1

DOD COMPONENT (NGB) COOPERATIVE AGEEEMENT GENERAL TERMS 

AND CONDITIONS

October 2023

SUBDIVISION A- Preamble

Part 1: Table of Contents

DOD COMPONENT (NGB) COOPERATIVE AGEEEMENT GENERAL TERMS AND 

CONDITIONS.......................................................................................................................... 1

SUBDIVISION A- Preamble..................................................................................................... 1

Part 1: Table of Contents........................................................................................................ 1

Part 2: Scope........................................................................................................................ 16

Section A. Introduction. .................................................................................................. 16

Section B. Applicability.................................................................................................... 16

Section C. Order of Precedence. ................................................................................... 17

Section D. Award Acceptance........................................................................................ 17

Part 3: English Language ..................................................................................................... 17

Part 4: Plain Language ......................................................................................................... 17

Part 5: Reserved Provisions ................................................................................................. 17

Part 6: Feedback on the Terms and Conditions ................................................................... 18

Part 7: Definitions ................................................................................................................. 18

Section A. Purpose of this Part. ..................................................................................... 18

Section B. Precedence of Definitions of Terms in National Policy Requirements. ......... 18

Section C. Definitions of Terms Used in The Federal Governmentwide Cost Principles or 

Single Audit Requirements.............................................................................................. 18
2

Section D. Definitions..................................................................................................... 19

SUBDIVISION B - General Terms and Conditions for Administrative Requirements ............ 25

Part 1: Financial and Program Management (Articles from this part are designated with 

“FMS” in the article title)......................................................................................................... 25

FMS Article I. Financial Management System Standards. ............................................. 25

Section A. System standard for States........................................................................... 25

Section B. System Standards for all Recipients. ............................................................ 25

Section C. Internal Controls. .......................................................................................... 26

FMS Article II. Payments................................................................................................ 26

Section A. Awards to States.......................................................................................... 26

Section B. Awards to Institutions of Higher Education, Nonprofit Organizations, Local 

Governments, Indian Tribes, and For-profit entities. ....................................................... 27

Section C. Electronic Funds Transfer and other Payment Procedural Instructions or 

Information. ..................................................................................................................... 29

FMS Article III. Allowable Costs, Period of Availability of Funds, and Fee or Profit........ 29

Section A. Allowable Costs. ........................................................................................... 29

Section B. Clarifications Concerning Charges for Professional Journal Publications. 

RESERVED – Not Applicable. ........................................................................................ 30

Section C. Period of Availability of Funds....................................................................... 30

Section D. Fee or Profit. ................................................................................................. 31

FMS Article IV. Revision of Budget and Program Plans................................................. 31

Section A. Approved Budget. ......................................................................................... 31

Section B. Revisions Requiring Prior Approval. ............................................................. 31

Section C. Pre-Award Costs........................................................................................... 32

Section D. Procedures. .................................................................................................. 33
3

FMS Article V. Non-Federal Audits................................................................................. 33

Section A. Requirements for Entities Subject to the Single Audit Act............................. 33

Section B. Requirements for For-Profit Entities.............................................................. 33

FMS Article VI. Cost Sharing or Matching....................................................................... 34

Section A. Required Cost Sharing or Matching. .............................................................. 34

Section B. Allowability as Cost Sharing or Matching. ...................................................... 34

Section C. Allowability of Unrecovered Indirect Costs as Cost Sharing or Matching. Not 

currently applicable to NGB - See CPP Guidance in Subdivision D of this document..... 35

Section D. Allowability of Program Income as Cost Sharing or Matching....................... 35

Section E. Valuation of Services or Property That You or Subrecipients Contribute or 

Donate............................................................................................................................. 35

Section F. Valuation of Third-Party In-Kind Contributions. ............................................. 36

FMS Article VII. Program Income................................................................................... 38

Section A. Definition. The term “program income” as used in NGB CA awards: ............ 38

Section B. Encouragement to Earn Program Income..................................................... 38

Section C. Costs of Generating Program Income........................................................... 38

Section D. License Fees and Royalties.......................................................................... 39

Section E. Use of Program Income. ............................................................................... 39

Section F. Duration of Accountability for Program Income.............................................. 39

Part 2: Property Administration (Articles from this part are designated with “PROP” in the 

article title) ............................................................................................................................. 39

PROP Article I. Title to Property..................................................................................... 39

Section A. Title to Property Acquired under NGB CA Awards........................................ 39

Section B. Property Trust Relationship........................................................................... 40
4

Section C. Federally Owned Property. ........................................................................... 40

Section D. Federal Interest in Donated Real Property or Equipment. ............................ 40

Section E. Federal Interest in Property Improved under the Award................................ 41

PROP Article II. Property Management System............................................................. 41

Section A. Insurance Coverage for Real Property and Equipment................................. 41

Section B. Other Management System Standards for a State. ....................................... 41

Section C. Other Management System Standards for an Institution of Higher Education, 

Nonprofit Organization, Local Government, Indian Tribe, For-profit entity. ..................... 42

PROP Article III. Use and Disposition of Real Property.................................................. 43

Section A. Use of Real Property..................................................................................... 43

Section B. Disposition of Real Property.......................................................................... 43

PROP Article IV. Use and Disposition of Equipment and Supplies. ............................... 44

Section A. Property Subject to This Article..................................................................... 44

Section B. Requirements for a State’s Use and Disposition of Equipment..................... 44

Section C. Use of Equipment by an Institution of Higher Education, Nonprofit 

Organization, Local Government, Indian Tribe, or For-profit Entity. ................................ 45

Section D. Disposition of Equipment by an Institution of Higher Education, Nonprofit 

Organization, Local Government, Indian Tribe, or For-profit Entity. ................................ 46

Section E. Use and Disposition of Supplies Acquired under NGB CA Awards............... 46

PROP Article V. Use and Disposition of Federally Owned Property............................... 47

Section A. Use................................................................................................................ 47

Section B. Disposition. ................................................................................................... 47

PROP Article VI. Intangible Property.............................................................................. 47

Section A. Assertion of Copyright................................................................................... 47
5

Section B. Inventions Developed under the Award. ....................................................... 47

Section C. Data Produced under the Award................................................................... 48

Section D. Use and Disposition of Intangible Property Acquired, but not Developed or 

Produced, under the Award............................................................................................. 49

Part 3: Procurement (Articles from this part are designated with “PROC” in the article title) 49

PROC Article I. Procurement Standards for States........................................................ 49

Section A. Use of State Procurement System................................................................ 49

Section B. Procurement of Recovered Materials............................................................ 49

Section C. Debarment and Suspension. ........................................................................ 50

Section D. Contract Provisions....................................................................................... 50

PROC Article II. Procurement Standards for Institutions of Higher Education, Nonprofit 

Organizations, Local Governments, Indian Tribes, and For-profit Entities. ..................... 50

Section A. General Procurement Standards. ................................................................. 50

Section B. Competition................................................................................................... 50

Section C. Procurement Methods................................................................................... 50

Section D. Contracting with Small and Minority Businesses, Women’s Business 

Enterprises, and Labor Surplus Area Firms. ................................................................... 50

Section E. Contract Cost and Price................................................................................ 50

Section F. Contract Provisions. ...................................................................................... 51

Section G. Procurement of Recovered Materials. .......................................................... 51

Section H. Review of Procurement Documents. ............................................................ 51

Section I. Domestic Preferences for Procurements........................................................ 51

Section J. Bonding Requirements. RESERVED - Only applicable if provided in awardspecific terms and conditions. ......................................................................................... 51

PROC Article III. Contract Provisions for Recipient Procurements. ...................................... 51
6

Section A. Contract Provisions for Administrative Requirements. ................................... 51

Section B. Contract Provisions for National Policy Requirements.................................. 53

Part 4: Reporting (Articles from this part are designated with “REP” in the article title)........ 55

REP Article I. Performance Management, Monitoring, And Reporting. .......................... 55

Section A. Required Reporting Form, Format, or Data Elements for Interim and Final 

Performance Reports. RESERVED - Language in award-specific terms and conditions.55

Section B. Frequency, Reporting Periods, and Due Dates for Interim Performance 

Reports. RESERVED - Language in award-specific terms and conditions. .................... 55

Section C. Due Date and Reporting Period for Final Performance Report..................... 56

Section D. Extensions of Due Dates. ............................................................................. 56

Section E. Reporting Significant Developments. ............................................................ 56

Section F. Performance Reporting Procedures. RESERVED - Language in awardspecific terms and conditions. ......................................................................................... 56

Section G. Site Visits...................................................................................................... 56

REP Article II. Financial Reporting. ................................................................................ 56

Section A. Required Reporting Form, Format, or Data Elements for Interim and Final 

Financial Reports. RESERVED - Language in award-specific terms and conditions. ..... 56

Section B. Interim Financial Reports: Frequency, Reporting Periods, and Due Dates. 

RESERVED - Language in award-specific terms and conditions.................................... 56

Section C. Final Financial Report................................................................................... 56

Section D. Extensions of Due Dates. ............................................................................. 57

Section E. Where and How to Submit Financial Reports. RESERVED - Language in 

award-specific terms and conditions. .............................................................................. 57

REP Article III. Reporting on Property............................................................................ 57

Section A. Real Property. ............................................................................................... 57

Section B. Equipment and Supplies. .............................................................................. 57
7

Section C. Federally Owned Property. ........................................................................... 58

Section D. Intangible Property........................................................................................ 59

REP Article IV. Reporting on Subawards and Executive Compensation........................ 59

Part 5: Other Administrative Requirements (Articles from this part are designated with “OAR” 

in the article title) ................................................................................................................... 59

OAR Article I. Submitting and Maintaining Recipient Information.................................... 59

Section A. System for Award Management..................................................................... 60

Section B. Reporting of Performance and Integrity Information. .................................... 60

Section C. Disclosure of Evidence of Integrity-Related Issues....................................... 62

OAR Article II. Records Retention and Access. ............................................................. 63

Section A. Records Retention Period............................................................................. 63

Section B. Extensions of Retention Period Due to Litigation, Claim, or Audit................. 64

Section C. Records for Program Income Earned After the End of the Performance 

Period.............................................................................................................................. 64

Section D. Records for Joint or Long-term Use.............................................................. 64

Section E. Methods for Collecting, Transmitting, and Storing Information...................... 64

Section F. Access to Records. ....................................................................................... 65

OAR Article III. Remedies and Termination.................................................................... 66

Section A. Noncompliance with Award Terms and Conditions....................................... 66

Section B. Remedies for Noncompliance....................................................................... 66

Section C. Termination................................................................................................... 67

Section D. Effects of Suspension or Termination of the Award on Allowability of Costs. 68

OAR Article IV. Claims, Disputes, and Appeals. ............................................................ 68
8

Section A. Definitions. .................................................................................................... 68

Section B. Submission of Claims..................................................................................... 69

Section C. Alternative Dispute Resolution...................................................................... 69

Section D. Grants Officer Decisions for Claims you Submit. .......................................... 69

Section E. Formal Administrative Appeals. .................................................................... 69

Section F. Representation.............................................................................................. 70

Section G. Non-exclusivity of Remedies. ....................................................................... 70

Section H. Effect of Grant Appeal Authority’s Decision. ................................................. 70

OAR Article V. Collection of Amounts Due..................................................................... 70

Section A. Establishing a Debt. ...................................................................................... 70

Section B. Debt Delinquency and Appeals..................................................................... 70

Section C. Demand Letter, Interest, and Debt Collection............................................... 71

OAR Article VI. Closeout................................................................................................ 71

Section A. Liquidation of Financial Obligations. ............................................................. 71

Section B. Refunds of Unobligated Balances................................................................. 71

Section C. Final Reports. ............................................................................................... 72

Section D. Accounting for Property. ............................................................................... 72

Section E. Delinquent Final Reports and Timeframe for Closeout. ................................ 72

OAR Article VII. Post-Closeout Adjustments and Continuing Responsibilities. .............. 73

Section A. Adjustments. ................................................................................................. 73

Section B. Continuing Responsibilities........................................................................... 73

Part 6: Subawards (Articles from this part are designated with “SUB” in the article title)...... 73
9

SUB Article I. Distinguishing Subawards and Procurements.......................................... 73

Section A. Required Recipient Determination. ............................................................... 73

Section B. Considerations in Making the Determination.................................................. 73

Section C. Effect of the Determination on the Next-Tier Transaction. ............................ 74

SUB Article II. Pre-award and Time of Award Responsibilities....................................... 75

Section A. Requirements for Unique Entity Identifiers.................................................... 75

Section B. Pre-award Risk Assessment.......................................................................... 75

Section C. Subaward Content. ....................................................................................... 76

Section D. Subaward and Executive Compensation Reporting...................................... 77

SUB Article III. Informational Content of Subawards...................................................... 77

Section A. Informational Content in General. ................................................................. 77

Section B. Federal Award Identification Number and Award Date. ................................ 77

Section C. Amount of Federal Funds Obligated. ............................................................ 77

Section D. Total Amount Obligated to the Subrecipient. ................................................ 77

Section E. Total Amount of the Federal Award. ............................................................. 78

Section F. Federal Awarding Agency, Pass-Through Entity, and Awarding Official. ...... 78

Section G. Indirect Cost Rate. RESERVED – Not currently applicable to NGB - See 

Subdivision D of this document. ...................................................................................... 78

SUB Article IV. Financial and Program Management Requirements for Subawards. .... 78

Section A. Purposes of this Article in Relation to other Articles...................................... 78

Section B. Financial Management System Standards.................................................... 78

Section C. Payments...................................................................................................... 79

Section D. Allowable Costs, Period of Availability of Funds, and Fee and Profit............ 80
10

Section E. Revision of budget and program plans.......................................................... 80

Section F. Non-Federal audits........................................................................................ 80

Section G. Cost sharing or matching requirements........................................................ 81

Section H. Program Income. .......................................................................................... 81

SUB Article V. Property Requirements for Subawards................................................... 82

Section A. Purposes of this Article in Relation to other Articles...................................... 82

Section B. Title to Property.............................................................................................. 82

Section C. Property Management System. .................................................................... 82

Section D. Use and Disposition of Real Property. .......................................................... 83

Section E. Use and Disposition of Equipment and Supplies. ......................................... 83

Section F. Use and Disposition of Federally Owned Property........................................ 84

Section G. Intangible Property. ...................................................................................... 84

SUB Article VI. Procurement Procedures to Include in Subawards................................ 84

Section A. Purposes of this Article in Relation to other Articles...................................... 84

Section B. Subaward to a State. ..................................................................................... 84

Section C. Subaward to an Institution of Higher Education, Nonprofit Organization, Local 

Government, Indian Tribe, or For-profit Entity. ................................................................ 84

SUB Article VII. Financial, Programmatic, And Property Reporting Requirements for 

Subawards. ..................................................................................................................... 85

Section A. Purposes of this Article in Relation to other Articles...................................... 85

Section B. Performance Reporting................................................................................. 85

Section C. Financial Reporting....................................................................................... 86

Section D. Reporting on Property................................................................................... 86
11

SUB Article VIII. Other Administrative Requirements for Subawards............................. 86

Section A. Purposes of this Article in Relation to other Articles...................................... 86

Section B. Submission and Maintenance of Subrecipient Information. .......................... 86

Section C. Records Retention and Access..................................................................... 87

Section D. Remedies and Termination........................................................................... 87

Section E. Disputes, Hearings, and Appeals.................................................................. 88

Section F. Collection of Amounts Due............................................................................ 88

Section G. Closeout. ...................................................................................................... 88

Section H. Post-Closeout Adjustments and Continuing Responsibilities........................ 89

SUB Article IX. National Policy Requirements for Subawards........................................ 89

Section A. General. ........................................................................................................ 89

Section B. Nondiscrimination National Policy Requirements.......................................... 89

Section C. Environmental National Policy Requirements............................................... 90

Section D. National Policy Requirements Concerning Live Organisms. RESERVED –Not 

applicable. ....................................................................................................................... 90

Section E. Other National Policy Requirements. ............................................................ 90

SUB Article X. Subrecipient Monitoring and other Post-Award Administration............... 90

Section A. General Requirement for Subrecipient Monitoring........................................ 90

Section B. Subrecipient Monitoring Actions.................................................................... 91

Section C. Remedies and Subaward Suspension or Termination.................................. 91

Section D. Subaward Closeout....................................................................................... 92

SUB Article XI. Requirements Concerning Subrecipients’ Lower-tier Subawards.......... 92

Section A. Purpose......................................................................................................... 92
12

Section B. Requirements for Lower-tier Subawards....................................................... 92

SUB Article XII. Fixed Amount Subawards..................................................................... 93

Section A. Limitations on Use. ....................................................................................... 93

Section B. Fixed Amount Subawards that do not Require Prior Approval...................... 94

Section C. Informational Content of Fixed Amount Subawards...................................... 95

Section D. Terms and Conditions Addressing Administrative Requirements. ................ 96

Section E. National Policy Requirements for Fixed Amount Subawards........................ 98

Section F. Subrecipient Monitoring and Other Post-Award Administration..................... 98

Section G. Fixed amount subawards at Lower Tiers...................................................... 98

SUBDIVSION C - General Terms and Conditions for National Policy Requirements............ 99

Part 1: National Policy Requirements (Articles from this part are designated with “NP” in the 

article title) ............................................................................................................................. 99

NP Article I. Nondiscrimination National Policy Requirements. ...................................... 99

Section A. Cross-Cutting Nondiscrimination Requirements. .......................................... 99

Section B. Other Nondiscrimination Requirements. RESERVED - Only applicable if 

provided in award-specific terms and conditions............................................................. 99

NP Article II. Environmental National Policy Requirements........................................... 100

Section A. Cross-Cutting Environmental Requirements................................................ 100

Section B. Other Environmental Requirements. RESERVED - Only applicable if 

provided in award-specific terms and conditions........................................................... 101

NP Article III. National Policy Requirements Concerning Live Organisms. RESERVED –

Not Applicable. .............................................................................................................. 101

NP Article IV. Other National Policy Requirements. ..................................................... 101

Section A. Cross-Cutting Requirements....................................................................... 101

Section B. Additional Requirements............................................................................. 106
13

SUBDIVISION D - General Terms and Conditions for Programmatic Requirements. ......... 108

Part 1: Authorities ............................................................................................................... 108

Section A. General Authority. ....................................................................................... 108

Section B. Other Specific Authorities............................................................................ 108

Part 2: NGB Definitions....................................................................................................... 108

Section A. Airport Authority. ......................................................................................... 108

Section B. Air National Guard. ..................................................................................... 108

Section C. Army National Guard. ................................................................................. 109

Section D. Army National Guard and Air National Guard Cooperative Agreement Award.

...................................................................................................................................... 109

Section E. Chief, National Guard Bureau..................................................................... 109

Section F. Centralized Personnel Plan......................................................................... 109

Section G. Federal Fiscal Year. ................................................................................... 109

Section H. Grant Appeal Authority................................................................................ 109

Section I. In-Kind Assistance........................................................................................ 109

Section J. In-Kind Contribution..................................................................................... 110

Section K. Military Equipment. ..................................................................................... 110

Section L. National Guard Bureau................................................................................ 110

Section M. Principal Investigator. ................................................................................. 110

Section N. Renewal Award............................................................................................ 110

Section O. State. .......................................................................................................... 110

Section P. The Adjutant General.................................................................................. 111

Section Q. United States Property and Fiscal Officer................................................... 111
14

Part 3: NGB General Provisions ......................................................................................... 111

Section A. Successors and Assigns............................................................................. 111

Section B. Entire Agreement. ....................................................................................... 111

Section C. Severability. ................................................................................................ 111

Section D. Waiver of Breach. ....................................................................................... 112

Section E. Notices........................................................................................................ 112

Section F. Liabilities and Indemnity.............................................................................. 112

Section G. Government Furnished Equipment (GFE). ................................................. 112

Part 4: Legal Authorities ..................................................................................................... 112

Section A. Legal Authority. ........................................................................................... 112

Section B. Opinion of Counsel. .................................................................................... 113

Part 5: Responsibilities of Parties ........................................................................................ 113

Section A. National Guard Bureau (NGB) Responsibilities. ......................................... 113

Section B. Recipient Responsibilities and Compliance with Federal Requirements..... 114

Part 6: Period of Performance of Cooperative Agreement Awards (Articles from this part are 

designated with “POP” in the article title)............................................................................. 115

POP Article I. Period of Performance............................................................................ 115

Section A. Opening of a new NGB Cooperative Agreement Award .............................. 115

Section B. Duration of the Period of Performance (PoP)............................................... 115

Section C. Period of Performance Exceptions. ............................................................. 116

POP Article II. Use of Renewal Awards......................................................................... 116

Part 7: Payments ................................................................................................................ 117

Payment Method, Timing, and Amounts. ...................................................................... 117
15

Part 8: Authorized Charges ................................................................................................ 117

Personnel. ..................................................................................................................... 117

Part 9: Centralized Personnel Plan (CPP)........................................................................... 118

Section A. CPP............................................................................................................. 118

Section B. Responsibilities. .......................................................................................... 119

Section C. State Central Services Cost Allocation Plan (CSCAP) ............................... 119

Part 10: Program Income..................................................................................................... 120
16

Part 2: Scope

Section A. Introduction.

NGB CA awards are subject to the following Department of Defense (DoD) General 

Terms and Conditions These general terms and conditions implement Office of 

Management and Budget (OMB) guidance, “Uniform Administrative Requirements, Cost 

Principles, and Audit Requirements for Federal Awards,” published in the Code of 

Federal Regulations (CFR) at 2 CFR part 200 and implemented by the DoD at 2 CFR 

part 1104, “Interim Grants and Cooperative Agreements Implementation of Guidance in 

2 CFR part 200” (79 FR 76047, December 19, 2014, as amended at 85 FR 49506, 

August 13, 2020).

Section B. Applicability.

1. These general terms and conditions apply to the National Guard Bureau (NGB), a DoD 

Component, cooperative agreements with institutions of higher education, nonprofit 

organizations, states, local governments, Indian tribes, and for-profit entities. They also 

apply when incorporated into NGB cooperative agreements subcontracts and sub 

awards with foreign organizations or foreign public entities (as defined in 2 CFR 1108). 

These general terms and conditions do not apply to NGB grants and cooperative 

agreements made directly to individuals. Certain provisions within these general terms 

and conditions may indicate that they apply to certain types of recipients only. An 

example of this is FMS Article V for non-federal audits.

2. Certain provisions within these general terms and conditions may indicate that they 

apply to certain types of recipients only. An example of this is FMS Article V for nonfederal audits.

Organization Type Applicable Administrative Requirements

Domestic Non-federal entity (including state, 

local government, Indian tribe, institution of 

higher education (IHE), or nonprofit 

organization)

• 2 CFR 200: Subparts A through F

• 2 CFR 600 & 601

Foreign Non-Profit Organization • 2 CFR 200: Subparts A through E

• 2 CFR 600 & 601

Domestic & Foreign For-Profit Organization • 2 CFR 200: Subparts A through D

• 2 CFR 600 & 601

• 48 CFR Part 30 & 31

Individuals • None

Foreign Public Entities (Includes Public 

International Orgs)

• None
17

Section C. Order of Precedence.

Any inconsistencies in the requirements of a NGB CA awards will be resolved in the 

following order:

a. Federal statutes.

b. Federal regulations* not otherwise referenced herein.

c. Cooperative Agreement Award-specific terms and conditions.

d. General Terms and Conditions, which includes the DoD Component (NGB)’s 

Addendum to this document (Subdivision D).

Section D. Award Acceptance.

If you receive an unsigned award from NGB, that means that you are required to sign 

the award to indicate acceptance of the award, including the terms and conditions, prior 

to initiating performance. The grants officer will sign the award upon receipt of your 

signature.

Part 3: English Language

You must translate any of the award content (including attachments to it and any 

material incorporated into the award by reference) into another language only to the 

extent that your compliance with the award’s terms and conditions depends upon a 

significant number of your employees who are not fluent in English being able to read 

and comprehend that content. If you translate any award content into another 

language, the original award content in the English language will take precedence in the 

event of an inconsistency between the award requirements in the English and translated 

versions.

Part 4: Plain Language

These general terms and conditions use plain language, with use of personal pronouns 

such as “you” to denote the recipient and “we” to mean the Federal Government 

(Government). Use of personal pronouns is a recognized means to help a reader 

understand to whom the language is addressed and assist in determining 

responsibilities.

Part 5: Reserved Provisions
18

If the words “RESERVED – Not Applicable” are used at the section or section level of 

an article without additional explanation, it means that this particular section or section

does not apply in any manner to NGB CA awards. If the word “RESERVED” is used 

with additional explanation (in bold red colored font), it will describe whether the 

particular provisions either will or may be included in a DoD Component (NGB) 

addendum (Subdivision D) to these terms and conditions.

Part 6: Feedback on the Terms and Conditions

As you gain operating experience with these general terms and conditions, you may 

find areas requiring clarification or correction. Alerting us to potential issues will help 

us improve both these general terms and conditions and NGB’s regulatory 

implementation of the OMB guidance at 2 CFR part 200.

Part 7: Definitions

Section A. Purpose of this Part.

This part provides definitions of terms used in the DoD Component (NGB) General 

Terms and Conditions.

Section B. Precedence of Definitions of Terms in National Policy Requirements.

Part 7 of these general terms and conditions may use a term in relation to compliance 

with a national policy requirement in a statute, Executive order, or other source that 

defines the term differently than it is defined in Section D of this part. For purposes of 

that particular national policy requirement, the definition of a term provided by the 

source of the requirement and any regulation specifically implementing it takes 

precedence over the definition in this part.

Section C. Definitions of Terms Used in The Federal Governmentwide Cost Principles 

or Single Audit Requirements.

1. Some award provisions state that you must comply with single audit or cost principles 

requirements in a governmentwide issuance and include the requirements by reference 

to the issuance without restating them. For any term defined in one of those issuances, 

this part includes the definition only if the term is used in these general terms and 

conditions.

2. Otherwise, this part does not include a definition and a user of these terms and 

conditions should consult definitions in the pertinent Governmentwide source, as 

follows:
19

a. The requirements for audits of recipients and subrecipients that are in Subpart F of 

OMB guidance in 2 CFR part 200, which implements the Single Audit Act.

b. The governmentwide cost principles for institutions of higher education, nonprofit 

organizations, states, local governments, and Indian tribes that are contained in 

Subpart E of OMB guidance in 2 CFR part 200.

c. The cost principles for for-profit entities at Subpart 31.2 of the Federal Acquisition 

Regulation (48 CFR part 31), as supplemented by provisions of the Defense 

Federal Acquisition Regulation Supplement at Subpart 231.2 of 48 CFR part 231.

Section D. Definitions.

1. Acquire. See 2 CFR 1108.10.

2. Acquisition. See 2 CFR 1108.15.

3. Acquisition Cost. See 2 CFR 1108.20.

4. Administrative Offset. See 2 CFR 1108.25.

5. Advance Payment. See 2 CFR 1108.30.

6. Advanced Research. RESERVED – Not Applicable.

7. Applied Research. RESERVED – Not Applicable.

8. Approved Budget. See 2 CFR 1108.50.

9. Assistance. See 2 CFR 1108.55.

10. Award. See 2 CFR 1108.60.

11. Award Administration Office. See 2 CFR 1108.65.

12. Basic Research. RESERVED – Not Applicable.

13. Budget Period. See 2 CFR 200.1.

14. Capital Asset.

a. Tangible or intangible assets used in operations having a useful life of more than 

one year which are capitalized in accordance with Generally Accepted Accounting 

Principles (GAAP). Capital assets include. See also 2 CFR 1108.75:

(1) Land, buildings (facilities), equipment, and intellectual property (including 

software) whether acquired by purchase, construction, manufacture, exchange, 

or through a lease accounted for as financed purchase under Government 
20

Accounting Standards Board (GASB) standards or a finance lease under 

Financial Accounting Standards Board (FASB) standards; and

(2) Additions, improvements, modifications, replacements, rearrangements, 

reinstallations, renovations, or alterations to capital assets that materially 

increase their value or useful life (not ordinary repairs and maintenance).

b. For purpose of this Part, capital assets do not include intangible right-to-use assets 

(per GASB) and right-to-use operating lease assets (per FASB). For example, 

assets capitalized that recognize a lessee’s right to control the use of property 

and/or equipment for a time under a lease contract. See also §200.465.

15. Claim. See 2 CFR 1108.80.

16. Cognizant Agency for Indirect Costs. - RESERVED 

17. Contract. See 2 CFR 1108.90.

18. Contractor. See 2 CFR 1108.105.

19. Cooperative Agreement. See 2 CFR 1108.110.

20. Co-Principal Investigator. RESERVED – Not Applicable.

21. Cost Allocation Plan. See 2 CFR 1108.120.

22. Cost Sharing or Matching. See 2 CFR 1108.125.

23. Cost-Type Contract. See 2 CFR 1108.130.

24. Cost-Type Subaward. See 2 CFR 1108.35.

25. Debarment. See 2 CFR 1108.140.

26. Debt. See 2 CFR 1108.145.

27. Delinquent Debt. See 2 CFR 1108.150.

28. Development. RESERVED – Not Applicable.

29. Direct Costs. See 2 CFR 1108.160.

30. DoD Components. See 2 CFR 1108.165.

The Office of the Secretary of Defense; the Military Departments; the National Guard 

Bureau; and all Defense Agencies, DoD Field Activities, and other organizational 

entities within the DoD that are authorized to award or administer grants, cooperative 

agreements, and other non-procurement instruments.
21

31. Equipment. See 2 CFR 1108.170, See also 2 CFR 200.313.

32. Exempt Property. See 2 CFR 1108.175.

33. Expenditures. See 2 CFR 1108.180.

34. Federal Interest.

Federal Interest means, in relation to real property, equipment, or supplies acquired 

or improved under an award or subaward, the dollar amount that is the product of the:

(1) Federal share of total project costs.

(2) The percentage of federal participation in the total costs of the real property, 

equipment, or supplies.

(3) Current fair market value of the property, improvements, or both, to the extent 

the costs of acquiring or improving the property were included as project 

costs.

35. Federal Share. See 2 CFR 1108.190.

36. Fixed Amount Subaward. See 2 CFR 1108.200.

37. Foreign Organization. See 2 CFR 1108.205.

38. Foreign Public Entity. See 2 CFR 1108.210.

39. Grant. See 2 CFR 1108.215.

40. Grants Officer. See 2 CFR 1108.220.

41. Indian Tribe. See 2 CFR 1108.225.

42. Indirect Costs (also known as “Facilities and Administrative,” or F&A, costs). 

RESERVED – Not currently applicable to NGB - See CPP Guidance in 

Subdivision D of this document.

43. Institution Of Higher Education. See 2 CFR 1108.235.

44. Intangible Property. See 2 CFR 1108.240.

45. Local Government. See 2 CFR 1108.245.

46. Management Decision. See 2 CFR 1108.250.

47. Nonprocurement Instrument. See 2 CFR 1108.255.
22

48. Nonprofit Organization. See 2 CFR 1108.260.

49. Obligation. See 2 CFR 1108.265.

50. Office Of Management and Budget. See 2 CFR 1108.270.

51. Outlays. See 2 CFR 1108.275.

52. Participant Support Costs. See 2 CFR 1108.280.

53. Period Of Performance. See 2 CFR 1108.285, See also Subdivision D.

54. Personal Property. See 2 CFR 1108.290.

Property other than real property. It may be tangible, having physical existence, or 

intangible, such as copyrights, patents, and securities.

55. Principal Investigator. See 2 CFR 1108.295, Also See Subdivision D.

56. Prior Approval. See 2 CFR 1108.298

57. Procurement Contract. See 2 CFR 1108.300.

Legal instrument which, consistent with 31 U.S.C. 6303, reflects a relationship 

between the Federal Government and a state, a local government, or other recipient 

when the principal purpose of the instrument is to acquire property or services for the 

direct benefit or use of the Federal Government. A procurement contract is a primetier transaction and therefore distinct from a recipient’s or subrecipient’s “procurement 

transaction” or “contract” as defined in this part.

58. Procurement Transaction. See 2 CFR 1108.2305.

Legal instrument by which a recipient or subrecipient purchases property or services 

it needs to carry out the project or program under its award or subaward, 

respectively. A procurement transaction is distinct both from “subaward” and 

“procurement contract,” as those terms are defined in this part.

59. Program Income. See 2 CFR 1108.310.

60. Project Costs. See 2 CFR 1108.315.

61. Property. See 2 CFR 1108.320.

62. Real Property. See 2 CFR 1108.325.

63. Recipient. See 2 CFR 1108.330.

An entity that receives an award directly from NGB. The term does not include 
23

subrecipients.

64. Research. RESERVED – Not Applicable.

65. Simplified Acquisition Threshold. See 2 CFR 1108.340.

66. State. 2 CFR 1108.350, See also Subdivision D.

State for purposes of applying the administrative requirements in these regulations, 

means any state of the United States, the District of Columbia, the Commonwealth of 

Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, the Commonwealth of 

the Northern Mariana Islands, and any agency or instrumentality thereof exclusive of 

local governments.

67. Subaward. 2 CFR 1108.355.

Legal instrument by which a recipient or subrecipient at any tier, transfers--for 

performance by an entity at the next lower tier--a portion of the substantive program 

for which the DoD Component (NGB) made an award.

68. Subrecipient. 2 CFR 1108.360.

An entity that receives a subaward.

69. Supplies. 2 CFR 1108.365.

70. Suspension. 2 CFR 1108.370.

Suspension means either:

(1) When used in the context of a specific award or subaward, the temporary 

withdrawal of authority for the recipient or subrecipient to obligate funds under 

the award or subaward, pending it is taking corrective action or a decision to 

terminate the award or subaward.

(2) When used in the context of an entity, an action by a DoD Component

(NGB)’s suspending official under 2 CFR part 1125, DoD (NGB)’s regulation 

implementing OMB guidance on nonprocurement debarment and suspension 

in 2 CFR part 180, to immediately exclude the entity from participating in 

covered Federal Government transactions, pending completion of an 

investigation and any legal or debarment proceedings that ensue.

71. Termination. 2 CFR 1108.380.

The ending of an award or subaward, in whole or in part, at any time prior to the 

planned end of the period of performance. A lack of available funds is not a 

termination.
24

72. Third-Party In-Kind Contribution. 2 CFR 1108.385.

The value of a non-cash contribution (i.e., property or services) that: 

(1) A non-federal third party contributes, without charge, either to a recipient or 

subrecipient at any tier under NGB’s award.

(2) Is identified and included in the approved budget of NGB’s award, as a 

contribution being used toward meeting the award’s cost sharing or matching 

requirement (which includes voluntary committed, but not voluntary 

uncommitted, contributions).

73. Total Value. 2 CFR 1108.390.

74. Unique Entity Identifier. 2 CFR 1108.395.

The identifier required for System for Award Management registration to uniquely 

identify entities with which the Federal Government does business (formerly the Dun 

and Bradstreet Data Universal Numbering System, or DUNS number).

75. Unobligated Balance. 2 CFR 1108.400.

76. Voluntary (Committed or Uncommitted) Cost Sharing. 2 CFR 1108.405.

77. Working Capital Advance. 2 CFR 1108.410.

A payment method under which funds are advanced to a recipient or subrecipient to 

cover its estimated disbursement needs for a given initial period, after which payment 

is made by way of reimbursement.
25

SUBDIVISION B - General Terms and Conditions for Administrative 

Requirements

Part 1: Financial and Program Management (Articles from this part are 

designated with “FMS” in the article title)

FMS Article I. Financial Management System Standards. 

Section A. System standard for States. 

As a State, you must expend and account for funds under NGB CA awards in 

accordance with:

a. Applicable State laws.

b. To the extent they comply with the requirements of Section B of this article, your 

procedures for expending and accounting for your own state funds.

Section B. System Standards for all Recipients. 

1. Your financial management system must provide for:

a. Inclusion, in your accounts, of the following information about each NGB grant or 

cooperative agreement that you receive:

(1) That you received the award from NGB.

(2) The number and title listed in the Assistance for NGB program under which 

the award was made.

(3) NGB CA award number.

(4) The year (your fiscal year) in which you received the award.

b. Accurate, current, and complete disclosure of the financial results of the award 

needed to comply with financial and programmatic reporting requirements that are 

specified in REP Articles I and II of these general terms and conditions, as 

supplemented by any award-specific terms and conditions of an NGB CA award

concerning reporting requirements. If you are asked at any time under an award

to report financial information on an accrual basis, you:

(1) Need not establish an accrual accounting system if you maintain your records 

on a different basis.
26

(2) May develop the accrual data based on an analysis of the data you have on 

hand.

2. Records that identify adequately the sources of funds for all activities funded by an

NGB CA award, including any required cost sharing or matching, and the application of 

those funds. This includes funding authorizations; your financial obligations and 

expenditures of the funds; unobligated balances; property and other assets under the 

award; program income; and interest.

3. Effective control over, and accountability for, all funds, property, and other assets 

under NGB CA awards. You must adequately safeguard all assets and assure they 

are used solely for authorized purposes (see Section C of this article for additional 

requirements concerning internal controls).

4. Comparison of expenditures under NGB CA awards for project or program purposes 

with amounts in the approved budget for those purposes.

5. RESERVED – Not Applicable.

6. Written procedures:

a. To implement requirements specified in FMS Article II, “Payments;”

b. For determining the allowability of costs, which for an NGB CA award are 

determined in accordance with FMS Article III, “Allowable costs, period of 

availability of funds, and fee or profit,” of these general terms and conditions, as 

supplemented by any award-specific terms and conditions of an NGB CA award

that relate to allowability of costs.

Section C. Internal Controls. 

Your system of internal controls must conform to OMB guidance in 2 CFR 200.303. 

With respect to paragraph (e) of 2 CFR 200.303, your internal control system must 

include measures to safeguard any information that federal statute, Executive order, or 

regulation requires to be protected (e.g., personally identifiable or export-controlled

information), whether generated under the award or provided to you and identified as 

being subject to protection.

FMS Article II. Payments. 

Section A. Awards to States. 

1. If the award-specific terms and conditions of an NGB CA award do not identify it as an 

award subject to Subpart A of 31 CFR part 205 (Department of the Treasury regulations 

implementing the Cash Management Improvement Act), then a NGB CA award is 

subject to Subpart B of that part. Consistent with Subpart B of 31 CFR part 205.

2. Payment Method, Timing, and Amounts (see also Subdivision D). You must:
27

a. Minimize the time between your receipt of a payment under an NGB CA award and 

your disbursement of those funds for project or program purposes.

b. Limit the amount of each payment request to the minimum amount you need to meet 

your actual, immediate cash requirements for carrying out the project or program.

c. Submit each advance payment request approximately 10 days before you anticipate 

disbursing the requested amount for project or program purposes, so that your 

receipt of the funds will be as close in time as is administratively feasible to your 

actual cash outlay for direct project or program costs and the proportionate share of 

any allowable indirect costs.

3. Interest. Unlike awards subject to Subpart A of 31 CFR part 205, neither you nor we will 

incur any interest liability due to a difference in timing between your receipt of payments 

under an NGB CA award and your disbursement of those funds for project or program 

purposes.

Section B. Awards to Institutions of Higher Education, Nonprofit Organizations, Local 

Governments, Indian Tribes, and For-profit entities.

1. Payment method. RESERVED – Standard payment for NGB grants and 

cooperative agreements is by reimbursement. Advance allowable as per policy 

as described in Subdivision D of this document.

2. Amounts Requested. You must:

a. Limit the amount of any advance payment request to the minimum amount needed 

to meet your actual, immediate cash requirements for carrying out the purpose of the 

approved project or program, including direct project costs and a proportionate share 

of any allowable indirect costs.

b. Exclude from any payment request amounts you are withholding from payments to 

contractors to assure satisfactory completion of the work. You may request those 

amounts when you make the payments to the contractors or to escrow accounts 

established to assure satisfactory completion of the work.

c. Exclude from any payment request amounts from any of the following sources that 

are available to you for project or program purposes under an NGB CA award: 

program income, including repayments to a revolving fund; rebates; refunds; 

contract settlements; audit recoveries; and interest earned on any of those funds. 

You must disburse those funds for project or program purposes before requesting 

additional funds from us.

3. Timing of Requests. For any advance payment you request, you should submit the 

request approximately 10 days before you anticipate disbursing the requested amount 

for project or program purposes. With time for agency processing of the request, that 

should result in payment as close as is administratively feasible to your actual 
28

disbursements for project or program purposes.

4. Frequency of Requests. You may request payments as often as you wish unless you 

have been granted a waiver from requirements to receive payments by electronic funds 

transfer (EFT). If you have been granted a waiver from EFT requirements, the awardspecific terms and conditions of an NGB CA award specify the frequency with which 

you may submit payment requests.

5. Withholding of Payments. We will withhold payments for allowable costs under the 

award at any time during the period of performance only if one or more of the following 

applies:

a. We suspend either payments or the award, or disallow otherwise allowable costs, as 

a remedy under OAR Article III due to your failure to comply with federal statutes, 

regulations, or the terms and conditions of an NGB CA award. If we suspend 

payments and not the award, we will release withheld payments upon your 

subsequent compliance. If we suspend the award, then amounts of payments are 

subject to adjustment in accordance with the terms and conditions of OAR Article B. 

b. You are delinquent in a debt to the United States, in which case we may, after 

reasonable notice,inform you that we will not make any further payments for costs 

you incurred after a specified date until you correct the conditions or liquidate the 

indebtedness to the Federal Government.

c. The award-specific terms and conditions include additional requirements that provide 

for withholding of payments based on conditions identified during our pre-award risk 

evaluation, in which case you should have been notified about the nature of those 

conditions and the actions needed to remove the additional requirements.

6. Depository Requirements.

a. There are no eligibility requirements for depositories you use for funds you receive 

under NGB CA awards.

b. You are not required to deposit funds you receive under NGB CA awards in a 

depository account separate from accounts in which you deposit other funds. 

However, FMS Article I requires that you be able to account for the receipt, 

obligation, and expenditure of all funds under NGB CA awards.

c. You must deposit any advance payments of funds you receive under NGB CA 

awards in insured accounts whenever possible and, unless any of the following 

apply, you must deposit them in interest-bearing accounts:

(1) You receive a total of less than $250,000 per year under federal grants and 

cooperative agreements.

(2) You would not expect the best reasonably available interest-bearing account 

to earn interest in excess of $500 per year on your cash balances of advance 

payments under federal grants and cooperative agreements.
29

(3) The best reasonably available interest-bearing account would require you to 

maintainan average or minimum balance higher than it would be feasible for 

you to do within your expected federal and non-Federal cash balances.

(4) A foreign government or banking system precludes your use of interestbearing accounts.

d. You may retain for administrative expenses up to $500 per year of interest that you 

earn in the aggregate on advance payments you receive under NGB CA awards and 

other federal grants and cooperative agreements. You must remit annually the rest 

of the interest to the Department of Health and Human Services, using the 

procedures set forth in OMB guidance in 2 CFR 200.305(b)(9).

Section C. Electronic Funds Transfer and other Payment Procedural Instructions or 

Information.

1. Electronic Funds Transfer. Unless the award-specific terms and conditions of NGB 

CA awards provide otherwise, you will receive payments under NGB CA awards by 

electronic funds transfer.

2. RESERVED – Not Applicable.

FMS Article III. Allowable Costs, Period of Availability of Funds, and Fee or Profit. 

Section A. Allowable Costs. 

1. This section, with the clarification provided in Section B, specifies which federal cost 

principles must be used in determining the allowability of costs charged to NGB CA 

awards, a subrecipient’s costs charged to any cost-type subaward that you make under

NGB CA awards, and a contractor’s costs charged to any cost-type procurement 

transaction into which you enter under NGB CA awards. These cost principles also 

govern the allowable costs that you or a subrecipient of a subaward at any tier below 

NGB CA awards may consider when establishing the amount of any fixed-amount 

subaward or fixed-price procurement transaction at the next lower tier. The set of cost 

principles to be used in each case depends on the type of entity incurring the cost 

under the award, subaward, or contract.

2. General Case. If you, your subrecipient, or your contractor is:

a. An Institution of Higher Education, the allowability of costs must be determined in 

accordance with provisions of Subpart E of OMB guidance in 2 CFR part 200 other 

than 2 CFR 200.400(g), supplemented by appendix III to that part.

b. A Hospital, the allowability of costs must be determined in accordance with 

provisions of appendix IX to 2 CFR part 200, which currently specifies the cost 

principles in appendix IX to 45 CFR part 75 as the applicable cost principles.
30

c. A Nonprofit Organization other than a Hospital or Institution of Higher 

Education, the allowability of costs must be determined in accordance with 

provisions of Subpart E of OMB guidance in 2 CFR part 200 other than 2 CFR 

200.400(g), supplemented by appendices IV and VIII to that part. In accordance 

with guidance in 2 CFR 200.401(c), a nonprofit organization listed in appendix VIII 

to 2 CFR part 200 is subject to the cost principles for for-profit entities specified in 

paragraph 1.e of this section.

d. A State, Local Government, or Indian Tribe, the allowability of costs must be 

determined in accordance with applicable provisions of Subpart E of OMB guidance 

in 2 CFR part 200 other than 2 CFR 200.400(g), supplemented by appendices V 

through VII to that part.

e. A for-Profit Entity (Other Than a Hospital) or a Nonprofit Organization Listed 

in Appendix VIII To 2 CFR Part 200:

(1) The allowability of costs must be determined in accordance with:

(a) The cost principles for commercial organizations in the Federal 

Acquisition Regulation (FAR) at Subpart 31.2 of 48 CFR part 31, as 

supplemented by provisions of the Defense Federal Acquisition 

Regulation Supplement (DFARS) at Subpart 231.2 of 48 CFR part 231.

(b) For a for-profit entity, the additional provisions on allowability of audit 

costs, in 32 CFR 34.16(f).

(2) The indirect cost rate to use in that determination is:

(a) The for-profit entity’s federally negotiated indirect cost rate if it has one.

(b) Subject to negotiation between you and the for-profit entity if it does not 

have a federally negotiated indirect cost rate. The rate that you negotiate 

may provide for reimbursement only of costs that are allowable in 

accordance with the cost principles specified in paragraph A.1.e.(1) of 

this article.

3. Exception. You may use your own cost principles in determining the allowability of a 

contractor’s costs charged to a cost-type procurement transaction under NGB CA 

awards—or in pricing for a fixed-price contract based on estimated costs if your cost 

principles comply with the federal cost principles that paragraph A.1 of this section 

identifies as applicable to the contractor.

Section B. Clarifications Concerning Charges for Professional Journal Publications. 

RESERVED – Not Applicable.

Section C. Period of Availability of Funds.

1. You may charge to NGB CA awards only:
31

a. Allowable costs incurred during the period of performance specified in NGB CA 

awards, including any subsequent modifications to it.

b. Any pre-award costs that you are authorized (by either the terms and conditions of 

FMS Article IV or NGB awarding official) to incur prior to the start of the period of 

performance, at your own risk, for purposes of the project or program under NGB 

CA awards.

2. Costs of publishing in professional journals incurred after the period of performance, as 

permitted under 2 CFR 200.461(b)(3), if:

a. We receive the request for payment for such costs no later than the date on which 

REP Article II requires you to submit the final financial report to us (or, if we grant 

your request for an extension of the due date, that later date on which the report is 

due).

b. Your reported expenditures on the final financial report include the amount you 

disbursed for those costs.

Section D. Fee or Profit.

1. You may not receive any fee or profit under NGB CA awards.

2. You may not use funds available to you under NGB CA awards to pay fee or profit for 

an entity of any type to which you make a subaward.

3. You may pay fee or profit to an entity with which you enter into a procurement 

transaction to purchase goods or general support services for your use in carrying out 

the project or program under the award.

FMS Article IV. Revision of Budget and Program Plans. 

Section A. Approved Budget. 

The approved budget of NGB CA awards:

a. Is the most recent version of the budget that you submitted, and we approved 

(either at the time of the initial award or a more recent modification), to summarize 

planned expenditures for the project or program.

b. Includes all federal funding that we make available to you under NGB CA awards

to use for project or program purposes and any cost sharing or matching that you 

are required to provide under NGB CA awards for those same purposes.

Section B. Revisions Requiring Prior Approval.
32

1. Non-Construction Activities. You must request prior approval from us for any of the 

following program or budget revisions in non-construction activities:

a. A change in the scope or objective of the project or program under NGB CA 

awards, even if there is no associated budget revision that requires our prior 

approval.

b. A change in a key person identified in the award cover pages.

c. The approved principal investigator’s or project director’s disengagement from the 

project for more than three months, or a 25 percent reduction in his or her time 

devoted to the project.

d. The inclusion of direct costs that require prior approval in accordance with the 

applicable cost principles, as identified in FMS Article III.

e. RESERVED – Only applicable if provided in DoD Component addendum to these 

terms and conditions.

f. A subaward to another entity under which it will perform a portion of the 

substantive project or program under the award if it was not included in the 

approved budget. This does not apply to your contracts for acquisition of 

supplies, equipment, or general support services you need to carry out the 

program.

g. Any change in the cost sharing or matching you provide under the award, as 

included in the approved budget, for which FMS Article VI requires prior approval.

h. RESERVED – Not Applicable.

i. The need arises for additional federal funds to complete the project or program.

2. Construction Activities. You must request prior approval from us for any of the 

following program or budget revisions in construction activities:

a. A change in the scope or objective of the project or program under NGB CA 

awards, even if there is no associated budget revision that requires our prior 

approval.

b. The need arises for additional federal funds to complete the project.

c. The inclusion of direct costs that require prior approval in accordance with the 

applicable cost principles, as identified in FMS Article III.

3. Funding transfers between construction and non-construction activities. Only 

applicable if provided in DoD Component addendum to these terms and conditions.

Section C. Pre-Award Costs.
33

1. You are authorized, without requesting prior approval from us, to:

Charge to NGB CA awards after you receive it, pre-award costs that you incurred, at 

your own risk, up to 90 calendar days before the start date of the period of 

performance, if they are costs that would be allowable charges to the project or 

program under the terms and conditions of FMS Article III if they were incurred during 

the period of performance. Expenses more than 90 calendar days pre-award require 

prior approval of the Federal awarding agency.

2. RESERVED – RESERVED - Only applicable if provided in award-specific terms 

and conditions.

3. RESERVED – RESERVED - Only applicable if provided in award-specific terms 

and conditions.

Section D. Procedures.

1. We will review each request you submit for prior approval for a budget or program 

change and, within 30 calendar days of our receipt of your request, we will respond to 

you in writing to either:

a. Notify you whether your request is approved; or

b. Inform you that we still are considering the request, in which case we will let you 

know when you may expect our decision.

2. RESERVED – Not Applicable.

FMS Article V. Non-Federal Audits. 

Section A. Requirements for Entities Subject to the Single Audit Act. 

You and each subrecipient under NGB CA awards that is an institution of higher 

education, nonprofit organization, state, local government, or Indian tribe must comply 

with the audit requirements specified in Subpart F of 2 CFR part 200, which is the OMB 

implementation of the Single Audit Act, as amended (31 U.S.C. chapter 75).

Section B. Requirements for For-Profit Entities. 

Any for-profit entity that receives an award or subaward from you under NGB CA 

awards is subject to the audit requirements specified in 32 CFR 34.16. In accordance 

with the Class Deviation for the Single Audit Act for For-Profit Assistance Awards, 

dated 29 June 2018, the audit requirement threshold has been increased to $750,000. 

Your subaward terms and conditions will require the subrecipient to provide the reports 

to you if it is willing to do so, so that you can resolve audit findings that pertain 

specifically to your subaward (e. g., disallowance of costs). If the for-profit entity is 
34

unwilling to agree to provide the auditor’s report to you, contact the grants officer for 

NGB CA award to discuss an alternative approach for carrying out audit oversight of 

the subaward. If the grants officer does not provide an alternative approach within 30 

days of receiving your request, you may determine an approach to ensure the for-profit 

subrecipient’s compliance with the subaward terms and conditions, as described in 

OMB guidance at 2 CFR 200.501(h).

FMS Article VI. Cost Sharing or Matching. 

Section A. Required Cost Sharing or Matching.

1. If any cost sharing or matching is required under NGB CA awards, the total amount or 

percentage required is shown in the award cover pages and included in the approved 

budget. That cost sharing or matching includes all:

a. Cash and third-party in-kind contributions.

b. Contributions to the project or program made either by or through (if made by a 

third party) you and any subrecipients.

2. You must obtain our prior approval if you wish to:

a. Change the amount or percentage of cost sharing or matching required under 

NGB CA awards.

b. RESERVED –Only applicable if provided in award-specific terms and 

conditions.

Section B. Allowability as Cost Sharing or Matching. 

1. Each cash or third-party in-kind contribution toward any cost sharing or matching 

required under NGB CA awards, whether put forward by you or a subrecipient under a 

subaward that you make, is allowable as cost sharing or matching if:

a. You (or the subrecipient, if it is a subrecipient contribution) maintain records from 

which one may verify that the contribution was made to the project or program 

and, if it is a third-party in-kind contribution, its value.

b. The contribution is not counted as cost sharing or matching for any other federal

award.

2. The contribution is:

a. Allowable under the cost principles applicable to you (or the subrecipient, if it is a 

subrecipient contribution) under FMS Article III of these terms and conditions.
35

b. Allocable to the project or program and reasonable.

c. The Federal Government does not pay for the contribution through another federal

award, unless that award is under a program that has a federal statute authorizing 

application of that program’s federal funds to other federal programs’ cost sharing 

or matching requirements.

d. The value of the contribution is not reimbursed by the federal share of NGB CA 

awards as either a direct or indirect cost.

e. The contribution conforms to the other terms and conditions of NGB CA awards, 

including the award specific terms and conditions.

Section C. Allowability of Unrecovered Indirect Costs as Cost Sharing or Matching. Not 

currently applicable to NGB - See CPP Guidance in Subdivision D of this 

document.

Section D. Allowability of Program Income as Cost Sharing or Matching. 

If FMS Article VII of these general terms and conditions or the award-specific terms and 

conditions of NGB CA awards specify that you are to use some or all of the program 

income you earn to meet cost-sharing or matching requirements under the award, then 

program income is allowable as cost sharing or matching to the extent specified in those 

award terms and conditions.

Section E. Valuation of Services or Property That You or Subrecipients Contribute or 

Donate. 

1. You must establish values for services or property contributed or donated toward cost 

sharing or matching by you or subrecipients in accordance with the provisions of this 

section. These contributions or donations are distinct from third-party contributions or 

donations to you or subrecipients, which are addressed in Section F of this article.

2. Usual valuation of services or property that you or subrecipients contribute or donate.

Values established for contributions of services or property by you or a subrecipient 

must be the amounts allowable in accordance with the cost principles applicable to the 

entity making the contribution (i.e., you or the subrecipient), as identified in FMS Article 

III. For property, that generally is depreciation.

3. Needed approvals for, and valuation of, property that you or subrecipients donate.

a. Types of Property That May Be Donated.

(1) Buildings or Land. If the purposes of NGB CA award includes construction, 

facilities acquisition, or long-term use of real property, you may donate buildings 

or land to the project if you obtain our prior approval. Donation of property to the 

project, as described in PROP Article I, means counting the value of the 

property toward cost sharing or matching, rather than charging depreciation.
36

(2) Other Capital Assets. If you obtain our prior approval, you may donate to the 

project other capital assets identified in 2 CFR 200.439(b)(1) through (3).

b. Usual Valuation of Donated Property. Unless you obtain our approval as 

described in section E.2.c of this article, the value for the donated property must be 

the lesser of:

(1) The value of the remaining life of the property recorded in your accounting 

records at the time of donation, or

(2) The current fair market value.

c. Approval Needed for Alternative Valuation of Property. If you obtain our 

approval as reflected in the approved budget, you may count as cost sharing or 

matching the current fair market value of the donated property even if it exceeds the 

value of the remaining life of the property recorded in your accounting records at 

the time of donation.

d. Federal Interest in Donated Property. Donating buildings, land, or other property 

to the project, rather than charging depreciation, results in a federal interest in the 

property in accordance with PROP Article I of these terms and conditions.

Section F. Valuation of Third-Party In-Kind Contributions.

1. General. If a third party furnishes goods or services to you or subrecipients that are to 

be counted toward cost sharing or matching under NGB CA awards, the entity to which 

the third party furnishes the goods or services (i.e., you or a subrecipient) must 

document the fair market value of those in-kind contributions and, to the extent 

feasible, support those values using the same methods the entity uses internally.

2. Valuation of Third-Party Services. You must establish values for third-party 

volunteer services and services of third parties’ employees furnished to you or 

subrecipients as follows:

a. Volunteer Services. Volunteer services furnished by third-party professional and 

technical personnel, consultants, and other skilled and unskilled labor must be 

valued in accordance with 2 CFR 200.306(e).

b. Services of Third Parties’ Employees. When a third-party organization furnishes 

the services of its employees to you or a subrecipient, values for the contributions 

must be established in accordance with 2 CFR 200.306(f).

c. Additional Requirement for Donations to Nonprofit Organizations. For 

volunteer services or services of third parties’ employees furnished to a nonprofit 

organization:

(1) OMB guidance in 2 CFR 200.434(e) also applies and may require the nonprofit 
37

organization to allocate a proportionate share of its applicable indirect costs to 

the donated services.

(2) The indirect costs that the nonprofit organization allocates to the donated 

services in that case must be considered project costs and may be either 

reimbursed under the award or counted toward required cost sharing or 

matching, but not both.

3. Valuation of Third-Party Property. You must establish values for third-party property 

furnished to you or subrecipients as follows:

a. Supplies Donated by Third Parties. When a third-party organization donates 

supplies (e.g., office, laboratory, workshop, or classroom supplies), the value that 

may be counted toward cost sharing or matching may not exceed the fair market 

value of the supplies at the time of donation.

b. Equipment, Buildings, or Land Donated by Third Parties.

(1) The value of third-party donations of equipment, buildings, or land that may be 

counted toward cost sharing or matching when the third party transferred title to 

you or a subrecipient depends on the purpose of the award in accordance with 

the following:

(a) If one of the purposes of the award is to assist you or the subrecipient in the 

acquisition of equipment, buildings, or land, you may count the aggregate 

fair market value of the donated property toward cost sharing or matching.

(b) If the award’s purposes instead include only the support of activities that 

require the use of equipment, buildings, or land, you may only charge 

depreciation unless you obtain our prior approval to count as cost sharing or 

matching the fair market value of equipment or other capital assets and fair 

rental charges for land.

(2) The values of the donated property must be determined in accordance with the 

usual accounting policies of the entity to which the third party transferred title to 

the property, with the qualifications specified in 2 CFR 200.306(i)(1) and (2) for 

donated land and buildings and donated equipment, respectively.

c. Use of Space Donated by Third Parties. If a third party makes space available for 

use by you or a subrecipient, the value that you may count toward cost sharing or 

matching may not exceed the fair rental value of comparable space as established 

by an independent appraisal, as described in 2 CFR 200.306(i)(3).

d. Equipment Loaned by Third Parties. If a third-party loans equipment for use by 

you or a subrecipient, the value that you may count toward cost sharing or matching 

may not exceed its fair rental value.
38

FMS Article VII. Program Income. 

Section A. Definition. The term “program income” as used in NGB CA awards:

1. Is gross income that:

a. You earn that is directly generated by a supported activity or earned as a result of 

NGB CA awards; or

b. A subrecipient earns as a result of a subaward you make under NGB CA awards.

2. Includes, but is not limited to, income earned under NGB CA awards from:

a. Fees for services performed.

b. The use or rental of real or personal property acquired under any federal award and 

currently administered under NGB CA awards.

c. The sale of commodities or items fabricated under NGB CA awards.

d. License fees and royalties on patents and copyrights.

e. Payments of principal and interest on loans made with federal award funds.

3. Does not include for purposes of NGB CA awards any:

a. Interest earned on advance payments, disposition of which is addressed in FMS 

Article II.

b. Proceeds from the sale of real property, equipment, or supplies, which is addressed 

in PROP Articles III and IV.

c. Rebates, credits, discounts, and interest earned on any of them.

d. Governmental revenues, including any taxes, special assessments, levies, fines,

and similar revenues you raise.

Section B. Encouragement to Earn Program Income. 

You are encouraged to earn program income under NGB CA awards when doing so 

does not interfere with the project or program the award supports.

Section C. Costs of Generating Program Income. 

You may deduct costs incidental to the generation of program income from the amount 

that you use in accordance with Section E of this Article, if those costs are not charged 

to NGB CA awards (which includes their being counted toward any cost sharing or 

matching you are required to provide).
39

Section D. License Fees and Royalties. 

You have no obligations to the Federal Government with respect to program income 

earned under NGB CA awards from license fees and royalties for patents or patent 

applications, copyrights, trademarks, or inventions developed or produced under the 

award.

Section E. Use of Program Income.

1. You must use any program income that you earn during the period of performance 

under NGB CA awards to increase the amount of the award (the sum of the federal share 

and any cost sharing or matching you are required to provide), thereby increasing the 

amount budgeted for the project or program. The program income must be used for the 

purposes and under the terms and conditions of the award.

2. Your use of the additional funding is subject to the terms and conditions of NGB CA 

awards, including:

a. FMS Article II concerning your use of balances of program income before you 

request additional funds from us.

b. FMS Article III concerning allowability of costs for which the funds may be used.

3. You must report on each Federal Financial Report (SF-425) that you submit in 

accordance with REP Article II the program income that you earn and any that you use 

during the reporting period covered by that SF-425.

Section F. Duration of Accountability for Program Income.

The requirements concerning disposition of program income in Section E of this Article 

apply only to program income you or your subrecipients earn during the period of 

performance. There are no requirements under NGB CA awards applicable to program 

income you or your subrecipients earn after the end of the period of performance.

Part 2: Property Administration (Articles from this part are designated with 

“PROP” in the article title)

PROP Article I. Title to Property. 

Section A. Title to Property Acquired under NGB CA Awards.

1. General. Other than any property identified in section A.2 of this section as exempt 

property:

a. Title to real property, equipment, and supplies that you acquire (whether by 
40

purchase, construction or fabrication, development, or otherwise) and charge as 

direct project costs under NGB CA awards vests in you, the recipient. Title to 

intangible property that you acquire (other than by developing or producing it) under 

NGB CA awards also vests in you.

b. That title is a conditional title, subject to the terms and conditions in PROP Articles 

II-IV, Section D of PROP Article VI, and REP Article III of NGB CA awards.

c. There is a federal interest in the property, other than intangible property that you 

develop or produce under the award. For real property, equipment, and intangible 

property, we retain this federal interest until final disposition of the property under 

PROP Article III (for real property), PROP Article IV (for equipment), or Section D of 

PROP Article VI (for intangible property that is acquired, other than by developing 

or producing it), a period that in some cases may extend beyond closeout of NGB 

CA awards.

2. Exempt property. RESERVED – Not Applicable.

Section B. Property Trust Relationship.

1. Basic Requirement. Other than intangible property that you develop or produce under 

the award, you hold any real property, equipment, or intangible property that you 

acquire or improve under NGB CA awards in trust for the beneficiaries of the project or 

program that you are carrying out under the award.

2. Notices of Record. RESERVED - Only applicable if provided in award-specific 

terms and conditions.

Section C. Federally Owned Property. 

Title to any federally owned property that we provide to you under NGB CA awards (or 

such property for which accountability is transferred to NGB CA awards from another 

federal award) remains with the Federal Government.

Section D. Federal Interest in Donated Real Property or Equipment.

If real property or equipment is acquired under NGB CA awards through your donation 

of the property to the project or program (i.e., counting the value of the remaining life of 

the property recorded in your accounting records or the fair market value as permitted 

under FMS Article VI of these general terms and conditions as part of your share of 

project costs to meet any cost sharing or matching requirements, rather than charging 

depreciation):

a. The Government acquires a federal interest in the real property or equipment that is 

 donated for use in the project or program.

b. The real property or equipment is subject to Section B of this article and the terms 

and conditions of PROP Articles II-IV and REP Article III that are applicable to 

property acquired under the award.
41

c. The federal interest in the real property or equipment must be addressed at the time 

 of property disposition.

Section E. Federal Interest in Property Improved under the Award.

1. The Federal Government has an interest in improvements (as distinct from ordinary 

repairs and maintenance) you make to an item of real property or equipment if you 

charge the costs of the improvements as direct costs to NGB CA award.

2. We thereby acquire an interest in the property if the Federal Government did not 

previously have one. If the Federal Government already had an interest in the 

property, the value of that federal interest in the property increases by the amount of 

the federal interest in the improvements.

3. The property is subject to Section B of this article and the terms and conditions of 

PROP Articles II-IV and REP Article III that are applicable to real property or equipment 

acquired under the award.

4. The federal interest must be addressed at the time of property disposition.

PROP Article II. Property Management System. 

Section A. Insurance Coverage for Real Property and Equipment. 

You must, at a minimum, provide the equivalent insurance coverage for real property 

and equipment acquired or improved under NGB CA awards as you provide for real 

property and equipment that you own.

Section B. Other Management System Standards for a State.

1. Equipment. Your property management system for equipment acquired or improved 

in whole or in part under an NGB CA award must be in accordance with your state laws 

and procedures.

2. Federally Owned Property. You may use your own property management system for 

any federally owned property for which you are accountable, if it meets the following 

minimum standards:

a. Records. Your records must include for each item of federally owned property:

(1) A description of the item.

(2) The location of the item.

(3) The serial or other identification number.

(4) Which federal agency holds title.
42

(5) The date you received the item.

(6) Any data on the ultimate disposition of the item, such as the date of disposal.

(7) The federal award identification number of the award under which you are 

accountable for the item.

b. Inventory. You must take a physical inventory of federally owned property at least 

annually and reconcile the results with your records.

c. Control System. You must:

(1) Maintain an internal property control system with adequate safeguards to 

prevent loss, damage, or theft of federally owned property.

(2) Investigate any loss, damage, or theft of federally owned property and promptly 

notify the award administration office.

d. Maintenance. You must maintain the property in good condition.

Section C. Other Management System Standards for an Institution of Higher Education, 

Nonprofit Organization, Local Government, Indian Tribe, For-profit entity. 

1. Your procedures for managing equipment (including replacement equipment) acquired 

or improved in whole or in part under NGB CA awards and any federally owned 

property for which you are accountable under NGB CA awards must, as a minimum, 

meet the requirements in this section.

2. Records. You must maintain records that include for each item of equipment or 

federally owned property:

a. A description of the item.

b. The serial or other identification number.

c. Who holds title (e.g., you or the Federal Government and, if the latter, which federal

agency).

d. The source of funding for the equipment, including the award number, or the source 

of the federally owned property, including the award number of the award under 

which you are accountable for the property.

e. The acquisition date and cost of the equipment (or improvement to the equipment) 

or the date you received the federally owned property.

f. The location, use, and condition of the equipment or federally owned property.
43

g. Information from which one can calculate the amount of the federal interest in the 

acquisition or improvement of the item (this amount is zero after you compensate us 

for the federal interest in the item or improvement).

h. Any data on the ultimate disposition of the item including the date of disposal and 

sale price.

3. Labelling. You must ensure that property owned by the Federal Government is 

labeled to identify it as federally owned property.

4. Inventory. You must take a physical inventory of equipment in which there is a federal

interest and reconcile the results with your records at least once every 2 years.

5. Control system. You must:

a. Maintain an internal property control system with adequate safeguards to prevent 

loss, damage, or theft of equipment and federally owned property.

b. Investigate any loss, damage, or theft and notify the award administration office if it 

involved equipment in which there is a federal interest under the award or federally 

owned property.

6. Maintenance. You must maintain equipment acquired or improved in whole or in part 

under the award and federally owned property in good condition.

PROP Article III. Use and Disposition of Real Property. 

Section A. Use of Real Property.

1. You must use real property acquired or improved under NGB CA awards for the 

originally authorized purpose if needed for that purpose. During that time, you may not:

a. Dispose of the property except, with the prior approval of the award administration 

office, to acquire replacement property under NGB CA awards, in which case you 

may use the proceeds from the disposition as an offset to the cost of the 

replacement property; or

b. Encumber the title or other interests in the property without the prior approval of the 

award administration office.

2. RESERVED – Not Applicable.

3. RESERVED – Not Applicable.

Section B. Disposition of Real Property. 

1. When you no longer need real property for the originally authorized purpose, you must 
44

obtain disposition instructions from the award administration office except as provided 

in any section A.3 of this article. Those instructions will provide for one of the following 

three alternatives, which are that you:

a. Retain title after compensating us for the federal interest in the property, which is 

to be computed as specified in the definition of “federal interest.”

b. Sell the property and compensate us for the federal interest in the property, as 

described in 2 CFR 200.311(c)(2).

2. Transfer title to us or a third party we designate, as described in 2 CFR 200.311(c)(3).

PROP Article IV. Use and Disposition of Equipment and Supplies. 

Section A. Property Subject to This Article. 

This article specifies requirements for use and disposition of equipment and supplies. If 

a provision of PROP Article I of these general terms and conditions and NGB CA award

identifies any type of equipment or supplies as exempt property, requirements of this 

Article apply to that exempt property only to the extent specified in that provision of 

PROP Article I or an award-specific term or condition. The types of non-exempt 

property to which this article applies are:

a. Supplies that you acquire either by purchase or by donation as cost sharing or 

matching under an NGB CA award.

b. Equipment for which title is vested conditionally in you. That includes equipment with 

a conditional title resulting from your having, either under an NGB CA award or 

under a previous award from which you transferred accountability for the equipment 

to an NGB CA award:

(1) Directly charged as project costs, in whole or in part, the acquisition (by 

purchase, construction or fabrication, or development) of equipment,

(2) Donated the equipment to the project or program by counting the value of the 

remaining life of the property recorded in your accounting records or the fair 

market value toward any cost sharing or matching requirements under the award, 

rather than charging depreciation (see PROP Article I, Section D); or

(3) Directly charged as project costs improvements to the equipment that meet the 

criteria given in section E.1 of PROP Article I.

Section B. Requirements for a State’s Use and Disposition of Equipment. 

a. You must use the equipment for the authorized purposes of the project or program 

during the period of performance, or until the property is no longer needed for those 

purposes.
45

b. You may not encumber the property without the prior approval of the award 

administration office.

c. You must use and dispose of the equipment in accordance with your state laws and 

procedures.

Section C. Use of Equipment by an Institution of Higher Education, Nonprofit 

Organization, Local Government, Indian Tribe, or For-profit Entity. 

1. You must use the equipment for the authorized purposes of the project or program 

under an NGB CA award until the equipment is no longer needed for those purposes, 

whether the project or program continues to be supported by NGB CA awards.

2. You may not encumber the equipment without the prior approval of the award 

administration office.

3. During the time that the equipment is used for the project or program under an NGB CA 

award:

a. You must make the equipment available for use on other projects or programs but 

only if that use will not interfere with the equipment’s use as needed for the project 

or program supported by NGB CA award.

(1) First preference must be given to other projects or programs supported or 

previously supported by NGB and second preference to those supported or 

previously supported by other federal agencies.

(2) Third preference is for other projects or programs not supported by the Federal 

Government. You should charge user fees for use of the equipment in those 

cases if it is at all practicable.

b. You may use the equipment, if you need to acquire replacement equipment, as a 

trade-in or sell it (using sales procedures designed to ensure the highest possible 

return) and use the proceeds from the sale to offset the cost of the replacement 

equipment.

4. When the equipment is no longer needed for the project or program under an NGB CA 

award, you may defer final disposition of the equipment and continue to use it on other 

federally sponsored projects or programs. You must give priority to other projects or 

programs supported by NGB.

5. Notwithstanding the encouragement in FMS Article VII to earn program income, you 

may not use equipment in which there currently is a federal interest--whether you 

acquired it under an NGB CA award or are otherwise accountable for it under an NGB 

CA award--to provide services for a fee that is less than private companies charge for 

equivalent services.
46

Section D. Disposition of Equipment by an Institution of Higher Education, Nonprofit

Organization, Local Government, Indian Tribe, or For-profit Entity. 

1. You must request disposition instructions from the award administration office when 

either original or replacement equipment acquired under an NGB CA award with a 

current fair market value that exceeds $5,000 is no longer needed for the original 

project or program or for other federally sponsored activities as described in Section

C.4. of this article. For each item of equipment with a current fair market value of 

$5,000 or less, you may retain, sell, or otherwise dispose of the item with no further 

obligation to the Federal Government.

2. We may issue disposition instructions that:

a. Allow you to retain or sell any item of equipment after compensating us for the 

federal interest in the property, which is to be computed as specified in the 

definition of “federal interest;” or

b. Require you to transfer title to the equipment to a federal agency or a third-party, in 

which case you are entitled to compensation from us for the non-federal interest in 

the equipment, plus any reasonable shipping or interim storage costs incurred.

3. If we fail to provide disposition instructions for any item of equipment within 120 

calendar days of receiving your request, you may retain or sell the equipment, but you 

must compensate us for the amount of the federal interest in the equipment.

4. If you sell the equipment:

a. You must use sales procedures designed to ensure the highest possible return.

b. You may deduct and retain for selling and handling expenses either $500 or ten 

percent of the proceeds, whichever is less.

Section E. Use and Disposition of Supplies Acquired under NGB CA Awards.

1. Use. If we retain a federal interest in supplies acquired under an NGB CA award either 

by purchase or by donation as cost sharing or matching, you may not use the supplies 

to provide services to other organizations for a fee that is less than private companies

charge for equivalent services, notwithstanding the encouragement in FMS Article VII 

to earn program income.

2. Disposition. If you have a residual inventory of unused supplies with aggregate value 

exceeding $5,000 at the end of the period of performance under an NGB CA award, 

and the supplies are not needed for any other federal award, you may retain the 

supplies or sell them but must in either case compensate us for the amount of the 

federal interest in the supplies. You may deduct and retain for selling and handling 

expenses either $500 or ten percent of the proceeds, whichever is less.
47

PROP Article V. Use and Disposition of Federally Owned Property. 

Section A. Use. 

During the time that federally owned property for which you are accountable under an 

NGB CA award is used for the project or program supported by the award, you:

a. Also, may make the property available for use on other federally supported projects 

or programs, but only if that use will not interfere with the property’s use for the 

project or program supported by NGB CA award. You must give priority to other 

projects or programs supported by DoD Components (NGB).

b. May use the property for purposes other than federally supported projects or 

programs only with the prior approval of the awarding office or, if you request 

approval after the award is made, the award administration office.

Section B. Disposition. 

You must request disposition instructions from the award administration office for any 

federally owned property under an NGB CA award, including any property for which a 

subrecipient is accountable under a subaward you make under an NGB CA award, 

either:

a. At any time during the period of performance if the property is no longer needed for 

the project or program supported by NGB CA awards; or

b. At the end of the period of performance.

PROP Article VI. Intangible Property. 

Section A. Assertion of Copyright.

1. You may assert copyright in any work that is eligible for copyright protection if you 

acquire ownership of it under an NGB CA award, either by developing it or otherwise.

2. With respect to any work in which you assert copyright, as described in paragraph A.1 

of this section, NGB reserves a royalty-free, nonexclusive, and irrevocable license to:

a. Reproduce, publish, or otherwise use the work for Federal Government purposes.

b. Authorize others to reproduce, publish, or otherwise use the work for Federal 

Government purposes.

Section B. Inventions Developed under the Award.

1. Applicability of Governmentwide Clause for Research Awards. You must comply 

with the governmentwide patent rights award clause at 37 CFR 401.14, with the 
48

modifications described in section B.2 of this section. NGB adopts that 

Governmentwide clause for the following entities, thereby broadening the applicability 

beyond types of entities included in the definition of “contractor” in 37 CFR part 401:

Any institution of higher education, non-profit organization, state, local government, 

Indian tribe, for-profit entity, foreign organization, or foreign public entity receiving a 

NGB award for the performance of experimental, research, or developmental work.

2. Modifications to the Wording of the Federal Governmentwide Clause. NGB

adopts the governmentwide clause at 37 CFR 401.14, as described in paragraph B.1 

of this section, with the following modifications:

a. Terminology. Throughout the governmentwide award clause:

(1) Insert the terms “recipient” and “subrecipient (or contractor to the recipient or to 

a subrecipient)” to replace the terms “contractor” and “subcontractor,” 

respectively.

(2) Insert the terms “award” and “subaward (or contract under either the award or a 

subaward)” to replace the terms “contract” and “subcontract,” respectively.

b. Final report. Add a new subparagraph (f)(5) to read, “The recipient must submit a 

final report listing all subject inventions made under the award or stating that there 

were none. The final report is due 120 calendar days after the end date of the 

period of performance unless you request, and we grant an extension of the due 

date.”

c. Broadening Applicability to all Entities. Delete sections (g)(2) and (3) of the 

governmentwide clause, redesignate paragraph (g)(1) as paragraph (g), and delete 

the phrase “to be performed by a small business firm or domestic nonprofit 

organization” from paragraph (g) as redesignated.

Section C. Data Produced under the Award.

1. Data in general. The Federal Government has the right to:

a. Obtain, reproduce, publish, or otherwise use the data produced under NGB CA 

awards.

b. Authorize others to receive, reproduce, publish, or otherwise use the data produced 

under NGB CA awards for Federal Government purposes.

2. Research Data Requested under the Freedom of Information Act (FOIA). 

a. If we receive a request under the FOIA for “research data” that are related to 

“published research findings” produced under NGB CA awards and that were “used 

by the Federal Government in developing an agency action that has the force and 

effect of law,” you must provide the data to us within a reasonable time after we 
49

request it from you, so that the data can be made available to the public through 

procedures established under the FOIA.

b. For purposes of the requirement in paragraph C.2.a of this section, 2 CFR 

200.315(e) provides definitions of the phrases “published research findings,” “used 

by the Federal Government in developing an agency action that has the force and 

effect of law,” and “research data.”

Section D. Use and Disposition of Intangible Property Acquired, but not Developed or 

Produced, under the Award.

1. Applicability. This section applies to a patent, patent application, copyright, or other 

intangible property acquired, but not developed or produced, under NGB CA awards.

2. Use. You:

a. Must use the intangible property for the authorized purpose under NGB CA awards

until the intangible property is no longer needed for that purpose, whether that 

purpose is still being supported by NGB CA awards.

b. May not encumber the intangible property without the prior approval of the award 

administration office.

3. Disposition. When the intangible property is no longer needed for the originally 

authorized purpose, you must contact the award administration office to arrange for 

disposition in accordance with the procedures specified for disposition of equipment in 

either Section B or D of PROP Article IV, as applicable.

Part 3: Procurement (Articles from this part are designated with “PROC” 

in the article title)

PROC Article I. Procurement Standards for States. 

Section A. Use of State Procurement System. 

Subject only to the conditions in Sections B through D of this article, you must use the 

same policies and procedures to procure supplies, equipment, real property, and 

services under NGB CA awards that you use when you procure those items for state

purposes using non- federal funds.

Section B. Procurement of Recovered Materials. 

You must comply with the Resource Conservation and Recovery Act requirements 

described in OMB guidance in 2 CFR 200.323.
50

Section C. Debarment and Suspension. 

You must comply with restrictions on awarding procurement transactions to excluded or 

disqualified parties and other requirements specified by OMB guidelines on 

nonprocurement debarment and suspension at 2 CFR part 180, as implemented by 

NGB at 2 CFR part 1125.

Section D. Contract Provisions. 

You must include provisions in your procurement transactions under NGB CA awards to 

require the contractors’ compliance with the requirements specified in PROC Article III, 

as applicable.

PROC Article II. Procurement Standards for Institutions of Higher Education, Nonprofit 

Organizations, Local Governments, Indian Tribes, and For-profit 

Entities. 

Section A. General Procurement Standards.

1. For procurement under NGB CA awards, you must comply with the OMB guidance in 2 

CFR 200.318.

2. You must do business only with responsible contractors who are able to perform, as 

described in OMB guidance in 2 CFR 200.318(h). Related to that, you must comply 

with restrictions on awarding procurement transactions to excluded or disqualified 

parties and other requirements specified by OMB guidelines on nonprocurement 

debarment and suspension at 2 CFR part 180, as implemented by DoD (NGB as a 

Component) at 2 CFR part 1125.

Section B. Competition. 

You must award procurement transactions NGB CA awards in accordance with the

competition requirements described in OMB guidance in 2 CFR 200.319.

Section C. Procurement Methods. 

You must award procurement transactions under NGB CA awards using methods 

described in OMB guidance in 2 CFR 200.320.

Section D. Contracting with Small and Minority Businesses, Women’s Business 

Enterprises, and Labor Surplus Area Firms. 

You must take the affirmative steps described in OMB guidance in 2 CFR 200.321 when 

awarding procurement transactions under NGB CA awards.

Section E. Contract Cost and Price. 
51

When awarding a procurement transaction under NGB CA awards, you must follow the 

procedures related to cost and price that are described in OMB guidance in 2 CFR 

200.324, using the applicable cost principles specified in FMS Article III.

Section F. Contract Provisions. 

You must include provisions in your procurement transactions under NGB CA awards to 

require the contractors’ compliance with the requirements of PROC Article III, as 

applicable.

Section G. Procurement of Recovered Materials. 

If you are a political subdivision of a state, you must comply with the Resource 

Conservation and Recovery Act requirements described in OMB guidance in 2 CFR 

200.323.

Section H. Review of Procurement Documents. 

Upon our request, you must make available:

a. Technical specifications on proposed procurement transactions, as described in 2 

CFR 200.325(a).

b. Pre-procurement documents for our review, as described in 2 CFR 200.325(b) 

unless you are exempt from that requirement under 2 CFR 200.325(c).

Section I. Domestic Preferences for Procurements.

As appropriate and to the extent consistent with law, you should, to the greatest extent 

practicable under NGB CA awards, provide a preference for the purchase, acquisition, 

or use of goods, products, or materials produced in the United States (including but not 

limited to iron, aluminum, steel, cement, and other manufactured products). This must 

be included in all subawards including all contracts and purchase orders for work or 

products under NGB CA awards.

Section J. Bonding Requirements. RESERVED - Only applicable if provided in awardspecific terms and conditions.

PROC Article III. Contract Provisions for Recipient Procurements. 

Section A. Contract Provisions for Administrative Requirements.

1. Remedies. In any contract under NGB CA awards for an amount more than the 

simplified acquisition threshold, you must provide for administrative, contractual, or 

legal remedies, including any appropriate sanctions and penalties, when the contractor 

violates or breaches the contract terms.
52

2. Termination. In any contract for an amount more than $10,000, you must specify: 

conditions under which you may terminate the contract for cause or convenience; the 

procedures for termination; and the basis to be used for settlement.

3. Allowable Costs under Cost-Type Contracts. In any cost-type contract with an entity, 

you must include a clause to permit the entity to charge to the contract only costs that 

are allowable under the cost principles that FMS Article III identifies as applicable to 

that type of entity, as supplemented by any award-specific terms and conditions related 

to allowability of costs that are included in NGB CA awards. Your contract clause may 

permit the contractor to use its own cost principles in determining the allowability of its 

costs charged to the contract, if its cost principles comply with those federal cost 

principles supplemented by any award-specific terms and conditions of NGB CA 

awards.

4. Rights in Copyright and Data. You must include in each contract under NGB CA 

awards a provision requiring that the contractor:

a. Grant the Federal Government a royalty-free, nonexclusive, and irrevocable right to:

(1) Reproduce, publish, or otherwise use for federal purposes any work that is 

subject to copyright and that the contractor develops, or acquires ownership of, 

under NGB CA awards.

(2) Authorize others to reproduce, publish, or otherwise use such work for federal

purposes.

b. Grant the Federal Government the right to:

(1) Obtain, reproduce, publish, or otherwise use data produced under NGB CA 

awards.

(2) Authorize others to receive, reproduce, publish, or otherwise use such data for 

federal purposes.

(3) Include the Federal Government rights described in subparagraphs 4.a. and 

4.b. of this section in any subcontracts.

5. Access to Records.

a. In any negotiated, cost-type or time and materials contract for an amount more than

the simplified acquisition threshold, you must provide for access to any of the 

contractor’s books, documents, papers, and records that are directly pertinent to 

that contract, to enable and support audits, examinations, excerpts, and 

transcriptions. The contract provision must provide access to those records for all 

of the following and their duly authorized representatives:

(1) You.
53

(2) Us as the federal awarding agency, including our Inspector General.

(3) The Comptroller General of the United States.

b. In any audit services contract for performance of an audit required by the Single 

Audit Act, as implemented by OMB in Subpart F of 2 CFR part 200, you must 

provide for the access to audit documentation described in 2 CFR 200.517(b).

6. Records Retention.

a. In directly pertinent to that contract for 3 years after you make final payment, and all 

pending matters are closed.

b. In any audit services contract for performance of an audit required by the Single 

Audit Act, as implemented by OMB in Subpart F of 2 CFR part 200, you must 

provide for the retention any negotiated, cost-type or time and materials contract for 

an amount more than the simplified acquisition threshold, you must provide for 

retention of all records that are of audit documentation described in 2 CFR 

200.517(a).

7. Reporting. In any contract awarded under NGB CA awards, you must include any 

provision for the contractor’s reporting to you that may be needed for you to meet your 

requirements under NGB CA awards to report to us.

Section B. Contract Provisions for National Policy Requirements.

1. Equal Employment Opportunity. You must include the clause provided in 41 CFR 

60-1.4(b) in any “federally assisted construction contract” (as defined in 41 CFR 60-

1.3) under NGB CA Awards unless provisions of 41 CFR part 60-1 exempt the contract 

from the requirement.

2. Wage Rate Requirements (Construction). RESERVED - Only applicable if 

provided in award-specific terms and conditions.

3. Copeland Act prohibition on Kickbacks. RESERVED - Only applicable if provided 

in award-specific terms and conditions.

4. Contract Work Hours and Safety Standards Act for Work Involving Mechanics or 

Laborers. In each contract for an amount greater than $100,000 that involves the 

employment of mechanics or laborers and is not a type of contract excepted under 40 

U.S.C. 3701, you must include the clauses specified in Department of Labor (DoL) 

regulations at 29 CFR 5.5(b) to require use of wage standards that comply with the 

Contract Work Hours and Safety Standards Act (40 CFR, Subtitle II, Part A, Chapter 

37), as implemented by the DoL at 29 CFR part 5, “Labor Standards Provisions 

Applicable to Contracts Governing Federally Financed and Assisted Construction.”

5. Patents and Inventions. If you procure the services of a nonprofit organization, small 
54

business firm, or other entity for the performance of experimental, developmental or 

research work, you must include in the contract the clause prescribed in Section B of 

PROP Article VI to establish contractual requirements regarding subject inventions 

resulting from the contract and provide for Government rights in those inventions.

6. Clean Air and Water Requirements. You must:

a. In each contract for an amount greater than $150,000 under NGB CA awards, 

include a clause requiring the contractor to comply with applicable provisions of the 

Clean Air Act (42 U.S.C. 7401-7671q), Federal Water Pollution Control Act (33 

U.S.C. 1251-1387), and standards, orders, or regulations issued under those acts.

b. Report any violations of the Acts, standards, orders, or regulations to both the 

award administration office and the appropriate regional office of the Environmental 

Protection Agency.

7. Nonprocurement Suspension and Debarment. Unless you have an alternate method 

for requiring the contractor’s compliance, you must include a clause in each contract 

for an amount equal to or greater than $25,000 and in each contract for federally 

required audit services to require the contractor to comply with OMB guidance on 

nonprocurement suspension and debarment in 2 CFR part 180, as implemented by 

NGB regulations at 2 CFR part 1125.

8. Byrd Amendment Anti-Lobbying Requirements. In each contract for an amount 

exceeding $100,000, you must include a clause requiring the contractor to submit to 

you the certification and any disclosure forms regarding lobbying that are required 

under 31 U.S.C. 1352, as implemented by the DoD (NGB) at 32 CFR part 28.

9. Purchase of Recovered Materials by States or Political Subdivisions of States. In 

each contract under which the contractor may purchase items designated in 

Environmental Protection Agency (EPA) regulations in 40 CFR part 247, Subpart B, 

you must include a clause requiring the contractor to comply with applicable 

requirements in those EPA regulations, which implement section 6002 of the Resource 

Conservation and Recovery Act of 1976, as amended (42 U.S.C. 6962).

10. Fly America Requirements. In each contract under which funds provided under NGB 

CA awards might be used for international air travel for the transportation of people or 

property, you must include a clause requiring the contractor to:

a. Comply with the International Air Transportation Fair Competitive Practices Act of 

1974 (49 U.S.C. 40118, also known as the "Fly America” Act), as implemented at 

41 CFR 301-10.131 through 301-10.143. The law and regulations provide that 

U.S. Government-financed international air travel of passengers and 

transportation of personal effects or property must use a U.S. Flag air carrier or be 

performed under a cost-sharing arrangement with a U.S. carrier, if such service is 

available.
55

b. Include the requirements of the Fly America Act in all subcontracts that might 

involve international air transportation.

11. Cargo preference for United States flag Vessels. In each contract under which 

equipment, material, or commodities may be shipped by oceangoing vessels, you 

must include the clause specified in Department of Transportation regulations at 46 

CFR 381.7(b) to require that at least 50 percent of equipment, materials or 

commodities purchased or otherwise obtained with federal funds under NGB CA 

awards, and transported by ocean vessel, be transported on privately owned U.S.-

flag commercial vessels, if available.

12. Prohibition on Using Funds under Grants and Cooperative Agreements with 

Entities that Require Certain Internal Confidentiality Agreements. You must 

include the provision provided in Section B.1 of NP Article IV in Part 8 of these general 

terms and conditions in each contract under NGB CA awards.

13. Prohibition on Certain Telecommunications and Video Surveillance Services or 

Equipment. You must include the provision provided in Section A.18 of NP Article IV 

in Part 8 of these general terms and conditions in each contract under NGB CA 

awards.

14. The Infrastructure Investment and Jobs Act (“IIJA”). Pub. L. No. 117-58, which 

includes the Build America, Buy America Act (“the Act”). Pub. L. No. 117-58, §§ 

70901-52.

The Act strengthens Made in America Laws and will bolster America’s industrial 

base, protect national security, and support high-paying jobs. The Act requires that 

the head of each Federal agency shall ensure that “none of the funds made 

available for a Federal financial assistance program for infrastructure may be 

obligated for a project unless all of the iron, steel, manufactured products, and 

construction materials used in the project are produced in the United States.”

Part 4: Reporting (Articles from this part are designated with “REP” in the 

article title)

REP Article I. Performance Management, Monitoring, And Reporting. 

Section A. Required Reporting Form, Format, or Data Elements for Interim and Final 

Performance Reports. RESERVED - Language in award-specific terms and 

conditions.

Section B. Frequency, Reporting Periods, and Due Dates for Interim Performance 

Reports. RESERVED - Language in award-specific terms and conditions.
56

Section C. Due Date and Reporting Period for Final Performance Report.

1. Due Date. You must submit the final performance report NGB CA awards no later than 

120 calendar days after the end date of the period of performance unless we approve 

an extension of that due date as described in Section D of this article.

2. Reporting Period. Final reports must be cumulative (i.e., each final report should

cover the entire period of performance under the award and not just the period since 

the previous interim performance report).

Section D. Extensions of Due Dates. 

You may request extensions of the due dates that Sections B and C of this Article 

specify for interim and final reports, respectively. You must provide the reasons for your 

request, and we will consider approving extensions that are adequately justified.

Section E. Reporting Significant Developments. 

You must report the following information to us as soon as you become aware of it:

a. Problems, delays, or adverse conditions that will materially impair your ability to 

meet the objectives of NGB CA awards. This disclosure must include a statement 

of the action taken, or contemplated, and any assistance needed to resolve the 

situation.

b. Favorable developments which will enable you to meet schedules and objectives 

sooner or at less cost than anticipated or produce more or different beneficial 

results than originally planned.

Section F. Performance Reporting Procedures. RESERVED - Language in awardspecific terms and conditions.

Section G. Site Visits. 

We reserve the right to make site visits as warranted to monitor program performance 

under NGB CA awards.

REP Article II. Financial Reporting. 

Section A. Required Reporting Form, Format, or Data Elements for Interim and Final 

Financial Reports. RESERVED - Language in award-specific terms and 

conditions.

Section B. Interim Financial Reports: Frequency, Reporting Periods, and Due Dates. 

RESERVED - Language in award-specific terms and conditions.

Section C. Final Financial Report. 
57

You must submit the final financial report under NGB CA awards no later than 120 

calendar days after the end date of the period of performance.

Section D. Extensions of Due Dates. 

You may request extensions of the due dates that Sections B and C of this Article 

specify for interim and final reports, respectively. You must provide the reasons for 

your request, and we will consider approving extensions that are adequately justified.

Section E. Where and How to Submit Financial Reports. RESERVED - Language in

award-specific terms and conditions.

REP Article III. Reporting on Property. 

Section A. Real Property. 

1. Sections A.1 through A.4 apply to real property for which you are accountable under 

NGB CA awards, for as long as there is a federal interest in the property (whether that 

interest is due to you or a subrecipient having acquired or improved the property under 

NGB CA awards, or a transfer of the accountability for the property to NGB CA awards

from another award).

2. Periodic status reports. You must submit periodic status reports, as follows:

a. Frequency and duration of reporting requirement. RESERVED - Language in 

award-specific terms and conditions.

b. Due dates. RESERVED - Language in award-specific terms and conditions.

c. Other submission instructions. RESERVED - Language in award-specific terms 

and conditions.

3. Notifications of Critical Changes. You must notify the award administration office of 

any critical change in the status of real property as soon as feasible after you become 

aware of it. A critical change is any event with a significant adverse impact on the 

condition or value of the property, such as damage due to fire; flood, hurricane, or 

other severe weather; earthquake; or accident.

4. Requests for Disposition Instructions. You must comply with applicable 

requirements in PROP Article III to request disposition instructions, either during the 

period of performance or at closeout.

5. Closeout Accounting. You must account to the award administration office for real 

property at the time of closeout of the award, as required by Section D of OAR Article 

VI.

Section B. Equipment and Supplies. 
58

1. Section B.1 through B.4 apply to equipment or supplies for which you are accountable 

under NGB CA awards and in which there is a federal interest (whether that interest is 

due to you or a subrecipient having acquired or improved the property under NGB CA 

awards, or a transfer of the accountability for the property to NGB CA awards from 

another award).

2. Periodic Status Report. There is no requirement for periodic reporting during the 

period of performance.

3. Notifications of Loss, Damage, or Theft. You must comply with applicable 

requirements in PROP Article II governing your property management system to 

promptly notify the award administration office of any loss, damage, or theft of 

equipment.

4. Requests for Disposition Instructions. You must comply with applicable 

requirements in PROP Article IV to request disposition instructions for equipment, 

either during the period of performance or at closeout.

5. Closeout Accounting.

a. Equipment. You must account to the award administration office for equipment at 

the time of closeout of NGB CA awards, as required by Section D of OAR Article VI.

b. Supplies. If you have a residual inventory of unused supplies that meets the 

criteria specified in Section E.2 of PROP Article IV, you must as part of your 

closeout accounting arrange with the award administration office for the 

compensation that paragraph specifies for the federal interest in the supplies.

Section C. Federally Owned Property. 

1. Sections C.1 through C.4 apply to federally owned property for which you are 

accountable under NGB CA awards.

2. Annual Inventory. You must submit annually to the award administration office an 

inventory of federally owned property.

3. Notifications of loss, Damage, or Theft. As provided in PROP Article II governing 

your property management system, you must promptly notify the award administration 

office of any loss, damage, or theft of federally owned property.

4. Requests for Disposition Instructions. You must comply with requirements in 

Section B of PROP Article V to request disposition instructions, either during the period 

of performance or at closeout.

5. Closeout Accounting. Your requests for disposition instructions for federally owned 

property, as described in paragraph C.4 of this section, satisfy the need to account for 

federally owned property at closeout (see Section D of OAR Article VI).
59

Section D. Intangible Property. 

1. Sections D.1 through D.3 apply to intangible property for which you are accountable 

under NGB CA awards.

2. Inventions Developed under the Award. You must submit all reports on subject 

inventions developed under NGB CA awards that are required by the modified 

Governmentwide patent rights award provision specified in Section B of PROP Article 

VI, which include a disclosure of each subject invention and a final report listing all 

such subject inventions.

3. Copyrights and Data. You are not required to submit periodic reports about data 

produced under theaward or about works for which you acquired ownership under 

NGB CA awards, either by development or otherwise, and in which copyright was 

asserted. However, because the Federal Government has the rights in the works and 

data that Sections A and C of PROP Article VI specify, you must provideinformation

about the works and data if we request it.

4. Intangible Property Acquired, but not Developed or Produced, under the Award. 

You must comply with requirements in Section D of PROP Article VI to request 

disposition instructions for intangible property acquired, but not developed or produced, 

under the award.

REP Article IV. Reporting on Subawards and Executive Compensation. 

You must report information about subawards and executive compensation as 

specified in the award provision in appendix A to 2 CFR part 170, “Reporting subaward 

and executive compensation information,” modified as follows:

a. To accommodate any future designation of a different Governmentwide Web site

for reporting subaward information, the Web site “http://www.fsrs.gov” cited in 

paragraphs a.2.i. and a.3 of the award provision is replaced by the phrase 

“http://www.fsrs.gov or successor OMB-designated Web site for reporting 

subaward information;”

b. To accommodate any future designation of a different Governmentwide Web site 

for reporting executive compensation information, the Web site 

“http://www.sam.gov” cited in paragraph b.2.i. of the award provision is replaced 

by the phrase “https://www.sam.gov or successor OMB-designated Web site for 

reporting information on total compensation.”

Part 5: Other Administrative Requirements (Articles from this part are 

designated with “OAR” in the article title)

OAR Article I. Submitting and Maintaining Recipient Information. 
60

Section A. System for Award Management.

1. Unless you are exempted from this requirement in accordance with OMB guidance in 2 

CFR 25.110, you must maintain the currency of information about yourself in the 

system the Federal Government specifies as the repository for information about its 

business partners (currently the System for Award Management (SAM)). This includes 

information on your immediate and highest-level owner and subsidiaries, as well as on 

all your predecessors that have been awarded a federal contract or federal financial 

assistance within the last three years, if applicable.

2. You must maintain the information in that system until you submit the final financial 

report required under NGB CA awards or receive the final payment, whichever is later.

3. You must review and update the information at least annually after your initial 

registration in the system (unless you are subject to the requirements in Section B) and 

more frequently if required by changes in your information.

Section B. Reporting of Performance and Integrity Information.

1. General Reporting Requirement. If the total value of your currently active grants, 

cooperative agreements, and procurement contracts from all federal agencies exceeds 

$10,000,000 for any time during the period of performance of NGB CA awards, then 

during that time you must maintain in SAM the currency of information required by 

Section B.2 of this section. Note that:

a. This reporting is required under section 872 of Public Law 110-417, as amended 

(41 U.S.C. 2313).

b. As required by section 3010 of Public Law 111-212, all performance and integrity 

information posted in the designated information system on or after April 15, 2011, 

except past performance reviews required for federal procurement contracts, will 

be publicly available.

c. Recipient information is submitted to the OMB-designated integrity and 

performance system through the SAM, as described in section B.3 of this section. 

The currently designated integrity and performance information system is the 

Federal Awardee Performance and Integrity Information System (FAPIIS).

2. Proceedings About Which You Must Report. Submit the information that the 

designated information system requires about each proceeding that:

a. Is in connection with the award or performance of a grant, cooperative agreement, 

or procurement contract from the Federal Government.

b. Reached its final disposition during the most recent 5-year period.

c. Is one of the following:
61

(1) A criminal proceeding that resulted in a conviction, as defined in Section B.5. 

of this section.

(2) A civil proceeding that resulted in a finding of fault and liability and payment of 

a monetary fine, penalty, reimbursement, restitution, or damages of $5,000 or 

more.

(3) An administrative proceeding, as defined in Section B.5. of this section, that 

resulted in a finding of fault and liability and your payment of either monetary 

fine or penalty of $5,000 or more or a reimbursement, restitution, or damages 

more than $100,000; or

(4) Any other criminal, civil, or administrative proceeding if:

(a) It could have led to an outcome described in section B.2.c.i, ii, or iii of this 

section.

(b) It had a different disposition arrived at by consent or compromise with an 

acknowledgment of fault on your part.

(c) The requirement in this section to disclose information about the 

proceeding does not conflict with applicable laws and regulations.

3. Reporting Procedures. Submit the information required in Section B.2 of this section 

to the Entity Management functional area of SAM.

a. Current procedures are to submit the information as part of the maintenance of 

your information in the SAM that Section A of this article requires.

b. You do not need to submit the information again under NGB CA awards if you 

already reported current information to the SAM under another federal grant, 

cooperative agreement, or procurement contract.

4. Reporting frequency. During any period when you are subject to the requirement in 

section B.1 of this section, you must report to SAM at least semiannually following your 

initial report of any information required in Section B.2 of this section, either to provide 

new information not reported previously or affirm that there is no new information to 

report.

5. Definitions. For purposes of this section:

a. Administrative proceeding means a non-judicial process that is adjudicatory in 

nature to make a determination of fault or liability (e.g., Securities and Exchange 

Commission Administrative proceedings, Civilian Board of Contract Appeals 

proceedings, and Armed Services Board of Contract Appeals proceedings). This 

includes proceedings at the federal and state level but only in connection with 

performance of a federal contract, grant, or cooperative agreement. It does not 
62

include audits, site visits, corrective plans, or inspection of deliverables.

b. Conviction means a judgment or conviction of a criminal offense by any court of 

competent jurisdiction, whether entered upon a verdict or a plea, and includes a 

conviction entered upon a plea of nolo contendere.

c. Total value of currently active grants, cooperative agreements, and procurement 

contracts includes:

(1) Only the federal share of the funding under any federal agency award with a 

recipient cost share or match.

(2) The value of all expected funding increments and options, even if not yet 

exercised, under each federal agency award.

Section C. Disclosure of Evidence of Integrity-Related Issues.

1. Disclosure requirement. At any time during the period of performance of NGB CA 

awards, if you have evidence that a covered person committed a covered action (see 

Sections C.2 and C.3 of this section) that may NGB CA awards, you must disclose the 

evidence in writing to the Office of the Inspector General, DoD, with a copy to the 

grants officer identified in the award cover pages.

2. Covered Person. As the term is used in this section, “covered person” means a 

principal, employee, or agent of either you or a subrecipient under NGB CA awards, 

where:

a. “Principal” means:

(1) An officer, director, owner, partner, principal investigator, or other person with 

management or supervisory responsibilities that relate to NGB CA awards; or

(2) A consultant or other person, whether employed by you or a subrecipient or 

paid with funds under NGB CA awards, who:

(a) Is in a position to handle funds under NGB CA awards;

(b) Is in a position to influence or control the use of those funds; or

(c) Occupies a technical or professional position capable of substantially 

influencing the development or outcome of an activity required to perform 

the project or program under NGB CA awards.

b. “Agent” means any individual who acts on behalf of, or who is authorized to commit 

you or the subrecipient, whether or not employed by you or the subrecipient.

3. Covered Action. As the term is used in this section, “covered action” means a 

violation of federal criminal law in Title 18 of the United States Code involving fraud, 
63

bribery, or a gratuity violation.

4. Safeguarding of the Information.

a. To the extent permitted by law and regulation, we will:

(1) Safeguard and treat information you disclose to us as confidential if you mark 

the information as “confidential” or “proprietary.”

(2) Not release the information to the public in response to a Freedom of 

Information Act (5 U.S.C. 552) request without notifying you in advance.

b. We may transfer documents you provide to us to any other department or agency 

within the Executive Branch of the Federal Government if the information relates to 

matters within that organization’s jurisdiction.

OAR Article II. Records Retention and Access. 

Section A. Records Retention Period. 

1. Except as provided in Sections B through D of this article:

2. You must keep records related to any real property and equipment acquired, in whole 

or in part, using federal funds under the award for 3 years after final disposition of the 

property. For any item of exempt property with a current fair market value greater than 

$5,000, and for which final disposition was not a condition of the title vesting, you must 

keep whatever records you need for as long as necessary to ensure that you can 

deduct the federal share if you later use the property in contributions for cost sharing or 

matching purposes under any federal award.

3. You must keep records related to rate proposals for indirect or facilities and 

administrative costs, cost allocation plans, and supporting records such as indirect cost 

rate computations and any similar accounting computations of the rate at which a 

particular group of costs is chargeable (such as computer usage chargeback or 

composite fringe benefit rates) as follows:

a. If you are required to submit a proposal, plan, or other computations to your federal

cognizant agency for indirect costs, as the basis for negotiation of a rate, you must 

keep the submissions and all supporting records for 3 years from the date on which 

you were required to make the submissions.

b. If you are not required to submit a proposal, plan, or other computation as the basis 

for negotiation, you must keep the proposal, plan, other computation, and 

supporting records for 3 years from the end of the fiscal year or other accounting 

period covered by the proposal, plan, or other computation.

4. You must keep other financial records, supporting documents, statistical records, and 
64

other records pertinent to NGB CA awards for a period of 3 years from the date you 

submit your final financial report under the award.

Section B. Extensions of Retention Period Due to Litigation, Claim, or Audit.

1. If any litigation, claim, or audit begins before the end of the 3-year retention period 

specified in Section A of this article and the final action related to the litigation, claim, or 

audit is not taken before the end of that 3-year period, you must retain all records 

related to NGB CA awards that may be involved in the litigation, claim, or audit until all 

findings involving the records have been resolved and final action taken.

2. We may disallow costs and recover funds under NGB CA awards based on an audit or 

other review of records during the record retention period, including any extension to 

that retention period that we required in a written notification to you.

Section C. Records for Program Income Earned After the End of the Performance 

Period. 

In accordance with Section F of FMS Article VII, there are no requirements under NGB 

CA awards applicable to program income you earn after the end of the period of 

performance and therefore no associated records retention requirements.

Section D. Records for Joint or Long-term Use.

1. Joint Use. To avoid duplicate recordkeeping for records that you and we both need to 

use on a continuous basis, we may ask you to make special arrangements with us, by 

mutual agreement, to make records available for joint and continuous use.

2. Long-term use. If we determine that some records will be needed longer than the 3-

year period specified in Section A of this article, we may request that you either:

a. Retain the records for a longer time; or

b. Transfer the records to our custody for long-term retention.

3. Retention requirements for transferred records. For any records transferred to our 

custody, you are not subject to the records retention requirements in Section A of this 

article.

Section E. Methods for Collecting, Transmitting, and Storing Information.

1. You should, whenever practicable, collect, transmit, and store information related to 

NGB CA awards in open and machine-readable formats rather than in closed formats 

or on paper. However, if you request it, we will:

a. Provide award related information to you on paper.

b. Accept award related information from you on paper. In that case, we will not 

require more than an original and two copies.
65

2. When your original records are in an electronic form that cannot be altered, you do not 

need to create and retain paper copies of those records.

3. When your original records are on paper, you may substitute electronic versions 

produced through duplication or using other forms of electronic media, provided that:

a. You conduct periodic quality control reviews of the records.

b. You provide reasonable safeguards against alteration of the records.

c. The records remain readable.

Section F. Access to Records.

1. Scope of Government Access Rights.

a. We as the awarding agency, the Federal Government Inspectors General, the 

Comptroller General of the United States, and any of our authorized representatives 

have the right of access to any documents, papers, or other records you have that 

are pertinent to NGB CA awards, to make audits, examinations, excerpts, and 

transcripts.

b. This right also includes timely and reasonable access to your personnel for the 

purposes of interview and discussion related to the records.

c. As described in OMB guidance at 2 CFR 200.337(b), the access to records 

described in this section will include access to the true name of a victim of a crime 

only under extraordinary and rare circumstances.

(1) You are required to provide that access only in response to a court order or 

subpoena pursuant to a bona fide confidential investigation, or in response to a 

request duly authorized by the head of NGB or his or her designee.

(2) You must take appropriate steps to protect this sensitive information.

2. Duration of Government Access Rights. We have the access rights described in 

paragraph F.1 of this section as long as you retain the records.

3. Public access.

a. You must comply with requirements to protect information that Federal statute, 

Executive order, or regulation requires to be protected (e.g., personally identifiable 

or export-controlled information), to include both information generated under NGB 

CA awards and information provided to you and identified as being subject to 

protection. Other than those limitations on dissemination of information, we place 

no restrictions on you that limit public access to your records pertinent to NGB CA 

awards.
66

b. We do not place any requirements on you to permit public access to your records 

separate from any federal, state, local, or tribal statute that may require you to do 

so.

c. The Freedom of Information Act (FOIA, 5 U.S.C. 552) does not apply to records in 

your possession but records you provide to us generally will be subject to FOIA, 

with the applicable exemptions.

OAR Article III. Remedies and Termination. 

Section A. Noncompliance with Award Terms and Conditions. 

If you fail to comply with a term or condition of NGB CA awards or an applicable federal

statute or regulation, we may amend NGB CA awards to impose award-specific 

conditions, as described in OMB guidance in 2 CFR 200.208. If imposing award 

specific conditions, we will notify you before modifying the award and, once you have 

corrected the noncompliance, promptly remove the award-specific conditions. If we 

determine that the imposition of award-specific conditions is insufficient to correct the 

noncompliance or the non-compliance remains uncorrected despite the use of awardspecific conditions, we may consider taking one or more of the remedies specified in 

Section B of this article.

Section B. Remedies for Noncompliance.

1. If you fail to comply with a term or condition of NGB CA awards or an applicable 

Federal statute or regulation, we may take one or more of the following actions that we 

deem appropriate to the circumstances:

a. Temporarily withhold cash payments pending:

(1) Your correction of the deficiency.

(2) Our taking more severe remedies.

b. Disallow (that is, deny both use of funds and any applicable cost-sharing or 

matching credit for) all or part of the cost of the activity or action not in compliance.

c. Suspend or, in accordance with section C.1.a.i. of this article, terminate NGB CA 

awards, in whole or in part (suspension of an award is a separate and distinct 

action from suspension of a person under 2 CFR parts 180 and 1125, as noted in 

Section B.3 of this article).

d. Withhold further awards to you for the project or program that is not in compliance.

e. Take any other action legally available to us under the circumstances.
67

2. You may raise an objection to our taking any remedy we take under Section B.1 of this 

section and will be given an opportunity to provide information and documentation 

challenging the action. The procedures are those specified in OAR Article IV for claims 

and disputes.

3. Our use of any remedy under Section B.1 of this section, including suspension or 

termination of the award, does not preclude our referring the noncompliance to a 

suspension and debarment official and asking that official to consider initiating a 

suspension or debarment action under 2 CFR part 1125, the DoD (NGB)

implementation of OMB guidance at 2 CFR part 180.

Section C. Termination.

1. NGB CA awards may be terminated in whole or in part as follows:

a. Unilaterally by the Federal Government. We will provide a notice of termination if 

we unilaterally terminate NGB CA awards in whole or in part, which we may do for 

either of the following reasons:

(1) Your material failure to comply with the award terms and conditions. If we 

terminate the award for that reason, we will report the termination to the OMBdesignated integrity and performance system (currently FAPIIS). In 

accordance with 41 U.S.C. §2313, each federal awarding official must review 

and consider the information in the OMB-designated integrity and performance 

system regarding any proposal or offer before awarding a grant or contract.

(2) The program office does not have funding for an upcoming increment if NGB

CA awards is incrementally funded. In that case, the Federal Government’s 

financial obligation does not exceed the amount currently obligated under the 

award.

b. By Mutual Agreement. With your consent, we may terminate NGB CA awards, in 

whole or in part, for any reason. In that case, you and we must agree to:

(1) The termination conditions, including the effective date.

(2) In the case of a partial termination, the portion to be terminated.

c. Unilaterally by the Recipient. You may unilaterally terminate NGB CA awards, in 

whole or in part, by sending us written notification that states:

(1) The reasons for the termination.

(2) The effective date.

(3) In the case of partial termination, the portion to be terminated. In that case, 

however, we may terminate the award in its entirety if we determine that the 

remaining portion of the award will not accomplish the purposes for which we 
68

made the award.

2. If an NGB CA award is terminated in its entirety before the end of the performance 

period, you must complete the closeout actions for which you are responsible under 

OAR Article VI. The due date for each action is to be measured relative to the date of 

termination.

3. If an NGB CA award is only partially terminated before the end of the performance 

period, with a reduced or modified portion of the award continuing through the end of 

the performance period, then closeout actions will occur at the end of the performance 

period as specified in OAR Article VI.

4. You will continue to have all the post-closeout responsibilities that OAR Article VII 

specifies for you if an NGB CA award is wholly or partially terminated before the end of 

the performance period.

Section D. Effects of Suspension or Termination of the Award on Allowability of Costs. 

1. If we suspend or terminate NGB CA awards prior to the end of the period of 

performance, costs resulting from obligations that you incurred:

a. Before the effective date of the suspension or termination are allowable if:

(1) You properly incurred those obligations.

(2) You did not incur the obligations in anticipation of the suspension or 

termination.

(3) In the case of termination, the costs resulted from obligations that were 

noncancellable after the termination.

(4) The costs would have been allowable if we had not suspended or terminated 

the award and it had expired normally at the end of the period of performance.

b. During the suspension or after the termination are not allowable unless we 

expressly authorize them, either in the notice of suspension or termination or 

subsequently.

OAR Article IV. Claims, Disputes, and Appeals. 

Section A. Definitions.

1. Claim. The definition of the term “claim,” as it is used in this article, is in 2 CFR 

1108.80.

2. Grant Appeal Authority. RESERVED – Only applicable if provided in DoD 

Component addendum to these terms and conditions.
69

Section B. Submission of Claims.

1. Your claims. To submit a claim arising out of NGB CA awards, you must submit it in 

writing to the grants officer for decision, specify the nature and basis for the relief you 

are requesting, and include all data that supports your claim.

2. Government claims. You will receive a written grants officer’s decision if an NGB

claim arises out of NGB CA awards.

Section C. Alternative Dispute Resolution.

1. We encourage resolution of all issues related to NGB CA awards by mutual agreement 

between you and the grants officer.

2. If you and the grants officer are unable to resolve an issue through unassisted 

negotiations, we encourage use of Alternative Dispute Resolution (ADR) procedures to 

try to do so. ADR procedures are any voluntary means, such as mini-trials or 

mediation, used to resolve issues in controversy. ADR procedures may be used prior 

to submission of a claim or at any other time prior to the Grant Appeal Authority’s 

decision on any appeal you submit.

Section D. Grants Officer Decisions for Claims you Submit.

1. Within 60 calendar days of receiving your claim, the grants officer will either:

a. Transmit a written decision that:

(1) Identifies data on which the decision is based.

(2) Identifies and provides the mailing address for the Grant Appeal Authority to 

whom you will submit an appeal of the decision if you elect to do so; or

b. If more time is required to render a written decision, notify you of a specific date 

when he or she will render the decision and inform you of the reason for delaying it.

2. The grants officer’s decision will be final unless you decide to appeal, in which case we 

encourage use of ADR procedures as noted in Section C of this article.

Section E. Formal Administrative Appeals.

1. Right to Appeal. You have the right to appeal a grants officer’s decision to the Grant 

Appeal Authority identified in Section A of this article.

2. Notice of Appeal. You may appeal a grants officer’s decision within 90 calendar days 

of receiving the decision by submitting a written notice of appeal to the Grant Appeal 

Authority and grants officer. If you elect to use ADR procedures, you are allowed an 

additional 60 calendar days to submit the written notice of appeal.
70

3. Appeal File. Within 30 calendar days of the grants officer’s receipt of your notice of 

appeal, you should receive the appeal file with copies of all documents relevant to the 

appeal. You may supplement the file with other documents you deem relevant and 

with a memorandum in support of your position for the Grant Appeal Authority’s 

consideration. The Grant Appeal Authority may request additional information from 

you.

4. Decision. Unless the Grant Appeal Authority decides to conduct fact-finding 

procedures or an oral hearing on the appeal, the appeal will be decided solely based 

on the written record. Any fact- finding or hearing will be conducted using procedures 

that the Grant Appeal Authority deems appropriate.

Section F. Representation. 

You may be represented by counsel or any other designated representative in any 

claim, appeal, or ADR proceeding, if the representative is not otherwise prohibited by 

law or regulation from appearing before NGB.

Section G. Non-exclusivity of Remedies. 

Nothing in this article is intended to limit your right to any remedy under the law.

Section H. Effect of Grant Appeal Authority’s Decision. 

The Grant Appeal Authority’s decision is the final administrative decision of NGB and 

cannot be further appealed within NGB.

OAR Article V. Collection of Amounts Due. 

Section A. Establishing a Debt.

1. Any amount paid to you more than the amount to which you are determined to be 

entitled under the terms and conditions of NGB CA awards constitutes a debt to the 

Federal Government.

2. The grants officer will attempt to resolve any claim of your indebtedness arising out of 

NGB CA awards by mutual agreement.

3. If the grants officer fails to resolve the claim in that manner, you will receive a written 

notice of the grants officer’s decision formally determining the debt, as described in 

Section B.2 of OAR Article IV. The notice will describe the debt, including the amount, 

name and address of the official who determined the debt, and a copy of that official’s 

determination.

Section B. Debt Delinquency and Appeals.

1. Within 30 calendar days of the grants officer’s decision, you must either pay the 

amount owed to the address provided in the written notice or inform the grants officer 
71

that you intend to appeal the decision. Appeal procedures are described in OAR 

Article IV.

2. If you elect not to appeal, any amounts not paid within 30 calendar days of the grants 

officer’s decision will be a delinquent debt.

3. If you elect to appeal the grants officer’s decision, you will have 90 calendar days after 

receipt of the grants officer’s decision to file your appeal unless Alternative Dispute 

Resolution (ADR) procedures are used, as described in Section C of OAR Article IV, in 

which case you will have 150 calendar days.

Section C. Demand Letter, Interest, and Debt Collection.

1. If within 30 calendar days of the grants officer’s decision, you neither pay the amount 

due nor provide notice of your intent to appeal the grants officer’s decision, the grants 

officer will send you a demand letter identifying a payment office that will be 

responsible for any further debt collection activity.

2. If you do not pay by the due date specified in the written demand letter, the Federal 

Government may collect part or all the debt by:

a. Making an administrative offset against your requests for reimbursements under 

federal awards.

b. Withholding advance payments otherwise due to you.

c. Any other action permitted by federal statute.

3. The debt will bear interest, and may include penalties and other administrative costs, in 

accordance with applicable provisions of NGB Financial Management Regulation (DoD 

7000.14-R), which implements the Federal Claims Collection Standards. The date from 

which interest is computed is not extended by litigation or the filing of any form of 

appeal.

OAR Article VI. Closeout. 

Section A. Liquidation of Financial Obligations. 

Unless the award administration office authorizes an extension of the due date, you 

must liquidate all financial obligations that you incurred under NGB CA awards not later 

than 120 calendar days after the end date of the period of performance.

Section B. Refunds of Unobligated Balances. 

You must promptly refund to the award administration office any balances of 

unobligated cash that we have advanced or paid to you and not authorized you to use 

on other projects or programs.
72

Section C. Final Reports. 

You must submit the:

1. Final performance report under NGB CA awards no later than the date specified in 

Section C of REP Article I, subject to any extensions granted under Section D of that 

article.

2. Final financial report under NGB CA awards no later than the date specified in Section 

C of REP Article II, subject to any extensions granted under Section D of that article.

3. Final report listing subject inventions made under the award no later than the date 

specified in Section B of PROP Article VI.

4. Other final reports that are required under NGB CA awards no later than 120 calendar 

days after the end date of the period of performance, unless you request an extension 

of the due date, and the award administration office approves the request.

Section D. Accounting for Property. 

You must account for any real property, equipment, supplies, and intangible property 

that you and any subrecipients acquired or improved under the award, in accordance 

with PROP Articles I through IV and VI. Your requests for disposition instructions for 

any federally owned property, as required by PROP Article V, meet the need described 

in OMB guidance at 2 CFR 200.344(f) to account for that property at closeout.

Section E. Delinquent Final Reports and Timeframe for Closeout.

1. We intend to closeout NGB CA awards no later than one year after the end date of the 

period of performance.

a. If you or your lower-tier entities (e.g., subrecipients) do not have negotiated final 

indirect costs rates before the due date of the final financial reports, the final reports 

must be based on the best information at the time (e.g., proposed final indirect 

rates). You will have post-closeout continuing responsibilities related to the 

finalization of those rates in accordance with section A.2 of OAR Article VII.

b. If you do not provide timely and/or accurate final reports or do not respond timely to 

our requests to reconcile discrepancies in these reports or other records, we may 

initiate closeout based on information we have on hand. For example, if you fail to 

submit a timely final financial report, we may use amounts provided in the latest 

interim financial report and/or payment request to determine final amounts to be 

paid for closeout purposes.

2. Failure to submit timely and accurate final reports may result in our taking one or more 

remedies as specified in Section B of OAR Article III and reporting your material failure 

to comply with the terms and conditions of NGB CA awards in the OMB-designated 
73

integrity and performance system accessible through SAM (currently FAPIIS).

OAR Article VII. Post-Closeout Adjustments and Continuing Responsibilities. 

Section A. Adjustments. 

The closeout of NGB CA awards does not affect:

1. Our right to disallow costs and recover funds based on a later audit or other review, if

we make the determination that the costs are disallowed and notify you about that 

determination as specified in section B.2 of OAR Article II of these terms and 

conditions.

2. Your obligation to return any funds due to the Federal Government because of later 

refunds, corrections, or other transactions (to include any adjustments in final indirect 

cost rates).

Section B. Continuing Responsibilities. 

After closeout of NGB CA awards, you must continue to comply with terms and 

conditions of NGB CA awards that have applicability beyond closeout, including 

requirements concerning:

a. Audits, as specified in FMS Article V, that cover periods of time during which you 

expended funds under NGB CA awards.

b. Management, use, and disposition of any real property or equipment acquired or 

improved under NGB CA awards in which we continue to have a federal interest 

after closeout, as specified in PROP Articles I through IV.

c. Retention of, and access to, records related to NGB CA awards, as specified in 

OAR Article II.

Part 6: Subawards (Articles from this part are designated with “SUB” in the 

article title)

SUB Article I. Distinguishing Subawards and Procurements. 

Section A. Required Recipient Determination. 

For each transaction into which you enter with another entity at the next tier below NGB 

CA awards, you must determine whether the transaction is a subaward or procurement 

transaction.

Section B. Considerations in Making the Determination.
74

1. The primary purpose of the transaction between you and the other entity is the key 

factor you must use to determine whether the transaction is a subaward or 

procurement transaction.

a. The transaction is a subaward and the other entity, therefore, a subrecipient if the 

transaction’s primary purpose is for you to transfer—for performance by the other 

entity—a portion of the substantive project or program for which we are providing 

financial assistance to you through NGB CA awards. You will continue to be 

accountable to us for performance of the project or program under the award, 

including portions performed by any subrecipients.

b. The transaction is a procurement transaction and the other entity therefore a 

contractor if the transaction’s primary purpose is for you to purchase goods or 

services that you need to perform the substantive project or program supported by 

NGB CA awards. The distinction from a subaward is the contractor is not 

performing a portion of the substantive project or program because of the 

transaction.

2. What you call the transaction is not a factor in distinguishing a subaward from a 

procurement transaction. If the transaction meets the criterion in section B.1.a of this 

article, it is a subaward for purposes of the requirements of NGB CA awards even if 

you call and consider the transaction a “contract.”

Section C. Effect of the Determination on the Next-Tier Transaction.

1. Process for Awarding the Transaction. One important consequence of your 

determining whether a next-tier transaction is a subaward or procurement is that there 

are different requirements governing the pre-award and time of award processes that 

you use to award the transaction.

a. SUB Article II of this Part specifies pre-award and time of award responsibilities for 

subawards.

b. PROC Articles I and II of this Part govern pre-award and time of award processes 

for awarding procurement transactions.

2. Transaction Terms and Conditions. A second important consequence of your 

determining whether a next-tier transaction is a subaward or procurement transaction 

is that the terms and conditions you include in a subaward differ from those you include 

in a procurement transaction.

a. Section C of SUB Article II of this Part addresses requirements you must include in 

subaward terms and conditions. Those requirements are generally either identical 

or directly related to requirements in the general terms and conditions of NGB CA 

awards. They include national policy requirements, as well as administrative 

requirements in areas such as financial and programmatic management, property

administration, procurement, and reporting.
75

b. PROC Article III of these general terms and conditions lists requirements you must 

include in a procurement transaction when applicable.

SUB Article II. Pre-award and Time of Award Responsibilities. 

Section A. Requirements for Unique Entity Identifiers.

1. Definition of “Entity”. For purposes of the unique entity identifier requirements in 

paragraphs A.2 and 3 of this section, “entity” has the meaning given in paragraph C.3 

of appendix A to OMB guidance in 2 CFR part 25.

2. Pre-notification of Potential Subrecipients. You must notify potential subrecipients 

that no entity may receive a subaward from you under NGB CA awards unless it has 

provided its unique entity identifier to you.

3. Restriction on Making Subawards.

a. General. You may not make a subaward to an entity unless the entity has provided 

its unique entity identifier to you, as required in 2 CFR part 25.300. Subrecipients 

are not required to obtain an active SAM registration but must obtain a Unique 

Entity Identifier.

b. Exception. You may make a subaward to an entity that has not provided its 

unique entity identifier to you in rare cases in which you requested, and we 

approved an exemption from the requirement for the entity to provide a unique 

entity identifier, based on the criteria in OMB guidance in 2 CFR part 25.110(c).

Section B. Pre-award Risk Assessment.

1. Before making a subaward to an entity, you must perform a risk assessment of the 

prospective subrecipient, as described in 2 CFR 200.332(b). OMB guidance in 2 CFR 

200.206(c) provides examples of factors you may consider in evaluating risk.

2. As part of the risk assessment under Section B.1 of this article, you must:

a. Verify that neither the prospective subrecipient nor its principals under the proposed 

subaward are excluded or disqualified from participating in the transaction, in 

accordance with requirements in Subpart C of OMB guidance in 2 CFR part 180, as 

implemented by NGB at 2 CFR part 1125; and

b. If warranted by risks you identify, determine whether to impose award-specific terms 

and conditions in the subaward to mitigate the risks.

(1) These award-specific terms and conditions may be in addition to, or differ from, 

the terms and conditions that SUB Articles IV through IX under this Part requires

you to include in subawards.
76

(2) They may include items such as those listed in OMB guidance in 2 CFR 

200.208(c)(1) through (6).

(3) Your procedures for imposing and removing the additional or different 

requirements must comply with the procedural guidance in 2 CFR 200.208(d) 

and (e).

Section C. Subaward Content.

1. Cost-Type Subawards.

a. SUB Article III of this Part specifies informational content that you must include in 

each cost type subaward.

b. SUB Articles IV through VIII specify administrative requirements that you must 

include:

(1) As applicable, in each cost-type subaward to:

(a) A domestic entity (i.e., an entity other than a foreign public entity or a foreign 

organization).

(b) An organizational unit of a foreign organization if that unit has a place of 

business in the United States.

(c) To the maximum extent practicable in each cost-type subaward to either a 

foreign public entity or an organizational unit of a foreign organization that 

does not have a place of business in the United States (regardless of 

whether another organizational unit of that foreign organization has one). 

However, absent our prior approval, you may not allow that foreign entity or 

organization to acquire real property or equipment under a subaward.

c. SUB Article IX of this Part specifies national policy requirements that you must 

include, as applicable, in each cost-type subaward.

d. SUB Article XI of this award specifies requirements that you must include in any 

subaward under which you determine that the subrecipient may make lower-tier 

subawards to other entities.

2. Fixed-Amount Type Subawards. SUB Article XII of this Part specifies informational 

content and administrative and national policy requirements that you must include in 

any fixed amount subaward.

3. Additional Subaward Terms and Conditions. You may include other requirements in 

your subawards that you need to meet your responsibilities under NGB CA awards for 

performance of the project or program (including portions performed by subrecipients) 

and compliance with applicable administrative and national policy requirements.
77

Section D. Subaward and Executive Compensation Reporting. 

You must report subaward obligating actions and information on subrecipients’ 

executive compensation as required by REP Article IV of these general terms and 

conditions.

SUB Article III. Informational Content of Subawards. 

Section A. Informational Content in General. 

You must include in each subaward (and each subsequent modification to a subaward 

that alters the amount of the subaward) the information specified in OMB guidance in 2 

CFR 200.332(a)(1), “Federal Award Identification,” with the clarifications provided in 

Sections B through G of this article.

Section B. Federal Award Identification Number and Award Date. 

The “Federal Award Identification Number” and “Federal Award Date” described in 2 

CFR 200.332(a)(1)(iii) and (iv), respectively, are the award number and award date for 

NGB CA awards to you. You must provide the information in a way that makes it clear 

that the subaward is under NGB CA award.

Section C. Amount of Federal Funds Obligated.

1. The “Amount of Federal Funds Obligated by this action by the pass-through entity to 

the subrecipient” that is described in 2 CFR 200.332(a)(1)(vi) is either:

a. The amount of your obligation to the subrecipient, if the terms and conditions of 

NGB CA awards do not require you to provide any cost sharing or matching for the 

project or program the award supports; or

b. The amount of the federal share of your subaward obligation if NGB CA awards

does require cost sharing or matching, which in that case is the product of:

(1) The federal share of total project costs under NGB CA award to you, as a 

percentage of those total project costs; and

(2) The total amount of project costs obligated for the subaward action.

2. Note that the total project costs of the award and subaward, as used in paragraphs

C.1.b.i and ii of this section, include any cost sharing or matching that you or the 

subrecipient provides to meet any cost sharing or matching requirement under NGB 

CA awards.

Section D. Total Amount Obligated to the Subrecipient. 
78

The “Total Amount of Federal Funds Obligated to the Subrecipient by the pass-through 

entity including the current obligation,” as described in 2 CFR 200.332(a)(1)(vii), is the 

cumulative amount to date of the amounts described in Section C of this article.

Section E. Total Amount of the Federal Award. 

The “Total Amount of the Federal Award committed to the subrecipient by the passthrough entity,” as described in 2 CFR 200.332(a)(1)(viii), is the total amount through 

the end of the subaward that you and the subrecipient mutually agreed upon, to include: 

funding obligated to date, any future anticipated funding increments, and any options 

you may exercise in the future.

Section F. Federal Awarding Agency, Pass-Through Entity, and Awarding Official. 

The “Name of federal awarding agency” and “pass-through entity,” as those terms are 

used in 2 CFR 200.332(a)(1)(x) are NGB and the business name associated with your 

registration in the System for Award Management. In that same section of 2 CFR part 

200, the “awarding official” is the individual in your organization who made the 

subaward.

Section G. Indirect Cost Rate. RESERVED – Not currently applicable to NGB - See 

Subdivision D of this document.

SUB Article IV. Financial and Program Management Requirements for Subawards. 

Section A. Purposes of this Article in Relation to other Articles.

1. This article specifies administrative requirements concerning financial and program 

management that you must include in the terms and conditions of each cost-type 

subaward that you make under NGB CA awards to a domestic entity.

2. It thereby addresses the flow down to subrecipients of requirements with which you 

must comply under FMS Articles I through VII of these general terms and conditions.

3. SUB Article XII of these general terms and conditions addresses which of these 

administrative requirements you must include in any fixed-amount subaward that you 

make, if you are authorized to make fixed-amount subawards under NGB CA awards.

Section B. Financial Management System Standards. 

1. You must include in any subaward you make under NGB CA awards the requirements 

of:

a. Sections A through C of FMS Article I of these general terms and conditions if the 

subrecipient is a state.

b. Sections B and C of FMS Article I if the subrecipient is an institution of higher 
79

education, nonprofit organization, local government, Indian tribe, or for-profit entity. 

Section C. Payments.

1. Subawards to States. You must include the provisions of Section A of FMS Article II 

of these general terms and conditions in each subaward you make to a state.

2. Subawards to Institutions of Higher Education, Nonprofit Organizations, Local 

Governments, Indian Tribes, and For-profit Entities. The following paragraphs 

specify requirements you must include in subawards to institutions of higher education, 

nonprofit organizations, local governments, and Indian tribes.

a. Payment Method.

(1) If you are authorized to request advance payments under NGB CA awards, you 

must authorize a subrecipient to request advance payments unless:

(a) The subrecipient does not maintain, or demonstrate the willingness to 

maintain, written procedures that minimize the time elapsing between its 

receipt of each payment and its disbursement of the funds for project or 

program purposes.

(b) You impose a requirement for the subrecipient to be paid by reimbursement 

because of your risk evaluation of the subrecipient under SUB Article II of 

these general terms and conditions.

(c) The subaward is for construction; or

(d) The subrecipient requests reimbursement of funds after it disburses them 

for project or program purposes.

(2) If you do not authorize advance payments for one of the reasons given in 

Section C.2.a.(1) of this article, you must specify either reimbursement or 

working capital advances as the payment method in accordance with OMB 

guidance in 2 CFR 200.305(b)(3) and (4).

b. Payment Timing and Amount.

(1) Advances. You must limit advance payments to the minimum amounts 

needed and time the payments to be in accordance with the subrecipient’s 

actual, immediate cash requirements in carrying out the project or program 

under the subaward. The timing and amount of your advance payments to the 

subrecipient must be as close as is administratively feasible to the 

subrecipient’s actual disbursements for direct project costs and the 

proportionate share of any allowable indirect costs. Your subawards also must 

include the requirements of sections B.2.b and c of FMS Article II to specify 

costs subrecipients must exclude from amounts of their advance payment 

requests.
80

(2) Reimbursements or Working Capital Advances. You must follow OMB 

guidance in 2 CFR 200.305(b)(3) and (4) concerning timing and amount of 

reimbursements or working capital advances.

c. Frequency of Requests. You must allow the subrecipient to request advance 

payments or reimbursements, including those associated with the working capital 

advance payment method, as often as it wishes if you pay using electronic funds 

transfers and at least monthly otherwise.

d. Other Requirements.

(1) In any subaward that was subject to our consent, you must include the 

requirements of Section B.5 of FMS Article II of these general terms and 

conditions concerning withholding of payments.

(2) You must include the provisions of Section B.6 of FMS Article II concerning 

depositories in each subaward that authorizes the subrecipient to request 

advance payments.

Section D. Allowable Costs, Period of Availability of Funds, and Fee and Profit.

1. You must include in each subaward a requirement that the allowability of costs under 

the subaward (and any lower tier subawards or procurement transactions into which 

the subrecipient enters) must be determined in accordance with the applicable cost 

principles identified in Section A of FMS Article III of these general terms and 

conditions.

2. You must specify in each subaward the period of availability of funds for any project or 

program purpose so that the period neither begins before nor ends after the period 

during which you may use funds available to you under NGB CA awards for that same 

project or program purpose.

3. You must include in each subaward the provisions concerning fee or profit that are in 

Section D of FMS Article III of these general terms and conditions.

Section E. Revision of budget and program plans. 

You must include in each subaward provisions requiring the subrecipient to request 

your approval for any change in the subaward budget or program that would cause a 

budget or program change under NGB CA awards for which Section B of FMS Article 

IV requires you to first obtain our prior approval. You may not approve any budget or 

program revision that is inconsistent with the purpose or terms and conditions of NGB 

CA awards.

Section F. Non-Federal audits. 

You must include a provision in each subaward that you make under NGB CA awards
81

to require the subrecipient entity to comply with the audit requirements applicable to 

that entity, as specified in either Section A or Section B of FMS Article V.

Section G. Cost sharing or matching requirements. 

1. If you make a subaward under which the subrecipient may provide contributions or 

donations of cash or third-party in-kind contributions to be counted toward any cost 

sharing or matching that is required under NGB CA awards, you must include 

provisions in that subaward to specify:

2. The criteria governing the allowability as cost sharing or matching of the types of cash 

or third-party in-kind contributions that the subrecipient may contribute or donate. 

Those criteria are specified in Sections B through D of FMS Article VI of these general 

terms and conditions if the subaward is to a state, institution of higher education, 

nonprofit organization, local government, Indian tribe, or a for-profit entity.

3. The methods for determining and documenting the values of those contributions or 

donations to be counted as cost sharing or matching. Those methods are specified in

Sections E and F of FMS Article VI of these general terms and conditions if the 

subaward is to a state, institution of higher education, nonprofit organization, local 

government, Indian tribe, or a for-profit entity.

Section H. Program Income. 

You must include requirements concerning program income in subawards, as follows:

a. In each subaward to a state, institution of higher education, nonprofit organization, 

local government, Indian tribe, or for-profit entity.

b. You must require the subrecipient to account to you when it earns any program 

income under the subaward or uses it, so that you can prepare reports you are 

required to submit to us. If the award-specific terms and conditions of NGB CA 

awards require you to account for program income earned after the period of 

performance, you must include a corresponding requirement in your subawards.

c. You must include the provisions of Sections A through D of FMS Article VII of these 

general terms and conditions.

d. You may specify the deduction, addition, or cost sharing or matching alternative or a 

combination of those alternatives, for the subrecipient’s use of any program income 

it earns. However, you still must comply with the alternative specified in Section E 

of FMS Article VII and any applicable award-specific terms and conditions for the 

total amount of program income earned, which includes amounts earned by you 

and your subrecipients. For example, if we require you to use the deduction 

alternative, you may authorize a subrecipient to use the addition alternative if you 

reduce the funding allocated for portions of the project or program that you or other 

subrecipients perform to make the required reduction in the total award amount.
82

SUB Article V. Property Requirements for Subawards. 

Section A. Purposes of this Article in Relation to other Articles.

1. This article specifies administrative requirements concerning property that you must 

include in the terms and conditions of each cost-type subaward that you make under 

NGB CA awards.

2. It thereby addresses the flow down to subrecipients of requirements with which you 

must comply under PROP Articles I through VI of these general terms and conditions.

3. SUB Article XII of these general terms and conditions addresses which of these 

administrative requirements you must include in any fixed-amount subaward that you 

make, if you are authorized to make fixed-amount subawards under NGB CA awards.

Section B. Title to Property.

1. Subawards to Institutions of Higher Education, Nonprofit Organizations, States, 

Local Governments, Indian Tribes, or For-profit Entities.

General. You must include terms and conditions in each subaward to flow down to 

the subrecipient the provisions of:

(1) Section A.1 of PROP Article I concerning vesting of title to property acquired 

under the subaward unless Section B.1.b of this section provides otherwise.

(2) Sections B through E of PROP Article I that are applicable to types of property 

that the subrecipient may acquire, improve, donate, or for which it may 

otherwise be accountable under the subaward.

2. Exceptions. RESERVED - Only applicable if provided in award-specific terms and 

conditions.

Section C. Property Management System. 

1. If you make a subaward under which the subrecipient either may acquire or improve 

equipment or real property, or may be accountable for federally owned property, you 

must include in the subaward:

2. If the subrecipient is a state, applicable provisions of:

a. Section A of PROP Article II concerning insurance for real property and equipment.

b. Section B of PROP Article II concerning other property management system 

standards.

3. If the subrecipient is an institution of higher education, nonprofit organization, local 
83

government, Indian tribe, or for-profit entity, applicable provisions of:

a. Section A of PROP Article II concerning insurance for real property and equipment.

b. Section C of PROP Article II concerning other property management system 

standards.

Section D. Use and Disposition of Real Property. 

If you make a subaward under which the subrecipient may acquire or improve real 

property, then you must include in the subaward:

a. Use. The requirements concerning use of real property:

In Section A of PROP Article III if the subaward is to an institution of higher 

education, nonprofit organization, state, local government, Indian tribe, or for-profit 

entity, unless the award-specific terms and conditions of NGB CA awards provide 

otherwise.

b. Disposition. Provisions to require the subrecipient to request disposition 

instructions through you when the property is no longer needed for its originally 

authorized purpose, so that you can meet your responsibilities to us under Section 

B of PROP Article III to address the federal interest in the property.

Section E. Use and Disposition of Equipment and Supplies. 

1. If you make a subaward under which the subrecipient may acquire or improve 

equipment, or acquire supplies, you must include in the subaward, as applicable:

2. If the subaward is to a state:

a. The requirements in Sections B and E of PROP Article IV concerning use and 

disposition of equipment and supplies.

b. Provisions such as those in Section A of PROP Article IV that make clear the 

applicability of those requirements.

3. If the subaward is to an institution of higher education, nonprofit organization, local 

government, Indian tribe, or for-profit entity:

a. The requirements in Sections C and E of PROP Article IV concerning use of 

equipment and use and disposition of supplies.

b. Provisions such as those in Section A of PROP Article IV that make clear the 

applicability of those requirements.

c. Provisions to require the subrecipient to request disposition instructions from you 

when equipment is no longer needed for its originally authorized purpose, so that 

you can meet your responsibilities to us under Section D of PROP Article IV to 
84

address the federal interest in the equipment.

Section F. Use and Disposition of Federally Owned Property. 

If you make a subaward under which the subrecipient may be accountable for federally 

owned property, you must include subaward provisions specifying that the 

subrecipient:

a. May use the property as specified in Section A.1 of PROP Article V;

b. Must submit requests through you for the award administration office’s approval to 

use the property for other purposes, as described in Section A.2 of PROP Article V;

c. Must request the award administration office’s disposition instructions through you 

when the property is no longer needed for subaward purposes or the subaward 

ends.

Section G. Intangible Property. 

You must include in a subaward provisions specifying the requirements of Sections A 

through D of PROP Article VI if the subaward is to an institution of higher education, 

nonprofit organization, state, local government, Indian tribe, or for-profit entity.

SUB Article VI. Procurement Procedures to Include in Subawards. 

Section A. Purposes of this Article in Relation to other Articles.

1. This article specifies administrative requirements concerning procurement procedures 

that you must include in the terms and conditions of each cost-type subaward that you 

make NGB CA awards.

2. It thereby addresses the flow down to subrecipients of requirements with which you 

must comply under PROC Articles I through III of these general terms and conditions.

3. SUB Article XII of these general terms and conditions addresses which of these 

administrative requirements you must include in any fixed-amount subaward that you 

make, if you are authorized to make fixed-amount subawards under NGB CA awards.

Section B. Subaward to a State. 

In any subaward that you make to a state, you must include the requirements of PROC 

Article I and applicable sections of PROC Article III of these general terms and 

conditions.

Section C. Subaward to an Institution of Higher Education, Nonprofit Organization, 

Local Government, Indian Tribe, or For-profit Entity. 
85

1. In any subaward that you make to an institution of higher education, nonprofit 

organization, local government, Indian tribe, or for-profit entity:

a. You must include the requirements of Sections A through G of PROC Article II and 

applicable sections of PROC Article III of these general terms and conditions.

b. You must include the requirement for the subrecipient to make available to you, 

upon request:

(1) Technical specifications of proposed procurement transactions, under the 

conditions described in OMB guidance at 2 CFR 200.325(a).

(2) Other procurement documents for pre-procurement review, under the 

conditions described in OMB guidance at 2 CFR 200.325(b).

2. If it is possible that, under a subaward you make, the subrecipient may award a 

construction or facility improvement contract with a value in excess of the simplified 

acquisition threshold, you must include provisions in the subaward to require the 

subrecipient to comply with at least the minimum requirements for bidders’ bid 

guarantees and contractors’ performance and payment bonds described in 2 CFR 

200.326(a) through (c), unless you determine that the subrecipient’s bonding policy 

and requirements are adequate to protect federal interests.

SUB Article VII. Financial, Programmatic, And Property Reporting Requirements for 

Subawards. 

Section A. Purposes of this Article in Relation to other Articles.

1. This article specifies administrative requirements concerning reporting that you must 

include in the terms and conditions of each cost-type subaward that you make under 

NGB CA awards.

2. It thereby addresses the flow down to subrecipients of requirements with which you 

must comply under REP Articles I through III of these general terms and conditions.

3. SUB Article XII of these general terms and conditions addresses which of these 

administrative requirements you must include in any fixed-amount subaward that you 

make, if you are authorized to make fixed-amount subawards under NGB CA awards.

Section B. Performance Reporting.

1. You must include terms and conditions in each subaward to require the subrecipient to 

provide any performance information you need, by the time you need it, to comply with 

the performance reporting requirements in REP Article I and other terms and 

conditions of NGB CA awards.

2. You may specify a form, format, or data elements the subrecipient must use to provide 
86

the information to you (you need not require the subrecipient to use the same form, 

format, or data elements that REP Article I specifies for your reporting to us).

Section C. Financial Reporting.

1. You must include terms and conditions in each subaward to require the subrecipient to 

provide any financial information you need, by the time you need it, to comply with the 

financial reporting requirements in REP Article II and other terms and conditions of 

NGB CA awards.

2. You may specify a form, format, or data elements the subrecipient must use to provide 

the information to you (you need not require the subrecipient to use the same form, 

format, or data elements that REP Article II specifies for your reporting to us).

Section D. Reporting on Property.

1. Each subaward you make under NGB CA awards must include provisions concerning 

property reporting as described in section D.2 of this section if the subrecipient may, 

under the subaward:

a. Acquire or improve real property or equipment;

b. Acquire supplies or intangible property; or

c. Be accountable for federally owned property.

2. The subaward provisions must require the subrecipient to give you the information you 

need about the property to meet your responsibilities to us under Sections A through D 

of REP Article III and PROP Articles II through VI.

SUB Article VIII. Other Administrative Requirements for Subawards. 

Section A. Purposes of this Article in Relation to other Articles.

1. This article specifies other administrative requirements that you either must or should 

include in the terms and conditions of each cost-type subaward that you make under 

NGB CA awards.

2. It thereby addresses the flow down to subrecipients of requirements with which you 

must comply under OAR Articles I through VII of these general terms and conditions.

3. SUB Article XII of these general terms and conditions addresses which of these 

administrative requirements you must include in any fixed-amount subaward that you 

make, if you are authorized to make fixed-amount subawards under NGB CA awards.

Section B. Submission and Maintenance of Subrecipient Information. 
87

You must include the substance of the provision in Section C of OAR Article I in any 

subaward you make under NGB CA awards. The provision must require the 

subrecipient’s disclosure of any evidence directly to the Inspector General, DoD.

Section C. Records Retention and Access. 

1. In each subaward you make under NGB CA awards:

a. If the subaward is to an institution of higher education, nonprofit organization, state, 

local government, Indian tribe, or for-profit entity:

(1) You must include the requirements of Section A of OAR Article II with the 

additional condition that, for any subrecipient under NGB CA awards that does 

not have a federally approved rate for indirect or facilities and administrative 

costs and that does not use the de minimis rate described in 2 CFR 200.414(f), 

you must:

(a) Require the subrecipient to keep records that support its indirect or facilities 

and administrative costs charged to the subaward for 3 years from the end 

of the fiscal year (or other accounting period) to which the costs apply.

(b) Keep any plan or computation the subrecipient submits to you to serve as a 

basis for your determining the reasonableness and allowability of indirect or 

facilities and administrative costs of the subaward, for 3 years from the end 

of the fiscal year (or other accounting period) to which the proposal, plan, 

or computation applies.

b. You must include the requirements of Sections B, C, and F of OAR Article II.

c. You must include provisions that enable you to comply with the requirements of 

Section D of OAR Article II concerning records for joint or long-term use.

d. You must include provisions that establish the same rights and responsibilities for 

the subrecipient under the subaward that Section E of OAR Article II establishes for 

you under these general terms and conditions.

e. You may not impose any other record retention or access requirements on the 

subrecipient.

Section D. Remedies and Termination. 

1. The terms and conditions of each subaward you make under NGB CA awards should 

specify your rights and responsibilities and those of the subrecipient if you take a 

remedial action to address a subrecipient’s noncompliance with an applicable federal

statute or regulation or the terms and conditions of your subaward. Each subaward’s 

terms and conditions should:

2. Identify remedial actions you may take to address the subrecipient’s noncompliance. 
88

Available remedies are described in OMB guidance in 2 CFR 200.339 for a subaward 

to an institution of higher education, nonprofit organization, state, local government, 

Indian tribe, or for-profit entity.

3. With respect to termination specifically:

a. Identify conditions under which you, the subrecipient, or both (by mutual agreement) 

may terminate the subaward, in whole or in part, as described in:

OMB guidance in 2 CFR 200.340(a) for a subaward to an institution of higher 

education, nonprofit organization, state, local government, Indian tribe, or for-profit 

entity.

b. Inform the subrecipient that you will provide it with a notice of termination if you 

unilaterally terminate the award.

c. Specify that you and the subrecipient remain responsible for applicable 

requirements addressed in Sections G and H of this article concerning closeout, 

post-closeout adjustments, and continuing responsibilities.

4. With respect to either suspension or termination of the subaward, inform the 

subrecipient about the criteria that you will use to either allow or disallow subaward 

costs, which are in Section D of OAR Article III for a subaward to an institution of 

higher education, nonprofit organization, state, local government, Indian tribe, or forprofit entity.

Section E. Disputes, Hearings, and Appeals. 

Each subaward’s terms and conditions should specify any rights the subrecipient has to 

a hearing, appeal, or other administrative proceeding if it disputes a decision you render 

in administering its subaward. You must comply with any statute or regulation that 

affords the subrecipient an opportunity for a hearing, appeal, or other administrative 

proceeding and is applicable to the dispute.

Section F. Collection of Amounts Due. 

Although your subaward terms and conditions do not need to include any of the 

requirements of OAR Article V because those requirements do not flow down to 

subrecipients, you should consider including provisions to specify what you would need 

from the subrecipient if you owed a debt to the Federal Government under NGB CA 

awards that is related to its subaward.

Section G. Closeout.

In each subaward that you make to an institution of higher education, nonprofit 

organization, state, local government, Indian tribe, or for-profit entity, you must include 

provisions to require the subrecipient to:
89

a. Liquidate all obligations that it incurred under the subaward not later than 90 

calendar days after the end date of the period of performance of either the 

subaward or NGB CA awards, whichever is earlier, unless you grant an extension.

b. Promptly refund to you any balances of unobligated cash that you advanced or paid 

to the subrecipient unless you received authorization from the award administration 

office for the subrecipient’s use of those funds on other projects or programs.

c. Submit to you:

(1) Any information you need from the subrecipient to meet your responsibilities to 

us for an accounting of property, under Section D of OAR Article VI.

(2) Not later than 90 calendar days after the end date of the period of performance 

of NGB CA awards, unless you grant the subrecipient an extension, any 

information you need to meet your responsibilities to us for final reports, under 

Section C of OAR Article VI.

Section H. Post-Closeout Adjustments and Continuing Responsibilities.

You must include provisions in each subaward to require the subrecipient to provide 

what you need to comply with the requirements of OAR Article VII.

SUB Article IX. National Policy Requirements for Subawards. 

Section A. General.

1. You must include provisions in the terms and conditions of each subaward you make to 

require the subrecipient entity’s compliance with each of the national policy 

requirements in Sections B through E of this article that you determine is applicable, 

given the type of entity receiving the subaward and activities it will be carrying out 

under the subaward.

2. If an entity to which you are about to make a subaward will not accept an award 

provision requiring its compliance with a national policy requirement that you determine 

to be applicable, you must alert the award administration office immediately. You may 

not omit an applicable national policy requirement to make the subaward.

3. If at any time during the performance of a subaward, you learn that—or receive a 

credible allegation that—the subrecipient is not complying with an applicable national 

policy requirement, you must alert the award administration office immediately.

Section B. Nondiscrimination National Policy Requirements. 

You must include provisions in each subaward to require the subrecipient’s compliance 

with the nondiscrimination national policy requirements specified in sections A.1 through 
90

A.5 of NP Article I, as applicable.

Section C. Environmental National Policy Requirements. 

You must include provisions in each subaward to require that:

a. The subrecipient complies with all applicable federal environmental laws and 

regulations, including those specified in Sections A.2, A.3, A.5, and A.6 of NP 

Article II, as applicable.

b. Provide any information you need, when you need it, to comply with the 

requirement to immediately notify us of potential environmental impacts specified 

in Sections A.4, A.5, and A.6 of NP Article II, as applicable, due to activities under 

the award (which includes subaward activities).

Section D. National Policy Requirements Concerning Live Organisms. RESERVED –Not 

applicable.

Section E. Other National Policy Requirements. 

1. You must include provisions in each subaward to require the subrecipient’s compliance 

with the national policy requirements in the following portions of NP Article IV of these 

general terms and conditions, as applicable:

a. Section A.1.

b. Sections A.3.a and A.3.b.

c. Sections A.4 through A.19.

d. Section B.1.

SUB Article X. Subrecipient Monitoring and other Post-Award Administration. 

Section A. General Requirement for Subrecipient Monitoring. 

1. You must do the post-award monitoring of the subrecipient’s activities under each 

subaward that is needed for you to ensure that:

a. The subrecipient carries out the portion of the substantive project or program under 

NGB CA awards for which the subaward was made.

b. The subrecipient is using project funds under the subaward (including any cost 

sharing or matching the subrecipient provides that is counted as project funds in the 

approved budget of NGB CA awards) for authorized purposes.

c. The subrecipient’s performance under the subaward is in compliance with 
91

applicable federal statutes and regulations, and the terms and conditions of your 

subaward.

Section B. Subrecipient Monitoring Actions.

1. Required Monitoring Actions. You must, as part of your post-award monitoring of 

each subrecipient:

a. Review the financial and programmatic information that your subaward terms and 

conditions require the subrecipient to provide, in accordance with Sections B and C 

of SUB Article VII of these general terms and conditions.

b. Follow up and ensure that the subrecipient takes timely and appropriate action to 

remedy deficiencies detected through any means, including audits and on-site 

reviews.

c. With respect to audits of subrecipients that are required under FMS Article V of 

these general terms and conditions:

(1) Verify that the subrecipient is audited in accordance with those requirements, 

as applicable (note that Section F of SUB Article IV requires you to include 

those audit requirements for the subrecipient in the subaward’s terms and 

conditions).

(2) Resolve and issue a management decision for audit findings that pertain to your 

subaward. Doing so is a requirement under either Section A or B of FMS Article 

V of these general terms and conditions (Section B requires that explicitly and 

Section A does so by implementing OMB guidance in 2 CFR 200.521, as well 

as other portions of Subpart F of that part).

(3) Consider whether you need to adjust your own records related to NGB CA 

awards based on results of audits, on-site reviews, or other monitoring of the 

subrecipient and, as applicable, notify the award administration office.

2. Other Monitoring Actions. OMB guidance in 2 CFR 200.332(e)(1) through (3) 

describes other actions that may be useful as part of your subrecipient monitoring 

program, depending on the outcomes of the pre-award risk assessment you conducted 

in accordance with Section B of SUB Article II.

Section C. Remedies and Subaward Suspension or Termination. 

1. With respect to any subaward under NGB CA awards, you must:

a. Consider whether you need to take any remedial action if you determine that the 

subrecipient is noncompliant with an applicable federal statute or regulation or the 

terms and conditions of your subaward, as described in Section D of SUB Article 

VIII.
92

b. Provide a notice of termination to the subrecipient if you terminate its subaward 

unilaterally for any reason prior to the end of the period of performance.

c. In the case of either suspension or termination of a subaward prior to the end of the 

period of performance, allow or disallow subaward costs in accordance with Section 

D of OAR Article III.

Section D. Subaward Closeout.

1. You will close out each subaward when you either:

a. Determine that the subrecipient has completed its programmatic performance under 

the subaward and all applicable administrative actions; or

b. Terminate the subaward if you do so prior to completion of the subrecipient’s 

programmatic performance.

2. With respect to the closeout of each subaward:

a. You must pay the subrecipient promptly for allowable and reimbursable costs.

b. Consistent with the terms and conditions of the subaward, you must make a 

settlement for any upward or downward adjustments to the federal share of project 

costs after you receive the information you need from the subrecipient to close out 

the subaward.

c. You should complete the closeout of the subaward no later than one year after you 

receive and accept the final reports and other information from the subrecipient that 

you need to close out the subaward.

SUB Article XI. Requirements Concerning Subrecipients’ Lower-tier Subawards. 

Section A. Purpose. 

This article specifies requirements you must include in any cost-type subaward under 

which you determine that the subrecipient may make lower-tier cost-type subawards to 

other entities.

Section B. Requirements for Lower-tier Subawards. 

Your subaward terms and conditions must require your subrecipient, with respect to each 

lower-tier cost-type subaward that it makes to:

1. Ensure that the lower-tier transaction is a subaward, rather than a procurement 

transaction, by making the determination that SUB Article I of these general terms and 

conditions requires you to make.
93

2. Conduct the pre-award risk assessment of its intended subrecipient that Section B of 

SUB Article II of these general terms and conditions requires you to make for your 

subawards.

3. Include in any cost-type subaward it makes at the next tier:

a. The informational content that SUB Article III specifies.

b. The administrative requirements that SUB Articles IV through VIII of these general 

terms and conditions specify.

c. The national policy requirements that SUB Article IX of these general terms and 

conditions specifies, as applicable.

d. The requirements of this article if the next-tier subrecipient may make even lowertier cost-type subawards to other entities.

4. Carry out the subrecipient monitoring and other post-award administration 

responsibilities specified in SUB Article X.

SUB Article XII. Fixed Amount Subawards. 

Section A. Limitations on Use.

1. You may not use a fixed amount subaward:

a. If the total value over the life of the subaward will exceed the simplified acquisition 

threshold.

b. Unless the project or program scope is specific, with definite outcomes, and you can

establish a reasonable estimate of the actual costs of accomplishing those 

outcomes.

c. If you will predetermine a set amount or percentage of cost sharing or matching that 

the subrecipient must provide under the subaward.

d. If the subrecipient will acquire any real property or equipment under the subaward.

2. For fixed amount subawards not prohibited by paragraph 1 of this section and except 

as provided in Section B of this article, you must obtain our prior approval before 

making a fixed amount type of subaward.

a. If Section B of FMS Article IV requires you to obtain our prior approval before you 

make any subaward, and you do not identify the subaward as a fixed amount 

subaward when you obtain that approval, then you must subsequently request 

separate approval before awarding it as a fixed amount type of subaward.
94

b. If a subaward is identified as a fixed amount type of subaward in the budget you 

submit for our approval, then our approval of the budget is the required prior 

approval.

Section B. Fixed Amount Subawards that do not Require Prior Approval. 

1. You are not required to obtain our prior approval before using a fixed amount type of 

subaward if:

a. The subaward is to either:

b. A foreign public entity; or

c. An organizational unit of a foreign organization, if that unit does not have a place of 

business in the United States, regardless of whether another organizational unit of 

that foreign organization has one.

2. You determine that the portion of the project or program under NGB CA awards which 

the subrecipient will be carrying out under the subaward has one or more specific 

outcomes with the following characteristics:

a. You can define the outcomes well enough to specify them at the time you make the 

subaward. Note that:

(1) Outcomes are distinct from inputs needed to achieve the outcomes, such as 

amounts or percentages of time that subrecipient employees or other 

participants will spend on the project or program.

(2) The inherently unpredictable nature of basic or applied research makes it 

rarely, if ever, possible to define specific research outcomes in advance, which 

makes fixed amount subawards inappropriate for research. Note that technical 

performance reports serve to document research outcomes but are not 

themselves outcomes, notwithstanding the definition of “performance goals” in 

OMB guidance at 2 CFR 200.1.

b. The accomplishment of each outcome will be observable and verifiable by you 

when it occurs, so that you will not need to rely solely on the subrecipient’s 

assurance of that accomplishment.

c. The subrecipient associates its estimated costs with outcomes in the proposal it 

submits to you, and you are confident that the costs of accomplishment of the 

outcomes will equal or exceed the subaward amount. This requires either that you 

have a high degree of confidence:

(1) In your estimate of the costs associated with accomplishing the well-defined 

and observable outcomes, based on the prospective subrecipient’s proposal 

(and using the applicable cost principles in FMS Article III as a guide); or
95

(2) That those costs will be within a finite range, rather than a specific amount, so 

that you may provide an amount of funding under the subaward that does not 

exceed the lower end of the range, with the provision that the subrecipient 

agrees to provide any balance above that amount that ultimately is needed to 

accomplish the outcomes. Your subaward then would include a term or 

condition to reflect the subrecipient’s agreement to provide that balance (which 

would be in an amount to be post-determined when the outcomes are 

accomplished). Note that this is distinct from a situation in which you 

predetermine a set amount or percentage of cost sharing or matching that the 

subrecipient must provide under its subaward, a situation in which section A.1.c 

of this article prohibits use of a fixed amount subaward.

3. The subaward is based on a fixed rate per unit of outcome (or “unit cost”) and you 

have both the confidence:

a. That is described in Section B.2.c of this article in the estimated costs associated

with each unit of outcome.

b. In the subrecipient’s guarantee that it can accomplish at least the number of units of 

outcome on which your total subaward amount will be based (i.e., the product of the 

unit cost and the number of units of outcome the subrecipient guarantees to 

accomplish).

c. Note, however, that not every fixed rate subaward is also a fixed amount subaward. 

If you have confidence in the unit cost but not also in the subrecipient’s ability to 

guarantee the number of units of outcome that it will accomplish, then you should 

set a not-to-exceed award amount based on the number of units desired and 

reduce the subaward amount at the end if the subrecipient accomplishes fewer than 

that number. Examples of activities for which it may be appropriate to award this 

type of fixed rate subaward that is not a fixed amount subaward include:

(1) A clinical trial for which the unit cost is the cost of treating each participant. The 

not-to exceed amount would be based on the number of participants the 

subrecipient planned to recruit and the final award on the number who 

participated, documentation for which would be subject to audit.

(2) Labor costs for performance of a portion of the project or program under NGB 

CA awards by an organization or entity that treats its indirect cost rate as 

proprietary information. The unit cost in that case may be “loaded” labor rates 

for the organization’s or entity’s employees that include indirect costs. The final 

award amount would depend on the number of labor hours the organization’s or 

entity’s employees expended under the subaward, documentation for which 

may be audited without exposing proprietary details associated with the actual 

costs.

Section C. Informational Content of Fixed Amount Subawards. 

You must include in each fixed amount subaward the informational content, other than 
96

the indirect cost rate, that is described in SUB Article III of these general terms and 

conditions.

Section D. Terms and Conditions Addressing Administrative Requirements.

1. General. This section:

a. Specifies the minimum set of terms and conditions (in lieu of the more extensive 

set specified in SUB Articles IV through X for cost-type subawards) addressing 

administrative requirements that you must include in each fixed-amount subaward:

(1) To an entity other than a foreign organization, as applicable.

(2) To the maximum extent practicable, to a foreign organization.

b. Does not preclude the inclusion of other requirements that you need to meet your 

responsibilities under NGB CA awards for performance of the project or program 

and compliance with applicable administrative requirements.

2. Financial and Program Management Requirements.

a. Financial Management System Standards. For a subaward to other than a forprofit entity, your subaward must require the subrecipient to include the information 

specified in section B.1 of FMS Article I in its financial management system, for the 

purposes of the non-federal audits required by section 2.d of this section.

b. Payments. Your payments must be based on accomplishment of the outcomes 

and associated costs that you used to establish the subaward amount, rather than 

on subrecipient expenditures for project or program purposes. Milestone 

payments before the end of the subaward’s period of performance may be 

appropriate if there are outcomes that the subrecipient will accomplish at different 

times during that period.

c. Revision of Budget and Program Plans. If our prior approval was required under 

section A.2 of this article for use of a fixed-amount type of subaward, then you 

must:

(1) Request our prior approval for any change in principal investigator, project 

leader, project partner, or scope or objective of the subaward.

(2) Therefore, include a requirement in the subaward for the subrecipient to 

request that approval through you.

d. Non-Federal Audits. You must include the requirement for non-federal audits 

described in Section F of SUB Article IV. The audits are intended to focus on 

compliance with the performance requirements in the subaward terms and 

conditions and not to review actual costs as they would for a cost-type subaward.
97

e. Certification of completion. You must include the requirement for the 

subrecipient to provide you with a certification at the end of the project as specified 

in 2 CFR 200.201(b)(3).

3. Property Requirements.

a. Federally Owned Property. If the subrecipient will be accountable for federally 

owned property, you must include the property management system, use, and 

disposition requirements described in Sections C and F of SUB Article V that are 

applicable to federally owned property.

b. Intangible Property. You must include the applicable intangible property 

requirements described in Section G of SUB Article V.

4. Reporting Requirements. You must include requirements for reporting that you need 

to meet your responsibilities under NGB CA awards for reporting to us.

5. Other Administrative Requirements.

a. Integrity-Related Information. You must include the substance of the provision in 

Section C of OAR Article I in any subaward you make under NGB CA awards. The 

provision must require the subrecipient’s disclosure of any evidence directly to the 

Inspector General, DoD.

b. Records Retention and Access. You must include the requirements for records 

retention and access in section A.3 and Sections B and F of OAR Article II, as 

applicable, if the subaward is to an institution of higher education, nonprofit 

organization, state, local government, Indian tribe, or for-profit entity. You may not 

impose any other records retention or access requirements on the subrecipient.

c. Remedies and Termination. You must include:

(1) The requirements concerning remedies and termination that are described in 

Sections D.1 and 2 of SUB Article VIII.

(2) Provisions addressing any hearing and appeal rights the subrecipient has, as 

described in Section E of SUB Article VIII.

(3) Terms and conditions addressing adjustment of the amount of the subaward if 

it is terminated before the subrecipient accomplishes all the specified 

outcomes.

d. Continuing Responsibilities. You must include requirements concerning 

continuing responsibilities for audits and records retention and access that are 

described in Sections B.1 and B.3 of OAR Article VII.

e. Collection of amounts Due. You should consider including requirements 
98

concerning collection of amounts due, as described in Section F of SUB Article 

VIII.

Section E. National Policy Requirements for Fixed Amount Subawards. 

You must include in the terms and conditions of each fixed amount subaward the 

national policy requirements that SUB Article IX of these general terms and conditions

specifies, as applicable.

Section F. Subrecipient Monitoring and Other Post-Award Administration. 

You must carry out the subrecipient monitoring and post-award administration actions 

specified in SUB Article X, as applicable.

Section G. Fixed amount subawards at Lower Tiers.

1. Authority.

a. If Section B of this article authorizes you to use a fixed-amount type of subaward 

without our prior approval in some situations, a cost-type subaward that you make 

may authorize the subrecipient to use fixed-amount subawards at the next lower tier 

in those same situations without our prior approval.

b. If you wish to allow a subrecipient of a cost-type subaward to use fixed amount 

subawards at the next tier in other situations (i.e., situations in which this article 

requires you to obtain our prior approval before using a fixed-amount type of 

subaward), your subaward terms and conditions must require the subrecipient to 

submit a request through you to obtain our prior approval for use of that type of 

subaward.

2. Subaward Requirements. If your subrecipient is authorized to use lower tier, fixed

amount subawards, as described in paragraphs 1.a and 1.b of this section, your 

subaward’s terms and conditions must:

a. Require the subrecipient, before it makes any lower tier, fixed amount subaward, to:

(1) Ensure that the lower-tier transaction is a subaward, rather than a procurement 

transaction, by making the determination that SUB Article I of these general 

terms and conditions requires you to make.

(2) Conduct the pre-award risk assessment of its intended subrecipient that Section 

B of SUB Article II of these general terms and conditions requires you to make 

for your subawards.

b. Include the requirements specified in Sections A through F of this article.
99

SUBDIVSION C - General Terms and Conditions for National Policy 

Requirements

Part 1: National Policy Requirements (Articles from this part are 

designated with “NP” in the article title)

NP Article I. Nondiscrimination National Policy Requirements. 

Section A. Cross-Cutting Nondiscrimination Requirements. 

By signing NGB CA award or accepting funds under NGB CA awards, you assure that 

you will comply with applicable provisions of the national policies prohibiting 

discrimination:

a. On the basis of race, color, or national origin, in Title VI of the Civil Rights Act of 

1964 (42 U.S.C. 2000d et seq.), as implemented by Department of Defense (DoD) 

regulations at 32 CFR part 195.

b. On the basis of gender, blindness, or visual impairment, in Title IX of the Education 

Amendments of 1972 (20 U.S.C. 1681 et seq.), as implemented by DoD regulations 

at 32 CFR part 196.

c. On the basis of age, in the Age Discrimination Act of 1975 (42 U.S.C. 6101 et seq.), 

as implemented by Department of Health and Human Services regulations at 45 

CFR part 90.

d. On the basis of disability, in the Rehabilitation Act of 1973 (29 U.S.C. 794), as 

implemented by Department of Justice regulations at 28 CFR part 41 and DoD 

regulations at 32 CFR part 56.

e. On the basis of disability in the Architectural Barriers Act of 1968 (42 U.S.C. 4151 et 

seq.) related to physically handicapped persons’ ready access to, and use of, 

buildings and facilities for which federal funds are used in design, construction, or 

alteration.

Section B. Other Nondiscrimination Requirements. RESERVED - Only applicable if 

provided in award-specific terms and conditions.
100

NP Article II. Environmental National Policy Requirements. 

Section A. Cross-Cutting Environmental Requirements. 

1. You must:

a. Comply with all applicable federal environmental laws and regulations. The laws 

and regulations identified in this section are not intended to be a complete list.

b. Comply with applicable provisions of the Clean Air Act (42 U.S.C. 7401, et seq.) 

and Clean Water Act (33 U.S.C. 1251, et seq.).

c. Comply with applicable provisions of the Lead-Based Paint Poisoning Prevention 

Act (42 U.S.C. 4821-4846), as implemented by the Department of Housing and 

Urban Development at 24 CFR part 35. The requirements concern lead-based 

paint in buildings owned by the Federal Government or housing receiving 

federal assistance.

d. Immediately identify to us, as the federal awarding agency, any potential impact 

that you find NGB CA awards may have on:

(1) The quality of the “human environment”, as defined in 40 CFR 1508.14, 

including wetlands; and provide any help we may need to comply with the 

National Environmental Policy Act (NEPA, at 42 U.S.C. 4321 et seq.), the 

regulations at 40 CFR 1500-1508, and Executive Order 12114, if applicable; 

and assist us to prepare Environmental Impact Statements or other 

environmental documentation. In such cases, you may take no action that 

will have an environmental impact (e.g., physical disturbance of a site such 

as breaking of ground) or limit the choice of reasonable alternatives to the 

proposed action until we provide written notification of federal compliance 

with NEPA or Executive Order 12114.

(2) Flood-prone areas and provide any help we may need to comply with the 

National Flood Insurance Act of 1968, as amended by the Flood Disaster 

Protection Act of 1973 (42 U.S.C. 4001 et seq.), which require flood 

insurance, when available, for federally assisted construction or acquisition 

in flood-prone areas.

(3) A land or water use or natural resource of a coastal zone that is part of a 

federally approved state coastal zone management plan and provide any 

help we may need to comply with the Coastal Zone Management Act of 

1972 (16 U.S.C. 1451, et seq.) including preparation of a Federal agency 

Coastal Consistency Determination.

(4) Coastal barriers along the Atlantic and Gulf coasts and Great Lakes’ shores 

and provide help we may need to comply with the Coastal Barrier 

Resources Act (16 U.S.C. 3501 et seq.), concerning preservation of barrier 

resources.
101

(5) Any existing or proposed component of the National Wild and Scenic Rivers 

system and provide any help we may need to comply with the Wild and 

Scenic Rivers Act of 1968 (16 U.S.C. 1271 et seq.).

(6) Underground sources of drinking water in areas that have an aquifer that is 

the sole or principal drinking water source and in wellhead protection areas 

and provide any help we may need to comply with the Safe Drinking Water 

Act (42 U.S.C. 300f et seq.).

e. You must comply fully with the Endangered Species Act of 1973, as amended 

(ESA, at 16 U.S.C. 1531 et seq.) and implementing regulations of the 

Departments of the Interior (50 CFR parts 10-24) and Commerce (50 CFR 

parts 217-227). You also must provide any help we may need in complying with 

the consultation requirements of ESA section 7 (16 U.S.C. 1536) applicable to 

federal agencies or any regulatory authorization we may need resulting from 

performance under NGB CA awards. This is not in lieu of responsibilities you 

have to comply with provisions of the Act that apply directly to you as a U.S. 

entity, independent of receiving NGB CA awards.

f. You must fully comply with the Marine Mammal Protection Act of 1972, as 

amended (MMPA, at 16 U.S.C. 1361 et seq.) and provide any assistance we 

may need in obtaining any required MMPA permit resulting from performance 

under NGB CA awards.

Section B. Other Environmental Requirements. RESERVED - Only applicable if 

provided in award-specific terms and conditions.

NP Article III. National Policy Requirements Concerning Live Organisms. RESERVED –

Not Applicable.

NP Article IV. Other National Policy Requirements. 

Section A. Cross-Cutting Requirements.

1. Debarment and Suspension. You must comply with requirements regarding 

debarment and suspension in Subpart C of 2 CFR part 180, as adopted by DoD at 2 

CFR part 1125. This includes requirements concerning your principals under NGB CA 

awards, as well as requirements concerning your procurement transactions and 

subawards that are implemented in PROC Articles I through III and SUB Article II.

2. Drug-Free Workplace. You must comply with drug-free workplace requirements in 

Subpart B of 2 CFR part 182, which is the DoD implementation of 41 U.S.C. chapter 

81, “Drug-Free Workplace.”
102

3. Lobbying.

a. You must comply with the restrictions on lobbying in 31 U.S.C. 1352, as 

implemented by DoD at 32 CFR part 28, and submit all disclosures required by that 

statute and regulation.

b. You must comply with the prohibition in 18 U.S.C. 1913 on the use of federal funds, 

absent express Congressional authorization, to pay directly or indirectly for any 

service, advertisement or other written matter, telephone communication, or other 

device intended to influence at any time a Member of Congress or official of any 

government concerning any legislation, law, policy, appropriation, or ratification.

c. If you are a nonprofit organization described in section 501(c)(4) of title 26, United 

States Code (the Internal Revenue Code of 1968), you may not engage in lobbying 

activities as defined in the Lobbying Disclosure Act of 1995 (2 U.S.C., chapter 26).

If we determine that you have engaged in lobbying activities, we will cease all 

payments to you under this and other awards and terminate the awards unilaterally 

for material failure to comply with the award terms and conditions.

4. Officials not to Benefit. You must comply with the requirement that no member of 

Congress shall be admitted to any share or part of NGB CA awards, or to any benefit 

arising from it, in accordance with 41 U.S.C. 6306.

5. Hatch Act. If applicable, you must comply with the provisions of the Hatch Act (5 

U.S.C. 1501-1508) concerning political activities of certain state and local government 

employees, as implemented by the Office of Personnel Management at 5 CFR part 

151, which limits political activity of employees or officers of state or local governments 

whose employment is connected to an activity financed in whole or part with federal

funds.

6. Native American Graves Protection and Repatriation. If you control or possess 

Native American remains and associated funerary objects, you must comply with the 

requirements of 43 CFR part 10, the Department of the Interior implementation of the 

Native American Graves Protection and Repatriation Act of 1990 (25 U.S.C., chapter 

32).

7. Fly America Act. You must comply with the International Air Transportation Fair 

Competitive Practices Act of 1974 (49 U.S.C. 40118), commonly referred to as the “Fly 

America Act,” and implementing regulations at 41 CFR 301-10.131 through 301-

10.143. The law and regulations require that U.S. Government financed international 

air travel of passengers and transportation of personal effects or property must use a 

U.S. Flag air carrier or be performed under a cost-sharing arrangement with a U.S. 

carrier, if such service is available.

8. Use of United States-flag Vessels. You must comply with the following requirements 

of the Department of Transportation at 46 CFR 381.7, in regulations implementing the 

Cargo Preference Act of 1954:
103

a. Pursuant to Public Law 83-664 (46 U.S.C. 55305), at least 50 percent of any 

equipment, materials or commodities procured, contracted for, or otherwise 

obtained with funds under NGB CA awards, and which may be transported by 

ocean vessel, must be transported on privately owned United States flag 

commercial vessels, if available.

b. Within 20 days following the date of loading for shipments originating within the 

United States or within 30 working days following the date of loading for shipments 

originating outside the United States, a legible copy of a rated, “on-board” 

commercial ocean bill-of-lading in English for each shipment of cargo described in 

section 8.a of this section must be furnished to both our award administrator 

(through you in the case of your contractor’s bill-of-lading) and to the Division of 

National Cargo, Office of Market Development, Maritime Administration, 

Washington, DC 20590.

9. Research Misconduct. You must comply with requirements concerning research 

misconduct in Enclosure 4 to DoD Instruction 3210.7, “Research Integrity and 

Misconduct.” The Instruction implements the Federal Governmentwide research 

misconduct policy that the Office of Science and Technology Policy published in the 

Federal Register (65 FR 76260, December 6, 2000, available through the U.S. 

Government Printing Office web site:

http://www.gpo.gov/fdsys/browse/collection.action?collectionCode=FR).

10. Requirements for an Institution of Higher Education Concerning Military 

Recruiters and Reserve Officers Training Corps (ROTC).

a. As a condition for receiving funds available to the DoD (NGB) under NGB CA 

awards, you agree that you are not an institution of higher education (as defined in 

32 CFR part 216) that has a policy or practice that either prohibits, or in effect 

prevents:

(1) The Secretary of a Military Department from maintaining, establishing, or 

operating a unit of the Senior Reserve Officers Training Corps (ROTC)—-in 

accordance with 10 U.S.C. 654 and other applicable federal laws—-at that 

institution (or any sub element of that institution);

(2) Any student at that institution (or any sub element of that institution) from 

enrolling in a unit of the Senior ROTC at another institution of higher 

education;

(3) The Secretary of a Military Department or Secretary of Homeland Security 

from gaining access to campuses, or access to students (who are 17 years of 

age or older) on campuses, for purposes of military recruiting in a manner that 

is at least equal in quality and scope to the access to campuses and to 

students that is provided to any other employer; or

(4) Access by military recruiters for purposes of military recruiting to the names of 

students (who are 17 years of age or older and enrolled at that institution or 
104

any sub element of that institution); their addresses, telephone listings, dates 

and places of birth, levels of education, academic majors, and degrees 

received; and the most recent educational institutions in which they were 

enrolled.

b. If you are determined, using the procedures in 32 CFR part 216, to be such an 

institution of higher education during the period of performance of NGB CA 

awards, we:

(1) Will cease all payments to you of federal funds under NGB CA awards and all 

other DoD grants and cooperative agreements.

(2) May suspend or terminate those awards unilaterally for material failure to 

comply with the award terms and conditions.

11. Historic Preservation. You must identify to us any:

a. Property listed or eligible for listing on the National Register of Historic Places that 

will be affected by NGB CA awards, and provide any help we may need, with 

respect NGB CA awards, to comply with section 106 of the National Historic 

Preservation Act of 1966 (54 U.S.C. 306108), as implemented by the Advisory 

Council on Historic Preservation regulations at 36 CFR part 800 and Executive 

Order 11593, “Identification and Protection of Historic Properties,” [3 CFR, 1971-

1975 Comp., p. 559]. Impacts to historical properties are included in the definition 

of “human environment” that require impact assessment under NEPA (See NP 

Article II, Section A).

b. Potential under NGB CA awards for irreparable loss or destruction of significant 

scientific, prehistorical, historical, or archeological data, and provide any help we 

may need, with respect to NGB CA awards, to comply with the Archaeological and 

Historic Preservation Act of 1974 (54 U.S.C. chapter 3125).

12. Relocation and Real Property Acquisition. You must comply with applicable 

provisions of 49 CFR part 24, which implements the Uniform Relocation Assistance

and Real Property Acquisition Policies Act of 1970 (42 U.S.C. 4601, et seq.) and 

provide for fair and equitable treatment of persons displaced by federally assisted 

programs or persons whose property is acquired as a result of such programs.

13. Confidentiality of Patient Records. You must keep confidential any records that 

you maintain of the identity, diagnosis, prognosis, or treatment of any patient in 

connection with any program or activity relating to substance abuse education, 

prevention, training, treatment, or rehabilitation that is assisted directly or indirectly 

under NGB CA awards, in accordance with 42 U.S.C. 290dd-2.

14. Pro-Children Act. You must comply with applicable restrictions in the Pro-Children 

Act of 1994 (Title 20, Chapter 68, subchapter X, Part B of the U.S. Code) on smoking 

in any indoor facility:
105

a. Constructed, operated, or maintained under NGB CA awards and used for routine 

or regular provision of kindergarten, elementary, or secondary education or library 

services to children under the age of 18.

b. Owned, leased, or contracted for and used under NGB CA awards for the routine 

provision of federally funded health care, day care, or early childhood 

development (Head Start) services to children under the age of 18.

15. Constitution Day. You must comply with Public Law 108-447, Div. J, Title I, section 

111 (36 U.S.C. 106 note), which requires each educational institution receiving 

federal funds in a federal fiscal year to hold an educational program on the United 

States Constitution on September 17th during that year for the students served by the 

educational institution.

16. Trafficking in Persons. You must comply with requirements concerning trafficking 

in persons specified in the award term at 2 CFR 175.15(b), as applicable.

17. Whistleblower Protections. You must comply with 10 U.S.C. 2409, including the:

a. Prohibition on reprisals against employees disclosing certain types of information 

to specified persons or bodies.

b. Requirement to notify your employees in writing, in the predominant native 

language of the workforce, of their rights and protections under that statute.

18. Section 889 of the National Defense Authorization Act (NDAA) for Fiscal Year 

(FY) 2019 (Public Law 115-232).

a. Prohibits the head of an executive agency from obligating or expending loan or 

grant funds to procure or obtain, extend, or renew a contract to procure or obtain, 

or enter into a contract (or extend or renew a contract) to procure or obtain the 

equipment, services, or systems prohibited systems as identified in section 889 

of the NDAA for FY 2019.

b. In accordance with 2 CFR 200.216 and 200.471, all awards that are issued on or 

after August 13, 2020, recipients and subrecipients are prohibited from obligating 

or expending loan or grant funds to:

(1) Procure or obtain;

(2) Extend or renew a contract to procure or obtain; or

(3) Enter into a contract (or extend or renew a contract) to procure or obtain 

equipment, services, or systems that uses covered telecommunications 

equipment or services as a substantial or essential component of any 

system, or as critical technology as part of any system. As described in 

Public Law 115-232, section 889, covered telecommunications equipment is 

telecommunications equipment produced by Huawei Technologies Company 
106

or ZTE Corporation (or any subsidiary or affiliate of such entities).

(a) For the purpose of public safety, security of government facilities, 

physical security surveillance of critical infrastructure, and other national 

security purposes, video surveillance and telecommunications 

equipment produced by Hytera Communications Corporation, Hangzhou 

Hikvision Digital Technology Company, or Dahua Technology Company 

(or any subsidiary or affiliate of such entities).

(b) Telecommunications or video surveillance services provided by such 

entities or using such equipment.

(c) Telecommunications or video surveillance equipment or services 

produced or provided by an entity that the Secretary of Defense, in 

consultation with the Director of the National Intelligence or the Director 

of the Federal Bureau of Investigation, reasonably believes to be an 

entity owned or controlled by, or otherwise connected to, the government 

of a covered foreign country.

c. In implementing the prohibition under Public Law 115-232, section 889, 

subsection (f), section (1), heads of executive agencies administering loan, grant, 

or subsidy programs shall prioritize available funding and technical support to 

assist affected businesses, institutions and organizations as is reasonably 

necessary for those affected entities to transition from covered communications 

equipment and services, to procure replacement equipment and services, and to 

ensure that communications service to users and customers is sustained.

d. See Public Law 115-232, section 889 for additional information.

e. Covered Foreign Country means the People’s Republic of China.

f. Telecommunications Cost means the cost of using communication and telephony 

technologies such as mobile phones, land lines, and internet.

g. Do Not Contract with the Enemy (2 CFR 183) 

Section B. Additional Requirements.

1. Prohibition on Using Funds under Grants and Cooperative Agreements with Entities 

that Require Certain Internal Confidentiality Agreements.

2. You may not require your employees, contractors, or subrecipients seeking to report 

fraud, waste, or abuse to sign or comply with internal confidentiality agreements or 

statements prohibiting or otherwise restricting them from lawfully reporting that 

waste, fraud, or abuse to a designated investigative or law enforcement 

representative of a federal department or agency authorized to receive such 

information.

3. You must notify your employees, contractors, and subrecipients that the prohibitions 
107

and restrictions of any internal confidentiality agreements inconsistent with NGB CA 

award, inclusive of these general terms and conditions are no longer in effect.

4. The prohibition in paragraph 1.a. of this section does not contravene requirements 

applicable to Standard Form 312, Form 4414, or any other form issued by a federal

department or agency governing the nondisclosure of classified information.

5. If the Federal Government determines that you are not in compliance with NGB CA 

awards provisions, it:

a. Will prohibit your use of funds under NGB CA awards, in accordance with 

section 743 of Division E of the Consolidated and Further Continuing Resolution 

Appropriations Act, 2015, (Public Law 113-235) or any successor provision of 

law.

b. May pursue other remedies available for your material failure to comply with 

award terms and conditions.
108

SUBDIVISION D - General Terms and Conditions for Programmatic 

Requirements.

Part 1: Authorities

Section A. General Authority. 

1. Title 32 United States Code (U.S.C.) §§ 106 and 107 authorize NGB to contribute funds 

for the support of the operation and training of the Army National Guard and Air National 

Guard. 

2. It is NGB’s policy to do so in the form of a Cooperative Agreement.

Section B. Other Specific Authorities.

Other specific authorities to the programs will be in each the individual Cooperative 

Agreement.

Part 2: NGB Definitions

Section A. Airport Authority.

A Public Agency controlling a Public Airport. A Public Agency is a State or any agency 

of a State, a municipality or other political subdivision of a State, a tax- supported 

organization, or an Indian tribe or pueblo. Public Airport means an airport which is used 

for or to be used for public purposes, under the control of a public agency, and the 

landing area of which is publicly owned.

Section B. Air National Guard.

The Air National Guard (ANG) means that part of the organized militia of the several 

States and Territories, Puerto Rico, and the District of Columbia, active and inactive, 

that:

a. Is an air force.

b. Is trained, and has its officers appointed, under the sixteenth clause of section 8, 

article 1 of the Constitution.

c. Is organized, armed, and equipped wholly or partly at federal expense.

d. Is federally recognized (32 USC § 101).
109

Section C. Army National Guard.

The Army National Guard (ARNG) means that part of the organized militia of the several 

States and Territories, Puerto Rico, and the District of Columbia, active and inactive, 

that --

a. Is a land force.

b. Is trained, and has its officers appointed, under the sixteenth clause of section 8, 

article I of the Constitution.

c. Is organized, armed, and equipped wholly or partly at federal expense.

d. Is federally recognized (32 U.S.C. § 101).

Section D. Army National Guard and Air National Guard Cooperative Agreement Award. 

Any agreements entered by the Department of Defense, National Guard Bureau, with 

recipients, funded by Department of Defense appropriations for the Army National 

Guard and Air National Guard, minor construction, maintenance, repair, or operation of 

facilities, operations of the Army National Guard and Air National Guard, and for other 

programs authorized and directed by Congress or the Department of Defense to be 

performed by the recipients and the National Guard Bureau.

Section E. Chief, National Guard Bureau.

The appointed head of the National Guard Bureau

Section F. Centralized Personnel Plan.

The centralized personnel plan is the mechanism which the recipient may charge 

indirect rates should they choose to centralize cooperative agreement personnel within 

the recipient military department.

Section G. Federal Fiscal Year.

The federal fiscal year that runs from October 1 to September 30.

Section H. Grant Appeal Authority.

The Chief, National Guard Bureau will establish one or more grant appeal authorities to 

decide formal, administrative appeals. The individual so designated will be a General 

Officer or Senior Executive Service Civilian. The appointment order will be issued by 

the Chief, National Guard Bureau.

Section I. In-Kind Assistance.

The federal procurement of supplies and or services, in lieu of funds, to satisfy National 

Guard Bureau’s obligation of assistance support to the recipient. To be used sparingly 
110

as the exception to the rule with strong justification for each action submitted to the 

Grants Officer for pre-approval prior to submitting the request to the contracting office. 

Section J. In-Kind Contribution.

Property or services (valued at the time of the contribution at fair market value) which 

benefit a federally assisted program or activity contributed by or on behalf of the 

recipient to satisfy (in whole or in part) the recipient’s match share of assistance to the 

Cooperative Agreement Award. 

Section K. Military Equipment.

Military Equipment is federal equipment, authorized and used by the Army and Air 

National Guard to carry out tactical military missions (i.e., combat, or homeland 

defense/security), listed in the ARNG Modified Table of Organization Equipment, or AF 

Designed Operational Capability. Military equipment cannot be issued/transferred to 

the State for the purpose of National Guard Bureau cooperative agreement award

execution.

Section L. National Guard Bureau.

DoD Component and a Joint Activity of the Department of Defense headed by a Chief 

who sits on the Joint Staff and is the advisor on National Guard matters. The National 

Guard Bureau is the channel of communication between the departments concerned 

and the several States, Territories, Puerto Rico, and the District of Columbia, on all 

matters pertaining to the National Guard, the Army National Guard of the United States, 

and the Air National Guard of the United States. 

Section M. Principal Investigator. 

Also known as Project Director and State Program Manager The individual within that 

group identified by the organization as the one with whom National Guard Bureau’s 

Federal CA PM generally should communicate as the primary contact for, technical, and 

related budgetary matters concerning the project.

Section N. Renewal Award

An award made subsequent to an expiring Federal award for which the start date is 

contiguous with, or closely follows, the end of the expiring Federal award. A renewal 

award's start date will begin a distinct period of performance.

Section O. State. 

Any state of the United States, the District of Columbia, the Commonwealth of Puerto 

Rico, the Virgin Islands, Guam..., and any agency or instrumentality thereof exclusive of 

local governments. For Military Construction Cooperative Agreements and other 

Cooperative Agreements awarded to meet the purpose of facilities under 10 USC 

Chapter 1803, FACILITIES FOR RESERVE COMPONENTS, the term “State” means 

any of the States of the United States, the District of Columbia, the Commonwealth of 
111

Puerto Rico, and each territory and possession of the United Ss and includes political 

subdivisions and military units thereof and tax-supported agencies therein.

Section P. The Adjutant General

The head of the State (Commonwealth, or Territory) Military Department, appointed by 

the Governor of the State (Commonwealth, or Territory) or elected, according to the 

respective State's (Commonwealth's, or Territory's) constitution, or statute. The

Adjutant General receives funds and property, accounts for expenditures and property 

acquired through a cooperative agreement award and makes returns and reports 

concerning those expenditures and property, as required by the cooperative agreement 

award.

Section Q. United States Property and Fiscal Officer.

The qualified commissioned officer of the Army National Guard or the Air National 

Guard designated by the Chief, National Guard Bureau, to be the United States 

Property and Fiscal Officer of a State or Territory. He/she receives and accounts for 

funds and property of the United States in the possession of the National Guard for 

which he/she is property and fiscal officer; and make returns and reports concerning 

those funds and that property, as required by the Secretary concerned.

Part 3: NGB General Provisions

Section A. Successors and Assigns.

NGB CA awards may not be assigned by a party without the express written consent of 

the other party. All covenants made under NGB CA awards shall bind and take effect to 

the benefit of any successors and assigns of the parties whether expressly assumed or 

acknowledged by such successors or assigns.

Section B. Entire Agreement.

NGB CA award and these general terms and conditions, which are incorporated in 

whole by reference into all NGB CA awards, form the entire agreement between the 

parties as to scope and subject matter of NGB CA award. All prior discussions and 

understandings concerning the scope and subject matter are superseded and 

incorporated by NGB CA awards.

Section C. Severability.

If any provision of NGB CA award is held judicially invalid, the remainder of the CA 

award shall continue in force and effect to the extent not inconsistent with such holding.
112

Section D. Waiver of Breach.

If a party waives enforcement of any provision of NGB CA award upon any event of 

breach by the other party, the waiver shall not automatically extend to any other or 

future events of breach.

Section E. Notices.

1. Any notice, transmittal, approval, or other official communication made by you the 

recipient, under an NGB CA award shall be in writing and shall be delivered by hand, 

email, facsimile transmission, or by mail to the grants officer.

2. Any notice, transmittal, approval, or other official communication made by us, NGB, 

under an NGB CA award shall be in writing and shall be delivered by hand, email, 

facsimile transmission, or by mail by the grants officer or as delegated by the grant 

officer.

Section F. Liabilities and Indemnity.

Except as stated in section G, nothing in NGB CA awards shall be construed as an 

indemnification by one party or the other for liabilities of a party or third persons for 

property loss or damage, or for death or personal injury arising out of and during 

performance of the activities supported by NGB CA awards. Any liabilities or claims for 

property loss or damage or for death or personal injury by a party or its agents, 

employees, contractors or (assigns) or by third persons, arising out of and during the 

performance of supported activities shall be determined according to applicable law.

Section G. Government Furnished Equipment (GFE).

In addition to the Liability and Indemnity provisions in section F, nothing in NGB CA 

award shall be construed as an indemnification by the United States of the State, its 

employees, agents, or third persons, for liability with respect to any and all claims, 

including, but not limited to: (1) claims for damages; and (2) claims for reimbursement 

arising from property loss, personal injury or accident damage related to the use, care, 

or operation of GFE. The Recipient’s liability for lost or damaged GFE will be in 

accordance with applicable State laws. In the event that State law does not authorize 

indemnification, GFE should not be provided.

Part 4: Legal Authorities

Section A. Legal Authority.

The Recipient represents and warrants that it is under no existing or foreseeable legal 

disability that would prevent or hinder it from fulfilling the terms and conditions of NGB

CA award. The Recipient shall promptly notify NGB of any legal impediment that arises 

during the term of NGB CA award that may prevent or hinder the state’s fulfillment of its 

obligations under NGB CA award.
113

Section B. Opinion of Counsel.

Concurrent with its execution of NGB CA award, the Recipient shall furnish an opinion 

of counsel by the highest legal officer of the State, or his or her designee, that:

a. The Recipient has the requisite authority to enter into NGB CA award.

b. The Recipient can make the warranty set forth in Section A above.

c. The Recipient is empowered to assume the responsibilities and obligations it 

proposes to undertake under NGB CA award.

d. The provisions of NGB CA award intended to secure the interests of NGB are 

enforceable according to their terms.

e. The execution of NGB CA award has been duly authorized by the state.

f. That the individual signing NGB CA award on behalf of the recipient has the 

requisite legal authority to bind and obligate the recipient to the terms and conditions 

of NGB CA award.

Part 5: Responsibilities of Parties

Section A. National Guard Bureau (NGB) Responsibilities.

NGB has overall responsibility for NGB-funded awards, including providing oversight for 

technical, programmatic, financial, and administrative performance.

a. Grants Officer.

Grants officer authority is authorized by a warrant issued by NGB, Head of 

Contracting Activity (HCA) or HCA delegate. The grants officer is responsible for all 

actions on behalf of NGB, including entering, modifying, or terminating awards. In 

addition, the grants officer is responsible for the administrative coordination and 

liaison with the recipient. The grants officer is the only person authorized to approve 

changes to any of the requirements in the award.

b. Grants Officer Representative (GOR).

The GOR is a federal employee delegated in writing by the grants officer who is 

responsible for completing day-to-day administrative actions and technical 

monitoring relative to all cooperative agreement awards. The GOR ensures internal 

controls are in place and effective. The GOR establishes and maintains a separate 

file for each award.
114

c. Federal Cooperative Agreement Program Manager (CA PM).

The CA PM is a federal employee, delegated in writing, by the grants officer to 

administer certain aspects of the award. The CA PM has the technical expertise 

related to program implementation and monitors assigned cooperative agreement’s 

performance to ensure compliance with the terms and conditions of the award. The

CA PM provides technical input, direction, and guidance to assist the recipient in 

meeting the terms and conditions of the cooperative agreement. A recipient 

employee cannot be designated as a CA PM.

d. NGB Office of Primary Responsibility Program Manager (NGB-OPR Program 

Manager).

It is NGB policy that all CA awards shall have an appointed NGB-OPR Program

Manager. They should have knowledge of and are responsible for the programmatic 

and/or technical aspects of the federal assistance award. They provide 

administrative and financial guidance to the grants officer and CA PMs as stated in 

the agreement. Lines of communication between the NGB-OPR Program Manager

and you the recipient will go through the CA PM or grants officer as appropriate. 

Section B. Recipient Responsibilities and Compliance with Federal Requirements.

1. The recipient is responsible for notifying NGB of any significant problems relating to the 

administrative, programmatic, or financial aspects of the award. The recipient should 

direct all correspondence related to programmatic and budgetary issues to the grants 

officer, GOR, and CA PM. Lines of communication between the NGB-OPR Program 

Manager and you the recipient will go through the CA PM or grants officer as 

appropriate.

2. The recipient is responsible for the management of the project or activity supported 

under the award and for adherence to federal regulations, the award provisions, and 

these general terms and conditions. Although the recipient is encouraged to seek the 

advice and opinion of the grants officer, GOR, and/or the CA PM on special 

circumstances that may arise, such advice does not diminish the recipient’s 

responsibility for making prudent and sound administrative judgments under the 

circumstances prevailing at the time the decision was made and should not imply that 

the responsibility for operating decisions has shifted to NGB.

3. In addition to the requirements specified in 2 CFR 200.331, these terms and conditions 

flow down to all sub recipients (subcontracts and sub agreements) and must be 

included in the recipient’s sub award instrument. Depending on the type of entity, all 

sub recipients and subcontractors are subject to the federal regulations specified in 

Part 2 of these terms and conditions.

4. Nothing in this provision alters the recipient’s responsibility for conduct of the project 

and compliance with all applicable laws and regulations.
115

Part 6: Period of Performance of Cooperative Agreement 

Awards (Articles from this part are designated with “POP” in 

the article title)

POP Article I. Period of Performance

Section A. Opening of a new NGB Cooperative Agreement Award

1. With the exceptions in Section C, NGB cooperative agreements will be awarded on 1 

October of each fiscal year.

2. The period of performance will begin on 1 October of the Federal fiscal year in which 

funds the first tranche of funds are made available for obligation.

3. The necessary funds must be available for obligation for the fiscal year for the grants 

officer to award a cooperative agreement. However, if the appropriation has been 

signed into law but the funds have not been transferred to the specific grants officer’s

accounts, a cooperative agreement award may still be awarded with the disclaimer 

“Subject to the Availability of Funds” included in the initial award. 

a. In such circumstances, the cooperative agreement award should reflect zero ($0) 

federal dollars obligated and an approved or estimated budget that is not to be 

exceeded. Unless the NGB-OPR Program Manager has approved a budget, the 

budget should be based on the prior year’s budget less ten percent.

b. The cooperative agreement will be modified once funds are received to reflect the 

actual amount funded and budget amount.

Section B. Duration of the Period of Performance (PoP)

1. With the exceptions in Section C, the length of the period of performance will be 

negotiated between the recipient and the grants officer with the grants officer making 

the final decision.

2. The PoP can be from one to five years.

3. You, the recipient may request that the grants officer extend the period of performance 

for any of the following reasons:

a. For projects, contracts and other allowable activities that do not require additional 

funding and were initiated by you during the period of performance but will not be 

completed by the end of the period of performance.

b. An upward adjustment of funds for in-scope changes has been approved by the 

grants officer IAW NGB issuances for projects, contracts and other allowable 

activities that were initiated by you during the period of performance but will not be 

completed by the end of the period of performance.
116

c. For projects, contracts and other allowable activities that will begin after 30 

September following the end of the first year of the PoP if:

(1) There are unliquidated funds remaining in the cooperative agreement award.

(2) Those remaining are not expired.

d. It is the grants officer’s discretion on whether to extend the period of performance. 

It is within the authority of the grants officer to implement additional controls and 

safeguards when extending the period of performance.

Section C. Period of Performance Exceptions.

1. National Guard Youth ChalleNGe cooperative agreement awards may be opened on a 

date other than 1 October of the Federal fiscal year in which funds are made available 

for obligation. The PoP will close twelve months after it is opened. The PoP may be 

extended IAW with Section B, paragraph 2 of this Article.

2. Army Compatible Use Buffer cooperative agreement awards may be opened on a date 

other than 1 October of the Federal fiscal year in which funds are made available for 

obligation. The period of performance will be determined by NGB for each award. The 

period of performance may be extended IAW with Section B, paragraph 2 of this 

Article.

3. Military Construction Cooperative Agreement awards may be opened on a date other 

than 1 October of the Federal fiscal year in which funds are made available for 

obligation. The period of performance will close upon completion of the project but not 

to extend beyond the period that the funds are available for liquidation. The period of 

performance may be extended IAW with Section B, paragraph 2 of this Article.

4. Other agreement awards that are for specific projects that will not be renewed may be 

opened on a date other than 1 October of the Federal fiscal year in which funds are 

made available for obligation. The PoP will close upon completion of the project but not 

to extend beyond the period that the funds are available for liquidation. The PoP may 

be extended IAW with Section B, paragraph 2 of this Article.

POP Article II. Use of Renewal Awards

1. If the determination is to use one year PoPs for a CA Award, the grants officer has the 

discretion to execute up to four one-year “renewal awards” to an initial award. If a 

renewal award is issued, each renewal period will have its own distinct PoP.

2. If the grants officer elects to execute a renewal award, there will not be a requirement 

for legal review unless there is a change to the terms of the agreement from the initial 

cooperative agreement award.
117

3. Cooperative agreement extension requirements under POP Article I applies to renewal 

awards the same as it does to the initial award.

Part 7: Payments

Payment Method, Timing, and Amounts. 

1. Recipients will submit requests for reimbursement/advancement on the Standard Form 

(SF) 270.

2. To ensure proper fiscal stewardship, the SF 270 will be reviewed by the grants officer, 

GOR and the CA PM for the CA award.

3. Requested reimbursements will be processed by the grants officer and paid within 30 

days after receipt and acceptance.

4. Exclude from any payment request amounts from any of the following sources that are 

available to you for project or program purposes under an NGB CA award: program 

income, including repayments to a revolving fund; rebates; refunds; contract 

settlements; audit recoveries; and interest earned on any of those funds. You must 

disburse those funds for project or program purposes before requesting additional 

funds from us.

5. Reimbursement is the preferred method of NGB, however if state law or a non -federal 

entity’s policies indicates it must have funds on hand, the recipient may request 

advance payment.

6. To request authority for the advance method the Recipient shall annually prepare and 

sign a memorandum and forward it to the grants officer NLT 1 September of each year. 

Recipient will work with the GOR and grants officer on required information per NGB 

Policies. 

Part 8: Authorized Charges

Personnel.

1. Payments for salaries, to include approved overtime and allowable benefits IAW 

recipient personnel policy for the payment of salary and benefits of like recipient 

government positions within the same geographic area are allowable costs.

2. Personnel actions for recipient employees such as pay raises, bonuses, pay freezes or 

pay caps, hiring freezes or employee furloughs will be treated consistently as other like 

positions that do not support work being performed in support of a CA award. 
118

3. When there is no like state government position available, salaries and benefits will be 

equivalent to a comparable grade and series Federal Civil Service position in the 

geographic area. 

4. Raises for federally reimbursed state employees and state-contracted personnel will 

not exceed those of comparable state employees.

5. Costs for merit and incentive awards based on performance, providing the awards are 

part of a program available and consistent with those offered to similar state 

government positions. 

6. Overtime required by Fair Labor Standards Act (FLSA), based on the work schedule 

authorized by the state. When operational requirements or personnel circumstances 

dictate additional staffing in support of the mission, overtime may be authorized as 

specified in the CA award to satisfy minimum staffing requirements. 

7. Overtime may be approved on an exception basis (filling for sick or annual leave, 

emergency, or training, etc.).

8. Costs of training for qualification in accordance with established work center 

requirements, and as authorized in each CA award.

9. Any other charges or activities not otherwise authorized, require prior approval by the 

OPR-PM and grants officer, or as specified in the CA award.

Part 9: Centralized Personnel Plan (CPP)

Section A. CPP

1. The CPP is the mechanism which the recipient may charge indirect rates should they 

choose to centralize CA personnel within the recipient military department. 

2. It is the decision of the grants officer whether to allow reimbursement for a CPP. The 

CPP is a negotiated document. The grants officer has final approval over the plan.

3. The recipient’s personnel in the human resource office, procurement office, or

accounting office are the personnel that are authorized to be a part of CPP. 

4. Supervisor’s time for positions being allocated to the CPP will not be calculated in the 

CPP; however, a supervisor, whose time can be validated and allocated to the 

performance of direct supervision over multiple CA awards over personnel working 

directly on those CA awards or non-supervisory functions in the CA award program, 

may be considered in the CPP calculations. 

5. A formal DHHS negotiated Central Services Cost Allocation Plan (CSCAP) can be 

included in the CPP for consideration by the grants officer as part of the CPP
119

submission by the recipient.

Section B. Responsibilities.

The CPP will be negotiated annually between the recipient and the grants officer. The 

grants officer will have final approval. 

a. It is the grants officer’s responsibility to review and validate costs charged to 

agreements for reimbursement. The CPP will reflect only actual, direct personnel 

costs incurred. The CPP will include a methodology that accurately captures the 

separate cost drivers and metrics for each allowable personnel functional area. The 

two most used NGB methodologies to formulate CPP costs drivers are the time 

study of personnel method and the fee per action method.

b. Requested CPP reimbursements must be for incremental, direct, and personnel 

costs that are compensation for staff positions that would not exist if CA awards did 

not exist. Only non-supervisory compensation costs are allocable except as 

described in (1)(c) above. No other costs (i.e., audit costs, equipment) are 

authorized. Reimbursements must be allocated to specific CA awards. requested 

amounts must be based upon the actual level of effort and the personnel must be 

directly responsible for actions supporting the CA award.

Section C. State Central Services Cost Allocation Plan (CSCAP) 

1. CSCAP is a cost that can be classified as either a direct or indirect cost. Recipient 

treatment of the cost, as reflected in its CSCAP or a recipient’s approved indirect cost 

rate negotiated IAW Appendix E, 2 CFR 200.416, will apply. The CSCAP is prepared 

by the recipient IAW Appendix E, 2 CFR 200.416, and approved by the Department of 

Health and Human Services (HHS). The CSCAP is prepared to identify central service 

costs statewide.

2. When a cost cannot be easily classified as a direct or indirect cost, the recipient’s 

treatment of that cost, as reflected in CSCAP or in its approved indirect cost rate 

proposal, will apply. 

3. The CSCAP is prepared to identify central service costs statewide and must have a 

specific percentage identified and negotiated by HHS for each Department within the 

state. 

a. The percentage allowed to be considered in the CPP calculation is that of the 

percentage negotiated under the CSCAP by HHS specifically for the state military 

department. 

b. The grants officer will work with the recipient to ensure there is no duplication of 

charges between the CSCAP and proposed CPP.
120

Part 10: Program Income

You, the recipient must exclude from any payment request amounts from any of the 

following sources that are available to you for project or program purposes under an 

NGB CA award: program income, including repayments to a revolving fund; rebates; 

refunds; contract settlements; audit recoveries; and interest earned on any of those 

funds. You must disburse those funds for project or program purposes before 

requesting additional funds from us.