Glossary

A

Accrual Basis: 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, and the net increase or decrease in the amounts owed by the recipient or subrecipient for goods and other property received, services performed by employees, contractors, subrecipients, and other payees, and programs for which no current services or performance are required, such as annuities, insurance claims, or other benefit payments. (HHS GPS)

Acquisition Cost:  means the (total) cost of the asset including the cost to ready the asset for its intended use. For example, acquisition cost for equipment 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 recipient’s or subrecipient’s regular accounting practices. (UAR)

Adjustable-rate mortgage (ARM): for purposes of 2 CFR §200.311 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 Federal awards in general, such as financial management, kinds and frequency of reports, equipment management, and retention of records. These are distinguished from programmatic requirements, which concern matters that can be treated only on a program-by-program or award-by-award basis, such as kinds of activities that can be supported by awards under a particular program. (WT and HHS GPS)

Advance Payment: means a payment that a Federal agency or pass-through entity makes by any appropriate payment mechanism and payment method before the recipient or subrecipient disburses the funds for program purposes. (UAR)

Agency: the agency responsible for making, monitoring, and overseeing awards. For changes in award terms or for approval requests, the reference may be to the GMS. This is sometimes referred to as “Federal agency” or “Federal agency.” See 2 CFR 200.1 Federal agency.  (HHS GPS)

Allocation: means 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. (UAR)

Allocable Cost: relates to a specific project or activity based on the relative benefits it provides. It's allocable to a federal award if: 1) it's specifically for the award, 2) it benefits both the award and other tasks and can be distributed based on those benefits, and 3) it's needed for the organization's overall functioning. See 2 CFR §200.405 allocable cost. (HHS GPS)

Allowable Cost: a cost incurred by a recipient that is: (1) necessary; (2) reasonable for the performance of the award; (3) allocable; (4) in conformance with, or incorporated by reference, 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; (5) consistent with regulations, policies and procedures of the recipient that apply uniformly to both federally supported and other activities of the organization; (6) accorded consistent treatment as a direct or indirect cost; (7) determined in accordance with generally accepted accounting principles; and (8) not included as a cost in any other federally supported award (unless specifically authorized by statute). (WT) See 2 CFR §200.403 for additional information.

Alteration and Renovation (A&R): involve changing the inside or features of a facility or installed equipment to enhance its current use or adapt it for a new purpose. It can include improvements, remodeling, or modernization but is different from construction or major permanent upgrades. (GPS)

Additional ACF Policy Clarification: 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 2 CFR §§200.308, 200.311, 200.407, 200.439, 200.462, 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 award, 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 2 CFR §200.311 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. (WT)

Applicable Credit:  receipts that offset or reduce direct or indirect costs. Typical examples include purchase discounts, rebates, or allowances; recoveries or indemnities on losses; insurance refunds; and adjustments of overpayments or erroneous charges. (See 2 CFR §200.406 and HHS GPS)

Application: a request for financial support of a project or activity submitted on specified forms and in accordance with awarding agency instructions. (HHS GPS)

Appraisal: for purposes of 2 CFR §200.311, means an objective assessment of a property’s market value, typically used in real estate transactions such as acquisition, pre and post construction and renovations, selling, or refinancing. An appraisal must be conducted by an independent appraiser and certified by a responsible official of the recipient or subrecipient. (WT) 

Additional ACF Policy Clarification: The appraisal conducted by an independent certified appraiser must be no more than three (3) years old.

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 spending plan for a project funded by an award. This budget has both federal funds and, if applicable, non-federal funds like cost-sharing. If both types of funds are in the budget, the recipient must spend them in the same ratio as they appear in the total budget. (HHS GPS)

Assigned: for property purposes described in 2 CFR §200.311, 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 2 CFR §200.311 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. It is a type of collateral for the loan. (WT)

Additional ACF Policy Clarification: The provision in the financing arrangement may be acceptable, if it is clear the provision applies only as Lender’s remedy in the event of default. 

Recipients renting out a federal interest property is uncommon. However, rental payments of federal interest property would be considered program income under the Federal award and recipients must comply with the program income requirements at 2 CFR §200.307. 

Assistance Listings:  refers to the publicly available listing of Federal assistance programs managed and administered by the General Services Administration (GSA) at SAM.gov .  (UAR)

Assistance Listing Numbers:  means a unique number assigned to identify an Assistance Listing. (UAR)

Assistance Listing Program Title: means the title that corresponds to the Assistance Listing number. (UAR)

Assurance: a written statement by an applicant, normally included with the application, that it will follow a particular requirement if there is an award. (HHS GPS)

Audit Finding: means deficiencies which the auditor is required to report in the schedule of findings and questioned costs. (See §200.516(a)) (UAR)

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

Auditee:  means any non-federal entity that must be audited under this part. (See §200.501) (UAR)

Auditor:  means an auditor who is a public accountant or a Federal, State, local government, or Indian Tribe audit organization that 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. (UAR)

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 applications or awards. (WT)

Award: the document that provides the awarding agency funds to a recipient to carry out an approved project, based on an approved application. In the GPS, award means both grants and cooperative agreements. (HHS GPS)

Award Number: a unique identification number for each individual award. The final two digits “00” reflects the initial Notice of Award and change with each subsequent amendment (01, 02, etc.). (WT)

Awardee: See Non-Federal Entity.

B

Balloon mortgage: for purposes of 2 CFR §200.311 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. (WT)

Additional ACF Policy Clarification: ACF will not consider balloon mortgages. 

Balloon payment: for purposes of 2 CFR §200.311 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. (WT)

Additional ACF Policy Clarification: ACF will not consider a loan with a balloon payment. 

Block Grant: given primarily to general purpose governmental units in accordance with a statutory formula. Such grants can be used for a variety of activities within a broad functional area.  (WT)

Budget:  means the financial plan for the Federal award that the Federal 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 agency or pass-through entity. (UAR)

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:  means the time interval from the start date of a funded portion of an award to the end date of that funded portion, during which recipients and subrecipients are authorized to incur financial obligations of the funds awarded, including any funds carried forward or other revisions pursuant to §200.308. (UAR)

The GPS clarifies further that the budget period is usually 12 months each and is sometimes referred to as “incremental funding.” 

Bundled loan: for purposes of 2 CFR §200.311 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). (WT)

Additional ACF Policy Clarification:  ACF will not consider bundled loans. 

C

Call option provision: for property purposes described in 2 CFR §200.311 or when used in connection with an encumbrance request, gives the Mortgagor/Lender the right to demand early repayment of the loan. (WT)

Additional ACF Policy Clarification: This is a high-risk provision for ACF and the recipient.  It is advised that it be stricken or waived from the debt instrument. 

Capital Assets: means: 

1. 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:
2. For purpose of this part, capital assets do not include intangible right-to-use assets (per GASB) and right-to-use operating lease assets (per FASB). For example, assets capitalized that recognize a lessee’s right to control the use of property or equipment for a period of time under a lease contract. See §200.465. (UAR)

i. Land, buildings (facilities), equipment, and intellectual property (including software) whether acquired by purchase, construction, manufacture, exchange, or through a lease accounted for as a financed purchase under Government Accounting Standards Board (GASB) standards or a finance lease under Financial Accounting Standards Board (FASB) standards; and

ii. 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: 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. (UAR)

For more information see 2 CFR §§200.308, 200.407, 200.436, 200.439, ACF Property Guidance, GAAP, HHS GPS, and glossary for related terms Construction, Major Renovation, Major Renovation Threshold, and Real Property.

Carryover: unspent federal funds from a particular budget period that can be transferred and used in the next, or later, budget period used to cover allowable expenses in that subsequent period. Funds that have been committed but not yet spent (obligated but unliquidated) are not classified under carryover. (HHS GPS) 

Additional ACF Policy Clarification: Prior approval is required for programs without expanded authorities.

Cash basis: an accounting method in which revenue and expenses are recorded on the books of account when received and paid, respectively, without regard to the period in which they are earned or incurred. It is different than accrual basis. (HHS GPS)

Cash out loan: for purposes of 2 CFR §200.311 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. (WT)

Additional ACF Policy Clarification: 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. 

Central Service Cost Allocation Plan: means the 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 its departments and agencies on a centralized basis. The costs of these services may be allocated or billed to users. (UAR)

Change in Scope:  an activity whereby the objectives or specific aims identified in the approved 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: transfer of the legal and administrative responsibility for an award from one legal entity to another before the end of the period of performance. (HHS GPS)

Chief Grants Management Officer (CGMO): means the principal Grants Management Officer (GMO) within an awarding office. The CGMO is responsible for the awarding office’s implementation and adherence to policy and regulatory requirements. (WT)

Claim: means, depending on the context, 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.
   • 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. (UAR)

Class of Federal Awards: means a group of Federal awards either awarded under a specific program or group of programs or to a specific type of recipient or group of recipients to which specific provisions or exceptions may apply. (UAR)

Closeout:  means the process by which the Federal 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. (UAR)

Additional ACF Policy Clarification: When the program regulations differ from that of the UAR, the program regulations take precedent.

Cluster of Programs: 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 clusters,” a State must identify the Federal awards included in the cluster and advise the subrecipients of compliance requirements applicable to the cluster, consistent with §200.332. A cluster of programs must be considered as one program for determining major programs as described in §200.518, and, with the exception of R&D as described in §200.501(d), whether a program-specific audit may be elected. (UAR)

Cognizant Agency for Audit:  means the Federal agency designated to carry out the responsibilities described in §200.513(a). The cognizant agency for audit is not necessarily the same as the cognizant agency for indirect costs. A list of Federal agency Single Audit contacts can be found on the Federal Audit Clearinghouse (FAC) website. (UAR)

Cognizant Agency for Indirect Costs:  means the Federal agency responsible for reviewing, negotiating, and approving cost allocation plans or indirect cost proposals 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 Institutions of Higher Education (IHEs): Appendix III, paragraphC.11.
2. For nonprofit organizations: Appendix IV, paragraph C.2.a.
3. For State and local governments: Appendix V, paragraph  F.1.
4. For Indian Tribes: Appendix VII, paragraph D.1. (UAR)

Competition: a process in which applications undergo a merit review and are evaluated against established evaluation criteria in the NOFO. (HHS GPS)

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

Compliance supplement:  means an annually updated authoritative source of information for auditors that identifies existing important compliance requirements that the Federal Government expects to be considered as part of an audit. Auditors use it to understand the Federal program's objectives, procedures, and compliance requirements, as well as audit objectives and suggested audit procedures for determining compliance with the relevant Federal program. (UAR) 

Computing Devices: means machines that 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. (UAR)

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). (WT)

Additional ACF Policy Clarification: unlike the major renovation threshold, there is no threshold for construction. Only ACF programs that have real property authority are allowed, with prior approval, to use federal funds for this and/or related purpose.  For instance, 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, any cost towards the construction may be disallowed if claimed to the Federal award. For more information, see 2 CFR §§200.308, 200.407, 45 CFR §§1305.2, 98.2, Applicable ACF Programs with Real Property Authority and Real Property Guidance.

Consultant: an individual who provides professional advice or services for a fee, but normally not as an employee of the engaging party. Also includes a firm that provides paid professional advice or services. (HHS GPS)

Continuation Funding: means the second or subsequent budget period within an identified period of performance. (UAR)

Additional ACF Policy Clarification: Continuation awards are dependent on the availability of funds, satisfactory progress by the recipient, and compliance with terms and conditions. They are typically available to existing recipients of discretionary and multi-year projects. 

Contract: means, for the purpose of the Federal financial assistance, a legal instrument by which a recipient or subrecipient conducts procurement transactions under a Federal award. For additional information on subrecipient and contractor determinations, see §200.331. See also the definition of subaward. (UAR)

Contract Under an Award: a written agreement between a recipient/subrecipient and a third party to acquire commercial goods or services. This may also be called a subcontract. (HHS GPS)

Contractor: means an entity that receives a contract. (UAR)

Conventional loans: For the purposes of 2 CFR §200.311 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)

Additional ACF Policy Clarification: ACF will consider low risk, ideal, and reasonable terms and provisions, which minimizes federal financial interest risk. These include, but are not limited to: long term, low interest, fixed rate, and fully amortized loans. Any debt instrument or related document that are not low-risk and reasonable will be scrutinized heavily, which will delay ACFs decision.

Convey: For the purpose 2 CFR §200.311 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: means a legal instrument of financial assistance between a Federal awarding agency and a recipient or between a pass-through entity and a subrecipient, 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 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 agency or pass-through 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. (UAR)

Copyright: Considered the legal right on an intellectual property. For more information, see 2 CFR §§200.1, 200.315, and 200.448. (WT)

Corrective action: 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. (UAR)

Cost Allocation Plan:  means a central service cost allocation plan or public assistance cost allocation plan. (UAR)

Cost Analysis: the systematic review of a budget proposal to:

• Detail and assess cost components;
• Ensure costs are necessary, reasonable, and allocable; and
• Confirm alignment with federal guidelines, ensuring no unallowable expenses. (HHS GPS)

Cost objective:  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 recipient or subrecipient, a particular service or project, a Federal award, or an indirect cost activity, as described in Subpart E. See also the definition of final cost objective and intermediate cost objective. (UAR)

Cost Sharing:  means the portion of project costs not paid by Federal funds or contributions (unless authorized by Federal statute). This term includes matching, which refers to required levels of cost share that must be provided. See §200.306. (UAR)  

Additional ACF Policy Clarification: This may include the value of allowable third party in- kind contributions, as well as expenditures by the recipient. 

• For OHS recipients and subrecipients: “Non-federal match. Any non-federal match associated with facilities activities becomes part of the federal share of the facility.” (45 CFR §1303.44(c)) See also glossary term Federal Interest. 

Cross-collateralization: For property purposes as described in 2 CFR §200.311 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. (WT)

Additional ACF Policy Clarification: ACF will not consider debt instruments with a cross-collateralization. 

Cross-default: For property purposes as described in 2 CFR §200.311 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. (WT)

Additional ACF Policy Clarification: ACF will not consider debt instruments with a cross-default. 

D

Debt instruments: for the purpose of 2 CFR §200.311 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 2 CFR §200.311, means a limitation written on a deed to restrict control, occupancy, or property use. (WT)

Additional ACF Policy Clarification: As a type of encumbrance, ACF must be made aware of any deed restrictions or provisions impacting a property with federal interest (established or in process).

Departmental Appeals Board (DAB): 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. (WT)

Depreciation: the method for allocating the cost of fixed assets to periods benefiting from asset use. The recipient or subrecipient may be compensated for the use of its buildings, capital improvements, equipment, and software projects capitalized in accordance with GAAP if they are needed and used in the recipient's or subrecipient's activities and correctly allocated to Federal awards. The compensation must be made by computing the proper depreciation. (WT)

For more information, see 2 CFR §§200.306, 200.414, 200.434, 200.436, 200.439, 200.443, 200.445, 200.446, 200.449, 200.465, 200.475, Appendices of the UAR, program regulations, and recipient and subrecipient accounting procedures. 

Direct Costs: costs that can be identified specifically with a particular final cost objective, such as a Federal award, or other internally or externally funded activity, or that can be directly assigned to such activities relatively easily with a high degree of accuracy. (WT) For more information, see 2 CFR §§200.412 and 200.413.

Disallowed costs:  means charges to a Federal award that the Federal agency or pass-through entity determines to be unallowable in accordance with applicable Federal statutes, regulations, the provisions of the UAR, or the terms and conditions of the Federal award. (UAR) For more information, see 2 CFR §200.410.

Discretionary Award:  means an award in which the Federal agency, in keeping with specific statutory authority that enables the agency to exercise judgment (“discretion”), selects the recipient 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.  (UAR)

Due on sale consent by lender: for purposes of 2 CFR §200.311 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. (WT)

Additional ACF Policy Clarification: 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. Disposition instructions under 2 CFR §200.311(d) must be followed. 

E

Easement:  for purposes of 2 CFR §200.311, means the right of one party to use or access real property that's owned by another for a limited and specific purpose. Easements for utility, cable, and similar services that benefit the real property and are consistent with the authorized use are not considered an encumbrance. (WT)

Additional ACF Policy Clarification: ACF must be made aware of any easements (considered an encumbrance) impacting a property with federal interest (established or in process). 

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)

Additional ACF Policy Clarification: As a type of encumbrance, ACF must be made aware of any encroachments impacting a property with federal interest (established or in process).

Encumbrance: for purposes of 2 CFR §200.311, means 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)

Additional ACF Policy Clarification: The recipient or subrecipient must not encumber its title or other interests to real property that was acquired or improved under a Federal award without ACF approval. See 2 CFR §200.311 and Real Property Prior Approvals.

Entity Identification Number (EIN): A 12-character code in Payment Management System (PMS) comprising of three-parts:  the first character indicates if the recipient is an organization or an individual; the following 9 characters represent the Internal Revenue Service tax number identification (TIN) for organizations or the social security number (SSN) for individuals; the final 2 characters differentiate between organizational entities with the same or multiple EINs, denoting subsidiaries, branches, or other subdivisions. (HHS GPS)

Equipment:  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. (UAR)

See Tangible Personal Property Guidance. 

Excess Property:  means property that, as decided by the head of the agency or its representative, is no longer needed for the agency's functions or responsibilities. (HHS GPS)

Exempt Property: Tangible personal property bought either entirely or partly with federal funds, where the agency has the legal authority to vest title to the recipient without additional obligations to the federal government. (HHS GPS)

Expanded Authorities: permissions granted to recipients that eliminate the need for prior approval from the awarding agency for certain activities. (HHS GPS).

Additional ACF Policy Clarification: Three expanded authorities exist under 2 CFR §200.308(g), which are 1) pre-award costs, 2) one-time extensions, and 3) carryover of unobligated balances. However, expanded authorities only applies when the Notice of Award indicates it. Regardless, if it applies or not, ACF does not waive prior approval requirements identified under 2 CFR §§200.308(f) and (i), 200.311, 200.313, 200.314, 200.407, and 200.439 as well as within program regulations and statutes. Funds may only be used for purpose(s) for which they were awarded. Any costs incurred without proper ACF approval may be subject to disallowance.

Expenditures:  means charges made by a recipient or subrecipient 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; and 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 recipient or subrecipient for: goods and other property received; services performed by employees, contractors, subrecipients, and other payees; and programs for which no current services or performance are required, such as annuities, insurance claims, or other benefit payments. (UAR)

F

Facilities and Administrative Costs: See Indirect Costs.

Facility: real property (e.g., building, structure) or modular unit for use by a recipient.  (WT)

Additional ACF Policy Clarification: A facility may or may not have an established federal interest in the real property. Only a few ACF programs allow recipients (with prior approval) to use federal funds to acquire, construct, and/or make major renovations to real property. For more information about federal interest and applicable programs, see the Real Property Guidance page. 

Federal Agency:  means an ’’agency'' as defined at 5 U.S.C. 551(1) and further clarified by 5 U.S.C. 552(f). The term generally refers to the agency that provides the Federal award directly to a recipient unless the context indicates otherwise. See also definitions of Federal award and recipient. (UAR)

Federal Audit Clearinghouse (FAC): means the repository of record designated by OMB where non-Federal entities must transmit required by Subpart F. (UAR)

Federal Award:  has the meaning, depending on the context, in either paragraph (1) or (2) of this definition:

1. The Federal financial assistance that a recipient receives directly from a Federal agency or indirectly from a pass-through entity, as described in §200.101; or the cost-reimbursement contract under the Federal Acquisition Regulations that a non-Federal entity receives directly from a Federal agency or indirectly from a pass-through entity, as described in §200.101.
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 government-owned, contractor-operated (GOCO) facilities.
4. See also definitions of Federal financial assistance, grant agreement, and cooperative agreement. (UAR)

Federal Award Date:  means the date when the authorized official of the Federal agency signed (physically or digitally) the Federal award or when an alternative, consistent with the requirements of 31 U.S.C. 1501 , is reached with the recipient. (UAR)

Federal Award Identification Number (FAIN): A number, unique within the Federal agency, assigned to each award for financial assistance. (WT)  

Federal Awardee Performance and Integrity Information System (FAPIIS): the Federal Awardee Performance and Integrity Information System (FAPIIS) is the integrity and performance system established by OMB and GSA that includes government-wide data with specific information related to the integrity and performance of recipients and subrecipients. The FAPIIS.gov integrity records are now called Responsibility and Qualification information in SAM.gov which is located within Entity Information. (WT)

Federal Financial Assistance:  means:

1. Assistance that recipients or subrecipients 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; and other financial assistance (except assistance listed in paragraph (2) of this definition).
2. For 2 CFR §200.203 and Subpart Fof 2 CFR Part 200, Federal financial assistance also includes assistance that recipients or subrecipients receive or administer in the form of: loans; loan guarantees; interest subsidies; and insurance.
3. For 2 CFR §200.216, Federal financial assistance includes assistance that recipients or subrecipients receive or administer in the form of: grants; cooperative agreements; loans; and loan guarantees.
4. Federal financial assistance does not include amounts received as reimbursement for services rendered to individuals as described in 2 CFR §200.502(h) and (i).
5. For 45 CFR Part 184, in addition to the forms of assistance listed in paragraph (1) of this definition, Federal financial assistance also includes assistance that recipients or subrecipients receive or administer in the form of: Loans; and Loan Guarantees. (UAR)

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. (WT)

Federal Institution: A Cabinet-level department or independent agency within the executive branch of the federal government, or any of its sub-entities. (HHS GPS)

Federal Interest:  means for purposes of 2 CFR §200.330 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. The percentage of Federal participation in the total cost of the real property, equipment, or supplies ; 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. (UAR)

Additional ACF Policy Clarification: The current fair market value is based on an appraisal (no more than three (3) years old) conducted by an independent certified appraiser.  

Additional ACF Program-Specific Clarification:

• For OHS recipients and subrecipients: Federal interest is 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 subject to 45 CFR Part 1303 Subpart E funding 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 make major renovations to a facility, or make mortgage payments, it creates a Federal interest. The Federal interest includes any portion of the cost of purchase, construction, or major renovation contributed by or for the entity, or a related donor organization, to satisfy a matching requirement.. (45 CFR §1305.2)

Federal Program: means:

1. All Federal awards which are assigned a single Assistance Listings Number.
2. When no Assistance Listing number is assigned, all Federal awards from the same agency made for the same purpose must be combined and considered one program.
3. Notwithstanding paragraphs (1) and (2) of this definition, a cluster of programs. The types of clusters of programs are: Research and development (R&D); Student financial aid (SFA); and “other clusters,” as described in the definition of cluster of programs in this glossary. (UAR)

Federal Share: means the portion of Federal award costs paid using Federal funds. (UAR)

Additional ACF Program-Specific Clarification:

• 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.

Fee: a sum paid beyond the actual allowable costs to an entity delivering goods or services in line with the standard commercial practice, often referred to as “profit.” (HHS GPS)

Financial Conflict of Interest (FCOI): a significant financial interest that could directly compromise or bias professional judgement and objectivity. (WT)

Final Cost Objective: means a cost objective that has allocated to it both direct and indirect costs and, in the recipient's or subrecipient’s accumulation system, is one of the final accumulation points, such as a particular award, internal project, or other direct activity of a recipient or subrecipient. See also the definitions of cost objective and intermediate cost objective. (UAR)

Financial Assistance: The provision of funds, property in place of funds, or other direct aid to qualified recipient to encourage or further a public purpose authorized by law. (HHS GPS)

Financial Obligations:  means orders placed for property and services, contracts and subawards made, and similar transactions that require payment by a recipient or subrecipient under a Federal award that will result in expenditures by a recipient or subrecipient under a Federal award. (UAR)

Financial Reconciliation: The process of ensuring that reported federal cash status and expenditure information are equal, including making (or requiring the recipient to make) any necessary adjustments, e.g., for an overpayment. (WT)

First-tier subaward: An award made by a pass-through entity to a subrecipient, where the subrecipient is accountable to the pass-through entity for the use of the Federal funds provided by the subaward. (WT)

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:  means a type of grant or cooperative agreement pursuant to which the Federal agency or pass-through entity provides a specific amount of funding 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 recipient or subrecipient and Federal agency or pass-through entity. Accountability is based primarily on performance and results. See 2 CFR §§200.102(c), 200.101(b), 200.201(b), and 200.333. (UAR)

Fixed rate mortgage: for purposes of 2 CFR §200.311, means when used in connection with an encumbrance request, a mortgage where the interest rate remains the same throughout the life of the loan. (WT)

Additional ACF Policy Clarification: ACF considers a fixed rate the ideal type of arrangement. 

Floating/ARM Mortgage: for purposes of 2 CFR §200.311, means 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. (WT)

Additional ACF Policy Clarification: ACF considers this type of mortgage high-risk and must be avoided. 

Flow down / flow through requirements: terms and conditions of the federal award that are required to be applied to subrecipients and their subawards, that is, “flowed down” by the recipient. In most cases, these requirements are the same requirements that apply to the recipient/award. (WT)

For-profit organization: generally means an organization or entity organized for the purpose of earning a profit. The term includes but is not limited to: an “S corporation” incorporated under subchapter S of the Internal Review Code; a corporation incorporated under another authority; a partnership; a limited liability company or partnership; and a sole proprietorship. (UAR)

Foreign Component: The performance of a major part or component of a project outside the United States by the recipient or by a researcher affiliated with a foreign institution, regardless of whether award funds are used. (HHS GPS)

Foreign Organization:  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. (UAR)

Foreign Public Entity:  means:

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. (UAR)

Formula Awards: Allocations of federal funding to states, territories, or local units of government determined by distribution formulas in the authorizing legislation and regulations. Formula awards 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 purposes of 2 CFR §200.311, means 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)

G

General Purpose Equipment:  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 and special purpose equipment. (UAR)

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

Generally Accepted Government Auditing Standards (GAGAS): also known as the [GAO] Yellow Book  , means generally accepted government auditing standards issued by the Comptroller General of the United States, which apply to financial audits. (UAR)

Grant Agreement or grant: means a legal instrument of financial assistance between a Federal agency and a recipient or between a pass-through entity and a subrecipient, 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 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 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 of the Federal agency in carrying out the activity contemplated by the Federal award.
3. Does not include an agreement that provides only: Direct United States Government cash assistance to an individual; a subsidy; a loan; a loan guarantee; or insurance.  (UAR)

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)

H

HHS Grants Forecast (Forecast): an HHS-wide database in Grants.gov of planned competitive award opportunities developed for each fiscal year. The forecast contains actual or estimated dates and funding levels for competing funding opportunities that each awarding agency intends to issue during the upcoming fiscal year, subject to change based on enactment of Congressional appropriations. (WT)

High Risk:  a recipient with a history of subpar performance, financial instability, or inadequate management, placing them at risk of financial or operational failure. (HHS GPS)

Highest-level owner: means the entity that owns or controls an immediate owner of an applicant or that owns or controls one or more entities that control an immediate owner of an applicant. No entity owns or exercises control of the highest-level owner as defined in the Federal Acquisition Regulations (FAR) (48 CFR §52.204-17). (UAR)

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)

Hospital: means a facility licensed as a hospital under the law of any State or a facility operated as a hospital by the United States, a State, or a subdivision of a State. (UAR)

Human Subject: An individual from whom an investigator collects data via intervention, interaction, or acquisition of identifiable private information, including organs, tissues, body fluids, or any related graphic or recorded details. Regulations at 45 CFR Part 46 govern the use of human subjects. (HHS GPS)

I

Improper payment:  means a payment that should not have been made or that was made in an incorrect amount under statutory, contractual, administrative, or other legally applicable requirements. The term improper payment 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 is not authorized by law; and any payment that does not account for credit for applicable discounts. See OMB A-123 Appendix C, Requirements for Payment Integrity Improvement for additional definition and guidance on the requirements for payment integrity. (UAR)

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 2 CFR §200.306, Cost Sharing or matching. (WT)

Indian Tribe:  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)). This includes any Indian Tribe identified in the annually published Bureau of Indian Affairs list of Indian Entities Recognized and Eligible to Receive Services  and other entities that qualify as an Alaska Native village or regional village corporation as defined in or established pursuant to the Alaska Native Claims Settlement Act. (UAR)

Indirect Cost: means those 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. It may be necessary to establish multiple pools of indirect costs to facilitate equitable distribution of indirect expenses to the cost objectives served. Indirect cost pools must be distributed to benefitted cost objectives on basis that will produce an equitable result in consideration of relative benefits derived. For Institutions of Higher Education (IHE), the term facilities and administrative (F&A) costs is often used to refer to indirect costs. (UAR) 

See also 2 CFR §§200.1, 200.414, and 300.414.

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: means the documentation prepared by a recipient to substantiate its request to establish an indirect cost rate as described in appendix III through appendix VII, and appendix IX of 2 CFR Part 200. (UAR)

Information Technology Systems:  means computing devices, ancillary equipment, software, firmware, and related procedures, services (including support services), and resources. See also the definitions of computing devices and equipment. (UAR)

Institutional allowance: an amount paid to and administered by the sponsor institution to defray expenses for an individual fellow, such as supplies, equipment, travel to scientific meetings, and health insurance; and to otherwise offset, insofar as possible, appropriate administrative costs of training. (WT)

Institutional Review Board (IRB): a committee that safeguards the rights and well-being of human subjects in research. The IRB can approve, modify, or disapprove research activities under its jurisdiction. (HHS GPS)

Institutions of Higher Education (IHEs): is defined at 20 U.S.C. 1001. (UAR)

Intangible Property: means property having no physical existence, such as trademarks, copyrights, data (including data licenses), websites, IP licenses, trade secrets, patents, patent applications, and property such as loans, notes and other debt instruments, lease agreements, stocks and other instruments of property ownership of either tangible or intangible property, such as intellectual property, software, or software subscriptions or licenses. (UAR)

Intellectual Property: the separate and distinct types of intangible property that are referred to collectively as “intellectual property,” including but not limited to: Patents, trademarks, copyrights, trade secrets, SBIR technical data (as defined in this section), ideas, designs, know- how, business, technical and research methods, other types of intangible business assets, and all types of intangible assets either proposed or generated by a small business concern as a result of its participation in the SBIR Program (7 CFR §3403.2). (WT)

Interest rate swap: for purposes of 2 CFR §200.311, means 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. (WT)

Additional ACF Policy Clarification: ACF considers this type of rate high-risk and must be avoided.

Interim report: any financial or performance/progress report required to be submitted by a recipient on a periodic basis during a period of performance. This can be any report other than the final report. (WT)

Intermediate cost objective: means 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 the definitions of cost objective and final cost objective. (UAR)

Internal controls: for recipients and subrecipients means processes designed and implemented by recipients and subrecipients 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. (UAR)

International Organization: an organization with members from multiple countries, representing their interests, regardless of whether its headquarters or activities are located within or outside of the US. (HHS GPS)

Invention: a potentially patentable or protectable discovery or invention made by an awardee during work funded by a contract, grant, or cooperative agreement. The term "subject invention" refers to inventions specifically conceived or first reduced to practice as part of the funded work. (HHS GPS)

K

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

L

Land Improvements: a capital expenditure that includes, but is 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: is one under which one party to the lease agreement can control or substantially influence the actions of the other. Such leases include, but are not limited to, those between:

1. Divisions of the recipient or subrecipient;
2. The recipient or subrecipient and other entity under common control through common officers, directors, or members; and
3. The recipient or subrecipient and director, trustee, officer, or key personnel of the recipient or subrecipient or an immediate family member, either directly or through other corporations, trusts, or similar arrangements in which they hold a controlling interest. For example, the recipient or subrecipient may establish a separate corporation to own property and lease it back to the recipient or subrecipient.
4. Family members include one party with any of the following relationship to another party: spouse and parents thereof; children and spouses thereof; parents and spouses thereof; siblings and spouses thereof; grandparents and grandchildren and spouses thereof; domestic partner and parents thereof, including domestic partners of any individual noted above; and any individual related by blood or affinity whose close association with the employee is the equivalent of a family relationship. (UAR) 

For more information, see 2 CFR §200.465.

Letter of Intent: a preliminary, non-binding indication of an organization’s intent to apply. (WT)

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: means a Federal loan or loan guarantee received or administered by a recipient or subrecipient, 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 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 agency to make a loan guarantee when specified conditions are fulfilled by the borrower, the lender, or any other party to the guaranteed agreement. (UAR)

Local Government: means any unit of government within a State, including: 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. (UAR)

M

Maintenance and Repair Costs: These terms are not defined under the definitions section of the UAR; however, it is identified as a selected item of cost under the cost principles (Subpart E — Cost Principles). According to the general provisions (2 CFR §200.420), this section applies principles in determining costs and are in addition to the basic consideration requirements (2 CFR 200.402 -200.411) 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 cost. With that in mind, the maintenance and repair costs (2 CFR §200.452) 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 2 CFR §200.439).
3. These costs are only allowable to the extent not paid through rental or other agreements.

For more information, please see 2 CFR §§200.308, 200.407, 200.436, 200.439, 200.462,  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.

Maintenance of Effort: a statutory requirement where the recipient is required, as a condition of eligibility for federal funding, to maintain its financial contribution to the program at not less than a stated percentage (which may be 100 percent or less) of its contribution for a prior period, usually the previous fiscal year. (WT)

Major Program: means a Federal program determined by the auditor to be a major program in accordance with 2 CFR §200.518 or a program identified as a major program by a Federal agency or pass-through entity in accordance with 2 CFR §200.503(e). (UAR)

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. (WT)

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.

Additional ACF Policy Clarification:

Only ACF programs that have real property authority are allowed, with prior approval, to use federal funds for this and/or related purposes. 

Additional ACF Program-Specific Clarification:

• 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 purposes of 2 CFR §200.311 (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)

Additional ACF Policy Clarification:

For all other ACF programs (not identified under the major renovation definition), 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 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: means the Federal agency’s or pass-through entity’s written determination, provided to the auditee, of the adequacy of the auditee’s proposed corrective actions to address the findings based on its evaluation of the audit findings and proposed corrective actions. (UAR)

Merger: legal action resulting in the unification of two or more legal entities, which may invoke the need for a successor-in-interest if an HHS award is affected. (WT)

Merit Review: an objective process of evaluating Federal award applications in accordance with the written standards of the Federal agency. This review is an unbiased evaluation of discretionary applications by experts in the relevant field. Also known as objective review. (HHS GPS)

Micro-purchase: means an individual procurement transaction for supplies or services, the aggregate amount of  which does not exceed the micro-purchase threshold. Micro-purchase comprise a subset of a recipient’s or subrecipient’s small purchase procedures using informal procurement methods as set forth in 2 CFR §200.320. (UAR)

Micro-purchase threshold: means the dollar amount at or below which a recipient or subrecipient may purchase property, or services using micro-purchase procedures (see 2 CFR §200.320). Generally, except as provided in 2 CFR §200.320, the micro-purchase threshold for procurement activities administered under Federal awards is not to exceed the amount set by the FAR at 48 CFR part 2, subpart 2.1, unless a higher threshold is requested by the recipient or subrecipient and approved by the cognizant agency for indirect costs. (UAR)

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

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

1. Complies with federal regulations (i.e., 2 CFR §§200.407, 200.439, 200.462) 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.

Modified Total Direct Cost (MTDC): 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. (UAR) 

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 or subrecipient 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)

Additional ACF Policy Clarification: Equipment intended to be “fixed” rather than “moveable”, must be classified as real property. See 2 CFR §200.1 for real property and equipment definitions, 45 CFR §98.2  , 45 CFR §1305.2  , HHS GPS, any program-specific guidance, and the non-federal entities accounting procedures. Depending on the classification, please see the relevant reporting and disposition guidance.

Monitoring: a method of evaluating an award’s programmatic and business management performance using data from reports, audits, site visits, and other sources. (HHS GPS)

Mortgage: for purposes of 2 CFR §200.311, 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. (WT)

Additional ACF Policy Clarification: This document is an encumbrance, which requires ACF prior approval via an exception request. 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 2 CFR §200.308, 2 CFR §200.311, any program-specific guidance, 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-discretionary Award: means an award made by the Federal agency to specific recipients in accordance with statutory, eligibility, and compliance requirements, such that in keeping with specific statutory authority, the Federal agency cannot exercise judgement (“discretion”). A non-discretionary award amount could be specifically determined or by formula. (UAR)

Non-Federal Entity (NFE): means 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. (UAR)

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 2 CFR §200.307) 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. (WT)

Nonprofit Organization: means any organization that: is operated primarily for scientific, educational, service, charitable, or similar purposes in the public interest; is not organized primarily for profit; uses net proceeds to maintain, improve, or expand the operations of the organization; and is not an IHE. (UAR)

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 2 CFR §§200.311 and 200.316, 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):  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. (UAR)

O

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

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

Open-end mortgage: for purposes of 2 CFR §200.311, 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. (WT)

Additional ACF Policy Clarification: 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.

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"). (WT)

Oversight Agency for Audit: means the Federal agency that provides the predominant amount of funding directly (direct funding) (as listed on the schedule of expenditures of Federal awards, see 2 CFR §200.510(b)) to a recipient or subrecipient unless OMB designates a specific cognizant agency for audit. When the direct funding represents less than 25 percent of the total Federal expenditures (as direct and sub-awards) by the recipient or subrecipient, then the Federal agency with the predominant amount of total funding is the designated oversight agency for audit. When there is no direct funding, the Federal agency that 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 2 CFR §200.513(b). (UAR)

P

Parcel: for purposes of 2 CFR §§200.311 and 200.465, 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. 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. (WT)

Participant: means an individual participating in or attending program activities under a Federal award, such as trainings or conferences, but who is not responsible for implementation of the Federal award. Individuals committing effort to the development or delivery of program activities under a Federal award (such as consultants, project personnel, or staff members of a recipient or subrecipient) are not participants. Examples of participants may include community members participating in a community outreach program, members of the public whose perspectives or input are sought as part of a program, students, or conference attendees. (UAR)

Note: In the preamble to 2 CFR 200, OMB states “The definition of participant and participant support costs in this guidance is not intended to include beneficiaries.”

Participant Support Costs: means direct costs that support participants (see definition for participant) and their involvement in a Federal award, such as stipends, subsistence allowances, travel allowances, registration fees, temporary dependent care, and per diem paid directly to or on behalf of participants. (UAR)

Note: In the preamble to 2 CFR 200, OMB states “The definition of participant and participant support costs in this guidance is not intended to include beneficiaries.”

Pass-Through Entity: means a recipient or subrecipient that provides a subaward to a subrecipient (including lower tier subrecipients) to carry out part of a Federal program. The authority of the pass-through entity under this part flows through the subaward agreement between the pass-through entity and subrecipient. (UAR)

Patent: A property right awarded by the federal government that grants the right to exclude others from making, using, or selling the invention for a period of years. (HHS GPS)

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

Performance Goal: means a measurable 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 (for example, discretionary research awards), this may be limited to the requirement to submit technical performance reports (to be evaluated in accordance with agency policy). (UAR)

Period of Performance: means the time interval between the start and end date of a Federal award, which may include one or more budget periods. Identification of the period of performance in the Federal award consistent with 2 CFR §200.211(b)(5) does not commit the Federal agency to fund the award beyond the currently approved budget period. (UAR)

Personal Property: means property other than real property. It may be tangible or intangible. (UAR)

Personally Identifiable Information (PII): 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 PII is available in public sources such as telephone books, websites, and university listings. The definition of PII is not attached to any single category of information or technology. Instead, 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 could be used to identify an individual when combined with other available information. (UAR)

Pre-Award Costs: Costs incurred before the official start date of an award in anticipation of the Federal award where such costs are necessary for efficient and timely performance of the scope of work. These costs are only allowable with prior approval of the agency, unless waived by expanded authority. (HHS GPS)

Prepayment clause: for purposes of 2 CFR §§200.311, 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 purposes of 2 CFR §§200.311, 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):  the individual (s) designated by the recipient to direct the project or program being supported by the award. The PI/PD is responsible and accountable to officials of the recipient organization for the proper conduct of the project, program, or activity. (HHS GPS)

Prior Approval: means the written approval obtained in advance by an authorized official of a Federal agency or pass-through entity of certain costs or programmatic decisions. (UAR)

Program Income: means gross income earned by the recipient or subrecipient 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 2 CFR §200.307(c). Program income includes but is not limited to income from fees for services performed, the use or rental of 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 2 CFR §200.407. See also 35 U.S.C. 200-212 “Disposition of Rights in Educational Awards,” which applies to inventions made under Federal awards. (UAR)

Progress Report: Regularly submitted reports, typically annually, from the recipient to the agency to evaluate progress and determine funding for the next budget period, excluding the final report. (HHS GPS)

Project Costs: means total allowable costs incurred under a Federal award and all cost sharing, including third-party contributions. (UAR)

Promissory Note: (Also called notes.) for purposes of 2 CFR §§200.311, 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. (WT)

Additional ACF Policy Clarification: This document is a part of encumbrance, which requires ACF 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. 

Property: means real property and personal property. See definitions. (UAR)

Protected Personally Identifiable Information (Protected PII): means PII (see definition in this section), except for PII that must be disclosed by law. Examples of PII include, but are 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; and educational transcripts. (UAR)

Purchase: for purposes of 2 CFR §§200.311, means to buy a property. (WT)

Additional ACF Policy Clarification: Only ACF programs that have real property authority are allowed, with prior approval, to use federal funds for this and/or related purposes. 

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.

Additional ACF Program-Specific Clarification:

• For OHS recipients and subrecipients: 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." (45 CFR §1305.2 )
• 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).

Q

Questioned Cost: has the meaning given in paragraphs (1) through (3).

(1) Questioned cost means an amount, expended or received from a Federal award, that in the auditor's judgment: (i) Is noncompliant or suspected noncompliant with Federal statutes, regulations, or the terms and conditions of the Federal award; (ii) At the time of the audit, lacked adequate documentation to support compliance; or (iii) Appeared unreasonable and did not reflect the actions a prudent person would take in the circumstances.

(2) The questioned cost amount under (1)(ii) is calculated as if the portion of a transaction that lacked adequate documentation were confirmed noncompliant.

(3) There is no questioned cost solely because of: (i) Deficiencies in internal control; or (ii) Noncompliance with the reporting type of compliance requirement (described in the compliance supplement) if this noncompliance does not affect the amount expended or received from the Federal award.

(4) Known questioned cost means a questioned cost specifically identified by the auditor. Known questioned costs are a subset of likely questioned costs.

(5) Likely questioned cost means the auditor's best estimate of total questioned costs, not just the known questioned costs. Likely questioned costs are developed by extrapolating from audit evidence obtained, for example, by projecting known questioned costs identified in an audit sample to the entire population from which the sample was drawn. In evaluating the effect of questioned costs on the opinion on compliance, the auditor considers the likely questioned costs, not just the known questioned costs.

(6) Questioned costs are not improper payments until reviewed and confirmed to be improper payments as defined in OMB Circular A-123 Appendix C. (UAR)

R

Real Property: means land, including land improvements, structures, and appurtenances, and legal interests in land, including fee interest, licenses, rights of way, and easements. Real property does not include moveable machinery and equipment. (HHS GPS)

Additional ACF Policy Clarification: 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 Applicable ACF Programs with Real Property Authority, generally accepted accounting principles (GAAP), HHS GPS, and definitions.

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. (WT)

Recipient: means an entity that receives a Federal award directly from a Federal agency to carry out an activity under a Federal program. The term recipient does not include subrecipients or individuals that are participants or beneficiaries of the award. (UAR)

Reimbursement: A payment made to a recipient upon its request after it makes cash disbursements. (HHS GPS)

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

Repair: See Maintenance and Repair Costs.

Research: the systematic study directed toward fuller scientific knowledge or understanding of the subject studied. This includes activities involving the training of individuals in research techniques where such activities use the same facilities as other research and development activities and where such activities are not included in the instruction function. (HHS GPS)

Research and Development (R&D): means all basic and applied research activities and all development activities performed by a recipient or subrecipient. The term research also includes activities involving the training of individuals in research techniques where such activities use the same facilities as other research and development activities and where such activities are not included in the instruction function. “Research” is the 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 to produce useful materials, devices, systems, or methods, including designing and developing prototypes and processes. (UAR)

Right of Setoff: for purposes of 2 CFR §§200.311, 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. (WT)

Additional ACF Policy Clarification: Federal funds cannot be used to satisfy this clause.

S

Security accounts: See Right of Setoff. (WT)

Security Agreement: for purposes of 2 CFR §§200.311, 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. (WT)

Additional ACF Policy Clarification: Federal funds cannot be used to satisfy this clause.

Setoff Provision: See Right of Setoff. (WT)

Short-term loan: for purposes of 2 CFR §§200.311, when used in connection with an encumbrance request, is a debt instrument that has a maturity date of less than 15 years. (WT)

Additional ACF Policy Clarification: ACF may not consider short-term loans.

Significant Rebudgeting: a threshold that is reached when expenditures in a single direct cost budget category deviate from the approved budget amount for that budget category and budget period by 10 percent of the total budget last approved by the HHS awarding agency, and the federal share exceeds the simplified acquisition threshold. Significant rebudgeting is an indicator of a potential change of scope. A threshold that is reached when the cumulative changes between direct cost categories reaches an established percentage of total award amount.  (WT)

Simplified Acquisition Threshold: means the dollar amount below which a recipient or subrecipient may purchase property or services using small purchase methods (see § 200.320 ). Recipients and subrecipients adopt small purchase procedures to expedite the purchase of items at or below the simplified acquisition threshold. The simplified acquisition threshold set in the FAR at 48 CFR part 2, subpart 2.1 is used in this part as the simplified acquisition threshold for secondary procurement activities administered under Federal awards. The recipient or subrecipient is responsible for determining an appropriate simplified acquisition threshold, which is less than or equal to the dollar value established in the FAR, based on internal controls, an evaluation of risk, and its documented procurement procedures. Recipients and subrecipients should also determine if local government purchasing laws apply. This threshold must never exceed the dollar value established in the FAR. (UAR)

Additional ACF Policy Clarification: 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 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: means equipment that is used only for research, medical, scientific, or other similar technical activities. Examples of special purpose equipment include microscopes, x-ray machines, surgical instruments, spectrometers, and associated software. See also the definitions of equipment and general purpose equipment. (UAR)

State: means 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. (UAR)

Stipend: A payment made to an individual to help that individual’s subsistence expenses during the period of training. Stipends are not salary and should not be provided as a condition of employment with either the federal Government or the recipient/sub- recipient organization. (WT)

Subaward: means an award provided by a pass-through entity to a subrecipient for the subrecipient to contribute to the goals and objectives of the project by carrying out part of a Federal award received by the pass-through entity. It does not include payments to a contractor, beneficiary, or participant. A subaward may be provided through any form of legal agreement consistent with criteria in with 2 CFR §200.331, including an agreement the pass-through entity considers a contract. (UAR)

Subordination: for purposes of 2 CFR §§200.311, 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. (WT)

Additional ACF Policy Clarification: ACF may consider subordinations, but only as a last resort. Recipient (and on behalf of subrecipients) must show their due diligence with avoiding a subordination.

Subordination Agreement: for purposes of 2 CFR §§200.311, when used in connection with an encumbrance request, is a written agreement among the Federal agency, the recipient, and the Lender in which the Federal Government agrees to subordinate its interest in the real property (not the personal property) to the Lender; and the Lender grants the Federal Government certain rights, such as an opportunity to cure in the event the recipient defaults. (WT)

Additional ACF Policy Clarification: ACF may consider subordinations, but only as a last resort. Recipient (and on behalf of subrecipients) must show their due diligence with avoiding a subordination.

Subrecipient: means an entity that receives a subaward from a pass-through entity to carry out part of a Federal award. The term subrecipient does not include a beneficiary or participant. A subrecipient may also be a recipient of other Federal awards directly from a Federal agency. (UAR)

Subsidiary: means an entity in which more than 50 percent of the entity is owned or controlled directly by a parent corporation or through another subsidiary of a parent corporation. (UAR)

Substantive programmatic work: The primary project activities for which award support is provided. (HHS GPS)

Supply/Supplies: 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. (HHS GPS) 

See definitions for computing devices and equipment. See Tangible Personal Property Guidance.

Surplus Property: See Excess property.

Suspending Award Activities: A temporary halt on a recipient's ability to use award funds until they take corrective action as directed by the agency or until the agency decides to end the award. This definition of "suspension" is distinct from its use in the context of debarment and suspension procedures. (HHS GPS) .

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. (WT)

T

Tangible Personal Property: Tangible assets including equipment and supplies, excluding intangible property like intellectual property. (HHS GPS) See Tangible Personal Property Guidance.

Telecommunication Cost: means the cost of using communication technologies such as mobile phones, landlines, and the internet. (UAR)

Termination: means the action a Federal agency or pass-through entity takes to discontinue a Federal award, in whole or in part, at any time before the planned end date of the period of performance. Termination does not include discontinuing a Federal award due to a lack of available funds. (UAR)

Terms and Conditions of Award: all requirements of the award or subaward, whether in statute, regulations or the award document. The terms and conditions are legally enforceable and may be referenced or specified in the full text of the NoA and/or the HHS GPS. (WT)

Total Costs: The sum of the allowable direct and indirect costs minus any applicable credits. (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. (WT)

Unliquidated Financial Obligations: means financial obligations incurred by the recipient or subrecipient but not paid (liquidated) for financial reports prepared on a cash basis. For reports prepared on an accrual basis, these are financial obligations incurred by the recipient or subrecipient but for which expenditures have not been recorded. (UAR)

Unobligated Balance: means the amount of funds under a Federal award that the recipient or subrecipient has not obligated. The amount is computed by subtracting the cumulative amount of the recipient's or subrecipient's unliquidated financial obligations and expenditures under the Federal award from the cumulative amount of funds the Federal agency or pass-through entity authorized the recipient or subrecipient to obligate. (UAR)

V

Variable interest rates: for purposes of 2 CFR §§200.311, when used in connection with an encumbrance request, is an interest rate that can change over the course of the term of the loan. (WT)

Additional ACF Policy Clarification: 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.

Voluntary committed cost sharing: means cost sharing specifically pledged voluntarily in the proposal's budget on the part of the recipient or subrecipient, which becomes a binding requirement of the Federal award. See 2 CFR §200.306. (UAR) 

W

Withholding of Cash Payment: the agency, after following necessary steps, limits a recipient's access to funds until they make the needed corrections. (HHS GPS)

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