Participant Questions from Registration

• Does OMB’s Uniform Administrative Requirements (SuperCircular) broaden, narrow, or supersede FTA’s circulars that were already issued?
• How does the SuperCircular fit into current regulations and laws?
• How do I determine my cognizant agency?
• What if a non-federal entity already has an approved indirect cost rate? Do they need to get a new indirect cost rate effective December 26, 2014?
• If a non-federal entity has a federally-approved negotiated indirect cost rate that is expiring and plans to apply for a new grant in October 2015 and they don’t have enough time to meet the deadline to renegotiate an indirect rate at the time of application, what can FTA permit?
• What is a cognizant agency?

Does OMB’s Uniform Administrative Requirements (SuperCircular) broaden, narrow, or supersede FTA’s circulars that were already issued?

In essence, the Uniform Guidance does all three. The SuperCircular replaces the former Uniform Administrative Requirements for Grants (OMB Circular A-102 and Circular A-110 or 2 CFR part 215 or Circular) as well as the Cost Principles (Circulars A-21 or 2 CFR 220; Circular A-87 or 2 CFR 225; and A-122, 2 CFR 230) and Circular A-133 guidance on the Single Annual Audit. DOT incorporated the changes Uniform Guidance under 2 CFR part 1201, which deviates from part 200 only with respect to standard application requirements, equipment, procurements by States, and financial reporting.

In addition, Part 1201 supersedes and repeals the requirements of the Department of Transportation Common Rules (49 CFR part 18—Uniform Administrative Requirements for Grants and Cooperative Agreements to State and Local Governments and 49 CFR part 19—Uniform Administrative Requirements—Uniform Administrative Requirements for Grants and Agreements with Institutions of Higher Education, Hospitals, and other Non- Profit Organizations), except that grants and cooperative agreements executed prior to December 26, 2014 shall continue to be subject to 49 CFR parts 18 and 19 as in effect on the date of such grants or agreements.

In practice this means that the administrative requirements and cost principles found in 2 CFR Part 200, the Uniform Guidance, became effective for new awards and additional funding to existing awards on December 26, 2014. The audit requirements will apply to audits of fiscal years beginning on or after December 26, 2014.

FTA is working to update its guidance, FTA Circular 5010.1D, “Grant Management Requirements” to ensure it is consistent with the new Uniform Guidance and DOT’s deviations. As FTA is required to issue revised updated guidance through a notice and comment process, grantees may continue to follow the procedures of FTA Circular 5010.1D. However, where Circular 5010 references specific requirements of 49 CFR 18 or 19, or the old Common Rule, non-Federal entities should follow the guidance in the 2 CFR part 200 and 2 CFR part 1201 for awards or amendments made after December 26, 2014.

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How does the SuperCircular fit into current regulations and laws?

It may be useful to keep in mind the order of precedence of various guidance tools when administering grants. The items below are from highest to lowest:

• The U.S. Constitution (is the basis for and takes precedence of all laws, regulations, etc.)
• Public Laws (PL) made by the Congress
• Sections of PLs that are then placed into the appropriate title of the United States Code (U.S.C.) based on the subject matter. For example, Title 49 U.S.C. is set aside for the Department of Transportation. Federal transit laws are codified into 49 U.S.C. Chapter 53. These would be our programs’ authorizing legislation.
• Implementation of the U.S.C. through regulations issued by the Secretary of the appropriate Federal agency. These regulations go through the regulatory process and are printed in the appropriate Title within the Code of Federal Regulations (CFR). For Example DOT’s deviations from the OMB Uniform Guidance are included in 2 CFR Part 1201.
• Office of Management and Budget (OMB) Circulars (like the SuperCircular).
• Other Circulars and Notices that are used for the implantation of the Agency CFR. These Circulars and Notices cannot be in conflict with OMB Circulars.

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How do I determine my cognizant agency?

Cognizance is determined by the amount of funding received and the type of organization. The Federal awarding agency that provides the predominant amount of direct funding to a non-Federal entity is its cognizant agency for indirect costs.

In order to apply for an indirect cost rates, applicants and recipients should follow the instructions outlined in the SuperCircular and the appropriate appendices for that type of organization. The rate established by the cognizant agency in the NICRA must be accepted by all Federal organizations and pass-through entities. Only organizations that have never had a NIRCA may elect to charge the 10% de minims rate.

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What if a non-federal entity already has an approved indirect cost rate? Do they need to get a new indirect cost rate effective December 26, 2014?

No. Existing negotiated indirect cost rates will remain in place until they are due to be re-negotiated. Federal agencies are required to accept negotiated indirect cost rates, unless otherwise noted.

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If a non-federal entity has a federally-approved negotiated indirect cost rate that is expiring and plans to apply for a new grant in October 2015 and they don’t have enough time to meet the deadline to renegotiate an indirect rate at the time of application, what can FTA permit?

The SuperCircular allows for a one-time extension without further negotiation of a federally-approved negotiated indirect cost rate for a period of up to 4 years. This extension will be subject to the review and approval of the cognizant agency for indirect costs. If an extension is granted, the non-federal entities may not request a rate review until the extension period ends. At the end of the time period, a new indirect cost rate must be negotiated with the cognizant agency.

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What is a cognizant agency?

For indirect cost rates and departmental indirect cost allocation plans, the cognizant agency is the Federal agency with the largest dollar value of direct Federal awards with a governmental unit or components, as appropriate.

The cognizant agency for audit means the federal agency designated to carry-out the responsibilities described in 200.513 (Responsibilities). A non-federal entity expending more than $50 Million per year in federal awards must have a cognizant agency for audit. The cognizant agency for audit is not necessarily the same as the cognizant agency for indirect costs. The list of cognizant agencies for audit can be found at FAC website.

Once designated as the cognizant agency the Federal agency must remain so for a period of five years.

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