Subawards

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Subawards Subrecipients

• Linda Zinna
• Steve Etheredge

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Course Objectives

• You will learn to distinguish between subawards,
  subcontracts and subrecipients.
• You will become familiar with legal framework of
  subawards.
• You will understand the USC subaward process.

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Subrecipient

• Definition of a Subrecipient
• The Legal Entity to Which a Subaward is Made and
  Which is Accountable to the Recipient for the Use
  of the Funds Provided
• The Term May Include Foreign or International
  Organizations (Such as Agencies of the United
  Nations) at the Discretion of the Federal
  Awarding Agency

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Subaward

• Definition of a Subaward
• An Award of Financial Assistance in the Form of
  Money, or Property in Lieu of Money, Made Under
  an Award by a Recipient to an Eligible
  Subrecipient or by a Subrecipient to a Lower Tier
  Subrecipient
• The Term Includes Financial Assistance When
  Provided by Any Legal Agreement, Even if the
  Agreement is Called a Contract, but Does Not
  Include Procurement of Goods and Services nor
  Does it Include Any Form of Assistance Which is
  Not an Award

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USC Subaward

• An Agreement That Assigns a Portion of a
  Projects Scope of Work to Another Organization
• Subaward Does Not Create Direct Contractual
  Relationship Between Subrecipient and Awarding
  Agency. Relationship is Between Prime Recipient
  and Subrecipient.
• Protects Both Institutions Outlines
  Subrecipients Responsibilities

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International Subawards

• May or May Not be Subject to Same Sponsor
  Regulations as USC Prime Award
• Funded In US Dollars Only
• May Require Advance Payment
• May be Difficult to Negotiate Due to Local
  Requirements

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Contract

• A Procurement Contract Under an Award or Subaward
  and a Procurement Subcontract Under a Recipient's
  or Subrecipient's Contract

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The Subaward Process

• Step 1 Subaward Approval Process
• Step 2 Subaward Development
• Step 3 Establishing the Agreement
• Step 4 - Monitoring and Administering the
  Subawards

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Step 1Subaward Approval Process

• Request for Subaward Approval by Sponsor
• Scope of Work/Schedule of Deliverables-Subrecipien
  t Responsibilities
• Itemized Budget-Must Follow Same Guidelines and
  Restrictions
• Copy of Subrecipients Negotiated FA Agreement
• Institutional Endorsement by Authorized Signatory
• Certification Form

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Step 2Subaward Development

• PI/Research Administrator Contacts SAM
  Administrator
• SAM Administrator Initiates Purchase Order and
  Enters Information into SAM Subaward Database to
  Generate Subaward Number
• SAM Subaward Administrator Creates and Issues
  Agreement

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Step 2 Subaward Development

• Flowdown Requirements
• Award Terms and Conditions
• General Award Information
• Restrictions (ie Publications, Data/Software,
  Equipment, Travel, Other)
• Assurances and Certifications
• OMB Circular A-110, Appendix A (ie EOE Copeland
  Anti-Kick Back Davis-Bacon Contract Work Hours
  Safety Standards Clean Air and Water Pollution
  Acts Byrd Anti-Lobbying Amendment Debarment and
  Suspension)
• SC Drug Free Workplace
• Acknowledgement/Disclaimer

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Step 2Typical Subaward Sections

• Statement of Purpose
• CFDA Number
• Period of Performance
• Project Direction Staff
• Price, Payment, Invoices
• Allowable Costs
• Accounts, Audits, Records
• Reports
• Liability
• Assurances Certifications

• Patents
• Publications
• Subawards
• Notices
• Amendments
• Humans/Animals
• Termination
• Attachments

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Step 2Subaward Development

• Federal Cost Principles
• Colleges and Universities OMB Circular A-21,
  Cost Principles for Educational Institutions
• State, Local or Indian Tribal Government OMB
  Circular A-87, Cost Principles for State, Local
  and Indian Tribal Governments
• Non-Profit Organizations OMB Circular A-122,
  Cost Principles for Non-Profit Organizations
• Hospitals DHHS Regulation 45 CFR Part 74, App E
• For Profit Organizations 48 CFR Part 31 (FAR
  31.2)

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Step 2Subaward Development

• Federal Administrative Requirements
• Colleges/Universities, Hospitals, Nonprofit
  Organizations OMB Circular A-110, Uniform
  Administrative Requirements for Grants and Other
  Agreements with Institutions of Higher Education,
  Hospitals, and Other Nonprofit Organizations
• State Local Governments OMB Circular A-102,
  Grants and Cooperative Agreements with State and
  Local Governments
• For-Profit Organizations 45 CFR Part 74

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Step 2Subaward Development

• Federal Audit Requirements
• Colleges/Universities, States, Local Governments,
  Non-Profit Organizations, Hospitals OMB
  Circular A-133, Audits of States, Local
  Governments and Non-Profit Organizations
• For-Profit Organizations 45 CFR 74.26

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Step 2Subaward Development

• Patent Rights and Reporting
• Bayh-Dole Act

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Step 3Establishing the Agreement

• Obtain Approval from PI and/or Research
  Administrator
• Contract Negotiation
• Receipt of Fully Executed Copy
• Copies Distributed to CGA and Department

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Step 4Monitoring and Administering the Subaward

• Subrecipient Responsibilities
• Technical/Other Reports as Required by Prime
  Recipients PI
• Invention Reporting (within 2 months after
  disclosure)
• Financial Responsibilities

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Step 4Monitoring and Administering the Subaward

• USC PI Responsibilities
• Technical Monitoring-Make Sure Work is Done in
  Accordance with Agreement
• Approval and Forwarding of Invoices to CGA for
  Payment Processing
• Notifying SAM when Agreements Need to be
  Extended, Terminated or Modified

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Subrecipients
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Subcontractors vs Subrecipients

• Subcontractor - Object Code 52070
• Characteristics Indicative of a Vendor
• Provides the Goods and Services Within Normal
  Business Operations
• Provides Similar Goods or Services to Many
  Different Purchasers
• Operates in a Competitive Environment
• Provides Goods or Services That are Ancillary to
  the Operation of the Federal Program
• Is Not Subject to Compliance Requirements of the
  Federal Program

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Subcontractors vs Subrecipientscontinued

• Subrecipient Object Codes 52076 and 52084
• Characteristics Indicative of a Subrecipient
• Determines Who is Eligible to Receive What
  Federal Financial Assistance
• Has its Performance Measured Against Whether the
  Objectives of the Federal Program are Met
• Has Responsibility for Programmatic Decision
  Making
• Has Responsibility for Adherence to Applicable
  Federal Program Compliance Requirements
• Uses the Federal Funds to Carry Out a Program of
  the Organization as Compared to Providing Goods
  or Services for a Program of the Pass-through
  Entity

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Key Players

• OMB Circular A-133
• SAM
• Principal Investigator
• Contract Grant Accounting

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PIs Responsibility

• Make Sure Work is Done in Accordance with
  Contract
• Approve All Invoices Submitted by Subrecipient
  for Payment
• Verify Money is Spent in Accordance with Grant
  Requirements and USC Procurement Codes
• Keep Appropriate Documentation and Accompanying
  Invoices

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Contract Grants Responsibilities

• Monitor Subrecipients
• Request Annual Audit from Subrecipient
• PI Certification
• Keep Log for Auditors
• Follow up on Lack of Response
• Greater Than 500,000 in Awards

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Conclusions

• You are able to distinguish between subawards,
  subcontracts and subrecipients.
• You are familiar with legal framework of
  subawards.
• You understand the USC subaward process.