April 15, 2020

OMB Lays the Groundwork for the Delivery of and Reporting on COVID-19 Relief Funds

5 min

To combat the coronavirus disease 2019 (COVID-19), the federal government has enacted a series of massive economic stimulus packages to provide relief to the American public. Because of the urgent nature of the crisis, OMB issued M-20-21, "Implementation Guidance for Supplemental Funding Provided in Response to the Coronavirus Disease 2019 (COVID-19)," to ensure that there is a balance between the rapid delivery of the COVID-19 relief and response efforts and accountability. While this guidance is directed toward federal departments and agencies, to instruct them on how to implement this unprecedented relief effort, grant recipients should also be aware of their agency partners' marching orders and should be monitoring agencies' delivery of COVID-19 relief. This report is another in our series on COVID-19-related OMB memorandums for the grant community, all of which can be found here.

M-20-21, issued on April 10, outlines three core principles for agencies to prioritize while balancing speed and transparency: 1) mission achievement; 2) expediency; and 3) accountability and transparency.

Mission Achievement

OMB directs agencies, when they are considering mission achievement, to: 1) manage COVID-19 relief funds and awards in a manner consistent with their respective mission performance objectives and plans; and 2) incorporate reporting of performance on such funding into their established mission performance plans and reviews. Agencies are also directed to review progress consistent with existing guidance included in OMB Circulars A-11 and A-123 to the maximum extent possible. Appendix A to M-20-21, discussed in more detail below, describes in part agencies' and recipients' monthly reporting requirements for any "large covered funds," defined as any funds provided by any supplemental appropriations for the COVID-19 response to a non-federal entity that exceeds $150,000. Additionally, as required by the CARES Act, OMB, together with the Council of Economic Advisors, the Department of the Treasury, and the Small Business Administration, must provide quarterly reports that outline the effect of COVID-19 relief funds on employment, estimated economic, and other key economic indicators.


The second principle, expediency in awarding funds to meet crucial needs, outlines six considerations agencies should consider to balance expediency and good stewardship when implementing new or modified activities:

  • Ensuring that qualified, skilled, and appropriately trained personnel are overseeing awards made under the new relief legislation;
  • Streamlining regulations and internal processes, including issuing waivers and delegating decision-making where appropriate to empower managed risk-taking and innovative thinking;
  • Balancing the need for competition with timely execution of funding;
  • Balancing the need for expediency with steps to mitigate risk of fraud, waste, abuse, and improper payments;
  • Ensuring that resources go to evidence-based programs whenever possible; and
  • Regularly communicating with and encouraging coordination among state and local governments, tribes, and nonprofit entities for financial assistance, which OMB can facilitate.
Transparency and Accountability

With regard to the third consideration for agencies—transparency and accountability—OMB states that accurate recording and tracking of funds for awards under the relief legislation are "essential to providing relief to citizens and businesses, facilitating oversight, and creating accountability for results." To that end, agencies must continue to make evidence-based decisions, protect information as appropriate, and provide open data for analysis and public use by using sound data management principles. Therefore, agencies must have processes in place to ensure reported data is of sufficient quality for public reporting and internal decision-making. OMB plans to help minimize the burden on agencies by using existing data and reporting tools to gather and present information, and by providing agencies with existing guidance and responsibilities on data quality.

Additionally, the Offices of Inspectors General should develop plans to prevent and detect waste, fraud, and abuse related to agency implementation of the relief legislation, while also working with the newly created Pandemic Response Accountability Committee (PRAC), OMB, and agencies to coordinate COVID-19-related oversight efforts, minimize burden and duplicate efforts, and reprioritize lower-priority audit work.

Temporary Reporting Deadline Adjustments

Finally, under the third principle, OMB asks for agencies to use a risk-based framework to assess the need to adjust existing audit and reporting deadlines over the next 60 days. When assessing, agencies should consider the need to balance existing statutory and regulatory compliance requirements with the influx of the new workload resulting from the COVID-19 pandemic. Additionally, OMB has relaxed certain reporting requirements relating to agency information security programs and performance management.

Appendices A and B – Reporting Instructions

As mentioned above, Appendix A describes implementation requirements of Sections 15010 and 15011 of the CARES Act. These sections require: (1) federal agencies and recipients to report on the use of large covered funds; (2) agencies in coordination with OMB to provide user-friendly means for recipients to meet these requirements; and (3) the PRAC to leverage existing technology and resources to the greatest extent practicable to meet these requirements. The guidance outlined in Appendix A allows agencies and recipients to meet the CARES Act reporting requirements by utilizing existing reporting requirements with the modifications described below, and Appendix B consists of a consolidated timeline for such requirements and modifications.

To assist the government and the public in tracking the use of COVID-19 funds, Appendix A provides extensive guidance to agencies on classifying the expenditure of relief funds. Specifically, OMB expands on previous guidance for use of the disaster emergency fund code (DEFC) and modifies program reporting for COVID-19 activities. It directs agencies to use specific DEFC values in reporting spending to USAspending.gov, to use a specific code when reporting information to the Federal Procurement Data System, and to add "COVID" to as an identifier for COVID-related transactions in the General Services Administration's (GSA's) SmartPay®.

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OMB's guidance delivers at least two important messages. First, the government is exercising flexibility to quickly address the current crisis. Second, because of the nature of this response, OMB fully expects that some funds may be misallocated. Therefore, recipients should closely monitor their federally funded activities and be cognizant of the fact that their agency partners are operating under unusual circumstances. Don't be afraid to ask questions.

As events continue to develop, we expect OMB to publish additional guidance relating to the use of COVID-19 relief efforts. Venable will continue to monitor and report on these developments.

*A special thank you to Anna Kaye for her contribution to this article.