharing or matching. (a) Under Federal research p S Web site at http:// www.dpm.psc.gov/. [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3016, Jan. 20, 2016; 86 FR 2278, Jan. 12, 2021] § 75.306 Cost sharing or matching. (a) Under Federal research proposals, voluntary committed cost sharing is not expected. It cannot be used as a factor during the merit review of appli- cations or proposals, but may be con- sidered if it is both in accordance with HHS awarding agency regulations and specified in a notice of funding oppor- tunity. Criteria for considering vol- untary committed cost sharing and any other program policy factors that may be used to determine who may re- ceive a Federal award must be explic- itly described in the notice of funding opportunity. Furthermore, only man- datory cost sharing or cost sharing spe- cifically committed in the project budget must be included in the orga- nized research base for computing the indirect (F&A) cost rate or reflected in any allocation of indirect costs. See also §§ 75.414, 75.203, and appendix I to this part. (b) For all Federal awards, any shared costs or matching funds and all contributions, including cash and third party in-kind contributions, must be accepted as part of the non-F pendix I to this part. (b) For all Federal awards, any shared costs or matching funds and all contributions, including cash and third party in-kind contributions, must be accepted as part of the non-Federal en- tity’s cost sharing or matching when such contributions meet all of the fol- lowing criteria: 269 § 75.306 45 CFR Subtitle A (10–1–24 Edition) (1) Are verifiable from the non-Fed- eral entity’s records; (2) Are not included as contributions for any other Federal award; (3) Are necessary and reasonable for accomplishment of project or program objectives; (4) Are allowable under subpart E of this part; (5) Are not paid by the Federal Gov- ernment under another Federal award, except where the Federal statute au- thorizing a program specifically pro- vides that Federal funds made avail- able for such program can be applied to matching or cost sharing requirements of other Federal programs; (6) Are provided for in the approved budget when required by the HHS awarding agency; and (7) Conform to other provisions of this part, as applicable. (c) Unrecovered indirect costs, in- cluding indirect costs on cost sharing or matching may be included as part of cost sharing or matching only Conform to other provisions of this part, as applicable. (c) Unrecovered indirect costs, in- cluding indirect costs on cost sharing or matching may be included as part of cost sharing or matching only with prior approval of the HHS awarding indirect cost agency. Unrecovered means the difference between the amount charged to the Federal award and the amount which could have been charged to the Federal award under the non-Federal entity’s approved nego- tiated indirect cost rate. (d) Values for non-Federal entity contributions of services and property must be established in accordance with the cost principles in subpart E. If an HHS awarding agency authorizes the non-Federal entity to donate buildings or land for construction/facilities ac- quisition projects or long-term use, the value of the donated property for cost sharing or matching must be the lesser of paragraphs (d)(1) or (2) of this sec- tion. (1) The value of the remaining life of the property recorded in the non-Fed- eral entity’s accounting records at the time of donation. (2) The current fair market value. However, when there is sufficient jus- tification, the HHS awarding agency may approve the use of the current fair ity’s accounting records at the time of donation. (2) The current fair market value. However, when there is sufficient jus- tification, the HHS awarding agency may approve the use of the current fair market value of the donated property, even if it exceeds the value described in paragraph (1) of this section at the time of donation. (e) Volunteer services furnished by third-party professional and technical personnel, consultants, and other skilled and unskilled labor may be counted as cost sharing or matching if the service is an integral and necessary part of an approved project or program. Rates for third-party volunteer serv- ices must be consistent with those paid for similar work by the non-Federal en- tity. In those instances in which the required skills are not found in the non-Federal entity, rates must be con- sistent with those paid for similar work in the labor market in which the non-Federal entity competes for the kind of services involved. In either case, paid fringe benefits that are rea- sonable, necessary, allocable, and oth- erwise allowable may be included in the valuation. (f) When a third-party organization furnishes the services of an employee, these services fits that are rea- sonable, necessary, allocable, and oth- erwise allowable may be included in the valuation. (f) When a third-party organization furnishes the services of an employee, these services must be valued at the employee’s regular rate of pay plus an amount of fringe benefits that is rea- sonable, necessary, allocable, and oth- erwise allowable, and indirect costs at either the third-party organization’s approved federally negotiated indirect cost rate or, a rate in accordance with § 75.414(f), provided these services em- ploy the same skill(s) for which the employee is normally paid. Where do- nated services are treated as indirect costs, indirect cost rates will separate the value of the donated services so that reimbursement for the donated services will not be made. (g) Donated property from third par- ties may include such items as equip- ment, office supplies, laboratory sup- plies, or workshop and classroom sup- plies. Value assessed to donated prop- erty included in the cost sharing or matching share must not exceed the fair market value of the property at the time of the donation. (h) The method used for determining cost sharing or matching for third- party-donat he cost sharing or matching share must not exceed the fair market value of the property at the time of the donation. (h) The method used for determining cost sharing or matching for third- party-donated equipment, buildings and land for which title passes to the non-Federal entity may differ accord- ing to the purpose of the Federal award, if paragraph (h)(1) or (2) of this section applies. (1) If the purpose of the Federal award is to assist the non-Federal enti- ty in the acquisition of equipment, 270 Dept. of Health and Human Services § 75.307 buildings or land, the aggregate value of the donated property may be claimed as cost sharing or matching. (2) If the purpose of the Federal award is to support activities that re- quire the use of equipment, buildings or land, normally only depreciation charges for equipment and buildings may be made. However, the fair market value of equipment or other capital as- sets and fair rental charges for land may be allowed, provided that the HHS awarding agency has approved the charges. See also § 75.420. (i) The value of donated property must be determined in accordance with the usual accounting policies of the non-Federal entity, with the fol arding agency has approved the charges. See also § 75.420. (i) The value of donated property must be determined in accordance with the usual accounting policies of the non-Federal entity, with the following qualifications: (1) The value of donated land and buildings must not exceed its fair mar- ket value at the time of donation to the non-Federal entity as established by an independent appraiser (e.g., cer- tified real property appraiser or Gen- eral Services Administration rep- resentative) and certified by a respon- sible official of the non-Federal entity as required by the Uniform Relocation Assistance and Real Property Acquisi- tion Policies Act of 1970, as amended, (42 U.S.C. 4601–4655) (Uniform Act) ex- cept as provided in the implementing regulations at 49 CFR part 24. (2) The value of donated equipment must not exceed the fair market value of equipment of the same age and con- dition at the time of donation. (3) The value of donated space must not exceed the fair rental value of com- parable space as established by an inde- pendent appraisal of comparable space and facilities in a privately-owned building in the same locality. (4) The value of loaned equipment must not ex of com- parable space as established by an inde- pendent appraisal of comparable space and facilities in a privately-owned building in the same locality. (4) The value of loaned equipment must not exceed its fair rental value. (j) For third-party in-kind contribu- tions, the fair market value of goods and services must be documented and to the extent feasible supported by the same methods used internally by the non-Federal entity. (k) For IHEs, see also OMB memo- randum M–01–06, dated January 5, 2001, Clarification of OMB A–21 Treatment of Voluntary Uncommitted Cost Shar- ing and Tuition Remission Costs. [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3016, Jan. 20, 2016] § 75.307 Program income. (a) General. Non-Federal entities are encouraged to earn income to defray program costs where appropriate. (b) Cost of generating program income. If authorized by Federal regulations or the Federal award, costs incidental to the generation of program income may be deducted from gross income to de- termine program income, provided these costs have not been charged to the Federal award. (c) Governmental revenues. Taxes, spe- cial assessments, levies, fines, and other such revenues raised b to de- termine program income, provided these costs have not been charged to the Federal award. (c) Governmental revenues. Taxes, spe- cial assessments, levies, fines, and other such revenues raised by a non- Federal entity are not program income unless the revenues are specifically identified in the Federal award or HHS awarding agency regulations as pro- gram income. (1) The Patent and Trademark Laws Amendments, 34 U.S.C. 200–212, apply to inventions made under an award for performance of experimental, develop- mental, or research work. (2) Unless the terms and conditions for the Federal award provide other- wise, recipients shall have no obliga- tion to HHS with respect to program income earned from license fees and royalties for copyrighted material, pat- ents, patent applications, trademarks, and inventions made under a Federal award. However, no scholarship, fellow- ship, training grant, or other funding agreement made primarily to a recipi- ent for educational purposes will con- tain any provision giving the HHS awarding agency rights to inventions made by the recipient. (d) Property. Proceeds from the sale of real property, equipment, or sup- plies, are not program income; tain any provision giving the HHS awarding agency rights to inventions made by the recipient. (d) Property. Proceeds from the sale of real property, equipment, or sup- plies, are not program income; such proceeds will be handled in accordance with the requirements of subpart D of this part, §§ 75.318, 75.320, and 75.321, or as specifically identified in Federal statutes, regulations, or the terms and conditions of the Federal award. (e) Use of program income. If the HHS awarding agency does not specify in its regulations or the terms and condi- tions of the Federal award, or give prior approval for how program income is to be used, paragraph (e)(1) of this section must apply. For Federal awards made to IHEs and nonprofit research institutions, if the HHS awarding agen- cy does not specify in its regulations or 271 § 75.308 45 CFR Subtitle A (10–1–24 Edition) the terms and conditions of the Federal award how program income is to be used, paragraph (e)(2) of this section must apply unless the recipient is sub- ject to conditions under § 75.207 or § 75.216. In specifying alternatives to paragraphs (e)(1) and (2) of this section, the HHS awarding agency may distin- guish between incom ss the recipient is sub- ject to conditions under § 75.207 or § 75.216. In specifying alternatives to paragraphs (e)(1) and (2) of this section, the HHS awarding agency may distin- guish between income earned by the re- cipient and income earned by sub- recipients and between the sources, kinds, or amounts of income. When the HHS awarding agency authorizes the approaches in paragraphs (e)(2) and (3) of this section, program income in ex- cess of any amounts specified must also be deducted from expenditures. (1) Deduction. Ordinarily program in- come must be deducted from total al- lowable costs to determine the net al- lowable costs. Program income must be used for current costs unless the HHS awarding agency authorizes otherwise. Program income that the non-Federal entity did not anticipate at the time of the Federal award must be used to re- duce the Federal award and non-Fed- eral entity contributions rather than to increase the funds committed to the project. (2) Addition. With prior approval of the HHS awarding agency (except for IHEs and nonprofit research institu- tions, as described in paragraph (e) of this section), program income may be added to the Federal award by the F or approval of the HHS awarding agency (except for IHEs and nonprofit research institu- tions, as described in paragraph (e) of this section), program income may be added to the Federal award by the Fed- eral agency and the non-Federal enti- ty. The program income must be used for the purposes and under the condi- tions of the Federal award. (3) Cost sharing or matching. With prior approval of the HHS awarding agency, program income may be used to meet the cost sharing or matching requirement of the Federal award. The amount of the Federal award remains the same. (f) Income after the period of perform- ance. There are no Federal require- ments governing the disposition of in- come earned after the end of the period of performance for the Federal award, unless the HHS awarding agency regu- lations or the terms and conditions of the award provide otherwise. The HHS awarding agency may negotiate agree- ments with recipients regarding appro- priate uses of income earned after the period of performance as part of the grant closeout process. See also § 75.381. (g) Unless the Federal statute, regu- lations, or terms and conditions for the Federal award provide otherwise, the non-Federal e performance as part of the grant closeout process. See also § 75.381. (g) Unless the Federal statute, regu- lations, or terms and conditions for the Federal award provide otherwise, the non-Federal entity has no obligation to the HHS awarding agency with respect to program income earned from license fees and royalties for copyrighted ma- terial, patents, patent applications, trademarks, and inventions made under a Federal award to which 37 CFR part 401, ‘‘Rights to Inventions Made by Nonprofit Organizations and Small Business Firms under Government Awards, Contracts and Cooperative Agreements’’ is applicable. [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3016, Jan. 20, 2016] § 75.308 Revision of budget and pro- gram plans. (a) The approved budget for the Fed- eral award summarizes the financial aspects of the project or program as ap- proved during the Federal award proc- ess. It may include either the Federal and non-Federal share (see § 75.2 Federal share) or only the Federal share, de- pending upon HHS awarding agency re- quirements. It must be related to per- formance for program evaluation pur- poses whenever appropriate. (b) Recipients are required to report deviations fr re, de- pending upon HHS awarding agency re- quirements. It must be related to per- formance for program evaluation pur- poses whenever appropriate. (b) Recipients are required to report deviations from budget or project scope or objective, and request prior approv- als from HHS awarding agencies for budget and program plan revisions, in accordance with this section. (c)(1) For non-construction Federal awards, recipients must request prior approvals from HHS awarding agencies for one or more of the following pro- gram or budget-related reasons: (i) Change in the scope or the objec- tive of the project or program (even if there is no associated budget revision requiring prior written approval). (ii) Change in a key person specified in the application or the Federal award. (iii) The disengagement from the project for more than three months, or a 25 percent reduction in time devoted to the project, by the approved project director or principal investigator. (iv) The inclusion, unless waived by the HHS awarding agency, of costs that require prior approval in accordance 272 Dept. of Health and Human Services § 75.308 with subpart E of this part, or appendix IX of this part, or 48 CFR pa ed by the HHS awarding agency, of costs that require prior approval in accordance 272 Dept. of Health and Human Services § 75.308 with subpart E of this part, or appendix IX of this part, or 48 CFR part 31, as ap- plicable. (v) The transfer of funds budgeted for participant support costs as defined in § 75.2 to other categories of expense. (vi) Unless described in the applica- tion and funded in the approved Fed- eral awards, the subawarding, transfer- ring or contracting out of any work under a Federal award, including fixed amount subawards as described in § 75.353. This provision does not apply to the acquisition of supplies, material, equipment or general support services. (vii) Changes in the approved cost- sharing or matching provided by the non-Federal entity. (viii) The need arises for additional Federal funds to complete the project. (ix) The inclusion of research patient care costs in research awards made for the performance of research work. (x) The provision of subawards by a pass-through entity on fixed amounts up to the Simplified Acquisition Threshold, provided that the subawards meet fixed requirements amount awards in § 75.201. See § 75.353. the for (xi) The recipi a pass-through entity on fixed amounts up to the Simplified Acquisition Threshold, provided that the subawards meet fixed requirements amount awards in § 75.201. See § 75.353. the for (xi) The recipient wishes to dispose of, replace, or encumber title to real property, equipment, or intangible property that are acquired or improved with a Federal award. See §§ 75.318, 75.320, 75.322, and 75.323. (2) No other prior approval require- ments for specific items may be im- posed unless an exception has been ap- proved by OMB. See also §§ 75.102 and 75.407. (d) Except for requirements listed in paragraph (c)(1) of this section, the HHS awarding agencies are authorized, at their option, to waive prior written approvals required by paragraph (c) this section. Such waivers may include authorizing recipients to do any one or more of the following: (1) Incur project costs 90 calendar days before the HHS awarding agency makes the Federal award. Expenses more than 90 calendar days pre-award require prior approval of the HHS awarding agency. All costs incurred be- fore the HHS awarding agency makes the Federal award are at the recipi- ent’s risk (i.e., the HHS awarding agen- cy is under no oblig prior approval of the HHS awarding agency. All costs incurred be- fore the HHS awarding agency makes the Federal award are at the recipi- ent’s risk (i.e., the HHS awarding agen- cy is under no obligation to reimburse such costs if for any reason the recipi- ent does not receive a Federal award or if the Federal award is less than antici- pated and inadequate to cover such costs). See also § 75.458. (2) Initiate a one-time extension of the period of performance by up to 12 months unless one or more of the con- ditions outlined in paragraphs (d)(2)(i) through (iii) of this section apply. For one-time extensions, the recipient must notify the HHS awarding agency in writing with the supporting reasons and revised period of performance at least 10 calendar days before the end of the period of performance specified in the Federal award. This one-time ex- tension may not be exercised merely for the purpose of using unobligated balances. Extensions require explicit prior HHS awarding agency approval when: (i) The terms and conditions of the Federal award prohibit the extension. (ii) The extension requires additional Federal funds. (iii) The extension involves any change in the approved o approval when: (i) The terms and conditions of the Federal award prohibit the extension. (ii) The extension requires additional Federal funds. (iii) The extension involves any change in the approved objectives or scope of the project. (3) Carry forward unobligated bal- ances to subsequent periods of perform- ance. (4) For Federal awards that support research, unless the HHS awarding agency provides otherwise in the Fed- eral award or in the HHS awarding agency’s regulations, the prior ap- proval requirements described in para- graph (d) are automatically waived (i.e., recipients need not obtain such prior approvals) unless one of the con- ditions included in paragraph (d)(2) ap- plies. (e) The HHS awarding agency may, at its option, restrict the transfer of funds among direct cost categories or programs, functions and activities for Federal awards in which the Federal share of the project exceeds the Sim- plified Acquisition Threshold and the cumulative amount of such transfers exceeds or is expected to exceed 10 per- cent of the total budget as last ap- proved by the HHS awarding agency. The HHS awarding agency cannot per- mit a transfer that would cause any Federal appropriation or is expected to exceed 10 per- cent of the total budget as last ap- proved by the HHS awarding agency. The HHS awarding agency cannot per- mit a transfer that would cause any Federal appropriation to be used for purposes other than those consistent with the appropriation. 273 § 75.309 45 CFR Subtitle A (10–1–24 Edition) (f) All other changes to non-construc- tion budgets, except for the changes de- scribed in paragraph (c) of this section, do not require prior approval (see also § 75.407). (g) For construction Federal awards, the recipient must request prior writ- ten approval promptly from the HHS awarding agency for budget revisions whenever paragraph (g)(1), (2), or (3) of this section applies. (1) The revision results from changes in the scope or the objective of the project or program. (2) The need arises for additional Federal funds to complete the project. (3) A revision is desired which in- volves specific costs for which prior written approval requirements may be imposed consistent with applicable OMB cost principles listed in subpart E of this part. (4) No other prior approval require- ments for budget revisions may be im- posed unless an exception has been ap- proved nsistent with applicable OMB cost principles listed in subpart E of this part. (4) No other prior approval require- ments for budget revisions may be im- posed unless an exception has been ap- proved by OMB. (5) When an HHS awarding agency makes a Federal award that provides support for construction and non-con- struction work, the HHS awarding agency may require the recipient to ob- tain prior approval from the HHS awarding agency before making any fund or budget transfers between the two types of work supported. (h) When requesting approval for budget revisions, the recipient must use the same format for budget infor- mation that was used in the applica- tion, unless the HHS awarding agency indicates a letter of request suffices. (i) Within 30 calendar days from the date of receipt of the request for budg- et revisions, the HHS awarding agency must review the request and notify the recipient whether the budget revisions have been approved. If the revision is still under consideration at the end of 30 calendar days, the HHS awarding agency must inform the recipient in writing of the date when the recipient may expect the decision. (j) All approvals granted in keeping with the prov at the end of 30 calendar days, the HHS awarding agency must inform the recipient in writing of the date when the recipient may expect the decision. (j) All approvals granted in keeping with the provisions of this section shall not be valid unless they are in writing, and signed by at least one of the fol- lowing HHS officials: (1) The Head of the HHS awarding agency that made the award or subor- dinate official with proper delegated authority from the Head, including the Head of the Regional Office of the HHS awarding agency that made the award; or (2) The responsible Grants Officer of the HHS awarding agency that made the award or an individual duly author- ized by the Grants Officer. [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3016, Jan. 20, 2016] § 75.309 Period of performance and availability of funds. (except as described (a) A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of per- formance in § 75.461) and any costs incurred before the HHS awarding agency or pass- through entity made the Federal award that were authorized by the Federal awarding agency or pass-through enti- ty. Funds available to pay allowable costs d red before the HHS awarding agency or pass- through entity made the Federal award that were authorized by the Federal awarding agency or pass-through enti- ty. Funds available to pay allowable costs during the period of performance include both Federal funds awarded and carryover balances. (b) A non-Federal entity must liq- uidate all obligations incurred under the award not later than 90 days after the end of the funding period (or as specified in a program regulation) to coincide with the submission of the final Federal Financial Report (FFR). This deadline may be extended with prior written approval from the HHS awarding agency. §§ 75.310–75.315 [Reserved] PROPERTY STANDARDS § 75.316 Purpose of property stand- ards. Sections 75.317 through 75.323 set forth uniform standards governing management and disposition of prop- erty furnished by HHS or whose cost was charged directly to a project sup- ported by an HHS award. The HHS awarding agency may not impose addi- tional requirements, unless specifically required to do so by Federal statute. The recipient may use its own property management standards and procedures provided they meet the provisions of these sections. 274 Dept. of He nless specifically required to do so by Federal statute. The recipient may use its own property management standards and procedures provided they meet the provisions of these sections. 274 Dept. of Health and Human Services § 75.319 § 75.317 Insurance coverage. The non-Federal entity must, at a minimum, provide the equivalent in- surance coverage for real property and equipment acquired or improved with Federal funds as provided to other property owned by the non-Federal en- tity. Federally-owned property need not be insured unless required by the terms and conditions of the Federal award. § 75.318 Real property. (a) Title. Subject to the obligations and conditions set forth in this section, title to real property acquired or im- proved under a Federal award will vest upon acquisition in the non-Federal en- tity. (b) Use. (1) Except as otherwise pro- vided by Federal statutes or by the HHS awarding agency, real property will be used for the originally author- ized purpose as long as needed for that purpose, during which time the non- Federal entity must not dispose of or encumber its title or other interests. (2) The non-Federal entity shall ob- tain written approval from the HHS a eded for that purpose, during which time the non- Federal entity must not dispose of or encumber its title or other interests. (2) The non-Federal entity shall ob- tain written approval from the HHS awarding agency for the use of real property in other federally-sponsored projects when the recipient determines that the property is no longer needed for the purpose of the original project. Use in other projects shall be limited to those under federally-sponsored projects (i.e., awards) or programs that have purpose consistent with those au- thorized for support by the HHS award- ing agency. (c) Disposition. When real property is no longer needed as provided in sub- section (b), the non-Federal entity must obtain disposition instructions from the HHS awarding agency or pass- through entity. The instructions must provide for one of the following alter- natives: (1) Retain title after compensating the HHS awarding agency. The amount paid to the HHS awarding agency will be computed by applying the HHS awarding agency’s percentage of par- ticipation in the cost of the original purchase (and costs of any improve- ments) to the fair market value of the property. However, in those situations ng the HHS awarding agency’s percentage of par- ticipation in the cost of the original purchase (and costs of any improve- ments) to the fair market value of the property. However, in those situations where the non-Federal entity is dis- posing of real property acquired or im- proved with a Federal award and ac- quiring replacement real property under the same Federal award, the net proceeds from the disposition may be used as an offset to the cost of the re- placement property. (2) Sell the property and compensate the HHS awarding agency. The amount due to the HHS awarding agency will be calculated by applying the HHS awarding agency’s percentage of par- ticipation in the cost of the original purchase (and cost of any improve- ments) to the proceeds of the sale after deduction of any actual and reasonable selling and fixing-up expenses. If the Federal award has not been closed out, the net proceeds from sale may be off- set against the original cost of the property. When the non-Federal entity is directed to sell property, sales proce- dures must be followed that provide for competition to the extent practicable and result in the highest possible re- turn. (3) Transfer title to th al entity is directed to sell property, sales proce- dures must be followed that provide for competition to the extent practicable and result in the highest possible re- turn. (3) Transfer title to the HHS award- ing agency or to a third party des- ignated/approved by the HHS awarding agency. The non-Federal entity is enti- tled to be paid an amount calculated by applying the non-Federal entity’s percentage of participation in the pur- chase of the real property (and cost of any improvements) to the current fair market value of the property. § 75.319 Federally-owned and exempt property. (a) Title to Federally-owned property remains vested in the Federal Govern- ment. The non-Federal entity must submit annually an inventory listing of Federally-owned property in its cus- tody to the HHS awarding agency. Upon completion of the Federal award or when the property is no longer need- ed, the non-Federal entity must report the property to the HHS awarding agency for further Federal agency uti- lization. (b) If the HHS awarding agency has no further need for the property, it must declare the property excess and report it for disposal to the appropriate Federal disposal authority, unless th - lization. (b) If the HHS awarding agency has no further need for the property, it must declare the property excess and report it for disposal to the appropriate Federal disposal authority, unless the HHS awarding agency has statutory authority to dispose of the property by alternative methods (e.g., the author- ity provided by the Federal Technology 275 § 75.320 45 CFR Subtitle A (10–1–24 Edition) Transfer Act (15 U.S.C. 3710 (i)) to do- nate research equipment to edu- cational and non-profit organizations in accordance with Executive Order 12999). The HHS awarding agency must issue appropriate instructions to the non-Federal entity. (c) Exempt Federally-owned property means property acquired under a Fed- eral award where the HHS awarding agency has chosen to vest title to the property to the non-Federal entity without further obligation to the Fed- eral Government, based upon the ex- plicit terms and conditions of the Fed- eral award. The HHS awarding agency may exercise this option when statu- tory authority exists. Absent statutory authority and specific terms and condi- tions of the Federal award, title to ex- empt Federally-owned property ac- quired under the Federal award r when statu- tory authority exists. Absent statutory authority and specific terms and condi- tions of the Federal award, title to ex- empt Federally-owned property ac- quired under the Federal award re- mains with the Federal Government. § 75.320 Equipment. See also § 75.439. (a) Title. Subject to the obligations and conditions set forth in this section, title to equipment acquired under a Federal award will vest upon acquisi- tion in the non-Federal entity. Unless a statute specifically authorizes the Federal agency to vest title in the non- Federal entity without further obliga- tion to the Federal Government, and the Federal agency elects to do so, the title must be a conditional title. Title must vest in the non-Federal entity subject to the following conditions: (1) Use the equipment for the author- ized purposes of the project during the period of performance, or until the property is no longer needed for the purposes of the project. (2) Not encumber the property with- out approval of the HHS awarding agency or pass-through entity. (3) Use and dispose of the property in accordance with paragraphs (b), (c) and (e) of this section. (b) A state must use, manage and dis- pose of al of the HHS awarding agency or pass-through entity. (3) Use and dispose of the property in accordance with paragraphs (b), (c) and (e) of this section. (b) A state must use, manage and dis- pose of equipment acquired under a Federal award by the state in accord- ance with state laws and procedures. Other non-Federal entities must follow paragraphs (c) through (e) of this sec- tion. (c) Use. (1) Equipment must be used by the non-Federal entity in the pro- gram or project for which it was ac- quired as long as needed, whether or not the project or program continues to be supported by the Federal award, and the non-Federal entity must not encumber the property without prior approval of the HHS awarding agency. When no longer needed for the original program or project, the equipment may be used in other activities supported by the HHS awarding agency, in the fol- lowing order of priority: (i) Activities under a Federal award from the HHS awarding agency which funded the original program or project, then (ii) Activities under Federal awards from other HHS awarding agencies. This includes consolidated equipment for information technology systems. (2) During the time that equipment is u or project, then (ii) Activities under Federal awards from other HHS awarding agencies. This includes consolidated equipment for information technology systems. (2) During the time that equipment is used on the project or program for which it was acquired, the non-Federal entity must also make the equipment available for use on other projects or programs currently or previously sup- ported by the Federal Government, provided that such use will not inter- fere with the work on the projects or program for which it was originally ac- quired. First preference for other use must be given to other programs or projects supported by the HHS award- ing agency that financed the equip- ment and second preference must be given to programs or projects under Federal awards from other Federal awarding agencies. Use for non-feder- ally-funded programs or projects is also permissible. User fees should be consid- ered if appropriate. (3) Notwithstanding the encourage- ment in § 75.307 to earn program in- come, the non-Federal entity must not use equipment acquired with the Fed- eral award to provide services for a fee that is less than private companies charge for equivalent services unless specific - come, the non-Federal entity must not use equipment acquired with the Fed- eral award to provide services for a fee that is less than private companies charge for equivalent services unless specifically authorized by Federal stat- ute for as long as the Federal Govern- ment retains an interest in the equip- ment. (4) When acquiring replacement equipment, the non-Federal entity may use the equipment to be replaced as a trade-in or sell the property and use the proceeds to offset the cost of the replacement property subject to the approval of the HHS awarding agency. 276 Dept. of Health and Human Services § 75.321 (d) Management requirements. Proce- dures for managing equipment (includ- ing replacement equipment), whether acquired in whole or in part under a Federal award, until disposition takes place will, as a minimum, meet the fol- lowing requirements: (1) Property records must be main- tained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, and cost of the property, percent- age of Federal participation in the project costs for the Fede r, the source of funding for the property (including the FAIN), who holds title, the acquisition date, and cost of the property, percent- age of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. (2) A physical inventory of the prop- erty must be taken and the results rec- onciled with the property records at least once every two years. (3) A control system must be devel- oped to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated. (4) Adequate maintenance procedures must be developed to keep the property in good condition. (5) If the non-Federal entity is au- thorized or required to sell the prop- erty, proper sales procedures must be established to ensure the highest pos- sible return. (e) Disposition. When original or re- placement equipment acquired under a Federal award is no longer needed for the original project or program or for other activities currently or previously supported by a HHS awarding agency, e or re- placement equipment acquired under a Federal award is no longer needed for the original project or program or for other activities currently or previously supported by a HHS awarding agency, except as otherwise provided in Federal statutes, regulations, or HHS awarding agency disposition instructions, the non-Federal entity must request dis- position instructions from the HHS awarding agency if required by the terms and conditions of the Federal award. Disposition of the equipment will be made as follows, in accordance with HHS awarding agency disposition instructions: (1) Items of equipment with a current per unit fair market value of $5,000 or less may be retained, sold or otherwise disposed of with no further obligation to the HHS awarding agency. (2) Except as provided in § 75.319(b), or if the HHS awarding agency fails to provide requested disposition instruc- tions within 120 days, items of equip- ment with a current per-unit fair-mar- ket value in excess of $5,000 may be re- tained by the non-Federal entity or sold. The HHS awarding agency is enti- tled to an amount calculated by multi- plying the current market value or proceeds from sale by the HHS award- ing agenc re- tained by the non-Federal entity or sold. The HHS awarding agency is enti- tled to an amount calculated by multi- plying the current market value or proceeds from sale by the HHS award- ing agency’s percentage of participa- tion in the cost of the original pur- chase. If the equipment is sold, the HHS awarding agency may permit the non-Federal entity to deduct and re- tain from the Federal share $500 or ten percent of the proceeds, whichever is less, for its selling and handling ex- penses. (3) The non-Federal entity may transfer title to the property to the Federal Government or to an eligible third party provided that, in such cases, the non-Federal entity must be entitled to compensation for its attrib- utable percentage of the current fair market value of the property. (4) In cases where a non-Federal enti- ty fails to take appropriate disposition actions, the HHS awarding agency may direct the non-Federal entity to take disposition actions. § 75.321 Supplies. See also § 75.453. (a) Title to supplies will vest in the non-Federal entity upon acquisition. If there is a residual inventory of unused supplies exceeding $5,000 in total aggre- gate value upon termination or com- 3. (a) Title to supplies will vest in the non-Federal entity upon acquisition. If there is a residual inventory of unused supplies exceeding $5,000 in total aggre- gate value upon termination or com- pletion of the project or program and the supplies are not needed for any other Federal award, the non-Federal entity must retain the supplies for use on other activities or sell them, but must, in either case, compensate the Federal Government for its share. The amount of compensation must be com- puted in the same manner as for equip- ment. See § 75.320(e)(2) for the calcula- tion methodology. (b) As long as the Federal Govern- ment retains an interest in the sup- plies, the non-Federal entity must not use supplies acquired under a Federal 277 § 75.322 45 CFR Subtitle A (10–1–24 Edition) award to provide services to other or- ganizations for a fee that is less than private companies charge for equiva- lent services, unless specifically au- thorized by Federal statute. § 75.322 Intangible property and copy- rights. (a) Title to intangible property (see § 75.2 Intangible property) acquired under a Federal award vests upon acquisition in the non-Federal entity. The non- Federal entity m property and copy- rights. (a) Title to intangible property (see § 75.2 Intangible property) acquired under a Federal award vests upon acquisition in the non-Federal entity. The non- Federal entity must use that property for the originally-authorized purpose, and must not encumber the property without approval of the HHS awarding agency. When no longer needed for the originally authorized purpose, disposi- tion of the intangible property must occur in accordance with the provi- sions in § 75.320(e). (b) The non-Federal entity may copy- right any work that is subject to copy- right and was developed, or for which ownership was acquired, under a Fed- eral award. The HHS awarding agency reserves a royalty-free, nonexclusive and irrevocable right to reproduce, publish, or otherwise use the work for Federal purposes, and to authorize oth- ers to do so. (c) The non-Federal entity is subject to applicable regulations governing patents and inventions, including gov- ernment-wide regulations issued by the Department of Commerce at 37 CFR part 401. (d) The Federal Government has the right to: (1) Obtain, reproduce, publish, or oth- erwise use the data produced under a Federal award; and (2) ssued by the Department of Commerce at 37 CFR part 401. (d) The Federal Government has the right to: (1) Obtain, reproduce, publish, or oth- erwise use the data produced under a Federal award; and (2) Authorize others to receive, repro- duce, publish, or otherwise use such data for Federal purposes (e) Freedom of Information Act (FOIA). (1) In response to a Freedom of Infor- mation Act (FOIA) request for research data relating to published research findings produced under a Federal award that were used by the Federal Government in developing an agency action that has the force and effect of law, the HHS awarding agency must re- quest, and the non-Federal entity must provide, within a reasonable time, the research data so that they can be made available to the public through the pro- cedures established under the FOIA. If the HHS awarding agency obtains the research data solely in response to a FOIA request, the HHS awarding agen- cy may charge the requester a reason- able fee equaling the full incremental cost of obtaining the research data. This fee should reflect costs incurred by the Federal agency and the non- Federal entity. This fee is in addition to any fees the HHS awarding the full incremental cost of obtaining the research data. This fee should reflect costs incurred by the Federal agency and the non- Federal entity. This fee is in addition to any fees the HHS awarding agency may assess under the FOIA (5 U.S.C. 552(a)(4)(A)). (2) Published research findings means when: (i) Research findings are published in a peer-reviewed scientific or technical journal; or (ii) A Federal agency publicly and of- ficially cites the research findings in support of an agency action that has the force and effect of law. ‘‘Used by the Federal Government in developing an agency action that has the force and effect of law’’ is defined as when an agency publicly and officially cites the research findings in support of an agen- cy action that has the force and effect of law. (3) Research data means the recorded factual material commonly accepted in the scientific community as necessary to validate research findings, but not any of the following: Preliminary anal- yses, drafts of scientific papers, plans for future research, peer reviews, or communications with colleagues. This ‘‘recorded’’ material excludes physical objects (e.g., laboratory samples). Re- search data also d f scientific papers, plans for future research, peer reviews, or communications with colleagues. This ‘‘recorded’’ material excludes physical objects (e.g., laboratory samples). Re- search data also do not include: (i) Trade secrets, commercial infor- mation, materials necessary to be held confidential by a researcher until they are published, or similar information which is protected under law; and (ii) Personnel and medical informa- tion and similar information the dis- closure of which would constitute a clearly unwarranted invasion of per- sonal privacy, such as information that could be used to identify a particular person in a research study. (f) The requirements set forth in paragraph (e)(1) of this section do not apply to commercial organizations [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3016, Jan. 20, 2016] 278 Dept. of Health and Human Services § 75.327 § 75.323 Property trust relationship. Real property, equipment, and intan- gible property, that are acquired or im- proved with a Federal award must be held in trust by the non-Federal entity as trustee for the beneficiaries of the project or program under which the property was acquired or improved. The HHS awardin roved with a Federal award must be held in trust by the non-Federal entity as trustee for the beneficiaries of the project or program under which the property was acquired or improved. The HHS awarding agency may require the non-Federal entity to record liens or other appropriate notices of record to indicate that personal or real prop- erty has been acquired or improved with a Federal award and that use and disposition conditions apply to the property. §§ 75.324–75.325 [Reserved] PROCUREMENT STANDARDS § 75.326 Procurements by states. When procuring property and serv- ices under a Federal award, a state must follow the same policies and pro- cedures it uses for procurements from its non-Federal funds. The state will comply with § 75.331 and ensure that every purchase order or other contract includes any clauses required by § 75.335. All other non-Federal entities, including subrecipients of a state, will follow §§ 75.327 through 75.335. § 75.327 General procurement stand- ards. (a) The non-Federal entity must use its own documented procurement pro- cedures which reflect applicable State, local, and tribal laws and regulations, provided that the procurements con- form to applicable non-Federal entity must use its own documented procurement pro- cedures which reflect applicable State, local, and tribal laws and regulations, provided that the procurements con- form to applicable Federal law and the standards identified in this part. (b) Non-Federal entities must main- tain oversight to ensure that contrac- tors perform in accordance with the terms, conditions, and specifications of their contracts or purchase orders. (c)(1) The non-Federal entity must maintain written standards of conduct covering conflicts of interest and gov- erning the actions of its employees en- gaged in the selection, award and ad- ministration of contracts. No em- ployee, officer, or agent may partici- pate in the selection, award, or admin- istration of a contract supported by a Federal award if he or she has a real or apparent conflict of interest. Such a conflict of interest would arise when the employee, officer, or agent, any member of his or her immediate fam- ily, his or her partner, or an organiza- tion which employs or is about to em- ploy any of the parties indicated here- in, has a financial or other interest in or a tangible personal benefit from a firm considered for a cont or an organiza- tion which employs or is about to em- ploy any of the parties indicated here- in, has a financial or other interest in or a tangible personal benefit from a firm considered for a contract. The of- ficers, employees, and agents of the non-Federal entity may neither solicit nor accept gratuities, favors, or any- thing of monetary value from contrac- tors or parties to subcontracts. How- ever, non-Federal entities may set standards for situations in which the financial interest is not substantial or the gift is an unsolicited item of nomi- nal value. The standards of conduct must provide for disciplinary actions to be applied for violations of such standards by officers, employees, or agents of the non-Federal entity. (2) If the non-Federal entity has a parent, affiliate, or subsidiary organi- zation that is not a state, local govern- ment, or Indian tribe, the non-Federal entity must also maintain written standards of conduct covering organi- zational conflicts of interest. Organiza- tional conflicts of interest means that because of relationships with a parent company, affiliate, or subsidiary orga- nization, the non-Federal entity is un- able or appears to be unabl st. Organiza- tional conflicts of interest means that because of relationships with a parent company, affiliate, or subsidiary orga- nization, the non-Federal entity is un- able or appears to be unable to be im- partial in conducting a procurement action involving a related organiza- tion. (d) The non-Federal entity’s proce- dures must avoid acquisition of unnec- essary or duplicative items. Consider- ation should be given to consolidating or breaking out procurements to ob- tain a more economical purchase. Where appropriate, an analysis will be made of lease versus purchase alter- natives, and any other appropriate analysis to determine the most eco- nomical approach. (e) To foster greater economy and ef- ficiency, and in accordance with efforts to promote cost-effective use of shared services across the Federal Govern- ment, the non-Federal entity is encour- aged to enter into state and local inter- governmental agreements or inter-en- tity agreements where appropriate for procurement or use of common or shared goods and services. 279 § 75.328 45 CFR Subtitle A (10–1–24 Edition) (f) The non-Federal entity is encour- aged to use Federal excess and surplus property in lieu of purch t or use of common or shared goods and services. 279 § 75.328 45 CFR Subtitle A (10–1–24 Edition) (f) The non-Federal entity is encour- aged to use Federal excess and surplus property in lieu of purchasing new equipment and property whenever such use is feasible and reduces project costs. (g) The non-Federal entity is encour- aged to use value engineering clauses in contracts for construction projects of sufficient size to offer reasonable op- portunities for cost reductions. Value engineering is a systematic and cre- ative analysis of each contract item or task to ensure that its essential func- tion is provided at the overall lower cost. (h) The non-Federal entity must award contracts only to responsible contractors possessing the ability to perform successfully under the terms and conditions of a proposed procure- ment. Consideration will be given to such matters as contractor integrity, compliance with public policy, record of past performance, and financial and technical resources. See also § 75.213. (i) The non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not nec- essarily limited to the following: r . See also § 75.213. (i) The non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not nec- essarily limited to the following: ra- tionale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. (j)(1) The non-Federal entity may use a time and materials type contract only after a determination that no other contract is suitable and if the contract includes a ceiling price that the contractor exceeds at its own risk. Time and materials type contract means a contract whose cost to a non- Federal entity is the sum of: (i) The actual cost of materials; and (ii) Direct labor hours charged at fixed hourly rates that reflect wages, general and administrative expenses, and profit. (2) Since this formula generates an open-ended contract price, a time-and- materials contract provides no positive profit incentive to the contractor for cost control or labor efficiency. There- fore, each contract must set a ceiling price that the contractor exceeds at its own risk. Further, the non-Federal en- tity awarding such a contract must as- sert a high degre labor efficiency. There- fore, each contract must set a ceiling price that the contractor exceeds at its own risk. Further, the non-Federal en- tity awarding such a contract must as- sert a high degree of oversight in order to obtain reasonable assurance that the contractor is using efficient meth- ods and effective cost controls. (k) The non-Federal entity alone must be responsible, in accordance with good administrative practice and sound business judgment, for the set- tlement of all contractual and adminis- trative issues arising out of procure- ments. These issues include, but are not limited to, source evaluation, pro- tests, disputes, and claims. These standards do not relieve the non-Fed- eral entity of any contractual respon- sibilities under its contracts. The HHS awarding agency will not substitute its judgment for that of the non-Federal entity unless the matter is primarily a Federal concern. Violations of law will be referred to the local, tribal, state, or Federal authority having proper juris- diction. (l) The type of procuring instruments used must be determined by the recipi- ent but shall be appropriate for the particular procurement and for pro- moting the best ity having proper juris- diction. (l) The type of procuring instruments used must be determined by the recipi- ent but shall be appropriate for the particular procurement and for pro- moting the best interest of the pro- gram or project involved. [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3016, Jan. 20, 2016] § 75.328 Competition. (a) All procurement transactions must be conducted in a manner pro- viding full and open competition con- sistent with the standards of this sec- tion. In order to ensure objective con- tractor performance and eliminate un- fair competitive advantage, contrac- tors that develop or draft specifica- tions, requirements, statements of work, or invitations for bids or re- quests for proposals must be excluded from competing for such procurements. Some of the situations considered to be restrictive of competition include but are not limited to: (1) Placing unreasonable require- ments on firms in order for them to qualify to do business; (2) Requiring unnecessary experience and excessive bonding; (3) Noncompetitive pricing practices between firms or between affiliated companies; (4) Noncompetitive contracts to con- sultants that are on retainer contracts; sary experience and excessive bonding; (3) Noncompetitive pricing practices between firms or between affiliated companies; (4) Noncompetitive contracts to con- sultants that are on retainer contracts; (5) Organizational conflicts of inter- est; 280 Dept. of Health and Human Services § 75.329 (6) Specifying only a ‘‘brand name’’ product instead of allowing ‘‘an equal’’ product to be offered and describing the performance or other relevant re- quirements of the procurement; and (7) Any arbitrary action in the pro- curement process. (b) The non-Federal entity must con- duct procurements in a manner that prohibits the use of statutorily or ad- ministratively imposed state, local, or tribal geographical preferences in the evaluation of bids or proposals, except in those cases where applicable Federal statutes expressly mandate or encour- age geographic preference. Nothing in this section preempts state licensing laws. When contracting for architec- tural and engineering (A/E) services, geographic location may be a selection criterion provided its application leaves an appropriate number of quali- fied firms, given the nature and size of the project, to compete for the con- tract. (c) Th raphic location may be a selection criterion provided its application leaves an appropriate number of quali- fied firms, given the nature and size of the project, to compete for the con- tract. (c) The non-Federal entity must have written procedures for procurement transactions. These procedures must ensure that all solicitations: (1) Incorporate a clear and accurate description of the technical require- ments for the material, product, or service to be procured. Such descrip- tion must not, in competitive procure- ments, contain features which unduly restrict competition. The description may include a statement of the quali- tative nature of the material, product or service to be procured and, when necessary, must set forth those min- imum essential characteristics and standards to which it must conform if it is to satisfy its intended use. De- tailed product specifications should be avoided if at all possible. When it is impractical or uneconomical to make a clear and accurate description of the technical requirements, a ‘‘brand name or equivalent’’ description may be used as a means to define the performance or other salient requirements of pro- curement. The specific features o ption of the technical requirements, a ‘‘brand name or equivalent’’ description may be used as a means to define the performance or other salient requirements of pro- curement. The specific features of the named brand which must be met by of- fers must be clearly stated; and (2) Identify all requirements which the offerors must fulfill and all other factors to be used in evaluating bids or proposals. (d) The non-Federal entity must en- sure that all prequalified lists of per- sons, firms, or products which are used in acquiring goods and services are cur- rent and include enough qualified sources to ensure maximum open and free competition. Also, the non-Federal entity must not preclude potential bid- ders from qualifying during the solici- tation period. § 75.329 Procurement procedures. The non-Federal entity must use one of the following methods of procure- ment. (a) Procurement by micro-purchases. Procurement by micro-purchase is the acquisition of supplies or services, the aggregate dollar amount of which does not exceed the micro-purchase thresh- old (See micro-purchase). To the extent practicable, the non-Federal entity must distribute micro-purchases equi- tably among qualif e dollar amount of which does not exceed the micro-purchase thresh- old (See micro-purchase). To the extent practicable, the non-Federal entity must distribute micro-purchases equi- tably among qualified suppliers. Micro- purchases may be awarded without so- liciting competitive quotations if the non-Federal entity considers the price to be reasonable. (b) Procurement by small purchase pro- cedures. Small purchase procedures are those relatively simple and informal procurement methods for securing services, supplies, or other property that do not cost more than the Sim- plified Acquisition Threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources. (c) Procurement by sealed bids (formal advertising). Bids are publicly solicited and a firm fixed price contract (lump sum or unit price) is awarded to the re- sponsible bidder whose bid, conforming with all the material terms and condi- tions of the invitation for bids, is the lowest in price. The sealed bid method is the preferred method for procuring construction, if the conditions in para- graph (c)(1) of this section apply. (1) In order for sealed bidding bids, is the lowest in price. The sealed bid method is the preferred method for procuring construction, if the conditions in para- graph (c)(1) of this section apply. (1) In order for sealed bidding to be conditions following the feasible, should be present: (i) A complete, adequate, and real- istic specification or purchase descrip- tion is available; (ii) Two or more responsible bidders are willing and able to compete effec- tively for the business; and 281 § 75.330 45 CFR Subtitle A (10–1–24 Edition) (iii) The procurement lends itself to a firm fixed price contract and the selec- tion of the successful bidder can be made principally on the basis of price. (2) If sealed bids are used, the fol- lowing requirements apply: (i) Bids must be solicited from an adequate number of known suppliers, providing them sufficient response time prior to the date set for opening the bids, for local, and tribal govern- ments, the invitation for bids must be publicly advertised; (ii) The invitation for bids, which will include any specifications and per- tinent attachments, must define the items or services in order for the bidder to properly respond; (iii) All bids will be opened at the time and r bids, which will include any specifications and per- tinent attachments, must define the items or services in order for the bidder to properly respond; (iii) All bids will be opened at the time and place prescribed in the invita- tion for bids, for local, and tribal gov- ernments, the bids must be opened pub- licly; (iv) A firm fixed price contract award will be made in writing to the lowest responsive and responsible bidder. Where specified in bidding documents, factors such as discounts, transpor- tation cost, and life cycle costs must be considered in determining which bid is lowest. Payment discounts will only be used to determine the low bid when prior experience indicates that such discounts are usually taken advantage of; and (v) Any or all bids may be rejected if there is a sound documented reason. (d) Procurement by competitive pro- posals. The technique of competitive proposals is normally conducted with more than one source submitting an offer, and either a fixed price or cost- reimbursement type contract is award- ed. It is generally used when conditions are not appropriate for the use of sealed bids. If this method is used, the following requirements apply: (1) Reque cost- reimbursement type contract is award- ed. It is generally used when conditions are not appropriate for the use of sealed bids. If this method is used, the following requirements apply: (1) Requests for proposals must be publicized and identify all evaluation factors and their relative importance. Any response to publicized requests for proposals must be considered to the maximum extent practical; (2) Proposals must be solicited from an adequate number of qualified sources; (3) The non-Federal entity must have a written method for conducting tech- nical evaluations of the proposals re- ceived and for selecting recipients; (4) Contracts must be awarded to the responsible firm whose proposal is most advantageous to the program, with price and other factors consid- ered; and (5) The non-Federal entity may use competitive proposal procedures for qualifications-based procurement of ar- chitectural/engineering (A/E) profes- sional services whereby competitors’ qualifications are evaluated and the most qualified competitor is selected, subject to negotiation of fair and rea- sonable compensation. The method, where price is not used as a selection factor, can only be used in procure- ed and the most qualified competitor is selected, subject to negotiation of fair and rea- sonable compensation. The method, where price is not used as a selection factor, can only be used in procure- ment of A/E professional services. It cannot be used to purchase other types of services though A/E firms are a po- tential source to perform the proposed effort. (e) [Reserved] (f) Procurement by noncompetitive pro- posals. Procurement by noncompetitive proposals is procurement through so- licitation of a proposal from only one source and may be used only when one or more of the following circumstances apply: (1) The item is available only from a single source; (2) The public exigency or emergency for the requirement will not permit a delay resulting from competitive solic- itation; (3) The HHS awarding agency or pass- through entity expressly authorizes noncompetitive proposals in response to a written request from the non-Fed- eral entity; or (4) After solicitation of a number of sources, competition is determined in- adequate. [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3016, Jan. 20, 2016] § 75.330 Contracting with small and minority businesses, women’s busi- ness enterprises s, competition is determined in- adequate. [79 FR 75889, Dec. 19, 2014, as amended at 81 FR 3016, Jan. 20, 2016] § 75.330 Contracting with small and minority businesses, women’s busi- ness enterprises, and labor surplus area firms. (a) The non-Federal entity must take all necessary affirmative steps to as- sure that minority businesses, women’s business enterprises, and labor surplus area firms are used when possible. (b) Affirmative steps must include: 282 Dept. of Health and Human Services § 75.333 (1) Placing qualified small and mi- nority businesses and women’s business enterprises on solicitation lists; (2) Assuring that small and minority businesses, and women’s business en- terprises are solicited whenever they are potential sources; (3) Dividing total requirements, when economically into smaller feasible, tasks or quantities to permit max- imum participation by small and mi- nority businesses, and women’s busi- ness enterprises; (4) Establishing delivery schedules, where the requirement permits, which encourage participation by small and minority businesses, and women’s busi- ness enterprises; (5) Using the services and assistance, as appropriate, of such organizations as t quirement permits, which encourage participation by small and minority businesses, and women’s busi- ness enterprises; (5) Using the services and assistance, as appropriate, of such organizations as the Small Business Administration and the Minority Business Development Agency of the Department of Com- merce; and (6) Requiring the prime contractor, if subcontracts are to be let, to take the affirmative steps listed in paragraphs (b)(1) through (5) of this section. § 75.331 Procurement of recovered ma- terials. A non-Federal entity that is a state agency or agency of a political subdivi- sion of a state and its contractors must comply with section 6002 of the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act. The requirements of Section 6002 include procuring only items des- ignated in guidelines of the Environ- mental Protection Agency (EPA) at 40 CFR part 247 that contain the highest percentage of recovered materials prac- ticable, consistent with maintaining a satisfactory level of competition, where the purchase price of the item exceeds $10,000 or the value of the quantity acquired during the preceding fiscal year exceeded $10,000; procuring sol taining a satisfactory level of competition, where the purchase price of the item exceeds $10,000 or the value of the quantity acquired during the preceding fiscal year exceeded $10,000; procuring solid waste management services in a manner that maximizes energy and re- source recovery; and establishing an af- firmative procurement program for procurement of recovered materials identified in the EPA guidelines. § 75.332 Contract cost and price. (a) The non-Federal entity must per- form a cost or price analysis in connec- tion with every procurement action in excess of the Simplified Acquisition Threshold including contract modifica- tions. The method and degree of anal- ysis is dependent on the facts sur- rounding the particular procurement situation, but as a starting point, the non-Federal entity must make inde- pendent estimates before receiving bids or proposals. (b) The non-Federal entity must ne- gotiate profit as a separate element of the price for each contract in which there is no price competition and in all cases where cost analysis is performed. To establish a fair and reasonable prof- it, consideration must be given to the complexity of the work to be per- formed, the s no price competition and in all cases where cost analysis is performed. To establish a fair and reasonable prof- it, consideration must be given to the complexity of the work to be per- formed, the risk borne by the con- tractor, the contractor’s investment, the amount of subcontracting, the quality of its record of past perform- ance, and industry profit rates in the surrounding geographical area for similar work. (c) Costs or prices based on estimated costs for contracts under the Federal award are allowable only to the extent that costs incurred or cost estimates included in negotiated prices would be allowable for the non-Federal entity under subpart E of this part. The non- Federal entity may reference its own cost principles that comply with the Federal cost principles. (d) The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used. § 75.333 HHS awarding agency or pass- through entity review. (a) The non-Federal entity must make available, upon request of the HHS awarding agency or pass-through entity, technical specifications on pro- posed procurements where the HHS awarding agency or pass-through enti- ty believes such r ke available, upon request of the HHS awarding agency or pass-through entity, technical specifications on pro- posed procurements where the HHS awarding agency or pass-through enti- ty believes such review is needed to en- sure that the item or service specified is the one being proposed for acquisi- tion. This review generally will take place prior to the time the specifica- tion is incorporated into a solicitation document. However, if the non-Federal entity desires to have the review ac- complished after a solicitation has been developed, the HHS awarding agency or pass-through entity may 283 § 75.334 45 CFR Subtitle A (10–1–24 Edition) still review the specifications, with such review usually limited to the technical aspects of the proposed pur- chase. (b) The non-Federal entity must make available upon request, for the HHS awarding agency or pass-through entity pre-procurement review, pro- curement documents, such as requests for proposals or invitations for bids, or independent cost estimates, when: (1) The non-Federal entity’s procure- ment procedures or operation fails to comply with the procurement stand- ards in this part; (2) The procurement is expected to exceed the Sim ost estimates, when: (1) The non-Federal entity’s procure- ment procedures or operation fails to comply with the procurement stand- ards in this part; (2) The procurement is expected to exceed the Simplified Acquisition Threshold and is to be awarded without competition or only one bid or offer is received in response to a solicitation; (3) The procurement, which is ex- pected to exceed the Simplified Acqui- sition Threshold, specifies a ‘‘brand name’’ product; (4) The proposed contract is more than the Simplified Acquisition Threshold and is to be awarded to other than the apparent low bidder under a sealed bid procurement; or (5) A proposed contract modification changes the scope of a contract or in- creases the contract amount by more than the Simplified Acquisition Threshold. (c) The non-Federal entity is exempt from the pre-procurement review in paragraph (b) of this section if the HHS awarding agency or pass-through enti- ty determines that its procurement systems comply with the standards of this part. (1) The non-Federal entity may re- quest that its procurement system be reviewed by the HHS awarding agency or pass-through entity to determine whether its system meets these standards of this part. (1) The non-Federal entity may re- quest that its procurement system be reviewed by the HHS awarding agency or pass-through entity to determine whether its system meets these stand- ards in order for its system to be cer- tified. Generally, these reviews must occur where there is continuous high- dollar funding, and third party con- tracts are awarded on a regular basis; (2) The non-Federal entity may self- certify its procurement system. Such self-certification must not limit the HHS awarding agency’s right to survey the system. Under a self-certification procedure, the HHS awarding agency may rely on written assurances from the non-Federal entity that it is com- plying with these standards. The non- Federal entity must cite specific poli- cies, procedures, regulations, or stand- ards as being in compliance with these requirements and have its system available for review. § 75.334 Bonding requirements. For construction or facility improve- ment contracts or subcontracts exceed- ing the Simplified Acquisition Thresh- old, the HHS awarding agency or pass- through entity may accept the bonding policy and requirements of the non- Federal entity provided that t bcontracts exceed- ing the Simplified Acquisition Thresh- old, the HHS awarding agency or pass- through entity may accept the bonding policy and requirements of the non- Federal entity provided that the HHS awarding agency or pass-through enti- ty has made a determination that the Federal interest is adequately pro- tected. If such a determination has not been made, the minimum requirements must be as follows: (a) A bid guarantee from each bidder equivalent to five percent of the bid price. The ‘‘bid guarantee’’ must con- sist of a firm commitment such as a bid bond, certified check, or other ne- gotiable instrument accompanying a bid as assurance that the bidder will, upon acceptance of the bid, execute such contractual documents as may be required within the time specified. (b) A performance bond on the part of the contractor for 100 percent of the contract price. A ‘‘performance bond’’ is one executed in connection with a contract to secure fulfillment of all the contractor’s obligations under such contract. (c) A payment bond on the part of the contractor for 100 percent of the con- tract price. A ‘‘payment bond’’ is one executed in connection with a contract to assure payment tions under such contract. (c) A payment bond on the part of the contractor for 100 percent of the con- tract price. A ‘‘payment bond’’ is one executed in connection with a contract to assure payment as required by law of all persons supplying labor and ma- terial in the execution of the work pro- vided for in the contract. (d) Where bonds are required in the situations described herein, the bonds shall be obtained from companies hold- ing certificates of authority as accept- able sureties pursuant to 31 CFR part 223. § 75.335 Contract provisions. The non-Federal entity’s contracts must contain the applicable provisions described in appendix II to this part. 284 Dept. of Health and Human Services § 75.342 §§ 75.336–75.340 [Reserved] PERFORMANCE AND FINANCIAL MONITORING AND REPORTING § 75.341 Financial reporting. Unless otherwise approved by OMB, the HHS awarding agency may solicit only the standard, OMB-approved gov- ernment-wide data elements for collec- tion of financial information (at time of publication the Federal Financial Report or such future collections as may be approved by OMB and listed on the OMB Web site). This information must be collected with the frequency require (at time of publication the Federal Financial Report or such future collections as may be approved by OMB and listed on the OMB Web site). This information must be collected with the frequency required by the terms and conditions of the Federal award, but no less fre- quently than annually nor more fre- quently than quarterly except in un- usual circumstances, for example where more frequent reporting is nec- essary for the effective monitoring of the Federal award or could signifi- cantly affect program outcomes, and preferably in coordination with per- formance reporting. § 75.342 Monitoring and reporting pro- gram performance. (a) Monitoring by the non-Federal enti- ty. The non-Federal entity is respon- sible for oversight of the operations of the Federal award supported activities. The non-Federal entity must monitor its activities under Federal awards to assure compliance with applicable Fed- eral requirements and performance ex- pectations are being achieved. Moni- toring by the non-Federal entity must cover each program, function or activ- ity. See also § 75.352. (b) Non-construction performance re- ports. The HHS awarding agency must use standard, OMB-approved data ele- men non-Federal entity must cover each program, function or activ- ity. See also § 75.352. (b) Non-construction performance re- ports. The HHS awarding agency must use standard, OMB-approved data ele- ments for collection of performance in- formation performance (including progress reports, Research Perform- ance Progress Report, or such future collections as may be approved by OMB and listed on the OMB Web site). (1) The non-Federal entity must sub- mit performance reports at the inter- val required by the HHS awarding agency or pass-through entity to best inform improvements in program out- comes and productivity. Intervals must be no less frequent than annually nor more frequent than quarterly except in unusual circumstances, for example where more frequent reporting is nec- essary for the effective monitoring of the Federal award or could signifi- cantly affect program outcomes. An- nual reports must be due 90 calendar days after the reporting period; quar- terly or semiannual reports must be due 30 calendar days after the report- ing period. Alternatively, the HHS awarding agency or pass-through enti- ty may require annual reports before the anniversary dates of multiple year Fede must be due 30 calendar days after the report- ing period. Alternatively, the HHS awarding agency or pass-through enti- ty may require annual reports before the anniversary dates of multiple year Federal awards. The final performance report will be due 90 calendar days after the period of performance end date. If a justified request is submitted by a non-Federal entity, the HHS awarding agency may extend the due date for any performance report. (2) The non-Federal entity must sub- mit performance reports using OMB- approved government-wide standard in- formation collections when providing performance information. As appro- priate in accordance with the above- mentioned collections, information these reports will contain, for each Federal award, brief information on the following unless other collections are approved by OMB: (i) A comparison of actual accom- plishments to the objectives of the Federal award established for the pe- riod. Where the accomplishments of the Federal award can be quantified, a computation of the cost (for example, related to units of accomplishment) may be required if that information will be useful. Where performance trend data and analysis would be in- f be quantified, a computation of the cost (for example, related to units of accomplishment) may be required if that information will be useful. Where performance trend data and analysis would be in- formative to the HHS awarding agency program, the HHS awarding agency should include this as a performance reporting requirement. (ii) The reasons why established goals were not met, if appropriate. (iii) Additional pertinent information including, when appropriate, analysis and explanation of cost overruns or high unit costs. (c) Construction performance reports. For the most part, onsite technical in- spections and certified percentage of completion data are relied on heavily by HHS awarding agencies and pass- through entities to monitor progress under Federal awards and subawards for construction. The HHS awarding 285 § 75.343 45 CFR Subtitle A (10–1–24 Edition) agency may require additional per- formance reports only when considered necessary. (d) Significant developments. Events may occur between the scheduled per- formance reporting dates that have sig- nificant impact upon the supported ac- tivity. In such cases, the non-Federal entity must inform the HHS awarding agency or pass- cur between the scheduled per- formance reporting dates that have sig- nificant impact upon the supported ac- tivity. In such cases, the non-Federal entity must inform the HHS awarding agency or pass-through entity as soon as the following types of conditions be- come known: (1) Problems, delays, or adverse con- ditions which will materially impair the ability to meet the objective of the Federal award. This disclosure must in- clude a statement of the action taken, or contemplated, and any assistance needed to resolve the situation. (2) Favorable developments which en- able meeting time schedules and objec- tives sooner or at less cost than antici- pated or producing more or different beneficial than originally planned. results (e) The HHS awarding agency may make site visits as warranted by pro- gram needs. (f) The HHS awarding agency may waive any performance report required by this part if not needed. § 75.343 Reporting on real property. The HHS awarding agency or pass- through entity must require a non-Fed- eral entity to submit reports at least annually on the status of real property in which the Federal Government re- tains an interest, unless the Federal in- terest in the r