(g) Additional required documents when grant funds are used as venture capital. When a grantee proposes to undertake an activity using Title II funds as venture capital, the venture must be reported as an activity on CSA Form 419 of the grant application, for which the appropriate Standards of Effectiveness (§ 1067.4) must be addressed. If the grantee will not operate the venture itself, it shall arrange to sign a contract with the organization which will operate the venture. See § 1063.131 of this chapter for a discussion of the requirements when contracting with an organization to perform a component of the grant work program. In addition, the grantee shall submit the following materials, as appropriate, in support of the Form 419:

(1) Documentation that there will be no substantial negative impact on existing small businesses;

(2) Appropriate feasibility studies and cost analyses;

(3) Certified balance sheets and profit and loss statements for the immediately preceding three years or from the commencement of its operation (whichever period is shorter) if funds are to be used for the acquisition, preservation, or expansion of an existing business venture;

(4) Cash-flow projections and pro forma profit and loss statements and balance sheets estimated on a monthly basis for two years;

(5) Resumes of the management team;

(6) The articles of incorporation and the bylaws of the venture.

(h) Special CSA requests for grantee documentation. In accordance with OMB Circular A-110 and FMC 74-7, CSA reserves the right to require additional documentation in any areas of planning, specifications of work programs, or budget details if the grantee has a history of poor performance, is not financially stable, or if its management system does not meet the Uniform Federal Standards promulgated under Part 1050 (6800 series of CSA's directives system).

[42 FR 10689, Feb. 23, 1977, as amended at 42 FR 18402, Apr. 7, 1977; 42 FR 22365, May 3, 1977; 45 FR 39850, June 12, 1980]

§ 1067.40-4 Amendments.

(a) Grantee flexibility. (1) Grantees may make changes in the distribution of money within and between program accounts during the program year for which the money has been granted and certain other changes described below. In order to make some of these changes grantees must have prior permission from the Community Services Administration but they do not need prior permission if the changes are made within the allowed flexibility. (See viii below.) Where prior permission is required, an amendment request must be submitted to the CSA Administering Office as described below. Following are the various types of changes possible:

(i) Changes in the total program level. No change may be made by the grantee which changes the total program level. Such a change must be made by a supplemental grant (in the case of an increase) or a deobligation or reprogramming action (in the case of a decrease).

(ii) Decrease in the level of other than Section 221 Program. The grantee may not apply any funds for programs authorized under section 222 or section 231 to any program except that for which it was granted. If the level of these programs is to be decreased, it should be accomplished by a deobligation action on a CSA Form 314.

(iii) Increase in the level of other than a Section 221 Program. The grantee may apply funds for programs authorized under section 221 to any other CSA funded program run by the grantee, so long as neither work program is changed beyond what is allowed in (viii) below and it is within the flexibility rules. No prior CSA permission is needed for such a change. However, the Administering Office in CSA must be informed of such a change on a CAP Form 25b, Justification of Frogram Account Amendment.

(iv) Changes in administering agency funding levels. In executing contracts, a grantee may change the delegate agency's total funding level from that estimated on the Administering Agency Funding Estimate, CAP Form 85, submitted to the funding

office, Provided, That the sum of such changes does not exceed 25 percent of the delegate agency's total funding level (Federal and Non-Federal share) estimated on the CAP Form 85 (or $150,000 whichever is less). Changes exceeding 25 percent or $150,000 must have prior written approval from CSA Administering Office.

(v) Changes in work programs. A grantee may change the work program without prior CSA permission only if the changes:

(A) Do not constitute a basic change in objective, strategy, implementation plan or activities of the program;

(B) Do not increase or decrease by more than 20 percent the estimated number of participants, trainees or enrollees;

(C) Do not change the program account level more than the flexibility allowed in any one Program Year. (See paragraph (a)(1)(viii) of this section.)

(vi) Changes in salary and position. A grantee may change salaries or the number of staff positions, or create new positions without CSA approval, Provided, That such changes:

(A) Do not exceed wage comparability standards and grantee salary schedule;

(B) Are in accordance with CSA and grantee personnel policies;

(C) Do not result in work program changes for which CSA approval is required, as outlined in above, and

Provided, That CSA has not previously notified the grantee in writing that such a position may not be established. Written C3A approval must be obtained for all other changes in salaries and positions.

(vii) Changes in the amount of carryover funds assigned and in the new obligational authority approved for a program account. This form of amendment affects only the manner in which a program account is funded, not its budget or work program and is always initiated by CSA. It may result in a supplemental grant action or reduction of funds.

(viii) Changes between Section 221 Program Accounts. (A) Funds may be shifted between section 221 accounts; from section 221 accounts to section 222 accounts subject to the flexibility rules listed below. The Administering

Office must be informed of changes within flexibility within at most 30 days of the change, on a CAP Form 25b marked: "Change within flexibility; information only." Such changes made within flexibility are permitted only if they do not require prior CSA approval for any other reasons, for example, if the work program will be substantially altered (see paragraph (a)(1)(v) of this section). Obviously no funds can be moved into a program account not currently used by the grantee since that would more certainly involve a basic work program change and the move would increase the new account by more than 10 percent.

(B) Flexibility rules. (1) No account may be increased or decreased by more than 10 percent of $100,000, whichever is smalier, without prior CSA approval.

(2) This flexibility (10 percent or $100,000 whichever is smaller) is the total flexibility to be allowed in any one Program Year without prior CSA approval.

(C) Changes made within flexibility (as well as those made beyond flexibility with CSA permission) must show up immediately on the SF269, Financial Status Report. The Administering Office retains the right to disapprove any changes, even those which would fall within flexibility.

(ix) Changes between personnel and non-personnel costs. (A) Grantees may alter the budget submitted by moving funds between personnel and non-personnel categories without prior CSA permission, as long as no work changes outlined in paragraph (a)(1)(v) of this section are involved when the money remains in the same Program Account.

(B) Nothing in the foregoing shail prohibit the Administering Office from allowing the grantee to make changes, via formal amendment procedures, in the Work Program or the distribution of CSA administered funds which exceed the flexibility provisions described above. Also nothing in the foregoing shall prohibit the Regional Office or the funding office within CSA from disapproving changes which would normally be allowed under the flexibility procedures described above, Providing, That notice of such a prohibition shall be given to the grantee

by the funding office at the time that the funds are originally granted.

(2) The procedures by which the grantee requests prior permission for changes are outlined in paragraph (b) of this section.

(3) No change which is made may increase the percentage of administrative costs after changes are made to more than 15 percent of the total program costs. (See OEO Instruction 6807-1, June 17, 1969).

(4) No change which is made may increase the percentage of Federal assistance in the total cost above that indicated on CSA Form 314.

(b) How to amend a grant. (1) When a change in an already approved work program is proposed by the grantee which exceeds the scope of those permitted in paragraph (a) of this section, prior approval must be requested from CSA through submission of the following:

(i) CAP Form 25b Justification of Program Account Amendment;

(ii) CAP Form 25, Program Account Budget (if the requested change is related to budget); and/or

(iii) CAP Form 419, Summary of Work Programs and Budget, if there is also a change in the goals, elimination or addition of projects to be conducted, or change in total CSA funding level. Plus

(iv) A Statement of CSA Grant, CSA Form 314, must be executed if the change is in total CSA funding level.

81067.40-5 Where to apply.

Unless otherwise stated in specific program regulations, requests for information and forms, and submission of initial proposals should be addressed to the CSA Regional Office in your area.

Subpart 1067.41-Program Account Structure (CSA Instruction 61001b and 6100-1b CH 1)

SOURCE: 44 FR 61348, Oct. 25, 1979, unless otherwise noted.

§ 1067.41-1 Applicability.

This rule applies to grants funded under Titles I, II, IV, VII and IX of the Economic Opportunity Act of

APPENDIX B TO SUBPART 1067.41-DEFINITIONS OF ACTIVITIES WHICH MAY BE CONDUCTED, SINGLY OR IN COMBINATION UNDER EACH PROGRAM AcCOUNT

01. Local Initiative/CAA Administration (221)

Includes support for general administration and management of central staff, facilities, and equipment of the community action agency. Coordination, mobilization of resources, general management, information collection and use, as well as planning, program development, and evaluation activities undertaken by CAAs as part of their overall administrative and management responsibilities are included in this account. Support of the CAA board's functioning should also be included. Administrative overhead costs for delegate agencies or general support functions performed by the CAA for such delegate agencies where these costs are not related to specific programs may be included as appropriate. However, this activity does not include administration or management directly linked to specific program activities such as community nutrition activities, etc. Such administrative overhead should be reported under the account designated for that program.

02. Youth Sports-Summer Personnel (227)

Includes the personnel costs to operate the national youth sports program during the summer months, June through late August or mid-September. This program provides disadvantaged youths the opportunity for sports skills instruction, sports competition, learning good health practices, and career and educational opportunities. Stipends should not be included in this account.

03. Youth Sports-Summer Other (227) Includes the non-personnel costs to operate the national youth sports program during the summer months, June through late August or mid-September.

04. Youth Sports-Winter Program (227) Includes all costs, both personnel and nonpersonnel to operate the national youth sports program during the winter months, September through May.

05. Local Initiative Program (221)

The basic purpose of community action programs as stated in the Economic Opportunity Act is "to stimulate a better focusing of all available local, State, private, and Federal resources upon the goal of enabling low-income families, and low-income individ