This section of the FEDERAL REGISTER

contains regulatory documents having general

applicability and legal effect, most of which

are keyed to and codified in the Code of

Federal Regulations, which is published under

50 titles pursuant to 44 U.S.C. 1510.

The Code of Federal Regulations is sold by

the Superintendent of Documents. Prices of

new books are listed in the first FEDERAL

REGISTER issue of each week.

Rules and Regulations Federal Register

55663 

Vol. 75, No. 177 

Tuesday, September 14, 2010 

OFFICE OF MANAGEMENT AND 

BUDGET 

2 CFR Part 170 

RIN 0348–AB61 

Requirements for Federal Funding 

Accountability and Transparency Act 

Implementation 

AGENCY: Office of Federal Financial 

Management, Office of Management and 

Budget (OMB). 

ACTION: Interim final guidance to 

agencies with opportunity for comment. 

SUMMARY: OMB is issuing interim final 

guidance to agencies to establish 

requirements for Federal financial 

assistance applicants, recipients, and 

subrecipients that are necessary for the 

implementation of the Federal Funding 

Accountability and Transparency Act of 

2006, hereafter referred to as ‘‘the 

Transparency Act’’ or ‘‘the Act’’. This 

interim final guidance provides 

standard wording for an award term that 

each agency must include in grant and 

cooperative agreement awards it makes 

on or after October 1, 2010, to require 

recipients to report information about 

first-tier subawards and executive 

compensation under only those awards. 

This implementation of the requirement 

for reporting of subawards and 

executive compensation under Federal 

assistance awards parallels the 

implementation for subcontracts and 

executive compensation under Federal 

procurement contracts, which is in the 

Federal Acquisition Regulation. 

DATES: The effective date for this 

interim final guidance is September 14, 

2010. Comments on the interim final 

guidance must be received by no later 

than October 14, 2010. 

ADDRESSES: Comments may be sent to 

regulations.gov, a Federal E-Government 

Web site that allows the public to find, 

review, and submit comments on 

documents that agencies have published 

in the Federal Register and that are 

open for comment. Simply type ‘‘FFATA 

subaward reporting’’ (in quotes) in the 

Comment or Submission search box, 

click Go, and follow the instructions for 

submitting comments. Comments 

received by the date specified above 

will be included as part of the official 

record and considered in preparing the 

final guidance. 

Marguerite Pridgen, Office of Federal 

Financial Management, Office of 

Management and Budget, 725 17th 

Street, NW., Washington, DC 20503; 

telephone 202–395–7844; fax 202–395– 

3952; e-mail mpridgen@omb.eop.gov. 

FOR FURTHER INFORMATION CONTACT: 

Marguerite Pridgen, Office of Federal 

Financial Management, Office of 

Management and Budget, telephone 

(202) 395–7844 (direct) or (202) 395– 

3993 (main office) and e-mail: 

mpridgen@omb.eop.gov. 

SUPPLEMENTARY INFORMATION: 

I. Background 

On June 6, 2008 [73 FR 32417], the 

Office of Management and Budget 

(OMB) published proposed guidance to 

Federal agencies with an award term 

needed to implement requirements 

related to subaward reporting under the 

Federal Funding Accountability and 

Transparency Act of 2006 (Pub. L. 109– 

282, as amended by section 6202 of 

Public Law 110–252, hereafter referred 

to as ‘‘the Transparency Act’’ or ‘‘the 

Act’’). The guidance was proposed for 

adoption in a new part 33 within title 

2 of the Code of Federal Regulations 

(CFR). 

We are adopting the interim final 

guidance in 2 CFR part 170, a different 

2 CFR part than part 33 in which we 

originally proposed to adopt it in June 

2008. The reason is that part 33 now is 

within a newly created subchapter in 2 

CFR that is for OMB guidance related to 

pre-award responsibilities (for more 

information on the new 2 CFR 

subchapters, see the notice in today’s 

Federal Register that adopts 2 CFR part 

25). The content of the guidance 

following this preamble is better suited 

to another new subchapter for guidance 

on national policy requirements, a 

subchapter that includes part 170. 

We received comments from 75 

entities in response to the 2008 Federal 

Register notice, including: 29 State 

agencies and two associations of State 

officials; 16 institutions of higher 

education and an association of research 

universities; six nonprofit organizations 

and an association of nonprofits; two 

local governmental organizations and an 

association of local government 

officials; two commercial firms; one 

individual; and 14 Federal agencies. 

Some of the comments concerned 

subaward reporting under the 

Transparency Act but were not directly 

related to the content of the guidance. 

For example, we received comments 

that suggested: 

• Specific data elements that either 

should be included in, or excluded 

from, the information that will be 

required for each subaward. 

• A need for better definitions of 

some data elements or clarification of 

the information desired in some data 

fields. 

• Using the same information 

technology systems for submission of 

data on both: (1) Subawards under 

Federal assistance awards subject to the 

Transparency Act’s requirements; and 

(2) subcontracts that entities receiving 

Federal procurement contracts must 

submit under the Act. 

• Other specific features that it would 

be important to include in those 

information technology systems. 

When we received them in 2008, we 

referred comments that do not directly 

relate to the policy guidance to the 

appropriate Federal agency groups, 

including the groups that were working 

on the design of systems to which 

entities will submit data to fulfill their 

reporting responsibilities under the Act. 

As stated in the 2008 Federal Register 

notice, the data elements and other 

aspects of subaward reporting are 

separate from the policy guidance. The 

General Services Administration has 

recently published the information 

collections with an opportunity for 

public comment that provide the 

specific data elements required for 

Transparency Act reporting of 

subawards and executive compensation 

[75 FR 43165]. The Federal acquisition 

councils have simultaneously published 

for public comment their proposed 

information collection for subcontract 

reporting pursuant to the Transparency 

Act. 

As it was proposed in 2008, the new 

part 33 would have required direct 

recipients of Federal agency awards 

and, with some exceptions, 

subrecipients at all lower tiers (if their 


jdjones on DSK8KYBLC1PROD with RULES
55664 Federal Register / Vol. 75, No. 177 / Tuesday, September 14, 2010 / Rules and Regulations 

subawards were subject to Transparency 

Act reporting requirements) to have 

DUNS numbers and register in the CCR. 

Since the publication of the June 2008 

proposal, OMB proposed a new part 25 

to 2 CFR on February 18, 2010 [75 FR 

7316]. The proposed part 25 superseded 

the DUNS number and CCR elements of 

the June 2008 notice and limited the 

DUNS number requirement to 

applicants, recipients, and first-tier 

subrecipients only. The preamble of the 

February 2010 Federal Register 

document also contained responses to 

the public comments on the DUNS and 

CCR requirements proposed in June 

2008. Part 25 is being finalized in 

another document in this section of 

today’s Federal Register. Therefore, the 

DUNS and CCR requirements will not 

be addressed further in this document. 

The remainder of this document 

addresses the portions of the 2008 

proposal related to reporting of 

subawards, as well as the additional 

reporting on executive compensation 

that is required by the subsequent 

amendment to the Transparency Act. In 

developing the interim final policy 

guidance on subaward reporting, we 

considered: 

• All comments relevant to that 

subject in the 2008 proposal; 

• The experience gained under the 

guidance for, and practical 

implementation of, recipient reporting 

required by section 1512 of the 

American Recovery and Reinvestment 

Act of 2009 (Pub. L. 111–5, hereafter 

referred to as ‘‘the Recovery Act’’), 

which we consider to be the pilot 

program for subaward reporting 

envisioned by paragraph (d)(1) of 

section 2 of the Transparency Act; and 

• New transparency and Open 

Government policies put in effect since 

the publication of the 2008 proposal, 

including the amendment of the 

Transparency Act by section 6202 of 

Public Law 110–252 to require the 

reporting of the names and total 

compensation of a recipient’s or 

subrecipient’s five most highly 

compensated executives. 

Because most aspects of this guidance 

were proposed in 2008, with 

opportunity for comment, and given the 

public benefits to be gained by 

expediting the implementation of 

subaward reporting under the 

Transparency Act, we are publishing 

this guidance as interim final. 

The following section provides 

detailed responses to comments that we 

received on the portions of the guidance 

proposed in 2008 that are relevant to 

subaward reporting. Each response 

describes any revisions that we 

included in the interim final guidance 

as a result of the comment. 

II. Comments, Responses, and Changes 

to the Guidance 

A. Comments on the 2008 Federal 

Register Preamble 

Comment: Two commenters noted 

that the preamble of the 2008 Federal 

Register notice missed one data 

element—an award title descriptive of 

the purpose of the funding action— 

when it listed the data elements that the 

Transparency Act specifies for Federal 

agencies’ awards. 

Response: The commenters are correct 

that the Act specifies the additional data 

element. The inadvertent omission did 

not affect the proposed guidance, 

however. The data elements were listed 

solely as background explanatory 

information in the preamble of the 2008 

Federal Register notice. 

Comment: With respect to that same 

list of data elements in the preamble, 

one commenter asked whether the 

inclusion of the country of the recipient 

and its parent entity was a 

typographical error. The commenter 

suggested that the data element likely 

was meant to be the county, rather than 

the country. 

Response: Although the specifics of 

the data elements do not affect the 

guidance, the data element specified in 

the Transparency Act is the country, 

rather than the county. 

B. General Comments Related to the Act 

and Guidance 

Comment: Thirty nine commenters 

expressed concern that recipients and 

subrecipients must allocate additional 

resources in order to comply with the 

new requirements for subaward 

reporting. They cited the need to change 

business processes and systems to begin 

to collect data that they are not 

collecting now and do it electronically. 

They also noted the continuing need for 

resources to compile and report data 

after that initial transition period. Most 

of the commenters noted the fiscal 

impact of subaward reporting and the 

provision in the Transparency Act that 

provides for recovering the additional 

costs. Some State agencies expressed 

concern that the increased 

administration costs would deplete 

resources available for program 

purposes and some suggested that the 

new requirement is an unfunded 

mandate. Some institutions of higher 

education noted that the limitation in 

OMB Circular A–21 on recovery of 

indirect costs could prevent them from 

recovering those costs from their 

Federal awards. Some State agencies 

suggested that the costs should be 

allocable as direct program costs. A 

number of commenters were concerned 

that the added burdens of reporting 

could discourage some entities, 

especially smaller subrecipient entities, 

from applying for Federal grants. 

Response: This guidance requires 

only prime grant recipients to report to 

the Federal Government on subawards 

and executive compensation. 

Nevertheless, we understand the 

administrative changes and effort that 

are associated with reporting on 

subawards. As section (d)(2)(A) of the 

Transparency Act provides, recipients 

and subrecipients are allowed ‘‘to 

allocate reasonable costs for the 

collection and reporting of subaward 

data as indirect costs.’’ We will assess 

the overall cost impact of the new 

requirements on recipients and 

subrecipients, as well as their ability to 

recover the indirect costs under current 

limitations in statute, policy, program 

regulations, or practice. 

Comment: Nine commenters 

suggested that it was premature to 

propose the policy guidance. Among 

reasons given were that we did not yet 

provide details about all data elements 

that will be required in each report of 

an obligating action, the definitions of 

the data elements, and the reporting 

format and procedures that will be used. 

A few commenters noted that the award 

term in the proposed guidance referred 

to a Web site at which entities would 

submit subaward data but observed that 

the site was not ready to receive data 

and had no further details on what or 

how to report. One commenter asked if 

there was an exception process when 

there are systems issues to be resolved. 

Response: We revised the wording of 

the award term to further clarify that the 

Web site will be the source of the 

detailed information on what to report 

(i.e., the specific data elements and their 

definitions) and how to report (i.e., the 

formats and information technology 

system features). That information will 

be posted at the Web site before nonFederal entities are required to report 

data on subaward obligations. In 

addition, the General Services 

Administration’s Paperwork Reduction 

Act information collection also provides 

the specific data elements required for 

Transparency Act reporting. 

There is an important distinction to 

be made between the policy guidance 

contained in this Federal Register 

notice and the operational details on 

what and how to report. Under the 

current statute, non-Federal entities will 

be required to report subaward data, a 

basic requirement that does not depend 

on the specific data elements and 


jdjones on DSK8KYBLC1PROD with RULES
Federal Register / Vol. 75, No. 177 / Tuesday, September 14, 2010 / Rules and Regulations 55665 

procedural details. The policy guidance 

and the award term it contains are the 

means for having agencies formally 

communicate that basic statutory 

requirement to recipients and 

subrecipients. Neither the guidance nor 

the award term needs to contain the 

operational details about the specific 

data elements to be reported or how to 

submit the data. Both need to be in 

place now so that agencies can use the 

award term to provide timely 

notification to recipients and 

subrecipients about their 

responsibilities. 

Nonetheless, we fully recognize that 

the operational details also are very 

important. To ensure adequate 

opportunity for public comment, we 

have published the data elements and 

other details that affect the public. 

Further, we have made every effort to 

minimize the burden associated with 

Transparency Act reporting, through 

both pre-population of data and use of 

an electronic system that facilitates 

streamlined reporting [75 FR 43165– 

43166]. With respect to the question 

concerning the exception process, the 

Transparency Act does not provide for 

exceptions due to unresolved systems 

issues. 

Comment: Twenty two commenters 

recommended delaying the January 1, 

2009, date on which the Transparency 

Act provided that subaward reporting 

would begin. They stated that the 

implementation timeframe was not 

reasonable, especially since the 

procedures for compiling and 

submitting the data would not be set 

until after completion of a pilot that had 

not yet begun. Seven of the commenters 

also recommended that OMB grant the 

18-month extension to the deadline that 

the Act allowed for subrecipients under 

awards to State, local, and tribal 

governments, if the Director of OMB 

determined that compliance would 

impose an undue burden for those 

subrecipients. 

Response: A subaward reporting pilot 

was conducted in the Fall of 2008 to 

assess the burden of subaward reporting 

on recipients and subrecipients. The 

results of the pilot were mixed and 

showed that there were various 

unresolved policy and procedural issues 

surrounding subaward reporting. In 

2009, the Recovery Act was enacted and 

required reporting of funds awarded to 

prime recipients, subrecipients and 

vendors. The Recovery Act reporting 

effort, which commenced in October 

2009, served as a demonstration of 

subaward reporting on a 

governmentwide scale which is why we 

consider it to be the pilot program for 

subaward reporting envisioned by 

paragraph (d)(1) of section 2 of the 

Transparency Act. Various audits and 

reviews have been conducted on 

Recovery Act implementation. Some of 

the reports from those reviews are 

available on the Recovery.gov Web site 

under the ‘‘Accountability’’ section and 

include information on recipient 

challenges with implementing reporting 

requirements under the Recovery Act. 

In a memorandum dated April 6, 2010 

with the subject line ‘‘Open Government 

Directive—Federal Spending 

Transparency,’’ OMB established an 

October 1, 2010 deadline for Federal 

agencies to initiate subaward reporting 

pursuant to the Transparency Act and 

provide a timeline for additional 

guidance to assist in meeting the goals 

established in the memorandum. 

Comment: Three commenters pointed 

out that the proposed guidance did not 

include a detailed implementation of a 

Transparency Act provision that 

provides an exemption from the 

subaward reporting requirement for an 

entity that demonstrates to the Director 

of OMB that its gross income, from all 

sources, did not exceed $300,000 in the 

previous tax year. The Act provides for 

the exemption until the Director 

determines that the imposition of the 

reporting requirement will not place an 

undue burden on such entities. The 

commenters noted that the guidance did 

not disclose how to request a reporting 

exemption, what proofs would be 

required, and what evaluation factors 

OMB would use in granting exemptions. 

Response: The award term in 

Appendix A to part 170 of the guidance 

properly includes that exception to the 

subaward reporting requirement. 

Section 2(e) of the Transparency Act 

allows the Director, OMB, to exempt 

any entity that demonstrates its gross 

income, from all sources, did not exceed 

$300,000 in the entity’s previous tax 

year, from reporting the first-tier 

subaward information, until the Director 

determines that the imposition of the 

reporting requirement will not cause 

undue burden on the entity. The 

Director has exempted entities that fall 

under this category at this time. 

Comment: Two commenters raised 

questions concerning the applicability 

of the Paperwork Reduction Act (PRA). 

One stated that the Transparency Act 

and guidance did not comply with the 

PRA. The other suggested that OMB 

could not yet provide the PRA clearance 

for the information collection associated 

with subaward reporting, because the 

data elements and format were not 

specified in the guidance proposed on 

2008. 

Response: As stated in the response to 

a previous comment, the nature of the 

guidance is distinct from that of the 

operational details. What requires PRA 

clearance, as correctly noted by the 

second commenter, are the data 

elements and similar details for which 

reporting burdens can be estimated. The 

General Services Administration has 

recently published the information 

collections for public comment that 

provide the specific data elements 

required for Transparency Act reporting 

of subawards and executive 

compensation [75 FR 43165]. It is not 

pertinent to the issuance of the guidance 

in this Federal Register notice on the 

basic statutory requirement to report. 

Comment: With respect to the 

requirement to report each action under 

a subaward that obligates $25,000 or 

more in Federal funding, ten 

commenters recommended raising the 

$25,000 threshold due to the potential 

magnitude of the burdens, especially on 

small entities. The commenters 

suggested setting the threshold at 

$100,000 or more, to be parallel with 

their State’s reporting requirement, the 

simplified acquisition threshold for 

Federal procurement contracts, or the 

threshold in OMB Circular A–133 at 

which an entity must have a single 

audit. One State agency asked if it could 

request a waiver to increase that 

threshold. 

Response: We made no change to the 

threshold in the guidance. The $25,000 

threshold is set by the Transparency Act 

and there is no provision in the statute 

that authorizes a waiver to increase the 

threshold. 

Comment: Four commenters stated 

that the new subaward reporting 

requirement overlapped with at least 

some Federal agencies’ existing 

requirements for reporting on 

subawards. As an example, one 

commenter cited information about 

subawards that applications to agencies 

either contain or could be amended to 

contain. Two non-Federal entities and 

one Federal agency were concerned that 

the existing and new requirements 

could be redundant, thereby 

unnecessarily increasing the burdens of 

subaward reporting. One Federal agency 

stated that it currently obtained 

information about all subawards, and 

not just those above the $25,000 

threshold, and did not want to lose 

insight into the subawards below 

$25,000 due to the Transparency Act 

threshold. 

Response: Relatively few Federal 

agency awarding offices currently obtain 

the details about each subaward 

obligation that they would need to do 

the reporting under the Transparency 

Act. Many agencies receive individual 

applications that identify the applicant’s 


jdjones on DSK8KYBLC1PROD with RULES
55666 Federal Register / Vol. 75, No. 177 / Tuesday, September 14, 2010 / Rules and Regulations 

intent to make a subaward of a specified 

amount if its application is successful. 

However, the actual subaward recipient 

may not be known at that time or, if 

known, the amount that a successful 

applicant obligates may not be the same 

as it originally planned and proposed, 

for various reasons (e.g., the Federal 

award it receives may be for a lesser 

amount than it proposed or it may 

rebudget after receiving the award, as 

pertinent Federal rules allow it to do 

without the Federal agency’s prior 

approval). Given that what the 

application describes is only a plan, it 

cannot serve as a definitive source of 

information for Transparency Act 

purposes. At this time, we are not 

asking for reporting of subaward 

information below the first-tier. 

With respect to the relatively few 

Federal awarding offices that do obtain 

post-award data on actual subaward 

obligations, we are directing those 

agencies to take the necessary steps to 

ensure that their recipients are not 

required, due to the combination of 

agency-specific and Transparency Act 

reporting requirements, to submit the 

same or similar data multiple times 

during a given reporting period. 

Comment: Five commenters asked 

about the consequences of a 

subrecipient’s noncompliance with 

requirements related to the 

Transparency Act. Two commenters 

expressed concern that delivery of 

essential services could be interrupted if 

awards could not be made or payments 

had to be suspended. 

Response: After a subaward is made, 

the range of consequences that may 

result from the subrecipient’s material 

failure to comply with a requirement 

related to the Transparency Act should 

be no different than it is for a material 

failure to comply with other Federal 

requirements. The same remedies are 

available to the recipient and—should 

the matter of a subrecipient entity’s 

noncompliance become an issue for the 

Federal Government—to a Federal 

agency. 

C. Comments Related to the 

Applicability of the Guidance 

Comment: One commenter stated that 

the guidance should not apply to loan 

guarantees because the definition of 

‘‘federal award’’ in the Transparency Act 

does not explicitly mention them. The 

commenter expressed concern that the 

requirement in the guidance for lenders, 

small businesses, and rural businesses 

to obtain DUNS numbers could be an 

added barrier to their participation in 

U.S. Department of Agriculture (USDA) 

rural development and Small Business 

Administration (SBA) programs that 

stimulate financing for small and rural 

businesses. The commenter 

recommended not applying the 

guidance to loan guarantees under those 

programs until a Federal Register notice 

was published, with an opportunity to 

comment, that proposed applying 

Transparency Act requirements to those 

programs specifically. 

Response: Although the 2008 Federal 

Register notice proposed applicability 

of the guidance broadly to all of the 

types of financial assistance subject to 

the Transparency Act, we revised the 

interim final guidance to implement at 

this time only the reporting 

requirements specifically for first-tier 

subawards under grants and cooperative 

agreements in light of these public 

comments and concerns. We are 

deferring to a later date the 

implementation of subaward reporting 

under other financial assistance subject 

to the Act, which includes loans and 

loan guarantees, as well as lower-tier 

subawards. 

We understand the legitimate concern 

that additional administrative 

requirements can have an impact on 

financial assistance applicants and 

recipients under any Federal program. 

However, to publish a notice that lists 

the hundreds of programs individually 

would be unnecessary and impractical. 

Comment: One Federal agency 

suggested we make it clearer that 

financial assistance provided through 

assessed and voluntary contributions is 

subject to the guidance, by explicitly 

listing that type of assistance in the 

proposed definition of ‘‘Federal 

financial assistance subject to the 

Transparency Act.’’ The definition in 

section 33.325 of the proposed guidance 

included them only implicitly, through 

the inclusion of a category of ‘‘other 

financial assistance transactions that 

authorize the non-Federal entities’ 

expenditure of Federal funds.’’ 

Response: We agree and made the 

change to the guidance (in what now is 

section 170.320). 

Comment: A Federal agency 

recommended that the guidance not 

apply to loans, loan guarantees, interest 

subsidies, and insurance that recipients 

provide as subawards to subrecipients. 

The agency stated that the Transparency 

Act did not explicitly identify them as 

subawards and their inclusion would be 

inconsistent with coverage of the 

administrative requirements for grants 

to and agreements with educational and 

other nonprofit organizations that are in 

2 CFR part 215 (OMB Circular A–110). 

Response: We did not revise the 

guidance. The Act requires OMB to 

‘‘ensure that data regarding subawards 

are disclosed in the same manner as 

data regarding other Federal awards.’’ 

The Transparency Act’s definition of 

‘‘federal award’’ includes types of 

financial assistance awards that are not 

subject to the administrative 

requirements in 2 CFR part 215, and 

therefore includes them both at the 

prime tier between Federal agencies and 

recipients and at lower tiers between 

recipients and subrecipients. While only 

subawards under grants and cooperative 

agreements need to be reported at this 

time, subawards under all types of 

Federal financial assistance subject to 

the Transparency Act will need to be 

reported at a later date. 

Comment: One Federal agency 

expressed concern that it would be 

difficult to provide an actual dollar 

amount associated with a transfer of 

title to Federally owned property. 

Response: We revised the definition 

of ‘‘Federal financial assistance subject 

to the Transparency Act’’ in that section 

(which now is section 170.320) to 

clarify that the guidance does not apply 

to transfers of title to Federally owned 

property. 

Comment: One Federal agency 

suggested amending the proposed 

guidance to explicitly exclude 

Cooperative Research and Development 

Agreements (CRDAs) under 15 U.S.C. 

3710a from coverage under the 

Transparency Act. CRDAs are 

instruments authorized for use between 

Federal laboratories and non-Federal 

entities for technology transfer 

purposes. The commenter noted that the 

statute permits a Federal laboratory to 

receive funds from a non-Federal entity 

under a CRDA and expressed concern 

that a funds transfer might be perceived 

as a subaward to the Federal laboratory. 

Response: We agree and made a 

change to the definition of ‘‘Federal 

financial assistance subject to the 

Transparency Act’’ in that section 

(which now is section 170.320) of the 

guidance. The definition of ‘‘cooperative 

research and development agreement’’ 

in 15 U.S.C. 3710a excludes transactions 

under which Federal funds are provided 

to non-Federal entities. It also 

distinguishes CRDAs, which are not 

Federal financial assistance awards, 

from cooperative agreements under the 

Federal Grant and Cooperative 

Agreement Act in 31 U.S.C., chapter 63. 

Comment: One commenter noted that 

the proposed guidance did not apply to 

a Federal agency that receives an award 

from another agency and asked whether 

it would apply to an award that a 

Federal agency receives from a nonFederal entity. 

Response: Yes, the guidance applies. 

The non-Federal entity would have to 

report the subaward. At this time, the 


jdjones on DSK8KYBLC1PROD with RULES
Federal Register / Vol. 75, No. 177 / Tuesday, September 14, 2010 / Rules and Regulations 55667 

non-Federal entity would not have to 

report lower-tier subawards. To clarify 

this, we revised the definition of ‘‘entity’’ 

in the award term that now is in 

Appendix A to part 170. 

Comment: One commenter stated that 

it acts as a fund manager overseeing 

accounts for Federal agencies into 

which voluntary payments, courtordered settlements, fines, and other 

sources of funds are deposited. It noted 

that the Federal agency specifies the 

entities to whom funds from those 

accounts are obligated. The commenter 

asked if it is the recipient in that case 

and the other entities are the 

subrecipients, or if the entities to whom 

it awards the funds are the prime 

recipients because the Federal agency 

makes the funding decisions. 

Response: If the funds cited in the 

comment are available for obligation or 

reobligation for Federal program 

purposes, this situation is somewhat 

similar to that of a grant under which 

the recipient is authorized to: (1) Make 

loans for program purposes to 

subrecipients; (2) merge the funds 

received from those subrecipients’ loan 

payments back into the corpus of grant 

funding; and (3) use those repaid funds 

to make new loans. In both that case and 

the case raised by the commenter, the 

non-Federal entity that manages Federal 

agency funds that are available for 

program purposes is the recipient. The 

entities that receive the funds that the 

recipient obligates or reobligates are 

subrecipients. 

Comment: One commenter suggested 

not applying the reporting requirement 

below the first-tier of subawards under 

mandatory programs such as block and 

formula grants and other types of 

assistance to State, local, and tribal 

governments. 

Response: The Transparency Act does 

not authorize a limitation on the 

reporting requirement to the first-tier of 

subawards. At this time, however, we 

are deferring to a later date the 

implementation of the reporting 

requirement below the first-tier. 

Comment: Six commenters asked 

whether the requirements in the 

guidance applied to prior program 

announcements, awards, and 

subawards. One of the commenters 

pointed out that an applicant who 

already had applied in response to a 

previously issued announcement might 

have decided not to apply if it had been 

informed about the Transparency Act 

requirements prior to doing so. Others 

noted they would need to amend 

previously issued awards if the 

requirements applied to them. 

Response: New Federal, non-Recovery 

Act funded grant awards and 

cooperative agreements with an award 

date on or after October 1, 2010, and 

resulting first-tier subawards, are subject 

to the reporting requirements in this 

guidance. New Federal grants and 

cooperative agreements are grants and 

cooperative agreements with a new 

Federal Award Identification Number 

(FAIN) as of October 1, 2010. They do 

not include obligating actions on or after 

October 1, 2010, that provide additional 

funding under continuing grants and 

cooperative agreements awarded in 

prior fiscal years. 

D. Other Comments 

Comment: Two commenters raised 

questions about the dates in the 

proposed paragraph 33.200(a)(2). One 

commenter asked what was meant by 

the effective date of the part cited in 

paragraph (a)(2)(i). The other 

commenter recommended changing the 

date in paragraph (a)(2)(ii). That 

paragraph required a Federal agency to 

incorporate Transparency Act 

requirements into a program 

announcement or other application 

instructions if awards would be made 

after October 1, 2008, in response to 

applications using those instructions. 

The commenter recommended changing 

the date to December 31, 2008. 

Response: The guidance in 2 CFR part 

170 is effective today, with its 

publication in the Federal Register. We 

revised the date in paragraph 

170.200(a)(2)(ii) to October 1, 2010. 

Comment: Three commenters noted 

that some entities may want to take 

advantage of the flexibility that the 

award term in the proposed guidance 

gave a recipient to either: (1) Pass the 

responsibility for reporting on lower-tier 

subawards to the subrecipients who 

made those subawards; or (2) do that 

reporting itself, which would require 

the recipient to collect the information 

from lower-tier subrecipients. One, a 

State agency, stated that it maintains a 

complete data base that should be 

sufficient to meet the Transparency Act 

requirements. 

Response: We recognize the burdens 

associated with subaward reporting and 

understand that programs and 

organizations differ. However, prime 

recipients will not have the option to 

delegate reporting of subgrant 

information to their subrecipients. We 

believe that this may help reduce 

reporting burden on subaward 

recipients. 

Comment: Six commenters asked for 

clarification on the meaning of the 

phrases ‘‘date of obligation’’ and 

‘‘obligating action’’ used in the award 

term in the proposed section 33.220 

with respect to subawards. Two 

commenters asked how the date of 

obligation would be defined for a 

subaward that allowed reimbursement 

of pre-award costs a subrecipient 

incurred on or after a ‘‘start date’’ that 

was prior to the date on which the 

subaward was signed. 

Response: With respect to a subaward, 

an obligating action is a transaction that 

makes available to the subrecipient a 

known amount of funding for program 

purposes. Examples include a new 

subaward, an incremental funding 

amendment that increases the total 

amount of a subaward, or a quarterly 

allotment under a formula grant 

program. 

We made no change to the guidance, 

since ‘‘obligations’’ is a well established 

term in OMB’s guidance on 

administrative requirements for grants 

and agreements (2 CFR part 215 and the 

common rule that Federal agencies 

adopted to implement OMB Circular A– 

102). Under most Federal grants and 

cooperative agreements, recipients 

regularly report amounts of ‘‘unobligated 

balances’’ to Federal agencies on the 

standard financial reporting forms. 

The date of obligation for a subaward 

is the date on which the recipient 

authorizes the subrecipient to incur 

costs against the known amount it 

obligates, and does so in a way that 

legally obliges the recipient to provide 

funds to cover costs that are incurred in 

accordance with the subaward’s terms 

and conditions. That date usually is 

associated with the signature of a formal 

document, either the initial subaward or 

an amendment to it. That is distinct 

from the ‘‘start date’’ cited in the 

example of pre-award costs, since we 

assume that the subrecipient incurs 

those costs at its own risk, in 

anticipation of the subaward, and that 

the recipient has no legal obligation— 

until it signs the subaward—to provide 

award funds to cover those costs. 

Comment: Eight commenters 

questioned whether the guidance 

required reporting of obligations or 

disbursements as the award amounts. 

One commenter recommended that 

recipients and subrecipients report 

‘‘expenditures,’’ the term used in the 

Transparency Act. Four State agencies 

asked how ‘‘obligations’’ would be 

determined in some programs that 

adjust the amount a subrecipient 

receives at some time after the initial 

obligation. One of the agencies cited the 

example of the school lunch program, 

under which the amount obligated is 

not known until after the subrecipient 

expends the funds. 

Response: The guidance requires 

reporting of each obligation, rather than 

each disbursement against the amount 


jdjones on DSK8KYBLC1PROD with RULES
55668 Federal Register / Vol. 75, No. 177 / Tuesday, September 14, 2010 / Rules and Regulations 

obligated. If a recipient obligates a 

specific known amount for a subaward, 

even if it may be adjusted later, it must 

report the obligation when it is made. 

For a program like the school lunch 

program, however, where the initial 

subaward provides the subrecipient 

with an open-ended authorization of 

unspecified amount, the obligation date 

corresponds to the date on which the 

amount of the obligation is specified. 

Reporting is required by the end of the 

month following the month in which 

the subaward obligation was made. 

Comment: One commenter 

recommended revising the requirement 

to report each obligating action within 

30 days of the date of obligation. The 

commenter suggested allowing reporting 

quarterly, semiannually, or annually. 

Response: We changed the guidance 

and award term to require obligations to 

be reported no later than the end of the 

month following the month of the 

obligation. For example, if a subaward 

is made on October 2, 2010, the 

subaward information must be reported 

by no later than November 30, 2010. 

Comment: Ten commenters requested 

additional clarification about the 

difference between a subaward, which 

must be reported under the 

Transparency Act, and procurement 

under an award, which is not subject to 

the reporting requirement. 

Response: It is worth noting that 

recipients for many years have had to 

judge whether a transaction under their 

Federal award was a subaward or a 

procurement action. That is because a 

recipient must include different 

requirements in a subaward than it does 

in a procurement under an award, in 

accordance with the administrative 

requirements in 2 CFR part 215 (OMB 

Circular A 110) or the common rule 

implementing OMB Circular A 102. 

Also, when the transaction provides 

funds to a for-profit entity, the recipient 

must properly take into account 

whether the transaction would be more 

characteristic of a vendor relationship 

than a subrecipient under ___.210 of 

OMB Circular A–133. The judgments a 

recipient must make to decide whether 

a lower tier agreement is a subaward or 

procurement for Transparency Act 

reporting purposes are the same as the 

judgments it makes to establish which 

terms and conditions to include in the 

agreement. Prime recipients should refer 

to awarding agency supplemental 

guidance, if any, in making such a 

determination. 

Two examples may help clarify the 

distinction, which is based on the 

purpose of the transaction between the 

recipient or subrecipient and the entity 

at the next lower tier. If the purpose of 

the lower-tier transaction is the same as 

the purpose of the substantive program 

supported by the Federal award at the 

prime tier, so that the recipient through 

that lower tier transaction is in effect 

handing a portion of the substantive 

program over to the lower-tier entity for 

performance, the lower-tier transaction 

is a subaward. The two examples 

follow: 

• Example 1: Provision of health 

services. A Federal program provides 

funding to State agencies to deliver a 

variety of services for older citizens. If 

the State provides funds to a third party 

to carry out a type of service (e.g., 

mental health services) that is 

authorized under the program and the 

State otherwise might deliver itself, the 

agreement is a subaward because the 

third party is carrying out substantive 

programmatic activity that is the 

purpose of the Federal award. If a 

recipient or subrecipient obtains the 

services of a third party to help in 

designing public service 

announcements or developing 

educational materials about the 

program—goods or services that the 

State or subrecipient needs to carry out 

the program that is the purpose of the 

award—that would be a procurement 

under the award or subaward. 

• Example 2: Research. An agency 

makes an award to a university to 

investigate basic physics to understand 

why certain materials have the 

properties they do. To do some of the 

experiments, the university researchers 

need an instrument that does not yet 

exist. The university provides funding 

under the Federal award to a small firm 

to carry out a research and development 

project and develop an instrument. The 

award to the firm has the purpose of 

instrument development, and does not 

have the same purpose as the Federal 

award. The award to the firm is a 

procurement action. If the university 

instead made an award to the firm to 

perform some of the basic research on 

physics of materials that is the 

substantive program purpose of the 

Federal award, and the recipient 

determines it does not have a vendor 

relationship with the firm under this 

award as described in Sec. __.210 of the 

attachment to OMB Circular A–133, the 

award to the firm would be a subaward. 

Comment: One commenter from a 

State agency said that it is unclear 

whether Medicaid is considered Federal 

financial assistance for the purposes of 

the subaward reporting requirement. 

Response: There are no program 

exemptions under this guidance even 

though there are other types of 

exemptions which are described in the 

guidance. If a state makes a subaward 

under a grant or cooperative agreement 

to an entity other than an individual 

who is a natural person, the subaward 

is $25,000 or more, and no exemptions 

apply, the state would need to report the 

subaward. 

Comment: Three commenters raised 

issues with wording in the award term 

in the proposed section 33.220 that 

related to the $25,000 reporting 

threshold for subawards. Two 

commenters asked for clarification on 

the meaning of ‘‘life of the subaward,’’ as 

that phrase was used, both in the award 

term and the associated guidance to 

Federal agencies on use of the award 

term. Another commenter suggested that 

readers might perceive ‘‘$25,000 over 

the life of the subaward’’ to be 

inconsistent with ‘‘each action that 

obligates $25,000 or more in Federal 

funding.’’ One of the commenters also 

suggested consistent wording to replace 

‘‘a total value of $25,000’’ in one 

paragraph and ‘‘in that range’’ in another 

paragraph. 

Response: With respect to the 

comment concerning the apparent 

inconsistency between ‘‘a total value of 

25,000’’ and ‘‘each action that obligates 

$25,000 or more in Federal funding,’’ it 

should be noted that the two phrases 

refer to related but different 

requirements addressing lower-tier 

subaward reporting. We have revised 

the interim final guidance to show that 

only recipient reporting of first-tier 

subawards will be required at this time, 

and therefore, the comment is no longer 

relevant. We have replaced the phrase 

‘‘life of the subaward’’ with alternative 

wording that more clearly specifies 

when a recipient must include the 

Transparency Act reporting requirement 

in a subaward it makes to a 

subrecipient. For new Federal grants or 

cooperative agreements as of October 1, 

2010, if the initial award is $25,000 or 

more, reporting of subaward 

information is required. If the initial 

award is below $25,000 but subsequent 

award modifications result in a total 

award of $25,000 or more, the award is 

subject to the reporting requirements, as 

of the date the award exceeds $25,000. 

If the initial award is $25,000 or more, 

but funding is subsequently deobligated such that the total award 

amount falls below $25,000, the award 

continues to be subject to the reporting 

requirements of the Transparency Act. 

Comment: One commenter asked for 

clarification concerning reporting 

requirements for incrementally funded 

subawards. The commenter gave as an 

example a subaward that a recipient 

expected to exceed $25,000 over the 

duration of the subaward, but for which 


jdjones on DSK8KYBLC1PROD with RULES
Federal Register / Vol. 75, No. 177 / Tuesday, September 14, 2010 / Rules and Regulations 55669 

the initial obligation was less than 

$25,000. 

Response: Each action that obligates 

$25,000 or more in Federal funds must 

be reported. 

Comment: Three commenters asked 

whether a recipient or subrecipient 

would be required to report a downward 

adjustment in the amount of a subaward 

it had made previously. 

Response: We made no change to the 

guidance. The award term that now is 

in section Appendix A to part 170 of the 

guidance refers recipients and 

subrecipients to the web site at which 

data submission instructions will be 

posted. Those instructions will include 

the specific data elements and their 

definitions that, as discussed in Section 

I of this Federal Register notice, have 

been established through a separate 

process under the Paperwork Reduction 

Act [75 FR 43165]. The instructions will 

address whether reporting of reductions 

in subaward amounts, sometimes called 

‘‘deobligations,’’ are a subcategory of 

obligations to be reported. 

Comment: One commenter asked 

about the requirement to submit 

changed information other than 

subaward amounts, such as a change in 

subrecipient information. 

Response: If the information that was 

reported was correct at the time it was 

reported and changed at a later date, 

there would be no need to subsequently 

revise the information in previously 

submitted reports. The updated 

information would be included in 

reports of subsequent obligations under 

the same subaward, however. 

That is distinct from a case in which 

a recipient later discovers that 

information it reported was erroneous at 

the time it was reported. Questions 

concerning error corrections in that case 

are being considered by the interagency 

group developing the data elements and 

information technology systems for 

subaward reporting. As discussed in the 

response to the previous comment, the 

process for resolving those issues will 

include an opportunity for public input. 

Comment: Four commenters asked 

how one would report subawards to 

recipients with multiple Federal 

funding sources. One commenter asked 

if the amount of funding from each 

program listed in the Catalog of Federal 

Domestic Assistance (CFDA) would 

need to be reported. 

Response: Each action that obligates 

$25,000 or more in Federal funding 

would need to be separately reported. 

For new Federal grants or cooperative 

agreements as of October 1, 2010, if the 

initial award is $25,000 or more, 

reporting of subaward information is 

required. If the initial award is below 

$25,000 but subsequent award 

modifications result in a total award of 

$25,000 or more, the award is subject to 

the reporting requirements, as of the 

date the award exceeds $25,000. If the 

initial award exceeds $25,000 but 

funding is subsequently de-obligated 

such that the total award amount falls 

below $25,000, the award continues to 

be subject to the reporting requirements 

of the Transparency Act. If a single 

action obligates funding from multiple 

programs, the data submitted for that 

action would include the CFDA number 

for the program that is the predominant 

source of the Federal funding. If a 

program’s funding is obligated by a 

separate amendment to the same 

subaward agreement that provides other 

programs’ funding, however, then the 

data reported for each amendment to the 

agreement would include the CFDA 

number of the program that provided 

the funding for that amendment. 

Comment: One commenter asked 

whether, in light of the new reporting 

requirements, a subrecipient would be 

subject to Federal audit requirements if 

it received $500,000 or more either from 

a single program or a combination of 

programs. 

Response: The new reporting 

requirements under the Transparency 

Act do not change the audit 

requirements in OMB Circular A–133, 

section ll.200, that apply to a nonFederal entity that expends $500,000 or 

more in ‘‘federal awards’’ (which the 

Circular defines to include Federal 

financial assistance received indirectly 

through pass-through entities). 

III. Next Steps 

Federal agencies that award Federal 

financial assistance subject to the 

Transparency Act will implement the 

interim final guidance in 2 CFR part 170 

through their regulations, internal 

policy guidance to awarding offices, 

program announcements and 

application instructions, and the award 

term that now is in section Appendix A 

to part 170. The General Services 

Administration has recently published 

in the Federal Register with an 

opportunity for public comment the 

information collections that provide the 

specific data elements required for 

Transparency Act reporting of 

subawards and executive compensation 

[75 FR 43165]. The information 

collections will be modified as 

appropriate in response to public 

comments and published with any other 

operational guidelines before recipients 

begin reporting data on subawards. 

List of Subjects in 2 CFR Part 170 

Business and industry, Colleges and 

universities, Cooperative agreements, 

Farmers, Federal aid programs, Grant 

programs, Grants administration, 

Hospitals, Indians, Insurance, 

International organizations, Loan 

programs, Nonprofit organizations, 

Reporting and recordkeeping 

requirements, State and local 

governments, Subsidies. 

Danny Werfel, 

Controller. 

Authority and Issuance 

■ For the reasons set forth above, the 

Office of Management and Budget 

amends 2 CFR chapter I by adding part 

170 to read as follows: 

PART 170—REPORTING SUBAWARD 

AND EXECUTIVE COMPENSATION 

INFORMATION 

Sec. 

Subpart A—General 

170.100 Purposes of this part. 

170.105 Types of awards to which this part 

applies. 

170.110 Types of entities to which this part 

applies. 

170.115 Deviations. 

Subpart B—Policy 

170.200 Requirements for program 

announcements, regulations, and 

application instructions. 

170.220 Award term 

Subpart C—Definitions 

170.300 Agency. 

170.305 Award. 

170.310 Entity. 

170.315 Executive 

170.320 Federal financial assistance 

subject to the Transparency Act. 

170.325 Subaward. 

170.330 Total compensation. 

Appendix A to Part 170—Award Term 

Authority: Pub. L. 109–282; 31 U.S.C. 

6102. 

Subpart A—General 

§ 170.100 Purposes of this part. 

This part provides guidance to 

agencies to establish requirements for 

recipients’ reporting of information on 

subawards and executive total 

compensation, as required by the 

Federal Funding Accountability and 

Transparency Act of 2006 (Pub. L. 109– 

282), as amended by section 6202 of 

Public Law 110–252, hereafter referred 

to as ‘‘the Transparency Act’’. 

§ 170.105 Types of awards to which this 

part applies. 

This part applies to an agency’s 

grants, cooperative agreements, loans, 


jdjones on DSK8KYBLC1PROD with RULES
55670 Federal Register / Vol. 75, No. 177 / Tuesday, September 14, 2010 / Rules and Regulations 

and other forms of Federal financial 

assistance subject to the Transparency 

Act, as defined in § 170.320. 

§ 170.110 Types of entities to which this 

part applies. 

(a) General. Through an agency’s 

implementation of the guidance in this 

part, this part applies to all entities, 

other than those excepted in paragraph 

(b) of this section, that— 

(1) Apply for or receive agency 

awards; or 

(2) Receive subawards under those 

awards. 

(b) Exceptions. (1) None of the 

requirements in this part apply to an 

individual who applies for or receives 

an award as a natural person (i.e., 

unrelated to any business or non-profit 

organization he or she may own or 

operate in his or her name). 

(2) None of the requirements 

regarding reporting names and total 

compensation of an entity’s five most 

highly compensated executives apply 

unless in the entity’s preceding fiscal 

year, it received— 

(i) 80 percent or more of its annual 

gross revenue in Federal procurement 

contracts (and subcontracts) and Federal 

financial assistance awards subject to 

the Transparency Act, as defined at 

§ 170.320 (and subawards); and 

(ii) $25,000,000 or more in annual 

gross revenue from Federal procurement 

contracts (and subcontracts) and Federal 

financial assistance awards subject to 

the Transparency Act, as defined at 

§ 170.320; and 

(3) The public does not have access to 

information about the compensation of 

the senior executives through periodic 

reports filed under section 13(a) or 15(d) 

of the Securities Exchange Act of 1934 

(15 U.S.C. 78m(a), 78o(d)) or section 

6104 of the Internal Revenue Code of 

1986. 

§ 170.115 Deviations. 

Deviations from this part require the 

prior approval of the Office of 

Management and Budget (OMB). 

Subpart B—Policy 

§ 170.200 Requirements for program 

announcements, regulations, and 

application instructions. 

(a) Each agency that makes awards of 

Federal financial assistance subject to 

the Transparency Act must include the 

requirements described in paragraph (b) 

of this section in each program 

announcement, regulation, or other 

issuance containing instructions for 

applicants: 

(1) Under which awards may be made 

that are subject to Transparency Act 

reporting requirements; and 

(2) That either: 

(i) Is issued on or after the effective 

date of this part; or 

(ii) Has application or plan due dates 

after October 1, 2010. 

(b) The program announcement, 

regulation, or other issuance must 

require each entity that applies and does 

not have an exception under 

§ 170.110(b) to ensure they have the 

necessary processes and systems in 

place to comply with the reporting 

requirements should they receive 

funding. 

(c) Federal agencies that obtain postaward data on subaward obligations 

outside of this policy should take the 

necessary steps to ensure that their 

recipients are not required, due to the 

combination of agency-specific and 

Transparency Act reporting 

requirements, to submit the same or 

similar data multiple times during a 

given reporting period. 

§ 170.220 Award term. 

(a) To accomplish the purposes 

described in § 170.100, an agency must 

include the award term in Appendix A 

to this part in each award to a nonFederal entity under which the total 

funding will include $25,000 or more in 

Federal funding at any time during the 

project or program period. 

(b) An agency— 

(1) Consistent with paragraph (a) of 

this section, is not required to include 

the award term in Appendix A to this 

part if it determines that there is no 

possibility that the total amount of 

Federal funding under the award will 

equal or exceed $25,000. However, the 

agency must subsequently amend the 

award to add the award term if changes 

in circumstances increase the total 

Federal funding under the award to 

$25,000 or more during the project or 

program period. 

Subpart C—Definitions 

§ 170.300 Agency. 

Agency means a Federal agency as 

defined at 5 U.S.C. 551(1) and further 

clarified by 5 U.S.C. 552(f). 

§ 170.305 Award. 

Award, for the purposes of this part, 

effective October 1, 2010, means a grant 

or cooperative agreement. On future 

dates to be specified by OMB in policy 

memoranda available at the OMB Web 

site, award also will include other types 

of awards of Federal financial assistance 

subject to the Transparency Act, as 

defined in § 170.320. 

§ 170.310 Entity. 

Entity has the meaning given in 2 CFR 

part 25. 

§ 170.315 Executive. 

Executive means officers, managing 

partners, or any other employees in 

management positions. 

§ 170.320 Federal financial assistance 

subject to the Transparency Act. 

Federal financial assistance subject to 

the Transparency Act means assistance 

that non-Federal entities described in 

§ 170.105 receive or administer in the 

form of— 

(a) Grants; 

(b) Cooperative agreements (which 

does not include cooperative research 

and development agreements pursuant 

to the Federal Technology Transfer Act 

of 1986, as amended (15 U.S.C. 3710a)); 

(c) Loans; 

(d) Loan guarantees; 

(e) Subsidies; 

(f) Insurance; 

(g) Food commodities; 

(h) Direct appropriations; 

(i) Assessed and voluntary 

contributions; and 

(j) Other financial assistance 

transactions that authorize the nonFederal entities’ expenditure of Federal 

funds. 

(b) Does not include— 

(1) Technical assistance, which 

provides services in lieu of money; 

(2) A transfer of title to Federally 

owned property provided in lieu of 

money, even if the award is called a 

grant; 

(3) Any classified award; or 

(4) Any award funded in whole or in 

part with Recovery funds, as defined in 

section 1512 of the American Recovery 

and Reinvestment Act of 2009 (Pub. L. 

111–5). 

§ 170.325 Subaward. 

Subaward has the meaning given in 

paragraph e.3 of the award term in 

Appendix A to this part. 

170.330 Total compensation. 

Total Compensation has the meaning 

given in paragraph e.5 of the award term 

in Appendix A to this part. 

Appendix A to Part 170—Award Term 

I. Reporting Subawards and Executive 

Compensation. 

a. Reporting of first-tier subawards. 

1. Applicability. Unless you are exempt as 

provided in paragraph d. of this award term, 

you must report each action that obligates 

$25,000 or more in Federal funds that does 

not include Recovery funds (as defined in 

section 1512(a)(2) of the American Recovery 

and Reinvestment Act of 2009, Pub. L. 

111–5) for a subaward to an entity (see 

definitions in paragraph e. of this award 

term). 

2. Where and when to report. 

i. You must report each obligating action 

described in paragraph a.1. of this award 

term to http://www.fsrs.gov. 


jdjones on DSK8KYBLC1PROD with RULES
Federal Register / Vol. 75, No. 177 / Tuesday, September 14, 2010 / Rules and Regulations 55671 

ii. For subaward information, report no 

later than the end of the month following the 

month in which the obligation was made. 

(For example, if the obligation was made on 

November 7, 2010, the obligation must be 

reported by no later than December 31, 2010.) 

3. What to report. You must report the 

information about each obligating action that 

the submission instructions posted at 

http://www.fsrs.gov specify. 

b. Reporting Total Compensation of 

Recipient Executives. 

1. Applicability and what to report. You 

must report total compensation for each of 

your five most highly compensated 

executives for the preceding completed fiscal 

year, if— 

i. the total Federal funding authorized to 

date under this award is $25,000 or more; 

ii. in the preceding fiscal year, you 

received— 

(A) 80 percent or more of your annual gross 

revenues from Federal procurement contracts 

(and subcontracts) and Federal financial 

assistance subject to the Transparency Act, as 

defined at 2 CFR 170.320 (and subawards); 

and 

(B) $25,000,000 or more in annual gross 

revenues from Federal procurement contracts 

(and subcontracts) and Federal financial 

assistance subject to the Transparency Act, as 

defined at 2 CFR 170.320 (and subawards); 

and 

iii. The public does not have access to 

information about the compensation of the 

executives through periodic reports filed 

under section 13(a) or 15(d) of the Securities 

Exchange Act of 1934 (15 U.S.C. 78m(a), 

78o(d)) or section 6104 of the Internal 

Revenue Code of 1986. (To determine if the 

public has access to the compensation 

information, see the U.S. Security and 

Exchange Commission total compensation 

filings at http://www.sec.gov/answers/

execomp.htm.) 

2. Where and when to report. You must 

report executive total compensation 

described in paragraph b.1. of this award 

term: 

i. As part of your registration profile at 

http://www.ccr.gov. 

ii. By the end of the month following the 

month in which this award is made, and 

annually thereafter. 

c. Reporting of Total Compensation of 

Subrecipient Executives. 

1. Applicability and what to report. Unless 

you are exempt as provided in paragraph d. 

of this award term, for each first-tier 

subrecipient under this award, you shall 

report the names and total compensation of 

each of the subrecipient’s five most highly 

compensated executives for the 

subrecipient’s preceding completed fiscal 

year, if— 

i. in the subrecipient’s preceding fiscal 

year, the subrecipient received— 

(A) 80 percent or more of its annual gross 

revenues from Federal procurement contracts 

(and subcontracts) and Federal financial 

assistance subject to the Transparency Act, as 

defined at 2 CFR 170.320 (and subawards); 

and 

(B) $25,000,000 or more in annual gross 

revenues from Federal procurement contracts 

(and subcontracts), and Federal financial 

assistance subject to the Transparency Act 

(and subawards); and 

ii. The public does not have access to 

information about the compensation of the 

executives through periodic reports filed 

under section 13(a) or 15(d) of the Securities 

Exchange Act of 1934 (15 U.S.C. 78m(a), 

78o(d)) or section 6104 of the Internal 

Revenue Code of 1986. (To determine if the 

public has access to the compensation 

information, see the U.S. Security and 

Exchange Commission total compensation 

filings at http://www.sec.gov/answers/ 

execomp.htm.) 

2. Where and when to report. You must 

report subrecipient executive total 

compensation described in paragraph c.1. of 

this award term: 

i. To the recipient. 

ii. By the end of the month following the 

month during which you make the subaward. 

For example, if a subaward is obligated on 

any date during the month of October of a 

given year (i.e., between October 1 and 31), 

you must report any required compensation 

information of the subrecipient by November 

30 of that year. 

d. Exemptions 

If, in the previous tax year, you had gross 

income, from all sources, under $300,000, 

you are exempt from the requirements to 

report: 

i. Subawards, 

and 

ii. The total compensation of the five most 

highly compensated executives of any 

subrecipient. 

e. Definitions. For purposes of this award 

term: 

1. Entity means all of the following, as 

defined in 2 CFR part 25: 

i. A Governmental organization, which is 

a State, local government, or Indian tribe; 

ii. A foreign public entity; 

iii. A domestic or foreign nonprofit 

organization; 

iv. A domestic or foreign for-profit 

organization; 

v. A Federal agency, but only as a 

subrecipient under an award or subaward to 

a non-Federal entity. 

2. Executive means officers, managing 

partners, or any other employees in 

management positions. 

3. Subaward: 

i. This term means a legal instrument to 

provide support for the performance of any 

portion of the substantive project or program 

for which you received this award and that 

you as the recipient award to an eligible 

subrecipient. 

ii. The term does not include your 

procurement of property and services needed 

to carry out the project or program (for 

further explanation, see Sec. ll .210 of the 

attachment to OMB Circular A–133, ‘‘Audits 

of States, Local Governments, and Non-Profit 

Organizations’’). 

iii. A subaward may be provided through 

any legal agreement, including an agreement 

that you or a subrecipient considers a 

contract. 

4. Subrecipient means an entity that: 

i. Receives a subaward from you (the 

recipient) under this award; and 

ii. Is accountable to you for the use of the 

Federal funds provided by the subaward. 

5. Total compensation means the cash and 

noncash dollar value earned by the executive 

during the recipient’s or subrecipient’s 

preceding fiscal year and includes the 

following (for more information see 17 CFR 

229.402(c)(2)): 

i. Salary and bonus. 

ii. Awards of stock, stock options, and 

stock appreciation rights. Use the dollar 

amount recognized for financial statement 

reporting purposes with respect to the fiscal 

year in accordance with the Statement of 

Financial Accounting Standards No. 123 

(Revised 2004) (FAS 123R), Shared Based 

Payments. 

iii. Earnings for services under non-equity 

incentive plans. This does not include group 

life, health, hospitalization or medical 

reimbursement plans that do not 

discriminate in favor of executives, and are 

available generally to all salaried employees. 

iv. Change in pension value. This is the 

change in present value of defined benefit 

and actuarial pension plans. 

v. Above-market earnings on deferred 

compensation which is not tax-qualified. 

vi. Other compensation, if the aggregate 

value of all such other compensation (e.g. 

severance, termination payments, value of 

life insurance paid on behalf of the 

employee, perquisites or property) for the 

executive exceeds $10,000. 

[FR Doc. 2010–22705 Filed 9–13–10; 8:45 am] 

BILLING CODE 3110–01–P 

OFFICE OF MANAGEMENT AND 

BUDGET 

2 CFR Subtitle A, Chapter I, and Part 

25 

Financial Assistance Use of Universal 

Identifier and Central Contractor 

Registration 

AGENCY: Office of Federal Financial 

Management, Office of Management and 

Budget. 

ACTION: Final guidance. 

SUMMARY: OMB is issuing guidance to 

Federal agencies concerning two 

requirements for financial assistance 

applicants and recipients, and one 

requirement for first-tier subrecipients. 

An agency under the guidance must 

require applicants other than 

individuals, with some specific 

exceptions, to have Dun and Bradstreet 

Data Universal Numbering System 

(DUNS) numbers and maintain current 

registrations in the Central Contractor 

Registration (CCR) database. An agency 

must require applicants and recipients 

of grants and cooperative agreements to 

comply with the DUNS number and 

CCR requirements by October 1, 2010 

and require applicants and recipients of 

all other financial assistance types to 

comply by October 1, 2011. The 

guidance provides standard wording for 

a new award term that each agency must 


jdjones on DSK8KYBLC1PROD with RULES