Glossary

A

Acquisition Cost: Per 45 CFR §75.2, means the cost of the asset including the cost to ready the asset for its intended use. Acquisition cost for equipment, for example, means the net invoice price of the equipment, including the cost of any modifications, attachments, accessories, or auxiliary apparatus necessary to make it usable for the purpose for which it is acquired. Acquisition costs for software includes those development costs capitalized in accordance with generally accepted accounting principles (GAAP). Ancillary charges, such as taxes, duty, protective in transit insurance, freight, and installation may be included in or excluded from the acquisition cost in accordance with the non-federal entity's regular accounting practices.

Adjustable-rate mortgage (ARM): for purposes of 45 CFR §75.318 or when used in connection with an encumbrance request, is a type of mortgage in which the interest rate applied on the outstanding balance varies throughout the life of the loan. The initial interest rate is fixed for a period, after which is reset periodically, often every year or even monthly. ARM interest rate resets are based on a benchmark or index plus an additional spread, called an ARM margin. ACF considers this type of rate high-risk and must be avoided. Also called a variable rate or floating rate mortgage. (WT)

Administrative Requirements: those matters common to grants in general, such as financial management, kinds and frequency of reports, and retention of records. These are distinguished from programmatic requirements, which concern matters that can be treated only on a program-by-program or grant-by-grant basis, such as kinds of activities that can be supported by grants under a particular program. (WT)

Advance Payment: Per 45 CFR §75.2, a payment that a federal awarding agency or pass-through entity makes by any appropriate payment mechanism, including a predetermined payment schedule, before the non-federal entity disburses the funds for program purposes.

Allocation: Per 45 CFR §75.2, the process of assigning a cost, or a group of costs, to one or more cost objective(s), in reasonable proportion to the benefit provided or other equitable relationship. The process may entail assigning a cost(s) directly to a final cost objective or through one or more intermediate cost objectives.

Allocable Cost: A cost that is allocable to a particular cost objective (i.e., a specific function, grant project, service, department, or other activity) in accordance with the relative benefits received. A cost is allocable to a federal award where it is treated consistently with other costs incurred for the same purpose in like circumstances and (1) is incurred specifically for the award, (2) benefits both the award and other work and can be distributed in reasonable proportion to the benefits received, or (3) is necessary for the overall operation of the organization. (HHS GPS)

Allowable Cost: A cost incurred by a recipient that is: (1) reasonable for the performance of the award; (2) allocable; (3) in conformance with any limitations or exclusions set forth in the federal cost principles applicable to the organization incurring the cost or in the Notice of Award (NoA) as to the type or amount of cost; (4) consistent with regulations, policies, and procedures of the recipient that are applied uniformly to both federally supported and other activities of the organization; (5) accorded consistent treatment as a direct or indirect cost; (6) determined in accordance with generally accepted accounting principles; and (7) not included as a cost in any other federally supported award (unless specifically authorized by statute). (HHS GPS)

Alteration and Renovation (A&R): Generally considered work that changes the interior arrangements or other physical characteristics of an existing facility or installed equipment so that it can be used more effectively for its currently designed purpose or adapted to an alternative use to meet a programmatic requirement. A&R may involve: changes to interior dimensions, surfaces, or finishes; changes to the internal environment; changes to utility services (plumbing, electricity, gas, etc.); installation of fixed equipment (including casework, fume hoods, etc.); replacement, removal, or reconfiguration of walls, doors, frames, or windows in order to place equipment in a permanent location; making unfinished shell space suitable for purposes other than human or animal occupancy, such as storage; or, alterations to meet requirements for accessibility by individuals with physical disabilities. This type of work also may be referred to as improvements, conversion, rearrangements, reconversion, rehabilitation, remodeling, restoration, or modernization. It excludes construction; large-scale permanent improvements (major renovation); “routine” maintenance and repair; and costs categorized as equipment costs per the recipient’s accounting system. HHS characterizes A&R projects as “minor” or “major”, depending on the type of activity proposed, the cost of the project, and whether it meets or exceeds the major renovation threshold (if applicable). Note: there may be areas of overlap, e.g., a re-budgeting action that causes a minor A&R project to become a major A&R project, which is unallowable under ACF programs that do not have real property authority. Note: The terms A&R and renovation may be used interchangeably. For more information see 45 CFR §§75.308, 75.407, 75.436, 75.439, 75.462,, Applicable ACF Programs with Real Property Authority, and HHS GPS. See also glossary terms Maintenance, Maintenance and Repair Costs, Major Renovation, Major Renovation Threshold, Minor Renovation, Real Property, and Repair for more information.(WT) 

Amendments: Non-routine award actions that require special approval and do not automatically occur for every grant, such as: Budget Modifications (also includes change in Indirect Cost Rate), Carry Over Budget (COB), Change in Key Personnel, No Cost Extension (NCE), and Supplemental Award. (WT)

Amortization: For purposes of 45 CFR §75.318 or when used in connection with an encumbrance request, is the process of paying off the amount (principal and interest) with regular payments made over time per the loan terms. (WT)

Arm’s-length: For property purposes, this term means an unrelated third party. Under a lease agreement it is an arrangement with an unrelated third party and follows the general requirements under 45 CFR §75.465(a). (WT)

Applicable Credit:  Those receipts that offset or reduce direct or indirect costs. Typical examples of such transactions include purchase discounts, rebates, or allowances; recoveries or indemnities on losses; insurance refunds; and adjustments of overpayments or erroneous charges. (See 45 CFR §75.406 and HHS GPS)

Application: A request for financial support of a project, program, or activity submitted to ACF on specified forms and in accordance with instructions provided by the awarding agency. (HHS GPS)

Appropriation: The process by which Congress designates and approves spending for a specific purpose (e.g., a project or program). Most government spending is determined through appropriation bills each year. These bills must be passed by Congress and signed by the President. When an appropriation is not passed by Congress before the beginning of the fiscal year, a “continuing resolution” (often referred to as a “CR”) may be enacted to avoid a government shutdown. A CR is a law that provides stopgap funding for agencies until their regular appropriations are passed. (WT)

Appropriation Act: The statute that provides the authority for federal agencies to incur obligations to and make payments out of the U.S. Treasury for specified purposes. (WT)

Approved Budget: The financial expenditure plan for a federally supported project, program, or activity, including revisions approved by the awarding office and permissible revisions made by the recipient. The approved budget consists of federal award (grant) funds and, if required by the terms and conditions of the award, non-federal participation in the form of matching or cost sharing. Expenditures under an approved budget that consists of both federal and non-federal shares are deemed to be borne by the recipient in the same proportion as the percentage of federal/non-federal participation in the overall budget. (HHS GPS)

Assigned: For property purposes described in 45 CFR §75.318, means in conveyance, to make or set over to another; to transfer; as to assign property, or some interest therein. (WT)

Assignment of rents: For property purposes described in 45 CFR §75.318 or when used in connection with an encumbrance request, means a clause that gives the lender direct rights to rent payments in the event of default. Rental for ACF recipients is unlikely; however, per 45 CFR §75.2, rental of real property would be considered program income and must comply with the program income requirements at 45 CFR §75.307. Provision may be acceptable, if it is clear the provision applies only as Lender’s remedy in the event of default. (WT)

Assistance Listings: Per 2 CFR §200.1, means refers to the publicly available listing of Federal assistance programs managed  and administered by the General Services Administration, formerly known as the Catalog of Federal Domestic Assistance (CFDA). Assistance listings are available at SAM.gov .  

Assistance Listing Numbers: Per 2 CFR §200.1, means the number assigned to a federal program, formerly known as the CFDA Number.

Assurance: A written statement by an applicant, normally included with the application, indicating that it will abide by a particular requirement if a grant is awarded. (HHS GPS)

Audit Finding: Per 45 CFR §75.2, means a deficiency which the auditor is required by 45 CFR §75.516(a) to report in the schedule of findings and questioned costs.

Audit Resolution: The process of resolving audit findings, including those related to management and systems deficiencies and monetary findings (i.e., questioned costs). (HHS GPS)

Auditee: Per 45 CFR §75.2, means any non-federal entity that expends federal awards which must be audited under 45 CFR Part 75, Subpart F-Auditors.

Auditor: Per 45 CFR §75.2, means an auditor who is a public accountant, or a federal, state, local government, or Indian Tribe audit organization, which meets the general standards specified for external auditors in Generally Accepted Government Auditing Standards (GAGAS). The term auditor does not include internal auditors of nonprofit organizations.

Authorized Organization Representative (AOR): The individual(s), named by the applicant/recipient organization, who is authorized to act for the applicant/recipient and to assume the obligations imposed by the federal laws, regulations, requirements, and conditions that apply to grant applications or awards. Also known as Authorized Official. (WT)

Award: The document that provides ACF federal funds to a recipient to carry out an approved program or project based on an approved application or progress report. (HHS GPS)

Award Amount: The amount that the federal government has promised to pay (obligated) a recipient, because it has signed a contract, awarded a grant, etc. (WT)

Award ID: A unique identification number for each individual award. (WT)

Awardee: See Non-Federal Entity.

Awarding Agency: With respect to a federal award, the federal agency (see federal awarding agency), and with respect to a subaward, the party that awarded the subaward. (WT)

Awarding Office: The ACF organizational component responsible for the business management and non-programmatic aspects of the award and administration of the award. For ACF, this is the Office of Grants Management (OGM). (HHS GPS)

B

Balloon mortgage: For purposes of 45 CFR §75.318 or when used in connection with an encumbrance request, is a debt instrument that does not amortize in equal monthly payments over the loan term. The borrower typically makes lower monthly payments over a set period (usually short-term) and at the end of the term, the entire remaining loan balance is due at once. These types of loans are usually short-term, and only a portion of the loan’s principal balance is amortized over the term. ACF will not consider balloon mortgages. (WT)

Balloon payment: For purposes of 45 CFR §75.318 or when used in connection with an encumbrance request, means an amount, usually large, agreed upon by the parties and due at the end of a mortgage, commercial loan, note, or other amortized loan. The balloon payment is not amortized over the life of the loan, and the remaining balance is the final repayment to the lender. ACF will not consider a loan with a balloon payment. (WT)

Block Grant: Block grants are primarily awarded to state and local governments in accordance with a statutory formula for broadly defined purposes — for example, social services or community development. (WT)

Budget: Per 45 CFR §75.2, means the financial plan for the project or program that the federal awarding agency or pass-through entity approves during the federal award process or in subsequent amendments to the federal award. It may include the federal and non-federal share or only the federal share, as determined by the federal awarding agency or pass-through entity.

Budget Narrative: A description or justification of costs by line item or budget category. The narrative outlines how costs are calculated, which includes the necessity, reasonableness, and allocation of the proposed costs. The Budget Narrative should include all individual line items found in the budget. The Budget Narrative should be separate from the line-item budget and should be separated by year. (WT)

Budget Period: Per 2 CFR §200.1, means the time interval (usually 12 months) from the start date of a funded portion of an award to the end date of that funded portion during which recipients are authorized to expend the funds awarded. 

Bundled loan: For purposes of 45 CFR §75.318 or when used in connection with an encumbrance request, occurs when a recipient seeks to consolidate several separate loans into a single loan secured by multiple properties (with different parcel numbers). ACF will not consider bundled loans. (WT)

C

Call option provision: For property purposes described in 45 CFR §75.318 or when used in connection with an encumbrance request, gives the Mortgagor/Lender the right to demand early repayment of the loan. This is a high-risk provision for ACF and the recipient.  It is advised that it be stricken or waived from the debt instrument. (WT)

Capital Assets: As defined by 45 CFR §75.2, means tangible or intangible assets used in operations having a useful life of more than one year which are capitalized in accordance with Generally Accepted Accounting Principles (GAAP). Capital assets include:

1. Land, buildings (facilities), equipment, and intellectual property (including software) whether acquired by purchase, construction, manufacture, lease-purchase, exchange, or through capital leases; and
2. Additions, improvements, modifications, replacements, rearrangements, reinstallations, renovations, or alterations to capital assets that materially increase their value or useful life (not ordinary repairs and maintenance).

Capital Expenditures: As defined by 45 CFR §75.2, means expenditures to acquire capital assets or expenditures to make additions, improvements, modifications, replacements, rearrangements, reinstallations, renovations, or alterations to capital assets that materially increase their value or useful life. For more information see 45 CFR §§75.308, 75.436, 75.439, 75.407, ACF Property Guidance, generally accepted accounting principles (GAAP), HHS GPS, and glossary terms Construction, Major Renovation and Major Renovation Threshold, and Real Property.

Carryover of Budget (COB): Unobligated federal funds remaining at the end of a budget period that may be carried forward into the next budget period to complete activities that were not completed in the budget period to which funds were originally awarded. Prior approval is generally required to carryover funds from one budget period to another. (HHS GPS)

Cash out loan: for purposes of 45 CFR §75.318 or when used in connection with an encumbrance request, is a debt instrument which includes additional funds above the amount needed to pay, for example, to purchase a property. These additional funds are then available for the recipient to be used as cash.  A cash-out loan may be warranted in limited circumstances, such as when the cash is needed for allowable and approvable repairs to the real property. ACF will not consider a cash out loan that includes purposes outside of the scope of allowable and approved real property expenses or if the recipient is not in good financial standing. (WT)

Central Service Cost Allocation Plan: Per 45 CFR §75.2, means documentation identifying, accumulating, and allocating or developing billing rates based on the allowable costs of services provided by a state, local government, or Indian tribe on a centralized basis to its departments and agencies. The costs of these services may be allocated or billed to users.

Change in Scope:  An activity whereby the objectives identified in the approved grant application are significantly changed by the recipient after award. Prior approval is required for a change in scope to be allowable under an award. (WT)

Change of Recipient: A process in which the legal and administrative responsibility for a grant-supported project, program, or activity is transferred from one legal entity to another before the end of the period of performance. This action also may be termed “transfer of a grant.” (HHS GPS)

Chief Grants Management Officer (CGMO): As the principal Grants Management Officer (GMO) within an awarding office, the CGMO is responsible for the awarding office’s implementation and adherence to grants policy and regulatory requirements. The CGMO provides grants staff under his/her leadership with the authority to sign and issue Notice of Awards (NoA). (WT)

Claim: Per 45 CFR §75.2 and depending on the context, can mean either:

1. A written demand or written assertion by one of the parties to a federal award seeking as a matter of right:
   • The payment of money in a sum certain.
   • The adjustment or interpretation of the terms and conditions of the federal award.
   • Other relief arising under or relating to a federal award.
2. A request for payment that is not in dispute when submitted.

Class of Federal Awards: Per 45 CFR §75.2, means a group of federal awards either awarded under a specific program or group of programs or to a specific type of non-federal entity or group of non-federal entities to which specific provisions or exceptions may apply.

Closeout: Per 45 CFR §75.2, means the process by which the federal awarding agency or pass-through entity determines that all applicable administrative actions and all required work of the federal award have been completed and takes actions as described in 2 CFR §200.344, unless program regulations say otherwise.

Cluster of Programs: Per 45 CFR §75.2, means a grouping of closely related programs that share common compliance requirements. The types of clusters of programs are research and development (R&D), student financial aid (SFA), and other clusters. “Other clusters” are as defined by OMB in the compliance supplement or as designated by a state for federal awards the state provides to its subrecipients that meet the definition of a cluster of programs. When designating an “other cluster,” a state must identify the federal awards included in the cluster and advise the subrecipients of compliance requirements applicable to the cluster, consistent with 45 CFR §75.352(a). A cluster of programs must be considered as one program for determining major programs, as described in 45 CFR §75.518, and, except for R&D as described in 45 CFR §75.501(c), whether a program-specific audit may be elected.

Cognizant Agency for Audit: Per 45 CFR §75.2, means the federal agency designated to carry out the responsibilities described in 45 CFR §75.513(a). The cognizant agency for audit is not necessarily the same as the cognizant agency for indirect costs. A list of cognizant agencies for audit may be found at the Federal Audit Clearinghouse.

Cognizant Agency for Indirect Costs: Per 45 CFR §75.2, means the federal agency responsible for reviewing, negotiating, and approving cost allocation plans or indirect cost proposals developed under this part on behalf of all federal agencies. The cognizant agency for indirect cost is not necessarily the same as the cognizant agency for audit. For assignments of cognizant agencies see the following:

1. For IHEs: Appendix III to 45 CFR part 75 C.11.
2. For nonprofit organizations: Appendix IV to 45 CFR part 75 C.2.a.
3. For state and local governments: Appendix V to 45 CFR part 75 F.1.
4. For Indian tribes: Appendix VII to 45 CFR part 75 D.1.

Commercial Organization: Per 45 CFR §75.2, means an organization, institution, corporation, or other legal entity, including, but not limited to, partnerships, sole proprietorships, and limited liability companies, that is organized or operated for the profit or benefit of its shareholders or other owners. The term includes small and large businesses and is used interchangeably with “for-profit organization.”

Completion Date: The date on which all work under an award is completed or the date in the Notice of Award (NoA) (as amended) on which federal sponsorship ends (i.e., the end of the period of performance). (HHS GPS)

Compliance supplement: Per 45 CFR §75.2, means Appendix XI to 45 CFR part 75 (previously known as the Circular A-133 Compliance Supplement).

Computing Devices: As defined by 45 CFR §75.2, means machines used to acquire, store, analyze, process, and publish data and other information electronically, including accessories (or “peripherals”) for printing, transmitting, and receiving, or storing electronic information. See definitions for Supplies and Information Technology Systems.

Construction: The creation of a building, structure, or facility, including the installation of equipment, site preparation, landscaping, associated roads, parking, environmental mitigation, and utilities, which provides space not previously available. It includes freestanding structures, additional wings or floors, enclosed courtyards or entryways, and any other means to provide usable space that did not previously exist (excluding temporary facilities). Only ACF grant programs that have real property authority are allowed, with prior approval, to use federal funds for this and/or related purpose. (WT)

Please note that, unlike the major renovation threshold, there is no threshold for construction.  When a program (such as the Office of Refugee Resettlement Unaccompanied Children (ORR-UC) program) does not have statutory authority to allow recipients to use Federal funds for construction and establish a federal interest in real property, any cost towards the construction may be disallowed if claimed to the Federal award. §§75.308, 75.407, 1305.2, 98.2, Applicable ACF Programs with Real Property Authority and Real Property Guidance.

Continuation Grant: An extension or renewal of existing program funding for one or more additional budget period(s) that would otherwise expire. Continuation grants are typically available to existing recipients of discretionary, multi-year projects; however, new applicants may be considered. (WT)

Contract: As defined by 45 CFR §75.2, a legal instrument by which a non-federal entity purchases property or services needed to carry out the project or program under a federal award. The term as used in this part does not include a legal instrument, even if the non-federal entity considers it a contract when the substance of the transaction meets the definition of a federal award or subaward.

Contractor: Per 45 CFR §75.2, means an entity that receives a contract as defined in Contract.

Contract Under a Grant: A written agreement between a recipient and a third party to acquire commercial goods or services. (HHS GPS)

Conventional loans: For the purposes of 45 CFR §75.318 or when used in connection with an encumbrance request, conventional loans are the most common type of lending for borrowers. Terms vary from short, intermediate, and long-term financing. Interest rates differ between each lender and depending on the overall credit risk of the entity applying for the loan. Payment schedules are typically monthly but can be quarterly, semi-annual, and annual if agreed upon by both parties. (WT)

Convey: For the purpose 45 CFR §75.318 means to transfer the right of ownership of a property from one party to another by a deed or similar instrument under a notarized seal. (WT)

Cooperative Agreement: Per 45 CFR §75.2, means a legal instrument of financial assistance between a federal awarding agency or pass-through entity and a non-federal entity that, consistent with 31 U.S.C. 6302-6305 :

1. Is used to enter a relationship of which the principal purpose is to transfer anything of value from the federal awarding agency or pass-through entity to the non-federal entity to carry out a public purpose authorized by a law of the United States (see 31 U.S.C. 6101(3)); and not to acquire property or services for the federal government or pass-through entity's direct benefit or use.
2. Is distinguished from a grant in that it provides for substantial involvement between the federal awarding agency or pass-through entity and the non-federal entity in carrying out the activity contemplated by the federal award.
3. The term does not include:
   • A cooperative research and development agreement as defined in 15 U.S.C. 3710a; or
   • An agreement that provides only:
     • Direct United States Government cash assistance to an individual.
     • A subsidy.
     • A loan.
     • A loan guarantee.
     • Insurance.

Cooperative audit resolution: Per 45 CFR §75.2, means the use of audit follow-up techniques which promote prompt corrective action by improving communication, fostering collaboration, promoting trust, and developing an understanding between the federal agency and the non-federal entity. This approach is based upon:

1. A strong commitment by federal agency and non-federal entity leadership to program integrity.
2. Federal agencies strengthening partnerships and working cooperatively with non-federal entities and their auditors; and non-federal entities and their auditors working cooperatively with federal agencies.
3. A focus on current conditions and corrective action going forward.
4. Federal agencies offering appropriate relief for past noncompliance when audits show prompt corrective action has occurred.
5. Federal agency leadership sending a clear message that continued failure to correct conditions identified by audits which are likely to cause improper payments, fraud, waste, or abuse is unacceptable and will result in sanctions.

Copyright: Considered the legal right on an intellectual property. See Intangible Property 45 CFR §§75.2, 75.322, and 75.448. (WT)

Corrective action: Per 45 CFR §75.2, means an action taken by an auditee that:

1. Corrects identified deficiencies.
2. Produces recommended improvements.
3. Demonstrates that audit findings are either invalid or do not warrant auditee action.

Cost Allocation Plan: Per 45 CFR §75.2, means a central service cost allocation plan or public assistance cost allocation plan.

Cost Analysis: The breakdown and verification of cost data proposed in an application budget, including evaluating specific elements of costs and examining them to determine the necessity, reasonableness, and allocability of the costs and their allowability pursuant to the applicable federal cost principles and other governing requirements. (HHS GPS)

Cost objective: Per 45 CFR §75.2, means a program, function, activity, award, organizational subdivision, contract, or work unit for which cost data are desired and for which provision is made to accumulate and measure the cost of processes, products, jobs, capital projects, etc. A cost objective may be a major function of the non-federal entity, a particular service or project, a federal award, or an indirect (Facilities & Administrative (F&A)) cost activity, as described in 45 CFR Part 75 Subpart E. See also Final Cost Objective and Intermediate Cost Objective.

Cost Sharing or Matching: (also known as non-federal share) As defined by 45 CFR §75.2, means the portion of project costs not paid by federal funds (unless otherwise authorized by federal statute). This may include the value of allowable third-party in-kind contributions, as well as expenditures by the recipient. See also 45 CFR §75.306. Costs used to satisfy matching or cost-sharing requirements are subject to the same policies governing allowability of other costs under the approved budget.  

For OHS recipients and subrecipients, according to 45 CFR 1303.44(c) “Non-federal match. Any non-federal match associated with facilities activities becomes part of the federal share of the facility.” See also glossary term Federal Interest. For all other ACF recipients and subrecipients there is no change to the standard definition.

Cross-collateralization: For property purposes as described in 45 CFR §75.318 or when used in connection with an encumbrance request, occurs when the collateral for one loan/property is also used as collateral for another loan/property. ACF will not consider debt instruments with a cross-collateralization. (WT)

Cross-default: For property purposes as described in 45 CFR §75.318 or when used in connection with an encumbrance request, occurs when a default under one loan agreement puts the borrower in default on another obligation under a separate loan agreement. Such provisions place the collateral under both loans at risk of foreclosure. ACF will not consider debt instruments with a cross-default. (WT)

D

Data Universal Numbering System (DUNS): The decommissioned nine-digit number established and assigned by Dun and Bradstreet, Inc. (D&B) to uniquely identify entities. This number is no longer used by the federal government. The Office of Management and Budget (OMB) directed federal agencies/systems to transition to the Unique Entity Identifier (UEI) on SAM.gov no later than April 4, 2022.

Debt instruments: For the purpose of 45 CFR §75.318 or when used in connection with an encumbrance request, means a document used to record a legal obligation of one party to pay a financial obligation to another in accordance with predetermined terms and conditions. (WT)

Deed restriction: For the purpose of 45 CFR §75.318, means a limit written on a deed to restrict control, occupancy, or property use. (WT)

Departmental Appeals Board (DAB): Per 45 CFR §75.2, means the independent office established in the Office of the Secretary with delegated authority from the Secretary to review and decide certain disputes between recipients of HHS funds and HHS awarding agencies under 45 CFR part 16  and to perform other review, adjudication, and mediation services as assigned.

Depreciation: the method for allocating the cost of fixed assets to periods benefiting from asset use. See 45 CFR §§75.436, 75.439, 75.443, 75.446, 75.465, program regulations, and non-federal entities accounting procedures. (WT)

Deviation: A change that adds, deletes, or modifies a requirement, whether the result is more restrictive or less restrictive, from HHS policy that is not based on statute or 45 CFR Part 75. As for real property in which there is a federal interest, it may not be conveyed, transferred, assigned, mortgaged, leased, or otherwise be encumbered or subordinated by a recipient unless a deviation is approved by the ACF Chief Grants Management Officer. (WT)

Direct Costs: Costs that can be specifically identified with a particular project or activity, or that can be directly assigned to such activities relatively easily with a high degree of accuracy. (HHS GPS)

Disallowed costs: as defined by 45 CFR §75.2, means those charges to a federal award that the federal awarding agency or pass-through entity determines to be unallowable, in accordance with the applicable federal statutes, regulations, or the terms and conditions of the federal award. See also 45 CFR §75.410 regarding the collection of unallowable costs.

Discretionary Award: As defined by 2 CFR §200.1, means an award in which the Federal awarding agency, in keeping with specific statutory authority that enables the agency to exercise judgment (“discretion”), selects the recipient and/or the amount of Federal funding awarded through a competitive process or based on merit of proposals. A discretionary award may be selected on a non-competitive basis, as appropriate. Also known as a discretionary grant or cooperative agreement.

Due on sale consent by lender: for purposes of 45 CFR §75.318 or when used in connection with an encumbrance request, is a standard clause. If a borrower sells part or the whole of a property without the lender’s prior approval, the lender can call the note immediately. ACF discourages borrowers from selling a property in which there is a federal interest without the expressed written approval by ACF and the respective lender. (WT)

E

Easement: In real estate means the right of one party to use or access real property that's owned by another for a limited and specific purpose. (WT)

Encroachment: A situation in real estate where, for example, a fixture such as a wall or fence intrudes, invades, or otherwise encroaches beyond a neighboring property line. (WT)

Encumbrance: A right to, interest in, or legal liability on real property. Examples include mortgages (or other finance arrangement), leases (including financed purchase), as well as liens, easements, encroachments, licenses, and deed restriction on the real property. (WT)

Entity Identification Number (EIN): A three-part coding scheme of 12 characters used in PMS to identify organizations and individuals. The first character identifies the recipient as an organization or an individual. The next 9 characters are the Internal Revenue Service tax number identification (TIN) for organizations or the social security number (SSN) for individuals. (WT)

Equipment: As defined by 2 CFR §200.1, means tangible personal property (including information technology systems) having a useful life of more than one year and a per-unit acquisition cost which equals or exceeds the lesser of the capitalization level established by the recipient or subrecipient for financial statement purposes, or $10,000. See definitions for Capital Assets, Computing Devices, General Purpose Equipment, Information Technology Systems, and Supplies. See Tangible Personal Property Guidance. 

Excess Property: Per 45 CFR §75.2, means property acquired in whole or in part under the control of any federal awarding agency that, as determined by the head of the awarding agency or his/her delegate, is no longer required for the agency's needs or the discharge of its responsibilities.

Expenditure Report: Per 45 CFR §75.2:

1. For non-construction awards, the SF-425 Federal Financial Report (FFR) (or other OMB-approved equivalent report).
2. For construction awards, the SF-271 “Outlay Report and Request for Reimbursement” (or other OMB-approved equivalent report).

Expenditures: Per 45 CFR §75.2, means charges made by a non-federal entity to a project or program for which a federal award was received.

1. The charges may be reported on a cash or accrual basis if the methodology is disclosed and is consistently applied.
2. For reports prepared on a cash basis, expenditures are the sum of:
   • Cash disbursements for direct charges for property and services.
   • The amount of indirect expense charged.
   • The value of third-party in-kind contributions applied.
   • The amount of cash advance payments and payments made to subrecipients.
3. For reports prepared on an accrual basis, expenditures are the sum of:
   • Cash disbursements for direct charges for property and services.
   • The amount of indirect expense incurred.
   • The value of third-party in-kind contributions applied.
   • The net increase or decrease in the amounts owed by the non-federal entity for:
     • Goods and other property received.
     • Services performed by employees, contractors, subrecipients, and other payees.
     • Programs for which no current services or performance are required such as annuities, insurance claims, or other benefit payments.

F

Facilities and Administrative Costs: See Indirect Costs.

Facility: Real property (e.g., building, structure) or modular unit for use by a recipient of an ACF program.  See 45 CFR §§75.2, 98.2 (CCDF), and 1305.2 (Head Start). (WT)

Federal Agency: Per 45 CFR §75.2, means an ’’agency'' as defined at 5 U.S.C. 551(1) and further clarified by 5 U.S.C. 552(f).

Federal Assistance: A federal program, service, or activity that directly aids organizations, individuals, or state/local/tribal governments. Sectors include education, health, public safety, and public welfare - to name a few. Financial assistance is distributed in many forms, including grants, loans, direct payments, or insurance. (WT)

Federal Audit Clearinghouse (FAC): Per 45 CFR §75.2, is the clearinghouse  designated by OMB as the repository of record where non-federal entities are required to transmit the reporting packages required by 45 CFR Part 75 Subpart F. The mailing address of the FAC is Federal Audit Clearinghouse, Bureau of the Census, 1201 E. 10th Street, Jeffersonville, IN 47132. Any future updates to the location of the FAC may be found at the OMB Web site.

Federal Award: According to 45 CFR §75.2 has the meaning, depending on the context, in either paragraph (1) or (2) of this definition:

1.  
   • The federal financial assistance that a non-federal entity receives directly from a federal awarding agency or indirectly from a pass-through entity, as described in §75.101; or
   • The cost-reimbursement contract under the Federal Acquisition Regulations that a non-federal entity receives directly from a federal awarding agency or indirectly from a pass-through entity, as described in §75.101.
2. The instrument setting forth the terms and conditions. The instrument is the grant agreement, cooperative agreement, other agreement for assistance covered in paragraph (2) of federal financial assistance, or the cost-reimbursement contract awarded under the Federal Acquisition Regulations.
3. Federal award does not include other contracts that a federal agency uses to buy goods or services from a contractor or a contract to operate federal government owned, contractor operated facilities.
4. See also definitions of federal financial assistance, grant agreement, and cooperative agreement.

Federal Award Date: As defined by 45 CFR §75.2, means the date when a federal award is signed by the authorized official of the federal awarding agency.

Federal Award Identification Number (FAIN): An identification code assigned to a specific financial assistance award by an agency for tracking purposes. The FAIN is tied to that award (and all future modifications to that award) throughout the award's life. Within an agency, FAINs are unique; a new award must be issued a new FAIN.  

Federal Awarding Agency: As defined by 45 CFR §75.2, the federal agency that provides a federal award directly to a non-federal entity. Alternative term: “Grant-Making Agency.”

Federal Financial Assistance: As defined by 45 CFR §75.2 means:

1. Assistance that non-federal entities receive or administer in the form of:
   • Grants.
   • Cooperative agreements.
   • Non-cash contributions or donations of property (including donated surplus property).
   • Direct appropriations.
   • Food commodities.
   • Other financial assistance.
2. For 45 CFR §75.202 and Subpart F — Audit Requirements, Federal Financial Assistance also includes assistance that non-federal entities receive or administer in the form of:
   • Loans.
   • Loan Guarantees.
   • Interest subsidies.
   • Insurance.
3. Federal financial assistance does not include amounts received as reimbursement for services rendered to individuals as described in 45CFR § 75.502(h) and (i).

Federal Financial Report (FFR): A standard federal form, SF-425, that shows the status of funds in non-construction programs and is used to monitor the financial progress of awards. The forms require information on federal and recipient shares and unobligated balances of federal funds.

Federal Funds Authorized: The total amount of federal funds obligated by the awarding office for use by the recipient. This amount may include any authorized carryover of unobligated funds from one of the two preceding budget periods. (HHS GPS)

Federal Interest: Per 45 CFR §75.2, means, for purposes of 45 CFR §75.343 or when used in connection with the acquisition or improvement of real property, equipment, or supplies under a federal award, the dollar amount that is the product of the:

1. Federal share of total project costs; and
2. Current fair market value of the property, improvements, or both, to the extent the costs of acquiring or improving the property were included as project costs. [Please note that current fair market value is based on an appraisal (no more than three (3) years old) conducted by an independent certified appraiser.] 

For OHS recipients and subrecipients, federal interest is defined as, per 45 CFR §1305.2 , a property right which secures the right of the federal awarding agency to recover the current fair market value of its percentage of participation in the cost of the facility in the event the facility is no longer used for Head Start purposes by the recipient or upon the disposition of the property. When a recipient uses Head Start funds to purchase, construct or renovate a facility, or make mortgage payments, it creates a federal interest. The federal interest includes any portion of the cost of purchase, construction, or renovation contributed by or for the entity, or a related donor organization, to satisfy a matching requirement.

Federal Share: Defined by 45 CFR §75.2, means the portion of total project costs that are paid by federal funds.

For OHS recipients and subrecipients, according to 45 CFR 1303.44(c) , “Non-federal match. Any non-federal match associated with facilities activities becomes part of the federal share of the facility.” For all other ACF award recipients and subrecipients there is no change to the standard definition.

Federally Recognized Indian Tribal Government: The governing body of an Indian tribe, band, nation, or other organized group or community, including any Native village as defined in Section 3 of the Alaska Native Claims Settlement Act of 1971 (43 U.S.C. 1601 et seq.), that is certified by the Secretary of the Interior as eligible for the special programs and services provided through the Bureau of Indian Affairs and the Indian Health Service.

Final Cost Objective: As defined by 45 CFR §75.2 is a cost objective which has allocated to it both direct and indirect costs and, in the non-federal entity's accumulation system, is one of the final accumulation points, such as a particular award, internal project, or other direct activity of a non-federal entity. See also Cost objective and Intermediate cost objective.

Financial Assistance: Transfer of money, property in lieu of money, or other direct assistance to an eligible recipient to support or stimulate a public purpose authorized by statute. (HHS GPS)

Financial Obligations: Defined by 2 CFR §200.1, when referencing a recipient's or subrecipient's use of funds under a federal award, means orders placed for property and services, contracts and subawards made, and similar transactions that require payment.

Fiscal Year (FY): The fiscal year is an accounting period that spans 12 months. For the federal government, it runs from October 1 to September 30. For example, Fiscal Year 2023 (FY 2023) starts October 1, 2022, and ends September 30, 2023. A fiscal year may be broken down into quarters. For the federal government, these quarters are: Q1: October — December; Q2: January — March; Q3: April — June; Q4: July — September. (WT)

Fixed amount awards: As defined by 45 CFR §75.2 means a type of grant agreement under which the federal awarding agency or pass-through entity provides a specific level of support without regard to actual costs incurred under the federal award. This type of federal award reduces some of the administrative burden and record-keeping requirements for both the non-federal entity and federal awarding agency or pass-through entity. Accountability is based primarily on performance and results. See 45 CFR §§ 75.201(b) and 75.353.

Fixed rate mortgage: For the purpose of 45 CFR §75.318 or when used in connection with an encumbrance request, a mortgage where the interest rate remains the same throughout the life of the loan. ACF considers a fixed rate the ideal type of arrangement. (WT)

Floating/ARM Mortgage: For the purpose of 45 CFR §75.318 or when used in connection with an encumbrance request, a type of mortgage where the interest rate applied on the outstanding balance varies throughout the life of the loan. The interest rate may initially be fixed for a period time (e.g., typically 5, 7, or 10 years), after which it resets periodically (e.g., every year or even monthly). These loans typically cost the borrower more in the long-term. ACF considers this type of mortgage high-risk and must be avoided. (WT)

Foreign Organization: As defined by 45 CFR §75.2 means an entity that is:

1. A public or private organization located in a country other than the United States and its territories that is subject to the laws of the country in which it is located, irrespective of the citizenship of project staff or place of performance.
2. A private nongovernmental organization located in a country other than the United States that solicits and receives cash contributions from the general public.
3. A charitable organization located in a country other than the United States that is nonprofit and tax exempt under the laws of its country of domicile and operation, and is not a university, college, accredited degree-granting institution of education, private foundation, hospital, organization engaged exclusively in research or scientific activities, church, synagogue, mosque, or other similar entities organized primarily for religious purposes.
4. An organization located in a country other than the United States not recognized as a Foreign Public Entity.

Foreign Public Entity: As defined by 45 CFR §75.2, means an entity that is:

1. A foreign government or foreign governmental entity.
2. A public international organization, which is an organization entitled to enjoy privileges, exemptions, and immunities as an international organization under the International Organizations Immunities Act (22 U.S.C. 288-288f).
3. An entity owned (in whole or in part) or controlled by a foreign government.
4. Any other entity consisting wholly or partially of one or more foreign governments or foreign governmental entities.

Formula Grant: Allocations of federal funding to states, territories, or local units of government determined by distribution formulas in the authorizing legislation and regulations. Formula grants typically fund activities of a continuing nature and may not be confined to a specific project. Common elements in formulas include population, proportion of population below the poverty line, and other demographic information. (WT)

Fully amortized loan: For the purpose of 45 CFR §75.318 or when used in connection with an encumbrance request, when payments are made according to the original schedule of the term loan and will be fully paid off by the end of the term. (WT)

Funding Agency: A Funding Agency pays for an award out of its budget. Typically, the Funding Agency is the same as the Awarding Agency. In some cases, one agency will administer an award (Awarding Agency) and another agency will pay for it (Funding Agency). (WT)

Funding Opportunity Number (FON): The number that a federal agency assigns to its grant announcement. (WT)

Funding Period: The period when federal funding is available for obligation by the recipient. (WT)

G

General Purpose Equipment: per 45 CFR §75.2, means equipment which is not limited to research, medical, scientific or other technical activities. Examples include office equipment and furnishings, modular offices, telephone networks, information technology equipment and systems, air conditioning equipment, reproduction and printing equipment, and motor vehicles. See glossary term Equipment.

Generally Accepted Accounting Principles (GAAP): Principles specified in accounting standards issued by the Government Accounting Standards Board  (GASB) and the Financial Accounting Standards Board  (FASB).

Generally Accepted Government Auditing Standards (GAGAS): Also known as the GAO Yellow Book . As defined by 45 CFR §75.2, means generally accepted government auditing standards issued by the Comptroller General of the United States, which are applicable to financial audits.

Grant: A financial assistance support mechanism providing money, property, or other direct assistance in lieu of money, or both, to an eligible entity to carry out an approved project or activity in support of a public purpose and not the direct benefit of the government. A grant is used whenever the awarding office anticipates no substantial programmatic involvement with the recipient during performance of the financially assisted activities. (HHS GPS)

Grant Agreement: As defined by 45 CFR §75.2, is a legal instrument of financial assistance between a federal awarding agency or pass-through entity and a non-federal entity that, consistent with 31 U.S.C. 6302, 6304: 

1. Is used to enter a relationship the principal purpose of which is to transfer anything of value from the federal awarding agency or pass-through entity to the non-federal entity to carry out a public purpose authorized by a law of the United States (see 31 U.S.C. 6101(3)); and not to acquire property or services for the federal awarding agency or pass-through entity's direct benefit or use. 
2. Is distinguished from a cooperative agreement in that it does not provide for substantial involvement between the federal awarding agency or pass-through entity and the non-federal entity in carrying out the activity contemplated by the federal award. 
3. Does not include an agreement that provides only: (i) Direct United States Government cash assistance to an individual; (ii) A subsidy; (iii) A loan; (iv) A loan guarantee; or (v) Insurance. 

Grantee: See Recipient

Grants Management Officer (GMO): The awarding agency official responsible for the business management aspects of grants and cooperative agreements, including review, negotiation, award, and administration, and for the interpretation of grants administration policies and provisions. GMOs are delegated the authority from the Chief GMO to obligate the awarding agency to the expenditure of funds and permit changes to approved projects on behalf of the awarding agency. (WT)

Grants Management Specialist (GMS): Awarding agency staff member who works under the direction of the GMO and is responsible for the day-to-day management of grants. Typically, the GMS is the primary contact to recipients for business and administrative matters pertinent to grant awards. (WT)

Grant-Supported Project or Activity: Those activities specified or described in an application or in a subsequent submission that are approved by an awarding office for funding, regardless of whether federal funding constitutes all or only a portion of the financial support necessary to carry them out. (HHS GPS)

H

HHS awarding agency: As defined by 45 CFR §75.2, means any organization component of HHS that is authorized to make and administer awards.

High Risk: The term used to describe a recipient who is at risk of financial failure or failure to perform based on a history of poor performance or poor business practices, financial instability, or inadequate management systems. (HHS GPS)

Historic property: Any prehistoric or historic district, site, building, structure, or object included in, or eligible for inclusion in, the National Register of Historic Places maintained by the Secretary of the Interior. This term includes artifacts, records, and remains that are related to and located within such properties. The term includes properties of traditional religious and cultural importance to an Indian tribe or Native Hawaiian organization and that meet the National Register criteria (Source: 36 CFR §800.16(I)(1) ). While recipients may consider historic buildings or land, it is generally not in their or ACFs best interest. The National Historical Preservation Act (NHPA) requirements are targeted for historical preservation, which may not align with program requirement needs and expectation. NHPA properties also require involvement from the U.S. DHHS and the State or Tribal Historic Preservation offices. (WT)

I

Improper payment: As defined by 45 CFR §75.2 means:

1. Any payment that should not have been made or that was made in an incorrect amount (including overpayments and underpayments) under statutory, contractual, administrative, or other legally applicable requirements.
2. Includes any payment to an ineligible party, any payment for an ineligible good or service, any duplicate payment, any payment for a good or service not received (except for such payments where authorized by law), any payment that does not account for credit for applicable discounts, and any payment where insufficient or lack of documentation prevents a reviewer from discerning whether a payment was proper.

In-kind Contributions: The value of non-cash contributions that directly benefit a grant-supported project or program and are provided by non-federal third parties without charge to the recipient, the sub-recipient, or a cost-type contractor under a grant or sub award. In-kind contributions may be in the form of real property, equipment, supplies or other expendable property, or goods and services directly benefiting and specifically identifiable to the project or program. See 45 CFR §75.306, Cost Sharing or matching. (WT)

Indian Tribe (or Federally Recognized Indian Tribe): As defined by 45 CFR §75.2, means any Indian tribe, band, nation, or other organized group or community, including any Alaska Native village or regional or village corporation as defined in or established pursuant to the Alaska Native Claims Settlement Act (43 U.S.C. Chapter 33), which is recognized as eligible for the special programs and services provided by the United States to Indians because of their status as Indians (25 U.S.C. 450b(e)). See annually published Bureau of Indian Affairs list of Indian Entities Recognized and Eligible to Receive Services .

Indirect Cost Rate: A mechanism for determining what proportions of indirect costs each program/project should bear. An Indirect Cost Rate represents the ratio between the total indirect costs and benefiting direct costs, after excluding and/or reclassifying unallowable costs, and extraordinary or distorting expenditures. The Indirect Cost Rate is negotiated between the organization and the cognizant federal agency. Indirect costs cannot be charged to the project without an Indirect Cost Rate agreement from the cognizant federal agency. (WT)

Indirect Cost Rate Agreement: a formal rate agreement signed by the agency negotiating the indirect cost rate, i.e., the HHS Program Support Center’s Cost Allocation Services (CAS) office, the National Institutes of Health’s Division of Financial Advisory Services (DFAS), or other cognizant federal agency office, and an authorized organizational representative of the recipient. (WT)

Indirect Cost Rate Proposal: As defined by 45 CFR §75.2, is documentation prepared by a non-federal entity to substantiate its request for the establishment of an indirect cost rate as described in appendix III through appendix VII, and appendix IX of 45 CFR Part 75.

Indirect Costs: Also called Facilities and Administration or F&A. Per 45 CFR §75.2, are costs incurred for a common or joint purpose benefitting more than one cost objective, and not readily assignable to the cost objectives specifically benefitted, without effort disproportionate to the results achieved. To facilitate equitable distribution of indirect expenses to the cost objectives served, it may be necessary to establish a number of pools of indirect (F&A) costs. Indirect (F&A) cost pools must be distributed to benefitted cost objectives on bases that will produce an equitable result in consideration of relative benefits derived.

Information Technology Systems: As defined by 45 CFR §75.2, means computing devices, ancillary equipment, software, firmware, and similar procedures, services (including support services), and related resources. See definitions for Computing Devices and Equipment.

Institutions of Higher Education (IHEs): Defined by 20 U.S.C. 1001 as an educational institution in any State that:

1. Admits as regular students only persons having a certificate of graduation from a school providing secondary education, or the recognized equivalent of such a certificate, or persons who meet the requirements of section 1091(d) of 20 U.S.C. 1001.
2. Is legally authorized within such State to provide a program of education beyond secondary education.
3. Provides an educational program for which the institution awards a bachelor's degree or provides not less than a 2-year program that is acceptable for full credit toward such a degree or awards a degree that is acceptable for admission to a graduate or professional degree program, subject to review and approval by the secretary.
4. Is a public or other nonprofit institution.
5. Is accredited by a nationally recognized accrediting agency or association, or if not so accredited, is an institution that has been granted pre-accreditation status by such an agency or association that has been recognized by the secretary for the granting of pre-accreditation status, and the Secretary has determined that there is satisfactory assurance that the institution will meet the accreditation standards of such an agency or association within a reasonable time.

Intangible Property: Per 45 CFR §75.2, means property having no physical existence, such as trademarks, copyrights, patents and patent applications and property, such as loans, notes and other debt instruments, lease agreements, stock, and other instruments of property ownership (whether the property is tangible or intangible).

Intellectual Property: A capital asset and consists of trademarks, copyrights, patents, including software. See 45 CFR §§75.2 and 75.322.

Interest rate swap: For property purposes per 45 CFR §75.318 or when used in connection with an encumbrance request, this is a provision used when one type of interest payment is substituted for another type for a specified principal loan amount.  Interest swaps usually involve exchanging a fixed interest rate for a floating rate, or vice versa, to reduce or increase exposure to fluctuations in interest rates or to obtain a marginally lower interest rate than would be possible without the swap.  Swaps are derivative contracts (most common are futures, options, forwards, and swaps that derive their value/price from underlying assets) and over-the-counter trades.  The most common type of interest rate swaps are called “vanilla” swaps.  Payments made by party A are based on a floating rate of interest using, for example, the London Inter Bank Offered Rate (LIBOR) or Securities Industry and Financial Markets Association (SIFMA) Municipal Swap Index. Whereas other payments made by party B are based on a fixed rate of interest using, for example, spread over U.S. Treasury bonds of similar maturity.  Swaps vary widely.  These loans typically cost the borrower more in the long-term. ACF considers this type of rate high-risk and must be avoided. (WT)

Intermediate cost objective: A cost objective that is used to accumulate indirect costs or service center costs that are subsequently allocated to one or more indirect cost pools or final cost objectives. See also Cost objective and Final cost objective. (WT)

Internal controls: As defined by 45 CFR §75.2, a process, implemented by a non-federal entity, designed to provide reasonable assurance regarding the achievement of objectives in the following categories:

1. Effectiveness and efficiency of operations.
2. Reliability of reporting for internal and external use.
3. Compliance with applicable laws and regulations.

K

Key Personnel: The PD/PI and other individuals who contribute to the programmatic development or execution of a project or program in a substantive, measurable way, whether they receive salaries or compensation under the grant. (HHS GPS)

L

Land Improvements: Capital expenditures. These may include, but are not limited to, installation of paved areas (e.g., parking lots, sidewalks, etc.), permanent fences, utility conduits, and similar improvements. (WT)

Less-Than-Arm’s-Length Leases: When one party of an agreement can control or substantially influence the actions of the other. See 45 CFR §75.465.  (WT)

A few examples include, but are not limited to:

1. Leases between divisions of the non-federal entity.
2. Leases between the non-federal entity under common control through common officers, directors, or members.
3. Leases between the non-federal entity and director, trustee, officer, or key personnel of the organization, or family members (blood or affinity) of these individuals, either directly or through other entities with similar arrangements in which they hold a controlling interest.
4. Any arrangement under which the non-federal entity holds title to a property and enters a leasing arrangement for that property under a federal financial award.
5. Sale and leaseback arrangements under which property owned by a non-federal entity is sold to and leased back from another entity or individual.

Leveraged Resource: Any resource, other than the federal share and non-federal contribution, expressed as a dollar figure, acquired, or utilized during the project period that supports the project. Leveraged Resources may include natural, financial, personnel, and physical resources provided to assist in the successful completion of the project. (WT)

Line-Item Budget: A budget that lists the individual costs of all budgeted items, such as personnel participating in the project, fringe benefits, travel, equipment, and supplies. A Line-Item Budget should always be separate from the budget narrative and identify each budget period separately. (WT)

Loan: As defined by 45 CFR §75.2, means a federal loan or loan guarantee received or administered by a non-federal entity, except as used in the definition of program income.

1. The term “direct loan” means a disbursement of funds by the federal government to a non-federal borrower under a contract that requires the repayment of such funds with or without interest. The term includes the purchase of, or participation in, a loan made by another lender and financing arrangements that defer payment for more than 90 days, including the sale of a federal government asset on credit terms. The term does not include the acquisition of a federally guaranteed loan in satisfaction of default claims, or the price support loans of the Commodity Credit Corporation.
2. The term “direct loan obligation” means a binding agreement by a federal awarding agency to make a direct loan when specified conditions are fulfilled by the borrower.
3. The term “loan guarantee” means any federal government guarantee, insurance, or other pledge with respect to the payment of all or a part of the principal or interest on any debt obligation of a non-federal borrower to a non-federal lender, but does not include the insurance of deposits, shares, or other withdrawable accounts in financial institutions.
4. The term “loan guarantee commitment” means a binding agreement by a federal awarding agency to make a loan guarantee when specified conditions are fulfilled by the borrower, the lender, or any other party to the guaranteed agreement.

Local Government: As defined by 45 CFR §75.2, is a county, borough, municipality, city, town, township, parish, local public authority (including any public housing agency under the United States Housing Act of 1937), school district, special district, intra-state district, council of governments (whether or not incorporated as a nonprofit corporation under State law), any other agency or instrumentality of a multi-, regional, or intra-state or local government.

M

Maintenance and Repair Costs: Are not defined under the definitions contained in 45 CFR §75.2 like many other terms; however, it is identified as a selected item of cost under the cost principles (Subpart E — Cost Principles). According to the general provisions (45 CFR §75.420), this section applies principles in determining costs and are in addition to the basic consideration requirements (45 CFR 75.402 -75.411) such as allowable cost factors, reasonable costs, allocable costs, and prior written approval. These principles apply whether or not a particular item of costs is properly treated as direct or indirect (Facilities & Administration) cost. With that in mind, the maintenance and repair costs (45 CFR §75.452) requirement contains three principles:

1. Costs incurred for utilities, insurance*, security*, necessary maintenance, janitorial services*, repair, or upkeep of buildings and equipment (including federal property unless otherwise provided for) which neither add to the permanent value of the property nor appreciably prolong its intended life, but keep it in an efficient operating condition, are allowable.
2. Costs incurred for improvements which add to the permanent value of the buildings and equipment or appreciably prolong their intended life must be treated as capital expenditures (see 45 CFR §75.439).
3. These costs are only allowable to the extent not paid through rental or other agreements.

For more information, please see 45 CFR §§75.308, 75.407, 75.436, 75.439, 75.462,  ACF Property Guidance, generally accepted accounting principles (GAAP), and glossary terms Construction, Major Renovation, Major Renovation Threshold, and Real Property. (WT)

*Insurance, security, and services have additional separate administrative or cost principle requirements that must be considered too. Note: “routine” maintenance and repair costs are allowable as an indirect cost, HHS GPS.

Major Program: As defined by 45 CFR §75.2, means a federal program determined by the auditor to be a major program in accordance with 45 CFR §75.518 or a program identified as a major program by a federal awarding agency or pass-through entity in accordance with 45CFR §75.503(e).

Major Renovation (Alteration and Renovation): Generally considered a structural change (e.g., to the foundation, roof, floor, or exterior or load-bearing walls of a facility, or an extension to an existing facility) to achieve the following: increase the floor area; and/or change function and purpose of the facility. Only ACF programs that have real property authority are allowed, with prior approval, to use federal funds for this and/or related purposes. For additional information regarding major renovation, please see the Major Renovation Threshold, award terms and conditions, HHS GPS, Applicable ACF Programs with Real Property Authority, Real Property Guidance, and any program-specific guidance such as the OCC Program Instructions (e.g., CCDF-ACF-PI-2020-02 (PDF), ACF-OCC-CCDF-PI-2024-02). (WT)

For OHS recipients and subrecipients, as defined by 45 CFR §1305.2 : 

• Effective 10/21/2024: major renovation means any individual or collective group of renovation activities related to the same facility that has a cost equal to or exceeding $350,000 in Head Start funds. Renovation activities that are intended to occur concurrently or consecutively, or altogether address a specific part or feature of a facility, are considered a collective group of renovation activities. Unless included in a purchase application, minor renovations and repairs are excluded from major renovations. To maintain alignment with the National Defense Authorization Act (NDAA), the major renovation threshold will increase to account for any increases made to the simplified acquisition threshold beyond $350,000. Tribes that jointly apply to use both Tribal Child Care and Development Fund (CCDF) and Head Start funds toward major renovations may comply with the CCDF threshold for major renovation if it is higher.
• Prior to 10/21/2024: major renovation means any individual or collective renovation that has a cost equal to or exceeds $250,000 and excludes minor renovation and repair, except when they are included in a purchase application.

For OCC CCDF, as defined by 45 CFR §98.2 :

• Effective 4/30/2024: major renovation means any renovation that has a cost equal to or exceeding $350,000 in CCDF funds for child care centers and $50,000 in CCDF funds for family child care homes, which amount shall be adjusted annually for inflation and published on the Office of Child Care website. If renovation costs exceed these thresholds and do not include: (1) Structural changes to the foundation, roof, floor, exterior or load-bearing walls of a facility, or the extension of a facility to increase its floor area; or (2) Extensive alteration of a facility such as to significantly change its function and purpose for direct child care services, even if such renovation does not include any structural change; and improve the health, safety, and/or quality of child care, then it shall not be considered major renovation
• Prior to 4/30/2024: major renovation involves structural changes to the foundation, roof, floor, exterior or loadbearing walls of a facility, or the extension of a facility to increase its floor area. Major renovation also includes any extensive alteration of a facility such as to significantly change its function and purpose, even if such renovation does not include any structural change. Please note: Only as it relates to the Supplemental Appropriations for Disaster Relief Act of 2019 (Pub. L. 116-20) does the 45 CFR §98.2 major renovation definition apply to eligible States and Territories CCDF lead agencies.

Major Renovation Threshold: For the purpose of 45 CFR §75.318 (unless otherwise stated in federal statute, program regulations, and terms of an award) means the amount used to distinguish between minor and major “Alteration & Renovation” for the entire project period. This threshold applies to each land parcel, as described by the jurisdiction in which the property is located. Construction and purchase are excluded from this term, please see their respective terms for more information. (WT)

For OCC CCDF and OHS recipients and subrecipients see Major Renovation and Minor Renovation glossary terms.

For all other ACF programs (not identified above), unless otherwise stated in federal statute, program regulations, and the terms and conditions of the award, the major renovation threshold is:

1. Equal to or exceeding $250,000 for a single renovation project.
2. A budget revision for a renovation project in a budget period exceeding the lesser of $250,000 or 25% of the total approved budget (direct and indirect costs and both the federal and any non-federal share).
3. Cumulative costs for a renovation project exceeding the lesser of $250,000 or 25% of the total direct costs reasonably expected to be awarded in the period of performance.

Any cost exceeding the major renovation threshold may result in a disallowance unless the program has statutory authority and the recipient received approval from the authorized grants official. 

When a program (such as the ORR-UC program) does not have statutory authority allowing recipients to use federal funds for major renovations and establish a federal interest in real property, any cost equal to or exceeding the major renovation threshold may be disallowed. For example, a recipient with an award under a federal program may exceed the major renovation threshold if it undertakes alterations or repairs exceeding $250,000 on a single land parcel. As another example, if a recipient has multiple concurrent awards under a federal program, alterations and repairs occurring on a single land parcel that collectively exceed $250,000 across all awards (as opposed to per award) may be considered exceeding the major renovation threshold. As stated above, the threshold for non-OHS and non-OCC CCDF Tribal Agencies applies to individual land parcels and may relate to "cumulative costs for a renovation project." Further, in these examples, the use of federal funds equal to or exceeding the threshold may establish an unauthorized federal interest in the real property and result in a disallowance.

In general, to mitigate risks of disallowance alterations and repairs must be reviewed on a case-by-case basis and tracked carefully to ensure compliance with applicable regulations and policies.

Management Decision: As defined by 45 CFR §75.2, means the evaluation by the federal awarding agency or pass-through entity of the audit findings and corrective action plan and the issuance of a written decision to the auditee as to what corrective action is necessary.

Matching or Cost Sharing: The value of third-party in-kind contributions and the portion of the costs of a federally assisted project or program not borne by the federal government. Costs used to satisfy matching or cost-sharing requirements are subject to the same policies governing allowability as other costs under the approved budget. (HHS GPS)

Micro-purchase: Per 45 CFR §75.2, a purchase of supplies or services using simplified acquisition procedures, the aggregate amount of which does not exceed the micro-purchase threshold. Micro-purchase procedures comprise a subset of a non-federal entity's small purchase procedures. The non-federal entity uses such procedures to expedite the completion of its lowest-dollar small purchase transactions and minimize the associated administrative burden and cost. The micro-purchase threshold is set by the Federal Acquisition Regulation at 48 CFR Subpart 2.1 . 

Minor Renovation (A&R): Defined as improvements to real property, which do not meet the definition of major renovation and major renovation threshold. (WT) (HHS GPS)

Minor A&R considered a capital expenditure may be an allowable cost so long as it:

1. Complies with federal regulations (i.e., 45 CFR §§75.407, 75.439, 75.462) including the prior written approval requirements, and
2. Either follows the program-specific minor A&R definition or does not exceed the identified major renovation threshold.

Any cost exceeding the major renovation threshold may result in a disallowance unless the program has real property authority and the recipient received approval from the authorized grants official.

For OCC CCDF: as defined by Program Instruction (e.g., CCDF-ACF-PI-2020-02 (PDF), ACF-OCC-CCDF-PI-2024-02) minor renovation includes all renovation other than major renovation or construction.

Modified Total Direct Cost (MTDC): As defined by 2 CFR §200.1, means all direct salaries and wages, applicable fringe benefits, materials and supplies, services, travel, and up to the first $50,000 of each subaward (regardless of the period of performance of the subawards under the award). MTDC excludes equipment, capital expenditures, charges for patient care, rental costs, tuition remission, scholarships and fellowships, participant support costs, and the portion of each subaward in excess of $50,000. Other items may only be excluded when necessary to avoid a serious inequity in the distribution of indirect costs, and with the approval of the cognizant agency for indirect costs.

Modular Unit: A structure such as a trailer or modular unit, (usually prefabricated) made at another location and moved to a site for use by a recipient of an ACF program. It may be classified as equipment or real property. Categorization of the property depends on the determination of whether the unit is intended to be used as equipment or to be fixed to the land in such a way that it becomes a permanent structure. (WT)

Equipment intended to be “fixed” rather than “moveable”, must be classified as real property. See 45 CFR §75.2 for real property and equipment definitions, 45 CFR §98.2 , 45 CFR §1305.2 , HHS GPS, any program-specific guidance such as the OCC Program Instructions (e.g., CCDF-ACF-PI-2020-02 (PDF), ACF-OCC-CCDF-PI-2024-02), and the non-federal entities accounting procedures. Depending on the classification, please see the relevant reporting and disposition guidance.

Monitoring: A process in which a grant’s programmatic performance and business management performance are assessed by reviewing information gathered from various required reports, audits, site visits, and other sources. (HHS GPS)

Mortgage: For purposes of 45 CFR §75.318, or when used in connection with an encumbrance request, considered a debt instrument that the borrower is obligated to pay back with a predetermined set of payments. This document is an encumbrance, which requires prior approval and a deviation. Only ACF programs that have real property authority are allowed, with prior approval, to use federal funds for this and/or related purpose, including interest payments. See 45 CFR §75.308, 45 CFR §75.308(c)(1)(xi), 45 CFR §75.318(b), any program-specific guidance such as the OCC Program Instructions (e.g., CCDF-ACF-PI-2020-02 (PDF), ACF-OCC-CCDF-PI-2024-02), Applicable ACF Programs with Real Property Authority, and Real Property Guidance. (WT)

N

Non-Competing Continuation Award: An award made for additional funding/budget period within a previously approved project period through a non-competing process. (WT)

Non-Competing Extension: A limited period beyond the end of the period of performance, authorized by an awarding office or a recipient under an expanded authority, needed to complete project activities. (HHS GPS)

Non-Federal Entities: As defined by 45 CFR §75.2, is a state, local government, Indian tribe, institution of higher education (IHE), or nonprofit organization that carries out a federal award as a recipient or subrecipient.

Non-discretionary Award: As defined by 2 CFR §200.1 means an award (grant) made by the Federal awarding agency to specific recipients in accordance with statutory, eligibility and compliance requirements, such that in keeping with specific statutory authority the agency has no ability to exercise judgement (“discretion”). A non-discretionary award amount could be determined specifically or by formula. Also known as a mandatory grant. 

Non-Federal Funding Amount: For financial assistance, the amount of the award funded by non-federal source(s), in dollars. Program Income (as defined in 45 CFR §75.307) is not included until such time that Program Income is generated and credited to the agreement. (WT)

Non-Federal Share (NFS): The portion of allowable project costs not borne by the federal government. (HHS GPS)

Nonprofit Organization: As defined by 45 CFR §75.2, is any corporation, trust, association, cooperative, or other organization, not including IHEs, that:

1. Is operated primarily for scientific, educational, service, charitable, or similar purposes in the public interest.
2. Is not organized primarily for profit.
3. Uses net proceeds to maintain, improve, or expand the operations of the organization.

Notice of Award (NoA): The official legally binding award document that notifies the applicant or recipient that an application for funding, increase in budget, or amendment has been approved. The NoA contains or references all the terms and conditions of the grant and federal funding limits; and provides the documentary basis for recording the obligation of federal funds in the agencies’ accounting systems. Also referred to as Notice of Grant Award (NGA). (WT)

Notice of Federal Interest (NFI): For purposes of 45 CFR §§75.318 and 75.323, a standard document the recipient must record upon using federal funds for the purchase, construction, and/or major renovation of real property to protect ACF federal interest in the real property. A NFI is a means to help secure the right of the ACF to recover the current fair market value of its percentage of participation in the cost of the real property when it is no longer used for program purposes or upon the disposition of the property. A NFI must be recorded in the official real property records in the jurisdiction where the real property is or will be located upon receipt of the federal Notice of Award. When related to a loan, ACF recommends the recipient amend NFIs upon ACFs approval to refinance the outstanding debt to make clear the existing federal interest under the prior financing arrangement notice continues. (WT)

Notice of Funding Opportunity (NOFO): Per 2 CFR §200.1, means a formal announcement of the availability of Federal funding through a financial assistance program from a federal awarding agency. The notice of funding opportunity provides information on the award, who is eligible to apply, the evaluation criteria for selection of an awardee, required components of an application, and how to submit the application. The notice of funding opportunity is any paper or electronic issuance that an agency uses to announce a funding opportunity, whether it is called a “program announcement,” “notice of funding availability,” “broad agency announcement,” “research announcement,” “solicitation,” or some other term.

O

Object Class: One way to classify financial data in the federal budget. An object class groups obligations by the types of items or services purchased by the federal government. Examples: "Personnel Compensation" and "Equipment." (WT)

Obligations: Per 45 CFR §75.2, means obligations, when used in connection with a non-federal entity's utilization of funds under a federal award, means orders placed for property and services, contracts and subawards made, and similar transactions during a given period that require payment by the non-federal entity during the same or a future period.

Office of Management and Budget (OMB): The Executive Office of the President, Office of Management and Budget.

Open-end mortgage: For the purpose of 45 CFR §75.318 or when used in connection with an encumbrance request, allows the borrower to borrow additional money on the same loan up to a certain limit. This saves the borrower the effort of going somewhere else in search of a loan. By doing so, the recipient is at risk of over obligating and exceeding the amount originally allowed or approved by ACF under the Federal award. Therefore, ACF will not consider an open-end mortgage. (WT)

Outlay or Expenditure: Charges made to the federally sponsored project or program. An outlay occurs when federal money is actually paid out, not just promised to be paid ("obligated"). (HHS GPS)

Oversight Agency for Audit: As defined by 45 CFR §75.2, is the federal awarding agency that provides the predominant amount of funding directly to a non-federal entity not assigned a cognizant agency for audit. When there is no direct funding, the federal awarding agency which is the predominant source of pass-through funding must assume the oversight responsibilities. The duties of the oversight agency for audit and the process for any reassignments are described in 45 CFR §75.513(b).

P

Parcel: For the purpose of 45 CFR §75.318 and 75.465, considered a quantity of land identified for taxation purposes. Parcels are identified by methods specific to the taxing authority. A single parcel may contain multiple buildings with separate street and/or mailing addresses. (WT)

Related terms include parcel number, legal description, and lot. A parcel number identifies the property as shown on the tax map. A legal description describes a specific parcel of real estate complete enough for an independent surveyor to locate and identify it. The description is by subdivision name, lot, and block in a platted subdivision, by certified survey map and lot number, or in unplotted lands, and it is identified according to the township, section, range associated with the Public Land Survey System or Private Claims or Government Lots. A lot is a measured parcel of land having fixed boundaries.

Participant Support Costs: As defined by 45 CFR §75.2, are direct costs for items such as stipends or subsistence allowances, travel allowances, and registration fees paid to or on behalf of participants or trainees (but not employees) in connection with conferences, or training projects.

Pass-Through Entity: As defined by 45 CFR §75.2, means a non-federal entity that provides a subaward to a subrecipient to carry out part of a federal program.

Pass-Through Program: A program where the recipient’s role is to select subrecipients that are expected to provide the services that are the purpose of the grant, coordinating and overseeing their activities, and providing the administrative support needed to meet ACF requirements. (WT)

Patent: Considered intellectual property. The HHS GPS defines this as a property right awarded by the Federal government whereby the government grants the right to exclude others from making, using, or selling the invention for a period of years.  See also Intangible Property 45 CFR §§75.2, 75.322, and 75.448. (WT)

Payment Management System (PMS): The centralized grants payment system for the Department of Health and Human Services.

Performance Goal: As defined by 45 CFR §75.2, a target level of performance expressed as a tangible, measurable objective, against which actual achievement can be compared, including a goal expressed as a quantitative standard, value, or rate. In some instances (e.g., discretionary research awards), this may be limited to the requirement to submit technical performance reports (to be evaluated in accordance with agency policy).

Period of Performance: As defined by 45 CFR §75.2, the time during which the non-federal entity may incur new obligations to carry out the work authorized under the federal award. The federal awarding agency or pass-through entity must include start and end dates of the period of performance in the federal award.

Personal Property: Per 45 CFR §75.2, includes property of any kind except real property. It may be tangible, having physical existence, or intangible, such as copyrights, patents, or securities.

Personally Identifiable Information (PII): As defined by 45 CFR §75.2, means information that can be used to distinguish or trace an individual's identity, either alone or when combined with other personal or identifying information that is linked or linkable to a specific individual. Some information that is PII is available in public sources such as telephone books, public Web sites, and university listings. This type of information is Public PII and includes, for example, first and last name, address, work telephone number, email address, home telephone number, and general educational credentials. The definition of PII is not anchored to any single category of information or technology. Rather, it requires a case-by-case assessment of the specific risk that an individual can be identified. Non-PII can become PII whenever additional information is made publicly available, in any medium and from any source, that, when combined with other available information, could be used to identify an individual.

Pre-Award Costs: Costs incurred prior to the beginning date of the period of performance, in anticipation of an award and at the applicant’s own risk, for otherwise allowable costs. (HHS GPS)

Prepayment clause: For the purpose of 45 CFR §75.318 or when used in connection with an encumbrance request; describes whether a borrower is allowed to prepay all or part of the loan amount before the end of the loan term with or without incurring any prepayment penalties. (WT)

Prepayment penalty: For the purpose of 45 CFR §75.318 or when used in connection with an encumbrance request, is a fee imposed on the borrower for partial or complete settlement of the loan before the expected payoff date. It is a means of compensating the lender for potential interest income not realized. A prepayment penalty is prohibited and must not be charge or claimed on the Federal award. (WT)

Principal Investigator/Program Director/ (PI/ PD): Defined in 45 CFR §75.2 as the individual (s) designated by the recipient to direct the project or program being supported by the grant. The PI/PD is responsible and accountable to officials of the recipient organization for the proper conduct of the project, program, or activity.

Prior Approval: as defined by 45 CFR §75.2, means written approval by an authorized HHS official evidencing prior consent before a recipient undertakes certain activities or incurs specific costs. According to 45 CFR §75.407(a), under any given federal award, the reasonableness, allocability, and allowability of certain costs may be difficult to determine. Therefore, a recipient may seek prior written approval. See 45 CFR §§75.308, 75.318, 75.320, 75.407, 75.439 and Real Property Guidance.

Program Income: Defined in 45 CFR §75.2 as gross income earned by the non-federal entity that is directly generated by a supported activity or earned as a result of the federal award during the period of performance except as provided in 45 CFR § 75.307(f). (See Period of performance.) Program income includes but is not limited to income from fees for services performed, the use or rental or real or personal property acquired under federal awards, the sale of commodities or items fabricated under a federal award, license fees and royalties on patents and copyrights, and principal and interest on loans made with federal award funds. Interest earned on advances of federal funds is not program income. Except as otherwise provided in federal statutes, regulations, or the terms and conditions of the federal award, program income does not include rebates, credits, discounts, and interest earned on any of them. See also 45 CFR §§ 75.307, 75.407 and 35 U.S.C. 200-212 (applies to inventions made under federal awards).

Progress Report: Periodic, usually annual, reports submitted by the recipient and used by the awarding office to assess progress and, except for the final progress report, to determine whether to provide funding for the next budget period. The progress report is also referred to as the performance report. (HHS GPS)

Project Costs: per 45 CFR §75.2, means total allowable costs incurred under a federal award and all required cost sharing and voluntary committed cost sharing, including third-party contributions.

Project Period: See Period of Performance.

Promissory Note: (Also called notes.) For the purpose of 45 CFR §75.318 or when used in connection with an encumbrance request means a debt instrument that contains a written promise by one party to pay another party a definite sum of money, either on demand or at a specified future date. A promissory note typically contains, but is not limited to, the principal amount, interest rate, maturity date, and date. This is not a stand-alone agreement. This document is a part of encumbrance, which requires prior approval. Only ACF programs that have real property authority are allowed, with prior approval, to use federal funds for this and/or related purpose. See Applicable ACF Programs with Real Property Authority and Real Property Guidance. (WT)

Property: As defined by 45 CFR §75.2, means real property and personal property.

Protected Personally Identifiable Information (Protected PII): Defined in 45 CFR §75.2 as an individual's first name or first initial and last name in combination with any one or more of types of information, including, but not limited to, social security number, passport number, credit card numbers, clearances, bank numbers, biometrics, date and place of birth, mother's maiden name, criminal, medical and financial records, educational transcripts. This does not include PII that is required by law to be disclosed. (See also Personally Identifiable Information (PII)).

Purchase: For the purpose of 45 CFR §75.318, means to buy a property. Only ACF programs that have real property authority are allowed, with prior approval, to use federal funds for this and/or related purposes. (WT)

For OHS recipients and subrecipients, per 45 CFR §1305.2 , this also "means purchasing an existing facility, including an outright purchase, down payment or through payments made in satisfaction of a mortgage or other loan agreement, whether principal, interest or an allocated portion principal and/or interest. The use of grant funds to make a payment under a capital lease agreement, as defined in the cost principles, is a purchase subject to these provisions. Purchase also refers to an approved use of Head Start funds to continue paying the cost of purchasing facilities or refinance an existing loan or mortgage beginning in 1987." 

For OCC CCDF, unless appropriations says otherwise, recipients may not use federal funds to purchase an existing building or facility, see 45 CFR §98.84  , 42 U.S.C. §9858d(b)(1) and §9858m(c)(6). Under the Consolidated Appropriations Act, 2023 (P.L. 117-328), States, Territories, and Tribes with prior approval may use disaster funding related to consequences of Hurricane Fiona and Ian to purchase real property (e.g., CCDF-ACF-PI-2023-02, ACF-OCC-CCDF-PI-2024-02).

Please note that, unlike the major renovation threshold, there is no threshold for purchase. When a program (such as the ORR-UC program) does not have statutory authority to allow recipients to use federal funds to purchase and establish a federal interest in real property, any cost towards the purchase (including finance and interest) may be disallowed if claimed to the federal award. See Applicable ACF Programs with Real Property Authority and Real Property Guidance.

Q

Questioned Cost: As defined by 45 CFR §75.2, a cost that is questioned by the auditor because of an audit finding:

1. Which resulted from a violation or possible violation of a statute, regulation, or the terms and conditions of a federal award, including for funds used to match federal funds.
2. Where the costs, at the time of the audit, are not supported by adequate documentation.
3. Where the costs incurred appear unreasonable and do not reflect the actions a prudent person would take in the circumstances.

R

Real Property: As defined by 45 CFR §§75.2, 1305.2 , and 98.2 , means “land, including land improvements, structures and appurtenances [affixed equipment] thereto, but excludes moveable machinery and equipment.”  Real property acquisition, construction, and major alteration and renovation are unallowable in the absence of specific statutory authority and prior approval. For more information see 45 CFR §§75.308, 75.407, 75.439, 75.462, Applicable ACF Programs with Real Property Authority, generally accepted accounting principles (GAAP), HHS GPS, and glossary terms Major Renovation and Major Renovation Threshold.

Reasonable cost: A cost whose nature or amount does not exceed that which would be incurred by a prudent person under the circumstances prevailing when the decision was made to incur the cost. (HHS GPS)

Recipient: As defined by 45 CFR §75.2, an entity, usually but not limited to non-federal entities, that receives a federal award directly from a federal awarding agency to carry out an activity under a federal program. The recipient is the entire legal entity even if a particular component is designated in the Notice of Award (NoA). The term includes “grantee” and “non-federal entity.” The term recipient does not include subrecipients.

Reimbursement: A payment made to a recipient upon its request after it makes cash disbursements. Most reimbursement payments are processed through PMS. (HHS GPS)

Renovation. See Alteration and Renovation (A&R).

Repair: See Maintenance and Repair Costs.

Research: Defined by 45 CFR §75.2 as a systematic study directed toward fuller scientific knowledge or understanding of the subject studied. “Development” is the systematic use of knowledge and understanding gained from research directed toward the production of useful materials, devices, systems, or methods, including design and development of prototypes and processes.

Research and Development (R&D): Defined by 45 CFR §75.2 includes all research activities, both basic and applied, and all development activities that are performed by HHS award recipients. The term research also includes activities involving the training of individuals in research techniques where such activities utilize the same facilities as other research and development activities and where such activities are not included in the instruction function.

Right of Setoff: For the purpose of 45 CFR §75.318 or when used in connection with an encumbrance request, is a provision that gives a lender, a bank usually, the right to seize deposited funds to cover a loan that is in default. This may a problem if the bank requires the borrower to maintain a security balance in an offset account that contains Federal funds and are used to satisfy the requirement. Such costs could amount to unallowable contingency expenses and bad debts. Federal funds cannot be used to satisfy this clause. (WT)

S

Security accounts: See Right of Setoff. (WT)

Security Agreement: For the purpose of 45 CFR §75.318 or when used in connection with an encumbrance request, a written agreement that provides a lender a security interest in a specified asset or property that is pledged as collateral. If the borrower defaults, the pledged collateral can be seized and/or sold according to the terms in the agreement. The agreement must be recorded for the lender to have priority over subsequent creditors. Security agreement is a statutory creation. Federal funds cannot be used to satisfy this clause. (WT)

Services: Intangible and may result in a good or product. It is also generally considered a professional or consultant service rendered by persons who are members of a particular profession or possess a special skill and who may not be officers or employees of the non-federal entity. Services include, but are not limited to, cleaning and maintenance of facilities or equipment. For more information see 45 CFR §75.459. (WT)

Setoff Provision: See Right of Setoff. (WT)

Short-term loan: For the purpose of 45 CFR §75.318 or when used in connection with an encumbrance request, is a debt instrument that has a maturity date of less than 15 years. ACF may not consider short-term loans. (WT)

Significant Rebudgeting: A threshold that is reached when expenditures in a single direct cost budget category deviate (increase or decrease) from the approved budget amount for that budget category for that budget period by a specified amount of the total costs awarded. Significant re-budgeting is one indicator of change in scope. ACF is applying the significant budget threshold as follows:

• Awards with the Federal share exceeding the Simplified Acquisition Threshold (SAT), the significant rebudgeting threshold is 10%. (45 CFR §75.308(e)) (effective on or after 10/1/2025: 2 CFR §200.308(i) ))
• Awards below the SAT, the threshold is 25%. (HHS GPS)

Simplified Acquisition Threshold: Per 45 CFR §75.2, means the dollar amount below which a non-federal entity may purchase property or services using small purchase methods. Non-federal entities adopt small purchase procedures in order to expedite the purchase of items costing less than the simplified acquisition threshold. The simplified acquisition threshold is set by the Federal Acquisition Regulation at 48 CFR subpart 2.1 and in accordance with 41 U.S.C. 1908. The simplified acquisition threshold is currently set at $250,000, but this threshold is periodically adjusted for inflation. For more information see 48 CFR Part 2.1 . The simplified acquisition threshold has no bearing on the major renovation threshold.

While the simplified acquisition threshold intent may allow non-federal entities to use a reduced purchasing process to expedite the purchase of certain items, it does not mean that they should disregard the 45 CFR §75.407 Prior Written Approval, various property related requirements, and the program specific statutory authority and regulations related to property. Essentially, this means that a non-federal entity must continue to request prior written approval to purchase, construct, and/or make major renovations even if costs are under the simplified acquisition threshold.

Special Purpose Equipment: Defined by 45 CFR §75.2 as equipment which is used only for research, medical, scientific, or other technical activities. Examples of special purpose equipment include microscopes, x-ray machines, surgical instruments, and spectrometers. See also Equipment and General Purpose Equipment.

State: Defined by 45 CFR §75.2 as any state of the United States, the District of Columbia, the Commonwealth of Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, the Commonwealth of the Northern Mariana Islands, and any agency or instrumentality thereof exclusive of local governments.

Standard Authorized Organization Representative (AOR): An AOR is a member of your organization authorized by the EBiz point of contact to submit applications in Grants.gov on behalf of the organization. An applicant user with the Standard AOR role can only submit applications when they are a participant of that workspace. (WT)

Stipend: A payment made to an individual under a fellowship or training grant in accordance with established levels to provide for the individual’s living expenses during the period of training. A stipend is not considered compensation for the services expected of an employee. (HHS GPS)

Subaward: Defined by 45 CFR §75.2 as an award provided by a pass-through entity to a subrecipient for the subrecipient to carry out part of a federal award received by the pass-through entity. It does not include payments to a contractor or payments to an individual that is a beneficiary of a federal program. A subaward may be provided through any form of legal agreement, including an agreement that the pass-through entity considers a contract.

Subordination: For the purpose of 45 CFR §75.318 or when used in connection with an encumbrance request, is when one party takes a subordinate position (second or third) when a real property is encumbered. ACF may consider subordinations, but only as a last resort. (WT)

Subordination Agreement: For the purpose of 45 CFR §75.318 or when used in connection with an encumbrance request, is a written agreement among ACF, the recipient, and the Lender in which ACF agrees to subordinate its interest in the real property (not the personal property) to the Lender; and the Lender grants ACF certain rights, such as an opportunity to cure in the event the Recipient defaults. ACF may consider subordinations, but only as a last resort. (WT)

Subrecipient: Defined by 45 CFR §75.2 as a Non-federal entity that receives a subaward from a pass-through entity to carry out part of a federal program; but does not include an individual that is a beneficiary of such program. A subrecipient may also be a recipient of other federal awards directly from a federal awarding agency.

Supply/Supplies: Per 2 CFR §200.1, means all tangible personal property other than those described in the Equipment definition. A computing device is a supply if the acquisition cost is below the lesser of the capitalization level established by the recipient or subrecipient for financial statement purposes or $10,000, regardless of the length of its useful life. See definitions for Computing Devices and Equipment. See Tangible Personal Property Guidance.

Surplus Property: See Excess property.

Suspension of Award Activities: Defined by 45 CFR §75.2 as an action by the HHS awarding agency requiring the recipient to cease all activities on the award pending corrective action by the recipient. It is a separate action from suspension under HHS regulations (2 CFR part 376) implementing Executive Orders 12549 and 12689.

System for Award Management (SAM): SAM validates applicant information and electronically shares the secure and encrypted data with the federal agencies' finance offices to facilitate paperless payments through Electronic Funds Transfer (EFT). SAM stores your organizational information, allowing Grants.gov to verify your identity and to pre-fill organizational information on your grant applications. For more information, review the Register with SAM  page.

T

Tangible Property: Includes equipment, supplies, and any other property (including information technology systems) other than that which is defined as an intangible property. See definitions for Capital Assets, Capital Expenditures, Equipment, Intangible Property, Personal Property, and Supplies. See Tangible Personal Property Guidance. (WT)

Termination: Defined by 45 CFR §75.2 as the ending of a federal award, in whole or in part at any time prior to the planned end of period of performance.

Terms and Conditions of Award: All legal requirements imposed on a grant by the awarding office, whether based on statute, regulation, policy, or other document referenced in the Notice of Award (NoA) or specified by the NoA itself. In addition to general terms and conditions, the NoA may include other conditions that are considered necessary to attain the award’s objectives, facilitate post-award administration, conserve grant funds, or otherwise protect the federal government’s interests. (HHS GPS)

Third-party In-kind Contributions: Per 45 CFR §75.2, means the value of non-cash contributions (i.e., property or services) that:

1. Benefit a federally assisted project or program; and
2. Are contributed by non-federal third parties, without charge, to a non-federal entity under a federal award.

Total Project or Program Costs: The total allowable costs (both direct and indirect) incurred by the recipient to carry out a grant-supported project or activity. Total project or program costs include costs charged to the award and costs borne by the recipient to satisfy a matching or cost-sharing requirement. (HHS GPS)

Treasury Account Symbol (TAS): An identification code assigned by the Department of the Treasury in collaboration with the Office of Management and Budget (OMB) to each appropriation, receipt, or fund account. This code is like a bank account number. It helps identify financial transactions in the federal government. It also aids in reporting accuracy.

U

Unallowable Cost: A cost specified by law or regulation, federal cost principles, or term and condition of award that may not be reimbursed under a grant or cooperative agreement. (HHS GPS)

Unique Entity Identifier (UEI): The official identifier for doing business with the U.S. Government, replacing the DUNS number as of April 4, 2022. Entities are assigned a 12-character, alphanumeric value (UEI) as part of the SAM.gov registration process. All entities doing business with the federal government must have a UEI.

Unliquidated Obligations: Per 45 CFR §75.2 means, for financial reports prepared on a cash basis, these are obligations incurred by the non-federal entity that have not been paid (liquidated). For financial reports prepared on an accrual expenditure basis, these are obligations incurred by the non-federal entity for which an expenditure has not been recorded.

Unobligated Balance: Defined by 45 CFR §75.2 as the amount of funds authorized under a federal award that the non-federal entity has not obligated. The amount is computed by subtracting the cumulative amount of the non-federal entity's unliquidated obligations and expenditures of funds under the federal award from the cumulative amount of the funds that the federal awarding agency or pass-through entity authorized the non-federal entity to obligate.

V

Variable interest rates: For the purpose of 45 CFR §75.318, or when used in connection with an encumbrance request, is an interest rate that can change over the course of the term of the loan. These types of loans typically cost the borrower more over the term of the loan. ACF considers this type of rate high-risk and must be avoided. (WT)

Voluntary committed cost sharing: Defined by 45 CFR §75.2 as cost sharing specifically pledged on a voluntary basis in the proposal's budget or the federal award on the part of the non-federal entity and that becomes a binding requirement of federal award.

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Withholding of Payment: An action taken by an awarding office, after appropriate administrative procedures have been followed, that restricts a recipient’s ability to access its grant funds until the recipient takes corrective action required by the awarding office. (HHS GPS)

Withholding of Support: A decision by an awarding office not to make a non-competing continuation award within a previously approved project period. (HHS GPS)

Working Capital Advance: Defined by 45 CFR §75.2 as a procedure whereby funds are advanced to the recipient to cover its estimated disbursement needs for a given initial period.

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