Memorandum 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

Summary

Memorandum M-20-17 of the Office of Management and Budget, dated March 19, 2020, from Margaret Weichert, extends the administrative relief of M-20-11 to recipients of federal financial assistance affected by the loss of operational capacity and increased costs due to the COVID-19 crisis. Its Appendix A lets awarding agencies relax SAM registration, publish funding notices for less than thirty (30) days, extend awards active as of March 31, 2020 at no cost for up to twelve (12) months, keep charging salaries and benefits to active awards, and allow recipients to charge cancellation costs. Agencies may let grantees delay financial and performance reports up to three (3) months, and recipients with fiscal year-ends through June 30, 2020 may delay their Single Audit by six (6) months. The exceptions are time limited and are to be reassessed within 90 days.

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EXECUTIVE OFFICE OF THE PRESIDENT
OFFICE OF MANAGEMENT AND BUDGET
WASHINGTON, D.C. 20503

DEPUTY DIRECTOR
FOR MANAGEMENT

March 19, 2020

M-20-17

MEMORANDUM TO THE HEADS OF EXECUTIVE DEPARTMENTS AND AGENCIES

FROM: Margaret Weichert
Deputy Director of Manageme

SUBJECT: Administrative Relief for Recipients and Applicants of Federal Financial
Assistance Directly Impacted by the Novel Coronavirus (COVID-19) due to Loss
of Operations

On March 9, 2020, OMB issued M-20-11, "Administrative Relieffor Recipients and
Applicants of Federal Financial Assistance Directly impacted by the Novel Coronavirus
(COVID-19)," to provide agencies with additional flexibilities for grants assisting the response to
COVID-19. The scope of the M-20-11 was narrowly crafted to provide flexibility to grant
recipients performing essential research and services necessary to carry out the emergency
response related to COVID-19.

This memorandum provides similar administrative relieflisted in M-20-11 to an
expanded scope of recipients affected by the loss of operational capacity and increased costs due
to the COVID-19 crisis. Many of the operational impacts and costs are unknowable at this point,
as they will depend on the spread of the coronavirus and response dictated by public health
needs. This memorandum provides short term relief for administrative, financial management,
and audit requirements under 2 CFR Part 200, Uniform Administrative Requirements, Cost
principles and Audit Requirements for Federal Awards, without compromising Federal financial
assistance accountability requirements. As program managers are considering administrative
relief, they should be prudent in their stewardship of Federal resources which includes giving
consideration to potential offsets-e.g. reduction in training and travel. In addition, the
flexibilities provided within this memorandum, agencies are reminded of their existing flexibility
to issue exceptions on a case-by-case basis in accordance with 2 CFR § 200.102, Exceptions. M-
20-11 shall continue to apply, and Appendix A describes the exceptions granted under this
memorandum to recipients affected by the loss of operational capacity. These exceptions are
time limited and will be reassessed by OMB within 90 days of this Memo.

Questions regarding the above administrative relief provisions should be directed to
Office of Federal Financial Management Grant link at GrantsTeam@omb.eop.gov. OMB will
continue to provide updates and additional information as the situation unfolds. For the latest
information, sign up for the Grants Community of Practice by clicking at:
https://www.performance.gov/CAP/grants/
Appendix A - Administrative Relief Exceptions for COVID-19 Crisis

Federal awarding agencies are authorized to take the following actions, as they deem
appropriate and to the extent permitted by law, with respect to the administrative provisions that
apply to recipients grantees affected by the COVID-19 (for both recipients with COVID-19
related grants and other types of Federal grants). Awarding agencies are required to maintain
records on the level of particular exceptions provided to recipients. For items 6 and 7, awarding
agencies must require recipients to maintain appropriate records and documentation to support
the charges against the Federal awards.

1. Flexibility with SAM registration. (2 CFR § 200.205)

Awarding agencies can relax the requirement for active System for Award Management (SAM)
registration at time of application in order to expeditiously issue funding. At the time of award,
the requirements of 2 CFR § 200.205, Federal awarding agency review of risk posed by
applicants, continue to apply. Current registrants in SAM with active registrations expiring
before May 16, 2020 will be afforded a one-time extension of 60 days.

2. Flexibility with application deadlines. (2 CFR § 200.202)

Awarding agencies may provide flexibility with regard to the submission of competing
applications in response to specific announcements, as well as unsolicited applications. As
appropriate, agencies should list specific guidance on their websites and/or provide a point of
contact for an agency program official.

3. Waiver for Notice of Funding Opportunities (NOFOs) Publication. (2 CFR § 200.203)

For competitive grants and cooperative agreements, awarding agencies can publish emergency
Notice of Funding Opportunities (NOFOs) for less than thirty (30) days without separately
justifying shortening the tiineframe for each NOFO. Awarding agencies would still be required
to document and track NOFOs published for less than thirty (30) days under this emergency
waiver.

4. No-cost extensions on expiring awards. (2 CFR § 200.308)

To the extent permitted by law, awarding agencies may extend awards which were active as of
March 31, 2020 and scheduled to expire prior or up to December 31, 2020, automatically at no
cost for a period of up to twelve (12) months. This will allow time for recipient assessments, the
resumption of many individual projects, and a report on program progress and financial status to
agency staff. Project-specific financial and performance reports will be due 90 days following
the end date of the extension. Awarding agencies will examine the need to extend other project
reporting as the need arises.

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5. Abbreviated non-competitive continuation requests. (2 CFR § 200.308)

For continuation requests scheduled to come in from April 1, 2020 to December 31, 2020, from
projects with planned future support, awarding agencies may accept a brief statement from
recipients to verify that they are in a position to: 1) resume or restore their project activities; and
2) accept a planned continuation award. Awarding agencies should post any specific instructions
on their website . Awarding agencies will examine the need to extend this approach on
subsequent continuation award start dates as recipients have an opportunity to assess the
situation.

6. Allowability of salaries and other project activities. (2 CFR § 200.403 , 2 CFR § 200.404,
2 CFR § 200.405)

Awarding agencies may allow recipients to continue to charge salaries and benefits to currently
active Federal awards consistent with the recipients' policy of paying salaries (under unexpected
or extraordinary circumstances) from all funding sources, Federal and non-Federal. Awarding
agencies may allow other costs to be charged to Federal awards necessary to resume activities
supported by the award, consistent with applicable Federal cost principles and the benefit to the
project. Awarding agencies may also evaluate the grantee's ability to resume the project activity
in the future and the appropriateness of future funding, as done under normal circumstances
based on subsequent progress reports and other communications with the grantee. A warding
agencies must require recipients to maintain appropriate records and cost documentation as
required by 2 CFR § 200.302 - Financial management and 2 CFR § 200.333 - Retention
requirement of records to substantiate the charging of any salaries and other project activities
costs related to interruption of operations or services.

7. Allowability of Costs not Normally Chargeable to Awards. (2 CFR § 200.403, 2 CFR §
200.404, 2 CFR § 200.405)

A warding agencies may allow recipients who incur 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, to charge
these costs to their award without regard to 2 CFR § 200.403, Factors affecting allowability of
costs, 2 CFR § 200.404, Reasonable costs, and 2 CFR § 200.405, Allocable costs. Awarding
agencies may allow recipients to charge full cost of cancellation when the event, travel, or other
activities are conducted under the auspices of the grant. Awarding agencies must advise
recipients that they should not assume additional funds will be available should the charging of
cancellation or other fees result in a shortage of funds to eventually carry out the event or travel.
A warding agencies must require recipients to maintain appropriate records and cost
documentation as required by 2 CFR § 200.302 - Financial management and 2 CFR § 200.333 -
Retention requirement of records, to substantiate the charging of any cancellation or other fees
related to interruption of operations or services. As appropriate, awarding agencies may list
additional guidance on specific types of costs on their websites and/or provide a point of contact
for an agency program official.

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8. Prior approval requirement waivers. (2 CPR § 200.407)

Awarding agencies are authorized to waive prior approval requirements as necessary to
effectively address the response. All costs charged to Federal awards must be consistent with
Federal cost policy guidelines and the terms of the award, except where specified in this
memorandum.

9. Exemption of certain procurement requirements. (2 CPR§ 200.319(b), 2 CPR§ 200.321)

Awarding agencies may waive the procurement requirements contained in 2 CPR§ 200.319(b)
regarding geographical preferences and 2 CPR§ 200.321 regarding contracting small and
minority businesses, women's business enterprises, and labor surplus area firms.

10. Extension of financial, performance, and other reporting. (2 CPR§ 200.327, 2 CPR§
200.328)

Awarding agencies may allow grantees to delay submission of financial, performance and other
reports up to three (3) months beyond the normal due date. If an agency allows such a delay,
grantees will continue to draw down Federal funds without the timely submission of these
reports. However, these reports must be submitted at the end of the postponed period. In
addition, awarding agencies may waive the requirement for recipients to notify the agency of
problems, delays or adverse conditions related to COVID-19 on a grant by grant basis (200 CPR
200.328(d)(l).

11. Extension of currently approved indirect cost rates. (2 CPR§ 200.414 (c))

Awarding agencies may 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. Agencies may approve grantee requests for an extension on the use of the current rates
for one additional year without submission of an indirect cost proposal. Agencies may also
approve grantee requests for an extension of the indirect cost rate proposal submission to finalize
the current rates and establish future rates.

12. Extension of closeout. (2 CPR§ 200.343)

Awarding agencies may 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. This delay in submitting closeout reports may not exceed one year after the award
expues.

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13. Extension of Single Audit submission. (2 CFR § 200.512)

Awarding agencies, in their capacity as cognizant or oversight agencies for audit, should allow
recipients and subrecipients that have not yet filed their single audits with the Federal Audit
Clearinghouse as of the date of the issuance of this memorandum that have fiscal year-ends
through June 30, 2020, to delay the completion and submission of the Single Audit reporting
package, as required under Subpart F of 2 CFR § 200.501 -Audit Requirements, to six (6)
months beyond the normal due date. No further action by awarding agencies is required to enact
this extension. This extension does not require individual recipients and subrecipients to seek
approval for the extension by the cognizant or oversight agency for audit; however, recipients
and subrecipients should maintain documentation of the reason for the delayed filing. Recipients
and subrecipients taking advantage of this extension would still qualify as a "low-risk auditee"
under the criteria of 2 CFR § 200.520 (a)- Criteria for a low-risk auditee.

To receive the latest information on grants, including COVID-19 update, sign up for the
Grants Community of Practice by clicking at: https: //www.performance.gov/CAP/grants/

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