Sneak Preview: EPA Issues Revised Uniform Guidance Exceptions

Jerry Ashworth
October 9, 2020 at 07:59:15 ET
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(The following was excerpted from a recent Thompson Grants 360 article.) The Environmental Protection Agency (EPA) issued an interim final rule updating the agency’s regulation at 2 C.F.R. Part 1500, adding new exceptions to the Office of Management and Budget’s (OMB) revised uniform guidance. EPA originally codified the uniform guidance at Part 1500 in 2014. EPA’s implementation of the revised regulations in this recent interim final rule becomes effective for new awards and amendments to existing awards issued on or after Nov. 12, as do OMB’s recent revisions to the uniform guidance.

The interim final rule, once effective, will delete current regulations at 2 C.F.R. §§1500.17-1500.19, and redesignate the current provisions at 2 C.F.R. §§1500.1-1500.16 to §§1500.2-1500.17. EPA is revising §1500.1 to clarify that allowable participant support costs may include rebates or other subsidies provided to program participants or program beneficiaries when authorized by the statutory authority for the financial assistance program. The provision applies to subsidies used for purchase and installation of commercially available, standard (“off the shelf”) pollution control equipment or low-emission vehicles under the Diesel Emission Reduction Act program or other programs when the program participant rather than the recipient owns the equipment.

Under the applicability provision, moved to §1500.3, EPA’s exceptions already state that subparts A through E of the uniform guidance apply to foreign public entities or foreign organizations, except where EPA determines that applying these subparts would be inconsistent with the international obligations of the U.S. or the statute or regulations of a foreign government. The uniform guidance notes that federal agencies “may,” but were not required to, implement this as a requirement for foreign entities, and EPA opted to include this in its regulations.

EPA has added a new provision at §1500.3(b) stating that subrecipient monitoring and management requirements (§§200.331-200.333) do not apply to transactions entered into with borrowers by recipients of Clean Water State Revolving Fund (CWSRF) capitalization grants and Drinking Water State Revolving Fund (DWSRF) capitalization grants. This regulatory change will allow states to follow their own procedures rather than those mandated by the uniform guidance. Requirements for reporting subaward and executive compensation (2 C.F.R. Part 170) and internal controls (§200.303) will continue to apply to CWSRF and DWSRF program grant recipients and borrowers.

(The full version of this story has now been made available to all for a limited time here.)

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