K7: Subrecipient Selection and Monitoring

Responsibility for Maintenance: Academic Affairs; Financial Services

I. Policy Statement

As a recipient of federal grants, Onondaga Community College is responsible for ensuring proper stewardship of funds in alignment with applicable laws, regulations, requirements of the funding agency and grant award agreement, and the college’s policies and procedures. In instances where the college uses a portion of its federal grant award to engage an external partner to complete one or more components of the project or program in support of its objectives, the college is acting as a Pass-through Entity as defined in 2 CFR 200.1 and is required to fulfill its responsibilities as a Pass-through entity as specified in 2 CFR 200.331-333. This responsibility includes: 

(1) Making determinations whether a prospective or current partner to be compensated with funding from an award is categorized as a subrecipient or contractor (2 CFR 200.331);

(2) Meeting the requirements specified in 2 CFR 200.332, including: (a) Ensuring every subaward is clearly identified to the subrecipient as a subaward and includes the required information, (b) Evaluating each subrecipient’s risk of non-compliance with Federal statutes, regulations, and the terms and conditions of the subaward for the purposes of determining appropriate subrecipient monitoring; (c) Considering imposing specific subaward conditions upon a subrecipient if appropriate; (d) Monitoring the activities of the subrecipient; (e) Using monitoring tools to ensure proper accountability and compliance with the program requirements and achievement of performance goals; (f) Verifying that every subrecipient is audited as required by Subpart F of this part when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in § 200.501; (g) Considering whether the results of the subrecipient's audits, on-site reviews, or other monitoring indicate conditions that necessitate adjustments to the pass-through entity's own records; (h) Considering taking enforcement action against noncompliant subrecipients as described in § 200.339 of this part and in program regulations; and 

(3) With prior written approval from the Federal awarding agency, provide subawards based on fixed amounts up to the Simplified Acquisition Threshold, provided that the subawards meet the requirements for fixed amount agreements in § 200.201. 

II. Reason for Policy

The purpose of this policy is to comply with OMB Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (2 CFR 200) (“Uniform Guidance”), specifically §200.331 (subrecipient and contractor determinations), §200.332 (Requirements for pass-through entities), and §200.333 (fixed amount subawards), support proper stewardship of federal grants and contracts and attainment of the goals and objectives. 

III. Applicability of the Policy

College employees responsible for leading or contributing to projects or programs supported by a federal grant award or cooperative agreement that include one or more subrecipients must comply with this policy.  This policy does not apply to contractors or vendors.

IV. Related Documents

V. Contacts

Subject 

Office Name 

Title or Position 

Telephone Number 

Email/URL 

Administration and Compliance

Academic Affairs

Provost and Senior Vice President

(315) 498-2594

provost@sunyocc.edu

Administration and Compliance

Financial Services

Senior Vice President and Chief Financial Officer

(315) 498-2668

m.r.manning@sunyocc.edu

VI. Definitions

Contract means, for the purpose of Federal financial assistance, a legal instrument by which a recipient or subrecipient purchases property or services needed to carry out the project or program under a Federal award (§ 200.1). For additional information on subrecipient and contractor determinations, see § 200.331. See also the definition of subaward in this section.

Contract (§ 200.331): A contract is for the purpose of obtaining goods and services for the non-Federal entity's own use and creates a procurement relationship with the contractor.  Characteristics indicative of a procurement relationship between the non-Federal entity and a contractor are when the contractor:

(1) Provides the goods and services within normal business operations;

(2) Provides similar goods or services to many different purchasers;

(3) Normally operates in a competitive environment;

(4) Provides goods or services that are ancillary to the operation of the Federal program; and

(5) Is not subject to compliance requirements of the Federal program as a result of the agreement, though similar requirements may apply for other reasons.

 

Contractor means an entity that receives a contract as defined in 2 CFR 200.1

 

Grant agreement means a legal instrument of financial assistance between a Federal awarding agency or pass-through entity and a non-Federal entity that, consistent with 31 U.S.C. 6302, 6304:

(1) Is used to enter into 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 awarding 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 awarding agency in carrying out the activity contemplated by the Federal award.

(3) Does not include an agreement that provides only:

(i) Direct United States Government cash assistance to an individual;

(ii) A subsidy;

(iii) A loan;

(vi) A loan guarantee; or

(v) Insurance.

Pass-through entity (PTE) means a non-Federal entity that provides a subaward to a subrecipient to carry out part of a Federal program.

Recipient means an entity, usually but not limited to non-Federal entities that receives a Federal award directly from a Federal awarding agency. The term recipient does not include subrecipients or individuals that are beneficiaries of the award.

 

Subaward means an award provided by a pass-through entity to a subrecipient for the subrecipient to carry out part of a Federal award received by the pass-through entity. It does not include payments to a contractor or payments to an individual that is a beneficiary of a Federal program. A subaward may be provided through any form of legal agreement, including an agreement that the pass-through entity considers a contract.

 

Subrecipient ((§ 200.1): means an entity, usually but not limited to non-Federal entities, that receives a subaward from a pass-through entity to carry out part of a Federal award; but does not include an individual that is a beneficiary of such award. A subrecipient may also be a recipient of other Federal awards directly from a Federal awarding agency.

VII. Responsibilities

During the pre-award phase, the Principal Investigator (PI) is responsible for identifying any external organizations that will commit to provide services or contribute to planning, implementation, or evaluation of a project as a cost share or as an expense in the proposal budget. For any organization included in the proposal, the PI will complete the Subrecipient/Contractor Determination Form to determine the organization’s classification as a subrecipient or contractor.  

Once a grant award has been made to the college, the Principal Investigator (PI) for the project is responsible for working with Management Services and Financial Services to conduct an initial subrecipient risk assessment for any partner that is included in the approved proposal budget and has been categorized as a “Subrecipient” partner prior to issuing the subaward agreement.  Upon completion of the initial Risk Assessment, the PI is responsible for working with Management Services, Financial Services, and Grants Administration to develop a Subrecipient Agreement and subrecipient monitoring plan aligned with the level of risk identified through the Risk Assessment. 

The PI is responsible for working with Management Services, Financial Services, and external consultants as needed, to implement the subrecipient monitoring plan, monitor subrecipient performance, provide technical assistance, and implement corrective measures if needed based on monitoring results.

VIII. Procedures

1. Pre-award (Determination of Contractor or Subrecipient and Risk Assessment):   

Prior to issuing a subaward, a grant project Principal Investigator/Project Director (PI) will identity and document the services and outcomes that it is seeking to obtain from third parties and proposed roles and responsibilities and required expertise or capabilities of the external entity.

 

The PI/PD will make an initial determination regarding whether the scope of work and roles and responsibilities of the partner are categorized as a vendor/contractor or subrecipient by completing the Subrecipient/Contractor Determination Form. As specified in 2 CFR 200.331 (Subrecipient and contractor determinations), “…a pass-through entity must make case-by-case determinations whether each agreement it makes for the disbursement of Federal program funds casts the party receiving the funds in the role of a subrecipient or a contractor.” The characteristics below from 2 CFR 200.331 serve as a guide in making this determination. 

 

A subrecipient plays a programmatic role in development, management, and implementation of a project through activities, such as:

  • Determines who is eligible to receive what Federal assistance;

  • Has its performance measured in relation to whether objectives of a Federal program were met;

  • Has responsibility for programmatic decision-making;

  • Is responsible for adherence to applicable Federal program requirements specified in the Federal award;

  • In accordance with its agreement, uses the Federal Funds to carry out a program for a public purpose specified in authorizing statute, as opposed to providing goods or services for the benefit of the pass-through entity.

In contrast, a Contractor:

  • Provides the goods and services within normal business operations;

  • Provides similar goods or services to many different purchasers;

  • Normally operates in a competitive environment;

  • Provides goods or services that are ancillary to the operation of the Federal program.

  • Is not subject to compliance requirements of the Federal program as a result of the agreement, though similar requirements may apply for other reasons

 

If the partnership is categorized as a contractor or vendor, the college will follow procurement policies and procedures for contractors (G6) and applicable federal regulations and terms and conditions of the award.  If the relationship planned is determined to be that of a subrecipient, the college will follow the procedures under K7 for selecting, issuing, monitoring, managing, and closing out subawards.

2. Initial Risk Assessment: In accordance with 2 CFR 200.332 (b), the college will conduct an initial risk assessment to evaluate each proposed subrecipient’s noncompliance risk. The risk assessment takes into consideration the following factors to the extent appropriate to each individual subaward situation:

  • Subrecipient’s prior experience with the same or similar activities,

  • Results of Federal agency monitoring, 

  • Results of prior audits performed, 

  • History of performance and reporting, 

  • Whether subrecipient has new personnel or substantially changed systems, 

  • Extent to which a federal awarding agency monitors subrecipient’s activities under direct awards,

  • Compliance with federal agency requirements

OCC’s Financial Services Department, in coordination with the Project Director/Principal Investigator, will generally conduct risk assessments in advance of making subawards. OCC Management Services will search the System for Award Management (SAM) to ensure the organization is not on the list of organizations suspended or debarred.  In circumstances where advance assessments are not practical, the college will schedule an initial assessment within the first year of the subrecipient’s performance. 

 

Depending upon the degree of risk anticipated, and OCC’s experience with the subrecipient, the initial assessment may be more or less robust.  It may include a site visit to the subrecipient’s offices or facility, desk reviews of subrecipient’s policies and procedures, and/or review of subaward project plans.

3. Issuing Subawards: Each subaward agreement will be clearly identified as a subaward.

In accordance with 2.CFR.200.332, each subaward agreement will include the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the college will provide the best information available to describe the Federal award and subaward. Required information includes: 

(1) federal award identification, including:

  • Subrecipient name (which must match the name associated with its unique entity identifier);

  • Subrecipient's unique entity identifier;

  • Federal Award Identification Number (FAIN);

  • Federal Award Date of award to the recipient by the Federal agency;

  • Subaward Period of Performance Start and End Date;

  • Subaward Budget Period Start and End Date;

  • Amount of Federal Funds Obligated by this action by the pass-through entity to the subrecipient;

  • Total Amount of Federal Funds Obligated to the subrecipient by the pass-through entity including the current financial obligation;

  • Total Amount of the Federal Award committed to the subrecipient by the pass-through entity;

  • Federal award project description, as required to be responsive to the Federal Funding Accountability and Transparency Act (FFATA);

  • Name of Federal awarding agency, pass-through entity, and contact information for awarding official of the Pass-through entity;

  • Assistance Listings number and Title; Dollar amount made available under each Federal award and the Assistance Listings Number at time of disbursement;

  • Identification of whether the award is R&D; and

  • Indirect cost rate for the Federal award (including if the de minimis rate is charged) per § 200.414.

(2) All requirements imposed by the college as the pass-through entity on the subrecipient so that the Federal award is used in accordance with Federal statutes, regulations and the terms and conditions of the Federal award;

(3) Any additional requirements the college imposes on the subrecipient to meet its own responsibility to the Federal awarding agency including identification of any required financial and performance reports;

(4) An approved federally recognized indirect cost rate negotiated between the subrecipient and the Federal Government. If no approved rate exists, the pass-through entity must determine the appropriate rate in collaboration with the subrecipient, which is either negotiated indirect cost rate between the pass-through entity and the subrecipient; or the de minimis indirect cost rate.

(5) A requirement that the subrecipient permit the college and auditors to have access to the subrecipient’s records and financial statements as necessary for the college to meet the requirements; and

(6) Appropriate terms and conditions concerning closeout of the subaward.

 

Based on the risk assessment, the college may incorporate additional conditions (2 CFR 200.208), which may include but are not limited to the following

  • Requiring payments as reimbursements.

  • Withholding authority to proceed to the next phase.

  • Requiring more detailed financial reports.

  • Requiring additional monitoring.

  • Requiring the subrecipient to obtain technical or training assistance.

  • Establishing additional prior approvals.

4. Subrecipient Monitoring: Once a subaward agreement is in place, the college is responsible for monitoring the progress of the subrecipient. This includes the following: 

  • Ensure that subrecipient is on its way to meeting performance and financial goals (2 CFR 200.332) and provide technical assistance, when needed.

  • Ensure compliance with subaward terms and conditions 2 CFR 200.332(a)(2) including terms and conditions in the original grant agreement, including by conducting monitoring and oversight 2 CFR 200.332(d).

  • Establish remedies for non-compliance (2 CFR 200.339) and consider taking enforcement action against noncompliant subrecipients.

  • Ensure subrecipients meet the audit requirements 2 CFR 200.332(f).

  • Ensure access to subaward records including proper retention of records (2 CFR 200.332(a)(5)).

  • Properly closeout the subaward 2 CFR 200.332(a)(6)

OCC will monitor subrecipients through the procedures summarized below. These baseline procedures may be adapted by the college to meet specific requirements of each grant award, project, and subrecipient.

  1. Upon award, the college will schedule a meeting with the subrecipient/s to review the project goals, project plan, subrecipient’s scope of work and budget, terms and conditions of the award, and requirements.

  2. OCC will require subrecipients to submit invoices with a sufficient level of detail and supporting documentation. Invoices and supporting documentation will be submitted at least quarterly and will be reviewed by the PI/PD prior to payment. The PI/PD will authorize payments to sub-awardees and subcontractors consistent with the work performed and the grant requirements.

  3. OCC will require subrecipients to submit performance reports and financial reports to the PI /PD at least quarterly. Financial reports will be reviewed by the PI/PD and by OCC Financial Services. All Subrecipients must comply with external and internal reporting requirements and deadlines, allowing sufficient time for review and approvals. The Grant Project Director reviews all programmatic and financial reports submitted by the Subrecipient. Financial Services reviews, approves, and submits, financial reports prior to submission.

  4. Desk Reviews and Site Visits: The college will generally require the grant project director to develop a monitoring schedule within the first year of a subaward being issued in alignment with the level of risk of the subrecipient and requirements of the grant. Desk reviews or site visits (virtual or in person) will be conducted by the project director in coordination with applicable administrative departments and/or external evaluators or subject matter experts. The college will request the subrecipient submit documentation for review in advance of the visit, including relevant subrecipient policies and procedures that impact the performance of the subaward and management of federal funds. The college will schedule meetings with members of the subrecipient’s project team and grants and fiscal staff.

  5. Periodic Meetings: The project director will schedule periodic meetings with key subrecipient personnel each year to monitor ongoing work and progress toward the project’s goals and objectives.

  6. Reports: Upon conclusion of a desk review or site visit, the college will schedule an exit meeting and document any concerns, findings, and noted practices. Any areas of concern or findings noted in the report will include the condition, cause, criteria, and corrective action, including technical assistance or training.

  7. Closeout: The college will request copies of required documentation at the close of the subaward or require that the subrecipient retain and make available upon request copies of required documentation for the retention period.

 

Approved by the OCC Board of Trustees September 24, 2024