March 27, 2020

OMB Provides Flexibility for Grant Recipients in Light of COVID-19

3 min

On March 19, 2020, OMB issued M-20-17, "Administrative Relief for Recipients and Applicants of Federal Financial Assistance Directly Impacted by the Novel Coronavirus (COVID-19) due to Loss of Operations," which expanded the scope of recipients outlined in the previous OMB-issued memorandum, M-20-11, "Administrative Relief for Recipients and Applicants of Federal Financial Assistance Directly Impacted by the Novel Coronavirus (COVID-19)."

M-20-11 was issued on March 9, 2020 with the purpose of providing flexibility to the administrative, financial management, and audit requirements for grant recipients performing essential research and services necessary to carry out the emergency response related to COVID-19. M-20-17 provides similar relief but applies this relief to a significantly expanded scope of recipients – essentially all grantees affected by the loss of operational capacity and increased costs due to the COVID-19 crisis.

In particular, the relief OMB provides is a lessening of many of the requirements under the Uniform Guidance (2 CFR Part 200), allowing awarding agencies to:

  • Relax the requirement for active System for Award Management (SAM) registration at the time of application. Additionally, current registrants in SAM with active registrations expiring before May 16, 2020 will be given a one-time extension of 60 days;
  • Allow flexibility with the submission deadlines of competing applications;
  • Waive the need to justify shortening the time frame for emergency NOFOs;
  • Extend awards that are active as of March 31, 2020, and expire on or before December 31, 2020, at no cost for up to 12 months;
  • Accept a statement from recipients with continuation requests scheduled to come in from April 1, 2020 to December 31, 2020, to confirm that they are able to resume or restore their project activities, and that they accept the continued award;
  • Allow recipients with properly documented policies to continue to charge salaries and benefits paid for under current federal awards;
  • Allow recipients to charge incurred costs related to the cancellation of events, travel, or other activities necessary and reasonable for the performance of the award, or the pausing and restarting of grant-funded activities due to the public health emergency.;
  • Waive prior approval requirements;
  • Waive certain procurement requirements;
  • Allow grantees to delay the submission of financial, performance, and other reports for up to three months;
  • Allow grantees to continue to use the currently approved indirect cost rates (i.e., predetermined, fixed, or provisional rates) to recover their indirect costs on federal awards;
  • Allow the grantee to delay submission of any pending financial, performance, and other reports required by the terms of the award for the closeout of expired projects, provided that proper notice about the reporting delay is given by the grantee to the agency; and/or
  • Delay the completion and submission of the Single Audit reporting package, as required under Subpart F of 2 CFR § 200.501 -Audit Requirements, for six (6) months beyond the normal due date.

These concessions are time limited and will be reassessed by OMB 90 days after their issuance.

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While it is without question that the concessions and flexibility under M-20-17 are a welcome development during these challenging times, they leave many questions unanswered, which will ultimately require further guidance. For example, if grantees can use funds to continue paying the salaries of certain personnel who are social distancing and/or sheltering at home, but without substantial programmatic progress, will awarding agencies be willing to add funds to an award budget down the road if funding shortfalls arise? We will of course keep an eye out for this guidance, should it be issued, and keep you apprised. In the meantime, best wishes for a healthy future!

Special thank you to Anna Kaye for her contribution to this article.