03-13161. NASA Grant and Cooperative Agreement Handbook-Incremental Funding

AGENCY:

National Aeronautics and Space Administration.

ACTION:

Final rule.

SUMMARY:

This final rule amends the NASA Grant and Cooperative Agreement Handbook by revising the conditions and restrictions for use of incremental funding. The revisions in this area are necessary to increase flexibility while retaining appropriate controls over the number and size of incremental funding actions. The final rule also removes duplicative reference to property standards from the Buy American Encouragement provision; updates the grant and cooperative agreement identification numbering scheme used by NASA; and corrects a summary list of provisions. These changes will ensure the appropriate use of incremental funding of grants, eliminate an unnecessary cross-reference within a provision, and make other internal administrative and technical changes.

EFFECTIVE DATE:

May 27, 2003.

FOR FURTHER INFORMATION CONTACT:

Rita Svarcas, NASA Headquarters, Code HC, Washington, DC, [phone], e-mail: [e-mail].

SUPPLEMENTARY INFORMATION:

A. Background

This change amends and clarifies the circumstances under which grants and cooperative agreements can be incrementally funded. A previous change in this area was intended to minimize the number of incremental funding actions issued under NASA grants and cooperative agreements in order to increase internal efficiency and decrease the associated workload for grantees. However, the unintended consequences of the change were that the NASA Centers were constrained from awarding and funding lower-dollar-value instruments, especially during the latter part of the Government Fiscal Year and during continuing resolution periods. This regulation has been identified, through a “Freedom to Manage” suggestion, as a barrier that gets in the way of NASA's efficiency and effectiveness. This final rule is intended to correct the situation by allowing the NASA Centers to incrementally fund grants and cooperative agreements more often, including those with a lower dollar value and those that require funding during continuing resolution periods. This final rule retains an adequate level of control over such actions by setting dollar thresholds and establishing local waiver authority for potential exceptions. Additionally, NASA is in the process of implementing a new Agency-wide Integrated Financial Management System. This implementation requires a minor change to the number of digits and sequence of characters used in the grant and cooperative agreement identification number. Lastly, when the provision at 1260.39, Buy American Encouragement, was added in July 2002, it unnecessarily included a duplicative reference to property standards; and it incorrectly changed the listing of provisions to be included in research grants, education grants, and cooperative agreements with U.S. educational institutions and non-profit organizations in section 1260.20, Provisions. This final rule makes the necessary internal administrative changes for incremental funding and grant numbering; removes a duplicative reference in a provision; and corrects the list of applicable provisions.

B. Regulatory Flexibility Act

NASA certifies that this final rule will not have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601 et seq., because the changes primarily modify existing internal operational practices.

C. Paperwork Reduction Act

The Paperwork Reduction Act does not apply because this final rule does not impose any new recordkeeping or information collection requirements, or collection of information from offerors, contractors, or members of the public that require the approval of the Office of Management and Budget under 44 U.S.C. 3501, et. seq.

List of Subjects in 14 CFR Part 1260

• Grant Programs—Science and Technology

Tom Luedtke,

Assistant Administrator for Procurement.

Accordingly, 14 CFR part 1260 is amended as follows:

1. The authority citation for 14 CFR part 1260 continues to read as follows:

Authority: 42 U.S.C. 2473(c)(1), Pub. L. 97-258, 96 Stat. 1003 (31 U.S.C. 6301, et seq.), and OMB Circular A-110.

PART 1260—GRANTS AND COOPERATIVE AGREEMENT

2. Amend section 1260.11 by revising paragraph (h) to read as follows:

§ 1260.11

Evaluation and selection.

* * * * *

(h) NASA reserves the right to either fully fund or incrementally fund grants based on fiscal law and program considerations. Incremental funding of grants and cooperative agreements shall conform to the following procedure:

(1) When the period of performance for a grant crosses Government Fiscal Years, the grant will usually be incrementally funded, using appropriations from different Government Fiscal Years. In other circumstances, incremental funding may be appropriate. The special condition at § 1260.53, Incremental Funding, will be included in any grant that is incrementally funded. The grant officer will determine the number of incremental funding actions that will be allowed.

(2) Specific limitations on incremental funding are as follows:

(i) Grants that are funded using appropriations from different Government Fiscal Years should provide funding from the prior fiscal year that carries at least one month into the subsequent fiscal year in order to facilitate transition of the grant to the subsequent fiscal year's funding cycle.

(ii) Only those grants whose anticipated funding exceeds $100,000 of appropriations from a single Government Fiscal Year may be incrementally funded within that fiscal year's appropriations.

(iii) Incremental funding actions to obligate or deobligate funds shall not total less than $25,000 unless the action is necessary to comply with the requirement to use appropriations from different Government Fiscal Years, to fully fund a grant, to close out a grant, or to make a corrective accounting adjustment.

(3) On an exception basis, and with the concurrence of the installation Chief Financial Officer (CFO) or Deputy CFO for Resources, the procurement officer may waive the restrictions set forth in paragraphs (h)(2)(i) through (h)(2)(iii) of this section for individual funding actions on individual grants. The procurement officer shall maintain a record of all such approvals during the fiscal year.

(4) The restrictions set forth in paragraphs (h)(2)(i) through (h)(2)(iii) of this section are not applicable during the period of a continuing resolution. During such a period, NASA will nonetheless endeavor to fund individual grants using reasonably sized increments.

* * * * *

§ 1260.15

[Amended]

3. Section 1260.15 is amended as follows:

a. In the introductory text of paragraph (c), remove the words “prior to Integrated Financial Management Project (IFMP) implementation”;

b. In paragraph (c)(1), remove “NAG5” and add “NAG5-” in its place; and

c. Remove paragraph (d).

4. Amend Section 1260.20 by revising paragraph (a); and in the first sentence of paragraph (d) remove “1260.39” and add “1260.38” in its place.

Revised paragraph (a) reads as follows:

§ 1260.20

Provisions.

(a) Research grants, education grants, training grants, and cooperative agreements with U.S. educational institutions and nonprofit organizations shall incorporate by reference the provisions set forth in §§ 1260.21 through 1260.39. For training grants, the grant officer shall substitute § 1260.22, Technical Publications and Reports, with reporting requirements as specified by the program office.

* * * * *

§ 1260.39

[Amended]

5. Amend section 1260.39 by revising the date of the provision to read “May 2003”; removing the paragraph designation paragraph “(a)”; and removing paragraph (b).