What’s the first step in winning the game?

Knowing how to keep score!

Want to know how the “other team” aka Federal Agencies will be judged on the effectiveness of the new uniform guidance?

We dug through the massive piles of documents surrounding the new grant regulations and here is what we discovered…

There are 5 key administrative metrics that Federal agencies will use in determining if the implementation of the new grant regulations was a success or epic fail.

5 Key Administrative Metrics

I wanted to share some insights with you into the reasons behind the metrics and what this could mean for you as an award recipient.

Administrative Metrics:

#1 Has Information Collection Gone Up?

The first of the administrative metrics is “Inventory of OMB-approved Information Collections for Grants and Cooperative Agreements.”

This metrics is all about identifying more opportunities for standardization of information collections government- wide.

COFAR and OMB have a goal to increase standardization of government-wide information collections.

It is OMB’s stated intention to limit non-standard information collection exceptions.

Future Prediction: If you work with a Federal agency that is NOT using non-standard data collection systems, expect them to migrate to the OMB-approved information collection systems in the future.

#2 Have OMB-approved Exceptions Gone Up or Down?

The next of the administrative metrics is the “Number of OMB-approved Exceptions Focused on Program Performance Over Compliance.”

This seemingly simple metric holds many policy changes at its core.

At the heart of the exceptions is the OMB guidance in M–13–17 ‘‘Next Steps in the Evidence and Innovation Agenda.”

This new OMB guidance desires to foster innovative grant management models and cost-effective approaches by including many provisions that strengthen requirements for internal controls (read that as put more responsibility for oversight on award recipients) while promoting innovation in the administration of Federal awards.

Using new approaches such as fixed amount awards, the OMB hopes to minimize the amount of time complying with unnecessary and burdensome administrative requirements, and re-focus award recipients and Federal agencies to achieving program objectives.

Future Predictions: Organizations that have well-trained staff, and support strong internal controls will potentially see benefits from this approach. However, our research indicates comprehensive training on grant management and internal controls outside of a few Finance personnel is the exception and not the norm. The stated goals of this new approach in entrenched bureaucracies at Federal agencies and award recipients will be difficult to achieve in practice.

#3 How Many Fixed Amount Awards Are Being Issued?

The third administrative metrics is the “Number of Fixed Amount Awards Issued”

Fixed Amount Awards are a relatively new concept, where requirements to meet performance milestones take precedence over compliance requirements.

Think of this as “the end justifies the means” type of award, cooperative agreement or contact.

In other words, the award recipient is focused on meeting the milestone and if it costs more or less than expected, the awardee bears the risk or keeps the overage.

Likewise the Federal agency is supposed to focus more on the reaching the outcome goal and less how that milestone was achieved.

Future Prediction: While there will be a strong desire to increase the amount of fixed amount awards and to reduce the administrative burden on monitoring and compliance, in practice Federal agencies will struggle with determining how to best measure non-rules based performance measurements vs. explicit grant regulations and guidance.

Expect to see some stellar waste, fraud and abuse new stories in the future about spending on fixed amount awards.

#4 How Many Agency Exceptions To Federally Negotiated Rates And How Much?

Then the Federal agencies will be scored on the “Number/Impact of Agency Exceptions to the Provision of Federally Negotiated Rates”

This metric has to do with the times when Federal agencies and statutory provisions don’t accept your federally negotiated indirect cost rates.

The goal here is to provide for greater consistency and more transparency in the application of indirect cost rates across all Federal agencies across government.

Future Prediction: This metric will drive greater standardization of rates across agencies and will be a positive step for award recipients.

On a related note, more new awardees will take advantage of the new 10% de-minimis indirect cost rate. Pressure will continue to drive down indirect cost rates and award recipients will increase strategic planning for which side of the “fence” certain costs fall to decrease indirect costs, and explicitly budget and charge support costs as direct costs.

#5 How Many Indirect Cost Rate Extensions Have Been Approved?

Finally, the administrative metrics look at the “Number of Indirect Cost Rate Extensions Approved by Cognizant Agencies.”

This metric is part of the new provision for one-time extensions of up to four years of the current indirect cost rate for non-Federal entities that have a federally negotiated indirect cost rate (subject to review and approval of the cognizant agency.)

In essence, OMB is hoping lots of organizations will just check the box and get 4 year extensions.

That way the Federal government (and the award recipient) won’t have to expend resources for the whole long-drawn-out indirect cost rate proposal and negotiation process.

Future Prediction: Many organizations will recognize the “writing on the wall” and find ways to live within their current indirect cost rates for an extended period of time…say four more years.

Uniform Guidance: last, but not least:

I thought you might also wonder the following:

How often will this data be reported?

The Federal agencies will report this data annually.

Where will this information be stored?

The sources of the data used to access the administrative metrics will be:

• HHS-led data standards repository
• OMB records of exceptions
• Federal agency records of fixed-amount awards collected via MAX
• Indirect cost rate negotiation agencies

Ready to Improve Your Grant Management?

How about you?

Would you like to be a better grant manager?

We have another grant management training seminar coming soon.

Click here to get all the details!

Hope to see you there!

Author:

Lucy Morgan CPA, MBA

CEO, Compliance Warrior

Author of “Decoding Grant Management-The Ultimate Success Guide to the Federal Grant Regulations in 2 CFR Part 200” The 2nd Edition is now available on Amazon in Paperback and Kindle versions.