2 CFR 200: What You Need to Know in 2018

For the last year, the grants community has been expecting the Office of Management and Budget (OMB) to incorporate a number of grants-related laws into 2 CFR 200. OMB officials have commented that they are working on amendments, but have not provided an estimation on when the changes will be announced.

In anticipation of the changes, it is important for the grants community to be aware of the legislation that may potentially be incorporated into 2 CFR 200.

• National Defense Authorization Act for Fiscal Year 2017 (NDAA). The NDAA for FY 2017 altered the micro-purchase threshold for procurements made under research awards. Section 217 of the law increases the micro-purchase threshold for Defense Department research awards to $10,000. Additionally, the NDAA for FY 2017 increases the micro-purchase threshold for universities, independent research institutions, and nonprofit research organizations to $10,000 or to “such higher threshold as determined appropriate by the head of the relevant executive agency and consistent with clean audit findings under chapter 75 of title 31, internal institutional risk assessment, or State law.” Federal agencies and OMB have not provided clear guidance on the impact of this provision.
• Digital Accountability and Transparency Act (DATA Act). The DATA Act increases government transparency and accountability by requiring the use of government wide data elements to report Federal spending. The DATA Act required a pilot program to test methods to reduce administrative burden on grant recipients. The Department of Health and Human Services (HHS) recently concluded the grants pilot program and OMB submitted a report to Congress on lessons learned from the pilot program and recommendations for future action. The DATA Act requires OMB to determine whether to apply the DATA Act requirements to grant recipients by August 2018.
• Grants Oversight and New Efficiency Act (GONE Act). The GONE Act requires Federal agencies to report to Congress on grant closeout activities and provide the number of grant award accounts that remain open.
• Buy American Laws. In June 2017, OMB released a memorandum to Federal agencies regarding the applicability of the Buy American Laws. The memorandum stated: “For Federal financial assistance awards, there is no primary law that imposes the Buy American Laws as defined in E.O. 13788, and applicability varies by the authorizing and appropriation statutes imposed on specific Federal financial assistance programs.” The memorandum direct agencies to evaluate and report on how Buy American Laws applied to Federal grants, identify guidance provided to grant recipients regarding compliance with Buy American Laws, and summarize agency compliance with Buy American Laws.
• Never Contract with the Enemy. Section 841 in the NDAA for FY 2015 requires revisions to 2 CFR 200 to incorporate language restricting the awarding of grants, contracts, or cooperative agreements to individuals or entities that are actively opposing U.S. or coalition forces. President Obama signed the law in December 2014.

In addition to the expected amendments, 2 CFR 200.109 requires OMB to review 2 CFR 200 at least every five years after December 26, 2013. OMB has not identified what the review will consist of, or when it may be completed.

Stay tuned!