Agricultural Research, Extension and Education Reform Act

(AREERA)

Program and Administrative Update

May 25, 2011

AGENDA:

• AREERA OVERVIEW;• INTERIM GUIDANCE STATUS UPDATE;• DECISIONS BASED ON STAKEHOLDERS’

COMMENTS;• REVISED TIMELINE; AND• ADMINISTRATIVE GUIDANCE

AREERA OVERVIEW:• AREERA, Public Law 105–185, was passed in 1998;• Was last amended in December 2009, Public Law

111–122;• USDA OIG Audit Report no. 13001-3-Te, August

2004;• Resolving three existing open Audit

Recommendations – correctly determining base percentages, implementing a verification process for hardship requests; and revising and integrating FAQs on split appointments to conform with regulations.

INTERIM GUIDANCE STATUS UPDATE:• Interim Guidance is effective as of August 12, 2010 until Final Guidance is

published in 2012.• The establishment of the new target percentages are effective for fiscal

year 2011, NIFA/OGFM approval is forthcoming. • Final Guidance will include program related issues; financial process

issues will be included in the comprehensive NIFA/OGFM Policy Guidance Manual scheduled for release in 2012.

• Formula Terms and Conditions will be presented in 2011.• NIFA/OGFM path forward is to ensure that program and financial

guidance is included in one of the following documents: Regulations; Terms and Conditions; and/or the Policy Guidance Manual.

DECISIONS BASED ON STAKEHOLDERS’ COMMENTS:• We will revise the NIFA-REPT form to include certification and signature

for both research and extension Directors.

• We will clarify the comingling language so that it is consistent with the existing guidance provided in the Standards for financial management systems language at 7 CFR 3019 (related excerpt below).– Accurate, current and complete disclosure of the financial results of

each federally-sponsored project or program.– Records that identify adequately the source and application of funds

for federally-sponsored project.– Comparison of outlays with budget amounts for each award.– Accounting records including cost accounting records that are

supported by source documentation.

REVISED TIMELINE

• 8/12/2010, Administrative Guidance for Multistate Extension Activities and Integrated Research and Extension Activities will remain in effect until final guidance issuance.

• Release of Final Guidance will occur in calendar year 2012 as part of a broader Policy Guidance Manual.

AREERA - Section 105 & 204Compliance

Session 45 – WednesdayMay 25, 2011

Brenda Barnett

Branch Chief, Formula Grants

Administrative Guidance

• Certification is required by the land-grant institutions (LGI) of expenditures of formula grant funds used to meet the requirements of the Agricultural Research, Education, and Extension Reform Act of 1998 (AREERA).

• Actual Expenditures of Federal Funding for Multistate Extension and Integrated Activities (NIFA-REPT)

• Revised report designed so that each institution will submit only one form with attached brief summaries for each fiscal year (FY) of funding.

Administrative Guidance• The new form allows for reporting on all three AREERA requirements.

• Includes a certification statement as recommended by USDA OIG.

• Form should be submitted for each fiscal year of funding.

• Due by April 1st following the close of the Federal FY.

• Extension of time for reporting may be granted with a written or email request.

• Must be signed and dated by either the Research or Extension Director, or both if desired.

Administrative Guidance• Must include brief summaries to support titles of planned program activity.

– Providing brief summaries for Multistate and Integrated activities highlights those activities listed on the NIFA-REPT form, and allows NIFA to tie the amounts you listed on the expenditure report to specific activities.

– Brief summaries are a small paragraph description of the titles of the planned program activity listed for that FY of funding.

• Expenditures reported are matched against the results received from multiplying the target percentage and the applicable FY allocation (e.g. target percentage times FY allocations which includes:– Hatch Regular and Hatch MRF (Integrated Activities)– Smith Lever only (Integrated Activities and Mulitstate Extension)

CarryoverMultistate Extension and Integrated Activities• Requirements

– 1-year carryover period for Hatch Act funds– 4-year carryover period for Smith-Lever Act funds, for a total award

length of 5 years

• Possibility exists that an AREERA requirement may not be completed for a FY until the following or subsequent FY. Interim Report should be filed.

Please note carry-over limitations apply to the requirements (e.g. Integrated Hatch funds must be achieved within a 2-year period, Smith Lever – 5-years).

• “Excess” not regular carry-over balances will be reported and the LGI will be contacted and given the opportunity to either confirm the excess carryover or submit a revised NIFA-REPT form within 60 days of notification.

CarryoverMultistate Extension and Integrated Activities

• If it is confirmed the excess carryover exists, after a final NIFA-REPT is submitted, funding will be reduced in the appropriate fund.

• Any carryover reported on NIFA-REPT will be tracked to ensure that Multistate Extension and Integrated requirements are met for each FY of funding.

• Failure to submit the NIFA-REPT will result in 4th quarter FY funds being placed “on hold”.

• Extensions of time for reporting may be granted with a written or email request.

AREERA WaiversHatch Regular & Hatch Multistate

• AREERA (Section 105 & 204 Compliance)– Research or Extension Director may submit a letter to the

NIFA Director requesting a waiver.– All LGI’s should submit a request for waiver as soon as it

is recognized that the State will be unlikely to satisfy the matching requirement.

– Post waivers require LGI’s to provide an explanation and justification as to why the request was not made in the appropriate FY.

AREERA Waiver - Criteria

• Criteria for waiver approval:

– Natural Disaster, flood, fire, tornado, hurricane, or drought;

– State/institution facing a financial crisis; and/or;

– Other similar circumstances.

AREERA Waiver Request

• Waiver requests must indicate the name of institution, type of request (i.e., multistate extension or integrated), appropriate FY, the basis for request (i.e., one or more of criteria), supporting justification, back-up documentation (i.e., newspaper articles and/or clippings; State budget projects), and amount.

• NIFA will notify the institution if additional documentation is required, and if the request has been approved or denied.

• Reminder….For post waivers, institutions must provide an explanation and justification as to why request was not made in appropriate FY.

AREERA Waiver Request

• All waivers are approved by NIFA Director.

• If possible, waiver requests will be processed in 60 days.

AREERA FY 2010 Review• Reports

– Received 44 out of 53 land-grant institution reports to date.• LGI’s who have not submitted the FY 2010 NIFA-REPT, will have

their FY 2011 4TH quarter funds placed “on-hold”;

• Attach brief summaries; • Incorrect allocations;• Reporting “target level” spending• Waivers requested: 1 (pre & post)

AREERA - UPDATE• Issuance of Final AREERA Guidance

– Will be discussed by NIFA’s Policy Branch

• Reset or Newly Established Targets – Comments and recommendations received in response to

the “Interim Guidance” will be incorporated into the final AREERA guidance.

– Reconfirmed or newly established target percentages will be confirmed by NIFA.

– Newly established target percentages will take effect on October 1, 2010 (FY 2011 funding and thereafter;

– Due April 1, 2012

AREERARe-setting & Establishing Targets• Newly established targets will not be retroactive.

• NIFA will not require the institutions to make up any differences between old and new targets.

• LGI will still be responsible for meeting the target spending levels set for previous years.

• NIFA has carefully considered LGI comments and will incorporate the comments in the final version

AREERA Contacts• Brenda Barnett – NIFA-REPT expenditure reporting

(202) 401-6520

bbarnett@nifa.usda.gov

• Effie Baldwin - Policy & Oversight Branch – AREERA Guidance(202) 720-5070