Federal Assistance Manual

Updated August 4, 2021
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Annex A: Table of Contents

TABLE OF CONTENTS

Definitions

Acronyms

Part 1 – Requirements for All OSMRE Assistance Agreements

• Chapter 1-100 - Describing the Federal Assistance Manual

• Chapter 1-110 - OSMRE Responsibilities for the Administration of Our Assistance

• Chapter 1-120 - Assistance Agreement Applications and Awards

• Chapter 1-130 - Assistance Agreement Conditions and Award Documents

• Chapter 1-140 - Assistance Agreement Numbering and Files Organization

• Chapter 1-150 - Monitoring and Technical Assistance

• Chapter 1-160 - Drawdown Analysis

• Chapter 1-170 - Overdue Reports

• Chapter 1-180 - Audit Resolution and Cost Disallowances

Part 2 – General Requirements for Federal Assistance

• Chapter 2-100 - Using Contracts, Grants, and Cooperative Agreements

• Chapter 2-110 - Debarment and Suspension

• Chapter 2-120 - Drug-Free Workplace Requirements

• Chapter 2-130 - Lobbying

• Chapter 2-140 - Intergovernmental Review of Federal Programs

• Chapter 2-150 - Anti-Discrimination in Federally Assisted Programs

• Chapter 2-200 - Property

• Chapter 2-210 - Program Income

• Chapter 2-220 - Matching and Cost Sharing

• Chapter 2-230 - Procurement Guidelines

• Chapter 2-240 - Financial Management Systems

• Chapter 2-250 - Supporting Documentation and Accounting Files

• Chapter 2-260 - Records Retention and Access

• Chapter 2-270 - Enforcing and Terminating Assistance Agreements

Part 3 – Allowable Costs

• Chapter 3-100 - Cost Principles

• Chapter 3-110 - Indirect Cost Rates

• Chapter 3-120 - Subgrants and Transferring Work

• Chapter 3-130 - Leased Facilities or Equipment

• Chapter 3-140 - Purchasing, Constructing, and Renovating Buildings
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Part 4 - Abandoned Mine Lands (AML) Grant Program

• Chapter 4-100 - AML Activities for Uncertified Programs

• Chapter 4-110 - Annual Distribution of Title IV Grant Funds

• Chapter 4-120 - State Emergency AML Reclamation Program

• Chapter 4-130 - Acid Mine Drainage Set-Aside Program

• Chapter 4-140 - AML Special Future Set-Aside Program

• Chapter 4-150 - AML Subsidence Insurance Program

• Chapter 4-160 - Environmental Compliance

• Chapter 4-170 - The Authorization to Proceed Process

• Chapter 4-200 - The Application Process for an AML Grant

• Chapter 4-210 - Application Review and Processing for an AML Grant

• Chapter 4-220 - Amendments and Post-Award Changes for an AML Grant

• Chapter 4-230 - Performance and Financial Reporting for an AML Grant

• Chapter 4-240 - Closing an AML Grant

• Chapter 4-300 - Title IV Grant Procedures for Certified Programs

• Chapter 4-400 - Procedures for Civil Penalty Grants

• Chapter 4-500 – Subaccounts and Fund Types

Part 5 - Regulatory Grant Program

• Chapter 5-100 - Regulatory Programs Overview

• Chapter 5-110 - Regulatory Administration and Enforcement Grants

• Chapter 5-120 - Funding for State Regulation on Federal Lands

• Chapter 5-130 - Small Operator Assistance Program (SOAP) Grants

• Chapter 5-200 - The Application Process for a Regulatory Grant

• Chapter 5-210 - Application Review and Processing for a Regulatory Grant

• Chapter 5-220 - Amendments and Post-Award Changes for a Regulatory Grant

• Chapter 5-230 - Performance and Financial Reporting for a Regulatory Grant

• Chapter 5-240 - Closing a Regulatory Grant

Part 6 - Watershed Cooperative Agreement Program

• Chapter 6-100 - Watershed Cooperative Agreement Program

• Chapter 6-200 - The Application Process for a Watershed Cooperative Agreement

• Chapter 6-210 - Application Review and Processing for a Watershed Cooperative 

Agreement

• Chapter 6-220 - Amendments and Post-Award Changes for a Watershed 

Cooperative Agreement

• Chapter 6-230 - Performance and Financial Reporting for a Watershed 

Cooperative Agreement

• Chapter 6-240 - Closing a Watershed Cooperative Agreement
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Part 7 - Technical Studies Cooperative Agreement Programs

• Chapter 7-100 - Technical Studies Program Overview

• Chapter 7-110 - Applied Science Cooperative Agreements

• Chapter 7-120 - Underground Mine Map Cooperative Agreements

• Chapter 7-210 - Application Review and Processing for a Technical Studies 

Program Cooperative Agreement

• Chapter 7-220 - Amendments and Post Award Changes for a Technical Studies 

Program Cooperative Agreement

• Chapter 7-230 - Performance and Financial Reporting for a Technical Studies 

Program Cooperative Agreement

• Chapter 7-240 - Closing a Technical Studies Program Applied Science 

Cooperative Agreement

• Chapter 7-250 - Closing a Technical Studies Program Underground Mine Map 

Cooperative Agreement
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Annex B: Definitions

DEFINITIONS

Accounting System – Method for the separate identification of receipts, disbursements, assets 

and liabilities, and for the summarization of financial information in a manner which will enable 

the recipient to prepare the reports required by the Federal agency for an assistance agreement.

Accrual Basis – Accounting basis which recognizes transactions when they occur, regardless of 

the timing of related cash receipts and payments.

Acquisition Cost - The net invoice price of purchased property, including any attachments or 

accessories needed to make the property usable for the purpose for which it was acquired. 

Related charges such as taxes, freight, or installation should be included or excluded from 

acquisition cost in accordance with the recipient’s regular accounting practices.

Administratively Complete – The determination we make that all required parts of an 

assistance application are present and that sufficient information is provided to determine that 

costs are necessary reasonable, allowable, and allocable.

Alterations and Renovations - Work required to change the physical characteristics of an 

existing facility or installed equipment as needed by the program to make it more useful for its 

current purpose or adapt it to a changed use.

Amendment – A formal written change to the amount, terms and conditions, performance 

period or scope of work of an assistance agreement.

Appeal Procedures – Procedures which permit an applicant or recipient to request review of a 

particular issue or decision at a higher level. Appeals of OSMRE decisions are submitted to the 

appropriate Regional Director or to the Director of OSMRE.

Applicable Credit – A negative expenditure item which offsets or reduces an expense. 

Examples are purchase discounts, rebates, trade-ins, and adjustments of overpayments and 

erroneous charges.

Approval Package – The set of documents related to an assistance agreement application which 

is prepared by the grants specialist to justify and support the approval recommendation made to 

the official authorized to approve the award.

Assistance Agreement – A grant or cooperative agreement awarded by a Federal agency to 

provide financial assistance to a recipient.

Audit – A formal review to verify and assess an organization’s financial and programmatic 

operations.
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Awarding Office – The OSMRE Regional, Field, or Area office or offices which award and 

manage a recipient’s assistance agreement.

Budget – The approved financial plan for both Federal and non-Federal funds to carry out the 

purpose of the assistance agreement. This plan is the financial expression of the project or 

program as approved during the application and award process.

Budget Revision – A change to an assistance agreement budget approved by the Federal agency 

as needed to carry out the purposes of the project.

Budget Underrun – The amount of Federal funds awarded exceeds the needs of the recipient by 

more than $10,000 or ten percent of the total agreement amount, whichever is greater. The 

recipient must notify the Federal agency promptly when a budget underrun is expected to occur.

Cash Basis – Accounting basis which recognizes transactions only when cash changes hands.

Catalog of Federal Domestic Assistance (CFDA) – A comprehensive listing and description of 

Federal programs and activities which provide financial assistance or benefits to the public.

Certified State or Tribe – A state or tribe in which the Governor or Tribal governing body has 

certified and the Secretary has concurred that the state (or Indian tribe) has reclaimed and 

achieved all of the priorities for abandoned coal mines and other affected lands that existed prior 

to 1977.

Closeout – Completion by the recipient and Federal agency of all appropriate final actions for an 

assistance agreement except audit.

Conflict of Interest – Outside activities, relationships, or financial interests of a recipient or an 

employee which may lead the entity to be motivated, or to give the appearance of being 

motivated, by a desire for private gain. 

Consultant – A person engaged to give professional advice or services for a fee, but not as an 

employee of the paying organization.

Cooperative Agreement – An agreement between a Federal agency and a recipient to provide 

funds to achieve a specified public purpose of support or stimulation, authorized by Federal 

statute, with significant Federal involvement in performance.

Cost Analysis – The process of obtaining cost breakdowns, examining or verifying cost data, 

and evaluating specific elements of costs to determine that costs in an assistance agreement 

budget are necessary, reasonable, and appropriate.
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Cost Principles – The principles published in OMB regulations which Federal agencies use to 

determine whether costs are allowable in Federal assistance agreements.

Cost Transfers – The reassignment of costs from one project activity to another.

Costs – The allowable direct costs of an assistance agreement activity, plus the allocable 

portions of the allowable indirect costs of an organization, less allocable credits.

Debarment – The exclusion of a person or entity from participating in covered Federal 

transactions, following proper notification, hearing and appeal procedures.

Deviation from Policy – The use of any policy, procedure, form or condition which is 

inconsistent with agency policy, or the failure to use a prescribed policy, procedure, form, or 

condition for an assistance agreement.

Direct Costs – Costs that can be identified specifically to a particular program or cost objective.

Disbursements – Payments in cash or by check or electronic funds transfer.

Discretionary Grants – Programs that permit Federal agencies, under specific authorizing 

legislation, to use a competitive process to select the projects and entities to receive Federal 

financial assistance.

Distribution – The process the Federal agency uses to divide funding available for a mandatory 

grant program between the eligible program recipients.

Environmental Impact – The probable environmental consequences of any major Federal 

action.

Equal Employment Opportunity – Non-discrimination against any person in recruitment, 

examination, appointment, training, promotion, retention, and discipline because of political or 

religious opinions or affiliations, or because of race, national origin, or other nonmerit factors.

Equipment – Tangible personal property having a useful life of more than one year and an 

acquisition cost of $5,000 or more per unit. See Property.

Expiration Date – The ending date of the performance period of an assistance agreement.

Extension – Delay the date of an action. Change the ending date of an assistance agreement to 

provide additional time to complete the program activity. Change the due date to provide 

additional time to complete a required action such as a report.

Federal Reclamation Program Project – Emergency or high priority AML abatement or 

reclamation project undertaken by OSMRE on lands and waters not under an approved state or 
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Tribal reclamation or emergency program. Reclamation may be funded through a Federal 

contract, a cooperative agreement with a state or tribe, or an interagency agreement with another 

Federal agency.

Federal Share – The percentage of the total net cost of an activity paid with Federal assistance 

funds. The Federal cost share percentage can also be applied to property or income to determine 

the Federal share of assets.

Federally-Recognized Indian Tribal Government – The governing body or a governmental 

agency of any Indian tribe, band, nation, or other organized group or community certified by the 

Secretary of the Interior as eligible for the special programs and services provided through the 

Bureau of Indian Affairs.

Forms Clearance – Process for a Federal agency to obtain prior clearance from OMB in order to 

require multiple non-Federal entities to complete a form or respond to an information request. 

Freedom of Information Act (FOIA) – Law governing the release of certain requested 

information to any member of the public.

Grant – An award of financial assistance from a Federal agency to a recipient to achieve a 

specified public purpose of support or stimulation, authorized by Federal statute, where agency 

involvement in the project is expected to be minimal.

Grantee – Organization or entity receiving a grant. See Recipient.

Indirect Costs – Costs incurred by an organization for a common or joint purpose benefiting 

more than one cost objective or program and not readily assignable to the cost objective 

specifically benefited.

In-Kind – Contributions other than cash, such as goods and services or the use of real or 

personal property, made by the recipient or by third parties directly benefiting and specifically 

identifiable to the assistance program activity.

Lobbying – Any activity designed to influence a member of Congress to favor or oppose any 

legislation, including appropriation, whether before or after the introduction of any bill or 

resolution proposing such legislation.

Mandatory Grants – Grants that a Federal agency must award to all entities which meet the 

eligibility and compliance requirements of the authorizing law and regulations.

Match – Level of non-Federal support, cash or in-kind, a recipient is required by law or 

regulations to provide to be eligible for an assistance agreement under a specific program.
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Obligations – Legal commitment by an organization which binds funds for payment, such as the 

award of an assistance agreement or a contract.

Office of Management and Budget (OMB) – The principal staff office in the Office of the 

President for administrative and financial matters.

Outlays – Costs charged to the assistance agreement.

Payment – Federal funds transferred to recipients by electronic fund transfer. Payments may be 

in advance of cash outlays by the recipient or reimbursements of previous outlays from the 

recipient’s own cash.

Performance Period – The period of time when the recipient is authorized under an assistance 

agreement to perform the supported program and charge its costs to the agreement.

Pre-award Costs – Expenses incurred by an applicant prior to the award of the assistance 

agreement.

Privacy Act of 1974 – Law mandating that personal information about individuals collected by 

Federal agencies be limited to that which is legally authorized and necessary. Personal 

information must be maintained, used and disseminated so as to prevent unwarranted intrusions 

upon individual privacy.

Prior Approval – Written agreement by an authorized Federal official to a recipient’s request to 

change the project or assistance agreement. The recipient must receive the approval before they 

take the action.

Program Income – Gross earnings directly generated from activities supported by an assistance 

agreement.

Project – An AML project is an area containing one or more abandoned mine land problems. A 

project may be a group of related reclamation activities with a common objective within a 

political subdivision of a state or within a logical geographic area such as a watershed, 

conservation district or county planning area.

Property

a. Real property – land, land improvements, buildings, facilities and related minor property 

and gear, excluding movable machinery and equipment.

b. Personal property – property of any kind except real property.

c. Tangible personal property – personal property having physical existence.
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d. Intangible personal property – personal property without physical existence, such as 

patents, inventions, and copyrights.

e. Expendable personal property - personal property other than equipment.

f. Nonexpendable personal property - tangible personal property with a useful life of more 

than one year.

NOTE: A recipient may use its own definition of property provided that its definition 

would at least include all property as defined above.

Recipient – The organization or individual entity that receives an assistance agreement and 

assumes legal and financial responsibility and accountability both for the awarded funds and for 

the performance of the supported activity.

Regulations – Governmental orders having the force of law. Regulations are published in the 

Federal Register and the Code of Federal Regulations (CFR) as the official notification to the 

public of the implementation of a program or the establishment of rules or procedures.

Scope Change – A programmatic change in the work to be performed under an assistance 

agreement that is outside the range of work contemplated at the time of award.

Site Visit – Meeting or review by Federal program, grants or management staff or consultants at 

a recipient’s office or at the site of any activity supported by the assistance agreement.

State – Any of the states of the United States, the District of Columbia, Puerto Rico, any 

territory or possession of the United States, or any instrumentality of a state, including state 

institutions of higher education and hospitals, but not including the governments of the political 

subdivisions of the state.

State Plan – Proposal to establish a regulatory or reclamation program under the Surface Mining 

Control and Reclamation Act (SMCRA) submitted by an eligible state or tribe and approved by 

the Secretary of the Interior.

Subgrant – An award by a recipient to an eligible third party of financial assistance in money or 

property from an assistance agreement. The term does not include procurement purchases or 

contracts made by a recipient.

Supplies – Expendable personal property.

Suspension – A Federal action which temporarily halts operations under an assistance agreement 

because of a problem. Suspension allows time for corrective action by the recipient or the 

Federal agency’s decision to terminate the agreement.
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Technical Assistance – Advice or training provided by the Federal agency or staff to increase 

the effectiveness of the recipient’s program and/or administrative staff.

Termination – Cancellation, in whole or in part, of Federal support under an assistance 

agreement prior to completion or the approved expiration date of the agreement. 

Uncertified State or Tribe – A state or tribe that has not yet reclaimed all lands and water that 

were either mined for coal or affected by coal mining and abandoned or left in an inadequate 

reclamation status prior to 1977.

Unobligated Balance – The portion of the total authorized funding which remains available to 

incur additional costs for the program.

Unpaid Obligations – Transactions for goods or services the recipient has committed to pay for 

but has not yet paid, whether or not the goods or a bill have been received.
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Annex C: Acronyms, Abbreviations, and Initialisms 

ACRONYMS, ABBREVIATIONS AND INITIALISMS 

USED IN THE FEDERAL ASSISTANCE MANUAL

A&E Administration and Enforcement

ACH Automated Clearinghouse

AD-F&A Assistant Director, Finance and Administration

AD-PS Assistant Director, Program Support

AMD Acid Mine Drainage

AML Abandoned Mine Land

AR Appalachian Regional Office

ASAP Automated Standard Application for Payments

ATP Authorization to Proceed

AVS Applicant Violator System

CE Categorical Exclusion

CFR Code of Federal Regulations

CSP Clean Streams Program

DD Deputy Director

DFM Division of Financial Management

DOI Department of the Interior

DRS Division of Reclamation Support

e-AMLIS Enhanced Abandoned Mine Land Inventory System

EIS Environmental Impact Statement

EFT Electronic Funds Transfer

EPA Environmental Protection Agency

EPLS Excluded Parties List System

FAADS Federal Assistance Award Data System

FAM Federal Assistance Manual

FBMS Financial and Business Management System

FE Account code for Federal Expense Funds and Minimum Program Make-Up Funds

FMFIA Federal Managers’ Financial Integrity Act

FO Field Office

FOD Field Office Director

FONSI Finding of No Significant Impacts

GMT Grants Management

HC Account code for Historic Coal Funds

HU Account code for Prior Balance Replacement Funds

IMCC Interstate Mining Compact Commission

MCR Mid-Continent Region

MSHA Mine Safety and Health Administration, Department of Labor

NEPA National Environmental Policy Act of 1969

NHPA National Historic Preservation Act

NIDS News Item Data Sheet
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OC OSMRE Office of Communications

OIG Office of Inspector General

OMB Office of Management and Budget

OPAB OSMRE Office of Planning, Analysis and Budget

OSMRE Office of Surface Mining Reclamation and Enforcement

PA Problem Area

P.L. Public Law

RA Regulatory Authority (state or tribal)

RD Regional Director

RO Regional Office

SAM System for Award Management

SHPO State Historic Preservation Officer

SOAP Small Operator Assistance Program

SPOC Single Point of Contact

SMCRA Surface Mining Control and Reclamation Act

SS Account code for State Share/Tribal Share

UGMMI Underground Mine Mapping Initiative

USC United States Code

WCAP Watershed Cooperative Agreement Program

WEIB Western Interstate Energy Board

WR Western Region
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Annex D: FAM Part 1 - Requirements for All OSMRE Assistance Agreements

CHAPTER 1-100

DESCRIBING THE FEDERAL ASSISTANCE MANUAL

1-100-00 What is FAM?

1-100-10 What does this chapter do?

1-100-20 How is FAM organized?

1-100-30 What information can be found in each of the parts of FAM?

1-100-40 How do we revise FAM?

1-100-50 How do we approve an exception to a FAM requirement?

1-100-00 What is FAM?

The Federal Assistance Manual (FAM) provides policies and procedures to manage grants and 

cooperative agreements awarded to you by us, the Office of Surface Mining Reclamation and 

Enforcement (OSMRE). FAM is an official OSMRE directive, identified as number GMT-10 in 

our directive system. 

1-100-10 What does this chapter do?

This chapter describes the organization of FAM. It identifies the OSMRE office that is 

responsible for this manual. It explains how we go about changing or updating this manual, and 

how you can give us your comments and suggestions for FAM. This chapter also sets a process 

for us to use if we determine that we should not follow a policy in FAM.

1-100-20 How is FAM organized?

A. We divided the complete FAM into seven broad parts by grouping together topics or 

chapters on related financial assistance policies or programs. A chapter is the standard 

unit in FAM, generally addressing one financial assistance topic or process. Within 

chapters, information is broken out into sections, paragraphs, and subparagraphs as 

needed.

B. The numbering system of the FAM reflects this structure.

Part......................1

Chapter..................1-100

Section..................1-100-20

Paragraph...............1-100-20A

Subparagraph...........1-100-20A.1

1-100-30 What information can be found in each of the parts of FAM?
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FAM chapters are broadly grouped into seven parts.

Part 1- Requirements for All OSMRE Assistance Agreements This includes general policies and 

procedures for any OSMRE grant or cooperative agreement. These chapters describe the rules, 

and processes we use to award and manage assistance agreements. 

Part 2 General Requirements for Federal Assistance This includes policies for the assistance 

awarded by all federal agencies. These policies come from Federal laws, executive orders, and 

regulations, particularly Office of Management and Budget (OMB) circulars.

Part 3- Allowable Costs This explains which costs may be charged to OSMRE assistance 

agreements and how to handle different types of costs.

Part 4- Abandoned Mine Lands (AML) Grant Program This includes specific program, financial, 

and grant processing requirements for the AML program.

Part 5- Regulatory Grant Program This includes specific requirements for the Title V regulatory 

program.

Part 6- Watershed Cooperative Agreement Program This includes specific requirements for 

watershed cooperative agreements. 

Part 7- Technical Studies Cooperative Agreement Programs This includes specific requirements 

for applied science, and underground mine map agreements.

1-100-40 How do we revise FAM?

A. The Division of Reclamation Support, in the Program Support Directorate in OSMRE 

headquarters, is responsible to manage FAM.

B. We will revise FAM when necessary to reflect changes in OSMRE financial assistance 

programs, the policies and procedures governing assistance, or the processes we use to 

award and manage assistance agreements.

C. We encourage all FAM users to suggest improvements or revisions to this 

manual. Please send suggestions or comments to the Assistant Director, Program 

Support (AD-PS), or contact us through this website.

D. We will make proposed revisions to FAM available for review. We will address the 

comments we receive as required by OSMRE policy on directives. 

E. We may issue temporary FAM directives to reflect short-term changes. We may also use 

temporary FAM directives to implement new or revised policies or procedures quickly. 
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We may allow a temporary directive to lapse when the information is no longer needed, 

or we may incorporate the change permanently into FAM in the next major revision.

1-100-50 How do we approve an exception to a FAM requirement?

A. If Federal statute requires us not to follow FAM, the OSMRE awarding office must act as 

the law requires. The OSMRE office must notify the AD-PS of the conflict between the 

statute and FAM. 

B. We want to implement FAM as consistently as possible. Therefore, we must keep 

deviations from the FAM to a minimum. We will use the following procedures to request 

and approve FAM exceptions which are not required by Federal law.

1. The OSMRE office authorized to approve an award (our awarding office) may 

send requests to deviate from FAM through the Regional Director to the AD-PS. 

The request must identify the programs affected and the FAM provision for which 

the exception is requested. The request must clearly explain and justify the 

requested exception.

2. The AD-PS may approve deviation requests which only affect one assistance 

agreement. The official file for that agreement must document the FAM rule 

involved, the reason for deviating from it, and the name and title of the 

authorizing official.

3. The Director or Deputy Director must approve deviations affecting more than one 

assistance agreement.
D-4

CHAPTER 1-110

OSMRE RESPONSIBILITIES FOR THE ADMINISTRATION

OF OUR ASSISTANCE AGREEMENTS

1-110-00 What does this chapter do?

1-110-10 Who approves OSMRE assistance agreements?

1-110-20 Who is responsible to manage our assistance agreements?

1-110-30 Who is responsible for our policy on financial assistance?

1-110-40 Who is responsible for financial management of our assistance programs?

1-110-50 How will our offices communicate with each other when they carry out financial 

assistance responsibilities?

1-110-00 What does this chapter do?

This chapter explains how we, OSMRE, assign the responsibilities for managing our financial 

assistance programs to our offices. This information applies to all OSMRE assistance programs.

1-110-10 Who approves OSMRE assistance agreements?

A. The Director of OSMRE is authorized to approve each assistance award. The Director 

delegates this authority to the Regional Directors, who may delegate it further.

B. By approving the assistance award, the authorized official certifies that, in his or her 

opinion, the agreement is in accordance with all applicable laws and regulations, 

Departmental, and OSMRE assistance and program policies. 

C. No authorized official can be required to approve an assistance agreement unless the 

official is fully satisfied with the award. 

1-110-20 Who is responsible to manage our assistance agreements?

The Regional Directors manage our regional offices and the field and area offices within each 

region. They are responsible for award and management of OSMRE assistance agreements. 

They may delegate these functions to any of the offices or staff they manage. The office which 

awards a particular assistance agreement will also manage it after award. The awarding offices 

are responsible for the following activities: 

A. Receive and review assistance applications. Work with recipients to resolve all issues. 

Approve and process grant and cooperative agreement awards.

B. Determine availability of funds for award. Approve obligations and deobligations of 

assistance funds.

C. Coordinate with the Office of Communications to announce awards.
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D. Coordinate with the Division of Financial Management on assistance funding and

financial management issues.

E. Administer the awarded assistance agreements. Process and approve necessary 

amendments and budget revisions.

 

F. Receive, review, and take any necessary action on performance and financial reports by 

assistance agreement recipients.

G. Conduct oversight of program and project operations supported by assistance funds. 

Conduct reviews of recipient financial and operational systems. Resolve issues with 

recipients.

H. Work with recipients to resolve audit findings and recommendations.

I. Work with recipients to get assistance budget estimates. Provide analysis and 

recommendations on recipients' budget estimates.

J. Maintain the official assistance agreement files.

1-110-30 Who is responsible for our policy on financial assistance?

The Assistant Director, Program Support (AD-PS), in OSMRE headquarters, is responsible for 

the programmatic and administrative policy on financial assistance. Under the AD-PS, the 

Division of Reclamation Support has the following responsibilities related to assistance policy 

and management:

A. Develop, maintain, and coordinate national policy and uniform procedures for assistance 

administration. Develop agency-wide guidance on assistance programs. 

B. Provide procedures and direction for reviews or special studies of financial assistance 

programs to assess compliance with applicable laws, regulations, policies, and 

procedures.

C. Advise OSMRE management on financial assistance issues.

D. Maintain liaison with the Department of the Interior, the Office of Management and 

Budget, and other Federal agencies on assistance policy issues and procedures.

E. Initiate, conduct or assist in assistance training sessions for recipients and OSMRE staff. 

F. Develop procedures for the distribution of assistance program funds. Coordinate with the 

Regional Directors and Division of Financial Management to prepare the annual 
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regulatory and AML grant distributions.

1-110-40 Who is responsible for financial management of our assistance programs?

The Assistant Director, Finance and Administration (AD-F&A), in OSMRE Headquarters, is 

responsible for providing financial management support to the agency. Under the AD-F&A, the 

Division of Financial Management (DFM), located in Denver, Colorado, has the following 

responsibilities to support OSMRE assistance programs:

A. Maintain the official accounting records for assistance transactions.

B. Coordinate with Treasury to manage the system to transfer assistance funds to recipients.

C. Monitor and report information on financial assistance operations.

D. Calculate the annual AML fund distributions in coordination with the AD-PS.

1-110-50 How will our offices communicate with each other when they carry out financial 

assistance responsibilities?

A. With multiple offices involved in financial assistance, it is particularly important that all 

these offices establish and maintain open, clear, and effective channels of communication 

with each other. Offices must share information regarding their decisions and actions, 

especially on matters with wide applicability to other assistance operations, in order to 

ensure consistency in financial assistance operations throughout OSMRE.

B. OSMRE established its National Grants Team to promote coordination and consistency 

between offices involved in financial assistance operations. The Team includes all 

OSMRE staff whose primary responsibility is financial assistance. The Team 

communicates and meets regularly to identify assistance issues, develop resolutions, and 

share ideas and methods.
D-7

CHAPTER 1-120

ASSISTANCE AGREEMENT APPLICATIONS AND AWARDS

1-120-00 What does this chapter do?

1-120-10 How can you send us your application? 

1-120-20 When should you apply?

1-120-30 What should you include in your application?

1-120-40 How will we review your application and decide whether to approve it?

1-120-50 How will we award your grant or cooperative agreement?

1-120-60 What Information will we keep in our official assistance agreement file?

1-120-00 What does this chapter do?

A. This chapter explains how you, an applicant can apply for a grant or cooperative 

agreement funding awarded by us, the Office of Surface Mining Reclamation and 

Enforcement (OSMRE). It also explains how we review your application, and the 

process we use to award an agreement if we approve your application. 

B. This chapter does not apply to the assistance programs specifically described in other 

chapters of this manual: the Coal Regulatory program, Abandoned Mine Land (AML) 

program, Watershed Cooperative Agreement Program, and Technical Studies Program. 

This chapter applies to all other OSMRE financial assistance agreements, such as new, 

experimental, or one-time grants, or cooperative agreements.

1-120-10 How can you send us your application? 

You may send us your application by any of the following methods.

A. E-mail your application to us. You must show the name and title of the authorized 

official who signed the original forms and the date signed in the signature section of the 

application. You must maintain the original signed documents in your files;

B. Mail us your signed original paper application.

C. Enter your application in an approved electronic portal such as Grants.gov.

1-120-20 When should you apply?

You should send us a complete application at least 60 days before you intend to start the project.

1-120-30 What should you include in your application?

A complete application must provide all the information we need to decide whether to approve 

your application and also to process your assistance agreement. Include the following items in 
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your application: 

A. Signed or approved Application for Federal Assistance, SF-424.

B. The Program Narrative must explain the proposed project. You may use your own 

electronic medium to develop this narrative. You must provide the following 

information:

1. Objectives and Need for Assistance. Explain the need for the assistance. 

State the principal and subordinate objectives of the proposed assistance 

agreement. Include relevant data, and identify the sources of the data.

2. Results and Benefits Expected. Identify results and benefits that the 

proposed program will produce. For example, describe how this assistance 

agreement will help improve the environment and protect the health, safety, 

and welfare of the public. 

3. Approach. Outline a plan of action for the assistance agreement. Describe 

how the proposed work will be accomplished. Cite factors which might help 

or hinder the work. Explain your reasons for taking this approach as opposed 

to others. Describe any unusual features of this assistance agreement. 

Identify the kinds of data to be collected and maintained. Discuss the criteria 

and methodology to be used to evaluate the results, and success of the 

proposed program. 

C. The itemized budget must list the project costs. It must break out the total costs by 

line item, such as personnel and supplies. If your project will include more than one 

activity, the budget must break out the total costs by activity. If your project will 

include funds from other sources, the budget must break out total costs by the source 

of the funds. You may use the optional OSMRE 47 form or any format.

D. Your budget justification narrative must explain each cost included in your itemized 

budget list. Describe how you calculated the cost and why the item is needed. You 

must provide enough information for us to determine whether the line items included 

under each activity are reasonable, necessary, and allowable.

E. Describe your organization briefly. 

F. Describe any partners, other funding, and other support for the project.

G. Provide an appropriate Assurances form signed and dated by your organization’s 

authorized official. Use either the Assurances for Non-Construction Programs, form 

SF 424B; or the Assurances for Construction Programs, form SF 424D.
D-9

1-120-40 How will we review your application and decide whether to approve it?

We will normally review and process your application within 60 days of receiving it. Our 

awarding office must take the following actions to review your application:

A. If we receive your application by email or regular mail, we must confirm our receipt of 

the application within three working days. 

B. Determine that the application is administratively complete and that there are no obvious 

mathematical errors. 

C. Confirm that funds are available for the award. 

D. Check that your organization is eligible for Federal assistance funds. Check the System 

for Award Management (SAM) to determine whether a participant or principal is 

debarred, suspended, or otherwise ineligible. Confirm that your organization is in 

compliance with the single audit requirements if applicable.

E. Review the application. The programmatic review will assess the need for the program, 

its likelihood of success, and its appropriateness for OSMRE. The financial review will 

address whether the proposed costs are reasonable and necessary, the program will be 

efficient and effective, and your organization is able to manage Federal funds. 

F. We will determine whether to approve the application based on our reviews. If we 

disapprove the application, we will notify you in writing of our decision. If we approve 

the application, we will award your grant or cooperative agreement.

1-120-50 How will we award your grant or cooperative agreement?

After we decide to award your agreement, our awarding office will take the following actions to 

process the award:

A. Before the award, we will provide information about the planned award to our Office of 

Communications for Congressional and public news release. 

B. We must process the award through our electronic grant system. Our accounting system 

will post the award to Treasury’s grant payment system, where it will be available for you 

to request funds. 

C. We will send you a written agreement award document. We will also send you 

information about programmatic and financial reporting requirements, how to manage the 

agreement, and how to contact us. 

1-120-60 What Information will we keep in our official assistance agreement file?
D-10

The following is considered the minimum level of documentation that we will maintain in the 

official assistance agreement file. We will include additional supporting information and reports 

as appropriate for the particular application, the recipient, and the awarding office:

A. Your application as originally received, all subsequent additions or revisions, and any 

other information we received from you. 

B. Records of all meetings or telephone conversations which provided information in 

support of the application.

C. All correspondence between you and us about the application or the award decision.

D. All our internal reviews of the application or parts of the application.

E. All explanations or resolutions of questions raised during the review process.

F. All records or explanations of the timing of the award process, especially any time period 

when the awarding office could not process the award because it was waiting for actions 

outside its control, such as your responses to questions or availability of funds.
D-11

CHAPTER 1-130 

ASSISTANCE AGREEMENT CONDITIONS AND AWARD DOCUMENTS

1-130-00 What does this chapter do?

1-130-10 What does our assistance agreement award document do?

1-130-20 What Information must we include in the award document?

1-130-30 What conditions apply to our assistance agreements?

1-130-40 May we add additional specific conditions to your assistance agreement?

1-130-50 What Information will we provide to you with the award agreement?

1-130-00 What does this chapter do?

This chapter lists the conditions which apply to every grant and cooperative agreement awarded 

by us, the Office of Surface Mining Reclamation and Enforcement (OSMRE). It also lists the 

additional conditions which only apply to assistance agreements for specific programs, including 

regulatory and Abandoned Mine Land (AML) grants. This chapter also explains to you, the 

recipient, our minimum requirements for an assistance agreement document.

1-130-10 What does our assistance agreement award document do?

The assistance agreement award document is the official instrument we use for the following 

purposes:

A. Establish a legally binding arrangement between you and us.

B. List, or include by reference, the terms and conditions of the agreement.

C. Serve as the source document for the obligation of Federal funds in our accounting 

system.

1-130-20 What Information must we include in the award document?

We must process an award document for an assistance agreement through our electronic grant 

system. The award document must include the following information:

A. The legal name of the recipient. 

B. Agreement Identification, including the grant or cooperative agreement number, the 

amendment number, and the award date.

C. The amount awarded. For awards with multiple subaccounts or funding sources, the 

award document or an attachment will display the source of funds, subaccount number, 

accounting data and approved amount for each source or use of funds.
D-12

D. The dates of the performance period for the assistance agreement.

E. The purpose of the assistance agreement. 

F. The award must incorporate the following conditions by reference:

1. The Surface Mining Control and Reclamation Act of 1977 (SMCRA), as 

amended, P.L. 95-87, and any other authorizing legislation;

2. Your complete application for this assistance agreement, including amendments 

to the application;

3. The approved state or tribal regulatory or reclamation plan for this program, if 

applicable;

4. Any OSMRE policy directives which apply to this agreement, including this 

Federal Assistance Manual; and

5. All terms, conditions, or agreement clauses that are required by the Department of 

the Interior, OSMRE, or program policies.

1-130-30 What conditions apply to our assistance agreements?

A. The following conditions are incorporated into every OSMRE assistance agreement by 

reference:

1. Assistance funds must only be used to cover allowable costs, which are incurred 

during the agreement’s performance period. Valid obligations incurred before the 

end of the performance period for cost items specifically identified in the 

approved application will be considered allowable costs for the performance 

period to the extent of actual subsequent expenditures. If obligations are included 

in the claimed costs, adequate records must be maintained to disclose fully the 

date, and amount of the obligation incurred and the date and amount of 

subsequent payment. Obligations claimed in one performance period must be 

excluded from expenditures claimed in prior or subsequent periods.

2. Program income earned under all OSMRE assistance agreements other than 

Regulatory Administration and Enforcement (A&E) grants must be used to reduce 

the total cost of the agreement (deductive option). Program income earned under 

a Regulatory A&E grant must be used to meet the cost sharing/matching 

requirement of the grant (cost sharing option). Program income earned under a 

Regulatory A&E grant in excess of the cost sharing requirement may either be 

added to the funds committed to the grant agreement (addition option), or used for 

the deductive option.
D-13

3. You must obtain prior OSMRE approval to transfer funds to agencies other than 

those identified in the approved application.

4. You must submit financial reports, performance reports, and other reports 

according to the timing, content, and format as required by OSM. You must 

report program outlays and program income on a cash basis. 

5. For non-construction agreements, transfers of funds between total direct cost 

categories require our prior approval when such transfers exceed 10 percent of the 

total budget. For agreements that fund both construction, and non-construction 

activities, budget transfers between nonconstruction and construction subaccounts 

require our prior approval.

6. You must transfer to us the appropriate share, based on the Federal support 

percentage, of any refund, rebate, credit, or other amounts arising from the 

performance of this agreement, along with accrued interest, if any. You must take 

necessary action to collect promptly all monies due, and to cooperate with us in 

any claim or suit in connection with amounts due.

7. You must comply with the requirements, as applicable, of the Uniform 

Administrative Requirements, Cost Principles, and Audit Requirements for 

Federal Awards at 2 CFR Part 200, regarding administrative procedures; the Cash 

Management Improvement Act and 31 CFR Part 205 on financial procedures.

8. No employee of the state, Indian tribal government or Federal government 

performing any function or duty under the regulatory or reclamation program plan 

may have a direct or indirect financial interest in any coal mining operation. You 

must comply with all requirements and regulations established by OSMRE to 

carry out this requirement, including 30 CFR Part 705, and those requirements 

that it has adopted in its regulatory program or reclamation plan.

9. Prior to the start of any construction activity, you must ensure that all applicable 

Federal, state and local permits, and clearances are obtained.

10. You must not use any part of the appropriated funds for any activity or the 

publication or distribution of literature that in any way tends to promote public 

support, or opposition to any legislative proposal on which Congressional action 

is not complete. 

11. You must comply with the Federal procurement requirements in 2 CFR Part 200, 

and requirements of the Buy American Act at 41 U.S.C. § 8301.

12. You are free to copyright any original work developed in the course of, or under 
D-14

the agreement. OSMRE reserves a royalty-free, nonexclusive, and irrevocable 

right to reproduce, publish, or otherwise use, and to authorize others to use, the 

work for government purposes. Any publication resulting from work performed 

under the agreement must include an acknowledgment of OSMRE financial 

support, and a statement that the publication does not necessarily reflect our 

views.

 

13. No subsequent assistance agreements or amendments will be approved unless all 

overdue financial or performance reports have been submitted to the appropriate 

OSMRE office. Only the Regional Director or his designate can approve 

exceptions to this policy.

14. We reserve the right to transfer equipment acquired with assistance agreements to 

the Federal government or a third party. [Note: In order to invoke this provision, 

we also must notify the recipient in writing of the specific item of equipment to be 

transferred. Equipment must meet the definition in 2 CFR Part 200.]

15. The agreement takes effect at the time of approval by the Director of OSMRE or 

his authorized delegate. You accept the agreement including the terms, and 

conditions by starting work or making its first request for Federal funds approved 

under the agreement.

B. The following condition applies to all Regulatory Administration and Enforcement grant 

agreements:

This grant is for the administration and enforcement of an approved program for the 

regulation, and control of surface coal mining, and reclamation operations in accordance 

with 30 CFR 735. Grant funds must not be used for other purposes. As a condition of 

the grant, you must implement the regulatory program as approved by the Secretary of 

the Interior, including all findings, and conditions set forth in the Secretary's approval 

decision, or as may be modified by the Secretary. Grant funds must not be used for 

implementation of any changes to the regulatory program, which have not been approved 

by the Secretary of the Interior.

C. Conditions for AML agreements depend on which AML functions are included in the 

specific assistance agreement.

1. The following conditions apply to all AML assistance agreements:

a. This agreement is for the administration of the recipient’s approved 

reclamation plan, and for carrying out activities in accordance with the 

plan and Title IV of SMCRA. Funds from this agreement must not be 

used for any other purposes.
D-15

b. The funding for this agreement comes from one or more types of Title IV 

funds. Each type of funds may only be used as provided in SMCRA.

2. The following condition applies to AML agreements that include funding for an 

acid mine drainage set-aside fund:

You must establish an acid mine drainage abatement, and treatment fund. 

Amounts deposited into the fund, together with all interest earned, must be used 

by the recipient for the comprehensive abatement of the causes, and treatment of 

the effects of acid mine drainage, within qualified hydrologic units affected by 

coal mining practices.

D. The following condition applies to all Small Operator Assistance Program (SOAP) 

operational grant agreements:

This grant is for costs incurred by qualified laboratories for performance of technical 

work as provided in 30 CFR 795.9(b), and for costs incurred by qualified laboratories or 

state regulatory authorities for performance of planning activities, and training/outreach 

provided in section 507(c) of SMCRA. Planning activities must be directly related to 

individual assistance sites. Indirect costs are allowable only to the extent they relate to 

planning activities, training/outreach, or other authorized services provided directly by 

the regulatory authority. Grant funds must not be used for any other purpose, including 

expenses incurred by the regulatory authority to administer the SOAP.

1-130-40 May we add additional specific conditions to your assistance agreement?

We may add specific conditions to your assistance agreement to address a problem or a specific 

situation that needs special attention. However, imposing specific conditions is not our preferred 

method for addressing problems. Action plans developed jointly by you and OSMRE are more 

likely to succeed than unilaterally imposed specific conditions, that may disrupt your processes 

and plans. Therefore, we reserve the right for the use of specific award conditions for serious 

and unusual situations. A specific assistance agreement condition must be tailored to the 

situation, and must identify exactly what and how you will perform. We will monitor specific 

conditions very closely to ensure strict adherence.

1-130-50 What Information will we provide to you with the award agreement?

When we transmit an award to you, our awarding office will include additional information. We 

will inform you of all reports due to us under this agreement, with reporting periods and due 

dates, and state the consequences if you do not meet the reporting requirements. We will list 

contacts for your program, financial and payment questions. We will also provide any other 

information, which may assist you in managing the agreement.
D-16

CHAPTER 1-140

ASSISTANCE AGREEMENT NUMBERING AND FILES ORGANIZATION 

1-140-00 What does this chapter do? 

1-140-10 How is your assistance agreement number assigned?

1-140-20 Who maintains our official assistance agreement files? 

1-140-30 Will we keep our official files on paper or in electronic form?

1-140-40 What must we include in our official assistance agreement files?

1-140-50 How should we organize our official assistance agreement files?

1-140-00 What does this chapter do? 

This chapter explains how we assign identifying numbers to assistance agreements awarded by 

us, the Office of Surface Mining Reclamation and Enforcement (OSMRE). It also explains our 

requirements for our official assistance agreement files. It outlines how we organize our official 

agreement file. These rules apply to all OSMRE assistance programs.

1-140-10 How is your assistance agreement number assigned?

A. All assistance agreement numbers are automatically assigned by our electronic grant 

system. 

B. The system uses the following numbering structure.

1. The first digit is the letter “S”, which is the Department’s code for OSMRE. 

2. The next two numbers show the Federal fiscal year when we originally awarded 

the agreement. 

3. The next two letters show the type of agreement. The first letter is “A” for 

financial assistance. OSMRE grants normally are “AF” for a formula grant 

(AML) or “AP” for a project grant (Regulatory). “AC” is normally used for 

cooperative agreements (Watershed, Applied Science).

4. The final five numbers are automatically assigned by the system in sequential 

order.

1-140-20 Who maintains our official assistance agreement files? 

A. The office that awarded the agreement is responsible for our official assistance agreement 

files. 
D-17

B. The official file for each grant or cooperative agreement will be established and 

maintained by the appropriate grants specialist in our awarding office.

1-140-30 Will we keep our official files on paper or in electronic form?

Departmental policy requires us to keep the complete official assistance agreement file on paper. 

Some information in the hard copy files will be duplicated in the electronic grant system or in 

additional electronic files. All records in the electronic grant system must be printed and filed in 

the official assistance agreement file. 

1-140-40 What must we include in our official assistance agreement files?

Each official assistance agreement file must contain at least the following items.

A. All items received from the recipient.

B. Complete award documents for the original agreement and all amendments. 

C. Information sent to the recipient with the award.

D. Findings and recommendations from application reviews and all other documentation 

from reviewing the application or processing the award.

E. Recipient performance, financial and other reports.

F. Monitoring statements or other documentation of our review of recipient performance or 

reports.

G. All correspondence from or to the recipient or any other party related to the agreement.

1-140-50 How should we organize our official assistance agreement files?

Our awarding office must keep the official files for its assistance agreements in a consistent 

format. The standard format is in a six-segment file folder, with the most recent information, or 

activities on top, organized as follows:

A. Segment 1 is the Approved Application, amendments, letter revision requests, and final 

closeout submissions. This segment contains the complete application as we approved it 

in our original award, amendment applications, and letter requests.

1. Recipients transmittal letter or email.

2. Our notification to the recipient confirming receipt of application.
D-18

3. SF 424 (Application for Federal Assistance).

4. Recipient submitted documents related to intergovernmental coordination (E.O. 

12372).

5. Budget request with all required backup information.

6. Program narrative.

7. Any assurances, certifications or disclosure reports required for this application. 

8. Indirect Cost Rate agreement approved by the cognizant Federal agency.

9. Any supporting information included with the assistance application.

10. Letter revisions to the application.

We will group these materials by application version (i.e., initial application, amendment 

request, or letter revision request). All material should be dated.

B. Segment 2, Award Document packages, which includes the following documents.

1. Approved Award Document from our electronic grant system, including approved 

amendments.

2. Grants Monitoring Checklists.

3. Letters of Approval.

4. Our notifications to recipients of approved applications, amendments, and all 

closeout documentation (i.e. final financial and programmatic reports and reviews 

and associated checklists).

5. Our internal review and approval documents, including Findings and 

Recommendation memos, Financial and Program review documentation, 

congressional notifications, and funds availability confirmations.

Do not include letters from the recipient in this segment. They belong either in segment 

1 (if the correspondence is part of the application or a letter revision request) or in 

segment 6 with Miscellaneous Correspondence. 

C. Segment 3, Support and Review Documentation, which includes the following 

documents.
D-19

1. Documentation of eligibility for Federal Financial Assistance, including Excluded 

Parties, single audit requirements, our intergovernmental coordination (E.O. 

12372) efforts, and the FA Risk Assessment Checklist.

D. Segment 4, Documentations of trip reports, drawdown analyses, or other visits to the 

recipient.

E. Segment 5, Non-closeout Financial and Performance Reporting Documents, contains the 

following documents. This segment will not be used as the basis for financial auditing; 

therefore, duplicates of all detailed financial documents, and records contained in the 

recipient's files are not needed.

1. Financial Report.

2. Narrative performance report.

3. Monitoring statements documenting OSMRE reviews.

4. Documentation of any report extensions requested and granted

5. Copy of current milestone plan.

F. Segment 6, Miscellaneous Correspondence and Reports, includes the following 

documents.

1. General correspondence and correspondence providing general guidance

concerning the grant. 

2. News releases, news clippings, recipient newsletters.

3. Letters from members of Congress, the public, and OSMRE responses.
D-20

CHAPTER 1-150

MONITORING AND TECHNICAL ASSISTANCE 

1-150-00 What does this chapter do? 

1-150-10 What are your responsibilities for monitoring program performance?

1-150-20 What are our responsibilities for monitoring program performance?

1-150-30 What will we do to monitor program performance? 

1-150-40 What do we do if an applicant is “high risk”?

1-150-50 What kinds of technical assistance might we provide to you?

1-150-00 What does this chapter do? 

This chapter outlines our policies and procedures for monitoring all assistance agreements 

awarded by the Office of Surface Mining Reclamation and Enforcement (OSMRE). Monitoring 

is the financial and programmatic review and oversight we perform to ensure that our programs 

are efficient and effective. This chapter also explains our technical assistance, which is the 

information, guidance and training we provide to you, the recipient, to help increase your 

knowledge or skills.

1-150-10 What are your responsibilities for monitoring program performance?

You have primary responsibility for performance under the assistance agreement you received 

from OSMRE. You must monitor all activities, including your subgrants or other agreements. 

You are responsible to assure that all work conducted under the agreement is performed in 

keeping with the terms, conditions and scope of the approved agreement. You must monitor 

each program, function or activity as set forth in your approved application or program plan. You 

must continually review the performance of all assistance activities to assure that adequate and 

timely progress is being made toward achieving the goals and objectives of the agreement.

1-150-20 What are our responsibilities for monitoring program performance?

A. We must monitor all active assistance agreements to ensure that operations comply with 

Federal laws and regulations, and are efficient and effective. 

1. Programmatic and financial oversight is an important part of our program 

management. Our REG-8 and AML-22 oversight directives establish a joint 

oversight process. We work with you to develop and carry out a specific 

oversight program reviewing on-the-ground results for each assistance agreement. 

2. Our monitoring includes tracking your required reports, reviewing them, and 

resolving all issues. Monitoring also includes reviews of particular issues 

considered appropriate for your specific circumstances. 
D-21

3. Financial monitoring also includes drawdown analysis and our review of cash 

management. See Chapter 1-160 for more information.

B. Our monitoring responsibilities begin when we receive a financial assistance 

application. When we review your application, we must determine if you can accomplish 

the proposed goals in the manner and time frame proposed, and if you can manage the 

project in compliance with Federal laws and regulations. We must also assess a level of 

risk in making this award and develop an appropriate monitoring plan. Once we approve 

the assistance agreement, we must compare your actual accomplishments to the approved 

goals and manner of performance.

1-150-30 What will we do to monitor program performance? 

A. We will perform the following required actions:

1. Review and approve your financial and performance reports.

2. Evaluate your timely submission of required reports. We will review tracking 

information provided by the financial system, maintain any additional tracking 

which may be necessary, and take appropriate action to resolve concerns.

3. Review and document other information on assistance agreement performance. 

Information may come from site visits, correspondence, e-mails, and telephone 

conversations with you or other parties.

4. Document the results of all assistance agreement monitoring actions on our 

monitoring statement form or in any appropriate format. 

5. Keep all monitoring documents in our official agreement file. We will also 

distribute monitoring documents between OSMRE personnel, and offices as 

appropriate.

B. We will select additional monitoring topics as appropriate. Events or circumstances such 

as the following may suggest topics we would review to analyze your performance. 

1. Statements in your application regarding requirements, activities, and program 

objectives.

2. Previous experience with you in this program, other OSMRE programs, or other 

Federal programs.

3. Audit reports, including your single audits as required by 2 CFR Part 200, or 

audits by the Government Accountability Office, or the Department of the 

Interior, Office of Inspector General.
D-22

4. Your implementation of the approved indirect cost rate agreement.

5. Your implementation of appropriate systems and internal controls for functions such 

as procurement, property, or cost distribution.

1-150-40 What do we do if an applicant is “high risk”?

A. We may conclude that an applicant is “high risk” if we determine that you meet any of 

the following criteria.

1. You have a history of unsatisfactory performance.

2. You are not financially stable.

3. You have a management system which does not meet the financial management 

standards set forth in the Uniform Administrative Requirements, Cost Principles, 

and Audit Requirements for Federal Awards at 2 CFR Part 200 Subpart D.

4. You have not met the terms and conditions of previous awards

5. You are otherwise not responsible.

B. We have several options to minimize the risk to Federal funds if we determine that an 

applicant is “high risk”:

1. Do not award a grant or cooperative agreement. We should not award an 

assistance agreement if the nature and extent of the risk are so serious that 

inadequate or improper performance is probable.

2. Convert a grant to a cooperative agreement with additional Federal involvement 

in program performance.

3. Include special conditions or restrictions in the award. We may take the 

following actions.

a. Pay you on a reimbursement basis rather than advance funds. We may 

also require that we approve each payment request before it is paid.

b. Withhold authority for you to proceed to the next phase within an 

agreement until we receive evidence of acceptable performance.

c. Require our prior approval for more of your operations and activities.
D-23

d. Require additional and/or more detailed financial reports.

e. Require you to obtain technical or management assistance.

f. Do additional project monitoring.

4. If we decide to impose special conditions, our awarding office will notify you in 

writing as early as possible. We will provide the following information:

a. The nature of the special conditions.

b. The reasons for imposing them.

c. The corrective actions which you must take before we will remove the 

special conditions.

d. The time allowed for you to complete the corrective actions.

 e. How you may request reconsideration of the special conditions we plan to 

impose.

1-150-50 What kinds of technical assistance might we provide to you?

The purpose of technical assistance is to provide you or your staff with additional information, or 

raise your level of competence. In deciding what type of technical assistance is appropriate, we 

may consider the following range of services.

A. Require you to correct the problem we identify, and get technical assistance if necessary.

B. Provide technical assistance by our staff directly to you at your site.

C. Identify appropriate training opportunities and resources.

D. Ask other available organizations to supply appropriate technical assistance.
D-24

CHAPTER 1-160

DRAWDOWN ANALYSIS

1-160-00 What does this chapter do?

1-160-10 What is a drawdown and why do we analyze it?

1-160-20 What are the requirements for managing Federal cash and where do they come 

from?

1-160-30 What must you do when you manage Federal cash?

1-160-40 What must we do to monitor your use of Federal cash?

1-160-50 What types of drawdown reviews will we conduct?

1-160-60 What will we do in a Level 1 drawdown review?

1-160-70 What will we do in a Level 2 drawdown review?

1-160-80 How will we resolve problems identified in drawdown reviews?

1-160-00 What does this chapter do?

This chapter explains our policies and procedures for reviewing how you use Federal cash 

received from an assistance agreement awarded by us, the Office of Surface Mining Reclamation 

and Enforcement (OSMRE). This information applies to all OSMRE assistance agreements.

1-160-10 What is a drawdown and why do we analyze it?

A drawdown is your request for a cash payment from your assistance agreement. We analyze 

your drawdowns to ensure that you are managing Federal cash in accordance with Federal 

requirements. 

1-160-20 What are the requirements for managing Federal cash and where do they come 

from?

A. The Federal government requires that you minimize the time you hold Federal cash in 

order to minimize the interest costs to the U.S. Treasury. 

B. The Department of the Interior requires that methods and procedures for payment must 

minimize the time that elapses between when you receive the funds and when you or 

your subrecipient pay them out. This requirement comes from the Uniform 

Administrative Requirements, Cost Principles, and Audit Requirements for Federal 

Awards at 2 CFR Part 200, Subpart D. 

C. The Cash Management Improvement Act (CMIA) of 1990 (P.L. 101-453), as amended 

by the Cash Management Improvement Act of 1992 (P.L. 102-589), provides the general 

rules and procedures for the efficient transfer of Federal financial assistance between the 

U.S. Treasury and states. All Federal funds transfers to states are covered. However, 

only major assistance programs (the highest-dollar programs) are included in written 

Treasury-State Agreements. These agreements specify how transfers of Federal funds to 
D-25

states will take place. They assess interest liability for not performing the terms of the 

agreement. 

D. U.S. Treasury Rules Applicable to Federal Assistance Programs not Included in a 

Treasury-State Agreement, at 31 CFR 205, require you to minimize the time between 

when you drawdown Federal funds and pay them out for your assistance program. The 

payments must be limited to the minimum amounts you need. The payment must be 

timed in accord with your actual, immediate cash requirements to carry out your 

program. The timing and amount of payments must be as close as is administratively 

feasible to your actual cash outlay for direct program costs and the appropriate share of 

any allowable indirect costs. You must exercise sound cash management in paying funds 

to any subrecipients.

1-160-30 What must you do when you manage Federal cash?

A. You must limit advances of Federal funds to the minimum amount you need to meet your 

actual and immediate cash payments.

B. You must pay out Federal funds as soon as is administratively feasible under your 

financial management systems.

C. If you have a CMIA Treasury-State Agreement, you must comply with it.

1-160-40 What must we do to monitor your use of Federal cash?

A. We must monitor your compliance with Federal requirements. We will review your use 

of funds paid by Treasury to ensure that you do not request excessive amounts of advance 

funds and that you do not keep cash in excess of the immediate need. 

B. We will determine the appropriate timing, magnitude and complexity for our review. 

C. If we find indications during a drawdown review that Federal funds may not be properly 

accounted for, we will review the issue sufficiently to determine whether further action is 

needed.

1-160-50 What types of drawdown reviews will we conduct?

A. We will perform a Level I drawdown review the first time we review your systems, after 

significant changes to your systems, or when the reviewer determines it is appropriate. A 

Level I review has the following objectives.

1. To understand your systems for requesting and making payments.
D-26

2. To determine in calendar days the minimum administratively-feasible time for 

you to make payments.

3. To identify major problems or changes in your systems.

B. We will periodically perform a Level II review to monitor continuing performance of a 

system we have previously reviewed. The objective of the review is to determine 

whether your systems for requesting and paying Federal funds continue to comply with 

Federal requirements.

1-160-60 What will we do in a Level 1 drawdown review?

A. We will review your procedures to the extent needed to draw and support conclusions 

about your systems.

1. The reviewer will collect information about your systems. This phase may 

include the following steps:

a. Review your laws, regulations, policies, procedures and financial 

management systems. This will include reviewing your processes for 

requesting, and paying out Federal funds.

b. Flowchart or outline the processing steps according to your written 

policies, and/or the actual procedures being followed.

c. Test the procedures used to request Federal funds. If you have multiple 

OSMRE assistance programs, we will review transactions adequate to test 

each program.

d. Test the procedures for paying out Federal funds.

e. Develop an expenditure rate. Compare the amount of Federal funds 

requested to your expenditure rate. 

f. Determine the frequency rate for cash draws.

g. Track the amount of the cash balance on hand, and the Federal funds 

requested for each drawdown request.

2. Evaluate the data to make the following determinations:

a. What is the actual and optimum number of days required to pay funds 

under your systems?
D-27

b. Do significant trends exist or are they developing?

c. Are there any procedures under your control which should be corrected or 

streamlined? 

d. Are there any procedures not under your control which can be 

streamlined?

B. The awarding office will report the review findings.

1. We will write a report explaining and justifying the office’s findings and 

recommendations determinations about your systems and file the report with 

adequate supporting documentation in the official assistance agreement file.

2. We will present the results of the review to you. If necessary, the awarding office 

will work with you to resolve any issues or recommendations.

1-160-70 What will we do in a Level 2 drawdown review?

A. Our awarding office will review the minimum number of cash requests and payments 

required to determine whether there have been any changes in the payment practices or 

timeframes established in the level I review. 

B. We will determine whether you are requesting cash payments on an advance or 

reimbursement basis. If we find that you continue to operate on a reimbursement basis, 

the review is complete.

C. If you are requesting cash advances, we will determine whether your system continues to 

meet the timeliness standard for paying out Federal funds. If we find that you continue to 

pay out Federal funds timely, the review is complete.

D. If there have been significant changes in your systems, we will conduct a level 1 review 

or other review steps as necessary to determine that the systems are in compliance.

E. We will complete and document the review.

1. If the review raised any issues or concerns, our awarding office will work with 

you to resolve the findings.

2. Our awarding office will file the review and any supporting documentation in its 

official assistance agreement file.

1-160-80 How will we resolve problems identified in drawdown reviews?
D-28

A. The awarding office will address and resolve any issues discovered in drawdown 

reviews. We may use the following approach for resolving problems:

1. Collect all necessary information. Document the critical time path and identify 

the most problematic points in the process. Determine the scope and extent of the 

problem. Identify any changes in the grantee's systems, procedures or internal 

controls, or in key personnel which may have contributed to the problem. If 

additional information is needed, perform further review procedures.

2. Develop suggestions for resolution of issues.

3. Present our suggestions to you. We will work with you to consider mechanisms 

or improvements within your systems to address the issues.

4. Develop an agreement between you and us with actions, and a schedule for 

resolving the issues.

B. The awarding office must document any resolution agreement: We will conduct followup reviews as necessary to ensure that changes and improvements are being made, and 

that the problem has been resolved.
D-29

CHAPTER 1-170

OVERDUE REPORTS 

1-170-00 What does this chapter do? 

1-170-10 What is our policy on reporting requirements?

1-170-20 What must you do to request an extension or waiver of a report? 

1-170-30 What will we do when a report is overdue?

1-170-40 What further actions can we take if we still do not receive the required report?

1-170-50 Do we have any alternatives to suspension or termination actions?

Exhibit 1 Sample Confirmation of Extended Report Due Date

Exhibit 2 Sample Warning Notice to Recipient

1-170-00 What does this chapter do? 

This chapter explains what we will do if we do not receive the required reports for an assistance 

agreement we award to you.

1-170-10 What is our policy on reporting requirements?

A. The reporting requirement is a key condition of your grant or cooperative agreement. 

1. We sent you a list of the reports and due dates required under your agreement when 

we sent you the written award document for your assistance agreement. 

2. To see further information regarding report requirements for specific programs, 

please see Chapter 4-230 for AML agreements; 5-230 for Regulatory program 

agreements, 6-230 for Watershed cooperative agreements, and 7-230 for Technical 

Studies agreements.

B. We must take vigorous and effective action to obtain overdue reports.

C. As a condition of all our assistance agreements, we will not approve any subsequent 

assistance awards or amendments to you unless we have received all overdue financial or 

performance reports. Only our Regional Director (RD) can approve exceptions to this 

policy.

1-170-20 What must you do to request an extension or waiver of a report? 

A. We may extend a report deadline only if you send us a written request with adequate 

justification before the scheduled due date. Your request must explain why you need the 

extension, and propose a new due date for the report. We will enter the revised due date 

into our grant tracking system. We will file your request and our response in our official 

assistance agreement file. 
D-30

B. We may waive a required report only if you send us a written request with adequate 

justification before the scheduled due date. To waive a required report, we must be able to 

determine that we can accomplish the purposes for the report information in some other 

way. If we waive a reporting requirement, we will notify you in writing, and update our 

grant tracking system. 

1-170-30 What will we do when a report is overdue?

A. If we do not receive a report by the due date, we will contact you.

1. We will notify you that the due date has passed and we have not received the 

required report.

2. We will remind you that failure to submit reports on time makes you noncompliant 

with the terms of the assistance agreement. Noncompliance may result in sanctions 

including withholding cash payments, disallowing current expenditures, suspending 

or terminating part or the entire current award, not awarding further grants for the 

program, or other legal remedies.

3. We will ask you to send us the report immediately. We will negotiate with you a 

proposed extension of the due date not to exceed 30 calendar days.

B. We must confirm all agreements about overdue reports in writing. Our confirmation will 

state the approved extended due date for the report. It will also remind you of the 

sanctions, which we may impose for noncompliance if we do not receive either the report 

or an acceptable explanation by the new due date. We will then enter the revised due date 

in our grant tracking system. Exhibit 1 of this chapter is a sample confirmation document.

1-170-40 What further actions can we take if we still do not receive the required report?

A. If we do not receive either the report or an acceptable explanation by the agreed-upon 

extended due date, we will issue a written warning to you stating that you are noncompliant 

with the reporting requirements of the assistance agreement. The notice will state that 

unless the required reports are received within the next 10 calendar days, we will make no 

further payments and the grant award will be suspended until all required reports are 

received, and that the suspension may be converted to a termination 30 days later. Our 

notice will also state that we will make no further grant awards until we receive all overdue 

reports. Exhibit 2 of this chapter is a sample warning notice.

B. If the report or an acceptable explanation is not received by the end of the 10 calendar day 

period cited in our notice, we will coordinate with our Assistant Directors for Finance and 

Administration (AD-F&A) and for Program Support (AD-PS) to suspend the grant award 

and payments. We will withhold further grant awards until all delinquent reports have been 
D-31

received. Our Division of Financial Management (DFM) will ensure that no payments are 

made, and that the awarding office and AD-PS are informed of actions taken. 

C. If the report or an acceptable explanation is not received by the end of 30 calendar days 

after the suspension, we will convert the suspension to a termination. See Chapter 2-270

for more information on enforcement and termination actions.

1-170-50 Do we have any alternatives to suspension or termination actions?

A. Our RD may waive suspension or termination of a grant agreement for noncompliance with 

reporting requirements with a written determination that it is in the best interests of 

OSMRE to continue the program. 

B. We strongly encourage you to work with your awarding office before the end of the report 

extension period to ensure that the report is submitted, or an appropriate explanation is 

provided, and accepted, in order to avoid the suspension and termination provisions.
D-32

EXHIBIT 1

Sample Confirmation of Extended Report Due Date

Dear :

This is to confirm our telephone conversation of . It outlines the agreement we 

reached for the submission of the following delinquent report(s):

Grant No.:

Report Description: [Financial Report and/or Performance Report]

Report Due for Period:

As you are aware, these reports were due to OSMRE on __________________.

Acceptance of a grant or cooperative agreement award carries with it the obligation for proper and 

timely accountability, both programmatic and fiscal. Please be aware that failure to submit 

required reports in a timely manner makes your organization noncompliant. This may result in the 

imposition of sanctions including (a) withholding cash payments pending receipt of the required 

reports; (b) denying authority to commit Federal or matching funds for this program; (c) 

suspension or termination of part or all of this grant award; (d) withholding further awards for this 

program until the required reports are received; or other legal remedies.

In keeping with the understanding reached in our telephone conversation, we will expect to receive 

the overdue report(s) by .

If you are unable to meet the agreed deadline, it is imperative that you inform us as soon as 

possible of the reasons why you are unable to meet the deadline and when you will submit the 

report.

If you have any questions regarding this matter, or if I can be of assistance in expediting the 

submission of the report, please do not hesitate to contact me at ( ) .

Sincerely,

Awarding Office Official
D-33

EXHIBIT 2

Sample Warning Notice to Recipient

Dear :

The following grant reports are seriously overdue:

Grant No:

Report Description: [Financial Report and/or Performance Report]

Report Period:

This letter is to warn you that your organization is noncompliant with the reporting requirements of 

the assistance agreement. The reports were originally due on __________. My previous letter 

dated __________ confirmed our agreement by telephone to extend the due date to __________. 

The reports have not been received in this office.

Unless the reports listed above are received by __________ [within the next 10 calendar days],

OSMRE will make no further payments and the grant award will be suspended until all required 

reports are received. The grant suspension may be converted to a termination on __________ [30 

days after the suspension]. No further grant awards will be made by OSMRE until all overdue 

reports have been received. 

Should you or your staff have any questions regarding this matter, or if we can be of assistance in 

expediting receipt of the reports, please do not hesitate to contact me. If a site visit by me or my 

staff would be helpful, we would be pleased to come.

Sincerely,

Awarding Office Official

cc: DFM
D-34

CHAPTER 1-180

AUDIT RESOLUTION AND COST DISALLOWANCES

1-180-00 What does this chapter do?

1-180-10 What audits and reviews are covered by this chapter?

1-180-20 What is our primary emphasis in resolving an audit?

1-180-30 What process do we use to develop an audit resolution?

1-180-40 How do we process our audit decision?

1-180-50 How can you appeal our audit decision?

Exhibit 1 Audit Decision Form

Exhibit 2 Sample Decision Transmittal to Recipient

1-180-00 What does this chapter do?

This chapter provides an overview of our policies and procedures for resolving audit findings 

related to assistance agreements awarded by us, the Office of Surface Mining Reclamation and 

Enforcement (OSMRE). It also describes how we may evaluate audit cost disallowances based 

on projecting audit findings to time periods not specifically examined by the auditors. 

1-180-10 What audits and reviews are covered by this chapter?

A. The Uniform Administrative Requirements, Cost Principles and Audit Requirements for 

Federal Awards, at 2 CFR Part 200, Subpart F, requires recipients that expend $750,000 

or more in a year in Federal awards to conduct a single audit of the organization’s 

financial statements and Federal awards. Audit issues for our assistance agreements 

normally come from the single audit process through the cognizant Federal agency, the 

lead Federal agency working with your organization. We will use the procedures in this 

chapter to resolve single audit issues. 

B. These procedures also apply to issues raised by other audits, such as the Government 

Accountability Office or the Department of the Interior Inspector General’s Office. They 

also apply to other financial or management reviews of the assistance agreements with 

findings or recommendations that we must resolve. 

1-180-20 What is our primary emphasis in resolving an audit?

A. When auditors report deficiencies in an organization with which we have a continuing 

relationship, our primary emphasis is to ensure that the deficiencies are adequately 

corrected. We must ensure that the deficiencies will not occur again under this 

agreement or any future assistance agreements.

B. If we disallow costs, we will limit the disallowance to costs incurred during (a) the 

organization's three fiscal years immediately preceding the starting date of the audit, and 

(b) subsequent periods up to the date the deficiencies are corrected. 
D-35

For example, if an audit of a grant for the period July 1, 2009, through June, 30, 2010, 

found deficiencies in a recipient’s management system and questioned cost amounts 

based on extending the findings to earlier or later grants, we would limit the disallowed 

costs as follows.

Date audit started: December 12, 2010

Organization’s three previous fiscal years: July 1, 2007, through June 30, 2010

Date deficiencies corrected: July 1, 2011

Limitation on cost disallowances: July 1, 2007, through June 30, 2011

1-180-30 What process do we use to develop an audit resolution?

A. We must resolve all audits in a timely and proper manner. Our awarding office will 

resolve audits within 60 calendar days of our receipt. The 60-day period allows 30 days 

for you, the recipient, to respond to the audit findings. In the remaining 30 days, we will 

review your response, develop an appropriate resolution of the issue, approve the 

resolution, and inform you and our agency officials.

B. We receive the audit report and distribute it to the awarding office for review and 

resolution.

1. Normally, the Department of the Interior Office of Inspector General (DOI-OIG) 

receives an audit report from your cognizant Federal agency or from the auditors. 

DOI forwards the audit to OSM’s Office of Planning, Analysis and Budget 

(OPAB).

2. OPAB reviews the report and forwards it to the appropriate Regional Director 

(RD) for review. If we have any issues to resolve, OPAB enters the report into 

OSM’s audit tracking system.

3. The RD forwards the audit report to the grants specialist who works with that 

recipient. The grants specialist must review the report. If we have no issues to 

resolve, the awarding office need not take any further action on the audit.

C. We request your response to the audit findings.

1. Our grant specialist will prepare a written request to you asking you to respond to 

the audit findings. The request must include a summary of the findings to be 

resolved, and a copy of the relevant portion of the audit report. We will inform 

you that your response is due back to us 30 days after you receive the request. 

Our request should be signed or approved by the official authorized to approve 

your assistance award. Our grant specialist must confirm the date you receive the 

letter through the use of certified mail, a documented telephone conversation, or 
D-36

other means. Our grant specialist will keep in contact with you throughout the 30-

day response period and provide technical assistance as needed.

2. You may request an extension to the 30-day response deadline. Your request 

must be fully justified, with an explanation of the unusual circumstances which 

prevent your timely response. Your request must also include a schedule for the 

final response. 

3. Our awarding office may choose to approve or disapprove your request. If our 

approval will delay resolution of the audit beyond the 60-day period, our grant 

specialist must notify OPAB of the reason for the extension and the new audit 

resolution due date.

D. You respond to the audit findings in writing. 

1. Your audit response must state whether you concur or disagree with each finding 

or recommendation. If you concur, you should specify how and when you will 

implement corrections and system changes. If you concur that questioned costs 

should be disallowed, you must specify when you will pay back the funds for the 

disallowed costs. 

2. If you disagree with a finding or recommendation or questioned cost, you should 

justify your position and offer any alternative information or supporting 

documentation. You should send the response to our grants specialist.

E. If you do not respond within the 30-day deadline, our grants specialist may proceed on 

the basis of the available information to recommend resolution actions and prepare the 

decision letter to be signed by our authorized official.

F. We review your response.

1. In evaluating your response, the standard we apply is whether the costs are 

allowable, documented, reasonable, and justified. Factors such as the good faith 

of the organization, successful accomplishment of program objectives, or your 

ignorance of requirements should not be used as a basis for allowing costs which 

are unallowable. Our awarding office is not authorized to waive collection of 

unallowable costs. 

2. The auditor’s findings may have been based on estimates or statistical sampling of 

a few documents, with the findings projected to the total population. If you 

present an alternative sampling methodology or analysis, we may choose to 

accept it. 
D-37

3. If the auditor questioned costs because you failed to request advance agency 

approval, but we would have approved the action if you had requested it, the 

official who would have approved the request may allow the questioned costs. 

4. If the information you submit is inadequate or inconclusive, our grant specialist 

may recommend disallowance of the entire questioned amount. Alternatively, our 

grant specialist may work with you to obtain more information. 

G. We may have meetings and discussions with you before we make audit decisions.

1. If your response is inadequate, our grant specialist may contact you and request 

additional information or a revised response. Alternatively, the grant specialist or 

other staff may perform an on-site review of your records to acquire the needed 

information. However, the requirement for timely resolution of audits still 

applies. If these actions will result in a delay of audit resolution beyond the 60-

day period, our grant specialist must notify OPAB of the reason for the delay and 

the new audit resolution due date.

2. Our officials may need to meet with your officials to develop acceptable actions 

and schedules to resolve audit concerns or to design changes needed in procedures 

and systems. Written meeting notes must be kept. The decision letter resolving 

the audit must include agreements developed in these meetings.

3. We have found that it is best to get your concurrence with all aspects of a 

proposed resolution before we make our decision. When possible, we will discuss 

any plan to require changes in your processes, or systems with you before we 

include it in our audit decision.

4. If we decide to disallow costs, our awarding office will discuss with you how you 

will pay them. If appropriate, we will meet with you either before or after 

issuance of the decision letter to negotiate an extended payment plan for 

disallowed costs. 

1-180-40 How do we process our audit decision?

A. After full consideration of your responses and other pertinent information obtained, our 

grant specialist will recommend whether or not to allow any questioned costs, and what 

corrective actions we will require to resolve administrative findings. The official 

authorized to approve your assistance agreements must approve the resolution. 

B. We will document our audit decision and prepare a transmittal to send it to you.
D-38

1. Our awarding office will use the Audit Decision Form (Exhibit 1) to document all 

decisions made to resolve the audit. Both our grant specialist and the official 

authorized to approve our assistance awards must approve the form. For each 

finding, the form will accomplish the following: 

a. Summarize the initial audit report finding.

b. Summarize your response.

c. Summarize any discussion or any other pertinent factors.

d. State the final decision.

e. Identify any corrective actions to be taken by you and include the schedule 

to implement them.

f. Identify any follow-up reviews or actions we will be doing.

g. Identify total disallowed costs and include a plan for collecting them.

2. We will use a transmittal document to send the Audit Decision Form to you. 

Exhibit 2 is an outline of a sample letter. The transmittal is prepared by our grant 

specialist and approved by the official authorized to approve your assistance 

awards. Our transmittal will accomplish the following:

a. Identify the audit number.

b. Refer to the attached Audit Decision Form.

c. Specify payment procedure, address, and due date for any amounts owed. 

The due date should be 30 days after your receipt of the decision.

d. Identify any revised cost reports you must submit.

e. Summarize the appeal procedures you may use.

f. State that the resolution is final unless questioned by DOI OIG.

g. Identify an OSMRE contact for further assistance.

C. We will distribute the Audit Decision Form and approved cover letter as follows.

1. Send the approved Audit Decision Form and transmittal to you. Our grant 

specialist will confirm the date you receive them.

2. Send the Audit Decision Form and transmittal to OPAB. They will send it to 

DOI-OIG for final approval of the resolution.

3. If we must collect any disallowed costs, we will send the transmittal to our 

Division of Financial Management (DFM) for further action

4. File the approved Audit Decision Form and transmittal in our awarding office. It 

should be filed in the audit resolution file as well as in the official file for each 

assistance agreement affected.
D-39

D If we disallow any costs, we will develop a written agreement with you confirming the 

payment plan that is included with the Audit Decision Form. Authorized officials of your 

organization and our awarding office must sign or approve the payment agreement. We 

must send a copy of the approved payment plan to DFM for collection. DFM will initiate 

collection proceedings according to the payment plan. 

E. If the audit decision calls for a follow-up review to confirm that corrective actions have 

been implemented, our grant specialist should schedule and perform the review as soon 

as feasible for the review topic. The grant specialist must notify the official authorized to 

sign our assistance awards and OPAB of the results of the follow-up review.

F. Upon repayment of all identified disallowed costs and implementation of all required 

corrective actions, our awarding office must notify you and OPAB that the audit 

resolution is complete. OPAB must close out the audit in our audit tracking system.

1-180-50 How can you appeal our audit decision?

A. If you do not concur with the awarding office’s decision on an audit finding, whether 

fiscal, or administrative, you may appeal the decision to the RD of the appropriate region. 

1. You must send a formal appeal letter within 30 days after you receive the 

awarding office decision. Your appeal must include the reasons for contesting the 

audit decision and all information necessary for review of the appeal.

2. Our RD should assign a coordinator for the audit appeal process. The coordinator 

should not have been involved in the initial decisions being appealed.

3. The coordinator must provide you with written confirmation that we have 

received your appeal letter within three days of receipt. 

4. If you are appealing disallowed costs, the coordinator must notify DFM that you 

have filed an appeal. DFM will suspend collection procedures during the appeal, 

but late charges will continue to accrue.

5. The coordinator should obtain comments on the appeal from our grant specialist, 

our authorized official who signed the initial audit decision, and from all other 

interested parties. The coordinator will provide to the RD all information needed 

to decide the appeal.

6. The RD will make an initial decision on the appeal within 30 days of receiving 

your appeal. We will not send this initial decision to you. OPAB must concur 

with the decision before it becomes final. We should complete this coordination 

and review process within 30 days. Our final decision is due to you within 60 

days of receiving your appeal. 
D-40

7. If we cannot issue the final decision within 60 days of receiving your appeal, the 

appeal coordinator will notify you and OPAB of the reason for the delay, and the 

revised decision date.

B. If you do not agree with the appeal decision, you may appeal the decision to the Director 

of OSMRE for final resolution.
D-41

Exhibit 1

Audit Decision Form

1. Audit Control Number: 

2. Recipient: 

3. Audit findings resolved: (For each audit finding resolved, show the finding number, the 

agreement number(s), the original finding, the amount of costs questioned, the recipient’s 

response, the resolution decision, and the amount of costs disallowed. Use space “A” 

below for the first finding resolved, and add another letter for each additional finding. 

Expand this section or use additional pages as needed.)

A.

4. Total amount of costs disallowed: $ 

Collection plan: (Fully describe all elements of plan, including schedule for payment(s).)

5. Approvals

Grants Specialist:

 

 Signature Date 

Authorized Approving Official: 

 

 Signature Date 
D-42

Exhibit 2

Sample Decision Transmittal to Recipient

Dear:

The purpose of this letter is to inform you of our resolution of the Single Audit of the State of 

_______, for the period ending _______, dated ________.

Enclosed is the Audit Decision Form detailing the resolution of each audit finding relating to the 

OSMRE assistance agreements.

The disallowed costs resulting from this audit total $_____. Please send a check in this amount 

payable to the Office of Surface Mining Reclamation and Enforcement to the following address 

by no later than [date] . If payment is not received by OSMRE prior to this date, interest 

charges will begin. 

[grants specialist or payment address]

Please prepare revised [final] cost reports for agreements [numbers] , and send them to the 

following address by no later than [date] .

[report address]

If you wish to appeal any of these decisions, an appeal letter must be sent to the following 

address by [due date] .

Director, Regional Office

[address]

You may consider this resolution to be final unless notified otherwise by this office. If the 

Department of the Interior, Office of Inspector General questions any of these decisions, we may 

reopen the audit resolution

If you have any questions or we may be of any assistance, contact [grant specialist] at 

_________.

Thank you for your assistance with this audit resolution.

Sincerely,

[Official authorized to approve agreements]
E-1

Annex E: FAM Part 2 - General Requirements for Federal Assistance

CHAPTER 2-100

USING CONTRACTS, GRANTS AND COOPERATIVE AGREEMENTS

2-100-00 What does this chapter do?

2-100-10 Where do these requirements come from?

2-100-20 Why does it matter whether we use a contract, grant or cooperative agreement? 

2-100-30 What is the difference between procurement and assistance?

2-100-40 What transactions should be contracts?

2-100-50 What transactions should be grants or cooperative agreements?

2-100-60 What is substantial OSMRE involvement during program performance?

2-100-70 What procedures will we follow when we determine whether to use a contract, 

grant or cooperative agreement?

2-100-80 Can a single assistance agreement include both grant and cooperative agreement 

components?

2-100-90 Can we get an exception to this policy?

2-100-100 Can we award an assistance agreement to a single source without competition?

2-100-00 What does this chapter do?

A. This chapter explains how we, the Office of Surface Mining Reclamation and 

Enforcement (OSMRE), determine whether we should use a contract, a grant, or a 

cooperative agreement to award Federal funds. 

B. This chapter also defines procurement and assistance, and explains the differences 

between them. 

C. This chapter does not cover intra-agency or interagency agreements or memoranda of 

understanding. It also does not apply to licenses, sale documents, leases and special use 

permits unless they are for purposes of public support or stimulation.

2-100-10 Where do these requirements come from?

The Federal Grant and Cooperative Agreement Act of 1977, as amended (31 USC 6303) 

establishes the distinctions between Federal assistance relationships, and Federal procurement 

relationships.

2-100-20 Why does it matter whether we use a contract, grant or cooperative agreement? 

Federal law establishes different legal requirements for procurement and assistance relationships. 

If we select the wrong instrument, we will be in violation of the law. Department of Interior 

Inspector General audits have repeatedly found serious problems with misuse of contracts, 
E-2

grants, and cooperative agreements. OSMRE offices must select of the appropriate type of 

agreement. 

2-100-30 What is the difference between procurement and assistance?

A. The main purpose of a procurement action is to acquire property or services by purchase, 

lease, or barter for the use or direct benefit of the Federal government. We use a contract 

as the legal instrument to award a procurement action.

B. The main purpose of an assistance action is to transfer money, property, services, or 

anything of value to the recipient in order to accomplish a public purpose of support or 

stimulation. The agency must have legal authority to award assistance agreements for 

this purpose. We use either grants or cooperative agreements to award assistance funds.

2-100-40 What transactions should be contracts?

A. We must use a procurement contract when our main purpose is to get services or property 

by purchase, lease, or barter, for our use or direct benefit. 

B. We may also use a contract in a specific instance if we determine that an emergency 

project contract is appropriate. This allows us to determine when we can satisfy specific 

public needs best by using the procurement process. However, we cannot use this 

provision to circumvent the legal requirements for use of procurement or assistance 

instruments. This authority must be used only in extraordinary circumstances with the 

approval of the Assistant Director, Program Support (AD-PS) in coordination with the 

Assistant Director, Finance and Administration (AD-F&A).

C. We would normally use contracts for the following purposes.

1. To assess the performance of Federal programs or projects or recipient activity. 

This does not include research of an evaluative character unless we initiate the 

request for its performance.

2. To provide professional or technical support services for us or any third party. 

This does not include services rendered by a state or local government, Indian 

tribe, or professional group to its own constituency or members.

3. To conduct surveys, studies, and research to provide specific information for our 

use or for public release.

4. To conduct training where we select the individuals or groups to be trained or 

specify the content of the curriculum (not applicable to fellowship awards).
E-3

5. To publish or produce materials in any media, except for the results of research 

projects, or the proceedings of scientific conferences, which are not for our use.

6. To design or produce items for our use, or subject to our specifications.

7. To conduct conferences on our behalf.

8. To develop plans, management information, or other data for OSMRE use.

2-100-50 What transactions should be grants or cooperative agreements?

A. We will normally use grants or cooperative agreements for the following purposes:

1. General financial assistance to eligible recipients for a public purpose of support 

or stimulation under specific authorizing legislation.

2. Financial assistance for a public purpose to a specific program activity eligible for 

such assistance under specific authorizing legislation.

B. We use a grant when no substantial involvement is anticipated between us and the 

recipient during the performance of the proposed assistance activities.

C. We use a cooperative agreement when substantial involvement is anticipated between us 

and the recipient during program performance.

D. We will decide whether to use a cooperative agreement or a grant for a specific award 

based on the need for us to have substantial programmatic involvement in the activity. 

E. Some programs require the use of cooperative agreements exclusively, such as the 

Watershed Cooperative Agreement Program. We make this determination for the entire 

program based on statutory requirements or policy level determinations that program 

performance will require substantial Federal programmatic involvement. Other programs 

may use a mix of grants and cooperative agreements, depending on the nature of the 

project or the abilities of the recipient. For example, we may start out a project with a 

cooperative agreement, but use grants in later years if the project no longer needs our 

substantial involvement.

2-100-60 What is substantial OSMRE involvement during program performance?

A. We may consider the following activities as substantial involvement in program 

performance, depending on the specific circumstances.

1. We have an option to halt an activity immediately (for example, if construction 

specifications are not met).
E-4

2. Requiring you to get our approval of one stage of program activity before you can 

begin work on a subsequent stage within the performance period of the assistance 

agreement. However, this example does not suggest the use of cooperative 

agreement when we reserve the right to approve or disapprove a subsequent grant, 

provided each grant is a separate instrument.

3. Approving, or helping you select, recipients of contracts or subgrants you award 

under the assistance instrument, if this level of involvement is required by law or 

authorized by waiver.

4. Helping you select your key personnel. However, a research project which 

provides in the award for the participation of a named principal investigator 

would not by itself justify use of a cooperative agreement.

5. Collaborating or participating jointly with you to perform the program activities.

6. Monitoring performance to provide specific direction or redirection of the work.

7. Setting requirements before the award limiting your discretion over the scope of 

services offered, organizational structure, staffing, mode of operation, and other 

management processes. Closely monitoring or working with you to ensure 

compliance with these requirements beyond the exercise of normal Federal 

stewardship.

B. We do not consider the following activities to be substantial involvement in program 

performance.

1. Approving your plans before we award the agreement.

2. Performing normal Federal stewardship responsibilities during performance to 

ensure that the objectives, terms and conditions of the award are accomplished. 

This could include site visits, and reviewing and responding to your program, 

financial, and audit reports.

3. Reviewing your performance after the project is completed. 

4. Enforcing legal requirements such as civil rights, environmental protection, and 

provisions for the disabled.

5. Enforcing general fiscal and administrative requirements such as those included in 

OMB regulations.
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6. Becoming more involved than we expected because of problems in your program 

or financial performance.

C. We do not consider providing technical assistance, advice, or guidance to you as 

substantial involvement during performance, if any of the following conditions are met.

1. We provide the assistance at your request.

2. We do not require you to follow the advice.

3. We do require you to follow our guidance, but we provide it before the project 

starts and we informed you of this requirement before we awarded the agreement.

2-100-70 What procedures will we follow when we determine whether to use a contract, 

grant or cooperative agreement?

A. Any program announcement, public notice, solicitation, or request for applications or 

proposals must show whether the relationship will be procurement or assistance and 

whether the agreement will be a contract, grant or cooperative agreement. For 

cooperative agreements, the announcement must include an explicit statement of the 

anticipated Federal programmatic involvement.

B. Decisions on whether to use a contract, grant or cooperative agreement must be justified 

and documented in the official file. Our written determinations must contain complete 

information on the nature of the relationship between us and the recipient to justify the 

selection of the award instrument.

C. If major individual transactions or programs contain elements of both procurement and 

assistance in such a way that they cannot be characterized as having a principal purpose 

of one or the other, the awarding office should seek initial guidance from the AD-PS. 

D. We will request guidance from the Office of the Solicitor as needed. Upon request, the 

Solicitor may review new programs or policies, or a proposed cooperative agreement or 

grant which is of such complexity or novelty that it raises issues justifying legal review. 

Cooperative agreements and grant awards issued under well-established programs should 

not require Solicitor review.

2-100-80 Can a single assistance agreement include both grant and cooperative agreement 

components?

Yes, it is acceptable for an agreement to include more than one type of assistance relationship, so 

that some components are funded by grants and others by cooperative agreements. For example, 

a Regulatory Administration & Enforcement grant includes funding for a state’s regulatory 

program and also its Federal lands cooperative agreement. Joint funding agreements are 
E-6

appropriate to simplify application and award requirements or efficient administration of the 

project, or to serve the best interests of the programs. The Joint Funding Simplification Act, P.L. 

97-258 provides the opportunity and authority to participate in jointly funded projects in any 

number of funding relationships.

2-100-90 Can we get an exception to this policy?

A. Yes, we may request an exception from OMB in very rare instances. The Federal Grant 

and Cooperative Agreement Act allows the Director of OMB to exempt individual 

transactions or programs from the Act. OMB grants exceptions only on the basis of 

agency requests that include strong justification based on severe disruption to a program 

or serious consequences to a recipient.

B. A request for an exception should be sent from the Regional Director (RD) to the AD-PS 

and then to the Director of OSMRE. The request must answer the following questions.

1. Is the exception requested for a whole program, a group of awards, or for an 

individual award?

2. Why are we requesting an exception? 

3. What will we do if an exception is not granted, and how will this harm the 

program or recipients?

4. What are the legal or program policy implications of the request?

5. What will we do if the exception expires before there are any changes to the law?

C. OSMRE must send the exception request through the Department of the Interior. The 

Director, in coordination with the Office of the Solicitor, must submit requests through 

the Assistant Secretary, Land and Minerals Management, and the Director, Office of 

Acquisition and Property Management, to the Assistant Secretary, Policy, Management 

and Budget. 

2-100-100 Can we award an assistance agreement to a single source without competition?

A. Yes, a funding opportunity may be specifically directed to a single known recipient. This 

single source recipient may either be named in legislation, or determined by OSMRE 

based on demonstrable criteria such as unique expertise or capacity.

B. We rarely award Federal funds in a single source assistance agreement with no 

competition. If we decide to make a single source award, the decision must be able to 

withstand scrutiny. We must demonstrate in the award file that the award protects the 

public interest, and is in accordance with legal requirements and OSMRE priorities and 
E-7

objectives. 

C. An award without competition must fit one or more of the following standards.

1. An unsolicited proposal, representing a unique or innovative idea, method or 

approach, not the subject of a current or planned assistance award, which will 

benefit program objectives.

2. A continuation or completion of an activity presently being funded, if competition 

would significantly harm the activity. 

3. Legislative intent, demonstrated in law or legislative history, clearly indicating 

Congress’ intent to restrict award to a particular recipient or purpose.

4. A uniquely qualified applicant for the activity to be performed based upon 

demonstrable factors such as technical expertise, location, voluntary support 

capacity, cost-sharing ability, or other unique qualifications.

5. An emergency situation with insufficient time available for competitive 

procedures, due to a substantial danger to health or safety or a compelling and 

unusual urgency

D. We must complete the following actions before awarding a single source award for 

$25,000 or more.

1. Announce a notice of intent to make the award. The announcement may be 

published on Grants.gov, the Federal Register, or any medium which will provide 

transparency.

2. Put a written justification in the award file explaining why competition is not 

practicable, including a statement of which of the above criteria apply and why. 
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CHAPTER 2-110

DEBARMENT AND SUSPENSION

2-110-00 What is debarment and suspension?

2-110-10 Why are people or entities debarred?

2-110-20 What is the System for Award Management (SAM) ?

2-110-30 What will we do to ensure that applicants are eligible?

2-110-40 What is your responsibility as a recipient?

2-110-50 How will we process debarments and suspensions?

2-110-00 What is debarment and suspension?

A. Debarment is an action taken by a Federal agency to exclude a person from participating 

in Federal procurement or non-procurement transactions.

1. A Federal grant or cooperative agreement is considered a non-procurement 

transaction. 

2. A primary transaction is between us, the Office of Surface Mining Reclamation 

and Enforcement (OSMRE), and you, the recipient of our assistance agreement. 

Lower tier transactions are between you and any other entity, including all your 

contracts and subgrants. A person who is debarred cannot participate in either 

primary or lower tier transactions.

B. Suspension is a Federal action which temporarily halts operations under an assistance 

agreement because of a problem. Suspension allows time for corrective action by the 

recipient or the Federal agency’s decision to terminate the agreement.

2-110-10 Why are people or entities debarred?

A Federal agency may debar a person or entity for any of the following reasons.

A. A conviction or civil judgment for fraud, criminal offenses, violation of antitrust statutes, 

embezzlement, theft, forgery, bribery, falsification of records, false claims, obstruction of 

justice or other offenses that indicate a lack of business integrity or honesty.

B. A serious violation of a public agreement that affects the integrity of an agency program, 

such as a willful failure to perform, history of substantial non-compliance, or willful 

violation of statutory or regulatory provisions.

C. Any other cause of so serious or compelling a nature that it affects the participant’s 

present responsibility, including knowingly doing business with an excluded person, or 

failure to pay a substantial debt owed to a Federal agency, or violation of the Drug-Free 

Workplace Act.
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2-110-20 What is the System for Award Management (SAM) ?

The System for Award Management (SAM) is the Official U.S Government system that 

consolidated several independent systems that are used in procurement and financial assistance 

for evaluating the financial worthiness of a contractor or recipient. SAM is a widely available 

source of the most current information about persons who are excluded or disqualified from 

transactions with the Federal government. Federal agencies and recipients may use the SAM. 

The General Services Administration (GSA) maintains the system.

2-110-30 What will we do to ensure that applicants are eligible?

A. OSMRE will not award financial assistance to applicants that are debarred or suspended 

or otherwise excluded from or ineligible for Federal financial assistance. 

B. Our awarding office must check SAM to determine whether a participant or principal is 

excluded before the authorized official approves any grant or cooperative agreement.

2-110-40 What is your responsibility as a recipient?

A. As a recipient, you must determine whether any of your own principals are excluded or 

disqualified. You must also determine if another person or persons at the next lower tier 

with whom you intend to do business is excluded or disqualified. You can make this 

determination in the following ways: 

1. Check SAM.

2. Add a clause or condition to the transaction agreement with that person.

B. You must inform the authorized official at our awarding office if at any time you learn 

that any certifications you may have included in your original application package were 

incorrect when submitted or have since become incorrect.

2-110-50 How will we process debarments and suspensions?

A. We will initiate action when we have adequate evidence to suspect that one of the causes

for debarment or suspension has occurred. For example, an indictment is sufficient 

grounds for initiating a suspension.

B. We will use the following process to initiate debarment or suspension actions.

1. The awarding office must investigate and document information concerning the 

existence of a cause for debarment. The awarding office must forward its 

findings and recommendations to the AD-PS.
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2. The AD-PS will review the information and determine if the recommended action 

is appropriate. The AD-PS will forward the information to the Interior 

Department Office of Acquisition and Property Management for action.

3. The DOI Debarring/Suspending Official will process the debarment action as 

appropriate. See 2 CFR 180 for more information.
E-11

CHAPTER 2-120

DRUG-FREE WORKPLACE REQUIREMENTS

2-120-00 What is the purpose of this chapter?

2-120-10 What transactions do these policies apply to?

2-120-20 What must you do to comply with the drug-free workplace requirements?

2-120-30 How will we determine if you are in violation of the drug-free workplace 

requirements?

2-120-40 What will we do if we determine that you are in violation?

2-120-00 What is the purpose of this chapter?

This chapter explains government-wide, Department of the Interior, and Office of Surface 

Mining Reclamation and Enforcement (OSMRE) policies and procedures for compliance with 

the Drug-Free Workplace Act of 1988. 

2-120-10 What transactions do these policies apply to?

These requirements apply to all the financial assistance agreements awarded by us, OSMRE. 

These requirements do not apply to contracts and subgrants awarded by you, the recipient of our 

grant, or cooperative agreement.

2-120-20 What must you do to comply with the drug-free workplace requirements?

A. You must make a good faith effort on a continuing basis to maintain a drug-free 

workplace. You must agree to do so as a condition for receiving financial assistance. 

Below are three general requirements that should be part of this effort:

1. You must publish a drug-free workplace statement that tells employees that 

unlawful manufacture, distribution, dispensing, possession, or use of a controlled 

substance is prohibited in the workplace. The statement must specify the actions 

you will take against employees for violating that prohibition. The statement 

must also inform employees that, as a condition of employment under any award, 

they must abide by the terms of the drug-free statement and must notify you in 

writing if ever convicted for a violation of a criminal drug statute occurring in the 

workplace. You must give a copy of this statement to all employees working 

under an assistance agreement.

2. You must establish a drug-free awareness program to inform employees about the 

dangers of drug abuse in the workplace, your policy of maintaining a drug-free 

workplace, any available drug counseling, rehabilitation and employee assistance 

programs, and the penalties for drug abuse violations occurring in the workplace. 

You are not required to provide or pay for drug rehabilitation programs.
E-12

3. You must identify all known workplaces under your Federal awards.

B. You must include in your drug-free workplace policy a requirement that employees 

notify you of any criminal drug statute conviction for a violation occurring in the 

workplace within five calendar days. You must notify OSMRE in writing within ten 

days after receiving notice of such a conviction. Within 30 days of notice of an 

employee’s conviction for a drug violation in the workplace, you must take one of the 

following actions:

1. Take appropriate personnel action against the employee, up to and including 

termination.

2. Require the employee to participate satisfactorily in a drug abuse assistance or 

rehabilitation program that is approved by a Federal, state or local health, law 

enforcement or other appropriate agency.

2-120-30 How will we determine if you are in violation of the drug-free workplace 

requirements?

You will be in violation of the drug-free workplace requirements if we find that any of the 

following circumstances have occurred:

A. You violated these requirements.

B. The number of convictions of your employees for violating criminal drug statutes in the 

workplace is large enough to indicate that you failed to make a good faith effort to 

provide a drug-free workplace.

2-120-40 What will we do if we determine that you are in violation?

If our awarding office determines that you are in violation of the drug-free workplace 

requirements, we may take one or more of the following actions.

A. Suspend payments under the award.

B. Suspend or terminate the award.

C. Suspend or debar you from all Federal transactions for a period not to exceed five years. 

See Chapter 2-110 for more information on debarment and suspension actions.
E-13

CHAPTER 2-130

LOBBYING

2-130-00 What is lobbying?

2-130-10 What does this chapter do?

2-130-20 Where do these rules come from?

2-130-30 Are there any exceptions to these rules?

2-130-40 Can you lobby with Federal funds?

2-130-50 What certifications and disclosures must you give us about lobbying?

2-130-60 Are there any penalties for violations of these rules?

2-130-70 What will we do with your certifications?

2-130-00 What is lobbying?

Lobbying is the practice of attempting to influence decisions made by the government. 

2-130-10 What does this chapter do?

This chapter outlines government-wide, Department of the Interior, and Office of Surface 

Mining Reclamation and Enforcement (OSMRE) policies to restrict lobbying.

2-130-20 Where do these rules come from?

The anti-lobbying restrictions were established by the 1990 Department of the Interior and 

Related Agencies Appropriations Act, and subsequently amended by the Lobbying Disclosure 

Act of 1995. The Department of the Interior’s regulations at 43 CFR Part 18 provides a detailed 

description of these requirements.

2-130-30 Are there any exceptions to these rules?

A. These rules do not apply to grants or cooperative agreements with less than $100,000 in 

Federal funds. 

B. These rules do not apply to Indian tribes for expenditures specifically permitted by other 

Federal law.

2-130-40 Can you lobby with Federal funds?

You or your subrecipients must not use Federal funds to pay any person for influencing or 

attempting to influence an officer or employee of any agency, a member of Congress, an officer 

or employee of Congress, or an employee of a member of Congress in connection with the award 

or amendment of any Federal contract, grant, loan or cooperative agreement.

2-130-50 What certifications and disclosures must you give us about lobbying?
E-14

A. If you have made or agreed to make any payment for lobbying efforts using other funds 

which would be prohibited if paid with Federal funds, you must include form SF-LLL, 

Disclosure of Lobbying Activities, with your application. 

B. You must also submit an SF-LLL disclosure form at the end of each calendar quarter in 

which actual payments occur, or when there are changes that materially affect the 

accuracy of the information in your previous disclosure form.

C. If you make any subgrants over $100,000, your subrecipients must submit a certification 

to you. In addition, those subrecipients must submit to you the SF-LLL disclosure form 

for any payment for lobbying using other funds before you make the subawards or 

whenever actual payments or changes occur.

2-130-60 Are there any penalties for violations of these rules?

A. Yes. Any person who makes a prohibited expenditure will be subject to a civil penalty of 

not less than $10,000 and not more than $100,000 for each such expenditure.

B. Any person who fails to file or amend the required disclosure form will be subject to a 

civil penalty of not less than $10,000, and not more than $100,000 for each such failure.

2-130-70 What will we do with your certifications?

A. Our awarding office must collect all lobbying certifications we receive and keep them in 

the official grant or cooperative agreement file.

B. If our awarding office receives any SF-LLL disclosure forms, they must forward them 

immediately to the Assistant Director of Program Support to be included in the OSMRE 

report to the Department.
E-15

CHAPTER 2-140

INTERGOVERNMENTAL REVIEW OF FEDERAL PROGRAMS

2-140-00 What is the purpose of this chapter?

2-140-10 What is the purpose of Executive Order 12372? 

2-140-20 Who must follow intergovernmental review requirements?

2-140-30 What is the process for submitting applications to a state intergovernmental 

review system?

2-140-40 What must you and we do if a state review process makes a recommendation on 

your application?

2-140-50 What if your state does not have a review process or has not selected our 

program for review?

2-140-00 What is the purpose of this chapter?

This chapter describes our procedures to ensure that states and other governmental entities have 

the opportunity to review and comment on proposed financial assistance agreements before we, 

the Office of Surface Mining Reclamation and Enforcement (OSMRE), decide whether to 

approve them. 

2-140-10 What is the purpose of Executive Order 12372? 

A. Executive Order (E.O.) 12372, Intergovernmental Review of Federal Programs, requires 

Federal agencies to provide state officials the opportunity to review and comment on 

proposed Federal financial assistance activities. Federal agencies must consider state 

comments before making a final decision.

B. E.O. 12372 allows a state to establish an intergovernmental review system. The state 

must establish it in an official act of the state. The Office of Management and Budget 

(OMB) must certify that the state’s system is in accordance with OMB directives. A state 

system may select any Federal program or activity for review. 

C. The Department of the Interior’s rule implementing E.O. 12372 is published in 43 CFR 

Part 9, Intergovernmental Review of Department of the Interior Programs and 

Activities. This rule is also incorporated in the Departmental Manual, Part 511, 

Coordination with State and Local Governments. These procedures apply to all of our 

financial assistance agreements.

2-140-20 Who must follow intergovernmental review requirements?

A. Indian tribes are not required to submit applications to state intergovernmental review 

clearinghouses for review.
E-16

B. All other applicants for financial assistance must ensure that their applications meet their 

state’s intergovernmental review requirements. If your state has an intergovernmental 

review process, and if they have chosen to review the OSMRE program you are applying 

for, you must submit your application for their review. 

C. Applications subject to intergovernmental review include new assistance agreements, and 

also amendments to increase funding for current assistance agreements. 

2-140-30 What is the process for submitting applications to a state intergovernmental 

review system?

A. You must submit your application for a new assistance agreement to the state Single 

Point of Contact (SPOC) at least 60 days before the planned award date. You must 

submit a continuation assistance application to the SPOC at least 30 days before the 

planned award date. 

1. For the purposes of intergovernmental review, OSMRE considers regulatory and 

Abandoned Mine Land (AML) grant applications to be continuation grants. AML 

grant applications are not considered new grants because they do not normally 

include information on specific proposed reclamation projects.

2. To assure proper timing of reviews by the state system, you should indicate in 

your application (on the SF 424 form, item 8, Type of Application) whether the 

application is for a continuation grant, or a new assistance agreement.

B. You must provide evidence to us in your application that you provided the state system 

opportunity to comment on your proposal. You can show this on the SF 424 in Item 16, 

“Is Application Subject to Review by State E.O. 12372 Process?" and also in Item 3, 

“Date Received by State” and “State Application Identifier.”

2-140-40 What must you and we do if a state review process makes a recommendation on 

your application?

A. The state SPOC may send state process recommendations to us or to you. If you receive 

any recommendations or comments about your application from your state SPOC, either 

before or after we have awarded your agreement, you must send them immediately to the 

OSMRE office that received your application.

B. We must make efforts to accommodate intergovernmental concerns by one of the 

following actions.

1. Accept the recommendation.

2. Reach a mutually agreeable solution with the state process.
E-17

3. Provide the state SPOC with a written explanation of our decision before we take 

any other action on the proposal. 

2-140-50 What if your state does not have a review process or has not selected our 

program for review?

A. In the absence of E.O. 12372 requirements, the consultation provisions of the 

Intergovernmental Cooperation Act of 1968 apply to your application. The Act requires 

us to notify affected state, area-wide and regional agencies, and local governments 

directly of our proposed actions. Our awarding office must send notices of intent, which 

include a description of the proposed financial assistance, a due date for responses, which 

allows at least 60 days for a new award or 30 days for a continuation, and how to contact 

us.

B. Under this Act, we are only required to consider the recommendations of 

intergovernmental agencies and officials. We are not required to accommodate their 

concerns, explain our decision, or provide prior notifications of other actions. However, 

we will try to work with all interested parties to respond to their concerns.
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CHAPTER 2-150

ANTI-DISCRIMINATION IN FEDERALLY ASSISTED PROGRAMS

2-150-00 What is the purpose of this chapter?

2-150-10 Where do these requirements come from?

2-150-20 What does our Public Civil Rights Program do? 

2-150-30 What must you do?

2-150-40 What happens if we discover discrimination in your Federally assisted program?

2-150-00 What is the purpose of this chapter?

This chapter describes our procedures to ensure compliance with Title VI of the Civil Rights Act 

of 1964 and other anti-discrimination laws. The requirements in this chapter apply to all 

applications and awards for OSMRE grants and cooperative agreements.

2-150-10 Where do these requirements come from?

Our civil rights program is authorized by the following laws, regulations, and executive orders. 

A. Civil Rights Act of 1964, Title VI (P.L. 88-352; 42 U.S.C. 2000d 2000d-4). 

B. Rehabilitation Act of 1973 (P.L. 93-112; 29 U.S.C. 794) as amended.

C. Education Amendments of 1972, Title IX (P.L. 92-318; 86 Stat. 235; 373) as amended.

D. Age Discrimination Act of 1975, as amended, (P.L. 94-135, Title III; 42 U.S.C. 6101 et 

seq.). 

E. Americans with Disabilities Act of 1990 (P.L. 101-336) with the Department of Justice 

(DOJ) regulations at 28 CFR 35, including the Americans with Disabilities Act, Title II.

F. Executive Order (E.O.) 12898, Federal Actions to Address Environmental Justice in 

Minority Populations and Low-Income Populations. 

G. E.O. 13166, Improving Access to Services for Persons with Limited English Proficiency 

(LEP). 

2-150-20 What does our Public Civil Rights Program do? 

A. Our Public Civil Rights program ensures that we comply with Title VI of the Civil Rights 

Act. Title VI prohibits discrimination in Federally funded programs based on race, color, 

or national origin. Title VI protects against a broad range of discrimination, including 

denial of services; differences in the quality, quantity, or manner of services; different 

standards for participation; and discrimination in an activity conducted in a facility built 
E-19

with Federal funds.

B. Congress authorized Federal agencies to enforce Title VI to prevent recipients from using 

Federal funds to support discrimination. Our Public Civil rights program works with 

states and educational institutions which receive OSMRE financial assistance. 

C. The Public Civil Rights program ensures that following objectives are met. 

1. Members of the public who participate in programs and activities that we fund 

have equal access to those programs and activities, and the facilities where the 

programs take place.

2. Recipients of Federal financial assistance, particularly states, do not exclude 

people from any program, activity or facility, or deny them benefits, or otherwise 

discriminate against them on the grounds of race, color, national origin, age, 

disability, or sex. 

2-150-30 What must you do?

A. You must comply with all Federal statutes and requirements relating to 

nondiscrimination.

B. Your application for financial assistance must include assurances that you will comply 

with all nondiscrimination requirements. You must complete either the Assurances for 

Non-Construction Programs, Standard Form (SF) 424B, or the Assurances for 

Construction Programs, SF 424D. 

2-150-40 What happens if we discover discrimination in your Federally assisted program?

A. If OSMRE discovers discrimination, we will work with you to ensure that discriminatory 

policies or practices are changed in a timely manner.

B. If you do not work voluntarily to eliminate the discrimination, we may refer the matter to 

the Departmental Office of Civil Rights for enforcement actions which may include the 

following sanctions.

1. Termination of your financial assistance agreements.

2. Referral to the Department of Justice for civil enforcement through Federal 

courts.
E-20

CHAPTER 2-200

PROPERTY

2-200-00 What does this chapter do?

2-200-10 Where do these policies come from?

2-200-20 What is property?

2-200-30 What is equipment?

2-200-40 Who holds title to equipment acquired under an assistance agreement?

2-200-50 How must states manage equipment?

2-200-60 How must recipients other than states manage equipment?

2-200-70 How must you manage any Federally-owned equipment we provide to you?

2-200-80 When does OSMRE have the right to transfer title to equipment?

2-200-90 How must you manage supplies?

2-200-100 Can you acquire land with OSMRE funds?

2-200-110 What specific rules apply to real property acquired land with AML grant 

funds?

2-200-120 What specific rules apply to real property acquired with Watershed 

Cooperative Agreement funds?

2-200-130 How must you manage real property?

2-200-00 What does this chapter do?

This chapter explains the policy and procedures for the use, management, and disposition of real 

property, equipment and supplies purchased by you, the recipient, under an assistance agreement 

from us, the Office of Surface Mining Reclamation and Enforcement (OSMRE).

2-200-10 Where do these policies come from?

Requirements for the use, management, and disposal of real property, supplies, and equipment 

acquired under your assistance agreement are established in the Uniform Administrative 

Requirements, Cost Principles, and Audit Requirements for Federal Awards at 2 CFR Part 200, 

Subpart D.

2-200-20 What is property?

Property is any tangible item which is acquired or held through an assistance agreement. Real 

property is land, including buildings, and improvements fixed on the land. Personal property is 

all other property except real property. 

2-200-30 What is equipment?

We define equipment as nonexpendable personal property with a useful life of more than one 

year and an acquisition cost of $5,000 or more per unit. Alternatively, you may use your own 
E-21

definition of equipment as long as your definition includes all property, which would be 

considered equipment under our definition.

2-200-40 Who holds title to equipment acquired under an assistance agreement?

Title to equipment you acquire under an assistance agreement will vest in the non-federal entity 

upon acquisition, subject to the obligations and conditions in this chapter.

2-200-50 How must states manage equipment?

States will use, manage, and dispose of equipment acquired under an assistance agreement in 

accordance with state laws and procedures.

2-200-60 How must recipients other than states manage equipment?

A. If you are not a state government, you must follow these requirements regarding the use 

of equipment:

1. You must use equipment in the program or project for which you acquired it, as 

long as it is needed. This applies to whether or not the program continues to be 

supported by Federal funds. When you no longer need the equipment for the 

original program, you may use the equipment for other activities currently or 

previously supported by a Federal agency.

2. You may also make equipment available for use on other programs or projects 

currently or previously supported by the Federal government. That use must not 

interfere with the work on the program for which the equipment was acquired. 

You must give other programs or projects supported by OSMRE first preference 

for other use. You should consider charging user fees if appropriate.

3. You must not use equipment acquired with assistance funds to provide services 

for a fee to compete unfairly with private companies that provide equivalent 

services, unless specifically authorized by Federal statute.

B. Your procedures for managing equipment must meet the following minimum 

requirements:

1. You must maintain property records that include:

a. A description of the property

b. A serial number or other identification number

c. The source of the property

d. Who holds title?

e. The acquisition date
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f. Cost of the property

g. Percentage of Federal participation in the cost of the property

h. The location, use and condition of the property

i. Disposition data including the date of disposal and the sale price of the 

property.

2. You must take a physical inventory of property and reconcile the results with your 

property records at least once every two years. You must provide us a copy of the 

results of your physical inventory and reconciliation.

3. You must develop a control system to ensure adequate safeguards to prevent loss, 

damage or theft of the property. You must investigate any loss, damage, or theft 

which occurs, and provide the results of your investigation to us.

4. You must develop adequate maintenance procedures to keep the property in good 

condition.

C. You must dispose of original or replacement equipment when you no longer need it for 

the original program or for other activities currently or previously supported by a Federal 

agency. You must dispose of the equipment according to the following rules. You must 

inform us of the disposition action you will take.

1. You may keep, sell, or otherwise dispose of Items of equipment with a current per 

unit fair market value of less than $5,000 with no further obligation to us.

2. You may keep or sell items of equipment with a current per unit fair market value 

of $5,000 or more after compensating us. To calculate the amount to pay us, 

apply our percent share of the original cost to the current fair market value of the 

equipment.

3. If you sell equipment, you must establish proper sales procedures to ensure the 

highest possible return.

4. If you fail to take appropriate or timely disposition actions, we may direct you to 

take the appropriate actions.

D. When you replace equipment, which is no longer serviceable or efficient, you may use 

the old equipment as a trade-in, or sell it and use the proceeds to purchase replacement 

equipment. You must meet the following requirements:

1. The replacement equipment must serve the same function as the original 

equipment; however, the equipment does not necessarily have to be of the same 

type, grade or quality.
E-23

2. If you trade in or sell the equipment, the value credited for it must be comparable 

to its fair market value.

3. The sale of the equipment and purchase of its replacement must occur close 

enough in time to show that the two events are related; however, you may 

purchase the replacement equipment before you sell the original equipment.

4. Replacing equipment in this way is not a disposition of the equipment. You are 

not required to compensate OSMRE for the Federal share of the equipment at the 

time of replacement. Instead, the Federal share of the original equipment will be 

transferred to the replacement equipment with an appropriate adjustment as 

follows.

a. Apply the percentage of Federal share in the cost of the old equipment to 

the proceeds from its sale or the amount credited for trade-in to set a dollar 

amount for Federal share of the proceeds.

b. Use the dollar amount of the Federal share of the proceeds to reduce the 

Federal share of the cost of the replacement. 

c. If the Federal share of the proceeds is greater than the Federal share of the 

cost of the replacement, you may use the excess funds to reduce the 

Federal share of the grant. Otherwise you must return the excess funds to 

OSMRE.

2-200-70 How must you manage any Federally-owned equipment we provide to you?

If we provide any Federally-owned equipment to you, the following rules apply.

A. Title to the equipment will remain vested in the Federal government.

B. You must manage the equipment under the same requirements as equipment you acquired 

through the assistance agreement.

C. You must complete an inventory list annually and send it to the awarding OSMRE office. 

To report, use the Tangible Personal Property Report (SF-428). This report allows for 

you to provide an inventory list the inventory in any format which gives us enough 

information to determine the status of the equipment. 

D. When your project no longer needs the equipment, you must request disposition 

instructions from OSMRE.

2-200-80 When does OSMRE have the right to transfer title to equipment?
E-24

OSMRE reserves the right to transfer title of any equipment acquired through an OSMRE 

assistance agreement to the Federal government or to a third party named by OSMRE. Such 

transfers will be subject to the following requirements.

A. We must identify the specific piece of property to you in writing. We will give you this 

notice in the award document or as soon as possible after we approve the equipment 

purchase so that you can note this restriction in your property management system.

B. We will issue disposition instructions within 120 calendar days of the end of the 

assistance agreement in which you acquired the equipment. If we fail to issue disposition 

instructions in this period, you may follow normal equipment disposition procedures.

C. When we transfer title to the equipment, we will pay you an amount calculated by 

applying the percentage of your participation in the purchase to the current fair market 

value of the property.

2-200-90 How must you manage supplies?

Supplies are items of personal property which do not meet the criteria for equipment. Items 

which have a useful life of less than one year or cost less than $5,000 per unit are supplies. You 

must meet the following requirements when managing supplies.

A. Title to supplies acquired under an assistance agreement will vest in you upon 

acquisition.

B. You must purchase supplies only in amounts you reasonably expect to be needed for the 

period of the OSMRE-funded assistance agreement. 

C. Although you do not have to account for supplies as you do for equipment, you must 

maintain adequate records to document the purchase, receipt, cost, and use of supplies in 

accordance with good management practices.

D. You may have unused supplies left at the end of the award. If their total fair market 

value is over $5,000 and you do not need the supplies for other Federally-sponsored 

programs or projects, you must compensate us for the Federal share. To calculate the 

amount to pay OSMRE, apply our percentage share in the original cost to the fair market 

value of the supplies.

2-200-100 Can you acquire land with OSMRE funds?

Yes, you may use OSMRE assistance funds to acquire land or other real property. You must 

meet the following requirements.
E-25

A. You must have our specific approval before you spend any funds to acquire real property. 

Our approval decision will be made by the OSMRE official who is authorized to award 

your assistance agreement. 

B. You will hold title to all real property. Title vests in your organization upon acquisition. 

You must not encumber your title or interests in real property. 

C. If you are acquiring real property for use by your program, see 2 CFR Part 200.

D. If you are acquiring land for reclamation using AML or Watershed Cooperative 

Agreement funds, you must follow the program-specific rules below.

2-200-110 What specific rules apply to real property acquired land with AML grant 

funds?

In most cases, you do not need to acquire land in order to reclaim it. We do not encourage the 

purchase of sites with coal or coal refuse because that may result in your having to provide for 

long-term water treatment. However, on rare occasions you may find it necessary to acquire 

land in order to reclaim it. You must meet the following requirements to acquire land.

A. The land to be acquired must be adversely affected by past coal mining practices and 

acquisition must be necessary for successful reclamation. The land must also serve 

recreation, historic, or conservation purposes after reclamation. It must also have 

permanent facilities for reclamation of mining impacts or preventing future damage to the 

land, such as a relocated stream channel, or diversion ditch. You may acquire coal refuse 

disposal sites, including the coal refuse.

B. We must agree that the land acquisition is necessary for reclamation, and specifically 

approve the purchase in advance. 

C. You must use funds from sources other than AML grants to pay at least 10% of the 

acquisition cost of the land. 

D. You must follow the provisions in sections 407 and 409 of SMCRA, OSMRE regulations 

at 30 CFR Part 879, and the Uniform Relocation Assistance and Real Property 

Acquisitions Policies Act of 1970 (P.L. 91-646) for the acquisition, use and disposition of 

the land. 

2-200-120 What specific rules apply to real property acquired with Watershed 

Cooperative Agreement funds?

Sites for the construction of AMD treatment facilities are usually on private lands. In most 

cases, you can get the landowner’s permission to use the property for AMD treatment. Often, 

you may get an easement from the landowner for perpetual use of the property for the treatment 
E-26

facility. However, on rare occasions the landowner will not agree to install the treatment facility, 

and you may have to acquire the land in order to do your project. The owner may want to 

transfer ownership of the project site to you at fair market value or some lower price. 

A. You must demonstrate to us that acquisition of the property is necessary to achieve the 

goals of your project, and that other options such as easements or a different location are 

not viable.

B. You may use up to 50% of the amount of our watershed cooperative agreement funding 

for the purchase of the land, and related expenses. 

C. You must pay at least 10% of the cost of the property with funds from sources other than 

the AML Fund.

D. You must follow the provisions of Section 407 of SMCRA and 30 CFR Part 879. 

E. The future property owner must be your organization, another approved 501(c)(3) nonprofit group, or the state.

F. OSMRE’s contribution to the purchase price of the property must not exceed the 

appraised fair market value.

G. The property appraisal should be prepared by a state-certified real estate appraiser. The 

appraiser should be certified for general property appraisals, not just for residential 

properties. 

H. You must send the appraisal through our Clean Streams Coordinator to the regional 

office appraiser for review. The regional appraiser must accept the appraisal before you 

spend watershed cooperative agreement funds to purchase the property.

I. The deed of transfer must specify that the property will be used for the purposes of the 

project and/or recreation, conservation, or environmental education purposes in 

perpetuity. If the original owner organization dissolves or is unable to continue 

managing the property as intended, the property must be transferred to another non-profit 

organization with similar goals. The new owner organization must continue to operate, 

and maintain the property as appropriate.

J. The deed of transfer must specify that if the owner determines the property is no longer 

needed for the purposes stated in the deed, the owner will notify and consult with 

OSMRE for appropriate disposition instructions.

2-200-130 How must you manage real property?
E-27

A. You can manage real property acquired in whole or in part with OSMRE funds for the 

originally authorized purposes as long as it is needed for those purposes. This rule 

applies even if the program or project is no longer supported by Federal funds.

B. When you no longer need the real property for the original purpose, you must request 

disposition instructions from us. We will give you disposition instructions using one of 

the following options.

1. You may keep title to the property after compensating us. To calculate the 

amount to pay us, apply the OSMRE percentage share in the original cost to the 

current fair market value of the property.

2. You may sell the property and compensate us. To calculate the amount to pay us, 

deduct your actual and reasonable selling and fix-up expenses from the proceeds 

of the sale of the property. Apply the OSMRE percentage share in the original 

cost to the net proceeds. You must use sales procedures that provide for as much 

competition as practicable, and result in the highest possible return.

3. You may transfer title to us or to a third party we name or approve. We will pay 

you compensation calculated by applying your percent share in the original cost to 

the current fair market value of the property.
E-28

CHAPTER 2-210

PROGRAM INCOME

2-210-00 What does this chapter do?

2-210-10 Where do these policies come from?

2-210-20 What is program income?

2-210-30 Should you try to earn program income? 

2-210-40 What methods do Federal regulations provide for using program income?

2-210-50 How must you account for program income?

2-210-60 What specific rules apply to program income earned from a regulatory grant?

2-210-70 What specific rules apply to program income earned from an AML grant?

2-210-80 How must you use program income from all other OSMRE assistance 

agreements?

2-210-00 What does this chapter do?

This chapter explains our policies on program income generated by any grant or cooperative 

agreement we award. This chapter defines program income, and describes how you, the 

recipient, must manage and use it. 

2-210-10 Where do these policies come from?

Our policies about earning, reporting, and using program income come from Uniform 

Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, at 2 

CFR Part 200, Subpart D.

2-210-20 What is program income?

A. Program income is the gross income earned by you that is directly generated by a 

supported activity or earned as a result of the Federal award during the period of 

performance. 

B. The following types of income are examples of program income. Note that this is not a 

complete list. Other items not included here may also be program income:

1. Fees you receive for services you perform.

2. Revenue from sale of products made under an assistance agreement, such as 

publications.

3. Fees to rent or use equipment or real property you acquired with assistance funds.

4. Income from permit fees.
E-29

5. Insurance premiums received under the Subsidence Insurance program.

C. We do not consider the following types of income to be program income:

1. Proceeds from the sale of real and personal property, either purchased through an 

assistance agreement or provided by us, are not program income. See Chapter 2-

200 for property disposition rules.

2. Credits applied against expenditures, such as a rebate on an equipment purchase, 

are reductions of costs rather than program income. These credits must be applied 

to the related cost to reduce the expense charged to the assistance agreement.

3. Income from fines, penalties and forfeitures collected by a state or tribal coal 

regulatory authority are not program income. You should use these funds to 

improve quality of life and the environment in the state or on tribal lands.

4. Tax revenues dedicated to the purposes of your program are not program income.

5. Tuition and related fees received by an institution of higher education for a 

regularly offered course taught by an employee paid under an assistance 

agreement are not program income.

2-210-30 Should you try to earn program income? 

Yes. We encourage you to earn program income in order to reduce program costs. 

2-210-40 What methods do Federal regulations provide for using program income?

A. The Code of Federal Regulations at 2 CFR Part 200, Subpart D, provides three methods 

for treating program income from Federal assistance agreements:

1. The Deduction method uses program income to reduce program costs. Program 

income must be deducted from total allowable costs to determine net allowable 

costs. The net allowable costs are then divided into Federal and non-Federal 

shares according to the percentages in the award. Under this method, program 

income reduces your and our costs for the program. The total program budget 

does not increase. 

2. The Addition method adds program income to the Federal and non-Federal funds 

already awarded to increase the total program budget. 

3. The Cost sharing or matching method allows you to use all program income to 

meet your cost sharing or matching requirements under the assistance award. 
E-30

This method reduces your costs for the program. The Federal cost and the total 

program budget do not change. 

B. Your grant or cooperative agreement award, and our rules for the program under which 

we awarded it, will specify which of these three methods you must use. 

2-210-50 How must you account for program income?

A. You are accountable for the program income you receive. 

B. You must use program income funds according to your assistance agreement and the 

treatment method authorized for your program.

C. You must report program income from all sources on your interim and final financial 

reports.

D. You must keep records of program income in the same manner as required for funds 

provided by the assistance agreement. You must maintain financial records of program 

income receipt, and disposition adequate to track and audit such income. 

2-210-60 What specific rules apply to program income earned from a regulatory grant?

A. You must use program income from regulatory program grants to meet your required 

match, under the Cost-sharing or matching method.

B. If you earn more program income than the required match, or if your regulatory grant 

does not require match, you may choose either of the following options. 

1. You may use the Addition method, adding the excess program income to the 

Federal and non-Federal funds already committed to the regulatory program in the 

grant agreement to increase the total program budget. You must use the 

additional funds for the purposes and under the conditions of the regulatory grant 

agreement.

2. You may use the Deduction method, using the excess program income to reduce 

the Federal share of regulatory program costs.

C. You must report all program income earned and expended, and the method used, in your 

final financial report.

 

D. For income from permit fees paid to the state or tribe by coal mine operators, you may 

choose either to report all of the fees you received in the current grant, or to distribute the 

fee income equally to the regulatory grants in effect during the duration of the approved 

permit.
E-31

 

E. Considering all sources of funds you receive as a result of a regulatory grant (Federal 

grant funds, permit fees, etc.), you must not realize a "profit" by receiving more income 

under a grant than you spent on the regulatory program. 

2-210-70 What specific rules apply to program income earned from an AML grant?

A. Program income includes fees from any user charge related to land reclaimed under Title 

IV of SMCRA, after expenditures for maintenance have been deducted.

B. Program income includes donations by persons, corporations, associations and 

foundations for the purpose of Title IV. You must account for donations properly.

C. You must use program income from an AML grant by the Deduction method except for 

the specific types of income listed below. Under the Deduction method, you apply the 

program income to AML expenditures to reduce the Federal cost.

1. You must use Subsidence Insurance premiums under the Addition method to 

increase the funding of the Subsidence Insurance Program. You should consider 

the insurance premiums to be paid out when you determine how to use the funds 

to further the objectives of the Subsidence Insurance Program.

2. Interest earned from AML set-aside trust funds is not considered to be program 

income. Set-aside funds and interest are considered to be state or tribal funds. 

You may keep them and spend them to achieve the goals of the Set-Aside 

Program.

2-210-80 How must you use program income from all other OSMRE assistance 

agreements?

You should use the Deduction method for program income from any OSMRE assistance 

agreement except regulatory and AML grants. Apply the income to total expenditures, reducing 

the final cost of the program.
E-32

CHAPTER 2-220

MATCHING AND COST SHARING

2-220-00 What does this chapter do?

2-220-10 Where do these policies come from?

2-220-20 What is match?

2-220-30 What costs may you use to meet match requirements?

2-220-40 May you use OSMRE funds as match for other Federal assistance agreements?

2-220-50 May you use costs paid from program income to meet match requirements?

2-220-60 What in-kind contributions may be used as match?

2-220-70 How should you value contributions of volunteer or staff services, supplies, and 

loaned or donated land, buildings and equipment to meet match requirements?

2-220-80 Can you claim a contribution as a direct cost if you charge similar costs to 

indirect costs? 

2-220-90 What policies apply to indirect costs used as match?

2-220-00 What does this chapter do?

This chapter explains match requirements in assistance agreements awarded by us, the Office of 

Surface Mining Reclamation and Enforcement (OSMRE), and how you, the recipient, can meet 

them.

 

2-220-10 Where do these policies come from?

A. Policy Federal share and recipient share costs are found in from the Uniform 

Administrative Requirements, Cost Principles, and Audit Requirements for Federal 

Awards, at 2 CFR 200, Subpart D. 

B. The level of match required for a specific assistance program is set by legislation or 

agency regulations or directives. For example, the Surface Mining Control and 

Reclamation Act (SMCRA) require states to provide 50% match for regulatory program 

administration and enforcement (A&E) grants for work on non-Federal lands. 

2-220-20 What is match?

Some assistance programs require costs to be shared between Federal funds and non-Federal 

funds. Match is the level of non-Federal support which is required for your program or in your 

assistance agreement.

2-220-30 What costs may you use to meet match requirements?

A. You may satisfy matching and cost sharing requirements by either or both of the 

following:
E-33

1. Pay for allowable costs of your program with funds from your organization, nonFederal grants, or other cash donations.

2. Use in-kind contributions from third parties for your program.

B. You may not meet a match requirement with costs paid by another Federal assistance 

agreement unless using those particular funds as match is specifically authorized by law.

C. You may not consider a cost or contribution as match for your OSMRE agreement if it 

has been used to match another Federal assistance agreement or any other award of 

Federal funds. You may prorate a cost or contribution between two or more Federal 

agreements as long as no costs are claimed more than once.

D. Your records must document the costs and contributions you report as match. The records 

must show how you calculated the value placed on in-kind contributions.

2-220-40 May you use OSMRE funds as match for other Federal assistance agreements?

A. You cannot use costs paid by OSMRE under any assistance agreement or contract to 

meet match requirements of other Federal agreements unless that use is specifically 

authorized by law.

B. Appropriations laws for some fiscal years allow you to use Abandoned Mine Land 

(AML) program funds as non-Federal match for projects funded by other Federal 

agencies for environmental restoration related to treatment or abatement of acid mine 

drainage from abandoned mines. The projects must be consistent with the purposes and 

priorities of SMCRA. For guidance on the status of specific AML funds you wish to 

use as match for other Federal assistance, contact the OSMRE office which awarded your 

grant. 

C. You may use AML set-aside funds and interest earned on those funds as match for other 

Federal assistance programs. The purposes of the other program must be consistent with 

the purpose of the set-aside account.

2-220-50 May you use costs paid from program income to meet match requirements?

A. You may not use costs paid with program income as match unless we have approved that 

use for the program income you earn.

B. You may use costs paid with program income generated from a regulatory A&E grant to 

meet the match requirement of the grant. 

2-220-60 What in-kind contributions may be used as match?
E-34

A. You may use goods and services donated to your program to meet match requirements 

only if the contribution is necessary for your program activities and the cost would be 

allowable if you paid it in cash.

B. You may use a third party in-kind contribution to a fixed-price contract as match only if it 

results in a cost savings for you, or an increase in the services or property provided under 

the contract at no additional cost to you.

2-220-70 How should you value contributions of volunteer or staff services, supplies, and 

loaned or donated land, buildings and equipment to meet match requirements?

A. Volunteer services. You should value services provided to your program by volunteers at 

rates consistent with what you pay employees doing similar work. If you do not have 

employees doing similar work, use what other employers in your area pay for similar 

work. You may include a reasonable amount of fringe benefits. Your records must 

support and document volunteer services, to the extent feasible, by the same methods that 

you use for employees performing similar work. 

B. Employees of other organizations. When another organization contributes the services of 

an employee to do their normal type of work at no cost, you should value these services 

at the employee's regular rate of pay (excluding the employer's fringe benefits and 

overhead costs). If the employee is not doing their normal work, you should value their 

services under the volunteer services rule above. 

C. Donated supplies. Value donated supplies at the fair market value of the supplies at the 

time you receive them. 

D. Loaned equipment or space. If a third party donates the use of equipment or building 

space they own, you should value the contribution at the fair market rental value of the 

equipment or space.

E. Donated equipment, buildings and land. If a third party donates equipment, building or 

land, and gives you title to the property, the amount you can claim as match depends on 

whether the grant is for capital or operating expenditures.

1. If the purpose of the grant is to acquire equipment, buildings or land, you may 

claim the total market value of the property at the time of donation. However, if 

any part of the donated property was acquired with Federal funds, you may use 

only the non-Federal share of the property as match.

2. If the purpose of the grant is to support activities that require the use of 

equipment, buildings or land, one of the following rules apply:
E-35

a. You may claim depreciation or a use allowance based on the fair market 

value of the donated property. You must determine and allocate the 

depreciation or use allowance following OMB cost principles as if you 

had purchased the property at the fair market value. 

b. You may request our approval to claim the fair rental rate of the donated 

land or the full market value of the equipment or buildings at the time it is 

donated as match. We will approve your request only if we would have 

approved your purchase of the equipment or building or actual rental of 

the land as an allowable direct cost. If any part of the donated property 

was acquired with Federal funds, you may use only the non-Federal share 

of the property as match.

3. In some cases you must determine the fair market value of land or a building, or 

the fair rental rate of land or space in a building. We may require you to have the 

market value or rate set by an independent appraiser and to have an authorized 

official of your organization certify the value or rate before we accept these costs 

as match.

2-220-80 Can you claim a contribution as a direct cost if you charge similar costs to 

indirect costs? 

You must classify a contribution as a direct or indirect cost in the same way you classify similar 

costs which you charge to Federal funds. So if you treat items such as rent, utilities and 

accounting as indirect costs when you develop your indirect cost rate, then you may not claim 

contributions in these categories as direct costs. Similarly, if you already own facilities and 

equipment, you may not count their use as a direct cost contribution to the program if 

depreciation or use charges for the property are included in the indirect cost rate.

2-220-90 What policies apply to indirect costs used as match?

A. You may accept in-kind contributions of goods and services that would have been 

indirect costs if you had to pay for them. You may use indirect cost contributions as 

match only if your approved indirect cost rate includes the value of the contributions.

B. If you have multiple indirect cost rates, the requirement for consistent classification of 

costs applies separately to the activities covered by each rate. For example, if you have 

approved rates for "onsite" and "offsite" activities, you may charge the costs of renting 

offsite facilities to offsite activities as a direct cost even if you treat facility costs as 

indirect costs for onsite activities.

C. If we negotiate your indirect cost rate, we will only negotiate "offsite" or other special 

indirect cost rates if they are justified under the applicable cost principles. We will not 

establish special indirect cost rates just for cost sharing or matching arrangements.
E-36

CHAPTER 2-230

PROCUREMENT GUIDELINES

2-230-00 What does this chapter do?

2-230-10 Where do these policies come from?

2-230-20 What is procurement?

2-230-30 What procurement rules must states follow? 

2-230-40 What procurement rules must recipients other than states follow?

2-230-50 What provisions must you include in contracts?

2-230-60 Do the Davis-Bacon Act and Contract Work Hours and Safety Standards Act 

apply to contracts supported with OSMRE funds?

2-230-00 What does this chapter do?

This chapter provides guidelines for procurement with funds from assistance agreements 

awarded by us, the Office of Surface Mining Reclamation and Enforcement (OSMRE) to you, 

the recipient. The purpose of this guidance is to ensure that you get the materials and services

your project needs efficiently and appropriately. 

2-230-10 Where do these policies come from?

Requirements for procurements with Federal funds are found in Federal laws and the Uniform 

Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, at 2 

CFR Part 200, Appendix II. 

2-230-20 What is procurement?

Procurement is the act or process of purchasing the services and goods your program needs.

2-230-30 What procurement rules must states follow? 

You must use the same policies and procedures you use for procurements with state funds. You 

must ensure that every purchase order or contract includes any clauses required by Federal 

statutes, executive orders and regulations. 

2-230-40 What procurement rules must recipients other than states follow?

You, a recipient other than a state, will use your own procurement procedures based on state and 

local laws and regulations. However, the procurements must follow applicable Federal law and 

the standards in 2 CFR Part 200 Subpart D. These standards include the following requirements.

A. Your system must ensure that procurements are effective, efficient and economical. Plan 

and carry out procurement transactions so as to provide full and open competition. 

Analyze proposed procurements to ensure that they are necessary and the cost is 
E-37

reasonable. Consider alternative sources and methods to reduce costs. Make awards 

only to responsible contractors with the ability to perform successfully. Maintain a 

contract management system which ensures that contractors perform in accordance with 

the terms of the contract. 

B. You must ensure that no employee, officer or agent of your organization with a conflict 

of interest, real or apparent, will participate in the selection, award, or administration of a 

contract.

 

C. You must settle all contractual issues in accordance with good administrative practice and 

sound business judgment. We will not step in and substitute our judgment for yours 

unless the matter is primarily a Federal concern. You must refer violations of law to the 

local, state, or Federal authority with jurisdiction.

D. You must have a protest procedure to resolve procurement disputes. You must inform us 

of protests. A protestor must exhaust all of your administrative remedies before pursuing 

a protest with us. We will review protests of your contracts only if there is a violation of 

Federal law or regulations, or a violation of your protest procedures.

E. You must maintain records detailing the significant history of each procurement 

action. These records must include, but are not limited to, the reason for selecting the 

method of procurement and the type of contract, contractor selection or rejection, and the 

basis for the price.

2-230-50 What provisions must you include in contracts?

A. Both your contracts and the contracts of your sub-recipients must include the following 

provisions:

1. All contracts must include notice of OSMRE requirements and regulations about:

a. Reporting.

b. Copyrights and rights in data.

c. Patent rights for any discovery or invention which arises or is developed 

under the contract.

2. All contracts must require contractors to keep all records, paper or electronic, 

which are pertinent to the contract. Contractors must retain all required records 

for three years after you make final payments and close all pending matters. 

Contractors must allow you, us, the Department of the Interior, the Comptroller 

General of the United States, or any authorized representatives, access to all 
E-38

records for the purpose of making audit, examination, excerpts, and 

transcriptions.

3. All contracts must recognize mandatory standards and policies relating to energy 

efficiency contained in the state energy conservation plan issued in compliance 

with the Energy Policy and Conservation Act (P.L. 94-163, 89 Stat.871).

4. All contracts over the small purchase threshold must include administrative, 

contractual, or legal remedies for contractors who violate contract terms, and 

provide appropriate sanctions and penalties.

5. All contracts over $10,000 must include provisions that allow you to terminate the 

contract for cause or for convenience. They must include notice of your 

termination procedures.

6. All construction contracts and subcontracts over $10,000 must require compliance 

with Executive Order (E.O.)11246, Equal Employment Opportunity, E.O. 11375, 

and related Department of Labor regulations (41 CFR Part 60).

7. All contracts for construction or repair must require compliance with the 

Copeland "Anti-Kickback" Act (18 USC 874) and related Department of Labor 

regulations (29 CFR Part 3).

8. All contracts for supplies or construction materials must require compliance with 

the Buy American Act (41 USC Chapter 83). 

9. All contracts, subcontracts, and subgrants over $100,000 must require compliance 

with all applicable standards and requirements issued under section 306 of the 

Clean Air Act (42 USC 1857(h)), section 508 of the Clean Water Act (33 USC 

1368), E.O. 11738, and Environmental Protection Agency regulations (40 CFR 

Part 15).

B. We may also require provisions on changes, remedies, changed conditions, record 

retention and access, suspension of work, and other clauses approved by the Office of 

Federal Procurement Policy.

2-230-60 Do the Davis-Bacon Act and Contract Work Hours and Safety Standards Act 

apply to contracts supported with OSMRE funds?

A. While SMCRA does not include a prevailing wage provision or require that you comply 

with the Davis-Bacon Act (40 USC 3141-3148), all contracts made by you under a 

Federal award in excess of $2,000 must include a provision for compliance with the 

Davis-Bacon Act in your contracts.
E-39

B. The Davis-Bacon Act applies when OSMRE deals directly with a private contractor. We 

will include Davis-Bacon provisions when we award contracts directly for Federal 

regulatory or reclamation programs.

C. While SMCRA does not require you to comply with the Contract Work Hours and Safety 

Standards Act (40 USC 327-330), all contracts you award in excess of $100,000 that 

involve the employment of mechanics or laborers must include provision for compliance 

with 40 USC 3702 and 3704. 
E-40

CHAPTER 2-240

FINANCIAL MANAGEMENT SYSTEMS

2-240-00 What does this chapter do?

2-240-10 Where do these policies come from?

2-240-20 How must states account for funds? 

2-240-30 What financial management standards apply to recipients other than states?

2-240-40 Can we review your financial management system?

2-240-50 What is internal control?

2-240-00 What does this chapter do?

This chapter establishes standards for the systems you, the recipient, use to manage and account 

for funds from an assistance agreement awarded by us, the Office of Surface Mining 

Reclamation and Enforcement (OSMRE).

2-240-10 Where do these policies come from?

Requirements for financial management systems for Federal assistance agreements come from 

the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal 

Awards, at 2 CFR 200 Subpart D.

2-240-20 How must states account for funds? 

A. You, a state must expend and account for assistance funds according to the state laws, 

and procedures you use to expend and account for your own funds. 

B. Your accounting and fiscal control procedures must meet the following standards:

1. They must permit you to prepare the reports required by the assistance agreement.

2. They must permit you to trace funds to a level of expenditures adequate to 

establish that the funds were used in compliance with the assistance agreement 

and the Surface Mining Control and Reclamation Act (SMCRA). 

C. You must ensure that your sub grantees and cost-type contractors meet these financial 

management standards.

2-240-30 What financial management standards apply to recipients other than states?

You, a recipient other than a state, must meet the following standards. You must also ensure that 

your subrecipients meet these standards:
E-41

A. You must make accurate, current, and complete disclosure of the financial results of 

program activities in the financial reports required by the assistance agreement.

B. You must maintain records which adequately identify the source, and use of funds for the 

activities supported by assistance funds. These records must contain information about 

awards, authorizations, obligations, unobligated balances, assets, liabilities, outlays, or 

expenditures, income, and subgrants.

C. You must maintain an effective system of controls and accountability for all cash, real 

and personal property, and other assets. You must adequately safeguard all assets and 

property. You must ensure that assets and property are only used for authorized 

purposes. 

D. You must compare actual expenditures with budgeted amounts. You must relate 

financial information to performance or productivity data. You should develop unit cost 

data as appropriate; however, we do not normally require unit cost data in your reports.

E. You must follow the applicable Office of Management and Budget (OMB) cost 

principles, our program regulations, and the terms of the assistance agreement when you 

determine whether costs are reasonable, allowable and allocable.

F. You must support accounting records with source documentation such as paid checks, 

bank statements, invoices, payrolls, time and attendance records, contract and subgrant 

award documents, etc.

G. If you receive advance payments, you must follow procedures to minimize the time 

between when you receive funds from the U.S. Treasury and when you pay them out.

H. You must have written procedures for your accounting system and operations.

2-240-40 Can we review your financial management system?

Yes, we may review the adequacy of your financial management system as part of a pre-award 

review or at any time after the award.

2-240-50 What is internal control?

A. Internal control is an integral component of an organization’s management. It provides 

reasonable assurance that the following objectives are being achieved:

1. Operations are effective and efficient. Programs meet their missions, goals and 

objectives.

2. Financial reporting is reliable. 
E-42

3. The organization is in compliance with applicable laws and regulations.

B. The Government Accountability Office (GAO) has established the following standards 

for internal control (GAO/AIMD-00-21.3.1 11/99). Although these standards were 

developed for the Federal government, they may also be helpful for your organization.

1. Management and employees should establish and maintain an environment 

throughout the organization that sets a positive and supportive attitude toward 

internal control and conscientious management.

2. Internal control should provide for an assessment of the risks the organization 

faces from both external and internal sources.

3. Internal control activities help ensure that management’s directives are carried 

out. The control activities should be effective and efficient in accomplishing the 

agency’s control objectives. Common internal control activities include the 

following:

a. Top level reviews of actual performance.

b. Reviews by management at the functional or activity level.

c. Management of human capital.

d. Controls over information processing.

e. Physical control over vulnerable assets.

f. Establishment and review of performance measures and indicators.

g. Segregation of duties.

h. Proper execution of transactions and events.

i. Accurate and timely recording of transactions and events.

j. Access restrictions to and accountability for resources and records.

k. Appropriate documentation of transactions and internal control.

4. Information should be recorded and communicated to management and others 

within the organization that needs it. It should be in a form, and within a time 

frame that enables people to carry out their internal control, and other 

responsibilities.

5. Internal control monitoring should assess the quality of performance over time. It 

should also ensure that the findings of audits and other reviews are promptly 

resolved.
E-43

CHAPTER 2-250

SUPPORTING DOCUMENTATION AND ACCOUNTING FILES

2-250-00 What is the purpose of this chapter?

2-250-10 What supporting documentation is appropriate for personnel costs and 

consultant services? 

2-250-20 What supporting documentation is appropriate for construction costs?

2-250-30 What supporting documentation is appropriate for property costs?

2-250-40 What supporting documentation is appropriate for travel costs, space costs, and 

other direct costs?

2-250-50 What supporting documentation is appropriate for indirect costs?

2-250-60 What supporting documentation is appropriate for program income?

2-250-00 What is the purpose of this chapter?

This chapter provides guidance on the kinds of documents you should keep in your accounting 

files to support costs charged to an assistance agreement you received from us, the Office of 

Surface Mining Reclamation and Enforcement (OSMRE). 

2-250-10 What supporting documentation is appropriate for personnel costs and 

consultant services? 

A. Personnel compensation includes all salaries, wages and other payments for services. 

They may be paid currently or accrued. The services must be necessary for the program 

and allocable to this assistance agreement. The cost must be reasonable for the services 

provided. Your personnel compensation policies for costs paid with Federal funds must 

be consistent with those for activities paid with other funds.

You should document amounts charged for personnel with payrolls that have been 

recorded and approved in accordance with generally accepted accounting 

practices. Payrolls should be supported by time and attendance records of employees. If 

employees worked on more than one program or project, the personnel costs charged to 

the assistance agreement should be supported by records showing how their time was 

distributed between projects.

B. Fringe benefits are compensation other than salaries and wages. They may be paid 

currently or accrued. They include costs such as payroll taxes, leave, health benefits, and 

retirement. Fringe benefits are allowable to the extent that they are reasonable, and are 

required by law, contract, or policy. If employees work on more than one program or 

project, charge fringe benefit costs to the agreement in the same percentage as the salary 

charged to the agreement. You should document fringe benefits with your established 

personnel compensation policy, and show that you apply it consistently. 

 
E-44

C. Consultant services pay qualified or expert individuals or organizations to provide 

professional and technical services. You should support consultant costs with proposals 

from more than one reputable consultant whenever feasible. Bills for consultant fees 

should provide a clear statement of the services performed and, as appropriate, the time 

worked or the quantity of services provided. You should file a copy of any reports 

produced by consultants.

2-250-20 What supporting documentation is appropriate for construction costs?

A. Construction costs in OSMRE assistance agreements normally relate to projects to 

reclaim abandoned mine sites, or to restore water or other resources damaged by past 

mining. We must approve projects before you begin actual construction by approving 

your grant application, issuing an environmental conclusion for the NEPA process (i.e. 

Record of Decision, Finding of No Significant Impact, or Categorical Exclusion), and by 

issuing an Authorization to Proceed. In addition to actual construction costs, project 

costs may include other costs allocable to a specific reclamation project, such as planning 

and design, construction monitoring and inspection, and administration.

B. For construction and other contracts, you should document your contracting process. 

Your files should include invitations for bids, bids, contracts, construction monitoring 

reports, contractor's invoices, and any other documents needed to trace the history of the 

contract.

C. You should document your compliance with requirements from the Surface Mining 

Control and Reclamation Act (SMCRA), National Environmental Policy Act (NEPA), 

and OSMRE regulations. For example, you should document your determination that a 

site was eligible for funding under Title IV of SMCRA, NEPA requirements have been 

met (refer to the OSMRE NEPA Handbook for details), your check of contractors in the 

Applicant Violator System (AVS), and your entry of sites, and accomplishments in the 

Enhanced Abandoned Mine Land Inventory System (e-AMLIS).

D. For Abandoned Mine Land (AML) program grants, you should keep documentation 

adequate to justify the totals you report for AML project costs, and to trace project costs 

to individual reclamation projects or sites. 

2-250-30 What supporting documentation is appropriate for property costs?

A. Equipment is nonexpendable, tangible personal property having a useful life of more than 

one year and costing $5,000 or more per unit. See Chapter 2-200 for more information 

on equipment, supplies, and other property. You should document equipment costs with 

approval documents, price quotations, purchase orders, requisitions or contracts, 

receiving reports, and vendor invoices.
E-45

B. Supplies include consumable items such as paper and postage, and also items of property 

which don’t meet the criteria for equipment. You should support supplies costs with 

purchase orders, requisitions, receipts, vendor invoices, or other evidence that the 

supplies were paid by, and used for the assistance program.

2-250-40 What supporting documentation is appropriate for travel costs, space costs, and 

other direct costs?

A. Travel costs are expenses of employees traveling on official business, such as 

transportation, lodging, and subsistence. You may charge these costs on an actual cost 

basis, on a per diem or mileage allowance basis, or on a combination of the two, 

according to the travel policies of your organization. Your travel policies should apply 

consistently to activities supported by Federal, and non-Federal funds. You should 

support travel costs with a report by the traveler of expenses incurred and the purpose of 

the travel, and with evidence the costs were properly authorized and approved.

B. Space costs are the costs of acquiring or renting space to use for the assisted project. See 

Chapter 3-140 for more information on leasing, purchasing or constructing space. Space 

costs also include normal maintenance and operation costs required to make space usable 

for program purposes. You should support space rental costs with a signed lease 

agreement showing all the terms of the rental. You should support space use or 

depreciation charges by showing how the charge was calculated, and applied to your 

program. 

C. Other direct costs include such items as repairs, utilities, telephones, internet access, 

publications and printing, subscriptions, and other miscellaneous expenses related to the 

assistance agreement. You should support charges for other direct costs with vendor's 

invoices, receipts, or other evidence that you received, and used the service for the 

purposes of the assisted program.

2-250-50 What supporting documentation is appropriate for indirect costs?

A. Indirect costs are incurred for a common purpose, benefit more than one program, and 

cannot readily be assigned to one program without more work than it is worth. You must 

ensure that you do not charge items as direct costs which are already included in the 

indirect cost pool.

B. You should keep a copy of your cost allocation plan to show the cost elements in the 

indirect pools and explain the direct cost base, and the cost allocation rationale.

C. You should keep a copy of the approved indirect cost agreement in your assistance 

agreement file. If you have charged costs to an OSMRE assistance agreement based on 

more than one approved indirect cost agreement, you should keep all applicable 

agreements. 
E-46

2-250-60 What supporting documentation is appropriate for program income?

Program income is all funds you receive directly generated by an assistance-supported activity, 

or earned as a result of the assistance agreement during the performance period. See Chapter 2-

210 for more information about program income. You should support program income with 

documents showing all funds you receive, the sources of all program income, and how all 

program income was used.

2-250-70 What supporting documentation is appropriate for costs transferred from one 

funding source to another?

A. Audit reports have cited instances where costs were transferred from other projects, or 

programs to OSMRE assistance agreements many months after the costs were originally 

recorded. In some cases, the documentation did not adequately explain why the transfers 

were made. We recognize that cost transfers may be appropriate when you support 

closely related work from more than one funding source, or when you need to correct 

bookkeeping or clerical errors in the original charges. However, transfers that are 

frequent, late, or not adequately explained particularly if the projects have significant cost 

overruns, or unexpended fund balances, raise serious concerns. They may lead us to 

question the propriety of the transfers, and the overall reliability of your accounting 

system, and internal controls.

B. When closely related work is paid from more than one funding source, you may transfer 

costs from the original funding source to OSMRE funds if the transfer meets all of the 

following conditions.

1. The cost is a proper and allowable charge to the OSMRE agreement.

2. You document the transfer with a full explanation and justification. 

3. A responsible program official and a financial or administrative official certify 

that the transfer is appropriate.

4. To the maximum extent possible, you should transfer costs within 120 days of the 

original charge. Transfers made long after the original charge raise serious 

questions concerning the propriety of the transfer. If you transfer costs more than 

120 days after the original charge, your supporting documentation should also 

explain why the transfer was late.

C. When you transfer costs to OSMRE assistance agreements to correct accounting errors, 

you must make the transfer promptly after you discover the error. You should make 

every effort to correct errors before you submit a financial report to OSMRE. You 

should support the correcting transfer with a full explanation of how the error occurred, 
E-47

and why the new charge is correct. An explanation which merely states that the transfer 

was made "to correct error" or "to transfer to correct project" is not sufficient.

D. Frequent errors or changes in recording costs may indicate the need for improvements in 

your accounting system and/or internal controls. You should evaluate the need for 

improvements in these areas and make them. We may require you to make 

improvements if we determine that they are necessary to reduce errors or improve 

management of Federal funds.
E-48

CHAPTER 2-260

RECORDS RETENTION AND ACCESS 

2-260-00 What does this chapter do?

2-260-05 Where do these requirements come from?

2-260-10 What records are subject to these requirements?

2-260-20 How long must you keep these records?

2-260-30 Can the Federal government access your records?

2-260-40 Does the Freedom of Information Act apply to your records? 

2-260-00 What does this chapter do?

This chapter requires you, the recipient of any assistance agreement from the Office of Surface 

Mining Reclamation and Enforcement (OSMRE), to retain records related to the assistance 

agreement. It also requires you to allow us to access your records. 

2-260-05 Where do these requirements come from?

These requirements are established by the Uniform Administrative Requirements, Cost 

Principles, and Audit Requirements for Federal Awards, at 2 CFR 200, Subpart D.

2-260-10 What records are subject to these requirements?

A. These requirements apply to all financial and programmatic records, supporting 

documents, statistical records and other records, in hard copy or electronic formats, 

pertaining to your assistance agreement.

B. You may substitute electronic, microfilmed, photocopied, scanned or other copied 

records for the original records.

2-260-20 How long must you keep these records?

A. You must keep these records for three years starting on the day you send us your final 

expenditure report to close the assistance agreement, except as noted below. 

B. If any litigation, claim, negotiation, audit or other action involving the records is started 

before the end of the three-year period, you must retain the records until this action is 

completed and all issues arising from it are resolved, or until the end of the regular threeyear period, whichever is later.

C. The three-year retention period for records relating to real property and equipment 

acquired through an assistance agreement starts from the date of the disposition, 

replacement or transfer of the property.
E-49

D. You must require contractors, subcontractors, and subrecipients to retain pertinent 

records for three years after you make your final payment to them, and all other pending 

matters are closed.

E. For an Abandoned Mine Land (AML) grant, the three year retention period starts on the 

date of the final expenditure report for the whole grant regardless of the closeout date for 

individual subaccounts. Normally, we close a one-year subaccount such as 

administrative costs after the first year of the three-year grant. However, you cannot 

dispose of the records of such subaccounts earlier than the rest of the records for that 

grant. You must keep records of all of the subaccounts in your grant for the full three 

year record retention period of the grant. 

2-260-30 Can the Federal government access your records?

Yes. OSMRE and the Comptroller General of the United States, or any of its authorized 

representatives, have the right to access any books, documents, papers or other records kept by 

you and your subrecipients which are pertinent to our assistance agreement. We may audit or 

examine records, or make excerpts or transcripts. Our right of access is not limited to the threeyear retention period, but will last as long as you keep the records.

2-260-40 Does the Freedom of Information Act apply to your records? 

The Freedom of Information Act (5 U.S.C. 552) does not apply to your assistance agreement 

records. It also does not apply to records maintained by your subrecipients. You are not 

required to permit public access to your records by the Freedom of Information Act. However, 

other Federal, state or local laws may require you to provide some type of public access to your 

records.
E-50

CHAPTER 2-270

ENFORCING AND TERMINATING ASSISTANCE AGREEMENTS 

2-270-00 What does this chapter do?

2-270-10 Where do these policies come from?

2-270-20 What enforcement actions may we take if you do not meet the requirements of 

the assistance agreement? 

2-270-30 What process must we follow before we take any enforcement actions to reduce, 

suspend or terminate an assistance agreement?

2-270-40 What specific steps must we take to stop payments?

2-270-50 What specific steps must we take to suspend an assistance agreement?

2-270-60 What specific steps must we take to terminate an assistance agreement for cause?

2-270-70 How can you or we agree to terminate an assistance agreement for convenience?

2-270-00 What does this chapter do?

This chapter explains the policies and procedures we may take if you materially fail to comply 

with any condition of an assistance award you received from us, the Office of Surface Mining 

Reclamation and Enforcement (OSMRE). It also explains how we may agree to terminate an 

agreement for our mutual convenience.

2-270-10 Where do these policies come from?

These policies are found in the Uniform Administrative Requirements, Cost Principles, and Audit 

Requirements for Federal Awards, at 2 CFR 200 Subpart D.

2-270-20 What enforcement actions may we take if you do not meet the requirements of 

the assistance agreement? 

A. We may determine that you are in noncompliance if you or your sub recipient materially 

fails to comply with any terms of assistance agreement. This may be because of a 

Federal law or regulation, a commitment or assurance in your application or approved 

plan, a condition in the award, or any other requirement. 

B. If you are in noncompliance, and do not appear to be taking steps to resolve the problem, 

we may take one or more of the following actions as we consider appropriate:

1. Temporarily stop cash payments until you correct the problem or take more 

severe enforcement action. Alternatively, we may review each drawdown request 

you make and decide whether to approve it for payment.

2. Disallow both the Federal and non-Federal expenditures for all or part of the cost 

of the activity that is not in compliance. When we disallow a cost, you cannot 
E-51

spend Federal funds for that cost, and if you spend non-Federal funds for it you 

cannot claim them as match.

3. Wholly or partly suspend the current award. Suspension means that we 

temporarily stop your authority to obligate additional OSMRE funds under this 

assistance agreement. We will suspend the assistance agreement until you correct 

the deficiency or we decide to terminate the agreement. 

4. Wholly or partly terminate the current award. Termination means that this 

assistance agreement ends immediately.

5. Do not approve any future assistance awards for the program.

6. Take other remedies that may be legally available.

C. In addition to these remedies, we may also consider debarment, which prohibits an entity 

or a person from receiving any Federal financial assistance. See Chapter 2-110 for more 

information on debarment and suspension.

2-270-30 What process must we follow before we take any enforcement actions to reduce, 

suspend or terminate an assistance agreement?

A. When we identify deficiencies, we must work with you to resolve the issue. If we cannot 

resolve the deficiency, our office which awarded the assistance agreement must propose 

an enforcement action to the appropriate Regional Director (RD) and obtain his 

concurrence. The region must also coordinate proposed enforcement actions with our 

Assistant Director, Program Support (AD-PS) and Division of Financial Management 

(DFM).

B. The awarding office must send you written notice of the proposed action by certified 

mail. The notice must inform you that reduction, suspension or termination of the grant 

agreement will begin no earlier than 30 days after the date of the notice if you do not take 

remedial action within that period.

C. The awarding office must give you opportunity to consult with OSMRE during the 30-

day notice period.

D. If you do not take any remedial action, or appeal the decision, within the 30-day notice 

period, the awarding office will take action to reduce, suspend or terminate the assistance 

agreement.

E. You may appeal the decision of the RD to the Director of OSMRE in writing. You must 

explain the reasons why you are requesting review. We must receive your appeal within 

30 days of the written notice.
E-52

F. You may appeal the Director's decision to the Department of the Interior’s Office of 

Hearings and Appeals in writing, outlining the reasons for requesting review. You must 

file this appeal within 30 days of the Director's decision.

2-270-40 What specific steps must we take to stop payments?

A. The awarding office must coordinate with DFM when it first considers stopping 

payments on an assistance agreement, and throughout the process of deciding, and 

carrying out the suspension.

B. The awarding office must inform you that we have decided to withhold payments on your 

assistance agreement. We must tell you the date when we plan to stop payments. 

C. DFM will work with Treasury to stop payments.

D. When the issue has been resolved or the deficiency corrected, we will pay out all funds 

that we withheld during the period of the suspension.

2-270-50 What specific steps must we take to suspend an assistance agreement?

A. We will suspend any pending actions as of the effective date of the suspension. We will 

disallow any costs obligated or incurred. 

B. We will allow those costs which you properly incurred before the effective date of the 

suspension. They must have been necessary for the immediate needs of the program. 

They cannot have been incurred in anticipation of the suspension.

C. We will require that you refund any unobligated Federal assistance funds you may have 

on hand. 

D. The suspension will remain in effect until you correct the deficiency, or we take further 

enforcement action.

2-270-60 What specific steps must we take to terminate an assistance agreement for cause?

A. We may terminate an assistance agreement for cause in any of the following 

circumstances. We may terminate the whole agreement in its entirety or in part: 

1. We may terminate an agreement if you have materially failed to comply with the 

terms and conditions of the agreement and resolution does not seem probable.
E-53

2. We may terminate all or part of your regulatory grant if approval of all or part of 

your regulatory program is withdrawn, or if we take over all or part of your 

regulatory program.

3. We may terminate your Abandoned Mine Land (AML) grant if approval of your 

reclamation or regulatory program is withdrawn.

B. Costs incurred after termination of an award are not allowable except as follows:

1. Costs which we specifically authorize are allowable. 

2. Other costs after termination are allowable if they result from obligations which 

you properly incurred before the effective date of the termination, and were not 

able to cancel. The obligations cannot have been in anticipation of the 

termination.

C. You must return any unobligated funds to us.

2-270-70 How can you or we agree to terminate an assistance agreement for convenience?

A. You may terminate an assistance agreement for convenience by sending a written notice 

to OSMRE. Your notice must state the effective date and explain the reasons for the 

termination. If you are only terminating part of the agreement, you must identify the part 

to be terminated. If you propose a partial termination, and we determine that the 

remaining part of the award will not accomplish its purpose, we may terminate the entire 

award.

B. We may terminate an assistance agreement with your consent if we agree that continuing 

the project or program would not produce benefits worth the additional costs. We may 

terminate the entire agreement or a part of it. We must agree upon the termination 

conditions, including the effective date. For a partial termination, we must also agree on 

the part of the agreement to be terminated.

C. We will process a termination for convenience as an amendment to the assistance 

agreement. The amendment must be approved by the authorized official in our awarding 

office.

D. You must not incur costs after termination of an assistance agreement. Such costs are not 

allowable unless we approve them, or you properly incur the obligation before the 

termination date.

E. After termination, we must pay you for the Federal share of valid obligations. You must 

return any unobligated funds to us.
F-1

Annex F: FAM Part 3 - Allowable Costs

 

CHAPTER 3-100

COST PRINCIPLES

3-100-00 What does this chapter do?

3-100-10 Where do these principles come from?

3-100-20 What costs are allowable?

3-100-30 What costs require OSMRE approval?

3-100-40 What costs are unallowable?

3-100-00 What does this chapter do?

This chapter explains the basic principles of allowable cost for all assistance agreements awarded 

by us, the Office of Surface Mining Reclamation and Enforcement (OSMRE). 

3-100-10 Where do these principles come from?

A. The Office of Management and Budget (OMB) has established principles for determining 

allowable costs for Federal assistance agreements. They publish the cost principles in 

three circulars according to the type of recipient organization. You can find more 

information about allowable costs in the Code of Federal Regulations (CFR) entitled 

Uniform Administrative Requirements, Cost Principles, and Audit Requirements for 

Federal Awards at 2 CFR Part 200.

B. We include the appropriate cost principles by reference in each assistance agreement that 

we award. These cost principles apply to your activities as a recipient, and to any 

subrecipients or cost-type contractors who receive funds under your assistance 

agreement. You must cite the appropriate principles in the subgrant or contract award.

3-100-20 What costs are allowable?

A. You must follow the applicable OMB circular listed above. 

B. Costs we approve in your assistance agreement are allowable.

C. Generally, costs are allowable if they meet all of the following standards.

1. The costs must be necessary and reasonable for the proper and efficient execution 

of the project.

2. The costs must be in accordance with the assistance agreement and the most 

recent approved project budget.
F-2

3. The costs must not be prohibited by Federal, state, or local statutes or regulations.

4. The costs must be applied consistently with your accounting procedures.

5. The costs must not be included as part of any other Federally financed program.

6. The costs must be net costs after deducting all applicable credits.

7. The costs must comply with any budgetary or other types of restrictions on 

expenses we have established.

8. The costs must be incurred and the work performed within the dates of the 

performance period. Pre-agreement or proposal costs may be allowable, but only 

if the assistance agreement specifically provides for them.

9. The costs must be fully documented. 

3-100-30 What costs require OSMRE approval?

A. The OMB cost circulars show that some costs, including equipment, are only allowable 

with our prior approval. If you included these costs in your application budget, our 

approval of your assistance agreement or amendment constitutes our approval of the 

costs. If these costs are not in your approved budget, you must request our approval 

before you incur the costs.

B. When you treat these costs as indirect costs (or, in the case of a state government, include 

them in a statewide cost allocation plan), we will consider that approval of your indirect 

cost rate or cost allocation plan by the cognizant Federal agency constitutes our approval 

of the costs. You do not have to request our specific approval.

3-100-40 What costs are unallowable?

A. You must apply the standards of the applicable OMB cost principles to determine 

whether a cost is unallowable. However, you must consider the specific circumstances in 

each case when you apply the cost principles.

B. The following list provides some examples of unallowable costs. 

1. Costs related to losses from uncollectible accounts, other claims, or any related 

costs. 

2. Costs related to payments to a contingency reserve or any similar provision for 

unforeseen events.
F-3

3. Costs related to contributions and donations. 

4. Costs of amusements, social activities, and related incidental costs. 

5. Costs resulting from violation of, or failure to comply with, Federal, state and 

local laws and regulations, including fines, penalties, damages, attorney fees and 

litigation costs, and other settlements. These costs are also unallowable if they 

result from failure to comply with the terms of your assistance agreement or 

approved program.

6. Cost of general state or local government, including the following costs.

a. Salaries and expenses of the office of the governor of a state or the chief 

executive of a political subdivision.

b. Salaries and other expenses of the state legislature or similar local 

governmental bodies such as county supervisors, city councils, or school 

boards, whether incurred for purposes of legislation or executive direction

7. Costs related to interest on borrowed capital (however represented), bond 

discounts, cost of financing and refinancing operations, and related legal and 

professional fees, unless Federal legislation authorizes them.

8. Costs of certain influencing activities associated with obtaining a grant.

9. Costs of one assistance agreement that exceeded the total Federal funding 

available under that agreement cannot be charged to other assistance agreements.

10. Costs for individual memberships, such as bar association and professional 

engineering society dues and license fees are unallowable. However, costs for 

agency membership in civic, business, technical and professional organizations 

may be allowable if they are necessary for the assisted activity. 
F-4

CHAPTER 3-110

INDIRECT COST RATES

3-110-00 What does this chapter do?

3-110-10 Where do these principles come from?

3-110-20 What are indirect costs?

3-110-30 How do you establish an indirect cost rate? 

3-110-40 How will we document your approved indirect cost rate? 

3-110-00 What does this chapter do?

This chapter explains the basic principles of indirect costs for all assistance agreements awarded 

by us, the Office of Surface Mining Reclamation and Enforcement (OSMRE). These principles 

also apply to subgrants and cost-type contracts that you award under OSMRE assistance 

agreements. 

3-110-10 Where do these principles come from?

The Office of Management and Budget (OMB) has established principles for determining 

allowable costs for all OSMRE assistance agreements. These principles cover indirect as well as 

direct costs. You can find this in the Uniform Administrative Requirements, Cost Principles, and 

Audit Requirements for Federal Awards 2 CFR Part 200.

3-110-20 What are indirect costs?

A. Indirect costs are common or joint-purpose costs that benefit more than one office, 

agency, or program. Rather than incur excessive costs to trace these expenses to the 

specific program they benefit, you will normally charge indirect costs to Federal 

assistance agreements by prorating them based on an indirect cost rate. Some examples 

of functions which organizations may choose to treat as indirect costs are accounting, 

facility maintenance, and human services. 

B. You should provide for the full reimbursement of your organization’s indirect costs under 

an approved indirect cost rate.

3-110-30 How do you establish an indirect cost rate? 

A. Your indirect cost rate for all Federal assistance is reviewed, negotiated and approved by 

your cognizant Federal agency. Your cognizant agency as assigned by OMB is generally 

the Federal agency with the largest amount of funding for your organization. 

B. If you do not have an approved indirect cost rate, you must submit an initial indirect cost 

proposal to your Federal cognizant agency except as provided in subsection 200.414 of 2 

CFR.
F-5

C. You should base your cost proposal on your organization's actual costs for your most 

recently completed fiscal year. However, if you are aware of factors that may result in a 

significant change during the agreement period, you should base your proposal on 

projected costs for that fiscal year. 

D. Requirements for development and submission of indirect cost rate proposals are 

contained in the applicable OMB cost principles listed above.

3-110-40 How will we document your approved indirect cost rate? 

A. You must include a copy of your current indirect cost agreement approved by the 

cognizant Federal agency with your assistance application. 

B. If your cognizant Federal agency delays approval of your agreement, you may 

alternatively include in your application, a copy of the timely indirect cost rate 

application that you sent to your cognizant agency. 

C. You should be familiar with your organization’s indirect cost agreement and what costs 

are included in it. You must ensure that you do not charge expenses as direct costs which 

are already being charged to the assistance agreement as indirect costs. We may review 

your actual costs to ensure that they are being charged appropriately in accordance with 

your indirect cost agreement.

D. We will maintain a copy of your indirect cost agreement in our official assistance 

agreement file to support our award.
F-6

CHAPTER 3-120

SUBGRANTS AND TRANSFERRING WORK

3-120-00 What does this chapter do?

3-120-10 Where do these policies come from?

3-120-20 Must you get prior OSMRE approval for subgrants or transfers? 

3-120-30 What are our requirements for approving subgrants or transfers?

3-120-40 What must you do when you award subgrants?

3-120-00 What does this chapter do?

This chapter explains our requirements about using a subgrant or contract to transfer financial 

assistance or the actual performance of work under our assistance agreements to a third party. 

This chapter also explains our policy on approving a request to subgrant or transfer work or 

financial assistance to third parties. It also explains the basic principles of awarding and 

administering subgrants. This information applies to all assistance agreements awarded by us, 

the Office of Surface Mining Reclamation and Enforcement (OSMRE).

3-120-10 Where do these policies come from?

These policies are found in the Federal Grant and Cooperative Agreement Act of 1977 (P.L. 95-

224) and the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for 

Federal Awards, at 2 CFR 200, Subpart D.

3-120-20 Must you get prior OSMRE approval for subgrants or transfers? 

A. Yes, you must obtain our approval before you transfer the actual performance of 

substantive programmatic work to a third party by a contract or other means. You must 

also obtain our approval before you provide financial assistance to a third party by a 

subgrant or other means.

B. If you did not include the transfer in your approved application, you must request our 

approval through a formal amendment to the current award.

C. Subrecipients must obtain your approval before they award any subgrants or contracts 

transferring work.

3-120-30 What are our requirements for approving subgrants or transfers?

A. You must perform a substantive role in carrying out project or program activities under 

an assistance agreement we award to you. We may authorize you to transfer substantive 

programmatic work, or to award financial assistance only if you will continue to perform 

at least one of the following roles:
F-7

1. Principal performer of project activities.

2. Primary beneficiary of Federal financial assistance.

3. Overall administrator of a program in which third parties perform activities or 

receive financial assistance.

B. Generally, we must review the specific circumstances of each application or request 

involving the transfer of work or the award of financial assistance to determine whether 

approval would violate the rule in the previous paragraph. However, if the proposed 

transfer falls into one of the following classes, we may assume that approval would not 

violate the rule:

1. You may contract for construction services under an assistance agreement for 

construction. Construction includes alteration, or renovation of real property.

2. You may subgrant or contract for projects if we awarded your assistance 

agreement under a statute or regulation explicitly intending that your primary 

responsibility is to select projects, and to award, and administer grants, contracts 

or cooperative agreements.

3. You may transfer activities and funds to a collaborating or cooperating 

organization if we awarded your assistance agreement under a statute or 

regulation explicitly intending such collaboration or cooperation.

4. You may transfer activities and funds to a college, university, hospital, or 

government entity if you are a closely affiliated but separately incorporated 

organization whose primary purpose is to receive and administer gifts, grants, 

cooperative agreements and contracts. An example is the transfer of funds to a 

state university from its affiliated research foundation.

C. We may limit the kinds of third parties eligible to perform the work, or receive financial 

assistance under your assistance agreement. However, we will not choose a specific 

entity and directly or indirectly require you to transfer the work, or award the assistance 

to that entity. You must choose your subrecipient or contractor.

D. We will not require you to submit the contract or subgrant documents for our prior 

approval.

3-120-40 What must you do when you award subgrants?

A. If you are a state, then you must follow state law and procedures when you award and 

administer subgrants or financial assistance to local and Indian tribal governments. 
F-8

1. You must also ensure that every subgrant includes any clauses required by 

Federal statute and executive orders and their implementing regulations.

2. You must also ensure that subgrantees are aware of requirements imposed upon 

them by Federal statute and regulation.

3. You must also ensure that a provision for compliance with the record retention 

and access requirements is included in every subgrant.

4. You must also apply substantially the same standards of timing and amount for 

our cash advances to you to any advances of assistance funds you make to 

subgrantees.

5. You must report your subawards on the Federal Funding Accountability and 

Transparency Act Subaward Reporting System (FSRS).

B. All recipients other than states will follow the applicable provisions of the Grants 

Common Rule for awarding and administering subgrants, whether on a cost 

reimbursement or fixed amount basis. 

1 You must ensure that every subgrant includes a provision for compliance with 

applicable provisions of the 2 CFR Part 200 Subpart D.

2. You must ensure that every subgrant includes any clauses required by Federal 

statute, and executive orders, and their implementing regulations

3. You must ensure that subgrantees are aware of requirements imposed upon them 

by Federal statutes and regulations.
F-9

CHAPTER 3-130

LEASED FACILITIES OR EQUIPMENT

3-130-00 What does this chapter do?

3-130-10 Where do these policies come from?

3-130-20 When can you lease facilities or equipment?

3-130-30 What types of leases can you use? 

3-130-00 What does this chapter do?

This chapter explains how to charge the costs of leased facilities and equipment to any assistance 

agreement awarded by us, the Office of Surface Mining Reclamation and Enforcement 

(OSMRE).

3-130-10 Where do these policies come from?

The Office of Management and Budget (OMB) has established principles for determining 

allowable costs for Federal assistance agreements. We include the appropriate cost principles by 

reference as conditions for each assistance agreement we award. You can find this in the 

Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal 

Awards, at 2 CFR Part 200.

3-130-20 When can you lease facilities or equipment?

Generally, you own your facilities and equipment and charge the costs of them to your assistance 

agreement through depreciation or use charges. However, in some cases leasing facilities or 

equipment is necessary or more economical. In the following examples, leasing may be 

appropriate, and allowable depending on the specific circumstances:

A. Leasing will reduce expenses charged to the assistance agreement for direct or indirect 

costs.

B. Your project has a short duration. No owned space or equipment is available.

C. You cannot meet specific program objectives or requirements with facilities you own.

D. You cannot efficiently accommodate an increase in workload volume by modifying or 

augmenting facilities you own.

3-130-30 What types of leases can you use? 

You can use the following types of leases:
F-10

A. In a short-term lease, the cumulative term is two years or less for the use of the 

equipment, or five years, or less for occupancy of the facilities.

B. In a long-term lease, the cumulative term of the use or occupancy is two years, or more 

for equipment, and five years or more for facilities. If you lease equipment or facilities as 

a short-term lease but then extend past the two or five year threshold, then the lease 

would become a long term. In this case, you would treat the lease as short-term until 

after the two or five-year point is reached.

C. In a sale and leaseback arrangement, your organization sells the property you own, and 

then leases it back from the purchasing organization.

D. In a less-than-arms-length lease, one party to the lease agreement is able to control, or 

substantially influences the actions of the other. The following are examples of such 

leases: 

1. Agreements between divisions of an organization. 

2. Agreements between organizations under common control through common 

officers, directors, or members.

3. Agreements between an organization and a director, trustee, officer or key 

employee of the organization or his immediate family. This may also be through 

corporations, trusts or similar arrangements in which they hold a controlling 

interest.
F-11

CHAPTER 3-140

PURCHASING, CONSTRUCTING AND RENOVATING BUILDINGS

3-140-00 What does this chapter do?

3-140-10 Where does this information come from?

3-140-20 What costs are allowable for purchasing or constructing a building?

3-140-30 When can you use the Capital Expenditure method?

3-140-40 When will you use the Depreciation or Use Allowance method?

3-140-50 Can you charge costs to alter or renovate a building?

3-140-00 What does this chapter do?

This chapter explains how to charge the costs of a building or facility you purchase or construct 

to your assistance agreement from us, the Office of Surface Mining Reclamation and 

Enforcement (OSMRE). This chapter also explains our requirements for costs to alter or 

renovate an existing building or facility.

3-140-10 Where does this information come from?

The Office of Management and Budget (OMB) has established principles for determining 

allowable costs for Federal assistance agreements. You can find this in the Uniform 

Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, at 2 

CFR Part 200.

3-140-20 What costs are allowable for purchasing or constructing a building?

OMB provides two methods for determining the allowable costs for a building. 

A. Under the Capital Expenditure method, you may charge the entire cost of the building to 

the assistance agreement at the time you buy or build it. We must specifically approve 

the expenditure in advance. Capital expenditure costs are treated as direct costs.

B. Under the Depreciation or Use Allowance method, you may charge the costs of the 

building to assistance agreements over time through depreciation or use allowances. You 

charge a portion of the cost to the program each year over the useful life of the building. 

Depreciation or use allowance charges are often treated as indirect costs.

3-140-30 When can you use the Capital Expenditure method?

You may request our approval to charge the entire cost of a building you are purchasing or 

constructing as a capital expenditure. We may approve your request if we determine that it is 

justified. You must meet all of the following conditions.

A. Existing law does not prohibit the charge.
F-12

B. You will use the building exclusively in the performance of an OSMRE supported 

program, or for Federally supported programs including an OSMRE supported program. 

You expect to need this facility for this purpose long-term.

C. You must acquire the building to accomplish the objectives of your OSMRE program. A 

general-purpose building will not meet this condition if the new space is needed because 

of the expansion of programs supported by non-Federal funds, or because of the 

expansion of Federally supported programs in facilities also used by non-Federal 

programs.

D. You cannot already own the facility. However, this requirement does not apply to land 

you own, if you purchased the land expecting to build a facility meeting the requirements 

of this section.

E. If you will have more than one Federal program in the facility, all Federal agencies 

responsible for administering the programs must approve your use of the Capital 

Expenditure method.

F. If you charge the full cost under the Capital Expenditure method, we may require you to 

establish a special indirect cost rate for the programs you conduct in the facility. If you 

do not establish a special rate, we must notify the appropriate Federal cognizant agency 

before we use the approved indirect cost rate.

G. If you sell the facility or use it for purposes we do not authorize, you will be accountable 

to the Federal government for the Federal interest in the facility. See the applicable OMB 

cost circular for more information.

3-140-40 When will you use the Depreciation or Use Allowance method?

If you do not use the Capital Expenditure method to purchase or construct a facility, then you 

will use the Depreciation method or Use Allowance method. You must use the original 

acquisition cost of the facility as the base for either method. If you calculate a depreciation 

charge, use the useful life of the facility. You should normally calculate depreciation on a 

straight-line basis. Under the Use Allowance method, your annual charge may not exceed 2% of 

the acquisition cost of the building. See the applicable OMB cost circular for more information 

on depreciation or use allowance charges.

3-140-50 Can you charge costs to alter or renovate a building?

A. You may request our prior approval to charge renovation costs to your assistance 

agreement. The renovations may change the building's interior layout, environment, or 

utilities. These costs are normally charged to individual assistance agreements as a 

separate category of direct costs. 
F-13

B. Your request must justify the need to alter or renovate the building to support your 

program. At a minimum, your request to charge renovation costs to your assistance 

agreement should include the following information.

1. Provide a cost analysis that compares the proposed alteration or renovation with 

other options, such as leasing, construction, or purchasing. The level of detail 

required for the cost analysis will depend on the proposed cost of the project, and 

the specific circumstances of your request. 

2. Demonstrate that the building has an appropriate life expectancy and is suitable 

for the conversion project you propose. 

3. Explain why the building renovation is essential to your program.

4. Confirm that you will occupy the renovated space.
G-1

Annex G: FAM Part 4 - Abandoned Mine Lands (AML) Grant Program

CHAPTER 4-100

AML ACTIVITIES FOR UNCERTIFIED PROGRAMS

4-100-00 What does this chapter do?

4-100-10 Where does this information come from?

4-100-20 What types of AML funds and subaccounts are available to you and how can you 

use them? 

4-100-30 What lands and waters are eligible for reclamation with AML funds? 

4-100-40 How should you determine and document site eligibility?

4-100-50 Can you spend AML funds on a site which is not eligible?

4-100-60 What are the priorities for coal reclamation?

4-100-70 What water supply restoration work is eligible for AML funding?

4-100-80 What non-coal reclamation work is eligible for AML funding?

4-100-90 What are examples of reclamation expenses eligible for AML funding? 

4-100-100 What special rules apply to an AML project funded by coal extraction?

4-100-110 What happens to AML funds that you don’t use?

4-100-00 What does this chapter do?

This chapter discusses Abandoned Mine Land (AML) grants to uncertified states and tribes 

awarded by us, the Office of Surface Mining Reclamation and Enforcement (OSMRE). Your 

program is uncertified if your state or tribe has not certified that all the coal priorities on eligible 

lands and waters within your borders or jurisdiction are completed. If you have certified 

completion of these priorities, this chapter does not apply to you, and you should use Chapter 4-

300 instead.

4-100-10 Where does this information come from?

Title IV of the Surface Mining Control and Reclamation Act (SMCRA), P.L. 95-87, as amended, 

established the AML program. It also established the AML Fund, supported by reclamation fees 

paid by current coal mining operations. It authorizes OSMRE to use funds from the AML Fund 

and Treasury to provide financial assistance to states and tribes to carry out their approved 

reclamation plans. Rules governing this program are found in our regulations at 30 CFR, Parts 

870 through 887. In 2006, amendments to SMCRA substantively changed the AML program 

(see Federal Register Vol. 73, No. 221, November 14, 2008). 

4-100-20 What types of AML funds and subaccounts are available to you and how can you 

use them? 

Please refer to Chapter 4-500 for a full listing of available AML subaccounts and fund types.

4-100-30 What lands and waters are eligible for reclamation with AML funds? 
G-2

A. Lands and waters are eligible for reclamation with AML funds if they meet all of the 

following conditions.

1. They were mined for coal or affected by coal mining or processing.

2. They were mined prior to August 3, 1977, and left in an unreclaimed or 

inadequately reclaimed state.

3. There is no continuing responsibility for reclamation by the operator or any other 

party under state or Federal laws.

B. Other lands and waters may be eligible in the following circumstances. In each of these 

cases, the site must be a Priority 1 or 2, or an emergency. 

1. Lands and waters are also eligible if they were mined between August 3, 1977 

and the date on which the Secretary approved your state’s regulatory program.

2. Lands and waters that were mined and abandoned between August 3, 1977 and 

November 5, 1990, that the surety of the mining operator became insolvent during 

this period, and that, as of November 5, 1990, funds immediately available from 

proceedings relating to the insolvency, or from any financial guarantee, or other 

source are not sufficient to provide for adequate reclamation, or abatement at the 

site.

3. Federal lands managed by the U.S. Forest Service are only eligible if they were 

mined and abandoned before August 28, 1974. Federal lands managed by the 

Bureau of Land Management are eligible if they were mined, and abandoned 

before November 26, 1980.

C. Lands are also eligible if they were mined or processed for minerals other than coal and 

abandoned before August 3, 1977, if there is no continuing reclamation responsibility 

under state or other Federal laws. They must meet the requirements of section 409.

D. Bond forfeiture sites are considered eligible if the amount forfeited, and any other funds 

or form of financial guarantee is not enough to pay the total cost of reclamation. If the 

bond funds and other designated funding for forfeited sites are not adequate to reclaim 

the site, you may expend AML funds to complete reclamation. Any money available 

from other sources, or ultimately recovered from responsible parties must be used to 

cover the cost of reclamation, or transferred to the appropriate AML account.

E. If a site which otherwise meets the eligibility criteria in SMCRA was re-affected by 

mining after August 3, 1977, the site will remain eligible for AML funding despite the 

post-SMCRA mining if the following conditions are met.
G-3

1. The post-SMCRA mining did not substantially increase or alter the safety issues 

or environmental damage presented by the pre-SMCRA mining.

2. The total costs of the reclamation activities are not increased by the post-SMCRA 

mining.

3. There is no known responsible party or, if the responsible party is known, 

available funds are insufficient to pay the total cost of reclamation. 

If these conditions are not met, only parts of the site not affected by the post-SMCRA 

mining activities will be eligible for AML funding. If this situation occurs, you may alter 

the project to include only the eligible part of the project, or you may use non-AML 

funds to pay for the ineligible part.

F. Multi-use sites, adversely affected by mining prior to August 3, 1977, but subsequently 

used for some non-mining activity, remain eligible for AML funding. However, they are 

eligible only to the extent that mining-related problems still exist, and create a safety or 

environmental issue at the site. When the non-mining activity is the primary cause of the 

problem, the reclamation responsibility may shift away from the AML program.

4-100-40 How should you determine and document site eligibility?

A. You are responsible to make eligibility determinations under your approved AML 

Plan. Eligibility determinations must be signed by your Attorney General's Office or by 

your legal counsel. You must include the eligibility determination in your request for our 

“Authorization to Proceed (ATP)” with reclamation of the project. You must keep 

eligibility determinations in the project files. 

B. OSMRE may review your project files and eligibility determinations as part of our 

oversight. If we determine that you funded an ineligible project, we will take appropriate 

procedures to recover expended funds. 

4-100-50 Can you spend AML funds on a site which is not eligible?

You may need to affect property which is not eligible in order to access an eligible site or 

complete reclamation on an eligible site. You must limit reclamation on these affected sites to 

repairing the damage caused by using them for AML reclamation activities. If reclamation 

activities on ineligible property are needed to repair damages caused by accessing an eligible 

site, you must fully document and justify these activities in the project narrative before you 

request an ATP from us.

4-100-60 What are the priorities for coal reclamation?

Expenditures of State and Tribal Share and Historic Coal Funds for coal reclamation must reflect 

the following priorities in order.
G-4

A. Priority 1 is the protection of public health, safety and property from extreme danger 

from the adverse effects of coal mining practices, including the restoration of adjacent 

land, and water resources, and the environment. We define adjacent as geographically 

contiguous, or touching the Priority 1 site at a boundary or point. 

B. Priority 2 is the protection of public health and safety from the adverse effects of coal

mining practices, including the restoration of adjacent land, and water resources and the 

environment.

C. Priority 3 is the restoration of land and water resources, and the environment previously 

degraded by adverse effects of coal mining practices. You may expend State or Tribal 

Share or Historic Coal Funds for Priority 3 lands and waters if any of the following 

conditions applies.

1. You have completed all the Priority 1 and Priority 2 reclamation within the 

jurisdiction of your state or tribe.

2. The expenditure for Priority 3 reclamation is made in conjunction with the 

expenditure of funds for past, present, or future Priority 1 or Priority 2 

reclamation projects. Also, one of the following conditions must apply.

a. The expenditure must facilitate the Priority 1 or Priority 2 reclamation.

b. The expenditure must provide reasonable savings towards the objective of 

reclaiming all Priority 3 land, and water problems within the jurisdiction 

of your state or tribe.

3. The expenditure for Priority 3 reclamation is being made as part of an 

Appalachian Clean Streams project, a Watershed Cooperative Agreement project, 

a project authorized under the Enhancing AML Rule, or any AML sites reclaimed 

under the re-mining incentives provided under section 415 of SMCRA, as revised 

by the 2006 amendments. 

4-100-70 What water supply restoration work is eligible for AML funding?

A. Section 403(b) of SMCRA allows you to expend funds to protect, repair, replace, 

construct, or enhance facilities related to water supply, including water distribution 

facilities and treatment plants, in order to replace water supplies adversely affected by 

coal mining practices. 

B. You may use State or Tribal Share, Historic Coal Funds, and/or Prior Balance 

Replacement funds for water supply restoration projects.

C. Projects eligible for funding as water supply projects include the following:
G-5

1. Sites impacted by coal mining prior to August 3, 1977.

2. Sites impacted by coal mining during the period beginning on August 3, 1977, 

and ending on or before the date on which the Secretary approved a state program 

pursuant to section 503 of SMCRA.

3. Sites impacted by coal mining during the period beginning on August 3, 1977, 

and ending on or before November 5, 1990, if the surety of the mining operator 

became insolvent during this period.

The adverse effects of coal mining practices need not have occurred entirely within these 

periods as long as the state or tribe determines that they occurred predominantly in these 

periods.

4-100-80 What non-coal reclamation work is eligible for AML funding?

A. You may request funds to reclaim eligible non-coal problems as provided in section 409 

of SMCRA and 30 CFR 875. Non-coal projects must protect public health, safety, and 

property from extreme danger of adverse effects of mining practices. Lands and waters 

which are adjacent to sites with extreme dangers are not eligible for AML funding. 

B. The request must be made by the governor of the state or the governing body of the tribe, 

using the following procedures.

1. The state or tribe must submit a letter request signed by the governor or tribal 

governing body to the appropriate OSMRE office. You must include it in your 

complete grant application, even though the letter may be addressed to the 

Secretary of the Interior or the Director of OSMRE.

2. Since our approval or disapproval of the grant application is our response to your 

request, we will not send a separate letter response.

3. If you are adding a non-coal project to an existing grant, you must send the letter 

request signed by the governor or tribal governing body to our awarding office as 

soon as you identify the need for the project. Your request and our written 

approval will follow the letter approval process for making a scope change 

described in Chapter 4-220. 

C. You may only use State or Tribal Share or Historic Coal Funds for non-coal reclamation.

4-100-90 What are examples of reclamation expenses eligible for AML funding? 
G-6

You may use AML funds for activities which are necessary to reclaim eligible lands. The 

following OSMRE decisions on the use of AML funds for specific types of reclamation activities 

are provided as examples for determining whether an activity is allowable.

A. Repairs to structures. Costs of repairs to structures damaged by subsidence or other 

adverse effects of past mining are generally not eligible. Section 407(h) of SMCRA 

prohibits the use of Title IV funds to pay housing construction costs. AML funds may be 

used to repair structures only if the repairs are a direct and necessary part of the project 

reclamation. For example, foundation reinforcement may be funded only as needed to 

support the foundation during reclamation activities, preventing damage to the structure 

and harm to the workers (see SMCRA Section 412).

B. Asbestos removal from structures. AML funds may not be used to remove asbestos 

insulation from hot water pipes in houses that were originally built by a mining company 

for its employees. Houses built for company employees were not directly connected to 

coal mining or processing, so removing asbestos insulation from the houses is not part of 

AML reclamation.

C. Moving or relocating structures. Subsidence or other hazards may occasionally make it 

necessary to move a structure in order to prevent further damage, or conduct effective 

reclamation at the site. In such situations, you should do the following:

1. Take all necessary steps to prevent the structures from sustaining further 

damage, including shoring up the structure, and restoring the site so as to 

achieve the previous load bearing capacity. Some minimal corrective 

action in the foundation may be appropriate if the damage is not 

attributable to other problems. The objective is to leave the site in as safe 

a condition as possible, given the circumstances.

2. Advise occupants that the structure may be unsafe or borderline, and 

inform local authorities of the conditions. Do not order occupants to 

vacate.

3. Make all reasonable efforts to reclaim the site without moving the 

structure. If there is no other way to reclaim the site, the structure may be 

moved, but only after the OSMRE awarding office approves your written 

justification. You should move structures only as a last resort and only if 

the option is cost-effective.

D. Temporary lodging expenses. Reclamation activities are limited to abating, preventing or 

controlling the primary cause of the hazard. The costs to treat secondary effects of past 

coal mining go beyond the scope of Title IV. Temporary lodging expenses may be 

funded only if the residents must be removed to reclaim the site, and only for a limited 

time. The OSMRE awarding office must approve payment of temporary lodging 

expenses on a case-by-case basis.
G-7

E. Claims for damages resulting from AML reclamation. Where damages occur to adjacent 

property as a result of AML reclamation, or where claims are made for loss of business or 

damages to personal property, or where there are other claims relating to the negligence 

of parties involved in the AML reclamation, you may not settle the claims. You must 

make a summary report of your investigation of the claim and send it to the OSMRE 

office which awarded your grant. Our office must immediately send your report to the 

Department of the Interior, Office of the Solicitor, Division of Mineral Resources, 

Branch of Surface Mining, for definitive advice or action. The solicitor can determine 

whether claims may be covered under the Tort Claims Act, contractor liability insurance, 

subsidence insurance, or other means and could therefore result in litigation.

4-100-100 What special rules apply to an AML project funded by coal extraction?

If a Title IV AML reclamation project will use government financing for less than 50% of the 

total cost because of planned coal extraction, the following rules apply. See our regulations at 30 

CFR 874.17 for more information.

A. You must consult with the Title V regulatory authority to make the following 

determinations.

1. Determine the likelihood of coal being mined on the site under a Title V permit. 

2. Determine the likelihood that nearby mining activities might create new 

environmental problems or adversely affect existing environmental problems at 

the site.

3. Determine the likelihood that reclamation activities at the site might adversely 

affect nearby or adjacent mining activities.

B. If you decide to proceed with the reclamation project after this consultation, you and the 

regulatory authority must concur in the following determinations. 

1. Determine the limits on any coal refuse, waste or deposits which can be extracted 

under the Federal and state regulations.

2. Delineate the boundaries of the AML project

C. You must keep the determinations made in sections A and B above in the project file. 

You must document who made the determinations and the information they considered. 

D. You must complete the following special requirements for each project.
G-8

1. Characterize the site in terms of mine drainage, active slides and slide-prone 

areas, erosion and sedimentation, vegetation, toxic materials and hydrologic 

balance.

2. Ensure that the reclamation project is conducted in accordance with the 

requirements for AML reclamation projects in 30 CFR Part 874.

3. Develop site-specific reclamation requirements, including performance bonds 

when appropriate.

4. Require the contractor to provide documents that clearly authorize the extraction 

of coal and the payment of royalties before reclamation begins.

E. If the reclamation contractor extracts coal beyond the limits of the incidental coal as 

specified in the determinations, they must obtain a permit under Title V of SMCRA.

4-100-110 What happens to AML funds that you don’t use?

A. Generally, unused funds remain available for award to your state or tribe for a future 

grant. Unused funds include funds distributed to you but not awarded in a grant, and 

funds awarded to you in a grant but not spent.

B. However, there are two exceptions to this general rule. In the following situations, we 

will recover funds and redistribute them to other states and tribes.

1. We will move unused state or tribal Share Funds in accordance with section 

402(g)(1)(D) of SMCRA. If any State or Tribal Share Funds are not expended 

within three years after the date they are first awarded in a grant, or within five 

years for grants during fiscal years 2008, 2009, and 2010, we will move them to 

historic coal funds. Similarly, we will move any State or Tribal Share Funds 

which have not been awarded in a grant within five years of their distribution, or 

within five years for 2008, 2009, and 2010 funds, to historic coal funds. We will 

distribute funds moved to historic coal to eligible states at the next annual 

distribution.

2. We will move unused state emergency program funds to a central pool. We may 

distribute funds from that central pool on request to any minimum program state 

with a specific emergency need. At our discretion, we may use unused funds in 

this pool for other purposes.
G-9

CHAPTER 4-110

ANNUAL DISTRIBUTION OF TITLE IV GRANT FUNDS

4-110-00 What does this chapter do?

4-110-10 Where do these requirements come from?

4-110-20 What is a mandatory distribution? 

4-110-30 What types of Title IV funding are included in the annual AML mandatory 

distribution?

4-110-40 What are our offices responsible for in the mandatory distribution process?

4-110-50 How do we process the annual AML mandatory distribution?

4-110-60 How will we distribute appropriated Title IV Funds to you?

4-110-00 What does this chapter do?

This chapter explains our process for distributing Title IV grant funds. The annual distribution 

process identifies the total Abandoned Mine Land (AML) funding available for this fiscal year, 

which types of AML funds are included, and how much is available to each eligible state and 

tribe. After this process is completed, the funds identified for your state or tribe are available for 

us, the Office of Surface Mining Reclamation and Enforcement (OSMRE), to award to you in a 

grant. 

4-110-10 Where do these requirements come from?

Title IV of the Surface Mining Control and Reclamation Act of 1977 (SMCRA), Public Law 95-

87, as amended, authorizes multiple types of AML funds. It establishes how they are distributed 

or appropriated, and how we must make them available to you, that have approved reclamation 

programs. 

4-110-20 What is a mandatory distribution? 

The mandatory annual distribution authorized by SMCRA is the source of most of your AML 

funding. These funds do not have to be appropriated each year by Congress. The funds are “off 

budget” and not included in our annual funding request or subject to appropriations laws that 

provide most Federal funds.

4-110-30 What types of Title IV funding are included in the annual AML mandatory 

distribution?

SMCRA authorizes a mandatory annual distribution for the following types of Title IV funds. 

You must have an approved reclamation program to receive any of these funds: 

A. State or Tribal Share Funds.

1. It is authorized in section 402(g)(1) of SMCRA. Its source is the AML Fund. We 

abbreviate it in our accounting system as SS. 
G-10

2. We distribute it only to uncertified states and tribes. 

3. Each year we will distribute 50% of the reclamation fee collections for coal 

produced in the previous fiscal year (FY) in your state, or on Indian lands within 

your tribe’s jurisdiction. 

4. We will phase in State Share Funds at 50% of the total that is required for FY 

2008 and 2009, 75% for FY 2010 and 2011, and fully fund it in FY 2012 through 

2022.

B. Historic Coal Funds.

1. They are authorized in section 402(g)(5) of SMCRA. Its source is the AML 

Fund, and we abbreviate them as HC. 

2. We distribute them to uncertified states and tribes. You are eligible for historic 

coal if you have an inventory of unfunded Priority 1 and 2 coal problems greater 

than your State or Tribal Share Funding. 

3. Total annual historic coal funding is 30% of total national reclamation fee 

collections for coal produced in the previous FY. It also includes 60% of any 

other revenues to the AML fund except interest from investment activities. It also 

includes money we transfer from State or Tribal Share after we distribute the 

equivalent amounts for Treasury Prior Balance Replacement Funds or Certified in 

Lieu Funds to certified states and tribes. 

4. We divide total historic coal between the eligible states by formula based on 

historic coal mining production in each state before the passage of SMCRA. 

5. We will phase in Historic Coal Funds at 50% of the total that is required for FY 

2008 and 2009, 75% for FY 2010 and 2011, and fully fund it for FY 2012 through 

2022.

C. Minimum Program Make-up Funds.

1. They are authorized in section 402(g)(8) of SMCRA. Its source is the AML 

Fund. Minimum Program Make-up Funds is the only mandatory distribution 

from the Secretary’s 20% share of total reclamation fee collections. We 

abbreviate it as FE.

2. SMCRA sets a minimum funding level of $3,000,000 for each uncertified state or 

tribal program. You are eligible for Minimum Program Make-up Funds if you 

have an inventory of unfunded Priority 1 and 2 coal problems greater than the 

total funding your state or tribe would otherwise receive. 
G-11

3. If an eligible state or tribe would otherwise receive less than $3,000,000, we 

distribute enough Minimum Program Make-up Funds to increase your total 

funding from all shares to $3,000,000. 

4. We will phase in Minimum Program Make-up Funds at 50% of the total that is 

required for FY 2008 and 2009, 75% for FY 2010 and 2011, and fully fund it for 

FY 2012 through 2022.

D. Prior Balance Replacement Funds.

1. They are authorized in section 411(h)(1) of SMCRA. Its source is the General 

Fund of the Treasury. Our accounting system abbreviates Prior Balance 

Replacement Funds for uncertified states as HU, and for certified states and tribes 

as HS.

2. We distribute them to all states and tribes which had an unappropriated balance of 

State or Tribal Share Funds in the AML Fund as of October 1, 2007. Both 

uncertified and certified states and tribes may receive them. 

3. Each state or tribe will receive total payments of prior balance replacement funds 

equal to its unappropriated prior balance. We divide the total into seven equal 

annual payments. We distributed the first payment in FY 2008. 

4. When we distribute Prior Balance Replacement Funds, we transfer the equivalent 

amounts in the AML Fund from State or Tribal Share to Historic Coal Funds. We 

will distribute these funds to eligible states and tribes in FY 2023, and in 

subsequent years.

5. We will not phase in these payments. 

E. Certified in lieu funds.

1. They are authorized in section 411(h)(2) of SMCRA. Its source is the General 

Fund of the Treasury. We abbreviate them as H2.

2. We distribute them to certified states and tribes only.

3. We distribute an amount equal to 50% of reclamation fee collections on coal 

produced in the previous FY in your state, or on lands under your tribe’s 

jurisdiction. We distribute these funds in lieu of the AML Fund moneys for the 

State and Tribal Share that they are no longer eligible to receive. 
G-12

4. When we distribute Certified in Lieu Funds, we transfer the equivalent amounts in 

the AML Fund to Historic Coal and distribute them each year as part of the 

Historic Coal distribution. 

5. We will phase in Certified in Lieu Funds at 25% of the total otherwise required in 

FY 2009, 50% in FY 2010, 75% in FY 2011, and fully fund them in FY 2012 

through 2022. We will distribute the amounts we held back during the phase-in 

as two equal payments in FY 2018 and 2019.

4-110-40 What are our offices responsible for in the mandatory distribution process?

A. The Director approves the distribution of Title IV funds. 

B. The Division of Reclamation Support (DRS) issues distribution instructions, reviews the 

final distribution calculation for correct application of policy and procedures, and 

recommends approval of the distribution. DRS also has the lead role in answering policy 

questions regarding AML distribution. 

C. The Division of Financial Management (DFM) determines the amount of Title IV funds 

to be distributed to each state and tribe in accordance with this chapter. DFM provides an 

electronic version of the annual distribution to be posted on the OSMRE web site. DFM 

and the Office of Planning, Analysis and Budget (OPAB) coordinate to ensure that the 

allotments are properly recorded in the financial system. DFM has the lead role in 

answering questions regarding financial figures used in the distribution. 

D. OPAB works with the DFM to request a warrant from Treasury for the approved amount 

of Treasury funds to be distributed. OPAB allots all distributed funds to the regions. 

E. The regional directors (RDs) and the regional and field offices provide technical 

assistance and training to the states and tribes to explain the annual distribution process 

and calculations. They review the proposed distribution to verify that their states and 

tribes are properly handled. They answer questions about how the distribution affects 

each program, and the options available to the state or tribe to use the distributed funds. 

4-110-50 How do we process the annual AML mandatory distribution?

A. DRS will define the distribution parameters based on SMCRA and OSMRE regulations 

and directives. Before the reclamation fee collection cut-off date each FY, DRS will send 

DFM a memorandum with detailed procedures for calculating this FY’s mandatory 

distribution. 

B. DRS will also send DFM an Enhanced Abandoned Mine Land Inventory System (eAMLIS) report showing the total cost of the unfunded Priority 1 and 2 coal problem areas 

remaining in each state or tribal inventory. The report will be used to determine 

eligibility for Historic Coal and Minimum Program Make-up Funds.
G-13

C. DFM will determine the amount of reclamation fee collections for coal produced in the 

previous FY for each state and tribe. In order to expedite the distribution, DFM will cut 

off collections for each FY on November 30 or as close as administratively feasible. 

Collections for each FY will be net of any adjustments made to prior year collections. 

D. Within seven days of the collections cut-off date, DFM will send their proposed 

distribution to DRS. DFM will prepare a distribution package showing distribution 

amounts, calculations, and supporting data.

E. DRS will review the calculations to assure correct application of policies and parameters. 

DRS will also send the proposed distribution to the RDs for their review. DRS will work 

with DFM to resolve any concerns. Within seven days of receipt of the distribution 

package from DFM, DRS will prepare a memorandum outlining its acceptance of 

distribution calculations and requesting the Director's approval.

F. The OSMRE Director will approve the AML grant distribution.

G. OPAB will request a warrant from the Department of the Treasury for the approved 

amount.

H. DRS will send the approved distribution package to OPAB and DFM. OPAB and DFM 

will coordinate implementation of the distribution in the budget and financial systems. 

The distribution will also be provided to RDs for use in their offices and by states and 

tribes. DFM will provide an electronic version of the approved distribution package for 

posting on the OSMRE web site. 

4-110-60 How will we distribute appropriated Title IV Funds to you?

Congress may appropriate additional Title IV grant funds for state and tribal reclamation 

programs each year. We will distribute these funds to you as soon as practicable after we receive 

the appropriation. DRS will develop distributions based on the requirements of the 

appropriations law. The Director will approve the distributions. DRS will provide the 

distribution to OPAB and DFM and the RDs. OPAB and DFM will coordinate implementation 

of the distribution in the budget and financial systems, and will provide the distribution to the 

public.

State emergency program grant funding must be appropriated. We will distribute funding based 

on your requests. DRS will ask the RDs to obtain estimates from you for your emergency 

program needs in the upcoming fiscal year. Emergency grant estimates should not include 

amounts for contingencies or extremely large one-time events. State emergency program 

requests will be reviewed by the ROs. The ROs will send state estimates and regional 

recommendations to DRS.
G-14

CHAPTER 4-120

STATE EMERGENCY AML RECLAMATION PROGRAM

4-120-00 What is an AML emergency? 

4-120-10 What is the objective of the AML emergency program? 

4-120-20 How does state emergency funding work?

4-120-30 What are our responsibilities?

4-120-40 What are your responsibilities?

4-120-50 What are the grant funding procedures for the state emergency program?

4-120-60 What should your initial investigation procedures include?

4-120-70 What must you include in your request for an emergency declaration?

4-120-80 How will we review your request and process an emergency declaration?

4-120-90 What are the emergency project progress reporting requirements?

4-120-100 What do you do if the emergency project needs a scope change?

Exhibit 1 AML Emergency Program Guidelines

Exhibit 2 Compliance with the National Historic Preservation Act

Exhibit 3 Compliant Information Gathering Guide

Exhibit 4 AML Compliant Investigations

Exhibit 5 National Pollution Discharge Elimination System Storm Water Discharge 

Permits

4-120-00 What is an AML emergency? 

We, the Office of Surface Mining Reclamation and Enforcement (OSMRE), define an 

Abandoned Mine Land (AML) emergency as a sudden danger or impairment related to coal 

mining that presents a high probability of substantial physical harm to the health, safety, or 

general welfare of people before the danger can be abated under normal AML program operation 

procedures.

4-120-10 What is the objective of the AML emergency program? 

The objective of the emergency reclamation program is to stabilize the emergency aspects of the 

problem by eliminating the immediate danger to public health, safety, and welfare. Any 

remaining reclamation should then be accomplished as part of a regular non-emergency AML 

project.

 

4-120-20 How does state emergency funding work?

A. Only states who are eligible for minimum program funding and who have an approved 

emergency reclamation program are eligible to receive and expend funds for AML 

emergency projects provided that funding is available. If funding is not available, all 

states or tribes may only use their other funding sources to address and pay for the 

emergency problem. You may not transfer funding to the emergency cost category from 

non-emergency cost categories. You must submit reports for the emergency projects 

within the non-emergency cost categories.
G-15

B. Sites must be eligible for AML funding. See FAM Chapter 4-100 for more information 

on site eligibility.

C. You can only use emergency program grant funds for emergency hazard abatement. 

Emergency funding is limited. To be fair to other programs, we cannot allow you to use 

emergency funds for any additional work beyond what is necessary to abate the hazard.

D. A major consideration of the emergency program is determining the proper split between 

the use of emergency, and non-emergency AML funds to fully reclaim a problem area 

when the use of emergency funds is required to address the problem quickly. We will 

monitor your use of emergency funds in the same manner as we monitor your use of 

other AML funds. When you determine that a problem should be reclaimed using both 

emergency and non-emergency project funds, use the following procedures.

1. Consult with us before we define the extent and scope of the emergency. If we 

agree that a problem should be reclaimed using both emergency and nonemergency funding, we will make the final determination concerning how much

of a project should be funded with emergency funds.

2. You will determine the extent and scope of non-emergency work.

3. You are responsible for managing the emergency funds to ensure that funding 

limits are not exceeded.

E. You cannot use emergency program funds for any of the following types of high priority 

projects.

1. Exploratory and design work for projects which have the potential to deteriorate 

into emergencies. 

2. Projects which need prompt attention but require considerable evaluation efforts.

3. Projects which will require more than six months to complete. 

4-120-30 What are our responsibilities?

Our regional or field office will perform the following functions.

A. Receive and review applications and awarding assistance agreements.

B. Declare emergencies. We will determine whether the problem meets the definition of 

emergency under 30 CFR 700.5, and our emergency program guidelines (see Exhibit 1 at 

the end of this chapter). We also approve the scope of work necessary to abate the 

emergency.
G-16

C. Work with you to ensure appropriate use of emergency funds. 

D. Assure compliance with National Environmental Policy Act, P.L. 91-190, (NEPA) and 

OSMRE REG-1, Handbook on Procedures for Implementing the National Environmental 

Policy Act (NEPA Handbook) (Revised 2019). 

E. Assure compliance with the National Historic Preservation Act, P.L. 89-665, (NHPA). 

(See Exhibit 2 of this chapter for more information.) 

F. Assure that you have met the requirements of the Endangered Species Act, P.L. 93-205, 

the Clean Water Act, P.L. 92-500, and any other applicable Federal, state or tribal, and 

local laws imposed for the protection of the environment.

G. Monitor performance of reclamation activities and expenditure of emergency grant funds.

4-120-40 What are your responsibilities?

You must perform the following functions.

A. Respond to emergency complaints, tracking complaints and individual reclamation 

project progress, and monitoring all emergency program costs.

B. Ensure that emergency abatement activities are conducted in accordance with your 

approved reclamation plan, and the guidelines in Exhibit 1 of this chapter.

C. Ensure that project funds are properly allocated and expended when projects contain both 

emergency and non-emergency work.

A. Assist us in complying with NEPA, our NEPA Handbook, and the National Historic 

Preservation Act (NHPA).

E. Comply with the Endangered Species Act, the Clean Water Act, and any other applicable 

Federal, state or tribal, and local laws imposed for the protection of the environment.

F. Award and manage contracts for services necessary to abate emergency conditions, 

including rights of entry, appraisals, and other realty requirements.

4-120-50 What are the grant funding procedures for the state emergency program?

A. If you require emergency project funding, you may submit an amendment application for 

specific emergency project costs.

D. We normally approve emergency program funding for a period of one year.
G-17

E. We will deobligate any funds unexpended at the end of the one year performance period.

4-120-60 What should your initial investigation procedures include?

A. You perform initial investigations of AML citizen complaints. However, we encourage 

you to contact us to determine if a joint inspection is practical. 

B. You should normally use the following procedures for your initial investigation.

1. Visit the problem site within two working days after receipt of the complaint. If 

the problem appears to be of an emergency nature, promptly notify our regional or 

field office. We can provide assistance if needed. 

2. Your field investigation should obtain all pertinent information. See Exhibit 3, 

Complaint Information Gathering Guide, and Exhibit 4, AML Compliant

Investigation,” for guidance on the information needed.

3. Note any procedures required by NEPA (see the NEPA Handbook for more 

information), NHPA, Endangered Species Act, Clean Water Act, or any other 

Federal, state or tribal, or local requirements imposed for protection of the 

environment.

4. If appropriate, notify emergency assistance organizations and local authorities of 

conditions at the site so that they can take immediate protective steps such as 

fencing or street closing.

5. Determine if local or other state or tribal institutions, such as the county highway 

department, can and will correct the problem.

6. If you should need non-emergency funds to complete reclaiming the site, you 

should discuss the situation with us. If non-emergency funds are needed, you 

should take action to get the necessary funds, or to include the problem in your 

AML inventory. 

7. If required, get information necessary for an appraisal.

4-120-70 What must you include in your request for an emergency declaration? 

Regardless of funding source, you must submit the following materials to us for each proposed 

emergency before we can declare it. However, in certain situations we may agree to declare an 

emergency with only the information we need immediately, and allow you to provide the 

remaining information afterward. The size of the project usually determines how much 

discussion you need about abatement alternatives.
G-18

A. Your investigation report. You may use an optional OSM-51 form, a state form, or any 

narrative or bullet-type description to provide the following information.

1. Project objective: Describe the project objective in relation to the definition of an 

emergency (a sudden danger or impairment that presents a high probability of 

substantial physical harm to the health, safety, or general welfare of people before 

the danger can be abated under normal program operation procedures). Show 

how the project will abate the danger. Evaluate alternative abatement methods if 

there are any, to show that the most effective, and cost efficient method is being 

used. 

2. Approach: Briefly describe the project schedule, scope of work, and expected 

accomplishments.

3. Bonds: Identify the existence or absence of any bonds or other financial 

guarantees associated with the disturbed area, and provide specific details on 

those which have been released, forfeited and expended, or are otherwise 

unavailable. If a bond or other financial guarantee has been forfeited but not 

expended, it must be applied to the work to be done. A commitment to do that 

from the holder of the bond is required. This commitment may initially be verbal, 

documented in a telephone log, but a written commitment must follow. If the 

amount of the unexpended bond funds or other applicable financial guarantees is 

inadequate to complete emergency reclamation, you can use emergency funds. 

4. Non-emergency work: Estimate the cost of any non-emergency work associated 

with the emergency project. You may not use emergency funds to complete the 

non-emergency portion of a project. Indicate whether non-emergency funds will 

be available to complete the reclamation, or whether the non-emergency portion 

will be included in your inventory for future funding.

5. Maps: Include maps showing location of the problem and of any active mining in 

the area. 

B. Approval. An authorized official of your organization must sign or approve your 

recommendation for emergency action.

4-120-80 How will we review your request and process an emergency declaration?

A. Upon receipt of your request for emergency declaration, we will review the information 

and ensure that the project meets the requirements listed below. We may visit the site to 

verify the information contained in your report.

1. The project meets the criteria for an emergency.

2. The scope of work is reasonable to abate the emergency hazard. 
G-19

3. An authorized official of your state or tribe signed or approved the emergency 

recommendation and scope of work.

4. If the project is in proximity to any active mining or mined area, or we may 

reasonably expect that reclamation activities could impact such an area, we will 

contact the appropriate Federal and/or state or tribal Mine Safety and Health 

Administration agency to determine if site conditions or probable reclamation 

activities could affect the health and safety of mine workers. We have discretion 

to apply the "proximity" and "reasonably expect" criteria based on the specific 

site conditions.

5. The project will comply with NEPA and NHPA. The state or tribe will comply 

with the Endangered Species Act, Clean Water Act, and any other Federal, state 

or tribal, and local requirements imposed for the protection of the environment.

6. The request includes the information on the status of any bond(s) or other 

financial guarantee(s) associated with the disturbed area as required in the 

previous section.

7. If part of the site will be referred to or funded by the non-emergency program, 

there is documentation of planned coordination with the non-emergency AML 

program. 

B. We will process the emergency declaration as follows.

1. We declare an emergency by signing a Finding of Fact/Authorization To Proceed 

(ATP). The Finding of Fact certifies that the problem meets the criteria of an 

emergency, and qualifies for available emergency funding. It also serves as the 

point of Federal action, authorizing you to proceed with reclamation work on the 

site. 

2. Our authorized official must approve the Finding of Fact. We should complete 

this approval within two working days of receiving your information.

3. We may approve a limited emergency response based on verbal information when 

we determine that delaying issuing a Finding of Fact until all required information 

is available could result in substantial physical harm to the health, safety, or 

general welfare of people. Before doing so, we must assure that you or we have 

met the environmental compliance requirements applicable when emergency 

circumstances at the site require immediate abatement action. We can later 

approve an expanded scope of work after receiving and reviewing more complete 

information. 

4. The Finding of Fact must include the following information:
G-20

a. Project name and other identifying information. Include the Problem Area 

(PA) number if the problem is in the Enhanced Abandoned Mine Land 

Inventory System (e-AMLIS).

b. Project location should be specifically stated and detailed as to street, 

township, and county. 

c. Condition which requires emergency abatement.

d. Declaration that the project meets the definition of an emergency using the 

criteria given in Exhibit 1.

e. Scope of work, including the following:

(1) A description of actions to be taken, and an explanation why those 

actions are necessary to stabilize the emergency aspects of the 

problem by eliminating the danger to public health, safety, and 

general welfare.

(2) Documenting planned coordination with the recipient's nonemergency AML program if a portion of the problem is to be 

reclaimed using emergency program funds and the remainder 

reclaimed or funded under the recipient's non-emergency AML 

program.

f. Documented compliance with NEPA and our NEPA Handbook. If there is 

an immediate threat of substantial physical harm, and the emergency 

action must be completed before the required NEPA document can be 

completed, you may submit environmental and other information to assist 

us in making the required determination.

g. Documented compliance with NHPA.

5. If the project appears to be an emergency, our reviewer prepares and signs the 

Finding of Fact/ATP, and forwards it to our authorized official for approval and 

signature. We will notify you immediately that the emergency has been 

approved; we will send you a copy of the signed Finding of Fact/ATP.

C. Emergency Denial. If we determine that a complaint does not constitute an AML 

emergency, we must give you a written determination within two working days. If you 

determine it to be an eligible high priority AML problem, we may assist you in 

submitting timely NEPA documentation. Special consideration should be given to those 

problems which do not currently meet the criteria for emergency declaration but which 

may deteriorate into emergencies if not reclaimed promptly. As appropriate on a case-
G-21

by-case basis, this assistance could include help with the documentation to enter the 

problem in e-AMLIS, preparation of the Environmental document, or other technical 

assistance as needed. Contact our regional or field office to request assistance. 

4-120-90 What are the emergency project progress reporting requirements?

A. You must include emergency projects in your annual and final AML performance reports 

(see Chapter 4-230 for information on reporting). Your performance report narrative 

must include the following information on emergency projects.

1. Name of project.

2. Date work started on project.

3. Discussion of abatement measures and their success or failure.

4. Original contract(s) cost estimates.

5. Final project cost.

6. Date work was completed on the project. (Do not include final revegetation if it 

was delayed awaiting proper weather conditions)

B. You must enter AML inventory information into e-AMLIS for all approved emergency 

projects at project completion to show your accomplishments. 

4-120-100 What do you do if the emergency project needs a scope change?

Generally, our approval is not necessary for changes to the scope of an emergency project. 

However, you must address the impact of the scope change on the environmental documents 

using the appropriate alternative below.

A. If you prepared the NEPA related documents and conducted the required consultations, 

you must prepare any necessary revised documents to address additional environmental 

impacts from the proposed scope change, and submit those documents to us.

B. If we prepared the NEPA related documents and conducted the required consultations, 

you must notify us prior to making changes in the scope of work. We will review the 

existing NEPA document and findings, and change the existing documents as necessary. 

Additional findings must be made to ensure that the proposed changes are in 

conformance with applicable requirements. 
G-22

Exhibit 1

AML EMERGENCY PROGRAM

GUIDELINES

1. Emergency Criteria

As defined in 30 CFR 700.5 an emergency is a sudden danger or impairment that presents a high 

probability of substantial physical harm to the health, safety, or general welfare of people before 

the danger can be abated under normal program operation procedures. For an AML problem to 

be declared an emergency the answers to the following three questions must be yes.

a. Was there a sudden event?

b. Is there a high probability of substantial physical harm to the health, safety, or 

general welfare of people?

c. Does the emergency condition need to be abated in a time frame that is not

possible under normal state/tribal program procedures in order to protect the 

health, safety, or general welfare of people?

2. Proper Response to Declared Emergencies

The proper amount of emergency reclamation is the amount necessary to stabilize the emergency 

aspects of the problem by eliminating the immediate danger to public health, safety, and general 

welfare. Any remaining reclamation should then be accomplished as part of a regular, nonemergency AML project. 

Emergency reclamation must be sufficient to stabilize conditions and eliminate the hazards until 

the remaining non-emergency reclamation can be undertaken. When non-emergency 

reclamation is needed after abatement of the emergency, the project should be classified as a 

high priority if the remaining reclamation needs to be done expeditiously. This action will help 

prevent deterioration of the emergency work already completed. 

It is not appropriate to use emergency program funds for exploratory and design work for high 

priority projects which have the potential to deteriorate into an emergency situation. The design 

work should be done as part of the normal AML program.

3. Specific Guidance for Selected Types of AML Problems

a. Surface Burning (SB). Surface Burning is an emergency when it threatens to burn 

occupied dwellings or when it is producing poisonous or dangerous gases, (e.g., 

carbon monoxide, hydrogen sulfide, etc.) and suddenly begins to threaten people. 

The presence of poisonous gases must be confirmed through the collection and 

laboratory analysis of ambient air samples or the use of a hand held monitor. 
G-23

Most refuse pile fires are characterized by noxious fumes, smoke, and open fires. 

While these conditions may be annoying, they do not normally constitute an 

emergency and should be considered under the regular AML grant program.

When non-emergency fires suddenly expand and threaten any inhabited 

structure(s) or poisonous gases suddenly begin to threaten people, emergency 

action will be considered to eliminate the threat.

Refuse fires are easier and cheaper to extinguish if discovered early. Therefore, 

notwithstanding the criteria for emergency definition discussed above, fires which 

are discovered at an early stage may be treated as emergencies.

b. Gases/Underground Burning (GUB). Underground mine fires are considered 

emergencies when they threaten to burn occupied dwellings, either directly or by 

starting surface fires, or when they produce poisonous or dangerous gases (e.g. 

carbon monoxide, hydrogen sulfide, etc.). The presence of poisonous gases must 

be confirmed through the collection and laboratory analysis of ambient air 

samples or the use of a hand held monitor.

Normally, inventoried underground mine fires are not sudden occurrences and do 

not present an immediate danger to the public. The states/tribes will, generally, 

conduct abatement or control procedures through normal program operations. 

However, emergencies may be declared when these fires suddenly break to the 

surface or where poisonous gases generated by the fire suddenly begin to threaten 

people.

As with Surface Burning, underground mine fires are easier and cheaper to 

extinguish if discovered early. Therefore, notwithstanding the criteria for 

emergency definition discussed above, fires which are discovered at an early stage 

may be treated as emergencies.

c. Dangerous Slides (DS). Dangerous slides are emergencies when there is 

immediate danger to the occupants of dwellings which are, or could be, 

endangered by the slide. In some cases, a slide may be considered an emergency 

when it blocks a stream, threatening upstream or downstream flooding. Blockage 

of roadways and driveways may be considered an emergency if access for 

emergency vehicles is prevented and no highway maintenance agency can act to 

clear the roadway.

Where these situations occur, emergency AML work will address only the 

emergency portion of the landslide. Permanent reclamation of the entire slide 

area may be considered when the emergency cannot be stabilized without it or it 

is clearly demonstrated that it is not cost effective to delay full reclamation. 

Where emergency work abates the emergency but achieves less than permanent 
G-24

reclamation, the remaining work should be considered under the regular AML 

grant program.

d. Portals (P) and Vertical Openings (VO). Vertical Openings are emergencies 

when there is a risk of falling into the opening. A portal can be an emergency 

when there is a substantial danger of entering the opening and being subjected to 

either fall material (e.g., roof rock or mine timbers) or an inhospitable mine 

atmosphere, such as methane and /or low oxygen conditions. The possibility of 

mine explosions from methane buildup would also create an emergency situation.

Historically, mine openings were often capped or sealed at the conclusion of 

mining with no provisions for continuous maintenance. Subsequent surface 

activities or vegetation may have covered or hidden these openings. The sudden 

uncovering of a previously unknown shaft or other mine opening in a populated 

area will generally be considered an emergency. Open shafts, although 

previously detected, which are now considered to be in or near populated areas 

may be treated as emergency work.

An opening which exposes persons to poisonous gases should be declared an 

emergency. The presence of poisonous gases should be confirmed when this can 

be done safely and conditions allow meaningful sampling. This may be 

accomplished through the collection and laboratory analysis of ambient air 

samples or the use of a hand held monitor.

e. Subsidence (S). Emergencies resulting from subsidence involve the danger of 

falling into the opening and/or the risk of damage to occupied dwellings, 

threatening the safety of occupants. Subsidence damage that significantly affects 

the structural integrity of occupied dwellings or adversely affects gas or electric 

lines is usually an emergency. Subsidence beneath a roadway may be treated as 

an emergency only when a roadway maintenance agency cannot act to correct the 

problem.

f. Other Problem Types. While the five problem types above represent those most 

commonly associated with emergencies, this Directive does not preclude other 

problem types from being declared an emergency. The problem must meet the 

emergency criteria as set forth in Section 1 of these guidelines and follow other 

guidance provided in this Directive.
G-25

Exhibit 2

COMPLIANCE WITH THE NATIONAL

HISTORIC PRESERVATION ACT

The Advisory Council on Historic Preservation’s (ACHP) regulations at 36 CFR Part 800 

established procedures to protect historic and archeological resources and implement Section 106 

of the National Historic preservation Act (NHPA). NHPA requires a review of Federal 

emergency projects to determine the effect on historic properties.

Under the Federal Reclamation Program, the Office of Surface Mining Reclamation and 

Enforcement (OSMRE) is responsible for all the activities set out below. Under state-managed 

emergency programs, the state is responsible, except that OSMRE decides when immediate 

action must be taken to protect the public and must document findings in the Finding of Fact.

This appendix sets out the steps to follow when emergency construction can be initiated within 

30 days of OSMRE declaring the emergency. If construction cannot be initiated within 30 days 

of OSMRE declaring the emergency, the regular NHPA procedures must be followed. In no 

event will an emergency action necessary to prevent substantial physical harm to the health, 

safety, or general welfare of people be delayed in order to meet NHPA requirements.

The first step in the review process is to determine whether any historic properties might be 

affected by the emergency project. Historic property includes any prehistoric or historic district, 

site, building, structure, or object included in, or eligible for inclusion in, the National Register of 

Historic Places (NR). For the purpose of this directive, the term also includes artifacts, records 

and remains that are related to and located within such properties. The term “eligible for 

inclusion in the NR” includes both properties formally determined as such by the Secretary of 

the Interior and all other properties that meet NR listing criteria at 36 CFR 800.2(e).

While few emergency projects potentially affect historic properties, the following steps should 

be taken for each emergency project.

1. If no historic properties are found that may be affected by the emergency abatement 

project you will document this in the Finding of Fact for state/tribe managed emergency 

projects. You must send a copy of the documentation to the state Historical Preservation Officer 

(SHPO) or tribal leaders. No further steps in the Section 106 process are required.

Please note that, within the context of this appendix, the term SHPO includes tribal leaders if the 

project is on tribal lands and briefing paper includes the Finding of Fact for state/tribe projects.

2. If a historic property is found that may be affected by the emergency abatement project, 

whoever declares the emergency will contact the SHPO. In consultation with the SHPO, you 

will use the Criteria of Effect, pursuant to 36 CFR Part 800.9(a), to determine if the historic 

property will be affected. If all parties are satisfied that the historic property will not be affected 
G-26

this will be noted in the briefing paper. OSMRE/state will photograph the property. No further 

steps in the Section 106 process are required.

3. If there are concerns that the emergency abatement may adversely affect a historic 

property, all parties will make a reasonable attempt to resolve the concerns before work begins. 

If the concerns are resolved the briefing paper will:

(a) describe the historic property and explain how it will may be affected; and

(b) specify the concerns of the SHPO and explain how they were resolved.

After the abatement has been accomplished, any agreed upon information will be sent to the 

SHPO and a copy will be included with the emergency project’s final report.

4. If the SHPO has concerns which cannot be resolved and OSMRE determines that 

immediate action must be taken, the briefing paper must include:

(a) a description of the SHPO’s concerns;

(b) an explanation of why emergency abatement must be initiated immediately to prevent 

substantial physical harm to the health, safety, or general welfare of people; and

(c) a description of the emergency work to be done, its impact on the historic property(s), 

and the measures to be used to avoid or minimize harm to historic properties.

OSMRE/state will photograph the property and then take only that emergency action required to 

prevent immediate substantial physical harm to the health, safety, or general welfare to people.

When the emergency has been stabilized, OSMRE/state will provide the SHPO with 

photographs, maps, and a description of the actual impact on the property. A copy of this 

information will be included with the emergency project’s final report. If additional work is 

required to complete reclamation, the regular NHPA procedures must be followed.

5. If it is not possible to contact the SHPO (for example, on a weekend) and OSMRE 

determines that immediate action must be taken. Photograph the property, and then take only 

that emergency action required to prevent immediate substantial physical harm to the health, 

safety, or general welfare of people. Note in the briefing paper that an unsuccessful effort was 

made to contact the SHPO and notify him/her at the first opportunity.

Guidelines for Photographs of Historic Properties
G-27

It is recommended that the SHPO be contacted beforehand to determine what is required of 

photographs of historic properties. In lieu of specific guidance from the SHPO, the following 

guidelines should be followed.

Photograph Type: You may use digital photographs, or color or black and white film. Polaroid 

type photographs are not acceptable.

Buildings or structures:

Environment: Photograph should show the environment in which the property is located.

Exterior: Photographs must include views which show the entire length and/or width of the 

building or structure. These can be used to identify the style of the building and the type of 

construction.

Elements: Photographs should show the elements of the building or structure, such as wall and 

roofs that contain repeated features such as doors, windows and large decorative details. 

Additional photographs should be taken of the individual features of the elements, such as 

porches, entryways and large significant decorative aspects. Machinery should be photographed.

Details of the Features: Close-up photographs of unusual windows, doors, and repeated designs 

and motifs should be taken. Also, include views of typical work methods and materials.

Historic and archeological sites: Photographs should document the condition of the site and 

present features. If relevant to the evaluation, photographs may also show artifacts that have 

been recovered from the site. Photographs must show the physical environment and land 

configuration of the site.

Identification: Identification of photographs should contain the following:

• The name of property/site.

• The location, including the State, county, city and address (if relevant).

• The emergency project name and number.

• The date of photograph.

• The role and negative number. 

• Location where the negative is stored.

• A description of what the photograph is showing.
G-28

Exhibit 3

COMPLAINT INFORMATION GATHERING GUIDE

1. Was there a sudden event? When did it occur, if known?

2. Is there a high probability of substantial physical harm to the health, safety, or general 

welfare of people?

3. Does the problem have to be addressed immediately to protect health, safety, or general 

welfare of people?

4. How many people are endangered and to what extent?

5. How soon does the problem need to be addressed? (What is the urgency?)

6. What is the history of mining in the area?

7. If the mining operator is known, does he/she have continuing reclamation responsibility?

8. Are there any bonds associated with the disturbed area? 

9. What is the source of the problem and where is it located?

10. How does the problem relate to past coal mining practices?

11. Is access to the property safe?

12. If needed, have the residents secured alternative housing within the commuting area?

13. Have photographs of all aspects of damaged property been taken (including inside of 

houses).

14. Is there a potential for any emergency abatement to impact the environment (NEPA), historic 

properties (NHPA), public utilities, private water supplies, or water waste disposal systems?

15. Does the current problem indicate a seasonal or other periodic (non-random) fluctuation that 

may change at a later date?

16. What can the landowner, mineral owner, and/or municipal agencies do?

17. What is the state’s or tribe’s regular AML program willing to do and when?

18. What is the local community willing to do and when?

19. What are the utility companies willing to do and when?

20. What are other state/tribal and Federal agencies willing to do and when?

21. Is an insurance company responsible?

22. Was the owner involved in or benefited from mining?

23. Are active mines operating in the area?
G-29

Exhibit 4

AML COMPLAINT INVESTIGATION

Type of Complaint: ___________________________Reported by: _____________________

Address: ____________________________________________________________________

Telephone: ___________________________________________________________________

Date OSMRE Received Complaint: _______________________________Time:____________

Date OSMRE Field Office Received Complaint: _____________________Time:____________

OSMRE Person Receiving Complain_______________________________________________

Address of Complaint: __________________________________________________________

City: _________________________County:_____________________State:_______________

SITE INVESTIGATION

Date: ________Time:________ OSMRE Investigators: ________________________________

State representative(s) Present: _________________________________________________

____________________________________________________________________________

Others Present: _______________________________________________________________

____________________________________________________________________________

Name of other agencies contacted (local, state or Federal): ____________________________

____________________________________________________________________________

LOCATION OF SITE

Directions to Location (Describe Route): ____________________________________________

____________________________________________________________________________

____________________________________________________________________________

USGS Quadrangle Name: _______________________________________________________

Coordinates: _________________________________________________________________

____________________________________________________________________________

AREA MINED

Mined by: ____________________________________________________________________

Address: _________________________________________City: _______________________

State: __________________Zip Code: ____________Telephone Number: ________________

Permitted Operation: No___ Yes ___ Permit Number(s) ______________________________
G-30

Was the property owner involved in the mining? Yes ___ No____ If yes, explain: ___________

____________________________________________________________________________

____________________________________________________________________________

Duration of Mining: From________________________ Until ___________________________

Type of Mining: _______________________________________________________________

Field Elevation: _______________Coal Elevation: _____________Seam Name: ____________

BOND (Optional)

Amount Received: ____________________________________Date_____________________

Amount Returned: ____________________________________Date_____________________

Amount Forfeited: ____________________________________Date_____________________

Amount Available: ____________________________________Date_____________________

PRESENT OWNERS

Surface Owners: Name: ________________________________________________________

Address: ____________________________________________________________________

City: __________________State: _______Zip Code: _________Telephone: _______________

Mineral Owner’s Name: _________________________________________________________

Address: ____________________________________________________________________

City: _________________State: ________Zip Code: _________Telephone: ______________

AFFECTED PARTIES

Name: ______________________________________________________________________

Address: ____________________________________________________________________

City: ________________________State: ____Zip Code: __________Telephone: ___________

Land Owner: __________________________ Adjacent Owner: _________________________

Name: ______________________________________________________________________

Address: ____________________________________________________________________

City: ________________________State: ____Zip Code:_________Telephone: ____________

Land Owner: __________________________Adjacent Owner: _________________________

SITE INFORMATION

Date problem began or was first noticed:____________________________________________

Are there any active mining or related activities in or around the area? No____ Yes____

Name of Operators(s) __________________________________________________________
G-31

Nature of Problem: Source of Problem:

_____ Water Discharge _____ Underground Mine

_____ Sedimentation _____ Surface Mine

_____ Flooding _____ Processing Area

_____ Air Pollution _____ Refuse Pile

_____ Slide _____ Treatment Facility

_____ Void, Shafts, Slope, Entries, etc. _____ Other, Specify _________________

_____ Mine Fire ___________________________________

_____ Subsidence ___________________________________

_____ Other, Specify __________________

Potentially Affecting:

_____ Persons . . . . . Estimated Number______________________________________

_____ Streams . . . . . Name________________________________________________

_____ Public Road . . Name________________________________________________

_____ Housing . . . . . Number______________________________________________

_____ Building . . . . . Number______________________________________________

_____ Schools . . . . . Name________________________________________________

_____ Utility . . . . . . . Power Line_____________________Treatment Plant__________

Sewer Line_____________________Gas Line_______________

Water Line__________________________________________

_____ Historic or archeological site(s) Number_______________________________________

_____ Other, Specify___________________________________________________________

Estimate acres Affected_________________________________________________________

NATURE OF PROBLEM

Describe the problem (details: i.e., size shape; is problem spreading, expanding; first noticed, 

etc.): ________________________________________________________________________

____________________________________________________________________________

____________________________________________________________________________

OTHER INFORMATION

Describe what other information is available and its location (i.e., maps, inspections, etc.):

____________________________________________________________________________

____________________________________________________________________________

____________________________________________________________________________

ELIGIBIITY (Optional)

State legal officer Notification

Name:_______________________________________________________________________

Address:_____________________________________________________________________

City:____________________ State:________ Zip Code:__________Telephone:____________

Method Used

Oral______Date______ Written______ Date______
G-32

Declaration of Eligibility from state

Name:_______________________________________________________________________

Address:_____________________________________________________________________

City:_____________________State:_________Zip Code:__________Telephone:___________

Method Used

Oral______ Date______ Written______ Date______

Eligible: Yes______No______Explain_____________________________________________

____________________________________________________________________________

POTENTIAL NEPA PROBLEMS

Note any potential National Environmental Policy Act Related problems. See REG-1, Handbook 

on Procedures for Implementing the National Environmental Policy Act (NEPA). Actual 

responsibility for complying with NEPA rests with the RD.

REMARKS

INVESTIGATOR: ______________________________________________________________

______________________________________________________________________________

Name: ______________________________________________________________________

____________________________________________________________________________

Address: _____________________________________________________________________

____________________________________________________________________________

City: _________________________________State: ________________ Zip Code: _________

Telephone:____________________________
G-33

Exhibit 5

NATIONAL POLLUTION DISCHARGE ELIMINATION SYSTEM 

STORM WATER DISCHARGE PERMITS

Background

The 1987 amendment to the Clean Water Act required the United States Environmental 

Protection Agency (EPA) to regulate storm water discharges in the National Pollution Discharge 

Elimination System (NPDES). Final regulations for permit applications for storm water 

discharges were published on November 16, 1990. The NPDES regulates storm water 

discharges from municipal and industrial activities, including mining, inactive mines, and 

construction sites. Also, for those states and Indian lands where they are responsible for issuing 

Storm Water Discharge Permits, EPA published NPDES general permits in the September 9, 

1992, Federal Register, 57 FR 41176.

States and Indian tribes may apply to EPA for approval to issue permits and administer their own 

pollution Discharge Elimination System. Most states have done so and are responsible for 

regulating storm water discharges with EPA providing guidance and oversight. However, in 

those states or Indian tribes that do not have the authority to issue permits, EPA remains the 

authorizing agency.

Storm Water Discharge Permits

The agency responsible for abandoned mine land reclamation (OSMRE, state, tribe) must ensure 

that all applicable permits are obtained.

When obtaining a permit from EPA a Notice of Intent must be submitted two days prior to the 

commencement of construction and a storm water pollution plan must be developed and 

implemented. See 57 FR 41176 for detailed instructions.

Specifics for storm water discharge permits will vary by state or tribe. Check with your state 

agency or EPA representatives to determine the permit requirements for the proposed 

disturbance. 

Emergencies

Emergency action necessary to prevent substantial physical harm to the health, safety, or general 

welfare of people must not be delayed by procedures for obtaining a storm water discharge 

permit. After the emergency is stabilized, if a storm water discharge permit is required, that 

permit must be obtained before any additional work is begun.
G-34

CHAPTER 4-130

ACID MINE DRAINAGE SET-ASIDE PROGRAM

4-130-00 What does this chapter do?

4-130-10 Where do these requirements come from?

4-130-20 Who may establish an Acid Mine Drainage Fund?

4-130-30 What money can you use for your AMD set-aside?

4-130-40 How may you spend funds from the AMD set-aside account?

4-130-00 What does this chapter do?

This chapter explains procedures for you to establish, fund, and operate an acid mine drainage 

(AMD) set-aside account. The set-aside program allows you, the recipient of an Abandoned 

Mine Land (AML) program grant from us, the Office of Surface Mining Reclamation and 

Enforcement (OSMRE), to deposit some AML funds into the AMD set-aside account, and use 

the funds and interest for AMD problems.

4-130-10 Where do these requirements come from?

The AMD abatement and treatment program is authorized in Section 402(g)(6) of the Surface 

Mining Control and Reclamation Act, as amended (SMCRA). It was first authorized in 1990. 

The 2006 SMCRA amendments increased the funding limits and removed a previous 

requirement for us to approve an AMD plan. 

4-130-20 Who may establish an Acid Mine Drainage Fund?

You may establish an AMD set-aside fund if you are a state or tribe with an approved 

reclamation program which has not certified it has completed coal reclamation. 

4-130-30 What money can you use for your AMD set-aside?

A. Each year you may keep and deposit the following funds into your AMD set-aside 

account.

1. Up to thirty percent (30%) of the State or Tribal Share Funds distributed to you 

this year. State or Tribal share funds (abbreviated in our accounting system as 

SS) are authorized by section 402(g)(1) of SMCRA.

2. Up to thirty percent (30%) of the historic coal funds distributed to you this year. 

Historic Coal Funds (HC) are authorized in section 402(g)(5).

3. Please refer to Chapter 4-500 for a full listing of available AML subaccounts and 

fund types.

B. You may not put Prior Balance Replacement Funds (HU) or Minimum Program Make-up 

Funds (FE), in an AMD set-aside account.
G-35

C. You should apply for the set-aside funds, and we will award them, as a separate

subaccount within your annual AML program grant. 

4-130-40 How may you spend funds from the AMD set-aside account?

A. You must spend amounts from the fund, together with all interest earned, for the 

abatement of the causes and treatment of the effects of AMD in a comprehensive manner 

within a qualified hydrologic unit affected by coal mining practices. 

B. A “qualified hydrological unit” means a hydrologic unit which meets the following 

requirements: 

1. Water quality has been significantly affected by acid mine drainage from coal 

mining practices in a manner that adversely impacts biological resources.

2. The unit contains lands and waters that meet both the following requirements.

a. Eligible under section 404 of SMCRA, and include any of the coal 

priorities described in section 403(a).

b. The subject of expenditure from the forfeiture of a bond under section 509 

or from other State sources to abate and treat acid mine drainage. 

C. We consider all funds you deposit in the set-aside account, plus interest earned, to be 

state or tribal funds. 

D. You may use funds in the AMD set-aside account to meet another Federal grant 

program’s matching requirement as long as the goals of the other program are 

comparable to set-aside program. 
G-36

CHAPTER 4-140

AML SPECIAL FUTURE SET-ASIDE PROGRAM

4-140-00 What does this chapter do?

4-140-10 Where do these requirements come from? 

4-140-20 Can you put more money in a future set-aside account?

4-140-30 What can you do with funds in a future set-aside account? 

4-140-00 What does this chapter do?

This chapter explains procedures for special Abandoned Mine Land (AML) future set-aside 

program funding awarded to you, a state or tribal recipient, by us, the Office of Surface Mining 

Reclamation and Enforcement (OSMRE).

4-140-10 Where do these requirements come from? 

The AML special or future set-aside program was authorized, then changed, and finally 

abolished by Congress in amendments to the Surface Mining Control and Reclamation Act 

(SMCRA). In 1987, Congress established the future set-aside program to allow states and tribes 

with approved AML programs to set aside AML funds to use for mine reclamation after the end 

of AML funding. The initial set-aside allowed you to spend the funds after August 3, 1992, for 

the purposes of Title IV. In 1990, Congress amended the program to allow you to spend the 

funds after September 30, 1995, for the coal priorities in section 403(a). In 2006, Congress 

abolished the future set-aside program. 

4-140-20 Can you put more money in a future set-aside account?

No, you cannot put any more AML funds in a future set-aside account. 

4-140-30 What can you do with funds in a future set-aside account? 

A. We will consider all set-aside funds deposited in your set-aside account, plus any interest 

earned, as state or tribal funds.

B. You may spend funds in the set-aside account according to the terms in effect at the time 

we awarded each grant. 

1. You must spend funds awarded under the 1987 set-aside, and related interest, for 

the purposes of Title IV of SMCRA.

2. You must spend funds awarded under the 1990 set-aside, and related interest, for 

any of the coal priorities in section 403(a) of SMCRA.
G-37

C. You can use funds in the set-aside account to meet a non-Federal funding match 

requirement for another Federal assistance program. However, the goals of the other 

program must meet the spending requirements for the AML set-aside program.
G-38

CHAPTER 4-150

AML SUBSIDENCE INSURANCE PROGRAM

4-150-00 What does this chapter do?

4-150-10 Where do these policies come from?

4-150-20 What is a subsidence insurance program?

4-150-30 What types of AML funds and how much funding may you use?

4-150-40 How does subsidence insurance funding work in your AML grant?

4-150-50 What costs are allowable and unallowable?

4-150-60 How must you use subsidence insurance premiums?

4-150-00 What does this chapter do?

This chapter explains the rules governing the subsidence insurance program. As a state or tribe 

with an approved reclamation program, you may receive subsidence insurance funding through 

your Abandoned Mine Land (AML) program grant from us, the Office of Surface Mining 

Reclamation and Enforcement (OSMRE).

4-150-10 Where do these policies come from?

A. Section 401(c)(1) of the Surface Mining Control and Reclamation Act of 1977 (SMCRA) 

authorizes you to operate a subsidence insurance program. 

B. OSMRE regulations at 30 CFR 887 governing the subsidence insurance program provide 

more information.

4-150-20 What is a subsidence insurance program?

Subsidence insurance programs insure private property against damages caused by land 

subsidence resulting from underground coal mining. Programs are administered by your state or 

tribe. They must be self-sustaining.

4-150-30 What types of AML funds and how much funding may you use?

A. If you have certified that you have completed your coal reclamation priorities, you may 

use any AML funds for subsidence insurance.

B. If you are uncertified, you may only use state or tribal share funds for subsidence 

insurance funding. State/Tribal share is authorized in section 402(g)(1) of SMCRA and 

abbreviated as SS in our accounting system. 

C. Total cumulative subsidence insurance funding for each state or tribe must not exceed 

$3,000,000. We may award funds up to this total in one single AML grant or in a series 

of grants.
G-39

D. Our regional or field office must ensure that these requirements are met when it awards 

your grant.

E. Please refer to Chapter 4-500 for a full listing of available AML fund types.

4-150-40 How does subsidence insurance funding work in your AML grant?

A. We will award subsidence insurance funds as a subaccount within your annual AML 

grant.

B. Your application must include a statement in the program narrative describing how you 

will use the funds to achieve a self-sustaining, individual state or tribal administered 

program to insure private property against subsidence resulting from underground coal 

mining. It must also describe how the program is “state-administered” or “tribaladministered”. 

C. The performance period of a subsidence insurance subaccount may be up to eight years.

4-150-50 What costs are allowable and unallowable?

A. The following costs are allowable with subsidence insurance funds.

1. You may cover capitalization requirements and initial reserve requirements 

mandated by State law. However, you must ensure that your expenditures are 

consistent with the OMB cost principles in 2 CFR Part 200 Subpart E.

2. You may pay administrative costs to establish and operate the subsidence 

insurance program.

B. The following costs are unallowable with subsidence insurance funds.

1. You must not use AML funds for lands that are not eligible for AML funding 

under section 404 of SMCRA. 

2. You must not pay for subsidence damage caused by active mining.

3. You must not pay for actual construction costs of housing or for damages to 

public property.

4-150-60 How must you use subsidence insurance premiums?

A. You must treat subsidence insurance premiums as program income. See Chapter 2-210

for guidance on using and reporting program income.
G-40

B. You must use all subsidence insurance premiums received to further the goals of the 

subsidence insurance program. We authorize you to use program income to add to the 

program funding (the Addition option). 
G-41

CHAPTER 4-160

ENVIRONMENTAL COMPLIANCE

4-160-00 Where can I find information on Environmental Compliance?

4-160-10 Do these requirements apply to you?

4-160-00 Where can I find information on Environmental Compliance?

For instruction on compliance with the National Environmental Policy Act, P.L. 91-190 (NEPA), 

refer to OSMRE REG-1, Handbook on Procedures for Implementing the National 

Environmental Policy Act (NEPA Handbook) (Revised 2019).

4-160-10 Do these requirements apply to you?

These requirements apply to the Abandoned Mine Lands (AML) Reclamation program and any 

other reclamation or construction projects. 
G-42

CHAPTER 4-170

THE AUTHORIZATION TO PROCEED PROCESS 

4-170-00 What does this chapter do?

4-170-10 What is the Authorization to Proceed (ATP)?

4-170-20 What is the ATP approval process?

Exhibit 1 Authorization to Proceed

4-170-00 What does this chapter do?

This chapter explains how you, a state or tribe with an Abandoned Mine Land (AML) grant, can 

get approval from us, the Office of Surface Mining Reclamation and Enforcement (OSMRE), to 

proceed with construction on a specific reclamation project. 

4-170-10 What is the Authorization to Proceed (ATP)?

A. You must request and receive our approval before you begin construction on an 

individual non-emergency coal and non-coal project. We call the process in which you 

request and we approve individual projects the Authorization to Proceed (ATP). 

B. Our ATP letter (Exhibit 1) notifies you that we have determined that the environmental 

review is complete and the problem area information is properly recorded in the 

Enhanced Abandoned Mine Land Inventory System (e-AMLIS). The ATP is our 

approval for you to spend AML grant funds to reclaim or address this specific project. 

You may proceed with project construction as soon as you receive the ATP.

C. The ATP is the official “Point of Federal Action” for AML construction activities. 

Because you do not have to include information on individual AML projects in your 

grant application, we do not approve them in the grant award. After approval of your 

AML grant, you must request the ATP for each project when you are ready.

D. The ATP process also meets OMB requirements for an assistance application to identify 

specific project objectives, results, benefits expected, approach, and geographic location. 

You normally fulfill this requirement when you send us environmental compliance 

documentation and when you enter site information into the funded category in eAMLIS.

E. Individual projects receiving Federal funds awarded to certified states and tribes 

(pursuant to 30 CFR §885.16) and uncertified states and tribes (pursuant to 30 CFR 

§886.16), must receive an ATP from OSMRE prior to the expenditure of construction 

funds. Individual projects include coal reclamation projects (30 CFR Part 874) and noncoal projects (30 CFR Part 875). OSMRE's finding that an emergency condition 

exists, constitute as an ATP for emergency projects conducted under section 410 of 

SMCRA (Chapter 4-120). ATPs for certified states and tribes will be issued based 

on 30 CFR §875.15 and the prioritization matrix detailed in each state's/tribe's 
G-43

reclamation plan. All ATP documents must be kept in the official grant file.

4-170-20 What is the ATP approval process?

A. You must include the following information in a complete ATP request.

1. Confirmation that you have entered the problem area information into e-AMLIS 

in compliance with directive AML-1. Until the ATP is issued, problem features 

proposed for reclamation shall be entered in the unfunded category for the 

particular site.

2. Environmental documents with compliance information for the National 

Environmental Policy Act (NEPA) and other environmental requirements. See 

OSMRE REG-1, Handbook on Procedures for Implementing the National 

Environmental Policy Act (NEPA Handbook) (Revised 2019) for a detailed 

description of the appropriate environmental compliance information and 

documents. This criteria is not fulfilled until OSMRE has signed a Record of 

Decision (ROD), Finding of No Significant Impact (FONSI), or Categorical 

Exclusion (CE).

3. AML eligibility statement and basis for claiming AML eligibility.

4. For AML enhancement projects, or Title IV projects less than 50% 

governmentally funded, the determinations document you developed jointly with 

the Title V State regulatory authority. See Chapter 4-100-100 for more 

information. 

B. Although NEPA documentation is part of the criteria required for an ATP request, the 

NEPA process and the ATP process are two separate processes. An ATP request cannot 

be completed until OSMRE has issued a ROD, FONSI, or CE with the NEPA 

documentation. The ATP approval letter will reference the date that OSMRE signed the 

ROD, FONSI, or CE.

C. We will process the ATP request within 14 working days after the signing of the 

ROD, FONSI, or CE, and send you OSMRE’s decision on your ATP request in writing.
G-44

EXHIBIT 1

Authorization to Proceed

[State Agency]

[Address]

Dear [State AML Director]

The Office of Surface Mining Reclamation and Enforcement (OSMRE) has determined that the 

[name of project] has met the following criteria:

1. The project has been entered into the Enhanced Abandoned Mine Land Inventory System 

(e-AMLIS) as [problem area xxxxxx] in compliance with Directive AML-1.

2. Environmental documents, including compliance information for the National 

Environmental Policy Act (NEPA) and other environmental requirements and 

documented with a [Record of Decision (ROD), Finding of No Significant Impact 

(FONSI), or Categorical Exclusion (CE)] on [Date of signed ROD, FONSI, or CE].

3. The ATP request included an AML eligibility statement and basis for claiming AML 

eligibility. 

4. (If project is an AML enhancement project or Title IV projects less than 50% 

governmentally funded) – The ATP request included a determination document that 

you developed jointly with the Title V State regulatory authority.

Accordingly, pursuant to 30 CFR 886.16, you are authorized to proceed with this project and 

expend Federal funds in accordance with AML grant terms and conditions. If this project 

provides funding to a subrecipient through a subaward, the subrecipient must be approved by 

OSMRE separately from this ATP. OSMRE subrecipient approval can be requested either 

through the initial award application or through a separate request.

Sincerely

[Regional Director or Field Office Director]
G-45

CHAPTER 4-200

THE APPLICATION PROCESS FOR AN AML GRANT

4-200-00 What does this chapter do?

4-200-10 How does the AML grant work?

4-200-20 How do you send us your application for an AML grant?

4-200-30 When should you apply?

4-200-40 What should you include in your application?

4-200-00 What does this chapter do?

This chapter explains how you, a state or tribe with an approved Abandoned Mine Land (AML) 

program that has not certified, can apply to us, the Office of Surface Mining Reclamation and 

Enforcement (OSMRE), for an AML grant. This chapter does not apply to states or tribes which 

have certified that they have addressed all known coal problems (see Chapter 4-300). This 

chapter also explains how your AML grant works.

4-200-10 How does the AML grant work?

A. You may submit a single grant application each year for all AML activities. This 

combined annual grant is sometimes called “simplified” because it consolidates AML 

functions which we used to award as separate grants into a single grant award. 

B. The AML budget or cost categories which are combined into this single grant are called 

subaccounts. AML subaccounts are costs which you must track separately, such as 

administrative costs and project costs for non-emergency coal reclamation. See Chapter 

4-500 for a full listing of available AML subaccounts. 

C. The performance periods for all subaccounts included in an agreement normally start on 

the beginning date of the agreement. However, we may later add a new subaccount 

which starts on the date of the grant amendment which added it. For example, 

immediately after the annual fund distribution you may apply for an amendment to add 

current AMD set-aside funds to the previous year’s AML grant in order to deposit the 

set-aside funds sooner and earn additional interest. 

D. The grant performance period is determined by the subaccount with the longest 

designated period in the AML grant. The grant performance period is normally three 

years. However, within the grant performance period, you can only obligate funds for 

each subaccount within its specified performance period. The subaccount performance 

periods end on different dates.

1. All administrative cost subaccounts last for one year.

2. All project cost subaccounts except emergency project costs last for three years.
G-46

3. Emergency project cost subaccounts last for one year.

4. AMD set-aside subaccounts last until you deposit the funds into your trust 

account.

5. Subsidence insurance subaccounts last for eight years. 

E. When a subaccount ends before the end of the grant performance period, we normally 

close the subaccount. If there are any unexpended funds, we deobligate them or transfer 

them to a different subaccount or grant as you request. 

F. We track grant property through the administrative cost subaccount. When we close the 

administrative subaccount, we will note your transfer of AML property into the 

administrative cost subaccount of the subsequent AML grant or your disposition of the 

property.

4-200-20 How do you send us your application for an AML grant?

A. You must submit a complete grant application to us by one of the following methods. 

1. You may enter your application in an OSMRE-approved electronic grants portal 

such as Grants.gov. 

2. You may send us a complete application on paper with an original signature. You 

may have the application delivered to us by regular mail or any other method. 

3. You may send us an application package by e-mail. The application forms must 

include the name and title of the authorized official who signed them and the date 

they were signed. You must keep the original signed application in your files.

B. We will notify you that we have received your application within three days of the date 

we receive it.

4-200-30 When should you apply?

A. You may apply at any time for a grant of any or all of the AML funds that are available to 

you.

B. You should send us your application at least 60 days before the date you want your grant 

performance period to begin.

4-200-40 What should you include in your application?

A. We do not require detailed information on individual AML construction projects in the 

AML grant application. 
G-47

B. Your application must include the following items: 

1. Signed or approved Application for Federal Assistance, Standard Form (SF) 424.

2. Budget information. You may use the optional OSMRE 49 form, or provide the

information in an alternate format of your choice.

3. Break out the funding you are requesting by subaccount. Please refer to Chapter 

4-500 for a full listing of available AML subaccounts.

4. The program narrative statement should include the following information. 

a. Regulations at 2 CFR Part 200 require that the program narrative 

address the following criteria. However, information on specific 

reclamation projects is not required: 

Objectives and Need for Assistance. Based on your approved AML 

state program, describe any relevant abandoned mine land problems 

(physical, economic, social, financial, or institutional) requiring a 

solution. Indicate the need for the assistance and state the primary 

and secondary objectives of the grant. 

Results and Benefits Expected. Identify results and benefits to be 

derived from the reclamation program. For example, describe how 

the reclamation program will protect public health and safety, and 

improve the environment. 

Approach. Outline a plan of action for the scope of the grant and 

describe how the proposed work will be accomplished. Cite factors 

(such as weather, eligibility issues, etc.) which might help or delay the 

work. Explain your reasons for taking this approach as opposed to 

others. Describe any unusual features of this grant, such as design or 

technological innovations, and reductions in cost or time. Identify the 

kinds of data to be collected and maintained. Discuss the criteria and 

methodology to be used to evaluate the results and success of the 

reclamation program. 

Geographic Location. No information required.

b. You must include the following additional information in your 

application: 

Personnel. List the number and type of full-time equivalent positions 

supported by this grant.
G-48

Fringe Benefits. Show the basis and estimated total amount of fringe 

benefits.

Travel. Show how the travel expenses were calculated. Estimate the 

number of trips, their purpose, and average costs. 

Equipment. List each item of equipment requested and explain why 

it is needed for the program. Estimate the total cost of equipment to 

be purchased, leased or rented. 

Supplies. Estimate the total cost for supplies and describe any major 

or unusual items. 

Contractual. List proposed contracts with their purpose and estimated 

cost.

Other. List costs by type and explain how you estimated them. 

Indirect Costs. Show how you calculated estimated indirect costs 

based on the indirect cost rate and base approved by your cognizant 

Federal agency.

5. Signed or approved Assurances for Construction Projects form SF 424D.

6. If applicable, Disclosure of Lobbying Activities form SF LLL.
G-49

CHAPTER 4-210

APPLICATION REVIEW AND PROCESSING FOR AN AML GRANT

4-210-00 What does this chapter do?

4-210-10 How long will we take to review your application and award your grant?

4-210-20 How do we review your application?

4-210-30 How do we process your grant award?

4-210-40 How do we document our review and award actions?

4-210-00 What does this chapter do?

This chapter explains procedures used by us, the Office of Surface Mining Reclamation and 

Enforcement (OSMRE), to receive and review your Abandoned Mine Land (AML) grant 

application, and to award your grant. These procedures apply only to grants for states and tribes 

which have not certified the completion of coal reclamation. If your program has certified, see 

the procedures in Chapter 4-300.

4-210-10 How long will we take to review your application and award your grant?

We will process all complete AML grant applications within 60 calendar days of receipt. 

4-210-20 How do we review your application?

Our awarding office must take the following actions. 

A. Determine that the application is complete. See Chapter 4-200 for the requirements for a 

complete application. 

B. Determine that the proposed objectives and activities are appropriate for your program.

C. Confirm availability of funds. 

D. Check the budget. Confirm that the proposed costs are allowable. Confirm that the 

budget uses AML fund types appropriately. 

E. Identify and resolve any questions or issues.

F. Check the System for Award Management (SAM) to determine whether your 

organization or its officials are debarred, suspended, voluntarily excluded or ineligible for 

Federal assistance.

G. Confirm that you are in compliance with the single audit requirements found at 2 CFR 

Part 200 Subpart F.

H. Assess the risks associated with awarding you a grant.
G-50

4-210-30 How do we process your grant award?

A. Based on this review, our awarding office will decide whether to approve or disapprove 

your application. If we decide to approve it, we will award your AML grant. If we 

disapprove your application, we will notify you of our decision in writing. 

B. Before making the award, we will send information about the award to our Office of 

Communications for Congressional and public news release. Our awarding office must 

follow the notification procedure established by the Office of Communications.

C. We must process and approve the grant award through our electronic grants system. Our 

accounting system will post the award into the grant payment system so that the funds 

will be available for you to draw down.

D. We will send you the approved award document, by e-mail or in hard copy.

4-210-40 How do we document our review and award actions?

We will document our application reviews and all programmatic and financial findings and 

recommendations in the official grant file kept in the awarding office. The following list of 

required documentation is only a minimum. Awarding offices must include any additional 

supporting information which would help an outside reviewer to understand the application 

review process and award decision for a particular grant.

A. Your application as we originally received it, all subsequent revisions, and any other 

information you sent us.

B. Records of all meetings or telephone conversations with your organization which 

provided information about the application.

C. All our correspondence with you about the application or the award decision.

D. All our internal reviews of the application or parts of the application. We will use a 

checklist to document application completeness.

E. All explanations or resolutions of questions rose during the review process.

F. All records or explanations of the timing of the award process, especially any time period 

when the awarding office could not process the award because it was waiting for actions 

outside its control, such as your responses to questions.
G-51

CHAPTER 4-220

AMENDMENTS AND POST-AWARD CHANGES FOR AN AML GRANT

4-220-00 What does this chapter do?

4-220-10 Where do these requirements come from?

4-220-20 How can you request changes to a grant?

4-220-30 What changes require a formal grant amendment?

4-220-40 What is the process for a grant amendment?

4-220-50 What changes must we approve in a letter?

4-220-60 How do you make all other changes?

4-220-00 What does this chapter do?

This chapter explains policy and procedures used by us, the Office of Surface Mining 

Reclamation and Enforcement (OSMRE), for Abandoned Mine Land (AML) grant amendments. 

It explains which changes to grants require our prior approval, either in a formal grant 

amendment or in a letter. This information applies to all your AML grants and cooperative 

agreements if your state or tribe has not certified that you have completed coal reclamation. If 

your AML program has certified, see Chapter 4-300 for guidance on amendments.

4-220-10 Where do these requirements come from?

Requirements for changing the terms of a grant come from the Uniform Administrative 

Requirements, Cost Principles, and Audit Requirements for Federal Awards, at 2 CFR 200, 

subpart D. 

4-220-20 How can you request changes to a grant?

A. If your change requires our prior written approval, you must apply for and receive our 

approval before you make the change or obligate any funds. If you incur any costs before 

we approve the change, the costs may not be allowed.

B. We will not approve any request for a change to an agreement (including a time 

extension, funding increase, or changes in the subaccounts) which we receive after the 

scheduled end of the performance period. We will only make an exception if there are 

unforeseen circumstances not under your direct control, and if you justify these 

extenuating circumstances to the satisfaction of the authorized official in our awarding 

office.

C. We should receive requests to extend the performance period of your grant at least 30 

days before the date it is scheduled to end. Normally we will approve only one extension 

of the performance period and we will not extend the time for more than one year. We 

will only make an exception if you justify the special or unusual circumstances to our 

satisfaction. 
G-52

4-220-30 What changes require a formal grant amendment?

We must approve the following changes to your AML grant in a formal amendment document: 

A. Extend the performance period.

B. Add more funds to the grant.

C. Deobligate unneeded funds.

D. Add a new subaccount to the grant.

E. Transfer funds from one subaccount to another.

4-220-40 What is the process for a grant amendment?

A. Either you or we may initiate a grant amendment. However, we must both agree on the 

amendment terms. 

B. You should make multiple changes by a single amendment whenever possible.

C. You must submit an amendment application using by e-mail or by regular mail. The 

amendment application must include the following.

1. Signed or approved Form SF 424, identifying the type of change you are 

requesting in item 8.

2. A narrative explanation and justification for the requested change. You may use 

the optional OSMRE 51 form, or your transmittal letter or any other format.

3. If your request will change the budget or the subaccounts, provide revised budget 

information. You may use the optional OSMRE 49 form or any alternative 

format showing the proposed subaccounts and amounts.

D. We will process AML amendments, except emergency funding, using the same steps as 

new grants that are outlined in Chapter 4-210. However, we will approve or disapprove 

your complete amendment request within 30 days of receiving it. We will only notify the 

Office of Communications for Congressional and public announcement if the amendment 

increases the grant funding by more than $100,000.

E. We will process amendments for additional emergency funding as quickly as possible 

using accelerated review and approval procedures. We recognize that it is important not 

to delay abatement of an emergency hazard. 
G-53

F. The amendment takes effect when the authorized official in our awarding office approves 

it in our electronic grant system. The amendment applies to the entire grant performance 

period unless otherwise stated. The approved amendment becomes part of the original 

agreement. 

G. Amendments closing out the administrative subaccount of your AML grant also require 

submittal of all required closeout reports, including financial and performance reports and 

property inventories. See Chapter 4-230 for information on financial and performance 

reports, and Chapter 4-240 for information on closing out an AML subaccount.

H. We will notify you when we have approved the amendment action and we will send you 

the appropriate documentation.

4-220-50 What changes must we approve in a letter?

You are required you to get our prior written approval for some changes which do not require 

formal grant amendments. You must request these changes, and we will approve them, in 

writing with a letter or e-mail. The following changes require our written approval.

A. OMB Cost principles found in 2 CFR Part 200 Subpart E, state that some cost items are 

allowable only if you have our prior approval. 

B. Significant changes in the scope of your program may require our written approval. For 

example, subgranting major activities of your program to another entity would require 

our approval. However, changes such as reorganizations or new administrative systems 

would not require our approval.

4-220-60 How do you make all other changes?

A. You may make all other changes without our approval. However, you must notify us in 

writing of the change.

B. You do not need our approval for changes to a specific AML construction project which 

fits the broad scope or objectives of an AML project costs subaccount unless you need 

additional funding for the subaccount. However, you may need to revise and resubmit 

the environmental compliance (NEPA) and Authorization to Proceed (ATP) documents 

for the project. See Chapter 4-170 for the ATP process and OSMRE REG-1, Handbook 

on Procedures for Implementing the National Environmental Policy Act (NEPA 

Handbook) (Revised 2019) for more information on the NEPA process.
G-54

CHAPTER 4-230

PERFORMANCE AND FINANCIAL REPORTING FOR AN AML GRANT

4-230-00 What does this chapter do?

4-230-10 Where do these requirements come from?

4-230-20 When must you submit reports? 

4-230-30 How can you submit reports? 

4-230-40 What information must you provide?

4-230-50 Are there any alternatives to these reporting requirements?

4-230-60 How will we review your reports? 

4-230-00 What does this chapter do?

This chapter explains the reports required from you, a state or tribe that received an Abandoned 

Mine Land (AML) grant from us, the Office of Surface Mining Reclamation and Enforcement 

(OSMRE). It describes, when your reports are due, how to submit them, and what information 

you must report. This information applies to you if your state or tribal reclamation program has 

not certified that it has completed coal reclamation. If your program has certified, see Chapter 4-

300 for information on your reporting requirements.

4-230-10 Where do these requirements come from?

The requirements for submission of recipient performance and financial reports are established in 

the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal 

Awards, at 2 CFR 200, Subpart D.

4-230-20 When must you submit reports? 

You must submit programmatic and financial reports to us annually. These reports are due 90 

days after the end of each 12-month reporting period. 

A. Your first annual report will normally be a final report for the subaccounts within your 

grant that last one year, such as administrative costs. The reporting period starts on the 

effective date of the grant and ends on the last day of the performance period of the 

closing subaccounts.

B. Your second annual report will normally be an interim report. You may choose whether 

to end the report period on the same day of the year as your first report or on the next 

calendar quarter end date: March 31, June 30, September 30, or December 31. For 

example, if your grant begins on March 1, you could end the second report period on 

February 28 or extend it to March 31.

C. If your grant performance period is extended beyond three years, you must complete an 

annual interim report for each 12-month period.
G-55

D. The final report for the grant has a report period ending on the last day of the 

performance period. You will find further guidance on AML close out reports in Chapter 

4-240.

E. If you cannot meet a due date on a required report, contact our awarding office. We may 

extend the report due date if you have an adequate justification and your report is not yet 

overdue.

4-230-30 How can you submit reports? 

A. You may submit reports by regular mail. Hard copy reports must have original 

signatures.

B. You may also submit reports by e-mail. If you e-mail your reports, the forms must 

include the name and title of the authorized official who signed them, the date signed, 

and you must maintain the original signed forms in your files. 

4-230-40 What information must you provide?

A. Financial Report.

1. You have options for your financial reporting: 

a. Complete the SF 425, Federal Financial Report, and SF 425A attachment 

form.

b. Complete the optional OSMRE 49 Budget Information and Financial 

Reporting Form. 

2. The report must break out your expenditures by subaccount and by fund type. If 

the report method or form you use does not provide this level of detail, you must 

attach a document which breaks out the reported costs.

3. You must prepare your OSMRE financial reports on a cash basis. 

B. Narrative Performance Report.

1. You may use the optional OSMRE 51 form, a blank page, or any narrative format 

for your performance report.

2. The report must list all reclamation sites worked on during the performance 

period. At a minimum, the report must include the following information for each 

site: the site name, problem area identification number, start date, completion 

date if completed, keyword accomplishments, and costs to date. 
G-56

3. If your completed problem area is in the OSMRE Enhanced Abandoned Mine 

Land Inventory System (e-AMLIS) you don’t need to duplicate it in the 

performance report but you must include the appropriate e-AMLIS key for the 

completed problem area. 

4-230-50 Are there any alternatives to these reporting requirements?

Yes. After receiving our approval, you may submit grant performance and financial report 

information in an alternative format or timeframe. This gives you flexibility in providing grant 

performance data in a manner that is more efficient and effective while still meeting our grant 

performance data needs. We will be as flexible as possible in approving alternative grant 

performance reporting schedules or formats. Please contact our awarding office to work out an 

alternative reporting plan that is acceptable to both you and us. However, if we have not 

approved an alternative reporting plan, you must comply with the performance and financial 

reporting requirements outlined above.

4-230-60 How will we review your reports? 

A. We will review your programmatic and financial reports. We will verify and determine if 

you have complied with the reporting requirements and provided all the information we 

need. The following list is a minimum review. 

1. An official authorized to act for your organization must sign or approve the 

reports. Reports received by e-mail must include the name and title of the 

authorized official who signed the original forms, and the date signed.

2. We must receive reports by the due dates.

3. All reported activities and claimed costs must be in compliance with the approved 

state plan and Federal regulations.

4. Programmatic reports must compare the planned and actual accomplishments of 

AML program activities.

5. Financial reports must be mathematically accurate and is consistent with our 

drawdown records. 

6. All claimed costs must be supported by your accounting records and you must be 

able to reconcile them.

B. If any concerns are identified, our awarding office will work with you to correct the 

report. 

C. We will prepare a monitoring statement to document our review.
G-57

CHAPTER 4-240

CLOSING AN AML GRANT

4-240-00 What does this chapter do?

4-240-10 Where do these requirements come from?

4-240-20 When do we close out an AML agreement?

4-240-30 When is your closeout package due?

4-240-40 How can you submit these reports? 

4-240-50 What information must you submit to close out an AML grant? 

4-240-60 How do you report and how do we close an AML subaccount?

4-240-70 How will we review your information and close your grant?

4-240-00 What does this chapter do?

This chapter describes what must be done to close the Abandoned Mine Land (AML) grant you 

received from us, the Office of Surface Mining Reclamation and Enforcement (OSMRE). It also 

describes how to close a completed AML subaccount. This chapter applies to you if your state 

or tribal reclamation program has not certified that it has completed coal reclamation. If your 

state or tribe has certified, see Chapter 4-300 for grant closeout information.

4-240-10 Where do these requirements come from?

The requirements for closeout procedures come from the Uniform Administrative Requirements, 

Cost Principles, and Audit Requirements for Federal Awards, at 2 CFR 200 subpart D.

4-240-20 When do we close out an AML agreement?

A. We normally close out an AML grant 180 days after the end of the grant performance 

period. The first 90 days allows you to report to us. The remaining 90 days allows us to 

complete the closeout process. 

B. We normally close out individual AML subaccounts when they end before the end of the 

grant performance period. We close the subaccount no later than 180 calendar days after 

it ends.

C. We may close AML grants without audit. However, we may take additional

administration action after closeout if a subsequent audit identifies findings or questioned 

costs.

D. We will not close a grant until you have paid all allowable costs and we have deobligated 

all unexpended funds.

E. We will not close a grant if it is in litigation or under appeal.
G-58

F. If we terminate a grant, we will not close it until all termination actions have been 

completed.

4-240-30 When is your closeout package due?

A. Your complete closeout package is due to us 90 days after the end of the grant 

performance period.

B. If you have made every reasonable effort to send us a complete closeout package within 

90 days but cannot meet the due date, you may request and we may approve an extension. 

You must send us a written request to extend the due date with a justification explaining 

why you need the extension. We will notify you of our approval along with any interim 

steps that we may require.

4-240-40 How can you submit these reports? 

A. You may send hard copy reports with original signatures to us by mail.

B. You also have the alternative of submitting reports by e-mail. The forms must include 

the name and title of the authorized official who signed them and the date signed, and 

you must maintain the original signed forms in your files. 

4-240-50 What information must you submit to close out an AML grant? 

A complete closeout package for an AML grant includes the following documents. 

A. Final financial report. See Chapter 4-230 for information on how to prepare and submit a 

financial report. 

1. You must report all program income in accordance with the deduction option, 

applying program income to your expenditures to reduce Federal costs. See 

Chapter 2-210 for more information on program income. 

2. You cannot show any unliquidated obligations on your final report. You must 

pay all obligations before we can close the grant.

B. Final performance report. See Chapter 4-230 for information about your narrative 

performance report.

C. Report of Government Property, if you acquired or held property under this grant. 

Report your property inventory on the Tangible Personal Property Report (SF-428) that 

allows for any other inventory format acceptable to our awarding office. 
G-59

1. Your inventory must list all equipment or real property acquired under this grant 

or transferred into this grant from previous AML grants. You must notify us 

whether you transferred the property to the subsequent AML grant or disposed of 

the property. 

2. Normally you will hold property in an Administrative Costs subaccount, and 

report the property inventory when we close that subaccount rather than at final 

grant closeout.

D. Report of Federally-Owned Property, if any. You must list all Federally-owned property 

provided to you separately from grant-purchased property. To report use the Tangible 

Personal Property Report (SF-428) that allows for any other acceptable property list. 

You must request that the property be transferred to the subsequent grant or properly 

disposed.

E. Update the Enhanced Abandoned Mine Land Inventory System (e-AMLIS), if necessary. 

You should enter completion data on each problem area when you complete it, but you 

must ensure that all completion data under this grant has been entered in e-AMLIS before 

you send us your closeout package. You must provide a statement that you have 

completed this step.

4-240-60 How do you report and how do we close an AML subaccount?

We will use the following process to close out AML subaccounts which end before the end of 

the grant performance period.

A. You must send us the closeout documents listed above for the subaccounts which have 

ended. You must send the closeout package to our awarding office within 90 days after 

the end of the subaccount performance period. 

B. Within 60 days of receipt, our awarding office must review the package and complete all 

actions necessary to close the subaccount. We will notify you that we have completed 

the actions and send you the appropriate documents.

C. If you have any unexpended funds in the subaccount, we must process an amendment to 

deobligate the funds or transfer them to another subaccount within the same grant. See 

Chapter 4-220 for amendment processes.

D. Please refer to Chapter 4-500 for a full listing of available AML subaccounts.

4-240-70 How will we review your information and close your grant?

Our awarding office will review the closeout package and determine if it is complete and 

acceptable. If the package is not acceptable, we may return it to you with an explanation of what 

you should do to complete or correct it, or ask you for additional information, or take other 
G-60

actions to resolve the problems. After we receive an acceptable closeout package, our awarding 

office must complete the following actions within 60 days.

A. Review the closeout package and the grant.

1. Verify that we have added all known changes to the grant by appropriate 

revisions or grant amendments.

2. Resolve with you any grant suspensions, withholding of funds, disputes, and 

violations of grant clauses and assurances.

3. Write a brief evaluation of your performance under the grant and keep it in our 

official grant file.

4. Reconcile the inventory of Federally-owned property with our records and 

approve the transfer to a subsequent agreement.

5. Verify that the agreement and the file are complete. We will use a checklist to 

document this step. 

B. Process the final grant action to deobligate any unexpended funds. See Chapter 4-100 for 

information on what we will do with the deobligated funds.

C. We will send you a written notice that we consider the grant to be closed, and remind you 

of the record retention and access requirements in Chapter 2-260.
G-61

CHAPTER 4-300

TITLE IV GRANT PROCEDURES FOR CERTIFIED PROGRAMS

4-300-00 What does this chapter do?

4-300-10 What types of Abandoned Mine Land (AML) funds may you get and how may you 

use them?

4-300-20 What grant policies apply to your program?

4-300-30 How do you apply for a Title IV grant?

4-300-40 How will we process your grant award?

4-300-50 How do you meet environmental compliance requirements?

4-300-60 How will we process grant amendments?

4-300-70 What reports must you send us?

4-300-80 What closeout information will you send us and how will we close your grant?

4-300-00 What does this chapter do?

This chapter explains the procedures used by us, the Office of Surface Mining Reclamation and 

Enforcement (OSMRE), for grants to certified states and tribes under Title IV of the Surface 

Mining Control and Reclamation Act (SMCRA). These procedures apply to your reclamation 

program if you have certified that you have achieved all the priorities in section 403(a) of 

SMCRA for coal reclamation on eligible lands and waters in your jurisdiction. Because the 

SMCRA Amendments of 2006 gave you wide authority over your activities and expenditures, 

we created separate grant procedures to reflect our limited role after coal reclamation is 

completed.

4-300-10 What types of Abandoned Mine Land (AML) funds may you get and how may you 

use them?

Please refer to Chapter 4-500 for a full listing of available AML fund types.

4-300-20 What grant policies apply to your program?

A. You must use funds for activities authorized in SMCRA and described in your approved 

reclamation plan or your grant application.

B. You must comply with all applicable Federal laws and regulations. This includes 

Department of Interior, Office of Management and Budget (OMB) and Treasury 

regulations, including the Uniform Administrative Requirements, Cost Principles, and 

Audit Requirements for Federal Awards, at 2 CFR Part 200 Subpart D. 

C. You must comply with the provisions of 2 CFR 1402, Financial Assistance Interior 

Regulation , Supplementing the Uniform Administrative Requirements, Cost Principles 

and Audit Requirements for Federal Awards. 

4-300-30 How do you apply for a Title IV grant?
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A. You may mail or e-mail your application to the appropriate OSMRE awarding office.

B. You may apply at any time for a grant of any or all of the program funds that are 

available to you. 

C. Your application must include the following items.

1. SF-424 cover page signed by an authorized official.

2. A budget breakout showing the requested funding by OSMRE subaccount 

categories. Please refer to Chapter 4-500 for a full listing of available AML 

subaccounts.

3. A program narrative statement very briefly describing the planned activities. The 

application is not required to include information on individual projects or 

activities. The narrative must include a statement that activities to be supported 

with Prior Balance Replacement Funds are for purposes established by the state 

legislature or tribal governing body. The narrative must discuss how priority was 

given to addressing the impacts of minerals development for these activities.

4. SF-424D, Assurances for Construction Programs.

5. Certifications form showing compliance with Debarment and Suspension, DrugFree Workplace, and Lobbying statutes. 

6. If applicable, Disclosure of Lobbying Activities form SF LLL.

D. The application must provide the information we need to award the grant. If the 

application is not complete, we will inform you as soon as practicable of the additional 

information we need to process the award.

4-300-40 How will we process your grant award?

A. We will award the grant as soon as practicable, but no more than 30 days after receipt of 

a complete application. We will complete the following actions. 

1. Determine that the application is complete.

2. Confirm that the amount of funds requested is available.

3. Check the System for Award Management (SAM) to confirm that your 

organization or its officials are not debarred, suspended, or ineligible for Federal 

assistance.
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4. Confirm that you are in compliance with OMB’s single audit requirements.

5. Assess your risk to receive grant funds.

6. Announce the award to Congress and the public using the notification procedures 

established by OSM’s Office of Communication.

7. Approve the award through our electronic grants system.

8. Send the approved award to you. 

9. Document the award in an official grant file. The file must include your 

application and all other materials you sent us, all our findings and 

determinations, and all other information needed to understand the application 

and award process.

B. The award will cover the performance period you requested in your application. If any 

subaccounts have different performance periods than the grant period, the performance 

periods must be specified in the application or the award.

C. The award we approve obligates the Federal funds. You accept the award and its 

conditions when you start work under the agreement or when you first draw down the 

funds.

4-300-50 How do you meet environmental compliance requirements?

A. When you conduct a coal reclamation project to comply with certification requirements 

under 30 CFR 875.14(b), you must implement the environmental compliance procedures 

found in OSMRE REG-1, Handbook on Procedures for Implementing the National 

Environmental Policy Act (NEPA Handbook) (Revised 2019). You must not expend any 

funds on a coal reclamation project until we have ensured that all necessary actions have 

been taken to comply with the National Environmental Policy Act of 1969 (NEPA) (42 

U.S.C. 4321 et seq.) and any other applicable laws, clearances, permits or requirements, 

and we issue an Authorization to Proceed (ATP). 

1. A complete ATP request must confirm that you have entered the problem area 

information into the Enhanced Abandoned Mine Land Inventory System (eAMLIS) in compliance with directive AML-1. 

2. The ATP request must also include the appropriate NEPA compliance 

information. See the NEPA Handbook for a detailed description of the 

information and documentation.

3. Although NEPA documentation is part of the criteria required for an ATP request, 

the NEPA process and the ATP process are two separate processes. An ATP 
G-64

request cannot be completed until OSMRE has issued a Record of Decision 

(ROD), Finding of No Significant Impact (FONSI), or Categorical Exclusion 

(CE) with the NEPA documentation. The ATP approval letter will reference the 

date that OSMRE signed the ROD, FONSI, or CE (see Chapter 4-170 for 

information on the ATP process).

B. You are responsible to ensure that all applicable laws, clearances, permits, or 

requirements are met before you expend Title IV funds.

C. Projects or activities other than coal reclamation under 30 CFR Part 874 may not require 

an ATP from us. The NEPA requirements in the NEPA Handbook may apply to those 

projects or activities where we are not required to issue an ATP. Therefore, please 

consult with OSMRE’s NEPA staff to determine specific requirements. 

4-300-60 How will we process grant amendments?

A. When you wish to make changes in an assistance agreement, you must follow the 

requirements in the 2 CFR Part 200. 

B. We will not approve a request for a change to a grant, including a time extension, if we 

receive the request after the end of the performance period unless there are unforeseen 

circumstances not under your direct control. You must justify these extenuating 

circumstances to the satisfaction of the authorized official in our awarding office.

C. We must approve the following changes to a grant agreement with a formal grant 

amendment.

1. Add more funds to the agreement.

2. Deobligate funds before the end of the grant performance period.

3. Make the grant performance period longer or shorter.

4. Transfer funds from one subaccount to another.

5. Add a new subaccount.

D. You may enter an amendment application using an approved electronic grant system. 

Alternatively, you may send an e-mail or paper application which must include a signed 

Form SF-424 cover page and a brief explanation of the requested change. If the 

amendment will revise the budget, you must also include a revised breakout of the grant 

budget by subaccount. 

E. We will award the amended grant agreement within 20 days of receiving an amendment 

application. We will process amendments in accordance with the provisions for 
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awarding new agreements in section 4-300-40 above, except that we will only announce 

the amendment through the Office of Communications if the amendment provides 

additional funding of more than $100,000.

4-300-70 What reports must you send us?

A. You must provide performance and financial reports to OSMRE annually. Reports are 

due 90 days after the end of each 12-month period of the grant performance period, 

starting on the effective date of the grant. Alternatively, you may provide reports on 

another annual cycle mutually acceptable to you and us.

1. You may file the financial report through an electronic grant system or on an SF 

425 and 425A reporting form. Alternatively, information may be provided in 

another format mutually acceptable to you and us. An alternative format must 

include the grant number, the report period, cumulative expenditures for each 

subaccount, cumulative indirect costs and program income if any, and a dated 

signature or approval by an authorized official of the State or Tribe. 

2. The narrative performance report may be filed electronically or on paper in any 

format. The report must describe your accomplishments under the grant during 

this reporting period. 

B. When an OSMRE office receives grant financial and performance reports, it must review 

the reports and document that the reports comply with all requirements. We will prepare 

a monitoring statement to document our review.

C. You must annually update Enhanced Abandoned Mine Land Inventory System (eAMLIS) for each reclamation project as it is completed. If you add any coal problems to 

e-AMLIS in a new or existing problem area, we must approve the amendment to the 

inventory before you expend Title IV funds.

4-300-80 What closeout information will you send us and how will we close your grant?

A. Upon completion of each grant, you must send us a final financial report and a final 

performance report. You must make every reasonable effort to send the reports no later 

than 90 calendar days after the end of the grant. We may extend the due date for the final 

reports at your request. 

B. The receiving OSMRE office must perform the following actions to close out the grant.

1. Review the closeout information you provided.

2. Deobligate any unexpended grant funds.
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C. All Title IV grant funds are available until expended. If we deobligate any unexpended 

funds when we close out your grant, the funds will be available for re-award to you. You 

may apply for unused funds whenever you choose, either in a new grant or as an 

amendment to an existing open grant.
G-67

CHAPTER 4-400

PROCEDURES FOR CIVIL PENALTY GRANTS

4-400-00 What does this chapter do?

4-400-10 What types of funds may you get and how may you use them?

4-400-20 What grant policies apply to your program?

4-400-30 How do you apply for a Civil Penalty Grant?

4-400-40 How will we process your grant award?

4-400-50 How do you meet environmental compliance requirements?

4-400-60 How will we process grant amendments?

4-400-70 What reports must you send us?

4-400-80 What closeout information will you send us and how will we close your 

agreement?

4-400-00 What does this chapter do?

This chapter explains the procedures we, the Office of Surface Mining, Reclamation, and 

Enforcement (OSMRE) use for grants for civil penalty reclamation under Title IV of the Surface 

Mining Control and Reclamation Act (SMCRA). These procedures apply to your program if we 

have provided funding for a civil penalty project in your state or tribe as defined in section 

402(g) of SMCRA for coal reclamation on eligible lands and waters in your jurisdiction. We 

created separate procedures to reflect the unique characteristics of civil penalty collections and 

funding.

4-400-10 What types of funds may you get and how may you use them?

If you have a qualifying project under Section 402(g)(4) of SMCRA, you may submit a request 

for funds to us. It is our discretion to provide you with funding based on amounts collected from 

the assessment of civil penalties under Section 518 of SMCRA.

4-400-20 What grant policies apply to your program?

A. You must use funds for activities authorized in SMCRA and described in your approved 

reclamation plan or your grant application.

B. You must comply with all applicable federal laws and regulations. This includes OMB 

and Treasury regulations such as the Uniform Administrative Requirements, Cost 

Principles, and Audit Requirements for Federal Awards, found at 2 CFR Part 200. 

C. Some cost items in OMB’s Cost Principles require the prior approval of the awarding 

agency in order to be allowable costs, including equipment and capital expenditure costs. 

4-400-30 How do you apply for a Civil Penalty Grant?

A. You may mail or e-mail your application to the appropriate OSMRE awarding office.
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B. You may apply at any time for a grant of any or all of the program funds that are 

available to you. 

C. Your application must include the following items.

1. SF-424 cover page signed by an authorized official.

2. A budget narrative explaining and justifying the requested budget. 

3. A program narrative statement must explain the proposed project. You may use 

the optional OSMRE 51 form or plain paper.

a. Explain the need for the project.

b. Provide a summary of the project. Who will be responsible for the 

contract and oversight?

c. What are the purpose, goals and objectives of the project? 

d. Do you have the legal right of entry to the property for construction and

continuing monitoring and maintenance? Provide a copy of the

authorizing document.

4. SF-424D, Assurances for Construction Programs.

5. If applicable, Disclosure of Lobbying Activities form SF LLL.

D. The application must provide the information that we need to award the grant. If the 

application is not complete, we will inform you as soon as practicable of the additional 

information needed to process the award and work with you to obtain the required 

documents.

4-400-40 How will we process your grant award?

A. We will award your grant as soon as funding becomes available. We will complete the 

following actions: 

1. Determine that the application is complete.

2. Confirm that the amount of funds requested is available.

3. Check the System for Award Management to confirm that your organization or its 

officials are not debarred, suspended, or excluded for purposes of receiving 

funding.
G-69

4. Confirm that you are in compliance with OMB’s single audit requirements.

5. Assess your risk to receive grant funds. 

6. Before the planned award, we will send information about the award to our Office 

of Communications for Congressional and public news release. Our awarding 

office must follow the notification procedure established by the Office of 

Communications.

7. Approve the award through our electronic grants system.

8. Send the approved award to you.

9. Document the award in an official grant file. The file must include your

application and all other materials you sent us, all our findings and 

determinations, and all other information needed to understand the application 

and award process.

B. The award will cover the performance period you requested in your application. 

C. The award we approve obligates the federal funds. You accept the award and its 

conditions when you start work under the agreement or when you first draw down the 

funds.

4-400-50 How do you meet environmental compliance requirements?

A. When you conduct a coal reclamation project using civil penalty funds, you must comply 

with the requirements in OSMRE REG-1, Handbook on Procedures for Implementing the 

National Environmental Policy Act (NEPA Handbook) (Revised 2019). Once the NEPA 

process is completed, you must request an Authorization to Proceed (ATP) from us. You 

must not expend any funds on a coal reclamation project until we have ensured that all 

necessary actions have been taken to comply with the National Environmental Policy Act 

of 1969 (NEPA) (42 U.S.C. 4321 et seq.) and any other applicable laws, clearances, 

permits or requirements, and we issue the ATP.

 

1. Although NEPA documentation is part of the criteria required for an ATP request, 

the NEPA process and the ATP process are two separate processes. An ATP 

request cannot be completed until OSMRE has issued a Record of Decision 

(ROD), Finding of No Significant Impact (FONSI), or Categorical Exclusion 

(CE) with the NEPA documentation. The ATP approval letter will reference the 

date that OSMRE signed the ROD, FONSI, or CE (see Chapter 4-170 for 

information on the ATP process).
G-70

B. You are responsible to ensure that all applicable laws, clearances, permits, or 

requirements are met before you expend Civil Penalty funds.

C. Projects or activities other than coal reclamation under 30 CFR Part 874 may not require 

an ATP from us. The NEPA requirements in the NEPA Handbook may apply to those 

projects or activities. Therefore, please consult with OSMRE’s NEPA staff to determine 

specific requirements. 

4-400-60 How will we process grant amendments?

A. When you wish to make changes in an assistance agreement, you must follow the 

requirements in 2 CFR Part 200 Subpart D. 

B. We will not approve a request for a change to a grant, including a time extension or 

funding increase which we receive after the scheduled end of the performance period 

unless there are unforeseen circumstances not under your direct control. You must justify 

these extenuating circumstances to the satisfaction of the authorized official in the 

awarding OSMRE office.

C. We must approve the following changes to a grant agreement with a formal amendment.

1. Add more funds to the agreement.

2. Deobligate funds.

3. Make the grant performance period longer or shorter.

D. Either you or we may initiate a grant amendment. However, we must both agree on the 

amendment terms. You must submit an amendment application via email or mail a paper 

application. The amendment application must include the following:

1. Signed or approved Form SF 424, identifying the type of change you are 

requesting in item 8.

2. A narrative explanation and justification for the requested change. You may use 

the optional OSMRE 51 form, or your transmittal letter or any other format.

3. If your request will change the budget or the subaccounts, provide revised budget 

information. You may use the optional OSMRE 49 form or any alternative format 

showing the proposed subaccounts and amounts.

E. We will approve or disapprove your amendment application within 30 days of receiving 

it. We will process amendments in accordance with the provisions for awarding new 

agreements in section 4-400-40 above, except that notification of the Office of 
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Communications is required only if the amendment provides additional funding of more 

than $100,000. We will send you notification that the amendment has been approved.

4-400-70 What reports must you send us?

A. You must provide periodic performance and financial reports to OSMRE. The awarding 

office will define reporting frequency, but it will be no more frequent than quarterly. 

Reports are due 30 days after the end of each defined reporting period starting at the end 

of the on the first calendar quarter after the effective date of the grant. 

1. You must submit your financial report on an SF 425 reporting form. 

2. The narrative performance report may be filed electronically or on paper in any 

format. The report must describe your accomplishments under the grant during 

this reporting period. 

B. We will review your programmatic and financial reports. We will verify and determine if 

you have complied with the reporting requirements and provided all the information we 

need. The following list is a minimum review:

1. An official authorized to act for your organization must sign or approve the 

reports. Reports received by e-mail must include the name and title of the 

authorized official who signed the original forms, and the date signed.

2. We must receive reports by the due dates.

3. All reported activities and claimed costs must be in compliance with the approved 

State plan and Federal regulations.

4. Programmatic reports must compare the planned and actual accomplishments of 

AML program activities.

5. Financial reports must be mathematically accurate and is consistent with our 

drawdown records.

6. All claimed costs must be supported by your accounting records and you must be 

able to reconcile them.

C. If any concerns are identified, our awarding office will work with you to correct the 

report.

D. We will prepare a monitoring statement to document our review. 

4-400-80 What closeout information will you send us and how will we close your 
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agreement?

A. Upon completion of each agreement, you must send us a final financial report (SF-425) 

and a final performance report. You must make every reasonable effort to send the 

reports no later than 90 calendar days after the end of the grant. We may extend the due 

date for the final reports at your request. You however must provide justification for the 

need to extend this date. 

B. The receiving OSMRE office must perform the following actions to close out the 

agreement: 

1. Review the closeout information you provided.

2. Verify that we have added all known changes to the grant by appropriate 

revisions or grant amendments.

3 Resolve with you any grant suspensions, withholding of funds, disputes, and 

violations of grant clauses and assurances.

4. Write a brief evaluation of your performance under the grant and keep it in our 

official grant file.

5. Reconcile the inventory of Federally-owned property to our records, and approve 

the transfer to a subsequent agreement.

6. Verify that the agreement and the file are complete. We will use the Grant and 

Cooperative Agreement Closeout Checklist or an approved alternative form to 

document this step. 

C. Process the final grant action to deobligate any unexpended funds. See Chapter 4-100 for 

information on what we will do with the deobligated funds.

D. We will send you a written notice that we consider the grant to be closed, and remind you 

of the record retention and access requirements in Chapter 2-260.

E. All civil penalty funds are available until expended or the performance period has ended, 

whichever occurs first. You may submit subsequent requests for funding if we authorize 

additional funding and apply for either a new agreement or as an amendment to an 

existing open agreement.
G-73

CHAPTER 4-500

SUBACCOUNTS AND FUND TYPES

4-500-00 What does this chapter do?

4-500-10 What are the available subaccounts and fund types?

4-500-20 What do the fund type abbreviations stand for?

4-500-30 What do the subaccount numbers stand for?

4-500-00 What does this chapter do?

This chapter details all the subaccounts (i.e. cost categories) and fund types that are available 

under the Abandoned Mine Land (AML) and AML Economic Revitalization (AMLER) (also 

known as the AML Pilot) Programs.

4-500-10 What are the available subaccounts and fund types?

AML Fund and U. S. Treasury Fund Subaccounts

AML Fund U.S. Treasury Funds

Subaccount Federal 

Expense

Historic 

Coal

State/Tribal 

Share

Prior Balance 

Funds 

Certified 

States/Tribes

Prior Balance 

Funds 

Uncertified 

States

FAST 

Act 

Funds*

Certified 

in Lieu AMLER

01 FE HC SS HS HU H1 H2 ED

03 FE HC SS HS HU H1 H2 ED

04 HC SS HS HU H1 H2 ED

05 EFE

07 FE** HC SS

08 HC SS HS HU H1 H2

09 FE HC SS HS HU H1 H2

11 HC SS HS H1 H2

16 HS H1

17 H2

18 ED

19 FE HC SS HS HU H1 H2 ED

20 HC SS HS H1 H2

*Only Wyoming is eligible to use Fixing America’s Surface Transportation Act (FAST) Act funds

**Only Maryland may use FE funds for this subaccount

4-500-20 What do the fund type abbreviations stand for?

FE Federal Expense (Minimum Program Make up funds) as authorized in 402(g)(8) of 

SMCRA and 30 CFR Part 872.

Source: AML Fund

HC Historic Coal funds as authorized in Section 402(g)(5) of SMCRA and 30 CFR Part 872.

Source: AML Fund
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SS State and Tribal Share as authorized in section 402(g) of the Surface Mining Control and 

Reclamation Act of 1977, as amended (SMCRA) and 30 Code of Federal Regulations 

(CFR) Part 872, Moneys Available to Eligible States and Indian Tribes.

Source: AML Fund

HS Prior Balance Replacement Funds for certified states and tribes as authorized in Section 

411(h)(1) of SMCRA for the purposes in section 403 of SMCRA and 30 CFR Part 872.

Source: U.S. Treasury Funds

HU Prior Balance Replacement Funds for uncertified states as authorized in section 411(h)(1) 

of SMCRA for the purposes in Section 403 of SMCRA 30 CFR Part 872.

Source: U.S. Treasury Funds

H1 Fixing America’s Surface Transportation Act (FAST Act) as authorized in Public Law 

(PL) 114-94.

Source: U.S. Treasury Funds

H2 Certified in Lieu funds for certified states as authorized in 411(h)(2) of SMCRA and 

defined in 30 CFR Part 872.

Source: U.S. Treasury Funds

ED AML Economic Revitalization (AMLER) Program as authorized by appropriation in 

Public Laws: 114-113, 115-31, 115-141, 116-6, and 116-94.

Source: U.S. Treasury Funds

EFE Emergency Federal Expense funds (subject to availability of funds) as authorized in 

Section 410 of SMCRA and 30 CFR Part 872.

Source: AML Fund

4-500-30 What do the subaccount numbers stand for?

01 Non-Emergency Administrative

These are costs that cannot be allocated to individual reclamation projects, such as 

program policy, inventory management, program management, and program support. 

Engineering and project design costs should not be incorporated into subaccount 01.

03 Coal Project Costs (Non Water Supply)

Used for actual construction, realty work, construction contracting, construction 

inspection, and other items allocable to a specific project in accordance with SMCRA, 30 

CFR Parts 870-886. Please note that project design and engineering coal-related costs 

should no longer be included under subaccount 03. A new engineering and design 

subaccount 19, as described below, have been created to track these coal-related costs.

04 Water Supply Project Costs
G-75

Authorized by Section 403(b) of SMCRA, states/tribes may expend funds to protect, 

repair, replace, construct, or enhance facilities related to water supplies adversely affected 

by coal mining practices. Please note that project design and engineering coal-related 

costs should no longer be included under subaccount 04. A new engineering and design 

subaccount 19, as described below, has been created to track these coal-related costs.

05 Emergency Project Costs

Authorized by section 410 of SMCRA. Emergency project costs to cover the emergency 

restoration, reclamation, abatement, control, or prevention of adverse effects of coal 

mining practices, on eligible lands. Emergency projects must be pre-authorized by 

OSMRE and directly related to AML emergency hazard abatement. Subject to 

availability of funds. 

07 Acid Mine Drainage Set-Aside (Uncertified)

Authorized by Section 402(g)(6) of SMCRA, uncertified states may keep and deposit up 

to 30% of their State and Historic Coal Share in an interest-bearing account. Amounts 

deposited into this account must be used for acid mine drainage abatement and treatment. 

(Please note that special conditions apply to the State of Maryland as authorized by the 

Omnibus Appropriations Act of 2009, Public Law 111-8).

08 Subsidence Insurance

Authorized by Section 403(b) of SMCRA, states may expend State Share funds to 

develop, administer and operate a subsidence insurance program to insure private 

property against damage caused by subsidence from underground coal mining.

09 Non-emergency Indirect Costs

Non-emergency indirect costs (facilities and administrative F&A) are costs incurred by 

an organization for a common or joint purpose benefiting more than one cost objective or 

program and not readily assignable to the cost objectives specifically benefited. Please 

note: This subaccount describes a separate indirect costs subaccount, however, OSMRE 

recommends including indirect costs within the related direct cost subaccounts (in 

accordance with state/tribal cost allocation plan or indirect cost rate agreement) rather 

than setting up separate subaccounts. This may reduce the need for subsequent grant 

amendments moving money between subaccounts.

11 Non-coal Reclamation Projects

Authorized by Section 409 of SMCRA, eligible states/tribes may reclaim eligible noncoal problems. Please note that any project design and engineering non-coal related 

reclamation costs should not be included under subaccount 11. A new engineering and 

design subaccount 20, as described below, has been created to track these non-coal 

related reclamation costs.

16 Prior Balance Non-Reclamation Activity (Prior Balance – Certified)

Authorized by Section 411(h)(1) of SMCRA, certified states/tribes may use funds for 

approved activities authorized by their legislative organization, and that addresses the 
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impacts of mineral development. In addition, certified states/tribes may use funds for 

non-reclamation activity, but with funding priority given to any remaining coal projects.

16 FAST Act Non-Reclamation Activity (Certified) (Introduced in 2016)

Authorized by the FAST Act, Public Law 114-94, certified states/tribes may use funds 

for approved activities authorized by their legislative organization, and that addresses the 

impacts of mineral development. In addition, certified states/tribes may use funds for 

non-reclamation activity, but with funding priority given to any remaining coal projects 

after certification. Only Wyoming is eligible to use FAST Act funds.

17 Non-Reclamation Activity (Certified In-Lieu – Certified)

Authorized by Section 411(h)(2) of SMCRA, certified states/tribes may use funds for 

non-reclamation activity, but with funding priority given to any remaining coal projects 

after certification.

18 Economic Development Related Activity (Introduced in 2019)

Economic development costs for projects under the Abandoned Mine Land Economic 

Revitalization (AMLER) Program.

19 Coal Projects Engineering & Design Costs (Introduced in 2019)

Coal-related engineering and design costs associated with site investigation including 

identification and mapping of hazards, environmental sample collection and data 

validation; costs associated with surveying design and engineering of reclamation 

activities including development of construction bid packages; costs associated with 

owner operator searches, eligibility determination, historic and archeological surveys, 

threatened and endangered species reports and consultation, document preparation related 

to NEPA, public meetings, and landowner agreements; and any other costs associated 

with project preparation prior to the award or initiation of a construction project. (Please 

note that this definition does not include construction oversight or long-term monitoring 

or maintenance. Any cost related construction oversight or long-term monitoring or 

maintenance should be included under direct project subaccounts such as 03 and 04).

20 Non-Coal Projects Engineering & Design Costs (Introduced in 2019)

Non-Coal related engineering and design costs associated with site investigation 

including identification and mapping of hazards, environmental sample collection and 

data validation; costs associated with surveying design and engineering of reclamation 

activities including development of construction bid packages; costs associated with 

owner operator searches, eligibility determination, historic and archeological surveys, 

threatened and endangered species reports and consultation, document preparation related 

to NEPA, public meetings, and landowner agreements; and any other costs associated 

with project preparation prior to the award or initiation of a construction project. (Please 

note that this definition does not include construction oversight or long-term monitoring 

or maintenance. Any cost related to construction oversight or long-term monitoring or 

maintenance should be included under direct project subaccounts such as 03 and 04).
H-1

Annex H: FAM Part 5 - Regulatory Grant Program

CHAPTER 5-100

REGULATORY PROGRAMS OVERVIEW

5-100-00 What is the purpose of this chapter?

5-100-10 Where does this information come from?

5-100-20 What are OSMRE’s regulatory financial assistance programs?

5-100-30 What budget estimates of your regulatory funding needs must you send us?

5-100-40 How will we distribute annual regulatory grant funding?

5-100-50 Can you use regulatory funds to cover certain bond forfeiture costs?

5-100-00 What is the purpose of this chapter?

This chapter provides a general overview of financial assistance programs in our coal regulatory 

program. The instructions in this chapter apply to all regulatory assistance programs and 

agreements awarded by us, the Office of Surface Mining Reclamation and Enforcement 

(OSMRE), to you, a state or tribe with active coal mining. 

5-100-10 Where does this information come from?

Title V of the Surface Mining Control and Reclamation Act of 1977 (SMCRA), P.L. 95-87, 

authorizes us to fund state, tribal and Federal programs to control the environmental impacts of 

surface coal mining. It authorizes states and tribes to develop and assume regulatory primacy, 

act as the regulatory authority, and operate their coal regulatory program. Our regulations at 30 

CFR Chapter VII implement SMCRA.

5-100-20 What are OSMRE’s regulatory financial assistance programs?

We provide financial assistance under the following programs to states and tribes to implement 

the coal regulatory provisions of Title V.

A. Interim grants to fund the initial regulatory program.

B. Program development grants to assist states and tribes to develop a permanent program.

C. Administration and Enforcement (A&E) grants to states and tribes to operate an approved 

permanent regulatory program. See Chapter 5-110 for more information.

D. Federal lands cooperative agreements to States which elect to administer their approved 

regulatory program on Federal lands. See Chapter 5-120 for more information.

E. Small Operator Assistance Program (SOAP) operational grants to states to assist small 

coal mine operators to meet their permit requirements. See Chapter 5-130 for more 

information.
H-2

5-100-30 What budget estimates of your regulatory funding needs must you send us?

A. Eighteen months before the beginning of each Federal fiscal year (FY), you must send us 

your estimated program budget with the regulatory funding you will request for that FY. 

You must break out the program budget by the categories listed below. We will review 

your estimates and use this information in preparing our Federal budget request.

 

1. Show functional categories: permitting, inspection and enforcement, SOAP 

administration, lands unsuitable and other administrative costs.

2. Show object class categories: personnel and fringe benefits, travel, equipment, 

supplies, contractual, other and indirect costs.

3. If applicable, show the estimated costs of Federal lands and SOAP operations. 

B. Three months before the beginning of the FY, you must send us an updated estimate of 

your regulatory funding needs, using the same format as the eighteen-month estimates. 

5-100-40 How will we distribute annual regulatory grant funding?

A. If we have enough regulatory funds available, we will distribute to each state and tribe 

the amount you requested or the amount recommended by our awarding office. The 

distribution process designates funds for a particular state or tribe, but does not actually 

award or provide any funds.

B. If we do not have enough funds available to fund the total regulatory needs of all states 

and tribes, we will distribute the available funds among the states and tribes as equitably 

as possible.

C. When we distribute a specific amount of funds to you, it does not commit us to award 

you a grant for that amount. You must still apply for your grant, and we will approve or 

disapprove it based on your application and program. See Chapter 5-200 for more 

information on your application and Chapter 5-210 on our review and award processing.

D. When Congress appropriates regulatory grant funds, they specify whether we may 

obligate the funds during a period of one fiscal year or two fiscal years. In either event, 

we normally award regulatory grants for a twelve month period using the current fiscal 

year’s annual appropriation. 

5-100-50 Can you use regulatory funds to cover certain bond forfeiture costs?

This section explains which reclamation activities associated with bond forfeiture sites are 

allowable costs under the regulatory program grant. You must fund activities which are not 

allowable under the grant with the proceeds of the forfeited bond or other State resources.
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A. Sites forfeited under the permanent program.

1. You may fund administrative costs not directly associated with site-specific 

reclamation from your regulatory grant if the costs are part of the forfeiture 

process or if the activities would have been performed had there been no 

forfeiture. Allowable costs may include site inventories, site priority ranking 

activities, forfeiture processing, site inspections, and contract monitoring to the 

extent that it does not exceed the level of effort that would have been expended 

had there been no forfeiture.

2. You cannot use grant funds for costs associated with site-specific activities 

directly related to completion of the reclamation plan. Unallowable costs include 

redesign of a reclamation plan after forfeiture and the reclamation work itself. 

You must fund these costs from the proceeds of forfeited bonds or with other state 

resources.

B. Sites forfeited under the Initial Program

1. SMCRA’s Initial Regulatory Program did not require reclamation bonds. 

However, section 505(b) of SMCRA did not prevent a state from imposing 

bonding requirements for initial program sites as a more stringent environmental 

control. Therefore, administrative costs related to bond forfeiture on initial 

program sites may be an allowable program cost if an approved regulatory 

program contains bonding provisions.

2. Administrative costs associated with “bid preparation” are considered to be 

allowable program costs, to the extent that they do not include the costs of 

designing or redesigning the approved reclamation plan. 

a. Eligible costs include those related to bid specification preparation, such 

as planimeter work and office calculations needed to determine areas and 

volumes. Reclamation costs are allowable to the extent that they would 

normally be incurred regardless of the quality of the original reclamation 

plan. Such costs include site visits and limited surveys to obtain data 

necessary for the preparation of bid specifications, including those 

conducted to determine drainage control needs, backfilling and grading 

volumes or the size of areas in need of seeding or soil amendments.

b. Ineligible costs include those related to the preparation of new maps, plans 

or drawings and those related to site surveys conducted for the purpose of 

horizontal or vertical control, acquisition of photogrammetric data or 

preparation of a new reclamation plan or design. The costs of the 

reclamation work itself are also ineligible.
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CHAPTER 5-110

REGULATORY ADMINISTRATION AND ENFORCEMENT GRANTS

5-110-00 What does this chapter do?

5-110-10 What is the purpose of regulatory A&E grants?

5-110-20 Who is eligible for an A&E grant?

5-110-30 What are the non-Federal funding requirements for A&E grants?

5-110-40 What costs are allowable under your A&E grant?

5-110-50 What costs are unallowable under an A&E grant?

5-110-60 What is the performance period for an A&E grant?

5-110-00 What does this chapter do?

This chapter explains our requirements for regulatory Administration and Enforcement (A&E) 

grants awarded to your state or tribal coal regulatory program by us, the Office of Surface 

Mining Reclamation and Enforcement (OSMRE).

5-110-10 What is the purpose of regulatory A&E grants?

We award regulatory A&E grants to support your regulatory program approved under Section 

503 of the Surface Mining Control and Reclamation Act (SMCRA).

5-110-20 Who is eligible for an A&E grant?

To be eligible for an A&E grant, your state or tribe must meet both of the following 

requirements.

A. You must have an approved program to regulate surface coal mining.

B. You must have a single agency designated in writing by the governor or head of the tribal 

governing body to receive and administer the grants.

5-110-30 What are the non-Federal funding requirements for A&E grants?

A. States must provide non-Federal funds to cover part of the costs of operating your 

program. 

1. We normally approve Federal funding for A&E grants up to 50% of the total costs for 

administering and enforcing your program. SMCRA requires 50% match for costs of 

regulatory program operations on non-Federal lands by a state which has received 

more than two years of regulatory funding. 

2. If this is your first A&E grant and we have not awarded you a program development 

grant, we may award up to 80% of the total costs for administration and enforcement 

of the program.
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3. If this is your second year of funding, we may award up to 60% of the total costs. 

4. We may reimburse you up to 100 percent of your total costs to regulate Federal lands. 

See Chapter 5-120 for policies on Federal lands funding.

B. Currently, tribes are not required to provide non-Federal funding. 

5-110-40 What costs are allowable under your A&E grant?

A. You may charge costs to your grant if they are necessary to administer and enforce your 

program and if they meet one of the following standards:

1. Costs are for activities directly identified in your approved program. 

2. Support costs are for the activities identified in your program, including such 

activities as equipment and support services.

3. Costs are to develop an amendment to your approved program.

B. Costs must be allowable according to the Office of Management and Budget’s (OMB) 

Uniform Administrative Requirements, Cost Principles, and Audit Requirements for 

Federal Awards at 2 CFR Part 200. See Chapter 3-100 for more information.

C. You may charge costs to purchase real property only if you comply with the Uniform 

Relocation Assistance and Real Property Acquisition Policies Act of 1970, as amended.

5-110-50 What costs are unallowable under an A&E grant?

A. You may not charge costs to the regulatory A&E grant which are not related to the 

administration and enforcement of the permanent coal regulatory program.

B. You may not charge costs for activities that significantly deviate from those identified in 

your approved program.

C. You may not give financial assistance to mine operators. However, you may provide 

general technical assistance.

D. You may not charge costs which are unallowable according to the OMB cost principles 

(2 CFR Part 200). 

5-110-60 What is the performance period for an A&E grant?

We normally award regulatory A&E grants for a twelve-month performance period.
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CHAPTER 5-120

FUNDING FOR STATE REGULATION ON FEDERAL LANDS

5-120-00 What does this chapter do?

5-120-10 Can states regulate mining on Federal lands within their borders?

5-120-20 How do we provide Federal lands funding?

5-120-30 What are the limits on how much Federal lands funding you can receive?

5-120-40 What are the three options you may use to calculate Federal lands costs? 

5-120-50 Can you choose not to request Federal lands funding?

5-120-60 What information on Federal lands funding must you include in your grant 

application? 

5-120-70 How will we review the Federal lands funding in your application?

5-120-80 What special requirements apply to Federal lands expenditures?

5-120-00 What does this chapter do?

This chapter explains policies and procedures for us, the Office of Surface Mining Reclamation 

and Enforcement (OSMRE) to fund states to regulate surface coal mining on Federal lands 

within their borders. These policies and procedures apply to you if your approved state coal 

regulatory program has an approved Federal lands cooperative agreement.

5-120-10 Can states regulate mining on Federal lands within their borders?

Section 523(c) of the Surface Mining Control and Reclamation Act of 1977 (SMCRA) allows 

any state with an approved regulatory program to enter into a cooperative agreement with the 

Secretary of the Interior to regulate surface coal mining and reclamation operations on Federal 

lands within the state. To approve a Federal lands cooperative agreement, the Secretary must 

determine in writing that the state has the necessary personnel and funding to fully implement 

the agreement.

5-120-20 How do we provide Federal lands funding?

We award funds to you for a Federal lands cooperative agreement as a component of your 

regulatory program Administrative & Enforcement (A&E) funding. This combines all annual 

funding in a single regulatory grant for your state.

5-120-30 What are the limits on how much Federal lands funding you can receive?

A. Section 705(c) of SMCRA limits the amount of Federal funds that we may award to you 

for Federal lands funding to the amount we estimate it would cost us if we did the 

regulatory work. 

B. Our regulations at 30 CFR 735.16(c) specify that you may not receive more money than 

your actual costs for your regulatory operations on Federal lands.
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5-120-40 What are the three options you may use to calculate Federal lands costs? 

We have established three options for you to calculate your Federal lands funding. You may 

choose which of these three options you use as the basis for the amount of Federal lands funding 

you request in your grant application. 

A. Mine Acreage Option.

1. Under this option, you use the percentage of all permitted Federal lands acres to 

all permitted acres in the state (except Indian lands) to determine the split between 

Federal and non-Federal program costs.

2. Determine the number of permitted acres of Federal land and the total number of 

permitted acres in your state. List each mine which is under permit, or for which 

a permit is anticipated, during the grant period, and the number of Federal acres 

and total acres for each mine. Calculate the total number of Federal lands acres 

and total acres in the state. You must include this list in your grant application.

3. Divide the Federal lands acres by total acres to calculate the percentage of Federal 

lands acres. You can use the percentage of Federal lands acres as the percentage 

of your total program costs which are for Federal lands operations. Apply this 

percentage to your estimate of the total cost of your program for this period to 

determine your costs for Federal lands operations. The remaining costs are your 

non-Federal lands costs. Calculate the final budget funding split by applying the 

50% match requirement to your non-Federal lands costs.

4. For example, if 30% of a state’s total permitted acreage is on Federal lands, and 

then 30% of that program’s total costs would be Federal lands costs which are 

100% Federally funded. The remaining 70% of the program costs would be for 

non-Federal lands, and would be split evenly between Federal and non-Federal 

funds. If the total program costs for this state were $1,000,000, the state would 

apply for Federal funding of $650,000 ($300,000 for Federal lands costs and 

$350,000 for 50% of the non-Federal lands costs) and show $350,000 in state 

funds for the other 50% of the non-Federal lands costs. 

B. Area-Weighted Acreage Option.

1. Under this option, the Federal lands acreage is adjusted up to reflect the additional 

requirements and higher costs states experience in working on Federal lands.

2. For each permit area, calculate the percentage of Federal lands within the total of 

all lands (non-Indian) in the permit area. Then determine the appropriate funding 

level for each permit area using the following table.
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If the Federal 

lands percent is:

Then the Federal 

lands funding 

percent is:

And the Federal 

funding percent 

(with 50% match) is:

0% 0% 50%

>0 but < 25% 25% 62.5%

>25 but < 50% 50% 75%

>50 but <75% 75% 87.5%

>75% 100% 100%

3. Multiply the Federal funding percent for each permit area by the total acreage for 

the permit to determine the Federally-funded acres in each permit area. List each 

mine which is permitted or expected to be permitted during the grant performance 

period showing the permitted Federal lands and total acres, the Federally-funded 

acres calculation for each mine, and the total Federally-funded acres. Include the 

list in your grant application.

4. Divide the total Federally-funded acres in the state by the total permitted acres to 

get the percentage of Federally-funded acres. Then apply the percentage of 

Federally-funded acres to the estimated total state regulatory program costs to 

determine the Federal lands funding. The remaining program costs, representing 

operations on non-Federal lands, must be funded with 50% Federal and 50% state 

share funds.

C. Workload Option.

1. Under this option, you calculate the Federal cost sharing percentage based on 

your detailed workload projections for the grant period. To estimate your costs, 

multiply your average costs for permitting and inspection and enforcement 

activities by the workload you anticipate during this grant period. You may also 

add any unique workload costs not included in the permitting or inspection and 

enforcement to the cost estimate. 

2. You must use your own system to determine what percent of the total projected 

workload for the grant period involves regulation on Federal lands. You must 

provide item-specific information in the analysis of your workload, and include 

data from your records and other supportable information to justify your 

calculations for the Federal lands cost and the Federal/state funding split in your 

grant application.

5-120-50 Can you choose not to request Federal lands funding?

Yes, states with approved Federal lands cooperative agreements may choose not to request 

additional funding above the fifty percent normal cost-sharing ratio for your work on nonFederal lands. If you do not request Federal lands funding, you do not have to separate costs for 
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work on Federal lands or to provide any of the additional information or calculations required 

above.

5-120-60 What information on Federal lands funding must you include in your grant 

application? 

A. You must prepare each grant application in accordance with any requirements of the 

approved cooperative agreement and in accordance with grant application procedures 

outlined in Chapter 5-200. In addition, as part of your grant application for Federal lands 

funding, you must provide the following information.

1. A detailed breakdown of the estimated total cost of implementing the regulatory 

program into Federal and non-Federal lands components. You must explain and 

document the option and calculations used.

2. If you use the acreage or area-weighted acreage options, you must provide a list 

of each mine and the actual permitted acreage of Federal and total lands.

3. If you use the workload option, you must include a detailed estimate of the 

Federal lands workload, discussed in terms of the specific permitting, inspection 

and enforcement, and administrative requirements of your state regulatory 

program and the cooperative agreement.

B. You should calculate the Federal lands funding using your preferred option. Then add it 

to the Federal share of the non-Federal lands funding (normally 50% of the cost) to 

determine your total regulatory grant request. When we review your application, we will 

determine whether the calculation is adequately documented and the proposed budget 

meets the funding limits in this section.

5-120-70 How will we review the Federal lands funding in your application?

Our awarding office must perform the following functions. 

A. Prepare state-specific data estimating what it would cost us to regulate these Federal 

lands if there were no cooperative agreement. Include permitting, inspection and 

enforcement, and administrative activities which we would conduct under a Federal 

program.

B. Review the grant application, cost estimates, and workload information you submitted. 

Compare the state costs for Federal lands regulation to the Federal cost estimate. 

C. If the cost comparison shows state costs exceeding the estimated Federal costs, we will 

provide you with our cost estimates and work with you to resolve concerns and 

differences so that we can support the cooperative agreement with Federal lands funding 

which meets the requirements in this chapter.
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5-120-80 What special requirements apply to Federal lands expenditures?

A. You must account for Federal lands costs consistently. You must use the option you 

chose in your grant application, and the resulting match percentage that we approved in 

your grant award, throughout the entire grant period to charge costs and report regulatory 

expenditures. 

B. We will not pay expenses for litigation relating to Federal lands issues. This is a 

responsibility of the Department's Office of the Solicitor.
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CHAPTER 5-130

SMALL OPERATOR ASSISTANCE PROGRAM (SOAP) GRANTS

5-130-00 What does this chapter do?

5-130-10 What is the purpose of our SOAP grant?

5-130-20 What are the limits on SOAP funding?

5-130-30 How long is the SOAP grant performance period?

5-130-40 What activities can you support with SOAP funds?

5-130-50 What limitations are placed on administrative costs?

5-130-60 What costs are unallowable with SOAP funds?

5-130-70 How long are you responsible to seek reimbursement from SOAP recipients who 

are no longer qualified for assistance?

5-130-80 How do you process reimbursed SOAP funds?

5-130-00 What does this chapter do?

This chapter explains our policies and procedures for the Small Operator Assistance Program 

(SOAP) grant awarded by us, the Office of Surface Mining Reclamation and Enforcement 

(OSMRE). A SOAP grant provides funds to you, a state or tribe with an approved permanent 

coal regulatory program to operate a program to help small coal mining operators get the 

scientific and technical information they need to apply to you for a permit to mine coal. 

5-130-10 What is the purpose of our SOAP grant?

Section 507(c) of the Surface Mining Control and Reclamation Act (SMCRA) authorizes us to 

provide SOAP funding. You use SOAP funds to contract with qualified laboratories and 

consultants to collect, analyze, and interpret hydrologic and geologic data and produce technical 

reports for the small mine operators. Surface coal mining operators whose production at all their 

locations will not exceed 300,000 tons in a continual consecutive 12 month period would be 

eligible to receive SOAP assistance. 

5-130-20 What are the limits on SOAP funding?

A. No new SOAP funds have been appropriated since FY 2005. 

B. If funds are available, the following guidelines apply to SOAP funding.

1. You may be reimbursed for up to 100% of your allowable SOAP costs. 

2. If the available funds are insufficient to fully fund the grant requests of all the states, 

we will distribute the available funds based on need or in the proportion of each 

state’s program activity to the total of all SOAP activity nationwide. 
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3. If you do not receive sufficient funds to support all the mine operator requests, you 

must develop and use a formula to allocate the reduced funds among operators as 

required by 30 CFR 795.11(b).

5-130-30 How long is the SOAP grant performance period?

A. SOAP operational grants have a three-year performance period. We selected the threeyear period to allow you to start and complete projects within the same grant.

B. You should not obligate a new project into a grant that does not have sufficient time 

remaining to complete the project.

C. We will not normally extend the three-year grant performance period.

5-130-40 What activities can you support with SOAP funds?

A. Costs must be allowable under Office of Management and Budget (OMB) regulations in 

the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for 

Federal Awards.at 2 CFR Part 200.

B. Only some of the services necessary to meet permit requirements are allowable as SOAP 

costs.

C. The following services may be allowable if the state regulatory authority (RA) requires 

them in order to apply for a permit.

1. Determination of the Probable Hydrologic Consequences (PHC) of the proposed 

operation upon the quality and quantity of surface and ground water under 

seasonal flow conditions for the proposed permit and adjacent areas, including the 

following:

a. Gathering baseline ground water and surface water information.

(1) Sample collection, field measurements and laboratory analyses.

(2) Seasonal flow and quality analyses.

(3) Inventory of ground water wells and usage and surface water usage 

in the permit and adjacent areas by contacting local, state or 

Federal agencies and a representative portion of local residents or 

property owners.

(4) Field reconnaissance of the site.

b. Well drilling for ground water baseline data on a case-by-case basis.
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c. Engineering analyses and designs necessary to determine the PHC, 

including those for sediment ponds and diversion ditches, when approved 

by our awarding office.

d. Supplemental information if PHC indicates adverse impact to hydrologic 

balance on or off the proposed site or the presence of acid-forming or 

toxic-forming material that may result in contamination of surface or 

ground water supplies.

2. Preparation of impact estimates regarding the quality and quantity of surface and 

ground water under seasonal conditions using best professional judgment as 

accepted by the RA to prepare the following findings:

a. Whether adverse impacts may occur to the hydrologic balance.

b. Whether acid-forming or toxic-forming materials are present that could 

result in the contamination of surface or ground water supplies.

c. Whether the proposed operation may result in contamination, diminution 

or interruption of an underground or surface source of water in the 

proposed permit or adjacent area that is used for domestic, agricultural, 

industrial or other legitimate purpose. If findings indicate these outcomes 

are possible, then additional information on water availability and 

alternate water sources for existing pre-mining and approved post-mining 

land uses may be collected. 

d. Impact of the proposed operation on the following:

(1) Sediment yield from the disturbed area.

(2) Acidity, total suspended and dissolved solids and other important 

water quality parameters of a local impact.

(3) Flooding or stream flow alteration.

(4) Ground water and surface water availability.

(5) Other characteristics as required by you as the RA.

3. Statement of results of test borings or core samplings for overburden geology.

a. Geologic description of permit and adjacent area, including the areal and 

structural geology and other parameters which influence reclamation, and 

the occurrence, availability, movement, quantity and quality of potentially 

impacted surface and ground waters. This information shall be based on: 

(1) Cross sections, maps and plans, as described in item c below. 

(2) Geologic literature and practices. 
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(3) Information described in items b(2) and c below and any additional 

information required by you to protect the hydrologic balance or 

meet the performance standards. 

b. Overburden drilling, sample collection and laboratory analyses from the 

permit area including either the stratum immediately below the lowest coal 

seam to be mined or any aquifer below that seam which may be adversely 

impacted by mining in order to prepare: 

(1) Logs showing lithologic characteristics including physical 

properties and thickness of each stratum, and location of ground 

water. 

(2) Chemical analyses identifying those strata that may contain acid or 

toxic-forming and alkalinity-producing materials to determine their 

content, if found necessary by the RA. 

(3) Chemical analyses of the coal seam for acid or toxic-forming 

materials including total sulfur and pyritic sulfur, if found 

necessary by the RA.

The RA may waive all or part of the sampling requirements based on the 

availability of equivalent information in a satisfactory form. 

c. Development of cross sections, maps, and plans showing

(1) Location and elevation of test borings. 

(2) Locations and elevations of monitoring stations for baseline 

ground and surface water data, fish and wildlife and, if required, 

air quality data. 

(3) Nature, depth and thickness of any coal seams to be mined, each 

stratum of the overburden, and the stratum immediately below the 

lowest coal seam to be mined. 

(4) All crop lines and strike and dip of coal to be mined within the 

permit area. 

(5) Location and extent of known workings of active, inactive or 

abandoned underground mines in the permit and adjacent area 

including mine openings to the surface. 

(6) Location and extent of subsurface water, if encountered, within 

proposed permit or adjacent area. 

(7) Location of surface water bodies such as streams, lakes, ponds, 

springs, constructed or natural drains and irrigation ditches in the 

proposed permit and adjacent areas. 

(8) Location and extent of existing or previously surface-mined areas 

within the proposed permit area. 

(9) Location and dimensions of existing areas of spoil, waste, and noncoal waste disposal, dams, embankments, other impoundments and 
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water treatment and air pollution control facilities within the 

proposed permit area. 

(10) Location and depth, if available, of gas and oil wells in the 

proposed permit area and water wells in the permit and adjacent 

area. 

These maps, plans and cross sections are developed from information 

already collected under other allowable SOAP services, information 

provided with the SOAP application, and information collected by the 

operator to meet regulatory provisions not covered by SOAP. SOAP pays 

only for the preparation of the maps and cross sections; it does not pay to 

collect this information except under other allowable SOAP services as 

discussed above. 

4. Collection of archeological and historic information and preparation of related 

plans sufficient to describe and identify the following: 

a. The nature of cultural, historic and archeological resources listed or 

eligible for listing on the National Register of Historic Places and known 

archeological sites within the proposed permit and adjacent area.

b. Important historic and archeological resources that may be eligible for 

listing in the National Register by collecting additional information, 

conducting field investigations or other appropriate analyses as required 

by the RA. 

c. Publicly owned parks or any place listed on the National Register that may 

be adversely impacted. This action may include a plan describing the 

measures to be used to prevent adverse impacts and minimize adverse 

impacts where there are valid existing rights or where joint agency 

approval is required under the coordination provisions of 30 CFR 

761.12(f). 

5. Pre-blast surveys at the written request of a resident or owner of a dwelling or 

structure located within 1/2 mile of any part of the permit area. 

6. Collection of site-specific fish and wildlife information when such information is

necessary to address the respective species or habitats, and the permit or adjacent 

area is likely to include: 

a. Listed or proposed endangered or threatened species of plants or animals 

or their critical habitats protected under the Endangered Species Act of 

1973, as amended, or similar state statutes. 
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b. Habitats of unusually high value for fish and wildlife such as important 

streams, wetlands, riparian areas, cliffs supporting raptors, areas offering 

special shelter or protection, migration routes, or reproduction or 

wintering areas. 

c. Other species or habitats identified through agency consultation as requiring 

special protection under State or Federal law. 

7. Preparation of protection and enhancement plans for fish and wildlife habitat, 

including plans to minimize disturbances and adverse impacts. Plans must 

comply with the Endangered Species Act and should include protective or 

enhancement measures used during active mining and reclamation.

8. Information and plans for any other environmental value required by the RA. 

5-130-50 What limitations are placed on administrative costs?

A. Allowable SOAP administration costs are funded in the regulatory Administration and 

Enforcement (A&E) grant, except as noted below.

B. Administrative costs (personnel, travel, supplies, notifications, and indirect costs) 

charged to the SOAP grant are strictly limited. You may only charge the costs for 

training and outreach as defined in this section. You must not exceed the maximum 

spending limits for training and outreach explained below. You must also meet each of 

the following three conditions: 

1. Costs must be necessary and reasonable to meet the objectives of SMCRA. 

2. You must specifically identify the costs in your grant application. 

3. You must document personnel costs with records of specific training, or outreach 

events. You may not charge them based on a budget estimate or proration. 

C. Training includes services that teach qualified small coal operators how to prepare permit 

applications and how to comply with the SMCRA regulatory program. 

D. Outreach includes activities to ensure that qualified small coal operators are aware of the 

assistance available to them from SOAP. 

E. Costs for training and outreach in a SOAP operational grant must be incidental to project 

costs. We limit training and outreach costs to 1% of the total estimated project costs in 

the grant application or $2,000, whichever is greater. Supplies, such as educational 

pamphlets, brochures, posters, etc., may not exceed 5% of the costs allowed for training 

and outreach. The following examples illustrate these limits.

Example 1: If you have total project costs of $500,000, your training and outreach costs 
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cannot exceed $5,000, bringing the total grant to $505,000. Supplies cannot exceed $250 

of the $5,000 total for training and outreach. 

Example 2: If you have total project costs of $100,000, training and outreach cannot 

exceed $2,000, bringing the total grant to $102,000. Supplies cannot exceed $100 of the 

$2,000 total for training and outreach. 

F. Additional technical services specified by state law or regulation and in accord with 30 

CFR 795 are allowed.

5-130-60 What costs are unallowable with SOAP funds?

Federal funds appropriated for SOAP, as mandated by the narrow statutory authorization in 

SMCRA, are linked precisely to baseline information and reports needed to satisfy hydrologic 

and geologic permitting requirements for an approval of a permit application by that state RA. 

The following costs are unallowable under the SOAP operational grant.

A. You may not charge expenses you incur to administer SOAP, except certain training, and 

outreach activities as described above. You must fund SOAP administrative costs out of 

your regulatory A&E grant.

B. You may not charge costs of exploratory test drilling, core drilling or observation well 

drilling to define the extent of coal or for sampling overburden materials.

C. You may not charge costs of collecting data from local or regional sites before you 

receive applications for assistance.

D. You may not charge Interest penalties associated with late payments for contractual work 

with laboratories.

5-130-70 How long are you responsible to seek reimbursement from SOAP recipients who 

are no longer qualified for assistance?

Operators may become ineligible for SOAP funds after you provide assistance if they 

subsequently exceed the SOAP tonnage limit for small operators. They may also become 

ineligible if they fail to apply for a permit within one year, or if they fail to mine after obtaining a 

permit. You must recover Federal funds which you spent for operators who are no longer 

qualified to receive SOAP assistance. Your liability period for recovering these funds is the term 

of the surface mining permit for which you provided assistance, or five years after you issued the 

permit, whichever is less. 

5-130-80 How do you process reimbursed SOAP funds?

Reimbursements are funds you previously expended from a SOAP operational grant which you 

recover. You must identify and collect funds previously expended for an operator if the operator 
H-18

subsequently exceeds the tonnage limit which makes them eligible for SOAP assistance. We 

define SOAP reimbursements as program income which you may spend using the addition 

option. This authorizes you to add all reimbursements you collect to the funds we awarded in an 

open SOAP grant and to expend them for the purposes of the SOAP.
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CHAPTER 5-200

THE APPLICATION PROCESS FOR A REGULATORY GRANT

5-200-00 What does this chapter do?

5-200-10 How long is a regulatory grant?

5-200-20 How do you send us your application for a regulatory grant?

5-200-30 When should you apply?

5-200-40 How can you report and account for the costs of regulatory functions?

5-200-50 What must you include in your application?

5-200-00 What does this chapter do?

This chapter explains how you, a state or tribe with an approved coal regulatory program, can 

apply to us, the Office of Surface Mining Reclamation and Enforcement (OSMRE), for a 

regulatory program Administration & Enforcement grant.

5-200-10 How long is a regulatory grant?

Your application should normally request a 12-month performance period for your regulatory 

grant.

5-200-20 How do you send us your application for a regulatory grant?

A. You must submit a complete grant application to us by one of the following methods. 

1. You may enter your application in an OSMRE-approved electronic grants portal 

or system such as Grants.gov. 

2. You may submit a complete paper application, with original signature, by regular 

mail or any other delivery method.

3. You may send your application package by e-mail. The application must include 

the name and title of the authorized official who signed it and the date signed. 

You must keep the original signed application in your files.

B. Our office must confirm that it received the application within three working days. 

5-200-30 When should you apply?

You should submit your application at least 60 days before the beginning of the grant 

performance period.

5-200-40 How can you report and account for the costs of regulatory functions?
H-20

A. Before you complete your application, you must choose how you will identify the 

regulatory functions for accounting and reporting purposes. We have identified the 

following major regulatory functions or activities:

1. Permitting includes the costs of reviewing new permit applications and modifying 

existing permits. It also includes costs of determining and approving a bond 

amount and reviewing ownership and control.

2. Inspection and Enforcement includes costs of mine inspections for compliance 

with state performance standards and of all activities to enforce compliance. It 

also includes bond release costs and legal costs related to inspection and 

enforcement activities.

3. Lands Unsuitable includes costs to evaluate and decide petitions about 

designating lands unsuitable for coal mining.

4. Regulatory program administrative activities and costs to support the above 

functions include costs for executive direction and standard administrative 

support functions, such as personnel, accounting, and procurement.

B. You must choose one of the following options to identify the costs of these functions.

1. Option 1. You must break out the functions in your reporting and accounting. 

You must break out the line item and total costs of each function in your 

application. You must support the functional costs with detailed accounting 

records. 

2. Option 2. You show only the total budget figures in your grant application 

budget. In the program narrative, you must describe the methodology you will 

use to distribute the total budgeted costs to the functions either as a percentage of 

the total or as dollar amount. This methodology must meet the requirements of 

the state comptroller or comparable organization as required by state law.

5-200-50 What must you include in your application?

The application must include the following items: 

A. Signed or approved Application for Federal Assistance, form SF 424.

B. Budget information report. You may use the optional OSMRE 47 form or provide the 

information in an alternate format of your choice.

1. Break out the budget by object class. Object classes are the budget line items, 

including personnel, fringe benefits, travel, equipment, supplies, contractual 

expenses, construction, other, and indirect costs. 
H-21

2. If you chose to account separately for regulatory functions or activities, including 

permitting, inspection and enforcement, lands unsuitable, and administrative 

costs, break out the budget for each object class and for the total grant by 

function.

3. Identify the total Federal and non-Federal funds the program will spend. Show 

the overall percentage of non-Federal support.

4. Estimate the program income that you might spend during this grant. 

5. Show the total estimated indirect costs. Show how your estimate is calculated 

using the indirect cost rate and the direct cost base which have been approved by 

your cognizant Federal agency.

C. Budget narrative. You may provide this information in any format to explain and justify 

the requested budget.

1. Personnel. List all the positions by title, with annual salary rate and percentage of 

time working on the coal regulatory program.

2. Fringe Benefits. Explain how the fringe benefits were calculated. 

3. Travel. List the types of trips and show how the estimated cost was calculated. 

4. Equipment. List each item of equipment to be purchased and justify why the 

equipment is needed for the regulatory program.

5. Supplies. Enter estimated dollar amount of supplies. List the supplies by major 

type (e.g., office supplies, training materials, research forms, postage), and show 

basis for computation.

6. Contractual. List each proposed contract, the contractor if identified, the type of 

services to be performed, the need for the services, and the estimated cost.

7. Construction. Describe any proposed construction or renovation, why it is 

necessary for the program, and the estimated cost.

8. Other. List any other cost items not reimbursed as an indirect cost, such as rent, 

utilities, or janitorial and security services, and show how the cost was calculated.

9. Indirect Costs. Include a copy of the indirect cost agreement approved by the 

cognizant Federal agency.
H-22

10. If you chose not to break out the budget by regulatory program function, such as 

permitting or inspection and enforcement, you must explain your method for 

distributing total costs to the functions. You may use a percentage, a total dollar 

figure, or some other acceptable method.

D. Program narrative. You may use the optional OSMRE 51 form or provide the 

information in any other format. These requirements come from OMB circular at 2 CFR 

Part 200. 

1. Objectives and Need for Assistance. Using your approved regulatory 

program, describe problems related to coal mining and reclamation (physical, 

economic, social, financial, or institutional) requiring a solution. Explain 

why the assistance is needed and state the primary and secondary objectives 

of the grant. 

2. Results and Benefits Expected. Identify results and benefits of the regulatory 

program. For example, explain how the program will improve life for 

coalfield citizens.

3. Approach. Outline a plan of action explaining the scope of the program and 

how the proposed work will be accomplished. Explain your reasons for 

taking this approach as opposed to others. Describe any unusual features of 

this grant. Identify the kinds of data you will collect. Discuss the criteria and 

methodology you will use to evaluate the results and success of this program.

4. Geographic Location. No information required.

E. Signed or approved Assurances for Non-Construction Projects, form SF 424B.

F. If applicable, the Disclosure of Lobbying Activities from SF LLL.
H-23

CHAPTER 5-210

APPLICATION REVIEW AND PROCESSING FOR A REGULATORY GRANT

5-210-00 What does this chapter do?

5-210-10 How long will we take to review your application and award your grant?

5-210-20 How do we review your application?

5-210-30 How do we process your grant award?

5-210-40 How do we document our review and award process?

5-210-00 What does this chapter do?

This chapter explains procedures used by us, the Office of Surface Mining Reclamation and 

Enforcement (OSMRE) to receive, review, and process your application for regulatory 

assistance. These procedures apply to all regulatory program grant and cooperative agreement 

applications.

5-210-10 How long will we take to review your application and award your grant?

We will process complete regulatory grant applications within 60 calendar days of receipt. 

5-210-20 How do we review your application?

The awarding office must take the following actions. Our review may draw upon OSMRE 

programmatic, technical, and financial staff as necessary during the review process: 

A. Determine that the application is administratively complete. See Chapter 5-200 for the 

requirements for a complete application. 

B. Confirm that the requested funds are available.

C. Make the following programmatic and financial determinations. 

1. The project objectives support your approved regulatory program.

2. The proposed activities are appropriate to accomplish the specific program 

objectives.

3. The proposed cost of the grant reflects the amount of work needed to accomplish 

the objectives. This review should consider prior costs for similar program 

expenditures by your program or similar programs. 

4. The proposed cost items and amounts are necessary and reasonable. 

a. Costs must be eligible under Office of Management and Budget (OMB) and 

OSMRE regulations.
H-24

b. Costs must be essential to accomplish program objectives.

c. Costs must be reasonable for this particular grant. Factors to consider for 

reasonableness may include fair market price and regional differences in 

cost.

d. Costs must be allocable to your regulatory program.

5. For personnel costs, determine that you have adequate human resources and 

facilities to accomplish the work under the grant.

a. Determine that the project personnel are qualified. 

b. Consider the following questions.

(1) Are the activities to be performed eligible?

(2) Are the number and type of personnel proposed necessary?

(3) Are the personnel rates reasonable?

c. The pay rates proposed for the grant personnel must be consistent with the 

rates your organization pays for similar activities not supported by Federal 

assistance. 

6. Equipment and property items must clearly demonstrate a need which cannot be 

met with property you already have.

a. Consider the following questions.

(1) How long will you need the property?

(2) Have you considered alternatives to purchasing property, such as 

rental, leasing, and sharing? 

b. You must have an adequate property management system that will ensure 

proper use and accountability for the requested property. Your system must 

be capable of producing inventory reports with equipment description, 

acquisition cost, current condition and fair market value.

7. Travel costs must be for trips which are necessary to meet the program objectives. 

8. The cost items discussed here include general questions we will consider. 

However, we may consider additional questions for a particular application or 

cost. It is important not to just look at each item as a completely separate entity, 
H-25

but rather to see how each item contributes to the successful operation of the 

program. The reviewer must use sound judgment to determine the level and type 

of analysis that is appropriate for the type of work and amount of funding being 

proposed. 

E. For state regulatory Administration & Enforcement (A&E) grants, and any other 

agreements which require that some program costs be met with non-Federal funds, we 

will confirm that you will meet the match requirement.

1. The proposed amount of non-Federal funds must meet the state’s required share 

of the proposed program cost. 

2. A responsible state official must certify that the proposed non-Federal matching 

funds are available for expenditure by your program during this performance 

period.

3. If the amount certified as available is not adequate, or if we are concerned that the 

amount certified may not be available, our awarding office will ask you for a 

specific description of the source of the proposed funds and when the funds will 

be available.

F. Check the System for award Management (SAM) to determine whether your organization 

or officials are debarred, suspended, voluntarily excluded or ineligible for Federal 

assistance.

G. Confirm that you are in compliance with the single audit requirements in 2 CFR Part 200.

5-210-30 How do we process your grant award?

A. Our awarding office will decide to approve or disapprove your application based on our 

review. If we approve the application, we will award your regulatory agreement. If we 

disapprove it, we will send you our reasons or recommendations in writing. 

B. Before the planned award, we will send information about the award to our Office of 

Communications for Congressional and public news release. Our awarding office must 

follow the notification procedure established by the Office of Communications.

C. We must enter and approve the award in our electronic grant system. Our accounting 

system will then update Treasury’s grant payment system to make the funds available for 

you to request a drawdown.

D. We will send you the approved award document, either electronically or in hard copy.

5-210-40 How do we document our review and award process?
H-26

OSMRE must document its programmatic and financial findings and recommendations. The 

following information at a minimum must be available in the official grant file kept by the 

awarding office. We must include any additional supporting information as appropriate for the 

particular application, the recipient, the regulatory program, and the awarding office:

A. Your application as we originally received it, all subsequent revisions to it, and any other 

information you sent us.

B. Records of all meetings or telephone conversations with you about the application.

C. All our correspondence with you about the application or the award.

D. All our internal reviews of the application or parts of the application. We may use a 

checklist to document application completeness. 

E. All resolutions of questions raised during the review process.

F. We must keep all records or explanations about the timing of the award process, especially 

for any time period when the awarding office could not process the grant award because

they were waiting for actions outside our control, such as your responses or availability of 

funds.
H-27

CHAPTER 5-220

AMENDMENTS AND POST-AWARD CHANGES FOR A REGULATORY GRANT

5-220-00 What does this chapter do?

5-220-10 Where do these requirements come from? 

5-220-20 When can you request changes to your grant?

5-220-30 What changes require a grant amendment?

5-220-40 What is the process for a grant amendment?

5-220-50 What changes can you request in writing that require our approval? 

5-220-60 What changes do not require our prior approval?

5-220-00 What does this chapter do?

This chapter explains the requirements to consider when you need to make programmatic or 

budget changes to your regulatory assistance agreement. It describes which changes require our 

approval, how you should request approval, and how we will process your request. This 

information applies to all regulatory program grants and cooperative agreements awarded by us, 

the Office of Surface Mining Reclamation and Enforcement (OSMRE).

5-220-10 Where do these requirements come from? 

The requirements for prior approvals for changes to assistance agreements are established in the 

Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal 

Awards, 2 CFR 200, subpart D.

5-220-20 When can you request changes to your grant?

A. If your change requires our written approval, you must request the change and receive 

our approval before you make the actual change or obligate any funds. If you incur costs 

before we approve the change, you take the risk that the cost may be unallowable.

B. We will not approve a request for a change, including time extensions or additional 

funding, which we receive after the scheduled expiration date of the assistance 

agreement. The only exception is if there are unforeseen circumstances not under your 

direct control. You must justify the extenuating circumstances to the satisfaction of our 

authorized awarding official.

C. You should send us a request to extend the performance period at least 30 days before the 

date it is scheduled to end. We will approve only one extension of the normal 

performance period for not more than one year, unless you adequately justify special or 

unusual circumstances to the authorized OSMRE official.

5-220-30 What changes require a grant amendment?

The following changes require a formal amendment to the approved agreement:
H-28

A. Extending or shortening the performance period

B. Adding more funds

C. Deobligating unneeded funds before the end of the performance period.

D. Transferring any funds between construction and non-construction if the agreement has 

both construction and non-construction activities.

5-220-40 What is the process for a grant amendment?

A. An amendment may be initiated by either you or us. However, both parties must be in 

agreement with the amendment terms.

B. You may mail or e-mail your amendment application. The amendment application must 

include the following items: 

1. Signed or approved form SF 424, indicating in item 8 the type of change you are 

requesting.

2. A program narrative explaining and justifying the requested change. You may 

use the optional OSMRE 51 form, include the explanation in your transmittal 

letter, or use another format of your choice.

3. If you are requesting a budget change, provide revised budget information. You 

may use the optional OSMRE 47 form or another format of your choice.

C. We will process amendments in the same way as new agreements (5-210). We will 

approve or disapprove your amendment request within 30 days of receiving it. We will 

notify the Office of Communications for Congressional and public announcement only 

when the amendment will increase funding by more than $100,000.

D. The amendment takes effect when approved by the authorized OSMRE official and 

applies to the entire agreement period unless otherwise stated. We will notify you when 

we have approved the amendment action in our electronic grant system and we will send 

you the appropriate documentation. 

5-220-50 What changes can you request in writing that require our approval? 

A. Some changes to the approved agreement require OSMRE prior approval, but do not 

require a formal amendment. The following changes are considered revisions to an 

approved agreement and must be requested and approved in writing: 

1. A change in the scope of the program requires our formal written approval even if 

there is no other change in the agreement or budget. A scope change is any 
H-29

change in the objectives of the program or the work to be performed that is 

outside the plans approved in the original grant and that has the potential to affect 

the success of the program. For example, contracting out permitting or inspection 

and enforcement functions would be a scope change. 

2. If OSMRE funding is over $100,000, you must request our approval before or 

when you transfer a cumulative total of more than 10% of the total budget 

between direct cost categories.

3. Office of Management and Budget (OMB) Cost Principles (2 CFR 200) say that 

some cost items are allowable only if we approve them in advance. Equipment is 

one of these cost items. If you need to incur such costs and we did not approve 

them when we approved your original application, you must request our approval. 

B. To request our approval, you must mail or e-mail a letter requesting the change to our 

awarding office as soon as you determine you need it. Your request must explain and 

justify the proposed change. If the proposal changes the budget, your request must 

identify these changes.

C. Our awarding office will notify you in writing whether or not we approve your request. 

We will send the decision letter no later than 15 days after we receive your request. If the 

request is still under consideration at the end of 15 days, the awarding office must inform 

you in writing when a decision on the request may be expected and the reasons for the 

delay.

5-220-60 What changes do not require our prior approval?

A. Principles in 2 CFR Part 200 describe the changes which require prior agency approval. 

OSMRE may not require prior approvals for any other change. 

B. Programmatic changes other than major scope changes, such as reorganizations, changes 

in office locations, or new administrative or accounting systems do not require a formal 

amendment. However, you should advise us of these changes.

C. Budget transfers that are less than 10% of the total grant amount, or for grants with less 

than $100,000 in OSMRE funds, do not require our approval. Also, if you have 

previously transferred 10% of costs with our approval, you may transfer up to an 

additional 10% of the budget without another OSMRE approval. However, you should 

document such transfers by including revised budget information with your next 

performance and financial reports.
H-30

CHAPTER 5-230

PERFORMANCE AND FINANCIAL REPORTING FOR A REGULATORY GRANT

5-230-00 What does this chapter do?

5-230-10 Where do these requirements come from?

5-230-20 When must you submit reports?

5-230-30 How can you submit your reports?

5-230-40 What information must you provide?

5-230-50 Are there any alternatives to these reporting requirements?

5-230-60 How will we review your reports?

5-230-00 What does this chapter do?

This chapter explains the reports required from you, a state or tribe that received a regulatory 

assistance agreement from us, the Office of Surface Mining Reclamation and Enforcement 

(OSMRE). It describes when your reports are due, how to submit them, and what information 

you must report. This information applies to grants and cooperative agreements awarded under 

our coal regulatory program.

5-230-10 Where do these requirements come from?

The requirements for your performance and financial reports are established in the Uniform 

Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, at 2 

CFR 200 subpart D.

5-230-20 When must you submit reports?

A. You must submit performance and financial reports to OSMRE annually. These reports 

are due 90 days after the end of the annual grant performance period. Since the 

performance period of a regulatory grant is normally twelve months, the final report is 

the only report required if you meet the 90 day due date requirement. The reporting 

period is the same as your grant’s performance period. You will find further guidance on 

regulatory grant close outs in Chapter 5-240.

B. If your performance period is longer than 12 months, or if we have extended the due date 

of your final report, you must submit interim performance and financial reports 90 days 

after the end of the first 12 months of the performance period. The interim reports must 

end on the next calendar quarter end date: March 31, June 30, September 30, or 

December 31. In addition, you must submit a final performance and financial report 90 

days after the end of the grant performance period or at the end of the extended reporting 

period. 

C. If you cannot meet a due date for a required report, contact our awarding office before the 

report is due. We may be able to extend the due date based on your justification.
H-31

5-230-30 How can you submit your reports?

A. You may submit reports by mail. A hard copy report must have an original signature by 

your authorized official. 

B. You may submit reports by e-mail. The forms must include the name and title of the 

authorized official who signed them and the date signed, and you must maintain the 

originally signed forms in your files. 

5-230-40 What information must you provide?

A. Narrative Performance Report.

1. You may use the optional OSMRE 51 form, a blank page, or any narrative format 

for your performance report. 

2. Your reports must compare actual accomplishments to the goals established for 

the period. If you did not meet your established goals, you must explain the 

reasons in your report.

3. If you can identify the output of a project or activity and can quantify it, you must 

report quantitative data and calculate unit costs.

B. Financial Report.

1. You must use the SF 425 Federal Financial Report. 

2. You must prepare your OSMRE financial reports on a cash basis.

3. You should include or attach any other appropriate information or explanation, 

such as analysis and explanation of cost overruns or high unit costs in your report.

5-230-50 Are there any alternatives to these reporting requirements?

Yes. With our prior approval, you may provide grant performance to us in an alternative format 

or timeframe. This gives you flexibility in providing grant performance data in a manner that is 

more efficient and effective while still meeting our grant performance data needs. We will be as 

flexible as possible in approving alternative reporting formats or schedules. Please contact our 

awarding office to work out an alternative reporting plan acceptable to both you and us. 

However, if we have not approved an alternative reporting plan, you must comply with the 

reporting requirements outlined above.

5-230-60 How will we review your reports?
H-32

A. We will review your programmatic and financial reports. We will determine if you have 

met the reporting requirements and provided all the information we need. We will verify 

if you have complied with the following basic requirements. 

1. An official authorized to act for your organization must have signed or approved 

the report. 

2. We must receive your report by the established due date.

3. All reported activities and claimed costs must be in compliance with your 

approved regulatory plan, your assistance application, and Federal regulations.

4. Performance reports must compare the planned and actual accomplishments of the 

regulatory program.

5. Financial reports must be mathematically accurate and consistent with our 

financial and drawdown records. 

6. All claimed costs must be supported by your accounting records and you must be 

able to reconcile them.

B. If any concerns are identified, our awarding office will work with you to correct the 

report. 

C. We will prepare a monitoring Statement to document our review.
H-33

CHAPTER 5-240

CLOSING A REGULATORY GRANT

5-240-00 What does this chapter do?

5-240-10 Where do these requirements come from?

5-240-20 When do we close out a regulatory grant?

5-240-30 When is your closeout package due?

5-240-40 How can you submit these reports?

5-240-50 What information must you submit to close out a regulatory grant?

5-240-60 How will we review your information and close your grant?

5-240-00 What does this chapter do?

This chapter describes what you, a state or tribal recipient of a regulatory assistance agreement, 

and we, the Office of Surface Mining Reclamation and Enforcement (OSMRE) must do to close 

a regulatory grant or cooperative agreement.

5-240-10 Where do these requirements come from?

The requirements for closeout procedures come from the Uniform Administrative Requirements, 

Cost Principles, and Audit Requirements for Federal Awards, at 2 CFR 200 subpart D.

5-240-20 When do we close out a regulatory grant?

A. We normally close out regulatory agreements no later than 180 calendar days after the 

end of the performance period. The first 90 days allow you to report to us. The 

remaining 90 days allow us to complete the closeout process.

B. We may close regulatory agreements without an audit. However, we may take additional 

administrative action after closeout if a subsequent audit identifies any findings or 

questioned costs.

C. We will not close an agreement until you have paid all allowable costs and we have 

deobligated all unexpended funds.

D. We will not close an agreement if it is in litigation or under appeal.

E. If we terminate an agreement, we will not close it until all termination actions have been 

completed.

5-240-30 When is your closeout package due?

A. Your complete closeout package is due to us 90 days after the end of the performance 

period of the agreement.
H-34

B. If you have made every reasonable effort to send a complete closeout package within 90 

days but cannot meet the due date, you may request and we may approve an extension. 

You must send us a written request with a justification explaining why you need the 

extension. You must submit interim performance and financial reports to us following 

the requirements in chapter 5-230. We will notify you of our approval along with any 

interim steps that we may require.

5-240-40 How can you submit these reports?

A. You may send hard copy reports with original signatures by mail.

B. Alternatively, you may submit reports by e-mail. The forms must include the name and 

title of the authorized official who signed them and the date signed, and you must 

maintain the original signed forms in your files. 

5-240-50 What information must you submit to close out a regulatory grant?

A complete closeout package for a regulatory agreement includes the following information:

A. Final Financial Report (SF-425). See Chapter 5-230 for more information on your 

financial report.

1. You must report all program income in accordance with the cost sharing option, 

using program income to meet your required non-Federal match. You may use 

excess program income by the addition option, increasing the budget for your 

regulatory program. See Chapter 2-210 for more information on program income. 

2. You cannot show any unliquidated Federal obligations on your final report. You 

must pay all obligations before we can close the grant. 

B. Final performance narrative report. See Chapter 5-230 for information on your program 

narrative report.

C. Report of government property, if you acquired or held property under this grant. Report 

property on the Tangible Personal Property Report (SF-428) that allows for any other 

inventory format acceptable to our awarding office. Your inventory must list all 

equipment or real property acquired under this grant or transferred into this grant from 

previous regulatory grants. You must notify us whether you transferred the property to 

the subsequent regulatory grant or disposed of the property. 

D. Report of Federally-owned property, if you have any. You must provide a separate list of 

all Federally-owned property provided to you for use under this grant. Use the Tangible 

Personal Property Report (SF-428) that allows for any other acceptable property list. 

You must request that the property be transferred to a subsequent grant or properly 

disposed.
H-35

5-240-60 How will we review your information and close your grant?

Our awarding office will review the closeout package and determine if it is complete and 

acceptable. If the closeout package is not acceptable, we may return it to you with an 

explanation of what you should do to complete or correct it, ask you for additional information, 

or take other actions to resolve the problems. After we receive an acceptable closeout package, 

the awarding office must complete the following actions within 60 days.

A. Review the closeout package and the grant.

1. Verify that we have added all known changes to the grant by appropriate revisions 

or amendments.

2. Resolve any grant suspensions, withholding of funds, disputes, and violations of 

grant clauses and assurances with you.

3. Write a brief evaluation of your performance under the grant and keep it in our 

official grant file.

4. Reconcile the inventory of Federally-owned property to our records, and approve 

the transfer to a subsequent agreement.

5. Verify that the grant and the file are complete. We will use a checklist to 

document this step. 

B. Process the final grant action to de-obligate any unexpended funds. 

C. We will send you a written notice that we consider the grant to be closed, and remind you 

of the record retention and access requirements in Chapter 2-260.
I-1

Annex I: FAM Part 6 - Watershed Cooperative Agreement Program

CHAPTER 6-100

WATERSHED COOPERATIVE AGREEMENT PROGRAM

6-100-00 What does this chapter do?

6-100-10 What is the purpose of the WCAP?

6-100-20 Is your organization eligible for WCAP funding?

6-100-30 What type of project can we fund under the WCAP?

6-100-40 What are our project funding limitations?

6-100-50 What costs can you pay with WCAP funds?

6-100-00 What does this chapter do?

This chapter gives you an overview of our Watershed Cooperative Agreement Program (WCAP). 

It explains the objectives of the program, what kinds of groups and projects we support, and how 

you can use funds you receive in a WCAP agreement from us, the Office of Surface Mining 

Reclamation and Enforcement (OSMRE).

6-100-10 What is the purpose of the WCAP?

WCAP partners with other funding sources to assist groups such as small watershed organizations 

to complete local acid mine drainage (AMD) reclamation projects. 

6-100-20 Is your organization eligible for WCAP funding?

You must meet the following criteria to be eligible to apply for funds under the WCAP.

A. You must be a not-for-profit organization that is tax exempt under 26 U.S.C. 501(c)(3) of 

the Internal Revenue Code.

B. You must have other partners, contributing either funds or in-kind services to the project. 

Your partners must reflect broad-based support for the project. 

6-100-30 What type of project can we fund under the WCAP?

A. You may use WCAP funds only for AMD problems from abandoned coal mining 

operations. 

B. Because WCAP money comes from the Abandoned Mine Land (AML) Fund, projects 

must meet AML eligibility criteria.

1. Section 404 of the Surface Mining Control and Reclamation Act (SMCRA) says 

that lands and water are eligible for AML funding only if they were mined for 

coal or were affected by such mining, and were abandoned prior to August 3, 
I-2

1977, and there is no continuing reclamation responsibility under state or other 

Federal laws.

2. The appropriate state, or our legal authority, must issue a legal opinion that your 

site is eligible.

C. The project must have documented public support.

D. The state has no opposition to the project.

E. You must have written, measurable goals for the project, receiving stream and watershed. 

You must have a plan to address ongoing operational and maintenance needs for the 

project. The plan must identify how you will monitor and assess the ongoing 

effectiveness of the project, and respond to treatment problems. Our program personnel 

must review and approve your plan.

F. You should secure all other needed funding before you request funding from us. Our 

WCAP funding should be the final amount necessary for the project to proceed with 

construction.

G. If your total project costs include in-kind donations of services or materials, you must 

provide documentation that you properly valued those services or materials. 

H. The project normally should be completed within two years of when we award funds. 

However, we may extend the performance period if you provide adequate justification.

I. You must secure access to the site and use of the property through a written agreement 

before you request funding under WCAP.

6-100-40 What are our project funding limitations?

A. Normally, our funding does not exceed $100,000 per approved agreement. We are 

looking for a matching ratio of at least 2.5 to 1 in dollars contributed by other project 

partners to WCAP dollars.

B. We may approve an exception to these funding limits if you adequately justify it. We 

will evaluate the following issues to determine whether to approve a higher funding 

amount or a lower match ratio. 

1. You have made every reasonable effort to secure the additional funds from other 

sources.

2. The proposed project will be impacted if we do not provide the additional funds.
I-3

3. The project has a broad partnership in funding. The project has local participating 

individuals, companies or organizations.

4. The project has the potential for greater than usual benefits in stream and 

watershed improvements.

5. The project is part of a comprehensive watershed restoration plan. Other partners 

have a substantial investment of time and funding in this plan.

6. Our contribution is being leveraged by a substantial contribution from other 

partners.

7. The technology and design selected for the project have a high likelihood of 

success in treating the water quality and quantity without the need for frequent 

and expensive system renovations.

C. If your original cooperative agreement did not exceed these funding limits, but you later 

need more funding that would exceed the limits, you must send us an amendment 

application with all the information we need to make a decision on your request. When 

we review your application, we will evaluate the same issues for your amendment 

exception request as we would for a new project award, as listed above. 

D. If a problem develops with a WCAP project after it has been completed and we have 

officially closed the cooperative agreement, you can submit a new WCAP application to 

cover the problem areas. Your new application must comply with all requirements 

placed upon other new WCAP projects, including new matching funds.

6-100-50 What costs can you pay with WCAP funds?

A. WCAP funds are for the remediation of AMD and sources of AMD. Projects can include 

installation of “passive” or active water treatment systems, including repairs and 

renovations. Projects can include reclamation of lands that are contributing sediment or 

acid forming materials to streams.

B. The following costs could be allowable under a WCAP agreement if they are necessary 

and reasonable for your approved project.

1. Administrative costs directly associated with the approved project, such as 

financial and program administration of the cooperative agreement, preparing 

reports, traveling to the project site for monitoring purposes, and supply and 

laboratory costs for water quality sampling. You must keep proper expense 

records documenting costs including staff time and salary.

2. Construction costs directly associated with the approved project.
I-4

3. Final design and design modifications associated with the actual project 

construction. Stand-alone project designs are not allowable.

4. Pre- and post-construction water quality and quantity monitoring of an approved 

project. The post-construction monitoring must not require an extension of the 

performance period of your cooperative agreement.

5. Contract inspection and administration.

C. The following costs are not allowable under a WCAP project.

1. Indirect costs under an approved indirect cost rate.

2. Overhead.

3. Liability insurance.

4. Public relations.

5. Project ground breakings or dedications.

6. Payments to an organization or individual that owes the Federal government 

money or is in violation of Federal regulations. 

D. To ensure that funds you award to a contractor are allowable, you must check our 

Applicant Violator System (AVS) and the System for Award Management (SAM) to 

verify that the contractor is eligible before you award any contract. If you award a 

contract to any contractor listed on either system as ineligible, any Federal funds you pay 

them will be unallowable expenses. You must notify us of your AVS and SAM checks in 

your next performance report. You must document your AVS and SAM checks in your 

files. 

E. You can find requirements for land acquisition under a WCAP project in FAM Chapter 

2-200.
I-5

CHAPTER 6-200

THE APPLICATION PROCESS FOR A WATERSHED COOPERATIVE AGREEMENT 

6-200-00 What does this chapter do

6-200-10 How do you send us your application for a Watershed Cooperative Agreement?

6-200-20 When should you apply?

6-200-30 How much OSMRE funding can you apply for and how much other funding 

must you have?

6-200-40 What do you need to include in your application?

Exhibit 1 Budget Information Format

6-200-00 What does this chapter do? 

This chapter explains how you, a watershed association or non-profit organization, can apply to 

us, the Office of Surface Mining (OSMRE), for Watershed Cooperative Agreement Program 

(WCAP) funding.

6-200-10 How do you send us your application for a Watershed Cooperative Agreement?

You may send us your application by any of the following methods.

A. E-mail your application to us. You must show the name and title of the authorized 

official who signed the original forms and the date signed in the signature section of the 

application. You must maintain the original signed documents in your files. We will 

confirm that we received your application within three days of receipt.

B. Mail your complete application original signatures. We will notify you that we have 

received your application within three days of receipt.

C. Enter your application in an approved electronic portal, such as Grants.gov.

6-200-20 When should you apply?

You must submit a complete cooperative agreement application to us at least 60 days before you 

intend to start the project. 

6-200-30 How much OSMRE funding can you apply for and how much other funding 

must you have?

A. Normally our funding for a cooperative agreement does not exceed $100,000. 

B. Normally you should have a ratio of at least 2.5 to 1 for contributions from other partners 

compared to OSMRE funding.
I-6

C. We have the flexibility to approve exceptions to these limits if you provide adequate 

justification. If you request more than $100,000 in OSMRE funds or if OSMRE funding 

would be more than one-third of the total project budget, you must answer the following 

questions in your application:

1. Have you made every reasonable effort to secure the additional needed funds 

from other sources?

2. What will be the impact on the proposed project if we do not provide the 

additional funds?

3. Does the project have funding or supporting partners? Is there broad local 

participation by individuals, companies or organizations? 

4. Does the project present the potential for exceptional benefits in stream and 

watershed improvements?

5. Is the project part of a comprehensive watershed restoration plan? Have other 

partners made a substantial investment of time and funding in the watershed?

6. Would our funding be met with a substantial contribution from other partners?

7. Is it highly likely that the project’s technology and design will succeed in treating 

the water quality without the need for frequent and expensive system renovations?

6-200-40 What do you need to include in your application?

You must include the following items within your application package. 

A. Signed or approved Application for Federal Assistance document, SF-424. 

B. The Program Narrative must explain the proposed project. You can use the optional 

OSMRE 51 form or plain paper. You will need to provide the following information: 

1. Explain the need for the project.

2. Provide a summary of the project. Who will be responsible for the contract and 

oversight?

3. What are the purpose, goals and objectives of the project? Include a brief 

discussion on treatment goals of the project in terms of pH and chemistry, and 

trigger points that will initiate evaluation for operation and maintenance, 

expectations for chemical and biological impacts of the project on receiving 

stream, and how the project fits into restoration goals for the watershed.
I-7

4. Do you have the legal right of entry to the property for construction and 

continuing monitoring and maintenance? Provide a copy of the authorizing 

document.

5. Describe the technology and project design to be used, including material 

quantities, if available. If you select a passive treatment technology, the project 

must have a high likelihood of long term success, without the expectation of 

excessive maintenance or frequent rehabilitation. Include project design if 

available. Active treatment, through the use of chemical feed systems, is 

allowable with proper consideration of costs for chemicals and sludge removal 

when necessary.

6. Include all water quality and flow measurements of the discharge. Provide longterm water quality and quantity information including at a minimum: flow, pH, 

acidity, total and ferrous iron, and aluminum. We prefer that a minimum of 

twelve monthly samples be conducted. The project as constructed must have 

provisions to allow for continued monitoring.

7. Include a monitoring plan for the discharge, treatment outflow, and receiving 

stream, up and downstream. Who will be responsible for monitoring the project 

after construction?

8. Include a U.S. Geological Survey topographical map of the project area, with 

latitude and longitude.

9. Estimate how soon after the award of our funding the project will begin.

10. Include a schedule for completing the major project activities during the 

cooperative agreement performance period.

11. Describe the long term maintenance and renovation plan for taking care of any 

ongoing operational or maintenance requirements. Who will operate and 

maintain the completed project? How do you propose to fund any post 

construction operation and maintenance needs?

12. Provide required clearances including the U.S. Fish & Wildlife Service (USFWS) 

for endangered species, or comparable State clearance accepted by the USFWS, 

and state Historic Preservation Officer (SHPO). If you need assistance, our 

Watershed Project Coordinator can help you in securing these clearances.

13. List all permits that will be required. Provide assurance that you will have all 

appropriate permits prior to construction. Primary permits of interest to us are the 

wetlands, floodplains and stream encroachments, and any state environmental 

permits. Our Watershed Project Coordinator can assist you in identifying these 

permits.
I-8

14. Identify selected contractors and subcontractors, if any. All known contractors 

and subcontractors must have an Applicant Violator System (AVS) and a 

Suspension and Debarment check before the award of our funds. Our Watershed 

Project Coordinator can perform or assist you with these checks. Document your 

AVS and Suspension and Debarment checks in your files. 

C. Itemized Budget Estimate with a list of total project costs. At your option, you may use 

the Budget Information format located in Exhibit 1, or an alternative format.

1. Show the total costs by the project activity (administrative, design, construction, 

project inspection/monitoring, and other itemized major costs items).

2. Show the OSMRE funding you are requesting by activity.

3. Show other Federal agency funding by activity.

4. Show non-Federal funds by activity. 

5. Show the monetary value of in-kind services being provided by activity. 

D. Your budget justification narrative must explain each project activity included in your 

itemized budget estimate. Describe how you calculated the cost and why the item is 

needed. You must provide enough information for us to determine whether the line items 

included under each activity are reasonable, necessary and allowable.

E. Describe your organization briefly. Include the names and titles of your principal 

officers, your purposes, goals and objectives, and how long you have been established or 

incorporated.

F. Describe your organization’s financial management system including accounting 

processes, systems, and internal controls.

G. Provide a copy of your organization’s Internal Revenue Service (IRS) 501(c)(3) 

designation.

H. List partners, local support, and other resources.

1. Show the names, affiliation, roles and contributions of each participating partner. 

Divide your list into groups of partners providing funding, partners providing inkind time or materials, and supporting partners who favor the project but are not 

providing resources. 

2. Include copies of all letters from contributing partners confirming their 

commitment of funds and/or in-kind services.
I-9

3. Include copies of all letters of support for the project from local community 

groups, businesses, and individuals.

 

I. Provide signed and dated Assurances for Construction Programs form, SF 424D.
I-10

EXHIBIT 1

BUDGET INFORMATION – Construction Programs (Format)

Project Activity/Costs OSMRE 

Funding

Other 

Federal 

Agency 

Funding

NonFederal 

Partners 

Funding

Partners

In-Kind 

Contributions

Total Cost

1. Administrative

2. Design

3. Construction

4. Project Inspection/

Monitoring

5. Other Major Costs

(Itemize)

6. TOTAL

Optional Form
I-11

CHAPTER 6-210

APPLICATION REVIEW AND PROCESSING 

FOR A WATERSHED COOPERATIVE AGREEMENT

6-210-00 What does this chapter do? 

6-210-10 Who will review your application?

6-210-20 How long will we take to review and process your application?

6-210-30 How will we do our programmatic review?

6-210-40 How will we do our financial review?

6-210-50 What are our award procedures?

6-210-60 What information must be in our official cooperative agreement file?

Exhibit 1 Programmatic Review Finding and Recommendations Memo 

Exhibit 2 Sample Financial Review Appointment Confirmation Letter

Exhibit 3 On-Site Financial Review Interview and Check Sheet

Exhibit 4 Financial Review Findings and Recommendations Memo

6-210-00 What does this chapter do? 

This chapter explains the programmatic and financial policies and procedures used by us, the 

Office of Surface Mining Reclamation and Enforcement (OSMRE), to review your Watershed 

Cooperative Agreement Program (WCAP) applications. It also explains the process we use to 

award a cooperative agreement to you if we approve your application.

6-210-10 Who will review your application?

Our Watershed Project Coordinator and our Financial Specialist will review and process your 

application. They must fully coordinate and integrate all aspects of your work with us 

throughout the life of the project to help ensure its success.

6-210-20 How long will we take to review and process your application?

We will process all complete applications within 60 calendar days of receipt. 

6-210-30 How will we do our programmatic review?

A. Your complete WCAP application will be reviewed by our state Watershed Project 

Coordinator, or other field or regional staff, who will perform the following actions.

1. Determine if the application is administratively complete and all figures are 

correct.

2. Verify if funds are available. 

3. Check the System for Award Management (SAM) and our Applicant Violator 

System (AVS) to determine whether your organization or its officials are 
I-12

debarred, suspended, voluntarily excluded or ineligible to receive Federal 

assistance.

4. Contact the state Abandoned Mine Land (AML) program for their eligibility 

opinion and their input regarding the proposal.

5. Complete the National Environmental Policy Act (NEPA) review. Prepare, or 

include if prepared by others, necessary environmental documents. Verify receipt 

of necessary state Historic Preservation Officer (SHPO) and U.S. Fish and 

Wildlife Service (FWS) clearances (See OSMRE REG-1, Handbook on 

Procedures for Implementing the National Environmental Policy Act (NEPA 

Handbook) (Revised 2019).

6. Verify that project information has been entered into Abandoned Mine Land 

Inventory System (e AMLIS).

7. Conduct a technical evaluation of your proposed project including water quantity 

and quality, and treatment technology. This evaluation is to help assure the acid 

mine drainage (AMD) is treatable to proposed expectations, and that long term 

maintenance and renovation needs are known and addressed in your proposal. 

The Project Coordinator will work with you as needed to make technical changes 

to your proposed project to enhance the expected performance of the system.

8. Review your project budget and construction estimate to ensure they are 

necessary and reasonable to complete the proposed project objectives. The 

Project Coordinator may use tools such as AMDTreat to assist in evaluating the 

proposed cost of treating the water. 

9. Determine whether your request meets the standard criteria if it exceeds the 

normal funding caps. This additional determination is required if you propose 

WCAP funding over $100,000 for an agreement, or a funding ratio of partner 

contributions to WCAP funding less than 2.5 to 1. Consider the following 

criteria:

a. Has every reasonable effort been made to secure the additional needed 

funds from other sources?

b. What will the impact be on the proposed project if the additional funds are 

not provided?

c. Does the project have a broad partnership in funding and locally 

participating individuals, companies or organization? 

d. Does the project present the potential for exceptional benefits in stream 

and watershed improvements?
I-13

e. Is the project part of a comprehensive watershed restoration plan, in which 

there has been a substantial investment of time and funding by other 

partners?

f. Is our funding being supplemented by a substantial contribution from 

other partners?

g. Does the technology and design selected for the project have a high 

likelihood of success in treating the water quality and quantity without the 

need for frequent and expensive system renovations?

B. The reviewer will document the programmatic review and complete a Findings and 

Recommendations document. (See Exhibit 1 for the WCAP Programmatic Findings and 

Review document).

6-210-40 How will we do our financial review?

A. Our Financial Specialist, or other regional or field staff, will begin the financial review by 

reviewing your application. 

B. If you are a first-time applicant for WCAP funding, our Financial Specialist will review 

your internal controls and financial management systems on-site to verify that they are 

adequate to manage Federal funds. We will contact you to schedule the on-site financial 

review. We will send you a written notice to confirm the agreed review schedule and tell 

you what to expect. (See Exhibit 2 for a sample confirmation letter.) 

1. The reviewer will determine whether the systems are adequate, and suggest 

improvements where necessary. (See Exhibit 3 for the interview questions and 

system checklist used during this review.)

2. Below is a list of functions found in an adequate financial system. At a minimum, 

your system should be capable of performing the following: 

a. Cash Receipts and Disbursements Journal. 

b. Method for tracking project funds. 

c. Method for maintaining source documents.

d. Procedures for timely recording of data. 

e. Ability to summarize periodically. 

f. Payment procedures. 

g. Payroll, if applicable. 

h. Workman’s Compensation. 

i. Payroll taxes. 

j. Time cards or time sheets by project. 

k. Job/position descriptions. 
I-14

l. Procurement procedures with Standards of Conduct.

m. Property management system (must include all equipment costing at least 

$5,000). 

3. Our Financial Specialist will use the findings and recommendations memo format 

in Exhibit 4 to document the financial review, all findings, and the 

recommendations that were provided to you.

4. If you have previously received funding from us under the WCAP, the Financial 

Specialist may need to update the original review. If an updated review is not 

necessary, we will document this determination and include a copy of the initial 

review in the current project’s file. 

6-210-50 What are our award procedures?

A. Our awarding office will decide whether to approve or disapprove your application based 

on our reviews. If we approve the application, we will award the cooperative agreement. 

If we disapprove the application, we will notify you in writing of our decision.

B. Our awarding office must take the following actions to process a cooperative agreement 

award.

1. Before the award, we will provide information about the planned award to our 

Office of Communications for Congressional and public news release. Our 

awarding office must follow the notification procedure established by the Office 

of Communications.

2. We must process our cooperative agreement award through our electronic grant 

system. Our accounting system will post the award to Treasury’s financial 

assistance payment system, where it will be available for you to request funds.

3. We will send you a written cooperative agreement award document. We will also 

send you information about programmatic and financial reporting responsibilities, 

how to manage the agreement, and how to contact us. 

6-210-60 What information must be in our official cooperative agreement file?

Our awarding office must maintain the following information in the official cooperative 

agreement file. This list is considered the minimum level of documentation. We will include 

additional supporting information and reports as appropriate for the particular application, the 

recipient, and the awarding office. 

A. Your application as we originally received it, all subsequent additions and revisions, and 

any other information you sent us.
I-15

B. Records of all meetings or telephone conversations which provided information on the 

application. 

C. All our correspondence with you about the application or the award decision.

D. All our internal reviews of the application or parts of the application.

E. All explanations or resolutions of questions raised during the review process. 

F. All records or explanations of the timing of the award process, especially any time period 

when the awarding office could not process the award because it was waiting for actions 

outside its control, such as your responses to questions or availability of funds. 
I-16

EXHIBIT 1 

REVIEW FINDINGS AND RECOMMENDATIONS MEMO

Date 

Memorandum 

To: Appropriate Manager

From: Watershed Project Coordinator

Subject: Watershed Cooperative Agreement Review and Findings and Recommendation

Project Name: 

Applicant: 

Total Project Cost: $__________

OSMRE Contribution: $ __________ 

OSMRE Percentage: __________% 

Other Funding: $ __________ 

In-Kind Value: $ __________

Total Number of Partners (including OSMRE):____

Number of partners providing ONLY funding:_____

Number of partners providing ONLY in-kind services (No funding):____

Number of partners providing BOTH in-kind services and funding:_____

I. SUMMARY OF PROPOSED PROJECT 

II. APPLICATION PACKAGE

The application/case file must contain the following documents to be funded.

Yes No NA

• Completed/signed SF 424, application face sheet ( ) ( ) ( )

• Signed SF 424D, Construction Assurances ( ) ( ) ( )

• Program narrative statement – OSMRE 51(optional form) ( ) ( ) ( )

• Project budget ( ) ( ) ( )

• List of officers for AVS and Debarment check ( ) ( ) ( )

• List of project partners and contributions ( ) ( ) ( )

• AVS/Debarment checks for applicant and identified

contractors/subcontractors. (Additional

AVS/Debarment checks on contractors/subcontractors

added after award are the responsibility of the

applicant, with the assistance of ACSP coordinator, if

needed. These checks must be documented in the

quarterly and final reports.) ( ) ( ) ( )
I-17

• Documentation of legal right of access ( ) ( ) ( )

• Copy of IRS 501 (c)(3) (non-profit) designation ( ) ( ) ( )

• Eligibility opinion ( ) ( ) ( )

• Project schedule demonstrating commitment to 

completion within the two-year period of performance ( ) ( ) ( )

• Evidence of coordination with state AML authority ( ) ( ) ( )

• Evidence of e-AMLIS update ( ) ( ) ( )

• NEPA compliance (categorical exclusion or

environmental assessment and Finding of No Significant

Impact [FONSI]) as appropriate ( ) ( ) ( )

• Federally mandated clearances including USFWS for

endangered species (unless delegated to state) and state

Historic Preservation Officer (SHPO) ( ) ( ) ( )

• Identification of any permits that will be required and

assurance from the applicant of compliance prior to

construction. (Primary permits of interest to OSMRE are

for wetlands, floodplains and stream encroachments and

any state environmental permits ( ) ( ) ( )

• Long term water quality and quantity information

including, at a minimum: flow, pH, acidity, total and

ferrous iron, and aluminum. A minimum of 12 monthly

samples is preferred ( ) ( ) ( )

• A discussion of the treatment technology to be used, and 

project design, including material quantities, if available ( ) ( ) ( )

• A discussion of the long term maintenance, and

renovation expectations of the system, and the applicant’s

plan for addressing those needs ( ) ( ) ( )
I-18

III. SUMMARY EVALUATION

The project must have tangible benefits

1. Indicate benefits to be derived from completion of this project:

( ) Water quality improvement.

( ) Pollutants removed.

( ) Stream segments improved or restored.

( ) Aquatic habitat improved or restored.

( ) Public water supply improved.

( ) Fisheries improved.

( ) Recreation opportunities enhanced.

( ) Educational opportunities created. 

( ) Aesthetic enhancement.

( ) Community benefits/pride generated.

( ) Associated land restoration.

( ) Health & Safety hazards eliminated.

2. Respond to the following queries about the project.

_______ Project costs are reasonable.

_______ There are provisions for post completion operation and 

maintenance of the facility.

_______ There are provisions for post-completion water quality monitoring 

to enable evaluation of long-term success.

_______ There are no outstanding or unresolved issues.

3. Discuss treatment technology and water chemistry and evaluate probability of 

long term success and possible maintenance issues.

4. Discuss and evaluate project construction estimate

5. Identify what organization is responsible for long term maintenance of the project, 

and its capabilities.

IV. SUMMARY OF FINDINGS AND RECOMMENDATIONS 
I-19

EXHIBIT 2

SAMPLE FINANCIAL REVIEW APPOINTMENT CONFIRMATION LETTER

U.S. DEPARTMENT OF THE INTERIOR

Office of Surface Mining

Dear Applicant:

Your organization’s Watershed Cooperative Agreement Program application dated [insert date of 

application] has been referred for financial review. In accordance with payment requirements 

outlined in the Uniform Administrative Requirements, Cost Principles, and Audit Requirements 

for Federal Awards, at 2 CFR Part 200, the Office of Surface Mining Reclamation and 

Enforcement requires recipients to maintain financial data to provide for the safeguard and 

accountability of Federal funds.

To ensure [name of organization] meets these requirements, we need to review the following:

- Accounting and payroll records with supporting source documents; 

- Written procedures for purchases, accounting system, and cash management; and

- Organizational structure.

Our review will begin at [time] on [date] at [location]. This confirms our telephone conversation 

of [date] with [contact person for the organization]. If you have any questions, please phone me 

at [phone number].

Sincerely,

Financial Specialist

Office Location
I-20

EXHIBIT 3

ON-SITE FINANCIAL REVIEW INTERVIEW AND CHECK SHEET

INTERVIEW

Interviewee:

Interviewer:

Date of Interview:

Applicant’s Name:

1. Describe your organization, its purpose and history. 

2. What type of accounting system does your organization have?

- Cash/accrual 

- Checking account 

- Manual/computerized ______________________________ 

3. Who is involved in maintaining your accounting system?

- Your own staff/or accountant 

4. What kind/type of records does your organization maintain (including source 

documents)? 

5. Do you have Federal grants? If yes, how do you keep them separate? 

6. Do you know the strings attached to Federal dollars (A110 and A-122)? 

7. Do you have any non-Federal funding? 

8. Have you had a program review/audit from any source? 

9. Do you have written procedures for:

- Procurement/Contracting 

- Accounting 

- Equipment Management 

- Personnel 

- Hiring 

- Salary Increases 

- Time Cards 

- Position/job descriptions 

10. How did you arrive at the budget figures included with your application? 
I-21

ON-SITE FINANCIAL REVIEW CHECKLIST

Reviewer:

Review Date:

Applicant’s Name:

Y N NA

1. Accounting system capable of tracking OSMRE projects 

costs?

- Written procedures?

- Ability to keep OSMRE funds separate from other funds?

- Accounting staff? 

- Checking Account? 

2. Internal Control System? 

- Separation of Duties?

- Source documents summarized periodically?

3. Maintain general and subsidiary records?

4. Recent audit/program review?

5. Written purchasing/procurement/contracting procedures?

6. Written personnel records/procedures?

7. Written payroll records/procedures?

8. Written property management policies/procedures?

9. Knowledge of OMB Circulars A-110 and A-122?

10. Reviewed Proposed Project Budget?

11. Knowledge of Suspension and Debarment for 

subcontractors?

12. Does the organization owe the Federal government money? 

(A-129) 
I-22

EXHIBIT 4

FINANCIAL REVIEW FINDINGS AND RECOMMENDATIONS MEMO

UNITED STATES DEPARTMENT OF THE INTERIOR

Office of Surface Mining

Memorandum

To: Designated Official

From: Watershed Cooperative Agreement Program Financial Specialist

Subject: Financial Review

Applicant Name:

I. Summary of Findings of the Financial Review in the following areas:

 Accounting System -

 Records Management -

 Cash Management -

 Internal Controls -

 Written Procedures -

II. Summary of System Weaknesses:

III. Summary of Improvements Recommended and Communicated to the Applicant: 

IV. Technical Assistance Offered:

V. Recommendation regarding Adequacy of Financial Management System: 
I-23

CHAPTER 6-220

AMENDMENTS AND POST-AWARD CHANGES

FOR A WATERSHED COOPERATIVE AGREEMENT

6-220-00 What does this chapter do? 

6-220-10 When should you send us your request for a change?

6-220-20 What changes require an amendment? 

6-220-30 How must you request and we approve an amendment?

6-220-40 How must you request and we approve a change in the scope of your program?

6-220-00 What does this chapter do? 

This chapter explains our policies and procedures for amendments and changes after you have 

received a cooperative agreement under the Watershed Cooperative Agreement Program 

(WCAP) from us, the Office of Surface Mining Reclamation and Enforcement (OSMRE).

6-220-10 When should you send us your request for a change?

A. You must submit proposed changes to the official watershed cooperative agreement to us 

for approval before you make the actual change or obligate the funds. Costs you incurred 

before we approve the change may be unallowable.

B. We will not approve your request to change a watershed cooperative agreement

(including a time extension) which we receive after the end of the performance period, 

unless there are unforeseen circumstances not under your direct control. You must 

provide justification for such extenuating circumstances to the satisfaction of our 

designated awarding office official.

C. We should receive your request for an extension of the cooperative agreement’s 

performance period at least 30 days prior to the scheduled ending date. 

6-220-20 What changes require an amendment? 

You will need to submit an application for us to amend your cooperative agreement for the 

following changes. 

A. To add or decrease funding under the agreement. 

B. To revise the agreement’s performance period.

6-220-30 How must you request and we approve an amendment?

A. Either you or we may initiate an amendment. However, we must both agree on the 

amendment terms. 
I-24

B. You may send your application by regular mail or e-mail to the Watershed Coordinator or 

Financial Specialist at our awarding office. Your application must include the following 

items.

1. A signed or approved application face sheet, form SF-424, identifying the type of 

change you are requesting in item 8.

2. A narrative explanation and justification for the requested change. You may use 

the optional OSM-51 form or plain paper, or you may include the explanation in 

your transmittal letter.

3. If you are requesting any change to the project budget or our funding level, 

include a revised budget information report. See Chapter 6-200 for more 

information.

4. If you are requesting additional funding that would raise our total funding level 

above $100,000, or would reduce the ratio of partners to WCAP funding to less 

than 2.5 to 1, you must provide adequate information to enable our Watershed 

Coordinator to respond to the following questions: 

a. Have you made every reasonable effort to secure the additional needed 

funds from other sources? 

b. What will the impact be on the proposed project if the additional funds are 

not provided?

c. Does the project have a broad partnership in funding and locally 

participating individuals, companies or organizations?

d. Does the project present the potential for exceptional benefits in stream 

and watershed improvements?

e. Is the project part of a comprehensive watershed restoration plan, in which 

there has been a substantial investment of time and funding by other 

partners?

f. Is our contribution being leveraged by a substantial contribution from 

other partners?

g. Does the technology and design selected for the project have a high 

likelihood of success in treating the water quality and quantity without the 

need for frequent and expensive system renovations?

C. We will review your amendment application. We will process the award the same way 

we process a new cooperative agreement, as outlined in Chapter 6-210. We will approve 
I-25

the amendment within 30 days of receiving your application and notify you of our 

approval. 

D. The amendment is effective when our designated official approves it. It applies to the 

entire agreement performance period unless otherwise stated. The approved amendment 

becomes part of the original agreement.

6-220-40 How must you request and we approve a change in the scope of your program?

A. A scope change is any change in the objectives of the program or the work to be 

performed that is outside the plans approved in the original grant and that has the 

potential to affect the success of the program. Examples of scope changes are a 

significant change in your partners or their contributions, or unforeseen site conditions 

which require you to change your reclamation approach.

B. You must get our written approval before you make a scope change. However, a scope 

change does not require a formal amendment to your cooperative agreement.

B. You should send a written request for our approval of a scope change to our awarding 

office as soon as you determine the change is needed. An authorized official of your 

organization must send a letter or e-mail requesting the change. Your request must 

include a narrative explanation and justification for the requested change, either in your 

letter or on the optional OSM-51 form. 

C. Our awarding office will notify you in writing whether or not we approved your request. 

We will send the decision letter no later than 15 days after we receive your request. If the 

request is still under consideration at the end of 15 days, the awarding office must inform 

you in writing when a decision on the request may be expected and the reasons for the 

delay.
I-26

CHAPTER 6-230

PERFORMANCE AND FINANCIAL REPORTING 

FOR A WATERSHED COOPERATIVE AGREEMENT

6-230-00 What does this chapter do

6-230-10 When must you send us reports?

6-230-20 How can you submit your reports to us?

6-230-30 What information must you provide? 

6-230-40 How will we review your reports?

6-230-00 What does this chapter do? 

This chapter explains the reports required from you as a recipient of funds from us, the Office of 

Surface Mining (OSMRE), under our Watershed Cooperative Agreement Program (WCAP). It 

describes when your reports are due, how to submit them, and what program and financial 

information you must report to us. 

6-230-10 When must you send us reports?

A. Watershed cooperative agreements normally have a performance period of two years. 

You must submit WCAP performance and financial reports every six months. 

B. Interim reports are the reports you make while the cooperative agreement’s performance 

period is ongoing. Your interim reports are due in our awarding office thirty (30) days 

after the end of each six month reporting period. 

C. Your first interim reporting period starts on the effective date of the cooperative 

agreement. The reporting period for an interim report must end on a calendar quarter end 

date: March 31, June 30, September 30, or December 31. If your cooperative agreement 

starts on a date in the middle of a calendar quarter, extend your first report period to the 

next calendar quarter end date. For example, if your agreement started on May 1, the 

first six months would end October 30, but you would extend the first reporting period 

until December 31 and send the report to us by January 30. Depending on the effective 

date of your cooperative agreement, the reporting period for your first interim reports 

may be a little longer than the six month time frame.

D. Subsequent interim report periods start on the first day of the next calendar quarter and 

last for six months.

E. Your final performance and financial reports are due to us 90 days after the end of the 

project or the cooperative agreement’s performance period. The reporting period for the 

final report ends on the last day of the performance period regardless of whether the last 

day is a calendar quarter end date. You will find further guidance on closing out your 

WCAP cooperative agreement in Chapter 6-240.
I-27

F. If you cannot send us a report on time, you must contact us before the established due 

date. We may extend the due date based on your adequate justification.

6-230-20 How can you submit your reports to us?

A. You may submit paper reports by regular mail or any other delivery method. The report 

must have an original signature. Send your reports to the financial specialist in our 

awarding office. 

B. You also have the option of sending your reports by e-mail. The forms must include the 

name and title of the authorized official who signed the original report, and the date 

signed. You must maintain the original signed documents in your files.

6-230-30 What information must you provide? 

Your interim and final reports include two parts: a narrative performance report, and a financial 

report.

A. Project Performance Information. You can write your performance narrative on our 

optional OSMRE 51 form or on plain paper. Whether you use the form or a blank page, 

your performance report must include the following information.

1. Describe your program’s accomplishments.

a. What progress did you make toward meeting your overall project 

objectives?

b. What progress did you make on the specific activities funded by WCAP, 

such as design, construction, etc.? 

c. If you have not yet started construction, what progress did you make 

toward it? You should document your receipt of permits and Applicant 

Violator System (AVS)/Debarment checks on contractors and 

subcontractors. 

d. Is the project is on schedule? If not, explain why and what changes will 

be made. Explain unforeseen obstacles and the impact of those obstacles. 

e. Explain any problems you resolved and how you did it. 

f. Explain any project changes needed, such as in design or treatment 

technology. 

2. Include Partnership information within your narrative. 
I-28

a. Has the participation of the partners listed in your cooperative agreement 

application gone according to plan? 

b. Have any partners withdrawn their planned contributions to the project? 

List the name and explanation. 

c. Have you added any new partners? List the name and their planned 

contribution. 

d. How will losing and/or gaining these partners affect the overall objectives 

and accomplishments of the project?

3. Other. Your narrative reports are one of the tools you use to communicate with 

us. If you have any information, concerns, etc. that you would like to provide us 

that may not be listed in the areas noted above, please do not hesitate to include 

them in this section of your narrative.

4. In addition to the financial data provided on your financial report document, in 

your narrative you should explain any financial concerns. Have costs been in line 

with the project budget? Explain any significant cost under or overruns and their 

impact on the project.

B. Financial Report. The financial report must use the Federal Financial Report form, SF 

425. 

1. You must provide financial information for the same activities as reflected in your 

approved budget. 

2. Your financial report must be prepared on a cash basis. All costs claimed from 

our funding must be allowable under federal regulations. You must be able to 

support all costs claimed and be able to reconcile them to your accounting 

records.

3. You should include financial information on the overall project and our WCAP 

funding. You should include the dollar value of in-kind contributions in the costs 

you report. 

6-230-40 How will we review your reports?

 A. We will review your reports to determine that you have included all the information we 

need and complied with the following basic requirements. 

1. Your reports and forms must be signed or approved by your authorized 

representative. 
I-29

2. We must receive your reports by the established report due date.

3. Your reports must be mathematically accurate. 

4. Your reported activities and costs must be in compliance with the approved 

cooperative agreement application.

5. All costs reflected in your reports must be supported by your accounting records 

and must be reconcilable to them.

6. Within your report, you must compare the actual accomplishments to the planned 

objectives of your program.

B. If we identify any concerns, we will work with you to correct the report.

C. We will document our reviews in a report or monitoring statement and keep them in our 

official file. 
I-30

CHAPTER 6-240

CLOSING A WATERSHED COOPERATIVE AGREEMENT

6-240-00 What does this chapter do?

6-240-10 When do we close a cooperative agreement?

6-240-20 When are your closeout reports due to us?

6-240-30 How can you get the due date for the closeout reports extended?

6-240-40 How can you submit your closeout reports?

6-240-50 What information must you provide in your closeout reports?

6-240-60 How will we review your reports and close your agreement?

6-240-70 How long do you need to keep your records?

Exhibit 1 In-Kind Services

6-240-00 What does this chapter do?

This chapter explains how to prepare and send us your final reports on your cooperative 

agreement. It applies to you if you received Watershed Cooperative Agreement Program 

(WCAP) funding from us, the Office of Surface Mining Reclamation and Enforcement 

(OSMRE). This chapter also explains how we will close the cooperative agreement. 

6-240-10 When do we close a cooperative agreement?

A. The closeout process begins when the performance period of your cooperative agreement 

ends. Normally we will complete the closeout within 180 days of the end of the 

agreement. 

B. We will not close the cooperative agreement until you have paid out all costs and we 

have deobligated any funds you did not spend.

C. We will not close a watershed agreement if the agreement is in litigation or under appeal.

D. If we terminate your agreement or end it early, we will not close it until all termination 

actions have been completed.

6-240-20 When are your closeout reports due to us?

You must send us the complete package of closeout reports on your watershed project by 90 days 

after the end of the performance period.

6-240-30 How can you get the due date for the closeout reports extended?

You need to make every reasonable effort to send us a complete closeout package by the due 

date. However, if you will not be able to submit the closeout reports on time, you must send us a 

written request for an extension. The request must provide acceptable justification explaining 

why you need an extension and committing to send us the reports by a revised due date that you 
I-31

propose. If we approve your extension request and notify you in writing, we may require you to 

submit interim reports. 

6-240-40 How can you submit your closeout reports?

A. You can send us your closeout reports on paper through regular mail.

B. Alternatively, you may e-mail your report package to us. You must type the name and 

title of the authorized official who signed the original forms and the date signed in the 

signature section of the document. You must maintain the original signed documents in 

your files.

6-240-50 What information must you provide in your closeout reports?

Your closeout reports must include the following information. While we financially supported 

only a part of the project objectives, you should provide programmatic and financial information 

for the entire project, not just the activities we funded. 

A. Closeout Project Performance Narrative. You can use our optional OSM-51 form or 

plain paper to complete the narrative.

1. This is where you describe your programmatic and financial accomplishments. 

Compare the goals of the project and the final actual accomplishments.

2. Provide an “as built” plan of the treatment system, if available, and quantities of 

materials used.

3. Provide performance information after system is operational, regarding influent 

(untreated water) and final effluent (treated) water flow and chemistry including 

date of collection, pH, ferrous and ferric iron, acidity and aluminum.

4. Explain any problems you encountered and how you resolved them.

5. Provide any explanations needed regarding project partners. Did the participation 

of the partners listed in the agreement go according to plan? 

.

B. In-Kind Contributions of Services or Materials.

1. If the project included in-kind services or materials contributed by you or any of 

the other project partners that directly contributed to the completion of the project, 

list the following information for each organization. 

a. Describe the in-kind services or materials provided.

b. Show the quantity of each service or material provided.
I-32

c. Calculate a value for each type of in-kind service or material provided. 

Exhibit 1 of this chapter is a format you may use to help calculate and 

document your in-kind contributions.

 

2. Calculate your total in-kind contributions and include the value in the total 

expenditures on your financial report. 

C. Final Financial Report. You must use the Federal Financial Report, form SF- 425.

 

1. Your final financial report should include the same type of information as you 

provided in your previous interim reports. 

2. Provide financial information for the whole project, not just WCAP funds. 

3. Report your financial information on a cash basis.

4. All the costs you claim on the report must be allowable under WCAP and other 

Federal regulations. You must have accounting records supporting all the claimed 

costs, and you must be able to reconcile the report back to your accounting 

records. 

D. Property Purchased with our Funds. If you acquired any equipment or real property 

under the cooperative agreement, you must provide a property inventory. Use the 

Tangible Personal Property Report (SF-428). This form allows for alternative formats. 

1. If we approved any property in your application but you did not purchase it, you 

do not need to provide an inventory. However, you do need to explain in your 

program narrative why you did not buy the approved equipment.

2. You must include the following information on the inventory for all property 

acquired under the agreement.

a. Description

b. Manufacturer 

c. Manufacturer Serial Numbers

d. Quantity of each item purchased

e. Cost of each item

f. Date property was received 

g. Current condition of property

h. Location where property is stored

I. Disposition request (to sell it, trade it in, transfer it to another project, etc.)

3. Include a brief description of how you monitor and safeguard the property.
I-33

4. If you are requesting the sale or trade-in of an item, you will need to explain how 

you will handle the sale or trade-in. 

6-240-60 How will we review your reports and close your agreement?

A. When we receive your closeout reports, our watershed project coordinator and financial 

specialist will review the reports to determine that the report package is complete and 

acceptable. They will perform the following requirements.

1. Verify that we have added all known changes into the agreement by appropriate 

revisions or amendments.

2. Resolve with you any disputes, suspensions, withholdings, and violations of 

agreement clauses and assurances.

3. Verify that final information on the reclamation problem area has been entered 

into the Enhanced Abandoned Mine Land Inventory System (e-AMLIS).

4. Write a brief written evaluation of your performance under the cooperative 

agreement and keep it in our official agreement file.

5. Advise you how to dispose of, or take appropriate safeguard on, any property 

purchased with our funds.

6. Verify that the agreement and our official file are complete. We will use a 

monitoring statement and a closeout checklist to document this step. 

B If we determine that the closeout is not complete or acceptable, we may return it to you 

with an explanation of what must be done to make it acceptable, ask you for additional 

information, or take other actions to resolve the problems.

C. If there are unexpended funds remaining in the cooperative agreement, we must prepare 

and process an amendment to deobligate the excess funds.

D. We will send you written notification that we consider the watershed cooperative 

agreement closed. We will remind you of the requirements for you to keep the records of 

your cooperative agreement and allow us to access them. We will show the starting date 

for the record retention period, which will be the date you submitted to us your final 

financial report for the watershed cooperative agreement. 

6-240-70 How long do you need to keep your records?

You must maintain financial and programmatic records for the project for three years. Our letter 

to you notifying you that the cooperative agreement is officially closed will show the date when 

this three-year period starts. See Chapter 2-260 for more information on record retention 

requirements.
I-34

EXHIBIT 1

IN-KIND SERVICES

Sponsor Organization: Dates Covered by Report:

SERVICE/MATERIAL AMOUNT VALUE

SUPPLIES

 Computers/Printers # of months used @ cost per month

 Photocopies # of copies @ agency rate 

 Telephone # of calls @ agency rate

 Fax # of pages faxed @ agency rate

 Postage Actual expense

SUPERVISION # of hours x supervisor’s actual rate of pay

TRAVEL # of miles @ agency rate (not to exceed current 

government mileage rate)

OFFICE SPACE # of square feet x actual cost per month 

(include rationale for # of square feet used)

VOLUNTEER 

WORKERS

# of hours x minimum wage rate

OTHER: May include, 

but is not limited to:

 Prorated utilities

 Accounting

 Maintenance

 General overhead

 (document)
J-1

Annex J: FAM Part 7 - Technical Studies Cooperative Agreement Programs

CHAPTER 7-100

TECHNICAL STUDIES PROGRAM OVERVIEW

7-100-00 What does this chapter do?

7-100-10 Why was the Technical Studies program established?

7-100-20 What are the objectives of the Technical Studies program?

7-100-30 Where can you find out about specific assistance opportunities?

7-100-40 What other applicable requirements for a Technical Studies cooperative 

agreement? 

7-100-00 What does this chapter do?

This chapter provides a general overview of our Technical Studies program. The work performed 

under this program support the abandoned mine land and regulatory programs of the Surface 

Mining Control and Reclamation Act of 1977, as amended (SMCRA). They are performed by 

parties other than us at the Office of Surface Mining Reclamation and Enforcement (OSMRE) 

and include applied science projects, underground mine map projects, and technical 

investigations. 

7-100-10 Why was the Technical Studies program established?

A. We work with state and tribal partners to ensure that citizens and the environment are 

protected during coal mining and that the land is restored to beneficial use when mining 

is finished. We also work with states and tribes to reclaim and restore lands and water 

degraded by mining operations before SMCRA was enacted. Additionally, we work with 

colleges and universities and other state and federal agencies to further the science of 

reclaiming mined lands and protecting the environment. 

B. During fiscal year (FY) 2005, Congress approved our request for a program to fund 

proposals for applied science projects and for underground mine map projects. Our 

operating annual budget provides funding for these projects.

C. Addressing the need to map underground mines requires significant federal support. We 

developed the Underground Mine Mapping Initiative (UGMMI) as part of our Technical 

Studies program to meet these needs. Through the Underground Mine Map Steering 

Committee, we collaborated with the Interstate Mining Compact Commission (IMCC) 

and Western Interstate Energy Board (WIEB) to coordinate Underground Mine Map 

Projects. We also collaborated with the Mine Safety and Health Administration (MSHA) 

and various state agencies to complete underground mine map projects.

7-100-20 What are the objectives of the Technical Studies program?

The Technical Studies program supports two efforts:
J-2

A. Applied Science projects develop and demonstrate improved technologies to address 

public safety and environmental issues related to mining coal and reclaiming the lands 

affected by mining.

B. Underground Mine Map projects encourage efforts to collect, preserve and convert into 

digital format maps of underground coal mines. The maps provide valuable information 

for protecting public and miner safety, evaluating mine pools, and investigating mine 

subsidence.

7-100-30 Where can you find out about specific assistance opportunities?

We will announce opportunities for Technical Studies cooperative agreements in three channels. 

You will find additional information on specific opportunities and how to apply for them as 

follows:

A. We will post the announcement on Grants.gov. Grants.gov is the federal government’s 

website to announce and accept applications for federal grant and cooperative agreement 

opportunities. 

B. We will post the announcement on OSMRE’s Technology Transfer web page.

C. We will send announcements by direct mail or electronic mail to organizations that have 

shown an interest in SMCRA-related activities.

7-100-40 What other applicable requirements for a Technical Studies cooperative 

agreement? 

If you receive a cooperative agreement, the following requirements apply:

A. You must keep records in accordance with the Uniform Administrative Requirements, 

Cost Principles, and Audit Requirements for Federal Awards, at 2 CFR Part 200, Subpart 

D. 

B. You must send us quarterly reports on your technical and financial performance under the 

cooperative agreement.

C. You may also be required to meet the audit requirements. 
J-3

CHAPTER 7-110

APPLIED SCIENCE COOPERATIVE AGREEMENTS

7-110-00 What does this chapter do?

7-110-10 What is the objective of applied science projects?

7-110-20 Who is eligible for an applied science cooperative agreement?

7-110-30 Where can you find out about applied science opportunities?

7-110-40 What requirements must your proposal meet?

7-110-50 What costs are allowable?

7-110-60 How will we review and select proposals

7-110-70 What happens if we select your proposal?

7-110-00 What does this chapter do?

This chapter provides guidance on how you can propose an applied science project. It explains 

how we, the Office of Surface Mining (OSMRE), review and select proposals, and how we 

award applied science cooperative agreements. 

7-110-10 What is the objective of applied science projects?

Our objective is to further the science of reclaiming mined lands and protecting the environment. 

We request proposals for projects that develop and demonstrate improved technologies to 

address environmental issues related to surface coal mining and land reclamation after mining. 

We provide funding for selected projects through cooperative agreements. 

7-110-20 Who is eligible for an applied science cooperative agreement?

Public, private, or non-profit entities are eligible. You may be a Federal, state, local, or tribal 

government entity, a college or university, or other qualified entity. 

7-110-30 Where can you find out about applied science opportunities?

If funding is available, we will announce the opportunity for assistance. You may obtain a copy 

of the announcement using the sources we identified in Chapter 7-100-30. Our announcement 

will include any high priority topics we identify for that year. 

7-110-40 What requirements must your proposal meet?

Your proposal must meet the following requirements.

A. Address coal mining reclamation issues in at least one of our three regions.

B. Include a summary statement addressing the proposal’s value associated with coal mining 

reclamation or regulation.
J-4

C. Do not propose quality control or consumer evaluations for commercial products.

D. You may include costs for salaries, fringe benefits, travel, equipment, materials, and 

services. 

E. Do not include fees or profit.

F. Do not include Federal employee salary or compensation.

G. Your proposal must meet the “Instructions for Preparing the Proposal” in our funding 

opportunity announcement.

7-110-50 What costs are allowable?

A. In general, you may spend funds from the cooperative agreement for costs which are 

directly associated with your approved project and are reasonable and necessary to 

conduct it. 

B. Costs must be allowable under the Office of Management and Budget’s cost principles. 

See the applicable section in the Code of Federal Regulations (CFR), Title 2 Part 200, for 

more information. 

7-110-60 How will we review and select proposals? 

We have a multi-tiered process to review, rank and score proposals. The process was developed 

by the National Technology Transfer Team (NTTT), a partnership organization of 

representatives from our coal mining states and tribes and OSMRE. 

A. Technical experts provide a detailed evaluation and pre-decisional scoring of the 

proposals. Then NTTT uses consensus final scoring to identify the highest ranked 

proposals. 

B. Our technical representatives and grants staff review the proposals with the highest scores 

to identify other technical and financial assistance issues that might affect the award. The 

NTTT provides a summary of the top rated proposals to OSMRE senior management.

C. Senior management will make recommendations to the Director who will select which 

proposals that will receive funding. 

7-110-70 What happens if we select your proposal?

A. If we select your proposal, we will contact you about the following information.

1. We will list any additional information or documents we need in order to award 

your cooperative agreement.
J-5

2. We will identify all of your and our relevant points of contact for this proposal. 

3. We will identify specific conditions that you must meet. 

4. We will define the level of substantial Federal involvement. Substantial Federal 

involvement is a requirement for Federal cooperative agreements. 

5. We will outline specific reporting requirements. 

6. We will address any questions or issues you may have.

B. Once we have gathered all of the required information, we will process your cooperative 

agreement. We will send you a written award document. This document will include all 

special conditions that apply to your cooperative agreement. We will also send you 

information on OSMRE contacts for your agreement, any other conditions of your award, 

reports, and closeout requirements. 

C. Your cooperative agreement will show the start and end dates of your performance 

period. 

1. You cannot incur costs before the start date, or after the end date, of your 

performance period. 

2. You may begin requesting funds from the U. S. Treasury’s electronic payment 

system on or after the start date of the performance period. 

3. You may request an extension of your performance period. However, we must 

receive your request at least 30 days before the date the performance period is 

scheduled to end.
J-6

CHAPTER 7-120

UNDERGROUND MINE MAP COOPERATIVE AGREEMENTS

7-120-00 What does this chapter do?

7-120-10 What is the objective of underground mine map projects?

7-120-20 Who is eligible for an underground mine map cooperative agreement?

7-120-30 Where can you find out about underground mine map opportunities?

7-120-40 What requirements must your proposal meet?

7-120-50 What costs are allowable?

7-120-60 How will we review and select proposals?

7-120-70 What happens if we select your proposal?

7-120-00 What does this chapter do?

This chapter provides information you can use to submit a proposed underground mine map 

project. It explains how we, the Office of Surface Mining Reclamation and Enforcement 

(OSMRE), review and select proposals and how we award underground mine map cooperative 

agreements. 

7-120-10 What is the objective of underground mine map projects?

Our objective is to cooperate with you on projects to continue efforts to acquire, preserve, 

archive, and distribute underground coal mine maps. We fund these projects through cooperative 

agreements. Our ultimate goal is to improve protection of the public and the environment by 

making all maps accessible. 

7-120-20 Who is eligible for an underground mine map cooperative agreement?

You are eligible if you meet all three of the following criteria:

A. You must be an agency of a state, U.S. territory or tribal government. 

B. You must possess hard-copy underground coal mine maps. 

C. You must be able to meet our minimum scanning requirements. 

7-120-30 Where can you find out about underground mine map opportunities?

If funding is available, we will announce the assistance opportunity. You may obtain a copy of 

the announcement using the sources we identified in Chapter 7-100-30. Our announcement will 

include any high priority topics we identify for that year. Your proposal will receive additional 

consideration if you address one of those high priority topics.

7-120-40 What requirements must your proposal meet?
J-7

Your proposal must meet the following requirements:

A. Support activities in at least one of our three regions.

B. Include a letter of endorsement by an authorized official representing your state agency.

C. You may include costs for salaries, fringe benefits, travel, equipment, materials, and 

services. 

D. You cannot include fees or profit.

E. You cannot include costs of Federal employee salary or compensation.

F. Your proposal must meet the “Instructions for Preparing the Proposal” in the 

announcement.

7-120-50 What costs are allowable?

A. In general, you may spend funds from the cooperative agreement for costs which are 

directly associated with your approved project, and are reasonable and necessary to 

conduct it. 

B. For more information about allowable costs, you should refer to the cost principles 

established by the Office of Management and Budget. See the Code of Federal 

Regulations, under 2 CFR Part 200. 

7-120-60 How will we review and select proposals? 

A. After we receive all the proposals, a team of Underground Mine Map Steering Committee 

members will review and rank them. Ranking criteria include viability, innovation, 

proposal quality, ability to address special interest topics (if identified), and level of 

external financial support. 

B. Our technical representatives and grants staff will review the proposals with the highest 

scores to identify other technical and financial assistance issues that might affect the 

award. 

C. The OSMRE Executive Council will approve the final projects. 

7-120-70 What happens if we select your proposal?

A. If we select your proposal, we will contact you about the following information:

1. Additional documents that we require. 
J-8

2. We will identify all relevant Federal and recipient points-of-contact.

3. We will identify specific conditions. We will define the level of substantial 

Federal involvement. These are required for Federal cooperative agreements. 

4. We will outline reporting requirements. 

5. We will discuss any questions or issues you may have.

B. When we have all the required information, we will process your cooperative agreement. 

We will send you a written award document. This document will include all special 

conditions that apply to your cooperative agreement. We will also send you information 

about any other special conditions of your award, OSMRE contacts for your project, and 

reports and closeout. 

C. Your cooperative agreement will show the start and end dates of your performance 

period. 

1. You cannot incur costs before the start date, or after the end date, of your 

performance period. 

2. You may begin requesting funds from the U. S. Treasury’s electronic payment 

system on or after the start date of the performance period. 

3. You may request an extension of your performance period. However, we must 

receive your request at least 30 days before the performance period is scheduled 

to end
J-9

CHAPTER 7-210

APPLICATION REVIEW AND PROCESSING 

FOR A TECHNICAL STUDIES PROGRAM COOPERATIVE AGREEMENT

7-210-00 What does this chapter do?

7-210-10 How long will we take to process your application?

7-210-20 What do we require to make your application administratively complete?

7-210-30 How will we review your application? 

7-210-40 How will we award your cooperative agreement?

7-210-50 What are our records requirements?

7-210-00 What does this chapter do?

This chapter explains the procedures used by us, the Office of Surface Mining Reclamation and 

Enforcement (OSMRE), to review and complete your application for a Technical Studies 

program cooperative agreement. It also explains how we will award your cooperative agreement 

if we select your proposal for funding.

7-210-10 How long will we take to process your application?

We will process all selected proposals within 60 days of the date we select winning proposals or 

the date we receive a complete application, whichever is later. We will use this time to obtain 

additional documents, agree upon our level of significant Federal involvement, and finalize any 

other issues about your cooperative agreement.

7-210-20 What do we require to make your application administratively complete?

We require the following documents to form an administratively complete application. 

A. Signed or approved Application for Federal Assistance, form SF-424.

B. Narrative budget explanation and justification. You may use optional form OSM-47 or 

an alternative format.

C. Signed or approved Non-construction Assurances document, form SF424 B.

D. Signed or approved Construction Assurances document, form SF 424 D, if applicable.

E. Certifications document for compliance with Debarment and Suspension, Drug-Free 

Workplace, and Lobbying requirements.

F. Disclosure of lobbying activities, form SF-LLL, if applicable.

G. Indirect cost rate proposal for the year of the award approved by a Federal agency.
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7-210-30 How will we review your application?

A. We will ensure that your application package is complete. We will also validate budget 

information in your application. We will contact you if we need additional information. 

B. We will contact you for a meeting or teleconference to accomplish the following.

a. We will clarify all deliverables for your project.

b. We will identify the type and extent of our involvement in the project. This 

includes milestones, decision points, and direct participation, where applicable.

c. We will identify primary Federal and recipient contacts.

d. We will discuss payment issues and financial and programmatic reporting 

requirements during your agreement.

C. We will develop a document with terms and conditions to supplement the cooperative 

agreement. This document will give specific requirements and responsibilities necessary 

to carry out the terms of the agreement based on our previous discussions with you. We 

will provide the document to you for comment and approval.

D. We will confirm availability of funds.

E. We will check the System for Award Management (SAM) to determine if you are 

excluded from receiving this Federal assistance. 

F. We will determine if you are subject to the single audit requirement found in the Uniform 

Administrative Requirements, Cost Principles, and Audit Requirements for Federal 

Awards, at 2 CFR Part 200 Subpart E. If so, we will confirm that you have met the 

requirement.

G. The technical and financial specialists who will work with your project must document 

their recommendations to proceed with the award.

7-210-40 How will we award your cooperative agreement?

A. We will enter your application data into our electronic grant system.

B. We will notify our Office of Communications of the planned award so they may issue 

Congressional and public news releases. Our awarding office must follow the 

notification procedure established by the Office of Communications.
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C. Our awarding office will approve your cooperative agreement in our electronic grant 

system. Our accounting system will update Treasury’s financial assistance payment 

system, which will process your cash requests.

D. We will send you the written cooperative agreement with all applicable terms and 

conditions. 

E. If we cannot approve your cooperative agreement, we will contact you in writing. We 

will explain the reasons for our action, and provide corrective actions if applicable.

7-210-50 What are our records requirements?

Our awarding office must maintain the official file for the cooperative agreement. At a 

minimum, the official file must contain the following records.

A. Your application as originally received, all additions or revisions to it, and any other 

information you provided.

B. All meetings or telephone conversations about your application and/or proposal.

C. All our correspondence with you related to the application or award.

D. All of our internal reviews of your application.

E. Our approved budget authority to make an award.

F. All questions that were brought up during the review process and the resolution of those 

questions.

G. Explanations of any delays in the timing of the award.

H. Documentation of specific actions by the project technical point-of-contact which make 

up our substantial involvement in the project.
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CHAPTER 7-220

AMENDMENTS AND POST-AWARD CHANGES

FOR A TECHNICAL STUDIES PROGRAM COOPERATIVE AGREEMENT

7-220-00 What does this chapter do?

7-220-10 When can you request changes to your cooperative agreement?

7-220-20 What changes require an application and amendment?

7-220-30 How must you apply for an amendment?

7-220-40 What changes require your written request and our approval?

7-220-50 How will we process your change requests? 

7-220-00 What does this chapter do?

If you need to make a program or budget change to your cooperative agreement, this chapter 

explains which changes require our approval, how you should submit your request for a change, 

and how we will process your request. This chapter applies to cooperative agreements awarded 

to you for the Technical Studies program, including Applied Science cooperative agreements and 

Underground Mine Mapping cooperative agreements, by us, the Office of Surface Mining 

Reclamation and Enforcement (OSMRE).

7-220-10 When can you request changes to your cooperative agreement?

A. You must submit your proposed change or amendment and get our approval before you 

actually make the change or obligate any funds. If you incur costs prior to our approval, 

we may disallow those costs.

B. We will not approve any change in your agreement if we receive your request after the 

scheduled end date of the performance period. If you have unforeseen circumstances that 

are out of your control, then we will consider your explanations on a case-by-case basis.

C. If you are requesting a time extension, you must submit your request at least 30 days 

prior to the scheduled performance period end date. If we approve your request, we will 

normally approve only one extension for a period no longer than one year. If you require 

additional consideration, you must justify your special or unusual circumstances.

7-220-20 What changes require an application and amendment?

A. You must submit a formal application for an amendment to your cooperative agreement if 

you wish to change any of the following items.

1. Adding more funds to your agreement. 

2. Deobligating unneeded funds before the end of your performance period.

3. Extending or shortening your performance period.
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4. A material change in the level of financial contribution by other contributors to 

your project.

B. If you are unsure if your change requires an amendment, please contact the grant 

specialist in our awarding office for assistance.

7-220-30 How must you apply for an amendment?

A. You may submit your application for an amendment to our awarding office by regular 

mail or e-mail. You must have the capability to submit signed documents. Scanned 

documents are acceptable.

B. Your amendment application must include the following items at a minimum. 

1. Signed Application for Federal Assistance, form SF-424.

2. A program narrative explaining and justifying the requested change. You may use 

our optional form OSMRE 51 or any format, or include the narrative in your 

transmittal letter.

3. Revised budget information, if you are requesting a change in the budget.

7-220-40 What changes require your written request and our approval?

A. You may request the following changes to your cooperative agreement by a written 

request. These changes require our prior approval but do not require a formal application 

and amendment.

1. Changes in key personnel working on your project.

2. Changing the scope of your project. Scope changes are changes in the goals or 

objectives of the agreement, or the work you will perform, from your original 

application that have the potential to affect the success of your program. 

3. Cumulative budget transfers between direct cost categories that exceed ten 

percent (10%) of the approved budget.

4. Any cost item not included in the original budget that requires our approval to be 

allowable. An example of a cost item which is allowable only with our prior 

approval is equipment. You can find more information regarding these cost items 

in the applicable Office of Management and Budget (OMB) cost principles at 2 

CFR Part 200.

 
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B. Your written request must include a narrative justification of the requested change. If you 

are requesting a budget change, you must include revised budget information. You must 

send this request to the grant specialist in our awarding office. You may send the request 

by regular mail or by e-mail. 

7-220-50 How will we process your change requests? 

A. We will make a decision on your request within 30 days of receiving it. If we need more 

time to consider your requests, we will notify you as to when we will decide.

B. If we approve your request, we will send you our approval in writing within 30 days of 

receiving your request. In the case of an amendment, we will process your application 

and approve the amendment in the same way we process new cooperative agreement 

applications as described in Chapter 7-210.
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CHAPTER 7-230

PERFORMANCE AND FINANCIAL REPORTING 

FOR A TECHNICAL STUDIES PROGRAM COOPERATIVE AGREEMENT

7-230-00 What does this chapter do?

7-230-10 Where do these requirements come from?

7-230-20 When must you submit reports? 

7-230-30 How can you submit reports to us? 

7-230-40 What reports must you submit?

7-230-50 How will we review your reports? 

7-230-00 What does this chapter do?

This chapter explains our reporting requirements for the Technical Studies program funded by 

the Office of Surface Mining Reclamation and Enforcement (OSMRE). It describes what reports 

you must complete, when they are due, and what information you must include. This 

information applies to you as a recipient of a cooperative agreement for an applied science 

project or an underground mine map project.

 

7-230-10 Where do these requirements come from?

The Department of the Interior has established the requirements for submission of recipient 

performance and financial reports in the Uniform Administrative Requirements, Cost Principles, 

and Audit Requirements for Federal Awards at 2 CFR Part 200, Subpart D. 

7-230-20 When must you submit reports? 

A. You must submit interim performance and financial reports to us quarterly. Interim 

reports are due to us 30 days after the end of the report period. The report period for the 

first report begins on the effective date of your cooperative agreement. The report 

periods for interim reports must end on the last day of a calendar quarter: March 31, June 

30, September 30, or December 31. If your cooperative agreement starts during a 

calendar quarter, calculate 90 days then extend your first report period to the next quarter 

end date. Subsequent reports are due for every three-month period. 

B. You must submit the final performance and financial reports within 90 days after the end 

of your performance period. The reporting period for a final report ends on the last day 

of the performance period. 

C. If you cannot submit a report by the required due date, contact us before the due date. 

We may extend the report due date based on your adequate justification.

7-230-30 How can you submit reports to us? 

A. You may submit reports by regular mail. Paper reports must have an original signature.
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B. You may also submit reports by e-mail. The forms must include the name and title of the 

authorized official who signed them and the date signed. You must maintain the 

originally signed forms in your files. 

7-230-40 What reports must you submit?

You must submit the following reports.

A. Financial Report. You must submit the financial report on the SF 425, Federal Financial 

Report. You must submit your financial reports on a cash basis. 

B. Narrative Performance Report. You may use the optional OSMRE 51 form, a blank 

page, or another acceptable format. You must include the following information in your 

report.

1. Your OSMRE cooperative agreement number.

2. A brief introduction of your project. You may use the same introduction for 

every performance report you submit on this project.

3. Task description listing the tasks that you have initiated during this report period. 

The descriptions must come from the statement of work.

3. Summarize this quarter’s accomplishments and significant events. If any 

milestones have been reached or significant advances made, list them here. For 

Underground Mine Mapping agreements, provide details of work including the 

number of maps acquired, restored, preserved, scanned, georeferenced, etc.

4. List to-date accomplishments, with the percentage completion on all tasks 

scheduled up to this date. This section will take a broader perspective than the 

previous section.

5. For Applied Science agreements, discuss technical progress. This section is left 

to your discretion. You may embed figures and tables in the text or put them on 

separate pages. Note that any data must be accompanied by a thorough 

description, and any tables or figures need to be able to stand on their own. 

6. Your plans for the next reporting period. List which tasks you will initiate, etc. 

List all unresolved issues. 

7-230-50 How will we review your reports? 

A. We will verify and determine if you have complied with the following basic 

requirements: 
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1. We will ensure that your reports are timely.

2. We will validate that your report is mathematically accurate and that it is 

consistent with our drawdown records. 

3. We will validate your reported activities and accomplishments.

B. If we have any concerns, we will work with you to correct the reports. 

C. We will prepare a monitoring statement to document the review. 

D. We will update our program databases.
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CHAPTER 7-240

CLOSING A TECHNICAL STUDIES PROGRAM 

APPLIED SCIENCE COOPERATIVE AGREEMENT

7-240-00 What does this chapter do?

7-240-10 Where do these requirements come from?

7-240-20 When do we close out an applied science cooperative agreement?

7-240-30 When is your closeout package due?

7-240-40 How can you send your closeout package to us?

7-240-50 What information must you provide to close your cooperative agreement?

7-240-60 How will we review your reports and close your cooperative agreement? 

7-240-00 What does this chapter do?

This chapter explains to you, a recipient of an applied science cooperative agreement under our 

Technical Studies program, how to prepare and process your final reports. It also explains how

we, the Office of Surface Mining Reclamation and Enforcement (OSMRE), will close your 

cooperative agreement. 

7-240-10 Where do these requirements come from?

The requirements for closeout procedures come from the Uniform Administrative Requirements, 

Cost Principles, and Audit Requirements for Federal Awards, at 2 CFR Part 200, subpart D. 

7-240-20 When do we close out an applied science cooperative agreement?

A. The closeout process begins at the end of the performance period of your cooperative 

agreement. We will normally close your agreement within 180 calendar days after the 

end of the performance period.

B. We may close your cooperative agreement without audit. However, we reserve the right 

to take additional administrative action resulting from the findings of a subsequent audit.

C. We will not close your cooperative agreement until you have paid all allowable costs and 

we have deobligated any excess funding.

D. We will not close your agreement if it is in litigation or under appeal.

E. If we terminate your agreement for any reason, we will not close it until all termination 

actions have been completed.

7-240-30 When is your closeout package due?

A. Your closeout package is due to us 90 days after the end of the performance period of 

your cooperative agreement. 
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B. However, you may send us a written request with justification for an extension of the due 

date. If we approve your request, we may require you to submit interim performance and 

financial reports.

7-240-40 How can you send your closeout package to us?

You may send us your closeout package by e-mail or by regular mail. 

7-240-50 What information must you provide to close your cooperative agreement?

Your closeout package must include the following information. 

A. Final Federal Financial Report, on the SF 425 form, as described in Chapter 7-230.

B. Final narrative performance report, on the optional OSMRE 51 form or plain paper, as 

described in Chapter 7-230. 

C. You must include all project deliverables. Project deliverables are unique to each award. 

They may include a final technical report, information for a fact sheet, electronic 

presentations, workshop presentations, peer-reviewed papers, and technical conference 

presentations. We may provide formats which you must follow for your deliverable 

reports.

D. Report of Government Property, if you acquired or held any property under this 

cooperative agreement. Use the Tangible Personal Property Report (SF-428) that allows 

for any inventory format acceptable to our awarding office. If we provide any Federally 

owned property to you under this cooperative agreement, list it in your inventory 

separately from grant-purchased property.

E. List any in-kind services and materials you received that directly contributed to the 

completion of your project. Include the value of in-kind materials and services in this list 

and in the total expenditures on your financial report.

7-240-60 How will we review your reports and close your cooperative agreement? 

A. We will ensure that you have submitted complete and acceptable deliverables and 

reports. We will work with you to obtain missing or revised documents.

B. We will verify that we have added all changes into your cooperative agreement by 

appropriate revisions or amendments.

C. We will resolve with you any disputes, suspensions, withholding of funds, and violations 

of agreement clauses and assurances.
J-20

D. We will include a written evaluation of your performance under the cooperative 

agreement in our official file for this agreement.

E. We will approve the disposition of any property you may have purchased with 

cooperative agreement funds.

F. If you have any Federally owned property, we will reconcile it with our records.

G. We will deobligate any excess funds from your cooperative agreement.

H. We may use a closeout checklist to document our review and closeout actions. 

I. We will notify you in writing that your cooperative agreement is closed and remind you of 

our records retention and access requirements. See Chapter 2-260 for more information on 

record retention.
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CHAPTER 7-250

CLOSING A TECHNICAL STUDIES PROGRAM 

UNDERGROUND MINE MAP COOPERATIVE AGREEMENT

7-250-00 What does this chapter do?

7-250-10 Where do these requirements come from?

7-250-20 When do we close out an underground mine map cooperative agreement?

7-250-30 When is your closeout package due?

7-250-40 How can you send your closeout package to us?

7-250-50 What information must you provide to close your cooperative agreement?

7-250-60 How will we review your reports and close your cooperative agreement? 

7-250-00 What does this chapter do?

This chapter describes how you, a recipient of an underground mine map cooperative agreement 

under our Technical Studies program, should prepare and submit your final reports. It also 

explains how we the Office of Surface Mining Reclamation and Enforcement (OSMRE) will 

close your cooperative agreement. 

7-250-10 Where do these requirements come from?

The requirements for closeout procedures come from the Uniform Administrative Requirements, 

Cost Principles, and Audit Requirements for Federal Awards at 2 CFR 200, Subpart D. 

7-250-20 When do we close out an underground mine map cooperative agreement?

A. The closeout process begins at the end of the performance period of your cooperative

agreement. We will normally close your agreement within 180 calendar days after the 

end of the performance period.

B. We may close your cooperative agreement without audit. However, we reserve the right 

to take additional administrative action resulting from the findings of a subsequent audit.

C. We will not close your cooperative agreement until you have paid all allowable costs and 

we have deobligated any excess funding

D. We will not close your agreement if it is in litigation or under appeal.

E. If we terminate your agreement for any reason, we will not close it until all termination 

actions have been completed.

7-250-30 When is your closeout package due?

A. Your closeout package is due to us 90 days after the end of the performance period of 

your cooperative agreement. 
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B. However, you may send us a written request with justification for an extension of the due 

date. If we approve your request, we may require you to submit interim performance and 

financial reports.

7-250-40 How can you send your closeout package to us?

You may send us your closeout package by e-mail or by regular mail. 

7-250-50 What information must you provide to close your cooperative agreement?

Your closeout package must include the following information. 

A. Final Federal Financial Report, on the SF 425 form, as described in Chapter 7-230.

B. Final narrative performance report, on the optional OSMRE 51 form or plain paper, as 

described in Chapter 7-230. We will use your final report to promote our technology 

transfer efforts 

C. If any deliverables were required for your project, you must include them. They may 

include a final technical report, information for a fact sheet, and other materials. We may 

provide formats which you must follow for your deliverable reports.

D. Report of Government Property, if you acquired or held any property under this 

cooperative agreement. Use the Tangible Personal Property Report (SF-428) that allows 

for any inventory format acceptable to our awarding office. If we provide any federally 

owned property to you under this cooperative agreement, list it in your inventory 

separately from grant-purchased property.

7-250-60 How will we review your reports and close your cooperative agreement? 

A. We will verify that you completed the work as described in your proposal, and that it 

meets required quality standards.

B. We will ensure that you have submitted complete and acceptable documents. We will 

work with you to obtain missing or corrected documents.

C. We will verify that we have added all changes into your cooperative agreement by 

appropriate revisions or amendments.

D. We will resolve with you any suspensions, withholding of funds, disputes, and violations 

of agreement clauses and assurances.

E. We will include a written evaluation of your performance under the cooperative 

agreement in our official file for this agreement.
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F. We will approve the disposition of any property you may have purchased with 

cooperative agreement funds.

G. If you have any federally owned property, we will reconcile it with our records.

H. We will deobligate any excess funds from your cooperative agreement.

I. We may use a checklist to document our files. 

J. We will notify you in writing that your underground mine map cooperative agreement is 

closed and remind you of our records retention and access requirements.