[CAPLAW News] ACF Issues Guidance on Administrative Flexibilities

ACF Issues Guidance on Administrative Flexibilities

On March 31, 2020, the Administration for Children and Families (ACF) of the Department of Health and Human Services (HHS) issued an information memorandum (IM-ACF-OA-2020-01) permitting administrative flexibilities for ACF grantees that conduct human service activities related to or affected by COVID-19. This includes grantees that have been closed or whose operations have been curtailed due to COVID-19 precautionary measures or illnesses.

The IM more specifically addresses many of the flexibilities the Office of Management and Budget (OMB) had previously authorized (OMB Memo M-20-17). ACF grantees, including CSBG, LIHEAP, and Head Start recipients, may now take advantage of these exceptions to the Uniform Guidance, 45 C.F.R. Part 75.

Grantees that intend to use any of these flexibilities must notify their ACF Program Officer to describe the impact the COVID-19 emergency is having on their program and any ACF-related work. They should also maintain detailed records showing their decision to use such flexibilities, as individual funding sources may request such documentation.

The following Dear Colleague letters issued by the Office of Community Services (OCS) and the Office of Head Start (OHS) incorporate the ACF flexibilities for the respective programs:

CSBG Dear Colleague Letter (issued March 31, 2020)
LIHEAP Dear Colleague Letter (issued March 31, 2020)
Head Start Letter (issued March 31, 2020)

For block grants, including CSBG and LIHEAP, OCS is encouraging states to apply the flexibilities described in the IM to subrecipients (including CAAs) consistent with their own authorities. Grantees with questions should contact their assigned Grants Management Specialist and Project Officer.

Here is a summary of the flexibilities that apply to ACF grantees:

Charging salaries to the grant. Grantees may continue to charge salaries and benefits to their active awards, so long as this is consistent with the grantee’s current policy of paying salaries (under unexpected or extraordinary circumstances) from all funding sources (both federal and non-federal). Grantees are also permitted to amend or create emergency policies to put in place emergency contingencies, such as temporary modifications of employee hours.
Charging other project activities to the grant. Grantees may charge costs that are necessary to resume award activities so long as they meet the basic considerations for cost allowability in 2 C.F.R. §§ 200.402-411 (requiring that costs be necessary, reasonable, and allocable).
Charging costs that are not normally allowable. Grantees may charge the costs of cancelling events, travel, and other activities necessary and reasonable for the performance of the award due to the COVID-19 outbreak, even if these costs are not normally allowable under the Uniform Guidance. However, grantees should not assume additional funds will be available if charging such costs results in a shortage of funds to eventually carry out the event, travel, and/or other activities. ACF may, as appropriate, provide additional guidance on specific types of costs on its websites.
Relaxing requirements for grantees to have active SAM registrations at the time of application. Grantees with active SAM registrations that will expire before May 16, 2020 will receive a one-time extension of 60 days. ACF will continue to evaluate the risk posed by applicants at the time of the award.
Flexibility with application deadlines. ACF will provide flexibility for submitting competing applications, and will post specific guidance on its websites.
Granting no-cost extensions on expiring awards. Grantees may seek a no-cost extension for any awards that are active as of March 31, 2020 and will expire prior or up to December 31, 2020. This extension will be made at the ACF Program Officer’s discretion and will last for a period of 12 months.
Simplifying non-competitive continuation requests. If a grantee has a non-competitive continuation request that is scheduled to come in between April 1, 2020 and December 31, 2020, ACF will, at the Program Officer’s discretion, accept a brief statement verifying that the grantee is able to (i) resume or restore its project activities, and (ii) accept a planned continuation award. ACF will post any specific instructions at https://www.acf.hhs.gov/coronavirus.
Granting waivers from prior approval requirements. Within their ACF program officer’s discretion, a grantee may charge costs that would typically require prior approval without such approval if the costs are necessary and allowable to address the effects of COVID-19. The grantee may still want to seek prior approval to avoid potential cost disallowances. This waiver only applies to costs that are directly related to COVID-19. Further, all costs must remain consistent with federal cost principles and the terms of the award, except where noted in the IM. As appropriate, ACF will post any additional guidance on specific types of costs being allowed or not allowed at https://www.acf.hhs.gov/coronavirus.
Granting exemptions from certain procurement requirements. A grantee may request a waiver of the following procurement requirements: (1) prohibiting geographical preferences when evaluating bids or proposals (waiver of 45 C.F.R. § 75.328(b)); and (2) requiring the grantee to take all necessary affirmative steps to contract with small and minority businesses, women’s business enterprises, and labor surplus area firms (waiver of 45 C.F.R. § 75.330).
Extending financial and other reporting deadlines. A grantee may delay submitting financial, performance, and other reports for up to three months past the normal due date. The grantee may continue to draw down federal funds despite not submitting a timely report, though it must submit reports by the end of the extension period. The grantee must continue to notify ACF of problems, delays, or adverse conditions, including those related to COVID-19 as required by 45 C.F.R. § 75.342(d)(1).
Extending approved indirect cost rates. A grantee may contact the HHS Payment Support Center, Cost Allocation Services (PSC/CAS) to request an extension of a currently approved indirect cost rate. The contact information for PSC/CAS is PMSSupport@psc.hhs.gov or (887) 614-5533.
Extending closeout reports. A grantee may delay submitting any pending financial, performance, and other reports required for the closeout of expired projects, so long as it provides notice about the reporting delay to ACF. The closeout reports must be submitted no later than one year after the award expires.
Extending Single Audit submissions. A grantee that has not yet filed its Single Audit with the Federal Audit Clearinghouse as of March 31, 2020 and has a fiscal year-end through June 30, 2020 may delay completing and submitting the audit for up to 6 months. The grantee does not have to seek approval for the extension from ACF or the CAA’s oversight agency for audit. A grantee making use of the extension is still eligible to be deemed a “low-risk auditee” under 45 C.F.R. § 75.520(a).

This News Flash is part of the Community Services Block Grant (CSBG) Legal Training and Technical Assistance (T/TA) Center. It was created by Community Action Program Legal Services, Inc. (CAPLAW) in the performance of the U.S. Department of Health and Human Services, Administration for Children and Families, Office of Community Services Cooperative Agreement – Grant Award Number 90ET0467-03. Any opinion, findings, conclusions, or recommendations expressed in this material are those of the author(s) and do not necessarily reflect the views of the U.S. Department of Health and Human Services, Administration for Children and Families.

The contents of this news flash are intended to convey general information only and do not constitute legal advice. Any communication through this publication or through CAPLAW’s website does not constitute or create an attorney-client relationship. If you need legal advice, please contact CAPLAW or another attorney directly.