October 2024 OMB Changes I Hope Stick Around

HayDay Services is bringing you a series of “how-to” articles related to successful grant management. 

Part 5: OMB Changes

If you manage federal grants in any way, shape, or form, then the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards is your handy (and very detailed guide) to all the rules and regulations you need to follow. If you’re wondering what the heck I’m talking about, you might refer to this behemoth of a document as Uniform Guidance (UG), 2 CFR Part 200, the Super Circular, or the Omni Circular.

We on the same page now?

Okay, the last major overhaul of this document was in December 2014, so we were due for some changes. And let me tell you, I’m really excited about most of the revisions. They are in favor of grant applicants, and as I’m squarely entangled in that world, I’m a fan of anything that makes our work more equitable, fair, and less complicated.

If you’d rather hear about these changes than read about them, check out the latest episode of the Fundraising HayDay Podcast HERE. Or check out this blog post AND the podcast – because the more times you ingest information, the more likely you’ll remember it.

The new revisions went into effect on all grants awarded on October 1, 2024, or later. Those awarded before that date are still governed by the regulations in effect at the time of the grant award. If you’ve got a grant award that was made before October 1, 2024, and you received incremental or supplemental funding, you need to check with your funding agency to see which guidelines the additional funding must follow.

With the new administration in office, it’s quite possible that there will be MAJOR changes to the Uniform Guidance in 2025 and beyond. But until that happens, we are bound by the current set of guidelines.

Before I share some specifics, I want to start with a disclaimer. I am not listing EVERY change in the guidelines. There’s a lot of them, and this blog post would be the next edition of “War and Peace” if I did that. Instead, I’m going to highlight a few things and direct you to some great resources put out by federal agencies that cover things in better detail, specifically:

• US Department of Housing and Urban Development
• US Environmental Protection Agency
• Office of Justice Programs

When in doubt, always refer to the source material itself. You can find the most recent, electronic copy of the Uniform Guidance HERE.

DEFINITION CHANGES

They cleaned up some language, specifically:

• Non-Federal entity is now called either a recipient or subrecipient
• Cost sharing or matching is now only referred to as cost sharing
• Federal awarding agency is simply the federal agency
• They also removed some outdated and/or infrequently used acronyms (YEAH!), and they added some new ones (OH BOY!)

WHISTLEBLOWER PROTECTIONS

If your agency is a recipient or subrecipient of federal funds, your agency is now required to inform employees, in writing, of the employee whistleblower protections. Yes, that means your agency must have a whistleblower protection policy. Check out section 200.217 for more details.

I love this, because as a grant professional, we are often charged with looking at the fine print, denying unsubstantiated charges or claims to a grant program, and ensuring that all federal rules and regulations are followed. If we are not taken seriously or agency employees continue to circumvent the rules, we have an obligation to report said offenses, and we need to understand the protection we are afforded when that happens. Whistleblowing is not something anyone takes lightly, but sometimes it’s necessary.

SIMPLIFICATION OF NOFO (Notice of Funding Opportunity)

I could absolutely squeal and break into some uncool dance moves over this change. For the past year, I’ve spent a big chunk of my time reading 50, 100, and 150+ page NOFOs to try and synthesize a lot of complicated and important details into a 5-page synopsis for clients. It’s never easy, because every agency and sub-agency has its own arrangement of information. Nothing is easily found when it’s never in the same place twice. Moving forward, federal agencies are supposed to arrange all NOFOs in this order:

• Basic Information
• Eligibility
• Program Description
• Application Content and Format
• Submission Requirements and Deadlines
• Application Review Information
• Award Notices
• Post Award Requirements and Administration
• Other Information

PROCUREMENT

First, they removed the prohibition of geographic preferences. Want to keep your federal award dollars in your local economy? You can give preference to local vendors. I love it!

Grant recipients and subrecipients are called to prioritize products and services that can be reused, refurbished, or recycled; contain recycled content; are biobased; are energy and water efficient; and are sustainable. I’m all for helping to save the planet.

In section 200.320, the three types of procurement are spelled out in detail. The highlights are:

• Informal – these are simpler acquisition processed and include micro-purchases and simplified acquisitions.
  1. The micro-purchase threshold was raised from $5,000 to $10,000, and recipients and subrecipients can raise the threshold to $50,000 with approval by the federal agency. This means no price quotes are required. You can simply purchase the item.
  2. Simplified acquisitions (what used to be referred to as small purchases) are for amounts higher than your micro-purchase threshold, but within your simplified acquisition threshold. There is no set dollar amount, but it must be below $350,000 (previously $250,000). Each agency can set its own threshold (as long as it’s less than $350,000) based on internal controls, evaluation of risk, and its documented procurement procedures.
• Formal Procurement Methods – This method is used when you need more input than the informal process. Public notice is a requirement of this methodology, which includes sealed bids and proposals.
  1. Sealed bids – This method is preferable when you are comparing apples to apples and select the responsible bidder whose bid conforms to all the conditions of the invitation and is the lowest price. A great example of this is a road construction project.
  2. Proposals – When you are not comparing apples to apples, proposals may be a better route. Price is a factor, but it is not the only driving force in selecting the most responsible bidder. A good example of this is the purchase of new curriculum for your school system.
• Noncompetitive procurement – This method used to be referred to as sole source. It is when you use a noncompetitive procurement method for one of five reasons:
  1. It is a micro-purchase.
  2. There is only one source available to provide the item/work.
  3. There is a public emergency, and work cannot be delayed by procurement processes.
  4. You get explicit permission from the funding agency to use the noncompetitive process.
  5. You go through a procurement process, but competition does not take place. (Example: you advertise for a sealed bid and only one agency responds so there is no competition.)

To best understand all the ins and out of federal procurement, it’s best to read this section of the Uniform Guidance word for word. You can find it in section 200.320 – Procurement methods.

The Uniform Guidance often refers to the thresholds listed in the FAR (Federal Acquisition Regulation). You can see the most recent guidance on that HERE.

OTHER FUNDING THRESHOLDS RAISED

Procurement is not the only section that upped the numbers for requirement thresholds. For a single item to be considered a piece of equipment, the value was $5,000 or more. Now it’s $10,000 or more. In that same vein, supplies are now considered items less than $10,000. The single audit threshold was $750,000, and it’s now $1,000,000. (That means if your agency spends $1,000,000 or more in federal funds, your agency must complete a single audit.) And the de minimus rate for Indirect Cost Rates was raised from 10% to 15%.

IN CLOSING

Again, this is NOT an exhaustive list of changes, just a highlight of some. It’s best to talk to your funder, read the updated guidance, and attend trainings when possible to better understand how to keep track of everything moving forward. This is more important now than ever as Executive Orders, Presidential Memos, and other directives are quickly changing the federal funding landscape. There have already been instances when new “directives” are in opposition to what’s spelled out in the Uniform Guidance. Yes, it’s a bit of a dumpster fire on wheels right now, but the more we understand what’s said in the Uniform Guidance, the more we can fight for the processes, procedures, and rights of what SHOULD be.

In the meantime, please take a few minutes to celebrate these helpful updates to the Uniform Guidance. I know I am!

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Amanda Day

Amanda Day, GPC, is a national trainer and speaker. With 20 years of grant prospect research, writing, and management experience, she has the knowledge, know-how, and stories to keep every workshop participant and conference attendee engaged and better prepared to succeed in the grant profession. She is well versed in federal and private grant funding, as well as educating up and using your professional network to best build career path. Her passion lies in preparing grant professionals to successfully fund their organizational and community needs, along with meeting their personal career and leadership goals.

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