4 Grant Mistakes You Don’t Know You’re Making

We’ve gone to the grant management mailbag for some common problems encountered in the “real-world” by “real-life” grant managers. Today we’re looking at four common grant mistakes regarding the un-allowability of public relations costs you may experience when managing your federal grant.

Grant Mistakes: A Grant Manager Writes:

“Are promotional items, such as pens, water bottles, nylon bags, with the federal agency logo allowable?”

They continue: “We use them as part of our outreach to the eligible population that we serve through our federal grant. I read that these types of costs are unallowable as public relations costs, but I also read that as long as they had the federal project logo or name on them, they were allowable. We have also supported community events where the organizers purchase signs or promotional items that display our federal project logo. I’m confused!”

What to do About Public Relations Costs?

What our grant manager is referring to are examples of public relations costs. Here are the general “rules.” If the costs fall into the allowable cost categories for public relations-such as an outreach effort for the award, they would be allowable. On the other hand, if the public relations costs promote the organization (not the award), they would not.

What are Public Relations Costs?

Public relations are defined as community relations and activities dedicated to maintaining the image of the organization, institution, or governmental unit or maintaining or promoting understanding and favorable relations with the community or public at large or any segment of the public.

Two Examples of Public Relations Costs vs. Education and Outreach

Example #1: An organization made souvenir rulers to hand out to the high schools with the project’s name as part of the project outreach to get the kids interested in the project. These costs would likely be allowable. Example #2: An institution had coffee cups with the institution’s name made up and gave those to volunteer board members for their service. These costs would likely be unllowable.

What Public Relataions Costs are Allowable?

There are three types of allowable public relations, according to the federal cost principles regulations: (1) Costs specifically required by the federal award; (2) Costs of communicating with the public and press about specific activities or accomplishments which result from the performance of federal awards (these costs are considered necessary as part of the outreach effort for the federal award); or (3) Costs of conducting general liaison with news media and government public relations officers. These costs are allowable to the extent that such activities are limited to communication and liaison necessary to keep the public informed on matters of public concern, such as notices of federal contract/grant awards, financial matters, etc.

How to Recognize Allowable vs. Unallowable Public Relations

In the “real world,” it can be hard to distinguish between promoting the federal award vs. promoting your organization, institution, or governmental unit. Sometimes the purposes seem to run together… That’s why it’s so important to ensure you have sufficient documentation to show why the costs are allowable vs. unallowable.

• It comes down to making sure the purpose of the spending is part of the allowed outreach and not promoting the organization.

It’s also a good idea to keep a memo with supporting documentation about how and why the spending falls in the allowable categories. (Sometimes, just working through that “how” and “why” process makes it clearer what the intended purpose of the spending is.)

Here are 4 Types of Unallowable Public Relations to Avoid

1) It’s all about “ME.”

• Costs of advertising and public relations designed solely to promote the organization, institution, or governmental unit instead of the federal project are unallowable.

2) What Happens In Vegas, Stays In Vegas?

Costs of meetings, conventions, convocations, or other events related to other activities of the organization are unallowable, including:

• Costs of displays, demonstrations, and exhibits;
• Costs of meeting rooms, hospitality suites, and other special facilities used in conjunction with shows and other special events; and
• Salaries and wages of employees engaged in setting up and displaying exhibits, making demonstrations, and providing briefings;

Read More at https://blog.myfedtrainer.com/grant-management-do-you-make-these-10-mistakes/

3) No More Foam Fingers

• Promotional items and memorabilia costs, including models, gifts, and souvenirs, are unallowable.

If you are purchasing these types of items for your federal award, make sure you have rock-solid documentation of how these costs are considered necessary as part of the federal award’s outreach effort or specifically required by the federal award.

4) Ask Permission, Instead of Begging for Forgiveness

Finally, don’t assume that if the public relations costs are not specifically excluded, they must be allowable. In the Uniform Guidance section § 200.421 Advertising and public relations, it says that unless the cost is explicitly allowed in paragraphs (b) and (d) of this part of the guidance, the costs are unallowable.