1 Reporting Requirements under ARRA and Beyond Merril Oliver [email protected] Maryland...

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Reporting Requirements under ARRA and Beyond

Merril [email protected]

Maryland Governor’s Grants Office www.grants.maryland.gov

Developed in partnership with

Liz Johnson [email protected]

Federal Funds Information for States www.ffis.org

September 18, 2009

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Presentation Overview

Reporting requirements definitions and history Federal Funding Accountability and Transparency

Act (FFATA) American Recovery and Reinvestment Act (ARRA)

– Statute & OMB guidance– Reporting processes & time frame– Federal agency-specific guidance

Challenges to states in implementing ARRA reporting requirements

How FFATA requirements will impact states in future and what can be done about it now

Experiences from Maryland

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Key Reporting Definitions

Prime Recipient – non-federal entities that receive funding awards directly from the federal government.

– States– Localities

Subrecipient – non-federal entity that receives federal award funding through another non-federal entity, to carry-out a federal program

– Does not include individual program beneficiaries or vendors– Localities can be prime or subrecipients depending on awards.

Vendor – a dealer, distributor, merchant, or other seller providing goods or services for the conduct of a federal program. Do not participate in substantive work of program. Provide the same type of services to many different purchasers.

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Reporting Requirements: History of FFATA

On September 26, 2006, FFATA enacted (P.L. 109-282)– Sponsored by then-Sen. Obama and Sen. Coburn– Purpose was to increase transparency of federal funding awards

(grants, loans, cooperative agreements, contracts & credit card transactions) through creation of a publicly available online database that includes information on all entities receiving federal funds – www.usaspending.gov

– Differentiated between primary non-federal entity to receive award and subsequent subawards

More details can be found in FFIS Issue Brief 08-58 (http://ecom.ncsl.org/ffis/subs/ib/2008/IB08-58.pdf) and 09-16 (http://ecom.ncsl.org/ffis/subs/ib/2009/IB09-16.pdf)

Link to legislation: http://frwebgate.access.gpo.gov/cgi- bin/getdoc.cgi?dbname=109_cong_public_laws&docid=f:publ282.109

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Reporting Requirements: History of FFATA (2)

FFATA laid out required data elements for primary award reports (See Table)

– As of January 1, 2008, federal agencies report on prime awards in www.usaspending.gov

– Data is incomplete, contains many errors FFATA legislated OMB to conduct a pilot program for

determining subaward reporting requirements and procedures– Under FFATA, prime recipients are required to report on

subawards In subsequent guidance, OMB directed subrecipients to obtain

DUNS numbers and register in the Central Contractor Registration (CCR)

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FFATA Subaward Pilot

Pilot occurred in November, 2008. Analysis of pilot completed, but release of

information currently on hold.

“These pilots did not generate sufficient information on which to base an operational model or project plan for how subaward information should be collected. They also did not generate sufficient information on which to base an accurate assessment of the burden placed on award recipients.”

Peter Orzag, Director of OMB, April 27, 2009

Reporting deadline for subawards, set as January 1, 2009, in FFATA was not met. OMB has authority to extend 18 months = July 1, 2010.

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FFATA: On Hold for Now, but Reporting Will Occur in Future

FFATA requirements put on back burner to accommodate for ARRA

However, as ARRA funding is distributed and the reporting process smoothed-out, FFATA requirements will eventually be implemented and recipients will need to comply.

– FFATA bill sponsor, Tom Coburn, already concerned that FFATA has been put on hold

– Link to letter – http://tinyurl.com/o2jzpg -- includes link to OMB’s response

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Why was FFATA put on hold?

ARRA legislated ….. Contained numerous provisions on transparency and

reporting – A list of all provisions related to reporting requirements in

ARRA can be found in addendum

Recipient reporting requirements contained in ARRA Section 1512(c)

Implementing Guidance has been released by OMB

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ARRA Section 1512(c) – Recipient Reporting Requirements

The bill requires all recipients of recovery funds (grants, loans, and contracts) from a federal agency to report the following:

Total amount of recovery funds received from the agency. Amount of funds expended or obligated to projects A detailed list of all projects for which recovery funds were expended,

including: – The name and description of the project. – An evaluation of the completion status of the project. – An analysis of the number of jobs created or retained by the

project. Detailed information on any subcontracts or subgrants, including data

elements required by the Federal Funding Accountability and Transparency Act of 2006 (Public Law 109-282).

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ARRA Recipient Reporting Requirement Parameters

Applies only to programs in Division A of ARRA, not to mandatory, tax programs, or programs in Division B such as trade adjustment assistance, UI, broadband, TANF emergency contingency funding, and premium assistance for COBRA.– List of all program subject to section 1512 (c)

reporting requirements is supplement to OMB guidance M-09-21

– http://www.whitehouse.gov/omb/assets/memoranda_fy2009/m09-21-supp1.pdf

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ARRA Reporting Guidance - OMB

Reporting requirements implemented by OMB

guidance, M-09-21, released June 22, 2009:www.whitehouse.gov/omb/recovery_default/

Clarifications and FAQs on guidance:http://www.recovery.gov/?q=content/recipient-reporting

(A list of all OMB guidance on ARRA reporting requirements is included in addendum to this presentation)

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What does OMB Guidance Include?

Definition of prime recipients, subrecipients and vendors– In ARRA, subrecipient requirements apply only to “first-tier”

subrecipients Description of prime recipient responsibilities

– Ultimately responsible for data -- quality, completeness, timeliness – Data reviews and monitoring procedures – Centralized or decentralized reporting options– Can delegate reporting to subrecipients or not– Cannot delegate reporting to vendors

Required Data Elements Details on how to submit reports Deadlines and timeframe

For more detailed information, see FFIS Issue Brief 09-24 at http://www.ffis.org/452501/497155.html

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ARRA Reporting Tree

Prime Recipient

Vendor subrecipient

Vendor

Federal Agency

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ARRA Data Elements

See Table

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Jobs Data

Number on jobs created or retained =

Total hours worked in jobs created or retained # hours in full time schedule

– Prime recipients must aggregate jobs data from subrecipients and vendors

– Only report on jobs directly funded by ARRA monies, not indirect or induced jobs.

– “Employees who are not directly charged to Recovery Act supported projects/activities, who, nonetheless, provide critical indirect support, e.g., clerical/administrative staff preparing reports, institutional review board staff members, departmental administrators, are NOT counted as jobs created/retained.” OMB guidance, M-09-21, p.36

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Submitting ARRA Reports

Registration at www.federalreporting.gov began on August 17, 2009

Three methods for submitting reports– Directly online at www.federalreporting.gov– Excel template – Custom software system extraction in XML

Excel template and XML schema available for download at https://www.federalreporting.gov/federalreporting/downloads.do

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How to Find Help Submitting Reports?

Reference documents available for downloading, including registration guide and data model, at federalreporting.gov

Federalreporting.gov has a list of FAQs Service desk – currently open from 9am-5pm Mon.-Fri.,

will be open around the clock during October 877-508-7386 or email at [email protected] Information provided directly in Excel report template. Federal liaison in each state from end of September -

October

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Quarterly Deadlines and Timeframe

Timeframe for report submission and correction. Days refer to days following the end of each quarter:

Days 1-10: prepare and submit data Days 11-21: Review and correct submitted data. Federal

agencies in “view-only” mode. Days 22-29: Federal agencies review data, ask questions,

“unlock” data for recipient edits. Day 30: Data released to public on recovery.gov

Mistakes that are caught after the 30th day can be corrected in next quarterly report.

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How will ARRA reports be used?

Will be posted on www.recovery.gov

Will be posted on Federal Agency websites– Not clear if all elements reported on federalspending.gov will

be posted for public

State websites– Links to all state website available at:http://www.recovery.gov/?q=content/state-local-tribal-and-territorial-resources&mode=map

– Analysis and ranking of state websites available from Good Jobs First at: http://www.goodjobsfirst.org/news/article.cfm?id=396

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What Happens If My State Does Not Comply?

“Federal awards, like most legal contracts, are made with stipulations outlined in the award’s term and conditions. Non-compliance with the reporting requirement as established under section 1512 of the Recovery Act is considered a violation of the award agreement because awards made with Recovery funds have a specific term requiring such compliance.” OMB Guidance M-09-21, p.17

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Agency-Specific ARRA Reporting Guidance

Additional agency-specific guidance will also be released.

“…outside of Section 1512 of the Recovery Act…

recipients will have to comply with any reporting as outlined in the award agreement. In these areas, recipients should rely on program-specific guidance and instructions issued by the relevant federal agency.

Thus, it is anticipated that federal agencies will, as appropriate, issue clarifying guidance to funding recipients. Additional guidance for Recovery funding recipients must be in accordance with OMB guidance.”

- OMB Guidance, M-09-21, June 22, 2009. p.6

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Agency-Specific ARRA Reporting Guidance (2)

Guidance that has been released to date not extensive, not posted centrally for easy access:

– Department of Labor, Employment and Training Administration guidance includes requirement for hard copy of reporting info for June 30, 2009. http://wdr.doleta.gov/directives/corr_doc.cfm?docn=2793

– TEFAP guidance summarizes parts of OMB memo that altered previously released guidance or impose new reporting requirements. http://www.fns.usda.gov/fns/recovery/memos/TEFAP_080309.pdf

– National School Lunch Program guidance. http://www.fns.usda.gov/cnd/Governance/Policy-Memos/2009/SP_36-2009_os.pdf

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Challenges to States from Agency-Specific ARRA Guidance

No deadlines exist for release of agency guidance. States may need to adjust “after the fact”

Information flow will be difficult, as there is no central hub listing all agency guidance across federal government.

Agency use of information– “Federal agencies may use recipient reports to help assess

compliance with the terms and conditions of the individual award agreements, further assess risks and to determine when to release the remaining funds.”

OMB Guidance, M-09-21, June 22, 2009. p.26

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Prime Recipient Responsibilities under ARRA Pose Challenges to States

Prime recipients are ultimately responsible for accurate, complete, and timely submission of data.

OMB states that prime recipients should develop internal controls to ensure data quality.

Prime recipients may require subrecipients to self-report, but must develop system to check data and monitor process to ensure no duplicate reporting.

Prime recipients must review data after report submission deadline. Look for material omissions and significant reporting errors.

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Benefits and Challenges to Centralized or Decentralized Approach?

Prime recipients and must also adapt to the reporting approach taken by the state. Each approach has pros/cons:

Centralized approach – single state agency or office (budget office, Governor’s office) collects prime recipient data from all state agencies and then reports into federalreporting.gov itself

Decentralized approach – no single point of entry for submitting required data to FederalReporting.gov. Allows for multiple parties at the prime recipient level to enter data

– States must develop process to ensure that multiple agencies do not inadvertently create separate data records reporting on the same activity

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ARRA Reporting Requirements Pose Challenges for States

Reconciliation with other financial reports could become very difficult

Subaward reporting will bring out need for closer monitoring of subrecipients

New breadth and depth of data may have audit implications

Registering on CCR may lead to violations of internal controls

States may need to better manage and use DUNS numbers

And more…..

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DUNS Issues1. DUNS Tree needs to continuously updated and managed 2. Under D&B policies, there is no ability to delete records that

don’t belong in the State’s DUNS family tree. As a result, there is the potential for registrations to the CCR and FederalReporting.gov that will be inappropriately associated with the State.

3. There is no process by which an entity such as a state can restrict assignment of DUNS to the parent DUNS number or remove an entity that has been inappropriately associated with the state.

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CCR Issues1. CCR allows registration in its database if the registrant can provide a

valid DUNS number, but it does not require evidence that the registrant is a valid member of the parent DUNS family tree. This will require extra diligence on State’s to manage CCR registrations and have some form of centralized CCR report.

2. State’s have been unable to obtain a report of registrations in the CCR database that are associated with the state’s primary government.

3. In general, CCR registration compromises internal controls by providing access to banking information to personnel outside the “control” environment. This has been an ongoing issue and should be made note of in any grant file to reduce the audit finding impact.

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FederalReporting.gov Issues1. A Central Submitter (CS) registers on FedRpt.gov

and associates themselves with another DUNS number by requesting an FRPIN, FedRpt.gov system automatically notifies the “owner” of that DUNS number and the owner has the option to reject the CS.

2. IF the CS is rejected or revoked at anytime, they are rejected from reporting for the ENTIRE Duns tree

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ARRA and Federal Transparency

Perhaps the biggest consequence of ARRA reporting requirements is that they will set the stage for more permanent reporting requirements, as legislated by FFATA

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When ARRA winds down, FFATA will wind up

“Once subaward reporting capabilities are in place for Recovery Act funds and these data are displayed on Recovery.gov, the Administration intends to begin broadening subaward report requirements to all Federal funding, to comply with the Transparency Act.” Peter Orzag, Director of OMB, April 27, 2009

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A few details on FFATA and how it differs from ARRA

Subaward reporting requirements are not limited to first-tier subrecipients in FFATA, as they are in ARRA

Data is reported monthly, not quarterly as for ARRA Experiences of pilot participants indicate that states

have significant capacity issue. – Large gaps in information collected from subrecipients– Data quality issues

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State Implications of FFATA Requirements

FFATA has more frequent reporting deadlines– Currently stands that primes would have to report on awards to

subrecipients within 30 days of obligation– Talk of possibly having “real time” reporting

When FFATA requirements are enforced, states will have to report much further down the line on funds distributed.

– Not limited to first-tier sub-recipients

Subrecipient data may be more extensive than under ARRA– FFATA states that subrecipient reporting should be done in the same

manner as prime recipient reporting– Whereas ARRA has fewer reporting requirements for subrecipients than

prime recipients, this may not be the case with FFATA requirements.

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State Implications of FFATA Requirements (2)

It is likely that the reporting processes and procedures for FFATA will mirror those being set-up for ARRA

– Centralized or decentralized options among states – with one central portal for submitting data

May be influenced by state experiences under ARRA

– Option to delegate reporting requirements to subrecipients is possible (although view on this was only about 50-50 in pilot)

– Data quality controls and review procedures will likely hold

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Where do states go from here?

Building on ARRA for future grants reporting– Recovery Act data system set-up in a way that

would accommodate more comprehensive reporting.

Will states be able to incorporate FFATA requirements into structures / processes developed during ARRA reporting?

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Experiences in Maryland

Centralized Governor’s Grants Office www.grants.maryland.gov

– Increase and Track all Federal grant dollars coming to Maryland to support Governor O’Malley’s policy priorities.

– Deliver Comprehensive Training Program for State, Local, Municipal Gov’t, Non-profit and Ed Sectors

Train for Pre- and Post-award grants management– FFATA Reporting Requirements training delivered 2006

Train for ARRA opportunities, preparation, implementation, reporting delivered spring 2009

Track Single Audit Findings– Offer training targeted to audit finding reduction

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Governor O’Malley’s State Stat Program www.statestat.maryland.gov

– Accurate & timely intelligence, shared by all – Rapid deployment of resources – Effective tactics and strategies – Relentless follow-up and assessment

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Governor O’Malley’s Recovery Program www.recovery.maryland.gov

– Recovery Main– State Funding Overview – Detailed Map of MD Spending – Search Grants, Contracts and Loan

Opportunities – Centralized ARRA Reporting

1 Reporting Requirements under ARRA and Beyond Merril Oliver [email protected] Maryland...

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