# 47 Ill. Adm. Code 1.APPENDIX: Section 1.APPENDIX A Office of Management and Budget Circular A-102

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## Section

- **Citation:** 47 Ill. Adm. Code 1.APPENDIX
- **Heading:** Section 1.APPENDIX A Office of Management and Budget Circular A-102
- **Jurisdiction:** Illinois
- **Kind:** Regulations
- **Status:** In force
- **Text as of:** August 14, 2026
- **Source:** Compiled text
- **Location:** Illinois Administrative Code / Title 47 HOUSING AND COMMUNITY DEVELOPMENT / CHAPTER I: DEPARTMENT OF COMMERCE AND ECONOMIC OPPORTUNITY / Part 1 STANDARD GRANT ADMINISTRATIVE REQUIREMENTS / Section 1.APPENDIX A  Office of Management and Budget Circular A-102

## Text

on with a contract to secure fulfillment of all contractor's
obligations under such contract.
c.         A payment bond on the part of the contractor for 100 percent
of the contract price. - A "payment bond" is one executed in
connection with a contract to assure payment as required by law of all persons
supplying labor and material in the execution of the work provided for in the
contract.
3.         Where the Federal Government guarantees or insures the
repayment of money borrowed by the grantee, the Federal agency, at its
discretion, may require adequate bonding and insurance if the bonding and
insurance requirements of the grantee are not deemed adequate to protect the interest
of the Federal Government.  (See 47 Ill. Adm. Code 1.50(c), Cash Management)
4.         Where bonds are required in the situations described above,
the bonds shall be obtained from companies holding certificates of authority as
acceptable sureties (31 CFR 223).
Attachment C:  Retention and
Custodial Requirements for Records
1.         This Attachment sets forth record retention requirements for
grants. Federal grantor agencies shall not impose any record retention
requirements upon grantees other than those described below.
2.         Financial records, supporting documents, statistical records,
and all other records pertinent to a grant shall be retained for a period of
three years, with the following qualifications.
a.         If any litigation, claim or audit is started before the
expiration of the 3-year period, the records shall be retained until all
litigations, claims, or audit findings involving the records have been
resolved.
b.         Records for nonexpendable property acquired with Federal funds
shall be retained for 3 years after its final disposition.
c.         When records are transferred to or maintained by the Federal
sponsoring agency, the 3-year retention requirement is not applicable to the
grantee.
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be retained until all
litigations, claims, or audit findings involving the records have been
resolved.
b.         Records for nonexpendable property acquired with Federal funds
shall be retained for 3 years after its final disposition.
c.         When records are transferred to or maintained by the Federal
sponsoring agency, the 3-year retention requirement is not applicable to the
grantee.
3.         The retention period starts from the date of the submission of
the final expenditure report or, for grants that are renewed annually, from the
date of the submission of the annual financial status report.
4.         Grantees should be authorized by the Federal grantor agency,
if they so desire, to substitute microfilm copies in lieu of original records.
(The Department will forward all requests to microfilm records to the Secretary
of State's Record Commission, which will render a decision based on the Secretary
of State Regulations (44 Ill. Adm. Code 4000) of the Local Records Commission
and Local Records Act (Ill. Rev. Stat. 1983, ch. 116, pars. 43.102 et seq.).)
5.         The Federal grantor agency shall request transfer of certain
records to its custody from grantees when it determines that the records
possess long-term retention value.  However, in order to avoid duplicate
record-keeping, a Federal grantor agency may make arrangements with grantees to
retain any records that are continuously needed for joint use.  (The Department
will take possession of grant records only when the Grantee no longer exists.)
6.         The head of the Federal grantor agency and the Comptroller
General of the United States, or any of their duly authorized representatives,
shall have access to any pertinent books, documents, papers, and records of
grantees and subgrantees to make audits, examinations, excerpts and
transcripts.
7
) and advances made to tribal organizations
pursuant to section 102, 103, or 104 of the Indian Self Determination Act
(Public Law 93-638).
3.         Proceeds from the sale of real and personal property, either
provided by the Federal Government or purchased in whole or part with Federal
funds, shall be handled in accordance with Attachment N to this Circular
pertaining to Property Management.
4.         Unless the grant agreement provides otherwise, grantees shall
have no obligation to the Federal Government with, respect to royalties
received as a result of copyrights or patents produced under the grant or other
agreement.  (See paragraph 7, Attachment N.)
5.         All other program income earned during the grant period shall
be retained by the grantee and, in accordance with the grant agreement, shall
be:
a.         Added to funds committed to the project by the grantor and
grantee and be used to further eligible program objectives.
b.         Used to finance the non-Federal share of the project when
approved by the Federal Sponsoring agency; or
c.         Deducted from the total project costs for the purpose of
determining the net costs on which the Federal share of costs will be based.
6.         Federal grantor agencies shall require the grantees to record
the receipt and expenditure of revenues (such as taxes, special assessments, levies,
fines, etc.) as a part of grant project transactions when such revenues are
specifically earmarked for a grant project in accordance with grant agreements.
Attachment F:  Matching Share
1.         This Attachment sets forth criteria and procedures for the
allowability of cash in-kind contributions made by grantees, subgrantees or
third parties in satisfying cost sharing and matching requirements of Federal
grantor agencies.
2.         The following definitions apply for the purpose of this
Attachment:
a.         Project Costs.  Project costs are all allowable costs as set
forth in Federal Management Circular No
criteria and procedures for the
allowability of cash in-kind contributions made by grantees, subgrantees or
third parties in satisfying cost sharing and matching requirements of Federal
grantor agencies.
2.         The following definitions apply for the purpose of this
Attachment:
a.         Project Costs.  Project costs are all allowable costs as set
forth in Federal Management Circular No. 74-4 incurred by a grantee and the
value of the in-kind contribution made by the grantee or third parties in
accomplishing the objectives of the grant during the project or program period.
b.         Cost Sharing and Matching.  In general, cost sharing and
matching represents that portion of project costs not borne by the Federal
Government. Usually, a minimum percentage for matching share is prescribed by
program legislation, and matching share requirements are included in the grant
agreements.
c.         Cash Contributions.  Cash contributions represent the
grantee's cash outlay, including the outlay of money contributed to the grantee
by other public agencies and institutions, and private organizations and
individuals.  When authorized by Federal legislation, Federal funds received
from other grants may be considered as grantees' cash contributions.
d.         In-kind Contributions.  In-kind contributions represent the
value of noncash contributions provided by the grantee, and non-Federal
parties. Only when authorized by Federal legislation may property purchased
with Federal funds be considered as the grantee's in-kind contributions.
In-kind contributions may be in the form of charges for real property and
nonexpendable personal property and the value of goods and services directly
benefiting and specifically identifiable to the project or program.
3.         General guidelines for computing cost sharing or matching are
as follows:
a.         Cost sharing or matching share may consist of:
1)         Charges incurred by the grantee as project costs
y be in the form of charges for real property and
nonexpendable personal property and the value of goods and services directly
benefiting and specifically identifiable to the project or program.
3.         General guidelines for computing cost sharing or matching are
as follows:
a.         Cost sharing or matching share may consist of:
1)         Charges incurred by the grantee as project costs.  (Not all
charges require cash outlays during the grant period by the grantee; examples
are depreciation and use charges for buildings and equipment.)
2)         Project costs financed with cash contributed or donated to the
grantee by other non-Federal public agencies and institutions, and private
organizations and individuals.
3)         Project costs represented by services and real or personal
property, or use thereof, donated by other public agencies and institutions,
and private organizations and individuals.
b.         All contributions, both cash and in-kind, shall be accepted as
part of the grantee's matching share when such contributions meet all of the
following criteria:
1)         Are verifiable from the grantee's records;
2)         Are not included as contributions for any other
federally-assisted program;
3)         Are necessary and reasonable for proper and efficient
accomplishment of project objectives;
4)         Are types of charges that would be allowable under FMC 74-4.
5)         Are not paid by the Federal Government under another
assistance agreement unless authorized under the other agreement and the laws
and regulations it is subject to.
6)         Are provided for in the approved budget when required by the
Federal agency; and
7)         Conform to other provisions of this Attachment.
4.         Values for grantee in-kind contributions will be established
at the grantee's actual cost in accordance with FMC 74-4.
5.         Specific procedures for the grantees in establishing the value
of in-kind contributions from non-Federal third parties are set forth below:
a
pproved budget when required by the
Federal agency; and
7)         Conform to other provisions of this Attachment.
4.         Values for grantee in-kind contributions will be established
at the grantee's actual cost in accordance with FMC 74-4.
5.         Specific procedures for the grantees in establishing the value
of in-kind contributions from non-Federal third parties are set forth below:
a.         Valuation of volunteer services.  Volunteer services may be
furnished by professional and technical personnel, consultants, and other
skilled and unskilled labor.  Volunteered service may be counted as cost
sharing or matching if the service is an integral and necessary part of an
approved program.  ("Integral and necessary" is defined as an
allowable cost for the program if purchased.)
1)         Rates for volunteer services.  Rates for volunteers should be
consistent with those paid for similar work in other activities of the State or
local government.  In those instances in which the required skills are not
found in the grantee organization, rates should be consistent with those paid
for similar work in the labor market in which the grantee competes for the kind
of services involved.  (Rates shall be based on the Department of Employment
Security's Occupational Employment Statistic Survey.)
2)         Volunteers employed by other organizations.  When an employer
other than the grantee furnishes the services of an employee, these services
shall be valued at the employee's regular rate of pay (exclusive of fringe
benefits and overhead cost) provided these services are in the same skill for
which the employee is normally paid.
b.         Valuation of donated expendable personal property.  Donated
expendable personal property includes such items as expendable equipment,
office supplies, laboratory supplies, or workshop and classroom supplies
lued at the employee's regular rate of pay (exclusive of fringe
benefits and overhead cost) provided these services are in the same skill for
which the employee is normally paid.
b.         Valuation of donated expendable personal property.  Donated
expendable personal property includes such items as expendable equipment,
office supplies, laboratory supplies, or workshop and classroom supplies.
Values assessed to expendable personal property included in the cost or matching
share should be reasonable and should not exceed the fair market value of the
property at the time of the donation.
c.         Valuation of donated nonexpendable personal property,
buildings and land or use thereof.
1)         The method used for charging matching share for donated
nonexpendable personal property, buildings, and land may differ depending upon
the purpose of the grant as follows:
a)         If the purpose of the grant is to furnish equipment,
buildings, or land to the grantee or otherwise provide a facility, the total
value of the donated property may be claimed as a matching share.
b)         If the purpose of the grant is to support activities that
require the use of equipment, buildings, or land on a temporary or part-time
basis, depreciation or use charges for equipment and buildings may be made.
The full value of equipment or other capital assets and fair rental charges for
land may be made provided that the grantor agency has approved the charges.
2)         The value of donated property will be determined in accordance
with the usual accounting policies of the grantee with the following
qualifications:
a)         Land and Buildings.  The value of donated land and buildings
may not exceed its fair market value, at the time of donation to the grantee as
established by an independent appraiser (e.g., certified real property
appraiser or GSA representatives) and certified by a responsible official of
the grantee.
b)         Nonexpendable personal property
grantor agencies shall not impose
additional standards on grantees unless specifically provided for in other
Attachments to this Circular.  However, grantor agencies are encouraged to make
suggestions and assist the grantees in establishing or improving financial
management systems when such assistance is needed or requested.
2.         Grantee financial management systems shall provide for:
a.         Accurate, current, and complete disclosure of the financial
results of each grant program in accordance with reporting requirements set
forth in Attachment H to this Circular.  When a Federal grantor agency requires
reporting on an accrual basis, the grantee shall not be required to establish
an accrual accounting system but shall develop such accrual data on its reports
on the basis of an analysis of the documentation on hand.
b.         Records that identify adequately the source and application of
funds for grant-supported activities.  These records shall contain information
pertaining to Federal awards and authorizations, obligations, unobligated
balances, assets, liabilities, outlays, and income.
c.         Effective control over and accountability for all funds,
property, and other assets.  Grantees shall adequately safeguard all such
assets and shall assure that they are used solely for authorized purposes. (See
47 Ill. Adm. Code 1.90, Financial Management Standards.)
d.         Comparison of actual outlays with budgeted amounts for each
grant. Also, relation of financial information with performance or productivity
data, including the production of unit cost information whenever appropriate
and required by the grantor agency.
e.         Procedures to minimize the time elapsing between the transfer
of funds from the U.S. Treasury and the disbursement by the grantee, whenever
funds are advanced by the Federal Government.  When advances are made by a
letter-of-credit method, the grantee shall make drawdowns from the U.S
request advances and
reimbursement when the letter-of-credit method is not used; and promulgates
standard forms incident thereto.  Grantees when obtaining financial information
required by Federal agencies from subgrantees are not required to use the forms
contained in this Attachment.
2.         The following definitions apply for purposes of this
Attachment:
a.         Accrued expenditures.  Accrued expenditures are the charges
incurred by the grantee during a given period requiring the provision of funds
for: (1) goods and other tangible property received; (2) services performed by
employees, contractors, subgrantees, and other payees; and (3) other amounts
becoming owed under programs for which no current services or performance is
required such as annuities, insurance claims, and other benefit payments.
b.         Accrued income.  Accrued income is the sum of (1) earnings
during a given period from (i) services performed by the grantee; and (ii)
goods and other tangible property delivered to purchasers; and (2) amounts
becoming owed to the grantee for which no current services or performance is
required by the grantee.
c.         Federal funds authorized.  Federal funds authorized are the
total amount of Federal funds obligated by the Federal Government for use by
the grantee.  This amount may include any authorized carryover of unobligated
funds from prior fiscal years when permitted by law or agency regulation.
d.         In-kind contributions.  In-kind contributions are defined in
Attachment F to this Circular.
e.         Obligations.  Obligations are the amounts of orders placed,
contracts and grants awarded, services received, and similar transactions
during a given period that will require payment by the grantee during the same
or a future period.
f.          Outlays.  Outlays or expenditures represent charges made to
the project or program.  They may be reported on a cash or accrual basis
rcular.
e.         Obligations.  Obligations are the amounts of orders placed,
contracts and grants awarded, services received, and similar transactions
during a given period that will require payment by the grantee during the same
or a future period.
f.          Outlays.  Outlays or expenditures represent charges made to
the project or program.  They may be reported on a cash or accrual basis. For
reports prepared on a cash basis, outlays are the sum of actual cash
disbursements for direct charges for goods and services, the amount of indirect
expense charged, the value of in-kind contributions applied, and the amount of
cash advances and payments made to subgrantees. For reports prepared on an
accrual basis, outlays are the sum of actual cash disbursements for direct
charges for goods and services, the amount of indirect expense incurred, the
value of in-kind contributions applied, and the net increase (or decrease) in
the amounts owed by the grantee for goods and other property received, for
services performed by employees, contractors, subgrantees and other payees and
other amounts becoming owed under programs for which no current services or
performance are required such as annuities, insurance claims, and other benefit
payments.
g.         Program income.  Program income is defined in Attachment E of
this Circular.  It may be reported on a cash or accrual basis, whichever is
used for reporting outlays.
h.         Unobligated balance.  The unobligated balance is the portion
of the funds authorized by the Federal agency that has not been obligated by
the grantee and is determined by deducting the cumulative obligations from the
cumulative funds authorized.
i.          Unliquidated obligations.  For reports prepared on a cash
basis, unliquidated obligations represent the amount of obligations incurred by
the grantee that has not been paid
ed balance is the portion
of the funds authorized by the Federal agency that has not been obligated by
the grantee and is determined by deducting the cumulative obligations from the
cumulative funds authorized.
i.          Unliquidated obligations.  For reports prepared on a cash
basis, unliquidated obligations represent the amount of obligations incurred by
the grantee that has not been paid.  For reports prepared on an accrued
expenditure basis, they represent the amount of obligations incurred by the
grantee for which an outlay has not been recorded.
Attachment I:  Monitoring and
Reporting of Program Performance
1.         This Attachment sets forth the procedures for monitoring and
reporting program performance under Federal grants.  These procedures are
designed to place greater reliance on grantees to manage the day-to-day
operations of the grant-supported activities.
2.         Grantees shall constantly monitor the performance under
grant-supported activities to assure that time schedules are being met,
projected work units by time periods are being accomplished, and other
performance goals are being achieved.  This review shall be made for each
program, function, or activity of each grant as set forth in the approved grant
application or award document.
3.         Grantees shall submit a performance report for each grant
which briefly presents the following for each program, function, or activity
involved as prescribed by the Federal agency:
a.         A comparison of actual accomplishments to the goals
established for the period.  Where the output of grant programs can be readily
quantified, such quantitative data should be related to cost data for
computation of unit costs.
b.         Reasons why established goals were not met.
c.         Other pertinent information including, when appropriate,
analysis and explanation of cost overruns or high unit costs.
4
tual accomplishments to the goals
established for the period.  Where the output of grant programs can be readily
quantified, such quantitative data should be related to cost data for
computation of unit costs.
b.         Reasons why established goals were not met.
c.         Other pertinent information including, when appropriate,
analysis and explanation of cost overruns or high unit costs.
4.         Between the required performance reporting dates, events may
occur which have significant impact upon the project or program.  In such
cases, the grantee shall inform the grantor agency as soon as the following
types of conditions become known:
a.         Problems, delays, or adverse conditions which will materially
affect the ability to attain program objectives, prevent the meeting of time
schedules and goals, or preclude the attainment of project work units by
established time periods.  This disclosure shall be accompanied by a statement
of the action taken, or contemplated, and any Federal assistance needed to resolve
the situation.
b.         Favorable developments or events which enable meeting time
schedules and goals sooner than anticipated or producing more work units than
originally projected.
5.         If any performance review conducted by the grantee discloses
the need for change in the budget estimates, the grantee shall submit a request
for budget revision.
6.         The grantor agency shall make site visits as frequently as
practicable to:
a.         Review program accomplishments and management control systems.
b.         Provide such technical assistance as may be required.
Attachment L:  Grant Closeout
Procedures
1.         This Attachment prescribes uniform closeout procedures for
grantees.
2.         The following definitions shall apply for the purpose of the
Attachment:
a.         Grant closeout
quently as
practicable to:
a.         Review program accomplishments and management control systems.
b.         Provide such technical assistance as may be required.
Attachment L:  Grant Closeout
Procedures
1.         This Attachment prescribes uniform closeout procedures for
grantees.
2.         The following definitions shall apply for the purpose of the
Attachment:
a.         Grant closeout.  The closeout of a grant is the process by
which a Federal grantor agency determines that all applicable administrative
actions and all required work of the grant have been completed by the grantee
and the grantor.
b.         Date of completion.  The date when all work under a grant is
completed or the date in the grant award document, or any supplement or
amendment thereto, on which Federal assistance ends.
c.         Termination.  The termination of a grant means the
cancellation of Federal assistance, in whole or in part, under a grant at any
time prior to the date of completion.
d.         Suspension.  The suspension of a grant is an action by a
Federal grantor agency which temporarily suspends Federal assistance under the
grant pending corrective action by the grantee or pending a decision to
terminate the grant by the grantor agency.
e.         Disallowed costs.  Disallowed costs are those charges to a
grant which the grantor agency or its representative determines to be
unallowable. (See Federal Management Circular No. 74-4.)
3.         All Federal grantor agencies shall establish grant closeout
procedures which include the following requirements:
a.         Upon request, the Federal grantor agency shall make prompt
payments to a grantee for allowable reimbursable costs under the grant being
closed out.
b.         The grantee shall immediately refund to the grantor agency any
balance of unobligated (unencumbered) cash advanced to the grantee that is not
authorized to be retained by the grantee for use on other grants.
c
ce beneficial results commensurate
with the further expenditure of funds.  The two parties shall agree upon the
termination conditions, including the effective date and, in the case of
partial terminations, the portions to be terminated. The grantee shall not
incur new obligations for the terminated portion after the effective date, and
shall cancel as many outstanding obligations as possible.  The Federal agency
shall allow full credit to the grantee for the Federal share of the
noncancellable obligations, properly incurred by the grantee prior to
termination.
Attachment N:  Property
Management Standards
1.         This Attachment prescribes uniform standards governing the
utilization and disposition of property furnished by the Federal Government or
acquired in whole or in part with Federal funds or whose cost was charged to a
project supported by a Federal grant.  Federal grantor agencies shall require
grantees to observe these standards under grants from the Federal Government
and shall not impose additional requirements unless specifically required by
Federal law.  The grantees shall be authorized to use their own property management
standards and procedures as long as the provisions of this Attachment are
included.
2.         The following definitions apply for the purpose of this
Attachment:
a.         Real property.  Real property means land, including land
improvements, structures and appurtenances thereto, excluding movable machinery
and equipment.
b.         Personal property.  Personal property of any kind except real
property. It may be tangible -- having physical existence, or intangible --
have no physical existence, such as patents, inventions, and copyrights.
c.         Nonexpendable personal property.  Nonexpendable personal
property means tangible personal property having a useful life of more than one
year and an acquisition cost of $300 or more per unit
y.  Personal property of any kind except real
property. It may be tangible -- having physical existence, or intangible --
have no physical existence, such as patents, inventions, and copyrights.
c.         Nonexpendable personal property.  Nonexpendable personal
property means tangible personal property having a useful life of more than one
year and an acquisition cost of $300 or more per unit.  A grantee may use its
own definition of nonexpendable personal property provided that such definition
would at least include all tangible personal property as defined above.
d.         Expendable personal property.  Expendable personal property
refers to all tangible personal property other than nonexpendable property.
e.         Excess property.  Excess property means property under the
control of any Federal agency which, as determined by the head thereof, is no
longer required for its needs or discharge of its responsibilities.
f.          Acquisition cost of purchased nonexpendable personal
property. Acquisition cost of an item of purchased nonexpendable personal
property means the net invoice unit price of the property including the cost of
modifications, Attachments, accessories, or auxiliary apparatus necessary to
make the property usable for the purpose for which it was acquired.  Other
charges such as the cost of installation, transportation, taxes, duty or
protective in-transit insurance, shall be included or excluded from the unit  acquisition
cost in accordance with the grantee's regular accounting practices.
g.         Exempt property.  Exempt property means tangible personal
property acquired in whole or in part with Federal funds, and title to which is
vested in the recipient without further obligation to the Federal Government
except as provided in subparagraph 6a below.  Such unconditional vesting of
title will be pursuant to any Federal legislation that provides the Federal
sponsoring agency with adequate authority.
3.         Real property
tangible personal
property acquired in whole or in part with Federal funds, and title to which is
vested in the recipient without further obligation to the Federal Government
except as provided in subparagraph 6a below.  Such unconditional vesting of
title will be pursuant to any Federal legislation that provides the Federal
sponsoring agency with adequate authority.
3.         Real property.  Each Federal grantor agency shall prescribe
requirements for grantees concerning the use and disposition of real property
funded partly or wholly by the Federal Government.  Unless otherwise provided
by statute, such requirements, as a minimum, shall contain the following:
a.         Title to real property shall vest in the recipient subject to
the condition that the grantee shall use the real property for the authorized
purpose of the original grant as long as needed.
b.         The grantee shall obtain approval by the grantor agency for
the use of the real property in other projects when the grantee determines that
the property is no longer needed for the original grant purposes. Use in other
projects shall be limited to those under other Federal grant programs, or
programs that have purposes consistent with those authorized for support by the
grantor.
c.         When the real property is no longer needed as provided in a
and b above, the grantee shall request disposition instructions from the
Federal agency or its successor Federal agency.  The Federal agency shall
observe the following rules in the disposition instructions:
1)         The grantee may be permitted to retain title after it
compensates the Federal Government in an amount computed by applying the
Federal percentage of participation in the cost of the original project to the
fair market value of the property
is no longer needed, the grantee shall report the property to the
Federal agency for further agency utilization.
If the Federal agency has no further need for the property,
it shall be declared excess and reported to the General Services
Administration. Appropriate disposition instructions will be issued to the
recipient after completion of the Federal agency review.
5.         Exempt property.  When statutory authority exists title to
nonexpendable personal property acquired with project funds shall be vested in
the recipient upon acquisition unless it is determined that to do so is not in
the furtherance of the objectives of the Federal sponsoring agency.  When title
is vested in the recipient the recipient shall have no other obligation or
accountability to the Federal Government for its use or disposition except as
provided in 6a below.
6.         Other nonexpendable property.  When other nonexpendable
tangible property is acquired by a grantee with project funds title shall not
be taken by the Federal Government but shall vest in the grantee subject to the
following conditions:
a.         Right to transfer title.  For items of nonexpendable personal
property having a unit acquisition cost of $1,000 or more, the Federal agency
may reserve the right to transfer the title to the Federal Government or to a
third party named by the Federal Government when such third party is otherwise
eligible under existing statutes.  Such reservation shall be subject to the
following standards:
1)         The property shall be appropriately identified in the grant or
otherwise made known to the grantee in writing.
2)         The Federal agency shall issue disposition instructions within
120 calendar days after the end of the Federal support of the project for which
it was acquired.  If the Federal agency fails to issue disposition instructions
within the 120 calendar-day period, the grantee shall apply the standards of subparagraph
6b and 6c as appropriate
ge of Federal
participation in the cost of the original project or program to the current
fair market value of the property. If the grantee has no need for the property
and the property has further use value, the grantee shall request disposition
instructions from the original grantor agency.
The Federal agency shall determine whether the property can
be used to meet the agency's requirements.  If no requirement exists within
that agency, the availability of the property shall be reported, in accordance
with the guidelines of the Federal Property Management Regulations (FPMR), to
the General Services Administration by the Federal agency to determine whether
a requirement for the property exists in other Federal agencies.  The Federal
agency shall issue instructions to the grantee no later than 120 days after the
grantee request and the following procedures shall govern:
a)         If so instructed or if disposition instructions are not issued
within 120 calendar days after the grantee's request, the grantee shall sell
the property and reimburse the Federal agency an amount computed by applying to
the sales proceeds the percentage of Federal participation in the cost of the
original project or program.  However, the  grantee shall be permitted to
deduct and retail from the Federal share $100 or ten percent of the proceeds,
whichever is greater, for the grantee's selling and handling expenses.
b)         If the grantee is instructed to ship the property elsewhere
the grantee shall be reimbursed by the benefiting Federal agency with an amount
which is computed by applying the percentage of the grantee participation in
the cost of the original grant project or program to the current fair market
value of the property, plus any reasonable shipping or interim storage costs
incurred.
c)         If the grantee is instructed to otherwise dispose of the
property, the grantee shall be reimbursed by the Federal agency for such costs
incurred in its disposition.
d
plying the percentage of the grantee participation in
the cost of the original grant project or program to the current fair market
value of the property, plus any reasonable shipping or interim storage costs
incurred.
c)         If the grantee is instructed to otherwise dispose of the
property, the grantee shall be reimbursed by the Federal agency for such costs
incurred in its disposition.
d.         Property management standards for nonexpendable property.  The
grantee's property management standards for nonexpendable personal property
shall include the following procedural requirements:
1)         Property records shall be maintained accurately and shall
include:
a)         A description of the property.
b)         Manufacturer's serial number, model number, Federal stock
number, national stock number, or other identification number.
c)         Source of the property including grant or other agreement
number.
d)         Whether title vests in the grantee or the Federal Government.
e)         Acquisition date (or date received, if the property was
furnished by the Federal Government) and cost.
f)         Percentage (at the end of the budget year) of Federal
participation in the cost of the project or program for which the property was
acquired. (Not applicable to property furnished by the Federal Government.)
g)         Location, use and condition of the property and the date the
information was reported.
h)         Unit acquisition cost.
i)          Ultimate disposition data, including date of disposal and
sales price or the method used to determine current fair market value where a
grantee compensates the Federal agency for its share.
2)         Property owned by the Federal Government must be marked to
indicate Federal ownership.
3)         A physical inventory of property shall be taken and the
results reconciled with the property records at least once every two years
ng date of disposal and
sales price or the method used to determine current fair market value where a
grantee compensates the Federal agency for its share.
2)         Property owned by the Federal Government must be marked to
indicate Federal ownership.
3)         A physical inventory of property shall be taken and the
results reconciled with the property records at least once every two years. Any
differences between quantities determined by the physical inspection and those
shown in the accounting records shall be investigated to determine the causes
of the difference.  The grantee shall, in connection with the inventory, verify
the existence, current utilization, and continued need for the property.
4)         A control system shall be in effect to insure adequate
safeguards to prevent loss, damage, or theft of the property.  Any loss, damage
or theft of nonexpendable property shall be investigated and fully documented;
if the property was owned by the Federal Government, the grantee shall promptly
notify the Federal agency.
5)         Adequate maintenance procedures shall be implemented to keep
the property in good condition.
6)         Where the grantee is authorized or required to sell the
property, proper sales procedures shall be established which would provide for
competition to the extent practicable and result in the highest possible
return.
7.         Expendable personal property.  Title to expendable personal
property shall vest in the grantee upon acquisition.  If there is a residual
inventory of such property exceeding $1,000 in total aggregate fair market
value, upon termination or completion of the grant, and if the property is not
needed for any other federally sponsored project or program, the grantee shall
retain the property for use on nonfederally sponsored activities, or sell it,
but must in either case, compensate the Federal Government for its share.  The
amount of compensation shall be computed in the same manner as nonexpendable
personal property.
8
nation or completion of the grant, and if the property is not
needed for any other federally sponsored project or program, the grantee shall
retain the property for use on nonfederally sponsored activities, or sell it,
but must in either case, compensate the Federal Government for its share.  The
amount of compensation shall be computed in the same manner as nonexpendable
personal property.
8.         Intangible property.
a.         Inventions and patents.  If any program produces patentable
items, patent rights, processes, or inventions, in the course of work sponsored
by the Federal Government, such fact shall be promptly and fully reported to
the Federal agency.  Unless there is a prior agreement between the grantee and
the Federal agency on disposition of such items, the Federal agency shall
determine whether protection on the invention or discovery shall be sought.
The Federal agency will also determine how the rights in the invention or
discovery, including rights under any patent issued thereon, shall be allocated
and administrated in order to protect the public interest consistent with
"Government Patent Policy"   (President's Memorandum for Heads of
Executive Department and Agencies, August 23, 1971, and statement of Government
Patent Policy as printed in 36 FR 16889).
b.         Copyrights.  Except as otherwise provided in the terms and
conditions of the agreement the author or the grantee organization is free to
copyright any books, publications, or other copyrightable materials developed
in the course of or under a Federal agreement, but the Federal agency shall
reserve a royalty-free nonexclusive and irrevocable right to reproduce,
publish, or otherwise use, and to authorize others to use the work for
Government purposes.
9.         Excess personal property.  When title to excess property is
vested in grantees such property shall be accounted for and disposed of in
accordance with paragraphs 6c and 6d of this Attachment.
Attachment O:  Procurement
Standards
1
r more significant aspects of this Attachment.  The grantor
agency shall notify the grantee in writing, with a copy of such notification to
the OFPP.
7.         Code of Conduct.  Grantees shall maintain a written code or
standards of conduct which shall govern the performance of their officers,
employees or agents engaged in the award and administration of contracts
supported by Federal funds.  No employee, officer or agent of the grantee shall
participate in selection, or in the award or administration of a contract
supported by Federal funds if a conflict of interest, real or apparent, would
be involved.  Such a conflict would arise when:
a.         The employee, officer or agent;
b.         Any member of his immediate family;
c.         His or her partner; or
d.         An organization which employs, or is about to employ, any of
the above, has a financial or other interest in the firm selected for award.
The grantee's officers, employees or agents shall neither
solicit nor accept gratuities, favors or anything of monetary value from
contractors, potential contractors, or parties to subagreements.  Grantees may
set minimum rules where the financial interest is not substantial or the gift
is an unsolicited item of nominal intrinsic value.
To the extent permitted by the State or local law or
regulations, such standards of conduct shall provide for penalties, sanctions,
or other disciplinary actions for violations of such standards by the grantee's
officers, employees, or agents, or by contractors or their agents.
8.         Procurement Procedures.  The grantee shall establish
procurement procedures which provide that proposed procurement actions shall be
reviewed by grantee officials to avoid the purchase of unnecessary or
duplicative items.  Consideration should be given to consolidation or breaking
out to obtain a more economical purchase
cers, employees, or agents, or by contractors or their agents.
8.         Procurement Procedures.  The grantee shall establish
procurement procedures which provide that proposed procurement actions shall be
reviewed by grantee officials to avoid the purchase of unnecessary or
duplicative items.  Consideration should be given to consolidation or breaking
out to obtain a more economical purchase.  Where appropriate, an analysis shall
be made of lease versus purchase alternatives, and any other appropriate
analysis to determine which approach would be the most economical.  To foster
greater economy and efficiency, grantees are encouraged to enter into State and
local intergovernmental agreements for procurement or use of common goods and
services.
9.         Contracting with Small and Minority Firms, Women's Business
Enterprise and Labor Surplus Area Firms
a.         It is national policy to award a fair share of contracts to
small and minority business firms.  Accordingly, affirmative steps must be
taken to assure that small and minority businesses are utilized when possible
as sources of suppliers, equipment, construction and services. Affirmative
steps shall include the following:
1)         Including qualified small and minority businesses on
solicitation lists.
2)         Assuring that small and minority businesses are solicited
whenever they are potential sources.
3)         When economically feasible, dividing total requirements into
smaller tasks or quantities so as to permit maximum small and minority business
participation.
4)         Where the requirement permits, establishing delivery schedules
which will encourage participation by small and minority business.
5)         Using the services and assistance of the Small Business
Administration, the Office of Minority Business Enterprise of the Department of
Commerce and the Community Services Administration as required
ng requirements.
b.         The grantee shall have written selection procedures which
shall provide, as a minimum, the following procedural requirements:
1)         Solicitations of offers, whether by competitive sealed bids or
competitive negotiation shall:
a)         Incorporate a clear and accurate description of the technical
requirements for the material, product, or service to be procured. Such
description shall not, in competitive procurements, contain features which
unduly restrict competition.  The description may include a statement of the
qualitative nature of the material, product or service to be procured, and when
necessary, shall set forth those minimum essential characteristics and
standards to which it must conform if it is to satisfy its intended use.
Detailed product specifications should be avoided if at all possible.  When it
is impractical or uneconomical to make a clear and accurate description of the
technical requirements, a "brand name or equal" description may  be
used as a means to define the performance or other salient requirements of a
procurement.  The specific features of the named brand which must be met by
offerors shall be clearly stated.
b)         Clearly set forth all requirements which offerors must fulfill
and all other factors to be used in evaluating bids or proposals.
2)         Awards shall be made only to responsible contractors that
possess the potential ability to perform successfully under the terms and
conditions of a proposed procurement.  Consideration shall be given to such
matters as contractor integrity, compliance with public policy, record of past
performance, and financial and technical resources.
11.       Method Procurement.  Procurement under grants shall be made by
one of the following methods, as described herein:  (a) small purchase
procedures; (b) competitive sealed bids (formal advertising); (c) competitive
negotiation; (d) noncompetitive negotiation.
a
ters as contractor integrity, compliance with public policy, record of past
performance, and financial and technical resources.
11.       Method Procurement.  Procurement under grants shall be made by
one of the following methods, as described herein:  (a) small purchase
procedures; (b) competitive sealed bids (formal advertising); (c) competitive
negotiation; (d) noncompetitive negotiation.
a.         Small purchase procedures are those relatively simple and
informal procurement methods that are sound and appropriate for a procurement
of services, supplies or other property, costing in the aggregate not more than
$10,000.  Grantees shall comply with State or local small purchase dollar
limits under $10,000.  If small purchase procedures are used for a procurement
under a grant, price or rate quotations shall be obtained from an adequate
number of qualified sources.
b.         In competitive sealed bids (formal advertising), sealed bids
are publicly solicited and a firm-fixed-price contract (lump sum or unit price)
is awarded to the responsible bidder whose bid, conforming with all the
material terms and conditions of the invitation for bids, is lowest in price.
1)         In order for formal advertising to be feasible, appropriate
conditions must be present, including, as a minimum, the following:
a)         A complete, adequate and realistic specification or purchase
description is available.
b)         Two or more responsible suppliers are willing and able to
compete effectively for the grantee's business.
c)         The procurement lends itself to a firm-fixed-price contract,
and selection of the successful bidder can appropriately be made principally on
the basis of price.
2)         If formal advertising is used for a procurement under a grant
the following requirements shall apply:
a)         A sufficient time prior to the date set for opening of bids,
bids shall be solicited from an adequate number of known suppliers. In
addition, the invitation shall be publicly advertised
of the successful bidder can appropriately be made principally on
the basis of price.
2)         If formal advertising is used for a procurement under a grant
the following requirements shall apply:
a)         A sufficient time prior to the date set for opening of bids,
bids shall be solicited from an adequate number of known suppliers. In
addition, the invitation shall be publicly advertised.
b)         The invitation for bids, including specifications and
pertinent Attachments, shall clearly define the items or services needed in
order for the bidders to properly respond to the invitation.
c)         All bids shall be opened publicly at the time and place stated
in the invitation for bids.
d)         A firm-fixed-price contract award shall be made by written
notice to that responsible bidder whose bid, conforming to the invitation for
bids, is lowest.  Where specified in the bidding documents, factors such as
discounts, transportation costs and life cycle costs shall be considered in
determining which bid is lowest.  Payment discounts may only be used to
determine low bid when prior experience of the grantee indicates that such discounts
are generally taken.
e)         Any or all bids may be rejected when there are sound
documented business reasons in the best interest of the program.
c.         In competitive negotiation, proposals are requested from a
number of sources and the Request for Proposal is publicized, negotiations are
normally conducted with more than one of the sources submitting offers, and
either a fixed-price or cost-reimbursable type contract is awarded, as
appropriate.  Competitive negotiation may be used if conditions are not
appropriate for the use of formal advertising. If competitive negotiation is
used for a procurement under a grant, the following requirements shall apply:
1)         Proposals shall be solicited from an adequate number of
qualified sources to permit reasonable competition consistent with the nature
and requirements of the procurement
ble compensation.
d.         Noncompetitive negotiation is procurement through solicitation
of a proposal from only one source, or after solicitation of a number of
sources, competition is determined inadequate.  Noncompetitive negotiation may
be used when the award of a contract is unfeasible under small purchase,
competitive bidding (formal advertising) or competitive negotiation
procedures.  Circumstances under which a contract may be awarded by
noncompetitive negotiation are limited to the following:
1)         The item is available only from a single source;
2)         Public exigency or emergency when the urgency for the
requirement will not permit a delay incident to competitive solicitation;
3)         The Federal grantor agency authorizes noncompetitive
negotiation; or
4)         After solicitation of a number of sources, competition is
determined inadequate.
e.         Additional innovative procurement methods may be used by
grantees with the approval of the grantor agency.  A copy of such approval
shall be sent to the OFPP.
12.       Contract Pricing.  The cost plus a percentage of cost and
percentage of construction cost method of contracting shall not be used.
Grantees shall perform some form of cost or price analysis in connection with
every procurement action including contract modifications.  Costs or prices
based on estimated costs for contracts under grants shall be allowed only to
the extent that costs incurred or cost estimates included in negotiated prices
are consistent with Federal cost principles.
13.       Grantee Procurement Records.  Grantees shall maintain records
sufficient to detail the significant history of a procurement.  These records
shall include, but are not necessarily limited to information pertinent to the
following:  rationale for the method of procurement, selection of contract
type, contractor selection or rejection, and the basis for the cost or price.
14.       Contract Provision
tee Procurement Records.  Grantees shall maintain records
sufficient to detail the significant history of a procurement.  These records
shall include, but are not necessarily limited to information pertinent to the
following:  rationale for the method of procurement, selection of contract
type, contractor selection or rejection, and the basis for the cost or price.
14.       Contract Provision.  In addition to provisions defining a sound
and complete procurement contract, any recipient of Federal grant funds shall
include the following contract provisions or conditions in all procurement
contracts and subcontracts as required by the provision, Federal law or the
grantor agency.
a.         Contracts other than small purchases shall contain provisions
or conditions which will allow for administrative, contractual, or legal
remedies in instances where contractors violate or breach contract terms, and
provide for such sanctions and penalties as may be appropriate.
b.         All contracts in excess of $10,000 shall contain suitable
provisions for termination by the grantee including the manner by which it will
be effected and the basis for settlement.  In addition, such contracts shall
describe conditions under which the contract may be terminated for default as
well as conditions where the contract may be terminated because of
circumstances beyond the control of the contractor.
c.         All contracts awarded in excess of $10,000 by grantees and
their contractors or subgrantees shall contain a provision requiring compliance
with Executive Order 11246, entitled "Equal Employment Opportunity,"
as amended by Executive Order 11375, and as supplemented in Department of Labor
regulations (41 CFR Part 60).
d.         All contracts and subgrants for construction or repair shall
include a provision for compliance with the Copeland "Anti-Kickback"
Act (18 U.S.C. 874) as supplemented in Department of Labor regulations (29 CFR,
Part 3)
notice of grantor agency
requirements and regulations pertaining to reporting and patent rights under
any contract involving research, developmental, experimental or demonstration
work with respect to any discovery or invention which arises or is developed in
the course of or under such contract, and of grantor agency requirements and
regulations pertaining to copyrights and rights in data.
h.         All negotiated contracts (except those awarded by small
purchase procedures) awarded by grantees shall include a provision to the
effect that the grantee, the Federal grantor agency, the Comptroller General of
the United States, or any of their duly authorized representatives, shall have
access to any books, documents, papers, and records of the contractor which are
directly pertinent to that specific contract, for the purpose of making audit,
examination, excerpts, and transcriptions.
Grantees shall require contractors to maintain all required
records for three years after grantees make final payments and all other
pending matters are closed.
i.          Contracts, subcontracts, and subgrants of amounts in excess
of $100,000 shall contain a provision which requires compliance with all
applicable standards, orders, or requirements issued under Section 306 of the
Clean Air Act (42 U.S.C. 1857(h)), Section 508 of the Clean Water Act (33
U.S.C. 1368), Executive Order 11738, and Environmental Protectional Agency
(USEPA) regulations (40 CFR, Part 15), which prohibit the use under non-exempt
Federal contracts, grants or loans of facilities included on the EPA List of
Violating Facilities.  The provision shall require reporting of violations to
the grantor agency and to the USEPA Assistant Administrator for Enforcement
(EN-329).
j.          Contracts shall recognize mandatory standards and policies
relating to energy efficiency which are contained in the State energy
conservation plan issued in compliance with the Energy Policy and Conservation
Act (P.L. 94-163)
ss frequently
than every two years.
9.         If the auditor becomes aware of irregularities in the
recipient organization, the auditor shall promptly notify the cognizant agency
and recipient management officials above the level of involvement.
Irregularities include such matters as conflicts of interest, falsification of
records or reports, and misappropriation of funds or other assets.
10.       The audit report shall include:
a.         Financial statements, including footnotes, of the recipient
organization.
b.         The auditors' comments on the financial statements which
should:
1)         Identify the statements examined, and the period covered.
2)         Identify the various programs under which the organization
received Federal funds, and the amount of the awards received.
3)         State that the audit was done in accordance with the standards
in paragraph 5.
4)         Express an opinion as to whether the financial statements are
fairly presented in accordance with generally accepted accounting principles.
If an unqualified opinion cannot be expressed, state the nature of the
qualification.
c.         The auditors' comments on compliance and internal control
should:
1)         Include comments on weaknesses in and noncompliance with the
system of internal control, separately identifying material weaknesses.
2)         Identify the nature and impact of any noted instances of
noncompliance with the terms of agreements and those provisions of Federal law
or regulations that could have a material effect on the financial statements
and reports.
3)         Contain an expression of positive assurance with respect to
compliance with requirements for tested items, and negative assurance for
untested items.
d.         Comments on the accuracy and completeness of financial reports
and claims for advances or reimbursement of Federal agencies.
e.         Comments on the accuracy and completeness of financial reports
and claims for advances or reimbursement to Federal agencies.
11
itive assurance with respect to
compliance with requirements for tested items, and negative assurance for
untested items.
d.         Comments on the accuracy and completeness of financial reports
and claims for advances or reimbursement of Federal agencies.
e.         Comments on the accuracy and completeness of financial reports
and claims for advances or reimbursement to Federal agencies.
11.       Work papers and reports shall be retained for a minimum of
three years from the date of the audit report unless the auditor is notified in
writing by the cognizant agency of the need to extend the retention period.
The audit workpapers shall be made available upon request to the cognizant
agency or its designees and the General Accounting Office or its designees.
12.       The Office of Management and Budget will work with Federal
agencies and State and local governments to assure that recipient audits are
made in accordance with the standards set forth in paragraph 5.
13.       The Office of Management and Budget will designate cognizant
agencies for major recipient organizations.
14.       The cognizant agency shall have the following
responsibilities:
a.         Obtain or make quality assessment reviews of work of
non-Federal audit organizations, and provide the results to other interested
audit agencies.  (If a non-Federal audit organization is responsible for audits
of recipients that have different cognizant audit agencies, a single quality
assessment review should be arranged.)
b.         Assure that all audit reports of recipients that affect
federally assisted programs are received, reviewed, and distributed to
appropriate Federal audit officials.  These officials will be responsible for
distributing audit reports to their program officials.
c.         Whenever significant inadequacies in an audit are disclosed,
the recipient organization will be advised and the auditor will be called upon
to take corrective action

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Source: Frix Law Library, https://www.frixlaw.com/law-library/statutes/STATE_IL_IAC_T47_P1_S1_APPENDIX. Check the current official text before relying on it. Not legal advice.