On March 19, 2020, the Office of Management and Budget (OMB) issued memorandum M-20-17, authorizing federal awarding agencies to take certain actions to provide short-term relief to federal grant recipients affected by COVID-19. The memorandum outlines 13 actions the federal agencies can take, as they deem appropriate, regarding approval of extensions or exemptions of certain federal administrative, financial management, and audit requirements that are under 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance).
It is important for recipients of federal awards to review this memorandum. Appropriate records or documentation must be maintained for certain actions available for approval in order to support the need for the extension or exemption.
The following are some of the most generally-relevant actions that federal agencies are authorized to take:
- Allowability of salaries and other project activities – This action may allow federal awarding agencies to approve recipients to continue charging salaries, benefits, and other costs to current federal awards, as long as the payments are consistent with the recipient’s policy of paying salaries from all sources – federal and non-federal. Appropriate records to substantiate the costs charged to the federal award related to the interruption of operations of services caused by COVID-19 will be required.
- Allowability of costs not normally chargeable to awards – This action, if approved, allows certain costs to be charged to the federal award that are typically not allowable. Examples of these costs include event cancelation costs, travel costs, or costs associated with stopping and restarting the grant-funded activities. Awarding agencies may list additional guidance and costs qualifying for this action on their website along with requirements for recipient documentation.
- Exemption of certain procurement requirements – This action would allow the awarding agency to waive certain procurement requirements, including geographical preferences and contracting with small and minority businesses.
- Extension of financial, performance, and other reporting – This action may allow grantees to delay (up to 3 months beyond the due date) the submission of reports, but may still have the ability to continue to draw down funds.
- Extension of Single Audit submission – Federal award recipients with fiscal year-ends through June 30, 2020, that have not yet filed their Single Audit with the federal clearinghouse, may delay the submission of their Single Audit up to six months beyond the normal due date as set forth in the Uniform Guidance.
These authorized actions will be reassessed by OMB within 90 days from the release of the memorandum. Federal agencies are encouraged to determine the required documentation that is needed and begin to develop the reports required by the federal awarding agency that may be necessary to approve your request.
P&N stands ready to assist with the above actions or other needs your entity may have as you navigate this quickly-changing situation. Reach out to our governmental professionals to start a discussion.